Exhibit 10.1
PRIVILEGED AND
CONFIDENTIAL
July 30, 2008
[Name]
[Address]
Dear [Name]:
TECO Energy, Inc. (the
“Company”) considers it essential to the best interests
of its stockholders to foster the continuous employment of key
management personnel. In this connection, the Board of Directors of
the Company (the “Board”) recognizes that, as is the
case with many publicly held corporations, the possibility of a
change in control may exist and that such possibility, and the
uncertainty and questions which it may raise among management, may
result in the departure or distraction of key management personnel
to the detriment of the Company and its stockholders.
The Board has determined that
appropriate steps should be taken to reinforce and encourage the
continued attention and dedication of members of the
Company’s management, including yourself, to their assigned
duties without distraction in the face of potentially disturbing
circumstances arising from the possibility of a change in control
of the Company.
In order to induce you to remain in
the employ of the Company and in consideration of your agreement
set forth in Subsection 2(iii) hereof, the Company agrees that you
shall receive the severance benefits set forth in this letter
agreement (the “Agreement”) in the event your
employment with the Company is terminated subsequent to a
“change in control of the Company” (as defined in
Section 2(i) hereof) (or is deemed to be terminated subsequent
to a change in control of the Company in accordance with the second
sentence of Section 3 hereof) under the circumstances
described below. This agreement amends and restates the letter
agreement dated November 1, 2007 between you and the Company
(the “Prior Agreement”).
1. Term of Agreement . This
Agreement shall commence on the date hereof and shall continue in
effect through June 30, 2010; provided, however, that
commencing on July 1, 2009 and each July 1 thereafter,
the term of this Agreement shall automatically be extended for one
additional year unless, not later than March 31 of such year,
the Company shall have given notice that it does not wish to extend
this Agreement (provided that no such notice may be given during
the pendency of or within two years following a potential change in
control of the Company, as defined in Section 2(ii) hereof);
provided, further, if a change in control of the Company shall have
occurred during the original or extended term of this Agreement,
this Agreement shall continue in effect for a period of thirty-six
(36) months beyond the month in which such change in control
occurred.
2. Change in Control; Potential
Change in Control . (i) Except as provided in the second
sentence of Section 3 hereof, no benefits shall be payable
hereunder unless there shall have been a
change in control of the Company, as set forth
below. For purposes of this Agreement, a “change in control
of the Company” shall mean a change in control of a nature
that would be required to be reported in response to Item 6(e)
of Schedule 14A of Regulation 14A promulgated under the Securities
Exchange Act of 1934, as amended (the “Exchange Act”),
whether or not the Company is in fact required to comply therewith;
provided, that, without limitation, such a change in control shall
be deemed to have occurred if:
(A) any “person” (as
such term is used in Sections 13(d) and 14(d) of the Exchange Act),
other than the Company, any trustee or other fiduciary holding
securities under an employee benefit plan of the Company or a
corporation owned, directly or indirectly, by the stockholders of
the Company in substantially the same proportions as their
ownership of stock of the Company, is or becomes the
“beneficial owner” (as defined in Rule 13d-3 under the
Exchange Act), directly or indirectly, of securities of the Company
representing 30% or more of the combined voting power of the
Company’s then outstanding securities;
(B) the following
individuals cease to constitute a majority of the number of
directors then serving: individuals who on the date hereof
constitute the Board and any new director (other than a director
whose initial assumption of office is in connection with an actual
or threatened election contest, including but not limited to a
consent solicitation, relating to the election of directors of the
Company) whose election by the Board or nomination for election by
the stockholders of the Company was approved by a vote of at least
two-thirds ( 2 / 3 ) of the directors then
still in office who either were directors on the date hereof or
whose election or nomination for election was previously so
approved, cease for any reason to constitute a majority thereof;
or
(C) there is consummated a merger or
consolidation of the Company or any direct or indirect subsidiary
of the Company with any other corporation, other than (i) a
merger or consolidation resulting in the voting securities of the
Company outstanding immediately prior thereto continuing to
represent (either by remaining outstanding or by being converted
into voting securities of the surviving entity) at least 50% of the
combined voting securities of the Company or such surviving entity
or any parent thereof outstanding immediately after such merger or
consolidation or (ii) a merger or consolidation effected to
implement a recapitalization of the Company (or similar
transaction) in which no “person” (as hereinabove
defined) acquires 30% or more of the combined voting power of the
Company’s then outstanding securities; or
(D) the stockholders of the Company
approve a plan of complete liquidation of the Company or there is
consummated the sale or disposition by the Company of all or
substantially all of the Company’s assets.
(ii) For purposes of this Agreement,
a “potential change in control of the Company” shall be
deemed to have occurred if:
(A) the Company enters into an
agreement, the consummation of which would result in the occurrence
of a change in control of the Company;
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(B) any person (as hereinabove
defined), including the Company, publicly announces an intention to
take or consider taking actions which if consummated would
constitute a change in control of the Company;
(C) any person (as hereinabove
defined), other than the Company, any trustee or other fiduciary
holding securities under an employee benefit plan of the Company or
a corporation owned, directly or indirectly, by the stockholders of
the Company in substantially the same proportions as their
ownership of stock of the Company (a) is or becomes the
beneficial owner, (b) discloses directly or indirectly to the
Company or publicly a plan or intention to become the beneficial
owner, or (c) makes a filing under the Hart-Scott-Rodino
Antitrust Improvements Act of 1976, as amended, with respect to
securities to become the beneficial owner, directly or indirectly,
of securities representing 9.9% or more of the combined voting
power of the outstanding voting securities of the Company;
or
(D) the Board adopts a resolution to
the effect that, for purposes of this Agreement, a potential change
in control of the Company has occurred.
(iii) You agree that, subject to the
terms and conditions of this Agreement, in the event of a potential
change in control of the Company during the term of this Agreement
(as determined under Section 1 hereof), you will remain in the
employ of the Company until the earliest of (a) a date which
is one (1) year from the occurrence of such potential change
in control of the Company, (b) the termination by you of your
employment after you attain “normal retirement age”
under the provisions of the TECO Energy Group Retirement Plan or
any successor thereto (the “Retirement Plan”) or by
reason of death or Disability as defined in Section 3(i), or
(c) the date of the occurrence of a change in control of the
Company.
3. Termination Following Change
in Control . If your employment is terminated following a
change in control of the Company and during the term of this
Agreement, other than (A) by the Company for Cause,
(B) by reason of death or Disability, or (C) by you
without Good Reason, then the Company shall pay you the amounts,
and provide you the benefits, described in Section 4(iii)
hereof. For purposes of this Agreement, your employment shall be
deemed to have been terminated following a change in control of the
Company by the Company without Cause or by you with Good Reason, if
(i) your employment is terminated by the Company without Cause
prior to a change in control of the Company (whether or not such a
change in control ever occurs) and such termination was at the
request or direction of a “person” (as hereinabove
defined) who has entered into an agreement with the Company the
consummation of which would constitute a change in control of the
Company, (ii) you terminate your employment for Good Reason
prior to a change in control of the Company (whether or not such a
change in control ever occurs) and the circumstance
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or event which constitutes Good Reason occurs at
the request or direction of such person, or (iii) your
employment is terminated by the Company without Cause or by you for
Good Reason and such termination or the circumstance or event which
constitutes Good Reason is otherwise in connection with or in
anticipation of a change in control of the Company (whether or not
such a change in control ever occurs). Notwithstanding anything in
this Agreement to the contrary, you shall not be entitled to the
benefits provided in Section 4 hereof unless you have incurred
a “separation from service” under Section 409A of
the Code.
(i) Disability . If, as a
result of your incapacity due to physical or mental illness, you
shall have been absent from the full-time performance of your
duties with the Company for six (6) consecutive months, and
within thirty (30) days after written notice of termination is
given you shall not have returned to the full-time performance of
your duties, your employment may be terminated for
“Disability”.
(ii) Cause .
Termination by the Company of your employment for
“Cause” shall mean termination upon (A) the
willful and continued failure by you to substantially perform your
duties with the Company (other than any such failure resulting from
your incapacity due to physical or mental illness or any such
actual or anticipated failure after the issuance of a Notice of
Termination by you for Good Reason, as defined in Subsections 3(iv)
and 3(iii), respectively) after a written demand for substantial
performance is delivered to you by the Board, which demand
specifically identifies the manner in which the Board believes that
you have not substantially performed your duties, or (B) the
willful engaging by you in conduct which is demonstrably and
materially injurious to the Company, monetarily or otherwise. For
purposes of this Subsection, no act, or failure to act, on your
part shall be deemed “willful” unless done, or omitted
to be done, by you not in good faith and without reasonable belief
that your action or omission was in the best interest of the
Company. Notwithstanding the foregoing, you shall not be deemed to
have been terminated for Cause unless and until there shall have
been delivered to you a copy of a resolution duly adopted by the
affirmative vote of not less than three-quarters (
3 / 4 ) of the entire membership
of the Board at a meeting of the Board called and held for such
purpose (after reasonable notice to you and an opportunity for you,
together with your counsel, to be heard before the Board), finding
that in the good faith opinion of the Board you were guilty of
conduct set forth above in this Subsection and specifying the
particulars thereof in detail.
(iii) Good Reason .
“Good Reason” for termination by you of your employment
shall mean the occurrence (without your express written consent)
after any change in control of the Company, or prior to a change in
control of the Company under the circumstances described in the
second sentence of Section 3 hereof (treating all references
in paragraphs (A) through (H) below to a “change in
control of the Company” as references to a “potential
change in control of the Company”), of any one of the
following acts by the Company, or failures by the Company to
act:
(A) the assignment to you of any
duties inconsistent (except in the nature of a promotion) with the
position in the Company that you held immediately prior to the
change
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in control of the Company or a
substantial adverse alteration in the nature or status of your
position or responsibilities or the conditions of your employment
from those in effect immediately prior to the change in control of
the Company;
(B) a reduction by the Company in
your annual base salary as in effect on the date hereof or as the
same may be increased from time to time;
(C) the Company’s requiring
you to be based more than fifty (50) miles from the
Company’s offices at which you were principally employed
immediately prior to the date of the change in control of the
Company except for required travel on the Company’s business
to an extent substantially consistent with your present business
travel obligations;
(D) the failure by the Company to
pay to you any portion of your current compensation or compensation
under any deferred compensation program of the Company, within
seven (7) days of the date such compensation is
due;
(E) the failure by the Company to
continue in effect any material compensation or benefit plan in
which you participate immediately prior to the change in control of
the Company unless an equitable arrangement (embodied in an ongoing
substitute or alternative plan) has been made with respect to such
plan, or the failure by the Company to continue your participation
therein (or in such substitute or alternative plan) on a basis not
materially less favorable, both in terms of the amount of benefits
provided and the level of your participation relative to other
participants, than existed at the time of the change in
control;
(F) the failure by the Company to
continue to provide you with benefits substantially similar to
those enjoyed by you under any of the Company’s pension, life
insurance, medical, health and accident, or disability plans in
which you were participating at the time of the change in control
of the Company, the taking of any action by the Company which would
directly or indirectly materially reduce any of such benefits or
deprive you of any material fringe benefit enjoyed by you at the
time of the change in control of the Company, or the failure by the
Company to provide you with the number of paid vacation days to
which you are entitled on the basis of your years of service with
the Company in accordance with the Company’s normal vacation
policy in effect at the time of the change in control of the
Company;
(G) the failure of the Company to
obtain a satisfactory agreement from any successor to assume and
agree to perform this Agreement, as contemplated in Section 6
hereof; or
(H) any purported termination of
your employment which is not effected pursuant to a Notice of
Termination satisfying the requirements of Subsection
(iv) below (and, if applicable, the requirements of Subsection
(ii) above), which purported termination shall not be
effective for purposes of this Agreement.
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Your right to terminate your employment pursuant
to this Subsection shall not be affected by your incapacity due to
physical or mental illness. Your continued employment shall not
constitute consent to, or a waiver of rights with respect to, any
circumstance constituting Good Reason hereunder.
(iv) Notice of Termination .
Any purported termination of your employment by the Company or by
you shall be communicated by written Notice of Termination to the
other party hereto in accordance with Section 7 hereof. For
purposes of this Agreement, a “Notice of Termination”
shall mean a notice which shall indicate the specific termination
provision in this Agreement relied upon and shall set forth in
reasonable detail the facts and circumstances claimed to provide a
basis for termination of your employment under the provision so
indicated.
(v) Date of Termination, Etc
. “Date of Termination” shall mean (A) if your
employment is terminated for Disability, thirty (30) days
after Notice of Termination is given (provided that you shall not
have returned to the full-time performance of your duties during
such thirty (30) day period), and (B) if your employment
is terminated pursuant to Subsection (ii) or (iii) above
or for any other reason (other than Disability), the date specified
in the Notice of Termination (which, in the case of a termination
pursuant to Subsection (ii) above shall not be less than
thirty (30) days, and in the case of a termination pursuant to
Subsection (iii) above shall not be less than fifteen
(15) nor more than sixty (60) days, respectively, from
the date such Notice of Termination is given); provided that if
within fifteen (15) days after any Notice of Termination is
given, or, if later, prior to the Date of Termination (as
determined without regard to this proviso), the party receiving
such Notice of Termination notifies the other party that a dispute
exists concerning the termination, the Date of Termination shall be
the date on which the dispute is finally determ
