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EXHIBIT 10.39
[DETROIT EDISON LETTERHEAD]
July 24, 2000
Mr. Eric H. Peterson
2207 Cambria Boulevard
Dallas, Texas 75214
Dear Eric:
Pursuant to approval by the Board of Directors, I am pleased to offer you
employment in the position of Senior Vice President and General Counsel at an
annual salary of $325,000.
Upon employment, you will be eligible for the benefits described in the Benefit
Highlights brochure enclosed, as well as the perquisites described on a
separate listing also enclosed. In addition, you will receive the following:
- - You will receive a signing bonus of $100,000 to be paid in your first
paycheck.
- - You will receive an immediate annual benefit of two weeks (10 days) vacation
for 2000. In subsequent years you will receive four weeks (20 days) of
vacation.
- - You will be paid an amount (considered imputed income to be grossed up for
taxes) to cover the premium for three (3) months health care coverage for you
and your dependents under the Company's plan. After that you will be
eligible for normal participation in the Company's health care plan.
- - You will be eligible to participate in our supplemental executive retirement
plan. The current design is under review and is likely to change. The new
plan is being designed to provide competitive retirement benefits.
- - You will be eligible to participate in our annual incentive plan. The plan
provides for a target annual bonus of 50% of salary with a potential award of
100% adjusted for performance. For the year 2000, you will be eligible for a
pro-rata share of the applicable bonus. However, the bonus will be adjusted
to ensure that your 2000 total cash compensation from DTE Energy and your
prior employer is at least $450,000.
- - You will be eligible for annual grants under our Long-Term Incentive Plan
that provides for a target award of 60% of salary (30% in performance shares
and 30% in stock options). Performance share grants pay out in accordance
with performance on a number of corporate goals with a potential award of
200% of the grant.
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Mr. Eric H. Peterson
July 24, 2000
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- - You will be eligible for relocation assistance that will include interim
living for 90 days, moving your household goods and assistance in selling
your home. See the enclosed relocation guide.
- - You will be eligible for a mortgage differential payment of up to $3,000
per month for three years after employment. This payment will be calculated
as the difference between your current mortgage payment and your mortgage
payment on your home in Michigan.
- - As a Senior Vice President, you will receive a change-in-control severance
arrangement.
Subject to the approval of the Special Committee on Compensation of the Board of
Directors, you will be granted the following shares of stock pursuant to our
Long-Term Incentive Plan:
- - 8,000 shares of restricted stock in the Long-Term Incentive Plan with a
vesting period of four (4) years from the date of grant. These shares will
pay current dividends in accordance with the Company's dividend policy. At
current policy, this would equal $16,480.
- - 10,000 shares of nonqualified stock options (vesting annually over four
years from the date of grant).
This offer is subject to successful completion of a pre-employment physical
examination and a review of references.
Please contact me at (313) 235-8610 after you have completed your review of this
offer of employment. I hope to hear from you soon.
Sincerely,
/s/ Sandra J. Miller
Attachments
Accepted:
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Eric H. Peterson Date