EXHIBIT 10.24.A


 


EMPLOYMENT CONTRACT


 


	
  THE STATE OF TEXAS

  	
  §

  	
   

  
	
   

  	
  §

  	
  KNOW ALL MEN BY THESE PRESENTS:    

  
	
  COUNTY OF MIDLAND

  	
  §

  	
   

  



 


THIS EMPLOYMENT CONTRACT
(“Agreement”) is made and entered into on or as of the 11th day of September,
2001 and the initial term of this Agreement and all other terms and provisions
herein, except for the amount of salary, are effective beginning as of the 3rd
day of August, 1992 when CAP ROCK ELECTRIC COOPERATIVE, INC. and DAVID W.
PRUITT entered into an Employment Contract. 
This Agreement modifies, amends and supercedes the Employment Contract
entered into between CAP ROCK ELECTRIC COOPERATIVE, INC. and DAVID W. PRUITT.
on August 3, 1992, which Employment Contract has been transferred to and
assumed by CAP ROCK ENERGY CORPORATION.


 


By this Agreement, CAP ROCK
ENERGY CORPORATION, referred to in this Agreement as “Company”, whose principal
place of office is located in Midland, Midland County, Texas employs DAVID W.
PRUITT, referred to in this Agreement as “Pruitt”, whose residence is in
Midland, Midland County, Texas, who accepts employment on the following terms
and conditions:


 


ARTICLE
1


 


TERMS
OF EMPLOYMENT


 


1.01        By this Agreement, the
Company employs Pruitt and Pruitt accepts employment with the Company as its
Chief Executive Officer (CEO)for an initial term of ten (10) years.  Unless a written notice to terminate this
Agreement at the expiration of the initial ten (10)year term is executed and
properly delivered by either party at least 360 days prior to the eighth
anniversary date of the initial term of this Agreement, this Agreement shall be
automatically extended for a three year term from said eighth (8th)anniversary
date.  Thereafter, unless written notice
to terminate this Agreement is executed and properly delivered by either party
within ninety (90) days prior to any subsequent anniversary date of this
Agreement, the term of this Agreement shall automatically be extended,
annually, on said anniversary date for a three year term from said anniversary
until Pruitt attains age 65.  This
Agreement may, however, be terminated earlier, as provided in Article 4, below.


 


ARTICLE
2


 


EMPLOYMENT
COMPENSATION & BENEFITS


 


2.01        As
compensation for all services rendered under this Agreement, Pruitt shall be
paid by Company a salary of $206,726.04 per year or any greater amount of
compensation including bonuses, fees and deferred compensation authorized by
the wage and salary plan or policies authorized by the Company’s Board of
Directors, together with an annual salary adjustment in an amount at least
equal to any approved across the board salary adjustments for all employees.


 


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2.02        Pruitt’s
duties require that he shall have the exclusive and unrestricted use at all
times during his employment with the Company of an automobile provided for him
by the Company.  The Company shall be
responsible for paying for liability, property damage, and comprehensive
insurance and for the purchase, operation, maintenance, repair and replacement
of said automobile.


 


2.03        Pruitt
shall receive the same annual leave and sick leave and all other benefits as
are accorded regular full-time employees of Cap Rock Energy Corporation
including provisions governing accrual and payment therefore on early
retirement or other methods of employment.


 


2.04        Subject
to the above paragraph 2.03, all provisions of the Company’s rules and
regulations relating to annual leave(vacation), sick leave, early retirement,
insurance, savings, deferred compensation, bonuses, pension program contributions,
holiday and other fringe benefits and working conditions approved by the Board
of Directors as they now exist or hereafter may be amended, shall apply to
Pruitt as they would to other employees of the Company.  However, Pruitt, at his option, can elect to
invest the Company’s annual expenses of Pruitt’s retirement plan in any chosen
and Board approved separate plan that provides for at least the same security
for both the Company and Pruitt.


 


2.05        Because
Pruitt’s duties will from time to time require him to work outside of, and in
addition to, the Company’s established normal work week, work days and work
hours, Pruitt shall be allowed to take compensatory time off.


 


ARTICLE
3


 


COVENANT
TO PERFORM: PROFESSIONAL IMPROVEMENT


 


3.01        Pruitt
agrees and covenants to perform his work and services diligently and use his
best efforts to faithfully comply with all of the Company’s duly made
assignments to him as CEO in accordance with all of the Company’s directives
and applicable bylaws, and policies.


 


3.02        The
Company will from time to time, pay for the travel and related out-of-pocket
and other expenses of Pruitt and his spouse for Pruitt’s attendance at and
participation in meetings, conferences, seminars and the like for the purpose
of continuing his professional development and thereby enhancing his ability to
perform his work and services for the Company, and for other activities deemed
by the Board to be beneficial to and in the best interest of the Company and
its members.


 


ARTICLE
4


 


TERM
AND TERMINATION


 


4.01        The
Company shall employ Pruitt pursuant to this Agreement for the ten (10) year
term beginning on the date of this Agreement, together with such annual
three(3) year renewals as provided herein, and ending no later than the end of
the three(3) year term next expiring on/after the date when Pruitt attains the
age of sixty-five (65) years.  During
such employment, Pruitt shall be obligated to perform the work and services
reasonably required in order to carry out


 


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those responsibilities and
exercise those authorities specified in the Position Responsibility Guide,
General Manager, agreed to by the Company and Pruitt on December 1, 1987, which
document is attached to and incorporated herein by reference.  However, the Company may terminate this
Contract for good cause in which event any of Pruitt’s rights hereunder not
already finally vested shall also terminate. 
The term “good cause” shall mean the following and not otherwise:


 


(1)           Knowingly, willfully and substantially,
during the term of this Agreement, neglect the duties that Pruitt is required
to perform under the terms of this Agreement.


 


(2)           Knowingly, willfully and substantially,
during the term of this Agreement, commit dishonest acts toward the Company
with the intent to injure or damage the Company.


 


4.02        If
Pruitt’s employment terminates prior to the initial term or any extended term
for any reason other than as provided for in paragraphs 4.01, 4.03, 4.04 or
4,05 because his authorities and responsibilities hereunder are substantially
and adversely (to him) limited, changed or eliminated, or because he is
required by the Company to move his residence and principal site of work from
the Midland, Texas area, and Pruitt is otherwise both able and willing to
perform his work and services as provided for hereunder, then, in any such
event, the Company shall pay Pruitt a lump-sum cash settlement equal to the
total salary then in effect for the remainder of the term of the contract, plus
the other amounts Company would have paid during such remainder for Pruitt’s
retirement, pension, MINT, bonus, fees other than compensation plans authorized
by the Board of Directors, and health insurance, plus such amounts, if any, are
at the time of his termination of employment, payable for accrued but untaken
vacation and sick leave.


 


4.03        Notwithstanding
paragraphs 4.01 and 4.02, the parties may mutually agree to terminate this
Agreement upon such terms and conditions as the parties may mutually agree in
writing.


 


4.04        Notwithstanding
the provisions of paragraphs 4.01, 4.02, and 4.03, above, Pruitt’s employment
hereunder shall terminate under any of the following conditions:


 


(1)           Death.    Pruitt’s
employment under this Agreement shall terminate automatically upon his
death.  In such event, Pruitt’s Base
Salary shall continue to be paid to his designated beneficiary for the
remaining term of this Agreement.


 


(2)           Total Disability.    The Company shall have the right to terminate this
Agreement if Pruitt becomes Totally Disabled. 
For purposes of this Agreement, “Totally Disabled” means that Pruitt is
not working and is currently unable to perform the substantial and material
duties of his position hereunder as a result of sickness, accident or bodily
injury for a period of three months. 
Prior to a determination that Pruitt is Totally Disabled, but after
Pruitt has exhausted all sick leave and vacation benefits provided by the
Company, Pruitt shall continue to receive his Base Salary, offset by any
disability benefits he may be eligible to receive, for the remaining term of
this Agreement.


 


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4.05        Not
withstanding any other provisions in this Agreement, if (i) Pruitt remains
employed until the date that is three (3) months after the date of a Change in
Control (the “Retention Date”), or (ii) Pruitt’s employment is terminated after
or in anticipation of a Change in Control (or the execution of a definitive
agreement providing for actions which, if completed, would constitute a Change
in Control) and before the Retention Date (A) by the Company without Good Cause
or (B) by Pruitt for Good Reason, then, in addition to any other amounts
payable pursuant to this Agreement, the Company shall pay Pruitt a lump sum
cash payment within thirty (30) days of termination equal to six (6) times the
sum of Pruitt’s annual Base Salary and the greater of (x) the highest bonus
awarded to Pruitt in a prior year or (y) 50% of Pruitt’s annual Base Salary.


 


For purposes
of this Agreement “Change in Control” means (i) a reorganization or merger of
the Company with or into any other company which will result in the Company’s
stockholders immediately prior to such transaction not holding, as a result of
such transaction, at least 50% of the voting power of the surviving or
continuing entity or the entity controlling the surviving or continuing entity;
(ii) a sale of all or substantially all of the assets of the Company to an
entity in which the Company’s stockholders immediately prior to such sale will
not hold following such sale at least 50% of the voting power of such
purchasing entity, (iii) a transaction or series of related transactions which
result in more than 50% of the voting power of the Company being “beneficially
owned” by a single “person” (quoted terms having their respective meanings
under Section 13(d) and 14(d) under the Securities Exchange Act of 1934, as
amended); (iv) a change in the majority of the Board not approved by at least
two-thirds of the Company’s directors in office prior to such change or (v) the
adoption of any plan of liquidation providing for the distribution of all or
substantially all of the Company’s assets.


 


For purposes
of this Agreement, after a Change in Control, “Good Reason” shall mean the
occurrence of any one of the following circumstances without Pruitt’s consent:


 


(1)           a material reduction in Pruitt’s salary or
benefits excluding the substitution of substantially equivalent compensation
and benefits;


 


(2)           a material diminution of Pruitt’s duties,
authority or responsibilities as in effect immediately prior to such
diminution;


 


(3)           the relocation of Pruitt’s primary work
location to a location more than 50 miles from Pruitt’s primary work location
as of the date of this Agreement; or


 


(4)           the failure of a successor to assume and
perform under this Agreement


 


4.06        In
the event either party should bring legal action or incur attorney’s fee and/or
court costs for the enforcement of any of the terms of this agreement, it is
agreed that the prevailing party shall be entitled to recover from the other
such reasonable attorneys fees and/or court costs incurred.  For purposes of this clause, the prevailing
party is the party to obtains a net recovery or the party in whose favor final
judgment is entered.


 


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ARTICLE
5


SUPERSESSION
AND EFFECTIVENESS


 


5.01         This
Agreement supercedes any other agreement or understanding, written or oral,
between the parties with respect to the matters covered hereunder, and it
contains the entire understanding of the parties and all of the covenants and
agreements between them with respect to Pruitt’s employment.


 


5.02         This
Agreement shall be for the benefit of the parties to the Agreement, as well as
their respective successors, heirs and assigns, it being understood, however
that this Agreement may be assigned only with the written consent of both
parties.


 


5.03         The
existence and effectiveness of this Agreement between the parties hereto does
not preclude or otherwise interfere with employment of Pruitt by subsidiary
corporations of Cap Rock Energy Corporation, or by any corporation organized by
the Company’s Board of Directors for the benefit of the Company, or the receipt
of compensation by Pruitt from any such corporations.


 


5.04         This
Agreement shall become binding upon the parties from an as of the date of the
execution.


 


IN WITNESS WHEREOF, the parties have executed this Agreement in
duplicate originals, one being retained by each, on or as of the 11th
day of September, 2001.


 


 


	
   

  	
  CAP ROCK ENERGY CORPORATION

  
	
   

  	
   

  
	
  By:

  	
  /s/ David W. Pruitt

  	
   

  	
  By:

  	
  /s/ Russell E. Jones

  
	
   

  	
  David W. Pruitt

  	
  Russell E. Jones

  Chairman

  
						



 


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  STATE OF TEXAS

  	
  )(

  
	
   

  	
  )(

  
	
  COUNTY OF MIDLAND

  	
  )(

  



 


This
instrument was acknowledged before me on this 11th day of September,
2001, by RUSSELL E. JONES, Chairman of Cap Rock Energy Corporation, a Texas
corporation, on behalf of said corporation.


 


	
   

  	
  By:

  	
  /s/ Sharon A. Hoelscher

  	
   

  
	
   

  	
   

  	
  Sharon A. Hoelscher

  
	
   

  	
  Notary Public, State of Texas

  	
   

  
	
   

  	
  Printed Name of Notary: 

  	
  /s/ Sharon A. Hoelscher

  	
   

  
	
   

  	
  My Commission Expires:

  	
   7/11/03

  	
   

  
									



(SEAL)


 


	
  STATE OF TEXAS

  	
  )(

  
	
   

  	
  )(

  
	
  COUNTY OF GRAYSON

  	
  )(

  



 


This
instrument was acknowledged before me on this 11th day of September,
2001, by DAVID W. PRUITT.


 


	
   

  	
  By:

  	
  /s/ Sharon A. Hoelscher

  	
   

  
	
   

  	
   

  	
  Sharon A. Hoelscher

  
	
   

  	
  Notary Public, State of Texas

  	
   

  
	
   

  	
  Printed Name of Notary: 

  	
  /s/ Sharon A. Hoelscher

  	
   

  
	
   

  	
  My Commission Expires:

  	
   7/11/03

  	
   

  
									



 


(SEAL)


 


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CAP
ROCK ELECTRIC COOPERATIVE, INC.


 


Position
Responsibility Guide


 


General
Manager


 


I.              OBJECTIVE


 


To advise and assist the Board of Directors in its considerations and
decisions in all matters and areas of concern for which it is responsible.  To provide the Cooperative membership with
the highest quality of electric service at the lowest possible cost, consistent
with sound economical and financial management.


 


II.            RESPONSIBILITIES
AND AUTHORITIES


 


1.             Directs and coordinates the administration
of policies and programs approved by the Board of Directors, and assures
conformity and compliance with the intent of the directors’ decisions.


 


2.             Is responsible for determining basic
operational procedures that are in accordance with board decisions, and assures
that operations of the Cooperative are carried out in a manner advantageous to
the membership so as to gain member understanding and support.


 


3.             Is responsible for preparation of agenda
for and reports to be made at meetings of the Board of Directors.  Presents to the directors the operational
and financial reports, and reports on the effectiveness of various programs and
over-all operations.


 


4.             Keeps the board fully informed of actions
taken or decisions reached in areas relevant to board consideration even though
specific board action may not be required.


 


5.             Is responsible for the effective and
efficient operation of all activities within the Cooperative including, but not
limited to, the following:


 


1.             Planning – Initiates and/or directs
the planning of all operational procedures essential to the most efficient
operation and effectiveness of the Cooperative.  Reviews, coordinates and approves procedures recommended by the
staff members with respect to their operations.


 


2.             Organization – Reviews periodically
all facets of the cooperative’s operation and determines the need and type of
organizational structure required to provide the most efficient operation. In
this regard, the Manager shall select, appoint and/or terminate staff members
in accordance with an approved organizational plan.  He shall also recommend to the Board of Directors a wage and
salary program designed to provide the employees with a fair and equitable
compensation plan


 


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that encourages individual incentive and increased productivity,
thereby providing the members of the Cooperative with reliable, effective and
efficient service.


 


3.             Administration – Directs the
administration of all activities of the Cooperative through staff members
and/or consultants, including legal counsel, to ensure that all
responsibilities, authorities and relationships are clarified and executed in
accordance with delegated authority, approved policies, programs and
budgets.  Devotes adequate  portions of time in conference with the
staff, in groups or with individuals, to discuss problems of engineering,
construction, maintenance, operations, finance, personnel complaints,
grievances, or any other matters of concern to the Cooperative.  Assigns staff and/or supervisory personnel
to represent the Cooperative at various technical and educational meetings that
will enhance the effectiveness of the Cooperative’s operation.


 


Communicates with the members, Board of Directors, employees, and
general public in order to gain their support and to improve the over-all acceptance
and understanding of the Cooperative’s policies and programs.


 


4.             Coordination – Exercise
coordination of board-approved budgets, policies and programs with operational
activities through staff meetings and individual conferences.  Acts as coordinator between the membership,
the Board of Directors and the employees.


 


5.             Controlling – Directs the
maintenance of all controls, reports and records in conformity with all
regulations and requirements.  Reviews
and analyses periodic reports, including financial audits, submitted by
Cooperative personnel and/or consultants for the purpose of determining whether
their activities are in conformity with approved policies, programs, budgets,
standards and costs; directs remedial action as required.


 


II.            RELATIONSHPS


 


A.            Within the Cooperative


 


1.             Consults freely  with Board of Directors and board committees regarding matters of
information and mutual interest on Cooperative’s affairs.


 


2.             Consults with staff as consultative
management procedure on all matters of organizational or operational concern,
or programs and problems of mutual interest


 


3.             Advises and counsels staff department
heads with respect to plans, activities, organization, problems, budgets,
reports or matters concerning single departments.


 


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4.             Encourages team spirit and teamwork to
maintain high morale, high productivity and great satisfactions in working for
the Cooperative.


 


5.             Maintains friendly and working relations
with as many members as possible to maintain high values of members’
satisfactions and to set the  example
for all employees to maintain friendly and satisfactory relationships with
members.


 


B.            Outside the Cooperative


 


1.             Maintains contact through correspondence
and some visitation with governmental officials, elected or appointed at
various local, state and national governmental levels.


 


2.             Maintains contact with widespread sector
of the industry and public to maintain good relations and understanding.


 


IV.           SCOPE


 


The above authorities and responsibilities are limited only by
appropriate provisions of Federal and State statues, rules, regulations and
requirements; corporate documents consisting of Articles of Incorporation and
Bylaws; and board policies, specific delegations or restrictions and other
directives.


 


V.            RESPONSIBLE
TO:  Board of Directors


 


VI.           EXEMPTION
STATUS


This position
is exempt from overtime payment.


 


	
  AGREED TO:

  	
  APPROVED:

  
	
   

  	
   

  
	
   

  	
   

  
	
  /s/ David W. Pruitt

  	
   

  	
  /s/ Russell E. Jones

  	
   

  
	
  General Manager

  	
  President

  
	
   

  	
   

  
	
  9-11-01

  	
   

  	
   

  
	
  Date

  	
   

  



 


I hereby acknowledge that I have received a
copy of the General Obligations and Responsibilities of Employees.


 


 


	
  /s/ David W. Pruitt

  	
   

  	
   9-11-01

  	
   

  
	
  General Manager

  	
   Date

  



 


9