EXHIBIT 10.(b)
Employment Agreement dated June 1, 1995
between Florida Progress and Xxxxxxx Xxxxxx
EMPLOYMENT AGREEMENT
THIS EMPLOYMENT AGREEMENT is made and entered as of the 1st day of June,
1995, by and between Florida Progress Corporation (the "Company") and Xxxxxxx
Xxxxxx (the "Employee").
W I T N E S S E T H:
WHEREAS, the Employee is currently serving as the President and Chief
Operating Officer of the Company; and
WHEREAS, it is the desire of both parties that the arrangements and
understandings of the parties concerning the continued employment of the
Employee be set forth in writing.
NOW, THEREFORE, in consideration of the premises and the mutual covenants
and agreements contained in this Agreement, and other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged, the
parties hereby agree as follows:
1. Employment. The Company hereby agrees to continue the employment of
the Employee, and the Employee hereby accepts such continued employment, upon
the terms and subject to the conditions set forth in this Agreement.
2. Term. The term of employment under this Agreement (the "Term of
Employment") shall begin as of June 1, 1995, and, subject to the provisions of
termination as hereinafter provided in Sections 6 and 7, shall terminate on
March 1, 1998; provided, however, that beginning on March 1, 1996 and on each
March 1 (the "Renewal Date") thereafter, the Term of Employment shall
automatically be extended for one additional year unless either party gives the
other written notice of termination at least ninety (90) days prior to any such
Renewal Date.
3. Duties.
(a) The Employee has been engaged as the President and Chief
Operating Officer of the Company. In addition, the Employee shall have such
other duties and hold such offices as may from time to time be reasonably
assigned to him by the Board of Directors of the Company with respect to the
business and affairs of the Company.
(b) The Employee agrees to act within the scope of authority
delegated to him from time to time pursuant to this Agreement and, so far as
reasonably practicable, to observe and abide by every limitation placed upon
such authority from time to time. No latitude, indulgence or forbearance granted
by the Company to the Employee shall be deemed a relinquishment of its right to
direct or control him or a waiver of its right to require performance and
fulfillment of the duties and responsibilities of his employment hereunder or of
any other provision hereof.
4. Extent of Services. During his Term of Employment, the Employee
shall devote his full time, energy and attention to, and actively participate
in, the management of the business and affairs of the Company and shall not
become employed, engaged or involved, in any capacity, in any commercial or
professional endeavor, business or business activity other than the business and
affairs of the Company, provided, however, that the foregoing shall not prevent
Employee from serving as a director or trustee of other corporations or
organizations if such service has been approved by the Company's Board of
Directors.
5. Compensation. The Company shall pay the Employee, and the Employee
agrees to accept from the Company, as compensation in full for the Employee's
services under this Agreement and the faithful performance and observance of all
of the Employee's obligations to the Company hereunder, the following:
(a) Base Salary. Throughout the Term of Employment, the Employee
shall be paid a base salary at the rate of Four Hundred and Forty Thousand
Dollars ($440,000) per
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year, or such greater amount as may from time to time be determined by the
Board of Directors of the Company, payable in accordance with the Company's
standard pay practices.
(b) Incentive Plans. In addition to the base salary provided for in
paragraph 5(a), Employee shall be entitled to participate in Florida Progress'
MICP, and Florida Progress' LTIP, or any other incentive compensation plans that
may be established by the Board of Directors; participation in the MICP and LTIP
shall be at a percentage target level not less than the level authorized for
1995.
(c) SERP. Employee will be entitled to continue to participate in
the Company's Supplemental Executive Retirement Plan (SERP), or any successor
plan thereto at not less than his current benefits together with any
improvements thereto.
(d) Employee Benefits. Employee shall be entitled to continue to
participate in the Company's Retirement Plan, Savings Plan, Executive Optional
Deferred Compensation Plan and all other benefit plans that are available to
employees of the Company.
6. Termination by the Company. The Company, acting by a vote of its Board
of Directors, may terminate Employee's employment hereunder (and consequently
his Term of Employment) under the following circumstances:
(a) Termination for Cause.
(i) The willful, substantial, continued, and unjustified refusal
of Employee to perform the duties required of him by this Agreement to
the extent of his ability to do so.
(ii) The willful engaging by Employee in conduct which is
demonstrably and materially injurious to the Company, financially or
otherwise. For purpose
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of this paragraph, no act, or failure to act, on Employee's part shall
be deemed "willful" unless done, or omitted to be done, by Employee
not in good faith and without reasonable belief that Employee's action
or omission was in the best interest of the Company.
(iii) Notwithstanding the foregoing, Employee shall not be deemed
to have been terminated for cause unless and until there shall have been
delivered to Employee a copy of a resolution duly adopted by the
affirmative vote of not less than a majority of the entire membership of
the Board of Directors at a meeting of the Board (after reasonable
notice to Employee and an opportunity for Employee, together with
Employee's counsel, to be heard before the Board), finding that, in the
good faith opinion of the Board, Employee was guilty of engaging in such
conduct.
(b) Termination due to Disability. The Employee shall be unable to
perform his duties hereunder by reason of disability that shall have continued
for a period of at least one hundred and eighty (180) consecutive days.
Moreover, during any such 180-day period the Employee shall receive the base
salary and bonus pursuant to this Agreement as if he were not disabled. The word
"disability" as used in this Agreement shall mean the inability of the Employee,
as determined by the Board of Directors of the Company, by reason of physical or
mental disability to perform the duties required of him under this Agreement.
(c) Termination Without Cause. The Company, acting by majority vote of
its Board of Directors, will have the right to terminate the Term of Employment
without cause upon thirty (30) days' written notice to Employee.
Upon termination of Employee's employment under paragraph 6(c) or
by the Employee for Good Reason as defined in paragraph 8(d), the Employee shall
be entitled only to provisions of Section 8 and the Company shall have no other
obligation to the Employee. In the event termination of the Employee's
employment under the provisions of paragraph 6(a) or
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6(b) or if the Employee terminates his employment under this Agreement for any
reason other than "Good Reason" as defined in paragraph 8(d), all rights of the
Employee under this Agreement shall terminate upon the effective date of the
termination of employment, the Employee shall have no further rights to be
employed or to receive any further benefit under this Agreement, and the
Company shall thereafter have no obligations to the Employee under this
Agreement, except for rights of the Employee vested and accrued prior thereto.
7. Death of Employee. If the Employee dies during the Term of Employment, all
rights of the Employee under this Agreement shall terminate upon his death
(other than rights vested and accrued prior thereto). The Company shall pay to
the estate of the Employee the compensation that otherwise would be payable to
the Employee through the end of the calendar month in which his death occurs,
and the Company shall have no additional obligation under this agreement to the
Employee or his estate.
8. Severance Pay.
(a) If Employee's employment is terminated by the Company without cause
under the provisions of paragraph (c) of Section 6, or if Employee's employment
is terminated by the Employee for Good Reason, as defined in paragraph 8(d) of
this Agreement:
(i) the Employee shall be entitled to receive and the Company
shall be obligated to pay to the Employee, an amount equal to three
times the sum of his annual base pay and the MICP target amount in
effect as of the date of termination.
(ii) In addition, if the Company's LTIP and SERP are in effect on
the date of termination, the Employee shall be entitled to receive:
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- all shares of the Company's common stock that have been
awarded under the Company's LTIP, which shall immediately
vest and have all restrictions removed; and
- the "Actuarial Equivalent" as defined in the SERP, of any
vested Accrued Benefit provided in the SERP. In the event
the Employee is terminated prior to March 1, 1997, the
Employee shall be deemed to have satisfied the vesting
requirements contained in the SERP.
(b) The Company shall pay the Employee the amount due under paragraph
8(a) in 36 equal monthly installments. The first installment shall be due and
payable on the first day of the month following the date of termination, with
subsequent payments being due and payable on the first day of each following
month.
(c) Any amount payable under this Section 8 is in lieu of, and not in
addition to, any further compensation payments for the then remaining Term of
Employment. Such amount shall be paid to the Employee regardless of whether the
Employee finds, seeks or receives an offer for alternative employment or
receives compensation from other sources. The Employee shall be under no duty to
mitigate damages or losses that he might incur by reason of such termination of
his employment by the Company.
(d) For purposes of this Agreement, "Good Reason" shall mean, without
the Employee's express written consent, the occurrence of any one or more of the
following:
(i) a change in the duties and responsibilities of the Employee's
position such that a substantial reduction occurs from the duties and
responsibilities in effect either as of the date of this Agreement or
immediately prior to the change in responsibilities.
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(ii) a reduction by the Company of the Employee's base salary as in
effect on the date hereof, as increased from time to time, except a
reduction consistent with salary reductions of all personnel on the
executive payroll.
(iii) The Company requiring the Employee to be based in a city
other than the city where the Employee is based on the date hereof.
9. Restrictive Covenants.
(a) During the Term of Employment, and for a period of two (2) years
after the expiration of the Term of Employment or other termination of the
Employee's employment hereunder, whether by the Employee, the Company or
otherwise, for whatever reason or no reason at all, the Employee shall maintain
the confidentiality of all confidential and proprietary information relating to
the business of the Company and its subsidiaries that he has previously acquired
as an employee of the Company or that he may acquire in the course of his
engagement hereunder, and shall not utilize such confidential and proprietary
information to the detriment of the Company or any of its subsidiaries, or
otherwise knowingly disclose any such confidential information to any third
person. Following expiration of the Term of Employment or other termination of
the Employee's employment hereunder, whether by the Employee, the Company or
otherwise, for whatever reason or no reason at all, the Employee shall promptly
return to the Company all written materials containing confidential and
proprietary information regarding the Company or any of its subsidiaries that
the Employee has previously acquired as an employee of the Company or that he
obtained in the course of the performance of his duties hereunder.
(b) During the Term of Employment, and for a period of two (2) years
after the expiration of the Term of Employment or other termination of the
Employee's employment hereunder, whether by the Employee, the Company or
otherwise, for whatever reason or no reason at all, the Employee:
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(i) shall not induce or attempt to induce any employee of
the Company to leave the employ of the Company or any of its subsidiaries;
and
(ii) shall not, directly or indirectly, own, operate, manage, have
a proprietary interest of any kind in, extend financial assistance to,
solicit, encourage or handle patronage for, be employed by or serve as a
consultant, or in any other capacity, for the principal or branch office or
facilities of any person engaged primarily in business the same as,
substantially similar to or in substantial direct competition with the
business of the Company or any of its subsidiaries and located within the
States of Florida, Georgia, Alabama, North Carolina and South Carolina,
except that the Employee may own stock in such a corporation so long as
such stock is publicly traded, the Employee does not own more than five
percent (5%) of the outstanding stock of said corporation and the ownership
of such stock does not in any way represent any form of compensation for
any services rendered by the Employee to said corporation.
(c) It is understood by and between the parties hereto that the
covenants set forth in this Section 9 are essential elements of this Agreement,
and that, but for the agreement of the Employee to comply with such covenants,
the Company would not have agreed to enter into this Agreement. Such covenants
by the Employee shall be construed as agreements independent of any other
provision in this Agreement. The existence of any claim or cause of action of
the Employee against the Company, whether predicated on this Agreement or
otherwise, shall not constitute a defense to the enforcement by the Company of
such covenants, or any of them.
(d) The Employee agrees that damages at law will be an insufficient
remedy to the Company if the Employee violates the terms of this Section 9 and
that the Company would suffer irreparable damage as a result of any such
violation. Accordingly, it is agreed that the Company shall be entitled, upon
application to a court of competent jurisdiction, to obtain injunctive relief to
enforce the provisions of this Section 9, which injunctive relief shall be in
addition to any other rights or remedies available to the Company.
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(e) The Employee agrees to pay to the Company all costs and expenses
incurred by the Company relating to the enforcement of the terms of this Section
9, including reasonable fees and disbursements of counsel and legal assistants
(whether incurred before trial, at trial, in appellate proceedings, or
otherwise).
(f) The restrictions of this Section 9 shall extend to all activities of
Employee, whether as a sole proprietor, an independent contractor, partner or
joint venturer, or as an officer, director, stockholder (except as otherwise
specified in paragraph (b) (ii) above), agent, employee or salesman for any
individual, firm, partnership, corporation or other entity, or otherwise.
(g) The period of time during which the Employee is prohibited from
engaging in certain business practices pursuant to the provisions of paragraphs
(a) or (b) of this Section 9 shall be extended by any length of time during
which the Employee is in breach of such covenants.
(h) It is agreed by the Company and the Employee that if any portion of
the covenants set forth in this Section 9 are held to be invalid, unreasonable,
arbitrary or against public policy, then such portion of such covenants shall be
considered divisible both as to time and geographical area. The Company and the
Employee agree that, if any court of competent jurisdiction determines the
specified time period or the specified geographical area applicable to this
Section 9 to be invalid, unreasonable, arbitrary or against public policy, a
lesser time period or geographical area that is determined to be reasonable,
non-arbitrary and not against public policy may be enforced against the
Employee. The Company and the Employee agree that the foregoing covenants are
appropriate and reasonable when considered in light of the nature and position
held by the Employee and the extent of the business conducted by the Company.
10. Xxxxxxx Xxxxxxx Restrictions. The Employee acknowledges and is aware that
applicable state and federal securities laws prohibit any person who has
material non-public
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information about a company from purchasing or selling the securities of that
company. The Employee further acknowledges that during the course of his
employment by the Company he may become privy to material non-public
information regarding the Company or other companies. The Employee agrees
and acknowledges that such material non-public information will be the
property of the Company and such other companies. The Employee covenants and
agrees not to disclose, and will not suffer or permit any of the employees or
agents of the Company under his supervision to disclose, to any third person or
make use of any material non-public information about the Company or any other
company in connection with the purchase or sale of any securities, including
securities of the Company and its subsidiaries. The foregoing covenants
regarding material non-public information shall not apply to the extent that
such information is publicly disclosed by the Company or otherwise publicly
disclosed in accordance with law by a person other than the Employee.
11. Compliance with Other Agreements. The Employee represents and warrants
that the execution of this Agreement by him and his performance of his
obligations hereunder will not conflict with, result in the breach of any
provision of or the termination of or constitute a default under any Agreement
to which the Employee is a party or by which the Employee is or may be bound.
12. Disputes. Should a Change in Control, as defined in Section 2.1(e) of the
SERP, occur, Employee shall be entitled to recover all reasonable costs and
expenses (including fees and disbursements of counsel and legal assistants,
whether incurred before trial, at trial, in appellate proceedings, or otherwise)
incurred with respect to any action relating to this Agreement, whether brought
by Employee, or by or on behalf of the Company or any successor or affiliate; in
all other cases, the prevailing party in any action relating to this Agreement
shall be entitled to recover all such costs and expenses.
13. Waiver of Breach. The waiver of the Company of a breach by the
Employee of any provision of this Agreement shall not operate or be construed as
a waiver of any
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subsequent breach by the Employee. No waiver shall be valid unless in writing
and approved by the Board of Directors of the Company.
14. Notice. All notices, requests, demands and other communications that are
required or that may be given under this Agreement shall be in writing and shall
be deemed to have been duly given when received, if personally delivered; when
transmitted, if transmitted by electronic fax, telecopy or similar electronic
transmission method (provided customary evidence of receipt is obtained); the
day after it is sent, if sent by recognized overnight delivery service; and
three days after it is sent, if mailed, first class certified mail, return
receipt requested, postage prepaid. In each case notice shall be sent to the
parties at the following addresses:
To the Company at: Florida Progress Corporation
P. O. Xxx 00000
Xx. Xxxxxxxxxx, XX 00000
Attn: Corporate Secretary
To the Employee at: Xx. Xxxxxxx Xxxxxx
0000 Xxxxxx Xxxxx Xxxxx
Xxxxxxx, XX 00000
Personal delivery to the Company shall be only to an executive officer thereof
other than the Employee. Either party may change his or its address to which
notice is to be sent pursuant hereto by sending a notice of such change in
conformity with the foregoing requirements to the other party.
15. Binding Effect; Assignment. The rights and obligations of the Company
under this Agreement shall inure to the benefit of and shall be binding upon the
successors and assigns of the Company. This Agreement is a personal employment
contract, and the Employee acknowledges that the services to be rendered by him
are unique and personal. Accordingly, the Employee may not assign or otherwise
transfer any of his rights or delegate any of his duties or obligations under
this Agreement.
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16. Entire Agreement. The parties hereto agree that this Agreement constitutes
the entire agreement between the parties hereto pertaining to the employment of
the Employee, that this Agreement supersedes all prior and contemporaneous
agreements and understandings of the parties, and that there are no warranties,
representations or other agreements between the parties in connection with the
subject matter hereof except as specifically set forth in this Agreement.
17. Separability and Modification. In the event any provision of this
Agreement is invalid or unenforceable under the laws of the State of Florida,
such provision shall be deemed to be restricted in scope or otherwise modified
to the extent necessary to render the same valid and enforceable, or shall be
deemed excised from this Agreement if circumstances so require, and this
Agreement shall be constructed and enforced herein as so restricted or modified,
or as if such provision had not originally been contained herein, as the case
may be.
18. Amendment. The parties hereto may amend or modify this Agreement in
such manner as may be agreed upon only by a written instrument executed by such
parties.
19. Definition of "Person." For all purposes of this Agreement, the word
"person" shall refer not only to a natural person but also to any corporation,
partnership, joint venture, trust or other entity or business arrangement.
20. Governing Law. This Agreement shall be construed and enforced in
accordance with the laws of the State of Florida.
21. Headings. The headings of the various sections in this Agreement are
inserted for the convenience of the parties and shall not affect the meaning,
construction or interpretation of this Agreement. They are not intended to
modify or explain or to be a full or accurate description of the contents
hereof.
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IN WITNESS WHEREOF, the parties hereto have executed this Agreement the day
and year first above written.
/s/ Xxxxxxxx X. Xxxxx /s/ Xxxxxxx Xxxxxx
----------------------------- -------------------------------
Witness Xxxxxxx Xxxxxx
/s/ Xxxxx X. Xxxxxxx
-----------------------------
Witness FLORIDA PROGRESS CORPORATION
By:/s/ Xxxx X. Xxxxxxxxxxx
/s/ Xxxxx X. Xxxxx -------------------------------
-----------------------------
Witness
/s/ Xxxxx X. Xxxxxxx
-----------------------------
Witness
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XX. XXXXXXX XXXXXX
ESTIMATED
VESTED ACCRUED BENEFIT
MARCH 1, 1997
ASSUMPTIONS:
Service at termination: 7 Years 9 Months
Service at normal retirement: 17 Years 9 Months
Final Average Earnings
Base salary: 3/7/1994 $440,000
Average of highest 3 consecutive years out of last 5 years $440,000
MICP paid in:
1993- Actual $45,000
1994 - Actual $265,000*
1995 - Actual $232,500*
1996 - Est. $198,000*
1997 - Est. $198,000
*One of highest 3 years out of last 5 years MICP
Average of highest 3 MICP awards $231,833
Final Average Earnings at death $671,833
Estimated annual Social Security - $14,520
OLD FORMULA
(35 yrs x 1.8%) X $671,833 $423,255
(35 yrs x 1.14286%) X $14,520 ($5,808)
--------
Subtotal $417,447
Career service reduction (7.75/17.75) 0.43662
--------
Total Estimated Accrued Benefit $182,266 *
Early payment factor at age 55 0.6500
Total Benefit payable at 3/1/97 $118,473
*Paid by Retirement Plan, Non-Discrimination Plan and SERP.
XX. XXXXXXX XXXXXX
ESTIMATED SEVERANCE BENEFIT
MARCH 1, 1997
PART 8(a)(i)
Current Earnings
Annual Base Salary $440,000
Target MICP (45%) $198,000
Total Earnings $638,000
Total Earnings x 3 $1,914,000
PART 8(a)(iii)
A. Estimated annual vested benefit
As of March 1, 1997 $118,473
Actuarial Equivalent Factor* 14.479
Total Present Value Accrued Benefit $1,715,371
Grand Total $3,629,371
*Actual factor at event date would be determined using the PBGC rate and
actual age in effect on that date
