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Development; and Financial Goals. These categories are used to characterize the overall <br /> strategic goals and mission of ERMU. <br /> Under the Performance Metrics,these three main categories are then divided into various <br /> weighted factors, or sub-categories. These sub-categories, their percentage weight, and the goal <br /> or target for each, shall be established by the Utilities Commission annually. The Performance <br /> Metrics as adopted are reflected in the attached Score Card. As discussed above,the <br /> Performance Metrics and thus the Score Card are subject to modification and adoption by the <br /> Commission annually,which will normally occur during the Utilities' budgeting process. <br /> 3.0 Utilities Performance Incentive Compensation Distribution Criteria <br /> Under the UMPIC a Performance-Based Compensation Incentive, if earned, will be distributed <br /> to Qualifying Employees annually. The total amount available to be earned by Utilities <br /> employees as a Performance Based Compensation Incentive each year will be an amount up to <br /> 2%of the Utilities' total gross wages paid to Qualifying Employees during the Measurement <br /> Period. <br /> The measuring period used to calculate how much, if any, of the Performance-Based <br /> Compensation Incentive the Utilities employees have earned will be the calendar year(the <br /> "Measurement Period"). After the Measurement Period is complete and the Commission has <br /> received its audit in the spring of the year following the Measurement Period, the Performance <br /> Metrics will be applied to determine whether the Performance-Based Compensation Incentive <br /> has been earned for the Measurement Period. In doing so, the performance of the Utilities in <br /> each sub-category will be reviewed. If the sub-category performance meets or exceeds the <br /> established goal,the sub-category will be scored with the designated percentage that will <br /> contribute to a total Performance Metrics Multiplier to be used as a factor in calculating the <br /> distribution earned, if any, as shown in the Score Card("Multiplier"). The Multiplier has a <br /> maximum factoring effect of 100%. The Multiplier is used to determine how much, if any, of <br /> the amount established by the Commission for the UMPIC Performance-Based Compensation <br /> Incentive has been earned in the Measurement Period. (For example if the Multiplier equals <br /> 100%, the distribution would equal 2%. If the Multiplier equals 75%,the distribution would <br /> equal 1.5%.) In other words, the amount established by the Commission may be earned on an <br /> annual basis by the group of Qualifying Employees (as defined below in Section 4.0) in whole, <br /> in part, or not at all. <br /> After the Multiplier is calculated on the Score Card,the Performance Based Compensation <br /> Incentive earned, if any,will be distributed to Qualifying Employees. The total amount to be <br /> distributed as the Performance Based Compensation Incentive will be the product of: a)the <br /> Multiplier; and b) 2% of the Utilities' total gross wages paid to Qualifying Employees during the <br /> Measurement Period. <br /> The percentage of the Performance Based Compensation Incentive awarded to each Qualifying <br /> Employee will be based on the gross wages of each Qualifying Employee during the <br /> Measurement Period. To each Qualifying Employee, the distribution would be allocated in a <br /> lump sum equal to the product of: a) the Multiplier; and b) 2%of that employee's gross wages <br /> 7.6 UTILITIES PERFORMANCE Page 2 of 3 Approved December 12, 2012 <br /> METRICS AND INCENTIVE <br /> COMPENSATION POLICY <br /> 131 <br />