Business Context and Reporting Period
This Form 8-K Current Report was filed by Pinnacle West Capital Corporation and its subsidiary, Arizona Public Service Company (APS), on June 23, 2008. The filing reports a significant executive appointment effective July 14, 2008.
Key Financial Metrics
The filing does not provide financial performance metrics such as revenue, profit, cash flow, margins, debt, or liquidity. The document focuses exclusively on executive compensation arrangements.
Material Changes
The primary material change is the appointment of James R. Hatfield as Senior Vice President and Chief Financial Officer for both Pinnacle West and APS. Mr. Hatfield joins from OGE Energy Corp., where he served as Senior Vice President and CFO since 1999.
Management Commentary and Compensation Details
Mr. Hatfield's compensation package includes the following components:
- Base Salary: $450,000 annually.
- Hiring Incentive: $200,000 payable within two weeks of employment and $100,000 payable within two weeks following the first anniversary.
- Annual Incentive Plan: Target payment of 50% of base salary with a maximum of 100%.
- Relocation: Benefits and home sale assistance included.
- Restricted Stock Units (RSUs): Grant of 6,000 units vesting in February of 2009 (1,000), 2010 (2,000), 2011 (2,000), and 2012 (1,000).
- Performance Shares: Grant of 6,800 shares (right to receive up to two shares each) contingent on three-year earnings per share growth rates. Vesting schedule: 1,400 (2009), 2,000 (2010), and 3,400 (2011).
Investor Verification Checklist
- Verify the effective start date of July 14, 2008, for the new CFO.
- Confirm the specific earnings per share growth targets required for the performance share vesting.
- Review the total equity grant value relative to the company's current stock price.
- Check for any potential conflicts of interest regarding Mr. Hatfield's departure from OGE Energy Corp.