SCHEDULE 14A INFORMATION
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TECO ENERGY, INC.
March 3, 1997
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD ON APRIL 16, 1997
The Annual Meeting of the Shareholders of TECO Energy, Inc. will be held
at the principal office of the Corporation, TECO Plaza, 702 North Franklin
Street, Tampa, Florida, on Wednesday, April 16, 1997 at 11:30 a.m., for the
following purposes:
1. To elect five directors.
2. To approve the 1997 Director Equity Plan.
3. To consider and act on such other matters as may properly come
before the meeting.
Shareholders of record at the close of business on February 14, 1997
will be entitled to vote at the meeting and at any adjournments thereof.
Even if you plan to attend the meeting, you are requested to mark, sign
and date the enclosed proxy and to return it promptly in the accompanying
envelope. If you attend the meeting and wish to vote in person, your proxy
will not be used.
By order of the Board of
Directors,
R. H. Kessel, Secretary
TECO ENERGY, INC.
P.O. Box 111 Tampa, Florida 33601 (813) 228-4111
TECO ENERGY, INC.
P.O. Box 111, Tampa, Florida 33601
PROXY STATEMENT
The enclosed proxy is solicited on behalf of the Board of Directors of
TECO Energy, Inc. (the Corporation ) to be voted at the Annual Meeting of
Shareholders of the Corporation to be held at the time and place and for
the purposes set forth in the foregoing notice. This proxy statement and
the enclosed proxy are being mailed to shareholders beginning on or about
March 3, 1997.
VOTING OF SECURITIES
As of February 14, 1997, the record date for the determination of
shareholders entitled to vote at the meeting, the Corporation had
outstanding 117,601,707 shares of Common Stock, $1 par value ( Common
Stock ), the only class of stock of the Corporation outstanding and
entitled to vote at the meeting. The holders of Common Stock are entitled
to one vote for each share registered in their names on the record date
with respect to all matters to be acted upon at the meeting.
The presence at the meeting, in person or by proxy, of a majority of the
s h a res outstanding on the record date will constitute a quorum.
Abstentions and broker non-votes will be considered as shares present for
purposes of determining the presence of a quorum.
A shareholder giving a proxy may revoke it at any time before it is
exercised at the meeting by filing with the Secretary of the Corporation a
written notice of revocation or a duly executed proxy bearing a later date
or by attending the meeting and voting in person.
Shares represented by valid proxies received will be voted in the manner
specified on the proxies. If no instructions are indicated on the proxy,
the proxy will be voted for the election of the five nominees for director
named below and for the approval of the 1997 Director Equity Plan.
The affirmative vote of a majority of the Common Stock of the
Corporation represented at the meeting in person or by proxy will be
required to elect directors and to approve the 1997 Director Equity Plan.
For each of these matters, (i) abstentions will be considered as
represented at the meeting and, therefore, will be the equivalent of a
negative vote and (ii) broker non-votes will not be considered as
represented at the meeting.
ELECTION OF DIRECTORS
The Corporation s Bylaws provide for the Board of Directors to be
divided into three classes, with each class to be as nearly equal in number
as possible. As the term of one class of directors expires, their
successors are elected for a term of three years at each annual meeting of
shareholders. Mrs. Baldwin and Messrs. Culbreath, Flom, Guild and Sovey
have been nominated for a term expiring in 2000, and each has consented to
serve if elected. If any nominee is unable to serve, the shares
represented by valid proxies will be voted for the election of such other
person as the Board may designate.
The following table contains certain information as to the nominees and
each person whose term of office as a director will continue after the
meeting. Information on the share ownership of each of these individuals
is included under Share Ownership below.
Principal Occupation During Present
Last Five Years and Director Term
Name Age Other Directorships Held(1) Since(1) Expires
Girard F. Anderson 64 President and Chief Operating 1994 1998
Officer, TECO Energy,
Inc.; formerly
Executive Vice
President-Utility
Operations, TECO
Energy, Inc. and
President and Chief
Operating Officer,
Tampa Electric Company
DuBose Ausley 59 Chairman, Ausley & McMullen 1992 1999
attorneys),Tallahassee,
Florida; formerly
Chairman, Macfarlane,
Ausley, Ferguson &
McMullen (attorneys),
Tallahassee, Florida
and President of a
predecessor firm; also
a director of Sprint
Corporation and Capital
City Bank Group Inc.
*Sara L. Baldwin 65 Private Investor; formerly 1980 1997
Vice President, Baldwin
and Sons, Inc.
(insurance
agency),Tampa, Florida
2
Principal Occupation During Present
Last Five Years and Director Term
Name Age Other Directorships Held(1) Since(1) Expires
*Hugh L. Culbreath 75 Retired; formerly Chairman 1971 1997
of the Board, TECO
Energy, Inc. and Tampa
Electric Company
James L. Ferman, Jr. 53 President, Ferman Motor Car 1985 1999
Company, Inc.
(automobile
dealerships), Tampa,
Florida; also a
director of The Bank
of Tampa and
itsholding company,
The Tampa Banking
Company
*Edward L. Flom 67 Retired; formerly Chairman 1980 1997
of the Board and Chief
Executive Officer,
Florida Steel
Corporation
(production and
fabrication of steel
products), Tampa,
Florida; also a
director of Outback
Steakhouse, Inc.
*Henry R. Guild, Jr. 68 President and Director, 1980 1997
Northeast Investment
Management, Inc.
(private trustees and
family investment
advisers), Boston,
Massachusetts
Timothy L. Guzzle 60 Chairman of the Board 1988 1998
and Chief Executive
Officer, TECO Energy,
Inc.; also a director
of NationsBank
Corporation
3
Principal Occupation During Present
Last Five Years and Director Term
Name Age Other Directorships Held(1) Since(1) Expires
Dennis R. Hendrix 57 Chairman of the Board 1995 1999
and formerly Chief
Executive Officer
and President,
PanEnergy Corp
(interstate gas
pipeline), Houston,
Texas; also a
director of Texas
Eastern Products
Pipeline Company,
general partner of
TEPPCO Partners,
LP, a publicly
traded limited
partnership
Robert L. Ryan 53 Senior Vice President and 1991 1999
Chief Financial
Officer, Medtronic,
Inc. (medical
devices
manufacturer),
Minneapolis,
Minnesota; formerly
Vice President-
Finance, Union
Texas Petroleum
Holdings, Inc.
(independent oil
and gas exploration
and production),
Houston, Texas;
also a director of
Inter-Regional
Financial Group,
Inc. and United
Healthcare
Corporation
*William P. Sovey 63 Vice Chairman and Chief 1996 1997
Executive Officer
and formerly
President and Chief
Operating Officer,
Newell Co.
(consumer
products),
Freeport, Illinois;
also a director of
Acme Metals, Inc.
4
Principal Occupation During Present
Last Five Years and Director Term
Name Age Other Directorships Held(1) Since(1) Expires
J. Thomas Touchton 58 Managing Partner, The Witt- 1987 1998
Touchton Company
(private investment
partnership),
Tampa, Florida;
also a director of
17 Merrill Lynch-
sponsored mutual
funds
John A. Urquhart 68 President, John A.Urquhart 1991 1998
Associates (management
consultants), Fairfield,
Connecticut and Vice Chairman and
a director of Enron
Corp.(diversified natural gas
company), Houston, Texas; formerly
Senior Vice President, G.E.
Industrial & Power Systems,
General Electric Company; also a
director of Hubbell Incorporated
and Aquarion Company
James O. Welch, Jr. 65 Retired; formerly Vice 1976 1999
Chairman, RJR Nabisco, Inc. and
Chairman, Nabisco Brands, Inc.;
also a director of Kmart
Corporation and Vanguard Group of
Investment Companies
_________
*Nominee for election as director
(1) All of the directors of the Corporation also serve as directors of
Tampa Electric Company, and the period of service shown includes
service on Tampa Electric Company's Board prior to the formation of
the Corporation on January 15, 1981. On April 15, 1981, the
Corporation became the corporate parent of Tampa Electric Company as
a result of a reorganization.
The Board of Directors held five meetings in 1996. All directors
attended at least 75% of the meetings of the Board and Committees on which
they served, except for Mr. Ryan who attended 71% of such meetings.
The Corporation has standing Audit and Compensation Committees of the
Board of Directors. It does not have a Nominating Committee. The
Compensation Committee, which met three times in 1996, is currently
composed of Mrs. Baldwin and Messrs. Guild, Sovey, Urquhart and Welch
(Chairman). The Audit Committee, which met twice in 1996, is currently
composed of Messrs. Ferman, Flom, Hendrix, Ryan and Touchton (Chairman).
For additional information about the Compensation Committee and the Audit
Committee, see "Executive Compensation Compensation Committee Report on
5
Executive Compensation and Information Concerning Auditors and Audit
Committee below.
During 1996, Mr. Ausley served as Chairman of Macfarlane, Ausley,
Ferguson & McMullen and of a successor to that firm, Ausley & McMullen.
The Corporation paid $386,223 and $647,333, respectively, to these firms
for legal services rendered during 1996.
Compensation of Directors
Directors who are not employees or former employees of the Corporation
or any of its subsidiaries are paid an annual retainer of $27,000 and
attendance fees of $750 for each meeting of the Board of the Corporation,
$750 for each meeting of the Board of Tampa Electric Company and $1,000 for
each meeting of a Committee of the Board on which they serve. Directors
may elect to defer these amounts with earnings credited at either the 90-
day U.S. Treasury bill rate or a rate equal to the total return on the
Corporation's Common Stock.
The Corporation has an agreement with Mr. Culbreath under which he will
provide consulting services to the Corporation through December 31, 2000
for compensation at a rate of $175,000 per year. Mr. Culbreath served as
Chief Executive Officer of the Corporation until April 1989 and retired as
an employee in April 1990 at which time the consulting relationship
commenced. The agreement provides a severance benefit (in the event of
termination of Mr. Culbreath s consultancy following a change in control of
the Corporation) equal to the total compensation that would have been
payable over the remaining term of the agreement. This benefit is payable
under the same circumstances as the benefits described under "Executive
Compensation Employment and Change in Control Arrangements" below and will
be reduced to the extent that such benefit, taking into account any other
compensation provided by the Corporation, would not be deductible by the
Corporation pursuant to Section 280G of the Internal Revenue Code.
1991 Director Stock Option Plan and 1997 Director Equity Plan. All non-
employee directors participate in the Corporation s 1991 Director Stock
Option Plan (the 1991 Plan ), which provides automatic annual grants of
options to purchase shares of Common Stock to such directors. The exercise
price is the fair market value of the Common Stock on the date of grant,
payable in whole or in part in cash or Common Stock. The plan provides for
an initial grant of options for 10,000 shares to each new director and an
annual grant of options for 2,000 shares to each continuing director.
Grants are made on the first trading day of the Common Stock after each
annual meeting of shareholders. The options are exercisable immediately
and expire ten years after grant or earlier as provided in the plan
following termination of service on the Board.
The Board has adopted, subject to shareholder approval, the 1997
Director Equity Plan (the Plan ) as an amendment and restatement of the
1991 Plan. See Approval of 1997 Director Equity Plan below.
Directors Retirement Plan. All directors who have completed 60 months
of service as a director and who are not employees or former employees of
the Corporation or any of its subsidiaries are eligible to participate in
the TECO Energy, Inc. Directors Retirement Plan (the Directors
Retirement Plan ). Under this plan, a retired director or his or her
surviving spouse will receive a monthly retirement benefit at the rate of
$20,000 per year. Such payments will continue for the lesser of the number
6
of months the director served as a director or 120 months, but payments
will in any event cease upon the death of the director or, if the
director s spouse survives the director, the death of the spouse.
The Board has terminated the Directors Retirement Plan for active
directors, subject to shareholder approval of the 1997 Director Equity
Plan. If such Plan is approved, active directors who participate in the
Directors Retirement Plan will receive a one-time payment, made 50% in
Common Stock and 50% in cash, of the present value of the income stream
they would have received under the plan based on their length of service as
of December 31, 1996. At the election of the director, the cash portion of
this payment could be deferred in the same manner as the retainer and
meeting fees or paid in Common Stock. The aggregate value of the cash and
Common Stock that would be payable in connection with the termination of
the Directors Retirement Plan is approximately $1.1 million. See
Approval of 1997 Director Equity Plan below.
SHARE OWNERSHIP
There is no person known to the Corporation to be the beneficial owner
of more than five percent of the outstanding Common Stock as of December
31, 1996.
The following table sets forth the shares of Common Stock beneficially
owned as of January 31, 1997 by the Corporation s directors and nominees,
its executive officers named in the summary compensation table below and
its directors and executive officers as a group. Except as otherwise
noted, such persons have sole investment and voting power over the shares.
The number of shares of the Corporation s Common Stock beneficially owned
by any director
or executive officer or by all directors and executive officers as a group
does not exceed 1% of such shares outstanding at January 31, 1997.
Name Shares(1) Name Shares(1)
Girard F. Anderson 157,304(2)(3) William P. Sovey 11,000
DuBose Ausley 23,727 J. Thomas Touchton 24,000(11)
Sara L. Baldwin 22,918(4) John A. Urquhart 23,499(12)
Hugh L. Culbreath 77,800(5) James O. Welch, Jr. 28,600(13)
James L. Ferman, Jr. 28,207(6) Keith S. Surgenor 98,025(2)(14)
Edward L. Flom 24,172(7) Roger H. Kessel 145,414(2)
Henry R. Guild, Jr. 123,579(8) Alan D. Oak 79,175(2)(15)
Timothy L. Guzzle 199,041(2)(9) All directors and
Dennis R. Hendrix 12,500 executive officers
Robert L. Ryan 22,000(10) as a group
(18 persons) 1,075,051(2)(16)
(1) The amounts listed include the following shares that are subject
to options granted under the Corporation s stock option plans:
Mr. Ausley, 18,000 shares; Mrs. Baldwin and Messrs. Culbreath,
Ferman, Flom, Guild, Ryan, Touchton and Welch, 20,000 shares
each; Messrs. Hendrix and Sovey, 10,000 shares each; Mr.
U r quhart, 17,200 shares; Mr. Guzzle, 140,000 shares; Mr.
Anderson, 112,000 shares; Mr. Surgenor, 77,000 shares; Mr.
Kessel, 137,000 shares; Mr. Oak, 43,000 shares; and all directors
and executive officers as a group, 739,200 shares.
7
(2) The amounts listed include the following shares that are held by
benefit plans of the Corporation for an officer's account: Mr.
Guzzle, 2,041 shares; Mr. Anderson, 8,684 shares; Mr. Surgenor,
2,717 shares; Mr. Kessel, 2,314 shares; Mr. Oak, 9,945 shares;
and all directors and executive officers as a group, 25,955
shares.
(3) Includes 800 shares owned by Mr. Anderson's wife, as to which
shares he disclaims any beneficial interest.
(4) Includes 350 shares held by a trust of which Mrs. Baldwin is a
trustee.
(5) Includes 8,000 shares owned by Mr. Culbreath's wife, as to which
shares he disclaims any beneficial interest.
(6) Includes 2,584 shares owned jointly by Mr. Ferman and his wife.
Also includes 903 shares owned by Mr. Ferman's wife, as to which
shares he disclaims any beneficial interest.
(7) Includes 1,596 shares owned by Mr. Flom's wife, as to which
shares he disclaims any beneficial interest. Also includes 1,388
shares owned by a Revocable Living Trust of which Mr. Flom is the
sole trustee.
(8) Includes 101,179 shares held by trusts of which Mr. Guild is a
trustee. Of these shares, 49,800 are held for the benefit of Mr.
Culbreath and are also included in the number of shares
beneficially owned by him.
(9) Includes 34,100 shares owned by a Revocable Living Trust of which
Mr. Guzzle is a trustee.
(10) Includes 2,000 shares owned jointly by Mr. Ryan and his wife.
(11) Includes 4,000 shares owned by a Revocable Living Trust of which Mr.
Touchton is the sole trustee.
(12) Includes 1,000 shares owned by Mr. Urquhart's wife, as to which shares
he disclaims any beneficial interest.
(13) Includes 2,000 shares owned by a charitable foundation of which Mr.
Welch is a trustee.
(14) Includes 9,403 shares owned jointly by Mr. Surgenor and his wife.
(15) Includes 20,130 shares owned by a Revocable Living Trust of which Mr.
Oak's wife is the sole trustee.
(16) Includes a total of 13,987 shares owned jointly with spouses. Also
includes a total of 12,299 shares owned by spouses, as to which shares
beneficial interest is disclaimed.
8
SHAREHOLDER RETURN PERFORMANCE GRAPH
The following graph shows the cumulative total shareholder return on the
Corporation s Common Stock on a yearly basis over the five-year period
ended December 31, 1996, and compares this return with that of the S&P 500
Composite Index and the S&P Electric Utilities Index. The graph assumes
that the value of the investment in the Corporation's Common Stock and each
index was $100 on December 31, 1991 and that all dividends were reinvested.
(Performance Graph Goes Here)
December 31,
1991 1992 1993 1994 1995 1996
TECO Energy, Inc. $100 $104 $118 $111 $148 $145
S&P Electric $100 $106 $119 $104 $136 $136
Utilities Index
S&P 500 Index $100 $108 $118 $120 $165 $203
EXECUTIVE COMPENSATION
Compensation Committee Report On Executive Compensation
The Compensation Committee of the Board of Directors, composed entirely
of independent, non-employee directors, recommends to the Board the
compensation of executive officers and administers the Corporation's long-
term incentive plan. The objective of the Corporation's compensation
program is to enhance shareholder value by attracting and retaining the
talent needed to manage and build the Corporation's businesses. The
Committee seeks, therefore, to provide compensation opportunities that are
competitive and link the interests of shareholders and executives. The
components of the Corporation's executive compensation program, base
salary, annual incentive awards and long-term incentive awards, are
described below.
Base Salary. Base salary is designed to provide each executive with a
f i xed amount of annual compensation that is competitive with the
marketplace. The Corporation's salary structure for its executive officers
utilizes various salary grade ranges and associated midpoints. Each
executive officer is assigned to a salary grade by the Board, on the
recommendation of the Committee, based on the officer's experience level
and scope of responsibility and a market assessment conducted by the
Corporation s outside consultant, Towers Perrin, of the median compensation
p a id to executives with similar positions in general industry by
organizations having comparable revenues. Each year, the Committee adjusts
the salary ranges based on surveys by outside consultants of expected
changes in compensation levels at general industrial and electric utility
companies. In 1996, as in prior years, the Committee recommended and the
Board approved adjustments to the base salaries for each executive officer,
including the CEO, taking into account the midpoint of the officer's
assigned salary grade and the Committee's subjective evaluation of the
9
officers's individual performance. After this adjustment, the CEO's base
salary was 94% of the midpoint of his assigned salary grade.
Annual Incentive Awards. The Corporation has an annual incentive
program intended to encourage actions that contribute to improved operating
and financial results which provides for incentive awards based on the
achievement of corporate and individual performance goals. If the net
income for the year targeted in the Corporation's business plan is
achieved, awards can range up to 60% of the midpoint of the salary range
for the CEO, 50% and 45% for the other named executive officers and lower
percentages for other officers. In setting these percentages, the
Committee used data from the market assessment referred to above. Under
the Corporation's program, additional payments of up to 50% of the target
awards may be made if the net income target is exceeded; lesser amounts may
be paid if the target is not achieved, but only if the Corporation s net
income exceeds the threshold designated for that year. The Board retains
discretion to vary awards in extraordinary circumstances to avoid unduly
penalizing or rewarding management.
The 1996 objectives for all the executive officers under the incentive
program included overall operating and financial performance targets
measured by the Corporation's net income and the Corporation's return on
equity. One-half of the CEO s 1996 target award was based on these
factors. Additional quantitative targets were used for some of the other
executive officers including, in the case of certain officers, targets
relating specifically to the performance of the companies for which they
have chief operating responsibility.
In addition to measuring performance against the 1996 quantitative
targets, the Committee evaluated each executive s performance against
qualitative objectives. These objectives focused on aspects of the
Corporation s business that directly related to the executive officer's
individual responsibilities. One-half of the CEO s 1996 target award was
based on these qualitative objectives which were, in his case, to provide
the leadership necessary for the growth and development of the Corporation
and to manage effectively the Corporation s external relations. The
Committee's review consisted of a subjective evaluation of his performance,
with a significant focus on long-term strategies to increase earnings while
p r eserving financial strength. Based on this evaluation and the
achievement of the 1996 net income and return on equity objectives, the CEO
received an incentive award of 84% of the midpoint of his salary grade.
Long - Term Incentive Awards. The long-term component of the
Corporation s incentive compensation program consists of equity-based
grants which have been in the form of stock options and restricted stock.
These grants are designed to create a mutuality of interest with
shareholders by motivating the CEO and the other executive officers and key
personnel to manage the Corporation s business so that the shareholders
investment will grow in value over time. The Committee s policy has been
to base individual awards on an annual study by Towers Perrin comparing the
value of long-term incentive grants to salary levels in general industry.
The Committee does not normally consider the amount of an individual's
outstanding or previously granted options or shares in determining the size
of the grant. The 20,900 shares of restricted stock granted to the CEO in
1996 reflected these policies and, as in the case of the other executive
officers, the results of the Committee s review of his performance
conducted when it considered his base salary for 1996.
10
In 1996, upon the Committee s recommendation, the Board approved stock
ownership guidelines of five times base salary for the CEO and three times
base salary for the other executive officers. These guidelines allow the
executives five years to acquire this amount of stock and do not recognize
stock options as shares owned.
With respect to qualifying compensation paid to executive officers under
Section 162(m) of the Internal Revenue Code, the Corporation does not
expect to have any significant amount of compensation exceeding the $1-
million annual limitation. Accordingly, the Committee has recommended that
the Corporation continue to structure its executive compensation program to
meet the objectives described in this report, rather than modifying it to
achieve a relatively small
decrease in its federal income tax liability. Compensation payable under
outstanding stock options and stock options granted under the Corporation's
1996 Equity Incentive Plan will not be subject to the limitation under
Section 162(m) under applicable regulations.
By the Compensation Committee,
James O. Welch, Jr. (Chairman)
Sara L. Baldwin
Henry R. Guild, Jr.
William P. Sovey
John A. Urquhart
11
The following tables set forth certain compensation information for the Chief Executive Officer
of the Corporation and each of the four other most highly compensated executive officers of the
Corporation and its subsidiaries.
Summary Compensation Table
Long-Term
Annual Compensation
Compensation Awards
Restricted Shares All Other
Name and Other Annual Stock Underlying Compen-
Principal Position Year Salary Bonus Compensation (1) Awards(2) Options/SARs(#)(3) sation(4)
Timothy L. Guzzle 1996 $526,250 $480,000 $491,150 $32,010
Chairman and Chief 1995 493,750 415,000 $50,925 60,000 31,092
Executive Officer 1994 468,750 384,000 40,000 28,703
Girard F. Anderson 1996 386,250 250,000 298,450 31,106
President and Chief 1995 368,750 240,000 48,611 40,000 30,094
Operating Officer 1994 320,461 275,000 24,000 25,076
Keith S. Surgenor 1996 295,000 215,000 206,800 14,199
President and Chief 1995 272,500 195,000 45,664 25,000 17,994
Operating Officer 1994 215,376 225,000 12,000 13,728
of Tampa Electric
Company
Roger H. Kessel 1996 248,500 163,000 143,350 11,063
Senior Vice 1995 238,500 135,000 44,765 17,000 9,052
President-General 1994 228,750 150,000 14,000 10,257
Counsel
Alan D. Oak 1996 241,750 160,000 143,350 15,248
Senior Vice 1995 225,000 135,000 44,264 17,000 14,432
President-Finance 1994 201,750 130,000 13,000 12,905
(1) Participants in the Corporation's company car program received a one-
time cash payment in connection with its elimination in 1995. The
amount set forth includes this payment, which in the case of the
named executive officers was $40,890.
(2) The reported values of the restricted stock awards were determined
using the closing market price of the Common Stock on the date of
grant. Restricted stock holdings and the values thereof based on the
12
closing price of the Common Stock on December 31, 1996 are as
follows: Mr. Guzzle, 20,900 shares ($504,213); Mr. Anderson, 12,700
shares ($306,388); Mr. Surgenor, 8,800 shares ($212,300); Mr. Kessel,
6,100 shares ($147,163); and Mr. Oak, 6,100 shares ($147,163). The
shares granted to Messrs. Guzzle, Anderson and Kessel will vest on
December 1, 1998, March 24, 1997 and January 1, 1999, respectively;
the other shares listed above will vest more than three years after
the date of grant. Holders of restricted stock receive the same
dividends as holders of other shares of Common Stock.
(3) Stock appreciation rights that can only be exercised during limited
periods following a change in control of the Corporation ( LSAR s)
were awarded in tandem with the options granted. Upon exercise of an
LSAR, the holder is entitled to an amount based upon the highest
price paid or offered for Common Stock during the 30-day period
preceding a change in control of the Corporation, as defined under
"Employment and Change in Control Arrangements" below. The exercise
of an option or an LSAR results in a corresponding reduction in the
other.
(4) The reported amounts for 1996 consist of $924 of premiums paid by the
Corporation to the Executive Supplemental Life Insurance Plan for
each of the named executive officers, with the balance in each case
being employer contributions under the TECO Energy Group Retirement
Savings Plan and Retirement Savings Excess Benefit Plan.
Aggregated Option/SAR Exercises in Last Fiscal Year and
Fiscal Year-End Option/SAR Value
Number of Value of
Shares Underlying Unexercised
Unexercised In-The-Money
Options/SARs Options/SARs
at Year-End(#) at Year-End
Shares Acquired Value Exercisable/ Exercisable/
Name on Exercise(#) Realized($) Unexercisable Unexercisable
Timothy L. Guzzle 80,000 615,000 140,000/0 $412,500/0
Girard F. Anderson 0 0 112,000/0 387,750/0
Keith S. Surgenor 14,000 167,250 77,000/0 330,000/0
Roger H. Kessel 0 0 137,000/0 930,313/0
Alan D. Oak 26,000 158,750 43,000/0 125,625/0
13
Pension Table
The following table shows estimated annual benefits payable under the
Corporation's pension plan arrangements for the named executive officers
other than Messrs. Guzzle and Kessel.
Years of Service
5 10 15 20 or More
Final
Average Earnings
$200,000 $ 30,000 $ 60,000 $ 90,000 $120,000
250,000 37,500 75,000 112,500 150,000
300,000 45,000 90,000 135,000 180,000
350,000 52,500 105,000 157,500 210,000
400,000 60,000 120,000 180,000 240,000
450,000 67,500 135,000 202,500 270,000
500,000 75,000 150,000 225,000 300,000
550,000 82,500 165,000 247,500 330,000
600,000 90,000 180,000 270,000 360,000
650,000 97,500 195,000 292,500 390,000
700,000 105,000 210,000 315,000 420,000
750,000 112,500 225,000 337,500 450,000
The annual benefits payable to each of the named executive officers are
equal to a stated percentage of such officer s final average earnings
multiplied by his number of years of service, up to a stated maximum. The
amounts shown in the table are based on 3% of such earnings and a maximum
of 20 years of service. The amounts payable to Mr. Guzzle are based on 6%
of earnings and a maximum of 10 years of service, and the amounts payable
to Mr. Kessel are based on 5% of earnings and a maximum of 12 years of
service. Final average earnings are based on the greater of (i) the
officer s final 36 months of earnings or (ii) the officer s highest three
consecutive calendar years of earnings out of the five calendar years
preceding retirement.
The earnings covered by the pension plan arrangements are the same as
those reported as salary and bonus in the summary compensation table above.
Years of service for the named executive officers are as follows: Mr.
Guzzle (9 years), Mr. Anderson (37 years), Mr. Surgenor (8 years), Mr.
Kessel (7 years) and Mr. Oak (23 years). The pension benefit is computed
as a straight-life annuity commencing at the officer's normal retirement
age and is reduced by the officer s Social Security benefits. The normal
retirement age is 62 for Messrs. Guzzle, Anderson and Kessel and 63 for
Messrs. Surgenor and Oak. The pension plan arrangements also provide death
benefits to the surviving spouse of an officer equal to 50% of the benefit
payable to the officer. If the officer dies during employment before
reaching his normal retirement age, the benefit is based on the officer's
service as if his employment had continued until such age. The death
benefit is payable for the life of the spouse. If Mr. Guzzle's employment
is terminated by the Corporation without cause or by Mr. Guzzle for good
reason (as such terms are defined in Mr. Guzzle's employment agreement
referred to below), his age and service for purposes of determining
benefits under the pension plan arrangements are increased by two years.
14
The present value of the portion of the officer s pension benefit that
is in excess of the amount payable under the Corporation s qualified
retirement plan is, at the election of the officer, payable in the form of
a lump sum.
Employment and Change in Control Arrangements
The Corporation has severance agreements with the named executive
officers under which payments will be made under certain circumstances
following a change in control of the Corporation. A change in control
means in general the acquisition by any person of 30% or more of the Common
Stock, the change in a majority of the directors or the approval by the
shareholders of a merger or consolidation of the Corporation in which the
Corporation's shareholders do not have majority voting power in the
surviving entity or of the liquidation or sale of the assets of the
Corporation. Each of these officers is required, subject to the terms of
the severance agreements, to remain in the employ of the Corporation for
one year following a potential change in control (as defined) unless a
change in control earlier occurs. The severance agreements provide that in
the event employment is terminated by the Corporation without cause (as
defined) or by one of these officers for good reason (as defined) following
a change in control, the Corporation will make a lump sum severance payment
to the officer of three times annual salary and bonus. Upon such
termination, the severance agreements also provide for: (i) a cash payment
equal to the additional retirement benefit which would have been earned
under the Corporation s retirement plans if employment had continued for
three years following the date of termination and (ii) participation in the
life, disability, accident and health insurance plans of the Corporation
for such period except to the extent such benefits are provided by a
subsequent employer.
In addition, the terms of the restricted stock awarded to the named
executive officers provide for full vesting upon a change in control.
These officers will also receive a payment to compensate for the additional
taxes, if any, payable on the benefits received under the severance
agreements and any other benefits contingent on a change in control as a
result of the application of the excise tax associated with Section 280G of
the Internal Revenue Code.
The Corporation has an employment agreement with Mr. Guzzle providing
that if his employment is terminated by the Corporation without cause or by
Mr. Guzzle for good reason, he will receive benefits similar to those
provided under the severance agreements described above based upon a level
of two times annual salary and bonus and a two-year benefit continuation
period. Consistent with his employment agreement, certain of Mr. Guzzle's
option grants provide for a two-year exercise extension period in the event
of such a termination.
15
APPROVAL OF THE
1997 DIRECTOR EQUITY PLAN
General
On January 15, 1997, the Board of Directors adopted, subject to
shareholder approval, the 1997 Director Equity Plan (the "Plan") as
an amendment and restatement of the Corporation's 1991 Director Stock
Option Plan (the "1991 Plan"). If the Plan is approved by shareholders,
the Plan will supersede the 1991 Plan and no additional grants
will be made thereunder. The rights of the holders of outstanding options
under the 1991 Plan will not be affected. The purpose of the Plan is to
attract and retain highly qualified non-employee directors of the
Corporation and to encourage non-employee directors to own shares of the
Common Stock. As of February 14, 1997, there were 12 non-employee
directors who would be eligible to participate in the Plan. The Plan
will be administered by the Board.
Termination of Directors Retirement Plan
If the Plan is approved by shareholders, the Directors Retirement Plan
will be terminated effective as of December 31, 1996. See "Election of
Directors Compensation of Directors" above.
Proposed Amendments to the 1991 Plan
Approval of the Plan would amend the 1991 Plan to increase the number of
shares of Common Stock subject to grants by 250,000 shares, expand the
types of awards available to be granted and replace the current fixed
formula grant by giving the Board discretionary authority to determine the
amount and timing of awards under the Plan. The Board of Directors
believes (i) the increase in shares is needed to ensure that a sufficient
number of shares are available to be issued under the Plan in the future
and (ii) the additional types of awards available under the Plan will
provide broad flexibility in the structuring of appropriate equity-based
compensation to further align the interests of directors with those of
shareholders.
Shares Subject to Awards
As of February 14, 1997, 246,000 shares were available for awards under
the 1991 Plan. The proposed Plan would add 250,000 shares, bringing the
total number of shares available for awards under the Plan to 496,000, or
less than 1/2 of 1% of the Corporation's outstanding shares, as of
February 14, 1996. The number and kind of shares are subject to adjustment
to reflect stock dividends, recapitalizations or other changes affecting
the Common Stock. If any outstanding or future award under the 1991 Plan
or the Plan expires or is terminated unexercised or settled in a manner
that results in fewer shares outstanding than were initially awarded, the
shares which would have been issuable will again be available for award
under the Plan. The closing price of the Common Stock on the New York
Stock Exchange on February 14, 1997 was $24.50 per share.
16
Description of Awards
The 1991 Plan currently provides for the automatic grant of a fixed
number of stock options on an annual basis. The amendment to the 1991 Plan
would provide additional flexibility to the Board to determine the amount,
timing and terms and conditions of stock options and would allow stock
grants and other awards measured by the value of the Common Stock. As
amended, the Plan would provide the following three basic types of awards:
Stock Grants. The Board may make stock grants for no consideration,
for such minimum consideration as may be required by applicable law or
for such other consideration as the Board may determine. Stock grants
may include without limitation the payment of retainer and meeting fees
or other director compensation in stock (either on a mandatory basis or
at the election of the director), shares subject to forfeiture
("restricted stock"), grants conditioned upon attainment of performance
c r i teria ("performance shares"), restricted stock where vesting
accelerates upon attainment of performance criteria ("performance-
accelerated restricted stock") and outright stock grants ("bonus
stock"). With respect to any stock grant, the Board has full discretion
to determine the number of shares subject to the grant and the terms and
conditions of the grant.
Stock Options. The Board may grant options to purchase Common Stock.
Stock options may include without limitation options where the exercise
price is adjusted to reflect market changes ( indexed stock options ),
options that become exercisable based on attainment of performance
c r iteria ("performance-vested stock options"), options where
exercisability is accelerated upon attainment of performance criteria
("performance-accelerated stock options") and options that entitle the
optionee to an additional option grant at current fair market value to
replace shares used to exercise the options ("reload stock options").
The Board will determine the option price, term and exercise period of
each option granted, provided that the option price may not be less than
the fair market value of the Common Stock on the date of grant. An
option may be exercised by the payment of the option price in whole or
in part in cash or, to the extent permitted by the Board, by delivery of
a promissory note or shares of Common Stock owned by the director valued
at fair market value on the date of delivery, or such other lawful
consideration as the Board may determine.
Stock Equivalents. The Board may make awards where the amount to be
paid to the director is based on the value of the Common Stock. Stock
equivalents may include without limitation payments based on the full
value of the Common Stock ("phantom stock"), payments based on the value
o f t h e Common Stock upon attainment of performance criteria
("performance units"), rights to receive payments based on dividends
paid on the Common Stock ("dividend equivalents") and SARs where the
director receives payment equal in value to the difference between the
exercise price of the award and the fair market value of the Common
Stock on the date of exercise. SARs may be granted in tandem with
options (at or after award of the option) or alone and unrelated to an
option. SARs granted in tandem with an option terminate to the extent
that the related option is exercised, and the related option terminates
to the extent that the tandem SAR is exercised. The exercise price of
an SAR may not be less than the fair market value of the Common Stock on
17
the date of grant or, in the case of a tandem SAR, the exercise price of
the related option. The Board also has discretion to grant any other
type of stock equivalent award and to determine the terms and conditions
of payment of the award and whether payment values will be settled in
whole or in part in cash or other property, including Common Stock.
Awards under the Plan may contain such terms and conditions not
inconsistent with the Plan as the Board in its discretion approves. The
Board has discretion to administer the Plan in the manner which it
determines, from time to time, is in the best interest of the Corporation.
For example, the Board will fix the terms of stock options, stock grants
and stock equivalents and determine whether, in the case of options and
SARs, they may be exercised immediately or at a later date or dates.
Awards may be granted subject to conditions relating to continued service
as a director and restrictions on transfer. The Board may provide, at the
time an award is made or at any time thereafter, for the acceleration of a
director's rights or cash settlement upon a change in control of the
Corporation. The terms and conditions of awards need not be the same for
each director. The foregoing examples illustrate, but do not limit, the
manner in which the Board may exercise its authority in administering the
Plan.
The foregoing summary of the Plan is qualified by reference to the full
text of the Plan attached as Appendix A to this proxy statement.
Amendment
The Board has authority to amend the Plan subject to any shareholder
approval that the Board determines is necessary or advisable. The Board
has authority to amend outstanding awards, including changing the date of
exercise of an option, if the Board determines that such actions would not
adversely affect the director. The Plan has no expiration date.
Benefits to Directors
All non-employee directors (currently, all directors except for Mr.
Guzzle and Mr. Anderson) will be eligible to participate in the Plan. The
benefits or amounts that each such person will receive depend on the amount
and type of awards authorized by the Board under the Plan from time to
time. With respect to compensation for 1997, the Board has voted, subject
to shareholder approval of the Plan, to provide each eligible director the
following: an annual grant of options for 2,000 shares (10,000 shares in
the case of a new director) of Common Stock exercisable for a term of ten
years, an annual grant of 325 shares of Common Stock and the opportunity to
elect to receive all or a portion (in 25% increments) of the director's
cash compensation in shares of Common Stock, including the cash portion of
the payment to which they are entitled upon termination of the Directors
Retirement Plan. If directors elect to receive all of such termination
payment in stock, a total of approximately 47,000 shares (based on the
closing price of the Common Stock on February 14, 1997) would be issued in
connection with the termination of the Directors Retirement Plan. See
Election of Directors Compensation of Directors above.
The number of shares subject to options previously granted to eligible
directors under the 1991 Plan is set forth in footnote 1 to the table
s e tting forth information with respect to share ownership of the
18
Corporation's directors and nominees, its executive officers named in the
summary compensation table and its directors and executive officers as a
group. See "Share Ownership" above.
Federal Income Tax Consequences Relating to Stock Options
No income is realized by the optionee at the time an option is granted.
Upon exercise, (i) ordinary income is realized by the optionee in an amount
equal to the difference between the option price and the fair market value
of the shares on the date of exercise and (ii) the Corporation receives a
tax deduction for the same amount. Upon disposition of the shares,
appreciation or depreciation after the date of exercise is treated as a
short-term or long-term capital gain or loss and will not result in any
deduction by the Corporation.
The Board of Directors recommends a vote FOR this proposal.
INFORMATION CONCERNING AUDITORS AND AUDIT COMMITTEE
The Audit Committee reviews the scope of the audit procedures followed
by the independent accountants and the results of their yearly audit,
including the audited financial statements. The Committee also reviews the
Corporation s internal auditing policies and procedures and the adequacy of
the system of internal accounting and financial controls. After its review
of the yearly audit, the Committee recommends the independent accountants
to be appointed for the following year.
Based on the Audit Committee s recommendation in April 1996, the Board
reappointed Coopers & Lybrand L.L.P. to serve as independent accountants
and to audit the Corporation s financial statements for 1996. Consistent
with past procedures, independent accountants for the current fiscal year
will be appointed by the Board at its April 1997 meeting.
Representatives of Coopers & Lybrand L.L.P. are expected to be present
at the Annual Meeting of Shareholders and to be available to respond to
appropriate questions. They will also have the opportunity to make a
statement if they so desire.
DEADLINE FOR SHAREHOLDER PROPOSALS
Proposals of shareholders intended to be presented at the 1998 Annual
Meeting of Shareholders must be received on or before November 3, 1997 for
inclusion in the Corporation s proxy materials relating to that meeting.
Any such proposals should be sent to: Secretary, TECO Energy, Inc., P.O.
Box 111, Tampa, Florida 33601.
ADVANCE NOTICE PROVISIONS FOR SHAREHOLDER PROPOSALS AND NOMINATIONS
The Bylaws of the Corporation provide that in order for a shareholder to
bring business before or propose director nominations at an annual meeting,
the shareholder must give written notice to the Secretary of the
Corporation not less than 90 days before the meeting. The notice must
contain specified information about the proposed business or each nominee
and the shareholder making the proposal or nomination. If the annual
meeting is scheduled for a date that is not within ten days of the third
19
Tuesday in April and notice thereof is mailed to shareholders or publicly
disclosed less than 100 days in advance, the notice given by the
shareholder must be received no later than the tenth day following the day
on which the notice of such annual meeting date was mailed or public
disclosure made, whichever first occurs.
SOLICITATION OF PROXIES
In addition to the solicitation of proxies by mail, proxies may be
solicited by telephone, facsimile or in person by regular employees of the
Corporation. The Corporation has also retained Morrow & Co., Inc. to
assist in the solicitation of proxies for a fee of $6,000 plus out-of-
pocket expenses. All expenses of this solicitation, including the cost of
preparing and mailing this proxy statement, and the reimbursement of
brokerage houses and other nominees for their reasonable expenses in
forwarding proxy material to beneficial owners of stock, will be paid by
the Corporation.
OTHER MATTERS
The Board of Directors does not know of any business to be presented at
the meeting other than the matters described in this proxy statement. If
other business is properly presented for consideration at the meeting, the
enclosed proxy authorizes the persons named therein to vote the shares in
their discretion.
20
APPENDIX A
TECO ENERGY, INC.
1997 DIRECTOR EQUITY PLAN
1. Purpose.
The purpose of the TECO Energy, Inc. 1997 Director Equity Plan (the
"Plan") is to attract and retain highly qualified non-employee directors of
TECO Energy, Inc. (the "Company") and to encourage non-employee directors
to own shares of the Company's Common Stock, $1.00 par value (the "Common
Stock"). The Plan is an amendment and restatement of the 1991 Director
Stock Option Plan (the "1991 Plan"). No provision of the Plan will affect
the rights and privileges of holders of outstanding options under the 1991
Plan.
2. Administration.
The Plan will be administered by the Board of Directors of the Company
(the "Board"). The Board will determine the terms and conditions of all
awards under the Plan ( Awards ). The Board will have authority to adopt,
alter and repeal such administrative rules, guidelines and practices
governing the operation of the Plan as it from time to time considers
advisable, and to interpret the provisions of the Plan. The Board's
decisions will be final and binding.
3. Eligibility.
All directors of the Company who are not employees of the Company or any
subsidiary of the Company will be eligible to participate in the Plan (a
"Director").
4. Stock Available for Awards.
(a) Amount. Subject to adjustment under subsection (b), Awards may be
made under the Plan for up to 250,000 shares of Common Stock, together with
all shares of Common Stock available for issue under the 1991 Plan on the
effective date of the Plan. If any Award (including any stock option under
the 1991 Plan) expires or is terminated unexercised or is forfeited or
settled in a manner that results in fewer shares outstanding than were
awarded, the shares subject to such Award, to the extent of such
expiration, termination, forfeiture or decrease, will again be available
for award under the Plan. Common Stock issued through the assumption or
substitution of outstanding awards from an acquired company will not reduce
the shares available for Awards under the Plan. Shares issued under the
Plan may consist in whole or in part of authorized but unissued shares or
treasury shares.
(b) Adjustment. In the event that the Board determines that any stock
dividend, extraordinary cash dividend, recapitalization, reorganization,
merger, consolidation, split-up, spin-off, combination, exchange of shares
or other change affects the Common Stock such that an adjustment is
required in order to preserve the benefits intended to be provided by the
Plan, then the Board will equitably adjust any or all of (i) the number and
A - 1
kind of shares for which Awards may be made under the Plan, (ii) the number
and kind of shares subject to outstanding Awards and (iii) the exercise
price with respect to any of the foregoing. In making such adjustments,
the Board may ignore fractional shares so that the number of shares subject
to any Award will be a whole number. If considered appropriate, the Board
may make provision for a cash payment with respect to all or part of an
outstanding Award instead of or in addition to any such adjustment.
5. Types of Awards.
(a) Stock Grants. The Board may make awards of shares of Common Stock
("Stock Grants") to Directors upon such terms and conditions as the Board
determines. Stock Grants may include without limitation the payment of
retainer and meeting fees or other Director compensation in stock (either
on a mandatory basis or at the election of the Director), restricted stock,
performance shares, performance-accelerated restricted stock and bonus
stock. Stock Grants may be issued for no cash consideration, such minimum
consideration as may be required by applicable law or such other
consideration as the Board may determine.
(b) Stock Options. The Board may grant options ("Stock Options") to
purchase shares of Common Stock at an exercise price determined by the
Board of not less than 100% of the fair market value of the Common Stock on
the date of grant and upon such terms and conditions as the Board
determines. Stock Options may include without limitation indexed stock
options, performance-vested stock options, performance-accelerated stock
options and reload options. Payment of the exercise price may be made in
cash or, to the extent permitted by the Board at or after the grant of the
Stock Option, in whole or in part by delivery of a promissory note or
shares of Common Stock owned by the optionee, including Stock Grants, or by
retaining shares otherwise issuable pursuant to the Stock Option, in each
case valued at fair market value on the date of delivery or retention, or
such other lawful consideration as the Board may determine.
(c) Stock Equivalents. The Board may grant rights to receive payment
from the Company based in whole or in part on the value of the Common Stock
("Stock Equivalents") upon such terms and conditions as the Board
determines. Stock Equivalents may include without limitation phantom
stock, performance units, dividend equivalents and stock appreciation
rights ("SARs"). SARs granted in tandem with a Stock Option will terminate
to the extent that the related Stock Option is exercised, and the related
Stock Option will terminate to the extent that the tandem SARs are
exercised. An SAR will have an exercise price determined by the Board of
not less than 100% of the fair market value of the Common Stock on the date
of grant, or of not less than the exercise price of the related Stock
Option in the case of an SAR granted in tandem with a Stock Option. The
Board will determine at the time of grant or thereafter whether Stock
Equivalents are to be settled in cash, Common Stock or other securities of
the Company, other Awards or other property.
6. General Provisions Applicable to Awards.
(a) Fair Market Value. The fair market value of the Common Stock or any
other property will be the fair market value of such property as determined
A - 2
by the Board in good faith or in the manner established by the Board from
time to time.
(b) Documentation. Each Award under the Plan will be evidenced by a
writing delivered to the Director specifying such terms and conditions not
inconsistent with the provisions of the Plan as the Board considers
necessary or advisable to achieve the purposes of the Plan. These terms
and conditions may include without limitation performance criteria, vesting
requirements, restrictions on transfer and payment rules. The Board may
establish the terms and conditions at the time the Award is granted or may
provide that such terms and conditions will be determined by it at any time
thereafter.
(c) Board Discretion. Each type of Award may be made alone, in addition
to or in relation to any other Award. Awards may be made automatically on
terms established by the Board. The terms of each type of Award need not
be identical, and the Board need not treat Directors uniformly. Except as
otherwise provided by the Plan or a particular Award, any determination
with respect to an Award may be made by the Board at the time of grant or
at any time thereafter.
(d) Dividends and Cash Awards. In the discretion of the Board, any
Award under the Plan may provide the Director with (i) dividends or
dividend equivalents payable currently or deferred with or without interest
and (ii) cash payments in lieu of or in addition to an Award.
(e) Termination of Service. The Board will determine the effect on an
Award of the disability, death or termination of service of a Director and
the extent to which, and the period during which, the Director's legal
representative, guardian or beneficiary may receive payment of an Award or
exercise rights thereunder. A Director may designate a beneficiary in a
manner determined by the Board. In the absence of an effective
designation, a Director's beneficiary will be the Director's estate.
(f) Loans. The Board may authorize the making of loans or cash payments
to Directors in connection with the grant or exercise of any Award under
the Plan, which loans may be secured by any security, including Common
Stock, underlying such Award, and which may be forgiven upon such terms and
conditions as the Board may establish at the time of such loan or at any
time thereafter.
(g) Amendment of Award. The Board may amend, modify or terminate any
outstanding Award, including substituting therefor another Award of the
same or a different type and changing the date of exercise or realization,
provided that the Director's consent to such action will be required unless
the action, taking into account any related action, would not adversely
affect the Director.
(h) Change in Control. In order to preserve a Director s rights under
an Award in the event of a change in control of the Company, the Board in
its discretion may, at the time an Award is made or at any time thereafter,
take one or more of the following actions: (i) provide for the acceleration
of any time period relating to the exercise or payment of the Award, (ii)
provide for payment to the Director of cash or other property with a fair
market value equal to the amount that would have been received upon the
A - 3
exercise or payment of the Award had the Award been exercised or paid upon
the change in control, (iii) adjust the terms of the Award in a manner
determined by the Board to reflect the change in control, (iv) cause the
Award to be assumed, or new rights substituted therefor, by another entity
or (v) make such other provision as the Board may consider equitable to the
Director and in the best interests of the Company.
7. Miscellaneous.
(a) No Right To Continue as Director. Neither the Plan nor any Award
hereunder will be deemed to constitute an agreement or understanding that
the Company will retain a Director for any period of time or at any
particular rate of compensation.
(b) No Rights As Shareholder. No Director or beneficiary will have any
rights as a shareholder with respect to any shares of Common Stock to be
distributed under the Plan until he or she becomes the holder thereof. A
Director to whom Common Stock is granted will be considered the holder of
such Common Stock at the time of the Award except as otherwise provided in
the applicable Award.
(c) Effective Date. The Plan will be effective on April 16, 1997.
(d) Amendment of Plan. The Board of Directors of the Company may amend,
suspend or terminate the Plan or any portion thereof at any time, subject
to any shareholder approval that the Board determines to be necessary or
advisable, provided that a Director's consent will be required for any
amendment, suspension or termination that would adversely affect the rights
of the Director under any outstanding Award.
(e) Governing Law. The provisions of the Plan will be governed by and
interpreted in accordance with the laws of Florida.
A - 4
APPENDIX B
TECO Energy, Inc.
1997 Annual Meeting
Wednesday April 16, 1997
TECO Plaza
702 North Franklin Street
Tampa, Florida
Attached below is a proxy card for the 1997 Annual Meeting of Shareholders
of TECO Energy, Inc.
Please detach the proxy card and mark the boxes to indicate how your
shares should be voted. Sign and return your proxy as soon as possible in
the enclosed postage-paid envelope.
Please see the reverse side for important general shareholder information.
B - 1
DETACH HERE
/X/ Please mark votes as in this example.
1. ELECTION OF DIRECTORS
The Board Recommends a Vote FOR all Nominees.
Instructions - To vote against any individual nominee(s), mark Box (C) and
write the name(s) of such nominee(s) above the line provided below.
Nominees: S.L. Baldwin, H.L. Culbreath, E. L. Flom, H. R. Guild, Jr., and
W.P. Sovey
/ / (A) FOR ALL NOMINEES/ / (B) AGAINST ALL NOMINEES
/ / (C)
FOR ALL NOMINEES EXCEPT
/ / MARK HERE FOR ADDRESS CHANGE AND NOTE BELOW
2. PROPOSAL TO APPROVE THE 1997 DIRECTOR EQUITY PLAN
The Board Recommends a Vote FOR the Proposal.
/ / FOR / / AGAINST
/ / ABSTAIN
In their discretion, the proxies are also authorized to vote upon
such other matters as may properly come before the meeting.
This proxy will be voted as specified, or if no specification is
made, FOR Proposals 1 and 2.
PLEASE SIGN AND MAIL THIS PROXY TODAY
INSTRUCTIONS - Signatures should correspond exactly with the name or names
of Shareholders as they appear on this proxy. Persons signing as Attorney,
Executor, Administrator, Trustee or Guardian should give their full titles.
Execution on behalf of corporations should be by a duly authorized officer
and on behalf of partnerships by a general partner or in the firm name by
another duly authorized person.
Signature: ________ Date: _________ Signature: ____________ Date: ______
B - 2
TECO Energy, Inc.
GENERAL SHAREHOLDER SERVICES INFORMATION
Transfer Agent - Bank of Boston c/o Boston EquiServe
(800) 650-9222
Questions regarding your individual account, changes of address,
replacement of lost certificates, dividends and general transfer
requirements should be directed to the transfer agent.
TECO Energy offers electronic deposit of dividends to your bank account.
For more information and enrollment forms please contact Boston EquiServe.
Mailing address
Bank of Boston
c/o Boston EquiServe L.P.
Mail Stop 45-02-09
P.O. Box 8040
Boston , MA 02266-8040
TECO Energy, Inc. Shareholder Services
(800) 810-2032
TECO ENERGY, INC.
Proxy for Annual Meeting of Shareholders, April 16, 1997
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS OF
TECO ENERGY, INC.
The undersigned hereby constitutes and appoints Hugh L. Culbreath, Henry
R. Guild, Jr. and Timothy L. Guzzle and any one or more of them, attorneys
and proxies of the undersigned, with full power of substitution to each
attorney and substitute, for and in the name of the undersigned to appear
and vote all shares of Common Stock of TECO Energy, Inc. standing in the
name of the undersigned as of the close of business February 14, 1997, at
the Annual Meeting of Shareholders of the Corporation to be held in
accordance with notice received at the principal office of the Corporation,
TECO Plaza, 702 North Franklin Street, Tampa, Florida, on April 16, 1997 at
11:30 A.M., and at any and all adjournments thereof, with all powers the
undersigned would have if personally present, hereby revoking all proxies
previously given.
(THIS PROXY IS CONTINUED AND IS TO BE SIGNED ON REVERSE SIDE)
SEE REVERSE SIDE
B - 3