Exhibit 10.3
TECO ENERGY, INC.
1996 EQUITY INCENTIVE PLAN
Amended Performance Shares Agreement
for
TECO Power Services Corporation Officers
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TECO Energy, Inc. (the "Company") and "Optionee" (the "Grantee") have
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entered into a Performance Shares Agreement (the "Original Agreement") dated
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June 1, 2000 under the Company's 1996 Equity Incentive Plan (the "Plan"). This
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agreement ("Agreement") dated October 18, 2000 amends and restates the Original
Agreement in its entirety. Capitalized terms not otherwise defined herein have
the meanings given to them in the Plan.
1. Grant of Performance Shares. Pursuant to the Plan and subject to the
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terms and conditions set forth in this Agreement, the Company hereby grants,
issues and delivers to the Grantee ((Share)) shares ("Number of Restricted
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Performance Shares") of its Common Stock (the "Restricted Performance Shares")
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as of the date of the Original Agreement and will grant, issue and deliver to
the Grantee the Performance Reward Percentage of "Shares" shares ("Number of
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Additional Performance Shares") of its Common Stock (the "Additional Performance
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Shares") no later than 30 days after the end of the Performance Period.
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The "Performance Period" is the period beginning April 1, 2000 and ending
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on the date determined under Section 3.
The "Net Income Performance Measurement" measures TECO Power Services
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Corporation's actual 3-year cumulative net income during the Performance Period
as a percentage of the cumulative target net income. Cumulative target net
income is set forth on Exhibit A to this Agreement.
The "XXX Performance Measurement" is TECO Power Services Corporation's
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actual return on equity (XXX) on operating plants in service during the
Performance Period.
The "Performance Reward Percentage" is the weighted average of the
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percentages shown in column B for Restricted Performance Shares and in column C
for Additional Performance Shares corresponding to the Performance Measurement
in column A, with interpolation of the percentages in columns B and C in
proportion to the corresponding placement in column A. The weighted average is
determined by placing 2/3 weight on the results from the Net Income Performance
Measurement and 1/3 weight on the results from the XXX Performance Measurement.
A B C
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Net Income Performance Reward Performance Reward
Performance Percentage for Percentage for
Measurement 2/3 of the Restricted 2/3 of the Additional
Performance Shares Performance Shares
Less than 70% 0% 0%
71%-80% 50% 0%
81%-90% 70% 0%
91%-100% 90% 0%
101%-110% 100% 10%
111%-120% 100% 30%
121%-130% 100% 50%
131%-140% 100% 70%
141% and above 100% 100%
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A B C
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XXX Performance Reward Performance Reward
Performance Percentage for Percentage for
Measurement 1/3 of the Restricted 1/3 of the Additional
Performance Shares Performance Shares
Less than 7.75% 0% 0%
7.75% 50% 0%
8.50% 70% 0%
9.25% 90% 0%
10.00% 100% 10%
11.25% 100% 30%
12.50% 100% 50%
13.75% 100% 70%
15.00% 100% 100%
2. Restrictions on Restricted Performance Shares. Until the restrictions
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terminate under Section 3, unless otherwise determined by the Committee:
(a) the Restricted Performance Shares may not be sold, assigned,
pledged or transferred by the Grantee; and
(b) all Restricted Performance Shares will be forfeited and returned
to the Company and the Grantee will cease to have any right to receive any
additional Performance Shares, if the Grantee ceases to be an employee of the
Company or any business entity in which the Company owns directly or indirectly
50% or more of the total voting power or has a significant financial interest as
determined by the Committee (an "Affiliate").
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3. End of Performance Period and Termination of Restrictions. The
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Performance Period will end, the restrictions on the Performance Reward
Percentage of the Number of
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Restricted Performance Shares will terminate, the remainder of the Restricted
Performance Shares will be forfeited and returned to the Company, and the
Grantee will cease to have any right to receive any Additional Performance
Shares in excess of the Performance Reward Percentage of the Number of
Additional Performance Shares, on the earliest to occur of the following events:
(a) the Grantee's death;
(b) the termination of Xxxxxxx's employment with the Company or any
Affiliate because of a disability that would entitle the Grantee to benefits
under the long-term disability benefits program of the Company for which the
Grantee is eligible, as determined by the Committee;
(c) the termination by the Company or any Affiliate of Xxxxxxx's
employment other than for Cause as determined by the Committee. "Cause" means
(i) willful and continued failure of the Grantee to substantially perform his
duties with the Company or such Affiliate (other than by reason of physical or
mental illness) after written demand specifically identifying such failure is
given to the Grantee by the Company, or (ii) willful conduct by the Grantee that
is demonstrably and materially injurious to the Company. For purposes of this
subsection, "willful" conduct requires an act, or failure to act, that is not in
good faith and that is without reasonable belief that the action or omission was
in the best interest of the Company or the Affiliate;
(d) the Grantee's retirement from the Company or an Affiliate at or
after attainment of the age at which benefits are payable under the TECO Energy
Group Retirement Plan or any successor thereto without reduction for
commencement of benefits before normal retirement age, or any earlier date that
the Committee determines will constitute a normal retirement for purposes of
this Agreement;
(e) upon a Change in Control. For purposes of this Agreement, a
"Change in Control" means a change in control of the Company of a nature that
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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:
(1) 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 shareholders 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;
(2) during any period of twenty-four (24) consecutive months
(not including any period prior to the date of this Agreement), individuals
who at the beginning of such period constitute the Board of Directors of
the Company and any new director (other than a director designated by a
person who has entered into an agreement with the Company to effect a
transaction described in subsections (1), (3) or (4) of this
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Section 3(e)) whose election by the Board of Directors of the Company or
nomination for election by the shareholders 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 at the beginning of such period or whose election
or nomination for election was previously so approved, cease for any reason
to constitute a majority thereof;
(3) 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 65% 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
(4) the shareholders 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; or
Notwithstanding the language in this Section 3, if a Change in Control as
defined in this subsection (e) occurs, the Performance Reward Percentage for
Restricted Performance Shares shall be 100%.
(f) March 31, 2003.
4. Rights as Shareholder. Subject to the restrictions and other
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limitations and conditions provided in this Agreement, the Grantee as owner of
the Restricted Performance Shares will have all the rights of a shareholder,
including but not limited to the right to receive all dividends paid on, and the
right to vote, the Restricted Performance Shares.
5. Stock Certificates. Each certificate issued for shares of Restricted
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Performance Shares will be registered in the name of the Grantee and deposited
by the Grantee with the Company and will bear a legend in substantially the
following form:
THE TRANSFERABILITY OF THIS CERTIFICATE AND THE SHARES OF STOCK
REPRESENTED HEREBY ARE SUBJECT TO THE TERMS, CONDITIONS AND
RESTRICTIONS (INCLUDING RESTRICTIONS ON TRANSFER AND FORFEITURE
PROVISIONS) CONTAINED IN AN AGREEMENT BETWEEN THE REGISTERED OWNER AND
TECO ENERGY, INC. A COPY OF SUCH AGREEMENT WILL BE FURNISHED TO THE
HOLDER OF THIS CERTIFICATE UPON WRITTEN REQUEST AND WITHOUT CHARGE.
Upon the termination of the restrictions imposed under this Agreement as to
any shares of Restricted Performance Shares deposited with the Company hereunder
under conditions that do not result in the forfeiture of those shares, the
Company will return to the Grantee (or to such Xxxxxxx's legal representative,
beneficiary or heir) certificates, without such legend, for such shares.
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6. Adjustment of Terms. In the event of corporate transactions affecting
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the Company's outstanding Common Stock, the Committee will equitably adjust the
number and kind of Additional Performance Shares subject to this Agreement to
the extent provided by the Plan.
7. Notice of Election Under Section 83(b). If the Grantee makes an
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election under Section 83(b) of the Internal Revenue Code of 1986, as amended,
with respect to Restricted Performance Shares, he or she will provide a copy
thereof to the Company within 30 days of the filing of such election with the
Internal Revenue Service.
8. Withholding Taxes. The Grantee will pay to the Company, or make
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provision satisfactory to the Committee for payment of, any taxes required by
law to be withheld in respect of the Restricted Performance Shares and
Additional Performance Shares no later than the date of the event creating the
tax liability. In the Committee's discretion, such tax obligations may be paid
in whole or in part in shares of Common Stock, including the Restricted
Performance Shares and the Additional Performance Shares, valued at fair market
value on the date of delivery. The Company and its Affiliates may, to the
extent permitted by law, deduct any such tax obligations from any payment of any
kind otherwise due to the Grantee.
9. The Committee. Any determination by the Committee under, or
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interpretation of the terms of, this Agreement or the Plan will be final and
binding on the Grantee.
10. Limitation of Rights. The Grantee will have no right to continued
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employment by virtue of this Agreement.
11. Amendment. The Company may amend, modify or terminate this Agreement,
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including substituting another Award of the same or a different type and
changing the date of realization, provided that the Grantee's consent to such
action will be required unless the action, taking into account any related
action, would not adversely affect the Grantee.
12. Governing Law. This Agreement will be governed by and interpreted in
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accordance with the laws of Florida.
By signing this Agreement, the Grantee, pursuant to Section 11 of the
Original Agreement, consents to this amendment of the Original Agreement.
TECO ENERGY, INC.
By: ___________________________
X. X. Xxxxxxxx
Secretary
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"Optionee"
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