Exhibit 10.7
TECO ENERGY, INC.
VOLUNTARY RETIREMENT AGREEMENT
AND GENERAL RELEASE
THIS AGREEMENT AND GENERAL RELEASE (the "Agreement") is dated as
of April 23, 1999, by and between A. D. Oak (the "Officer") and TECO
Energy, Inc., whose address is 000 Xxxxx Xxxxxxxx Xxxxxx, Xxxxx,
Xxxxxxx 00000 (the "Company").
WHEREAS, the Officer is currently employed in the position of
Executive Vice President and Chief Operating Officer; and
WHEREAS, the Officer has elected to take early retirement under
the terms of this Agreement as of May 1, 1999, and;
WHEREAS, in recognition of the Officer's service to the Company,
the Company desires to extend certain benefits and to make certain
payments to the Officer; and
WHEREAS, the parties have mutually agreed to enter into this
Agreement.
NOW, THEREFORE, in consideration of the mutual covenants herein
contained, it is agreed as follows:
1. RETIREMENT DATE
(a) The Officer hereby notifies the Company of his intention to
retire from the Company effective as of May 1, 1999 (the "Retirement
Date").
(b) The Officer and the Company agree to cooperate in the
development of joint internal and external announcements prior to the
Retirement Date in connection with his retirement. Upon issuance of
such announcements, the Officer agrees that he will coordinate with
the Company in responding to all inquiries from the news media.
Without limitation of the foregoing, the Company and the Officer have
agreed to address the misleading statements attributed to a Company
spokesman in the Tampa Tribune article dated April 28, 1999, by
sending the letter to the Business Editor of the Tampa Tribune dated
April 29, 1999, a copy of which has been provided to Officer.
(c) From time to time after the Retirement Date, the Company
shall direct all inquiries from a potential employer of the Officer to
the Vice President - Human Resources who will respond to such
inquiries in a positive manner, and upon request of the Officer, shall
provide a positive letter of recommendation.
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2. COMPENSATION AND BENEFITS
(a) Within ten (10) days following the Retirement Date, the
Company shall make payments to the Officer as follows:
(i) a lump-sum payment for his accrued but unused vacation
allowance for 1999, and any accrued vacation allowance
for 2000, as specified in Administrative Policy I.3.1,
Paragraph III B;
(ii) a lump-sum payment comprised of the following:
(x) an amount equal to two and one-half (2.5) times
the sum of the Officer's base salary as of the
Retirement Date and the average of his incentive
payments for calendar years 1997 and 1998; and
(y) an amount equal to the present value of two (2)
additional years of age and service credit under the
Officer's Supplemental Executive Retirement Plan (the
"SERP").
(iii) a payment equal to the present value of the
Officer's SERP as of the Retirement Date, paid as a
lump-sum in accordance with the Officer's election.
(b) The restrictions upon all of the restricted stock granted to
the Officer under the TECO Energy, Inc. 1996 Equity Incentive Plan
shall terminate, and all of such restricted stock shall vest for the
benefit of the Officer, as of the Retirement Date, subject to the
provisions of such plan.
(c) All of the Officer's outstanding TECO Energy, Inc. stock
options shall remain exercisable by the Officer at any time on or
before the expiration date specified for each applicable stock option
grant, in accordance with the provisions of such grant.
(d) All benefits granted or amounts paid by the Company as
provided in Sections 2(a) and (b) above shall be reduced by the amount
of applicable FICA and federal withholding taxes.
(e) Immediately prior to the Retirement Date, the Officer and
his dependents, Xxxxx Oak, Xxxxx Oak and Alison Oak (collectively, the
"Covered Individuals") were covered under the Company's medical,
hospitalization and dental benefit plan (the "Existing Plan"). After
the Retirement Date, the Company shall provide to the Covered
Individuals the same medical, hospital and dental coverage and
benefits as the Company provides to other retired employees of the
Company (the "Plans"), as such Plans may change from time to time;
provided, however, no such Plan change shall have the effect of
rendering Xxxxx Oak ineligible to be covered thereunder as a dependent
of the Officer. The Company's obligations under this Section 2(e)
shall continue, with respect to Alison Oak, until she no longer
qualifies as a dependent of the Officer under the Plans, and shall
continue, with respect to each of the other Covered Individuals, until
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his or her death; provided, however, the Company's obligations
pursuant to this Section 2(e) shall expire with respect to a Covered
Individual if, after the Retirement Date, such Covered Individual
obtains comparable coverage (including coverage for preexisting
conditions, if any) under another medical, hospitalization and dental
plan. The Officer shall pay the Company either directly or as a
deduction from any monthly retirement benefits due to him, for the
coverage provided pursuant to this Section 2(e), on a monthly basis,
an amount calculated in the manner which is the same for any other
officer who had attained 27 years of service with the Company as of
the Retirement Date.
3. CONFIDENTIALITY AND OTHER CONDUCT
(a) The Officer recognizes and acknowledges that during the
course of his employment with the Company, he has developed,
participated in the development of, been exposed to, has had access
to, and has had disclosed to him information and material developed
specifically by and for the benefit of the Company (including its
parent company and other subsidiaries), sensitive and/or proprietary
information, strategic planning and financial information, business
planning, operations and marketing information, and personnel and
plant security information, and, in each case, specific Company
policies, practices and procedures related thereto and other matters,
including without limitation trade secrets, trademarks, service marks,
trademarked and copyrighted material, patents, patents pending,
financial and data processing information, data bases, interfaces,
and/or source codes, Company procedures, specifications, commercial
information or other Company or Customer records as described in
Administrative Policies I.8.7. and I.1.28, including any information
or material, belonging to others which has been provided to the
Company on a confidential basis, all of which are hereinafter referred
to as "Confidential Information."
(b) The Officer agrees to maintain, in strict confidence, the
Confidential Information and agrees not to disclose the Confidential
Information or the terms of or the amount of the consideration paid as
part of this Agreement to any third party or to use the Confidential
Information to benefit himself or any third party. The Officer shall
b e p rohibited from using, duplicating, reproducing, copying,
distributing or disclosing the Confidential Information regardless of
form or purpose, including without limitation verbal disclosure, data,
documents, electronic media or any other media form. The Officer also
agrees to continue to abide by the non-disclosure and non-use
obligations relating to Company records, information, and property
contained in the Company's Standards of Integrity.
(c) The restrictions on the Officer's disclosure of Confidential
Information set out herein do not apply to such information which (i)
is now, or which hereafter, through no act or failure to act on the
part of the Officer becomes, generally known or available to the
public; or (ii) is required to be disclosed by a court of competent
jurisdiction or by an administrative or quasi-judicial body having
jurisdiction over the subject matter after the Officer has given the
Company reasonable prior notice of such disclosure requirement.
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(d) The Officer agrees to conduct himself in all actions or
conduct relating to the Company in a manner consistent with existing
Company policy and to refrain from engaging in any conduct or activity
that in any manner harasses or interferes with the Company, its
employees, officers and/or directors or holds the Company up to
ridicule in the community or which jeopardizes or adversely affects
the business or reputation of the Company. Likewise the Company
agrees to conduct itself in all actions or conduct relating to the
Officer in a manner consistent with the existing Company policy and to
refrain from engaging in any conduct or activity that in any manner
harasses or disparages the Officer, holds him up to ridicule in the
community, or jeopardizes or adversely affects his reputation.
(e) The Officer hereby waives all rights to employment with the
Company and agrees not to seek employment with the Company at any time
in the future.
4. COMPETITION
(a) C o venant Not to Compete. The Officer, directly or
indirectly, in any capacity, either for himself, or on behalf of any
corporation, partnership, joint venture, business trust, or other
person or entity, shall not:
For a period of two (2) years commencing on the date of this
Agreement ("Prohibited Period"), (i) (a) engage in any business, or
acquire an interest in any business as a director or officer, partner,
stockholder, proprietor or otherwise (except as the beneficial owner
of publicly-traded stock), or become affiliated as an agent or
consultant of or provide any consulting services to any business or
activity having its principal place of business within the State of
Florida that is in competition with any business or material activity
in which the Company is engaged or planning to be engaged as of the
Retirement Date, or (b) engage in, or provide services with respect
to, strategic planning, marketing and sales in the State of Florida
for any such business or material activity regardless of its principal
place of business; ("Competitor"); (ii) solicit, divert, do business
with, or accept business from any person who is or has been a customer
of the Company if such solicitation, diversion or business has the
effect of or results in the Company's loss of all or a portion of such
customer's business or potential business; (iii) represent any person
in its dealings with the Company; (iv) influence or attempt to
influence any employee of the Company to terminate his/her employment
with the Company; or (v) influence or attempt to influence any agent,
customer, supplier, or distributor who has a business relationship
with the Company to cease or adversely alter its business relations
with the Company.
(b) Consideration. In consideration for Officer's agreement to
the preceding covenant not to compete set forth in Section 4(a) above,
the Company agrees to pay the Officer FOUR HUNDRED THOUSAND AND NO/100
DOLLARS ($400,000.00) payable quarterly in the amount of FIFTY
THOUSAND AND NO/100 DOLLARS ($50,000.00). Such payments shall be due
throughout the Prohibited Period so long as the Officer adheres to the
covenant not to compete set forth in Section 4(a) hereof, breach of
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which shall entitle the Company to cease making such payments during
the period of such breach in addition to the other remedies set forth
in Section 6 hereof. Such payments shall be made on the first day of
the month immediately following the last day of each calendar quarter.
The first payment hereunder shall be due on July 1, 1999.
The Officer's covenant not to compete pursuant to Section 4(a) is
independent of any obligation of the Company to the Officer, including
any obligation of the Company to the Officer under this Agreement
other than its obligation to make payment under Section 4(b) hereof,
and is not subject to any setoff, defense, deduction, or counterclaim
based on any claim that the Officer might have against the Company
other than a claim arising out of non-payment by the Company of the
amounts specified in Section 4(b) hereof. The Officer stipulates that
the geographic scope, duration, and the related restrictions are
reasonable limitations necessary to protect the Company's business
interests, and such restrictions do not unreasonably prevent the
O f ficer from obtaining acceptable professional or occupational
employment opportunities. The Officer acknowledges that his position
with the Company has given him access to the Confidential Information
defined herein, certain specialized knowledge and training not readily
available to him otherwise, and that he has been directly and
indirectly responsible for, participated in and contributed to the
development of and managed certain of the Company's marketing and
competitive business strategies. The Prohibited Period covering the
obligations set forth in Section 4(a) above shall be extended by any
period of time during which the Officer is in breach of such
obligation.
(c) Reformation. Each provision of the covenant set forth in
Section 4(a) shall be construed and interpreted so that it is valid
and enforceable under applicable law. However, if a court of
competent jurisdiction determines that the duration, geographical
area, or proscribed activities contained in the restrictions under
this Agreement would cause strict application of those restrictions to
be invalid or unenforceable in a particular jurisdiction, the
restrictions automatically will be reformed to shorten their duration,
x x xxxxxx their geographical area, or confine their proscribed
activities to the extent necessary (but only to such extent) to make
the restrictions valid and enforceable.
5. RELEASE OF CLAIMS AND INDEMNIFICATION
(a) For and in consideration of the payments and increased
benefits made to the Officer pursuant to Section 2 hereof, the
Officer, for himself, his heirs, executors, administrators, successors
and assigns, hereby releases and agrees to hold harmless the Company
(which, for purposes of this section includes the Company and any
agent, officer, director or employee thereof) from all claims, rights,
causes of action or liabilities of whatever nature, whether at law or
in equity, against the Company that the Officer, his heirs, executors,
administrators, successors, and assigns, may now have or hereafter
can, shall or may have for, upon, or by reason of any matter, cause or
thing, whatsoever, which has happened, developed or occurred on or
before the date of this Agreement, arising out of Officer's employment
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with or termination of employment from the Company hereunder,
including, but not limited to, claims for wrongful termination,
discrimination, retaliation, invasion of privacy, defamation, slander,
and/or intentional infliction of emotional distress and those claims
arising under any federal, state, or local discrimination or civil
rights or labor laws and/or rules or regulations, and/or common law,
whether in contract or in tort, as they relate to the employment
relationship of the Employee/Employer (including without limitation
claims arising under the Age Discrimination in Employment Act, the
Older Workers' Benefit Protection Act (29 USC 626), Title VII of the
Civil Rights Act of 1964, or the Employee Retirement Income Security
Act, as such laws have been or may be amended from time to time);
provided, however, nothing herein shall constitute a release by the
Officer of any claim he may have arising under this Agreement, under
the SERP, or under the various restricted stock agreements and stock
option agreements to which he is a party.
(b) In consideration of the mutual covenants herein contained,
and for other good and sufficient consideration, receipt whereof is
hereby acknowledged, the Company, for itself, its subsidiaries and
affiliates, and all of their respective successors and assigns, hereby
releases and discharges the Officer from all claims, rights, causes of
action or liabilities of whatever nature, whether at law or in equity,
against the Officer that the Company, its subsidiaries and affiliates,
or any of their respective successors and assigns may now have or
hereafter can, shall or may have for, upon, or by reason of any
matter, cause or thing, whatsoever, which has happened, developed or
occurred on or before the date of this Agreement, arising out of the
Officer's employment with or termination of employment from the
Company hereunder; provided, however, nothing herein shall constitute
a release by the Company of any claim it may have against the Officer
arising under this Agreement.
(c) E a ch party hereto acknowledges and agrees that this
Agreement shall not be construed as an admission by the other party of
any improper or unlawful actions or of any wrongdoing whatsoever
against such party or any other persons, and each party expressly
denies any wrongdoing whatsoever against the other party or any other
employee.
(d) The Officer covenants with and represents to the Company
that he is the sole owner of any and all claims being waived and from
which the Company is being released by the Officer in Section 5(a)
above. The Company covenants with and represents to the Officer that
it is the sole owner of any and all claims being waived and from which
the Officer is being released by the Company in Section 5(b) above.
Each party hereby covenants with and agrees to indemnify and save and
hold harmless the other party against any and all liability, claims,
suits, damages, costs, losses and expenses whatsoever, in any manner
resulting from or arising out of the matters released above. The
Company agrees to indemnify and save and hold harmless the Officer in
accordance with the provisions of the Company's Bylaws in effect from
time to time and applicable to any other officer who is then actively
employed by the Company, to the extent permitted by law, against all
expenses and liabilities incurred in connection with any threatened,
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pending or completed proceeding to which the Officer is or becomes a
party by reason of the fact that he was an officer or employee of the
Company. The Company's obligation to indemnify the Officer hereunder
is subject to the Officer providing the Company with prompt written
notice of any threatened or existing suit, proceeding or claim.
6. REMEDIES
(a) Remedy at Law Insufficient. The parties acknowledge that
damages at law will be an insufficient remedy if: Officer violates the
terms of Sections 3 and 4 hereof or if the Company or Officer breach
the covenants contained in Sections 1 and 5 hereof, or if the Company
inappropriately fails to make the payments pursuant to Section 2
hereof, and that each would suffer irreparable damage as a result of
such violation. Accordingly, upon a violation of any of the covenants
set out in such Sections applicable to the parties, the affected
party, either Officer or the Company without excluding or limiting any
other available remedy, shall be entitled to seek from a court of
competent jurisdiction the following remedies:
(1) Upon posting reasonable bond and filing with a court of
c o m p etent jurisdiction an appropriate pleading and affidavit
specifying each obligation breached by Officer or the Company,
appropriate injunctive relief or specific performance compelling the
defaulting party or parties to comply with that obligation, without
proof of monetary damage or an inadequate remedy at law; and
(2) Reimbursement of all reasonable costs and expenses
reasonably incurred by the non-defaulting party in enforcing those
obligations or otherwise defending or prosecuting any litigation
arising out of the defaulting party's obligations, including premiums
for bonds, fees for experts and investigators, and legal fees, costs,
and expenses incurred before a lawsuit is filed and in trial,
appellate, bankruptcy and judgment execution proceedings.
(b) Cumulative Remedies. The foregoing remedies are cumulative
and in addition to all other remedies afforded or available to the
parties by law or in equity, and the parties may exercise any such
remedy concurrently, independently or successively.
(c) Attorneys' Fees. In the event that either party is required
to institute litigation or some other alternative dispute resolution
process (other than the proceedings contemplated in Section 6(a)
above) in order to enforce the terms of this Agreement, the prevailing
party shall be entitled to recover its reasonable attorney's fees and
costs from the other party.
7. SURVIVAL
Neither completion of payments hereunder nor termination of this
Agreement shall be deemed to relieve Officer or Company of any rights
or obligations hereunder which by their very nature survive the
completion of payments by the Company, including without limitation,
Sections 1(b), 1(c), 2(b), 2(c), 2(e), 3, 4, 5 and 6 hereof. For the
purpose of this Agreement, the term "Company" shall mean TECO Energy,
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Inc. and all of its subsidiaries and affiliates.
8. ENTIRE AGREEMENT
Except as provided below, the Officer acknowledges and agrees
that this Agreement contains the entire agreement between himself and
Company and that no statements or promises have been made by either
party concerning the subjects of this Agreement other than as
expressly contained in this document. Notwithstanding the foregoing,
the Officer's SERP and all of the restricted stock and stock option
agreements between the Officer and the Company shall expressly survive
the execution and delivery of this Agreement in accordance with their
respective terms, as modified by the provisions of Sections 2(b) and
2(c) hereof.
9. EFFECTIVE DATE
This Agreement shall be governed by the Laws of the State of
Florida and shall become effective at the close of business on the
seventh (7th) day following the date of this Agreement.
10. AUTHORITY OF COMPANY TO ENTER INTO THIS AGREEMENT
The provisions of Sections 2(b) and 2(c) and the matters covered
by this Agreement have been duly authorized by the Board of Directors
of the Company at its meeting held on April 21, 1999.
11. FURTHER ASSURANCES
Each party hereto shall cooperate with the other party and shall
take such further action and shall execute and deliver such further
documents as may be reasonably requested by any other party in order
to carry out the provisions and purposes of this Agreement.
12. STATEMENT OF UNDERSTANDING
THE OFFICER ACKNOWLEDGES THAT (A) HE HAS CAREFULLY READ THIS
AGREEMENT AND RELEASE, KNOWS AND UNDERSTANDS THE CONTENTS CONTAINED IN
IT AND HAS BEEN GIVEN THE OPPORTUNITY TO CONSIDER THIS AGREEMENT FOR
TWENTY-ONE (21) DAYS AND (B) THE COMPANY HAS ADVISED HIM TO CONSULT AN
ATTORNEY AND HE HAS BEEN GIVEN THE OPPORTUNITY TO DO SO. THE OFFICER
DOES FREELY AND VOLUNTARILY ASSENT TO ALL OF ITS TERMS AND CONDITIONS
AND SIGNS THIS AGREEMENT AS HIS OWN FREE ACT, AND UNDERSTANDS THAT HE
HAS THE RIGHT TO RESCIND THIS AGREEMENT DURING THE SEVEN-DAY PERIOD
DISCLOSED IN SECTION 9 ABOVE.
If the Officer chooses to waive the 21-day requirement, please
indicate by initialing and dating the following paragraph in the space
provided in the left margin.
THE OFFICER DOES HEREBY WAIVE THE TWENTY-ONE (21) DAY PERIOD TO
____ CONSIDER THIS AGREEMENT AS REQUIRED UNDER THE OLDER WORKERS'
Initial BENEFIT PROTECTION ACT (29 USC '626), BUT ACKNOWLEDGES THAT HE HAS
____ REVIEWED AND CONSIDERED THIS AGREEMENT, HAS CONSULTED WITH
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HIS
Date ATTORNEY AND FREELY AND VOLUNTARILY ASSENTS TO ALL OF ITS
TERMS AND CONDITIONS AND SIGNS THIS AGREEMENT AS HIS OWN FREE ACT.
IN WITNESS WHEREOF, TECO Energy, Inc. and Xxxx X. Oak, have
caused this instrument to be executed in Tampa, Florida as of the date
first written above.
WITNESSES: TECO ENERGY, INC., A FLORIDA
CORPORATION
By: /s/ Xxxxxx X. Xxxxxxxx
Name: Xxxxxx X. Xxxxxxxx
Title: President and Chief Executive
Officer
CAUTION! READ BEFORE SIGNING
By: /s/ Xxxx X. Oak
Name: Xxxx X. Oak
Date Signed: April 30, 1999
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