Exhibit 10.1
STOCK PURCHASE AGREEMENT
This Stock Purchase Agreement (the "Agreement") is made as of September 10,
2003 by and between the undersigned purchasers (each, a "Purchaser" and
collectively, "Purchasers") and TECO Energy, Inc., a Florida corporation (the
"Company"). The parties agree as follows:
1. Purchase and Sale of Shares. Subject to the terms and conditions hereof,
Purchasers shall buy from the Company and the Company shall sell to Purchasers
an aggregate of 11,000,000 shares (the "Shares") of the Company's common stock,
par value $1.00 per share, at a price of $11.76 per share for an aggregate
purchase price of $129,360,000 (the "Purchase Price"). The closing of such
purchase and sale (the "Closing" shall take place at the offices of Xxxxxx &
Dodge LLP, Boston, Massachusetts, at 9:00 a.m. on the later of (i) the third
(3rd) business day after the date hereof and (ii) the next business day after
the Shares have been approved for listing on The New York Stock Exchange
("NYSE"), subject to notice of issuance, or at such other time or on such other
date as the parties shall have agreed (the "Closing Date"). Upon Closing, the
Company shall cause the Shares to be electronically delivered to The Depository
Trust Company on Purchasers' behalf in the respective amounts set forth opposite
Purchasers' names on the signature page hereof and registered in such names as
Purchasers shall, with reasonable notice, have designated, against payment of
the full Purchase Price in federal funds by wire transfer to a bank account
designated by the Company.
2. Representations of the Company. In order to induce Purchasers to purchase
the Shares, the Company hereby represents and warrants to Purchasers as follows:
2.1 The Company and each "significant subsidiary" (as such term is defined
in Rule 1-02 of Regulation S-X) of the Company (each, a "Significant
Subsidiary") has been duly incorporated and is an existing corporation in good
standing under the laws of the State of Florida or, in the case of any
Significant Subsidiary, its respective jurisdiction of incorporation, with power
and authority (corporate and other) to own its properties and conduct its
business as described in the Prospectus; and the Company and each Significant
Subsidiary is duly qualified to do business as a foreign corporation in good
standing in all other jurisdictions in which its ownership or lease of property
or the conduct of its business requires such qualification, except in any case
where the failure to be so qualified would not have a material adverse effect on
the condition (financial or other), business, properties or results of
operations of the Company and its subsidiaries taken as a whole (a "Material
Adverse Effect").
2.2 The Company has full power and authority to authorize, issue and sell
the Shares as contemplated by this Agreement. This Agreement has been duly
authorized, executed and delivered by the Company. The Shares, when issued and
delivered in accordance with this Agreement, will be validly issued, fully paid
and nonassessable.
2.3 Except for the approval of the Shares for listing on NYSE, no consent,
approval, authorization, or order of, or filing, registration or qualification
with, any governmental agency or body or any court is required for the
performance by the Company of its obligations hereunder or in connection with
the consummation of the issuance and sale of the Shares, except such as
have been obtained and made under the Act and such as may be required under
state securities laws.
2.4 The execution, delivery and performance of this Agreement by the
Company and the issuance and sale of the Shares will not result in a breach or
violation by the Company or any Significant Subsidiary of any of the terms and
provisions of, or constitute a default under (a) any statute, rule, regulation
or order of any governmental agency or body or any court having jurisdiction
over the Company or any of its property or any Significant Subsidiary or any of
their respective properties, (b) any agreement or instrument to which the
Company or any Significant Subsidiary is a party or by which the Company or any
Significant Subsidiary is bound or to which any of the properties of the Company
or any Significant Subsidiary is subject, except for breaches, defaults or
violations that would not result in a Material Adverse Effect or (c) the charter
or by-laws of the Company or of any Significant Subsidiary.
2.5 A registration statement (No. 333-102018) relating to the Shares has
been filed with the Securities and Exchange Commission (the "Commission") and
has been declared effective. Such registration statement, as amended at the date
of this Agreement and including all material incorporated by reference therein,
meets the requirements set forth in Rule 415(a)(1)(x) under the Securities Act
of 1933, as amended (the "Act"), and is herein referred to as the "Registration
Statement," and the prospectus included in the Registration Statement, as first
filed with the Commission pursuant to and in accordance with Rule 424(b) ("Rule
424(b)") under the Act and as amended to reflect the terms of the offering of
the Shares, including all material incorporated by reference therein, is
hereinafter referred to as the "Prospectus." On its effective date, the
Registration Statement conformed in all respects to the requirements of the Act
and the rules and regulations of the Commission (the "Rules and Regulations")
and did not include any untrue statement of a material fact or omit to state any
material fact required to be stated therein or necessary to make the statements
therein not misleading, and as of the date hereof, the Registration Statement
and the Prospectus conform in all respects to the requirements of the Act and
the Rules and Regulations, and neither of such documents includes any untrue
statement of a material fact or omits to state any material fact required to be
stated therein or necessary to make the statements therein not misleading,
except that the foregoing does not apply to statements in or omissions from any
such documents based upon written information, if any, relating to any Purchaser
furnished to the Company by a Purchaser specifically for use therein. No stop
order suspending the effectiveness of the Registration Statement is in effect,
and no proceedings for such purpose are pending before or threatened by the
Commission.
2.6 Except as disclosed in the Prospectus, there are no pending actions,
suits or proceedings against or involving the Company or any of its property,
any of its subsidiaries or any of their respective properties that could
reasonably be expected to have, individually or in the aggregate, a Material
Adverse Effect, or that would materially and adversely affect the ability of the
Company to perform its obligations under this Agreement, or that are otherwise
material in the context of the sale of the Shares; and, to the Company's
knowledge, no such actions, suits or proceedings are threatened or contemplated.
2.7 The financial statements of the Company, together with the related
notes to such financial statements, included or incorporated by reference in the
Registration Statement and Prospectus present fairly in all material respects
the financial position of the Company and its
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consolidated subsidiaries as of the dates shown and their results of operations
and cash flows for the periods shown and, except as otherwise disclosed in the
Prospectus, such financial statements have been prepared in conformity with
generally accepted accounting principles in the United States applied on a
consistent basis (except as stated therein); and any schedules included or
incorporated by reference in the Registration Statement present fairly in all
material respects the information required to be stated therein.
2.8 Except as disclosed in the Prospectus, since the date of the latest
audited financial statements included or incorporated by reference in the
Registration Statement, there has been no material adverse change in the
condition (financial or other), business, properties or results of operations of
the Company and its subsidiaries taken as a whole.
2.9 The Company is not and, after giving effect to the sale of the Shares
and the application of the proceeds thereof as described in the Prospectus, will
not be an "investment company" as defined in the Investment Company Act of 1940,
as amended.
3. Representations of Purchasers. Each Purchaser hereby represents and
warrants to the Company that (a) it has been duly organized and is existing in
good standing as the type of entity and under the laws of the state set forth
under its respective name on the signature page hereof, (b) it has full power
and authority to enter into this Agreement and to consummate the transactions
contemplated hereby, and (c) this Agreement has been duly authorized, executed
and delivered by such Purchaser.
4. Conditions to the Parties' Obligation to Close.
4.1 The obligation of the Company to issue and sell the Shares at the
Closing is subject to the satisfaction (or waiver by the Company), at or before
the Closing Date, of each of the following conditions:
(a) The Shares shall have been approved for listing on the NYSE,
subject to notice of issuance.
(b) No stop order suspending the effectiveness of the Registration
Statement or any part thereof shall have been issued and no proceedings for that
purpose shall have been instituted.
(c) No action, suit or proceeding shall be pending against or involve
the Company or any of its property, any of its subsidiaries or any of their
respective properties that would materially and adversely affect the ability of
the Company to perform its obligations under this Agreement or that is otherwise
material in the context of the sale of the Shares and no such action, suit or
proceeding shall be threatened or contemplated.
(d) An aggregate of 11,000,000 Shares shall be purchased at the
Closing.
4.2 The obligation of Purchasers to purchase the Shares from the Company
at the Closing is subject to the satisfaction (or waiver by Purchasers), at or
before the Closing Date, of each of the following conditions:
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(a) The Shares shall have been approved for listing on the NYSE,
subject to notice of issuance.
(b) The Company shall have filed with the Commission pursuant to Rule
424(b) a prospectus supplement regarding the sale of the Shares.
(c) No stop order suspending the effectiveness of the Registration
Statement or any part thereof shall have been issued and no proceedings for that
purpose shall have been instituted.
(d) The representations and warranties of the Company contained in
Section 2 hereof shall be true, correct and complete in all material respects as
of the date hereof and as of the Closing Date as though made at that time
(except for representations and warranties that speak as of a specific date,
which shall be true, correct and complete as of such date), and the Company
shall have performed, satisfied and complied in all material respects with the
covenants and conditions required hereby to be performed, satisfied or complied
with by it at or before the Closing.
(e) Purchasers shall have received a certificate, dated the Closing
Date, of a duly authorized officer of the Company certifying on behalf of the
Company that each of the conditions set forth in subsections 4.2(a), (b), (c)
and (d) have been satisfied.
(f) Purchasers shall have received an opinion, dated the Closing
Date, of Xxxxxx & Dodge LLP, counsel for the Company, reasonably satisfactory in
form and substance to Purchasers with respect to the matters described in
Exhibit A hereto. In giving such opinion, such counsel may limit its opinion to
the laws of the Commonwealth of Massachusetts, the State of Florida and the
federal law of the United States and may rely as to matters of Florida law upon
an opinion of Xxxxxx X. XxXxxxxx, Esq., Senior Vice President and General
Counsel of the Company.
5. Standstill Agreement. In order to induce the Company to issue and sell the
Shares to Purchasers, each Purchaser agrees that:
5.1 For so long as it (together with all investment companies and all
entities that would be investment companies but for the provisions of Section
3(c) of the Investment Company Act of 1940, as amended, having a common
investment adviser and/or investment adviser under common control with such
Purchaser (collectively, "Affliates")) Beneficially Owns (as such term is
defined in Rule 13d-3 under the Exchange Act) an aggregate of five (5) percent
or more of the outstanding securities of the Company entitled to vote (including
securities convertible into or exercisable or exchangeable or redeemable for
such securities, collectively, "Voting Securities"), it will not, directly or
indirectly (unless in any such cases specifically invited in writing to do so by
the Company), do any of the following (except as required pursuant to or
otherwise contemplated by this Agreement or as a result of any stock split,
stock dividend, stock repurchase or similar recapitalization by the Company):
(a) acquire, offer to acquire, or agree to acquire by purchase or
otherwise, individually or by joining a partnership, limited partnership,
syndicate or other "group" (as such term is used in Section 13(d)(3) of the
Exchange Act) (any such act, to "acquire"), any Voting
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Securities or any options, warrants or other rights to acquire Voting Securities
if, after such acquisition, Purchaser and its Affiliates would Beneficially Own
in the aggregate more than nine and nine-tenths (9.9) percent of the outstanding
Voting Securities;
(b) make, or in any way participate in, directly or indirectly, any
"solicitation" of "proxies" (as such terms are defined or used in Regulation 14A
under the Exchange Act) or become a "participant" in any "election contest" (as
such terms are defined or used in Rule 14a-11 under the Exchange Act) with
respect to the Company (other than by way of Purchaser's exercising its right to
vote his or her Voting Securities), or initiate, propose or otherwise solicit
shareholders of the Company for the approval of one or more shareholder
proposals with respect to the Company, or induce or attempt to induce any other
person to initiate any shareholder proposal;
(c) deposit any Voting Securities into a voting trust or subject them
to any voting agreement or other agreement or arrangement with respect to the
voting of such Voting Securities;
(d) form, join, participate in or encourage the formation of a
partnership, limited partnership, syndicate or other group for the purpose of
acquiring, holding or disposing of Voting Securities; provided, however, for
purposes of this Section 5(d), Purchaser and its affiliates shall not be
considered to be a syndicate or other group;
(e) act, directly or indirectly, alone or in concert with others, to
seek to control the management, Board of Directors, policies or affairs of the
Company or any of its subsidiaries, or solicit, propose, seek to effect or
negotiate with any other person with respect to any form of business combination
transaction involving, directly or indirectly, the Company or any of its
subsidiaries, or any restructuring, recapitalization or similar transaction with
respect to the Company or any of its subsidiaries, or announce or disclose an
intent, purpose, plan or proposal with respect to the Company or any of its
subsidiaries or any Voting Securities inconsistent with the provisions of this
Section 5, including an intent, purpose, plan or proposal that is conditioned on
or would require the Company to waive the benefit of or amend any provision of
this Section 5, or assist, participate in, facilitate or encourage or solicit
any effort or attempt by any person to do or seek to do any of the foregoing;
(f) nominate any person for election by the holders of Common Stock
as a director of the Company who is not nominated by the then-incumbent
directors, or propose any matter to be voted upon by the stockholders of the
Company; or
(g) encourage or render advice to or make any recommendation or
proposal to any person, or directly or indirectly participate, aid and abet or
otherwise induce any person or engage in any of the actions prohibited by this
Section 5 or to engage in any actions inconsistent with the provisions of this
Section 5.
5.2 For so long as it Beneficially Owns any Voting Securities, it will
not, directly or indirectly (unless in any such cases specifically invited in
writing to do so by the Company), do either of the following:
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(a) sell, contract to sell or grant any option or right to purchase
any Common Stock or make any short sale of, or establish a "put equivalent
position" (as such term is defined in Rule 16a-1(h) under the Exchange Act) with
respect to, the Common Stock, at a time when Purchaser has no equivalent
offsetting long position in Common Stock; or
(b) sell or contract to sell more than one (1) percent of the
outstanding Voting Securities to any single person or group of related persons;
provided, however, that this subsection shall not apply to any transaction
effected in good faith on the NYSE.
5.3 In the event that any action is submitted to the holders of Voting
Securities for their approval, whether at a meeting or by written consent, at a
time when Purchaser and its Affiliates collectively have the right to vote or
direct the vote with respect to more than five (5) percent of the Voting
Securities entitled to vote on such action, Purchaser will, unless otherwise
approved in writing in advance by the Company, cause to be voted all Voting
Securities as to which it has the right to vote or direct the vote (but not more
than the number of Voting Securities by which such collective ownership exceeds
five (5) percent of the outstanding Voting Securities entitled to be voted on
such matter) (the "Excess Voting Securities") in the same manner (i.e. in favor
of, against and abstentions with respect to) proportionately to all other Voting
Securities that are entitled to vote with respect to such matter. Purchaser
hereby appoints the Chief Executive Officer and the Chief Financial Officer of
the Company, acting severally, as its proxy, with full power of substitution, in
the name, place and stead of the Purchaser, to vote all Excess Voting Securities
at any such meeting (and at any adjournment or adjournments thereof) or with
respect to any such written consent in the manner described in the preceding
sentence. Purchaser agrees that this proxy is coupled with an interest and shall
be irrevocable.
6. Filing of Form 8-K. By 9:30 a.m., New York time, on the first business day
following the Closing Date, the Company shall issue a press release and file a
Current Report on Form 8-K with the Commission, each describing the material
terms of the transactions contemplated hereby.
7. Notices. All communications hereunder will be in writing and, if sent to
any Purchaser, shall be mailed or delivered to it c/o Franklin Xxxxxxxxx
Investments, Xxx Xxxxxxxx Xxxxxxx, Xxx Xxxxx, XX 00000, Attention: [ ]
or, if sent to the Company, shall be mailed or delivered to it at 000 Xxxxx
Xxxxxxxx Xxxxxx, Xxxxx, Xxxxxxx 00000, Attention: Corporate Secretary.
8. Entire Agreement; Amendments. This Agreement contains the entire
understanding of the parties with respect to the subject matter hereof and
supersedes all prior agreements and understandings, oral or written, with
respect to such matters, which the parties acknowledge have been merged into
this Agreement. This Agreement may not be modified or amended except pursuant to
an instrument in writing signed by the Company and each Purchaser.
9. Successors. This Agreement will inure to the benefit of and be binding upon
the parties hereto and their respective successors and assigns, and no other
person will have any right or obligation hereunder. No purchaser of Shares from
a Purchaser shall be deemed to be a successor by reason merely of such purchase.
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10. Counterparts. This Agreement may be executed in any number of counterparts,
each of which shall be deemed to be an original, but all such counterparts shall
together constitute one and the same agreement.
11. Applicable Law. This Agreement shall be governed by, and construed in
accordance with, the laws of the State of Florida, without regard to its
principles of conflicts of laws.
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IN WITNESS WHEREOF, the parties have caused this Stock Purchase Agreement
to be executed by their respective representatives, hereunto duly authorized, as
of the date first written above.
TECO ENERGY, INC.
By: /s/ X.X. Xxxxx
---------------------------------
Name: X.X. Xxxxx
Title: Executive Vice President and
Chief Operating Officer
PURCHASERS: NUMBER OF SHARES PURCHASED:
FRANKLIN CUSTODIAN FUNDS - INCOME FUND, 9,800,000
a Maryland corporation
By: /s/ Xxxxxx Xxxxx
-----------------------------------
Name: Xxxxxx Xxxxx
Title: Vice President, Franklin Advisers
FRANKLIN CUSTODIAN FUNDS - UTILITIES FUND, 1,000,000
a Maryland corporation
By: /s/ Xxxx X. Xxxxx
-----------------------------------
Name: Xxxx X. Xxxxx
Title: Vice President, Franklin Advisers
FRANKLIN CUSTODIAN FUNDS - INCOME SECURITIES FUND, 200,000
a Massachusetts Business Trust
By: /s/ Xxxxxx Xxxxx
----------------------------------
Name: Xxxxxx Xxxxx
Title: Vice President, Franklin Advisers
EXHIBIT A
Matters to be Addressed in Opinion of Xxxxxx & Dodge LLP
1. The Company is a validly existing corporation in good standing under the
laws of the State of Florida, with corporate power and authority to own,
lease and operate its properties and conduct its business as described in
the Prospectus, and to enter into and perform its obligations under the
Agreement.
2. The Agreement has been duly authorized, executed and delivered by the
Company. The Shares have been duly authorized and, when issued and
delivered in accordance with the Agreement, will be validly issued, fully
paid and nonassessable.
3. No consent, approval, authorization or order of, or filing, registration or
qualification with, any governmental agency or body or any court is
required for the issuance or sale of the Shares by the Company, except such
as have been obtained and made under the Act, or as may be required under
state securities laws as to which no opinion is expressed.
4. The execution, delivery and performance of the Agreement by the Company
(including the issuance and sale of the Shares) will not result in a breach
or violation by the Company of any of the terms and provisions of, or
constitute a default under, any statute, any rule or regulation, or any
order known to such counsel, of any governmental agency or body or any
court having jurisdiction over the Company or any of its properties, or any
agreement or instrument that is listed as an exhibit to the Company's
Annual Report on Form 10-K for the year ended December 31, 2002 or the
Company's Quarterly Reports on Form 10-Q and Current Reports on Form 8-K
filed thereafter, or the charter or by-laws of the Company.
5. The Registration Statement has become effective under the Act.
6. The Registration Statement and the Prospectus, excluding the documents
incorporated by reference therein, and any amendment or supplement thereto,
as of their respective effective or issue dates, complied as to form in all
material respects with the requirements of the Act and the Rules and
Regulations; it being understood that such counsel need express no opinion
as to the financial statements, including the notes thereto, schedules or
other financial data contained or incorporated by reference therein or
excluded therefrom.
7. The Company is not and, after giving effect to the offering and sale of the
Shares and the application of the proceeds thereof as described in the
Prospectus, will not be an "investment company" as defined in the
Investment Company Act of 1940.
