SCHEDULE 14A INFORMATION
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TECO Energy, Inc.
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TECO ENERGY, INC.
March 3, 1995
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD ON APRIL 19, 1995
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 19, 1995 at 10:00 a.m., local
time, for the following purposes:
1. To elect four directors.
2. 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 17, 1995
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<PAGE>
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, 1995.
VOTING OF SECURITIES
As of February 17, 1995, the record date for the determination of
shareholders entitled to vote at the meeting, the Corporation had
outstanding 116,311,631 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.
A b stentions 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 four nominees for director
named below.
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. Abstentions will be considered as represented
at the meeting and, therefore, will be the equivalent of a negative vote.
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. Messrs. Anderson, Guzzle, Touchton and Urquhart have been
nominated for a term expiring in 1998, 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 recommend.
1<PAGE>
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 62 President and ,
Chief Operating Officer 1994 1995
TECO Energy, Inc.;
formerly Executive Vice
President-Utility Operations,
TECO Energy, Inc. and President
and Chief Operating Officer,
Tampa Electric Company
DuBose Ausley 57 Chairman, Macfarlane, Ausley, 1992 1996
Ferguson & McMullen (attorneys),
Tallahassee, Florida; also a
director of Sprint Corporation and
Capital City Bank Group Inc.
Sara L. Baldwin 63 Private Investor; formerly Vice 1980 1997
President, Baldwin and Sons, Inc.
(insurance agency), Tampa, Florida
Hugh L. Culbreath 73 Retired; formerly Chairman of the 1971 1997
Board, TECO Energy, Inc. and
Tampa Electric Company
James L. Ferman, Jr. 51 President, Ferman Motor Car 1985 1996
Company, Inc. (automobile
dealerships), Tampa, Florida
Edward L. Flom 65 Retired; formerly Chairman of 1980 1997
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. 66 President and Director, Guild, 1980 1997
Monrad & Oates, Inc. (private
trustees and family investment
advisers), Boston, Massachusetts
*Timothy L. Guzzle 58 Chairman of the Board and Chief 1988 1995
Executive Officer, TECO Energy, Inc.;
formerly President and Chief Operating
Officer, TECO Energy, Inc.; also a
director of NationsBank Corporation
2<PAGE>
Principal Occupation During Present
Last Five Years and Director Term
Name Age Other Directorships Held(1) Since(1) Expires
Robert L. Ryan 51 Senior Vice President and 1991 1996
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 Riverwood International
Corporation and Inter-Regional
Financial Group, Inc.
*J. Thomas Touchton 56 Managing Partner, The Witt- 1987 1995
Touchton Company (private
investment partnership),
Tampa, Florida; also a director
of 19 Merrill Lynch-sponsored
mutual funds
*John A. Urquhart 66 President, John A. Urquhart 1991 1995
Associates (management
consultants), Fairfield,
Connecticut; formerly Senior Vice
President, G. E. Industrial & Power
Systems, General Electric Company;
also a director of Enron Corp.,
Hubbell, Inc. and Aquarion Company
James O. Welch, Jr. 63 Retired; formerly Vice Chairman, 1976 1996
RJR Nabisco, Inc. and Chairman,
Nabisco Brands, Inc.; also a
director of 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 six meetings in 1994. All directors
attended at least 75% of the meetings of the Board and Committees on which
they served.
3<PAGE>
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 1994, is currently
composed of Mrs. Baldwin and Messrs. Guild, Urquhart and Welch (Chairman).
The Audit Committee, which met twice in 1994, is currently composed of
Messrs. Ferman, Flom, Ryan and Touchton (Chairman). For additional
information about the Compensation Committee and the Audit Committee, see
"Executive Compensation Compensation Committee Report on Executive
Compensation and Information Concerning Auditors and Audit Committee
below.
The Corporation paid $915,888 for legal services rendered during 1994
by Macfarlane, Ausley, Ferguson & McMullen, of which Mr. Ausley is the
Chairman.
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 $20,000 and a fee
of $1,000 for attendance at each meeting of the Board of Directors and $500
($600 for the Committee Chairman) for attendance at each meeting of a
Committee of the Board. 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 severance benefits (in the event of
termination of Mr. Culbreath s consultancy following a change in control)
similar to the benefits described under Executive Compensation Employment
and Severance Agreements below, including a lump sum cash payment of three
times annual compensation, except that the amount of such payment is
limited to the total of all consulting fees that would have become due
under the agreement.
1991 Director Stock Option Plan. The Corporation has a Director Stock
Option Plan in which all non-employee directors participate. The plan
provides automatic annual grants of options to purchase shares of Common
Stock to each non-employee director serving on the Board at the time of
grant. 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 following election to the Board and an annual grant of options
for 2,000 shares to each continuing director. Annual grants are made on
the first trading day of the Common Stock after each annual meeting. 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.
4<PAGE>
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 a
Directors Retirement Plan. Under this plan, a retired director or his or
her surviving spouse will receive a monthly retirement benefit equal to the
monthly retainer last paid to such director for services as a director of
the Corporation or any of its subsidiaries. Such payments will continue
for the lesser of the number 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.
SHARE OWNERSHIP
The following table sets forth information with respect to all persons
who are known to the Corporation to be the beneficial owner of more than
five percent of the outstanding Common Stock.
Name and Address Shares Percent of Class
Franklin Resources, Inc. 6,385,550 (1) 5.5%
("Franklin")
777 Mariners Island Blvd.
San Mateo, California 94404
(1) Franklin's ownership information is based on its Schedule 13G filed
with the Securities and Exchange Commission, dated February 10, 1995,
which reported that Franklin had sole voting power over 6,381,150 of
these shares and shared investment power over all of these shares.
T h e following table sets forth the shares of Common Stock
beneficially owned as of January 31, 1995 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, 1995.
Name Shares (1) Name Shares (1)
Girard F. Anderson 128,095 (2)(3) J. Thomas Touchton 20,000(11)
DuBose Ausley 19,322 John A. Urquhart 17,301(12)
Sara L. Baldwin 18,918 (4) James O. Welch, Jr. 24,600 (13)
Hugh L. Culbreath 73,850 (5) Keith S. Surgenor 76,614(2)(14)
James L. Ferman, Jr. 24,163 (6) Roger H. Kessel 121,627(2)
Edward L. Flom 18,784 (7) Alan D. Oak 81,349(2)(15)
Henry R. Guild, Jr. 124,373 (8) All directors and
Timothy L. Guzzle 183,445 (2)(9) executive officers
Robert L. Ryan 18,000 (10) as a group
(15 persons) 900,591(2)(16)
5<PAGE>
(1) The amounts listed include the following shares that are subject to
options granted under the Corporation s stock option plans: Mr.
Ausley, 14,000 shares; Mrs. Baldwin and Messrs. Culbreath, Ferman,
Flom, Guild, Ryan, Touchton and Welch, 16,000 shares each; Mr.
Urquhart, 13,200 shares; Mr. Guzzle, 160,000 shares; Mr. Anderson,
96,000 shares; Mr. Surgenor, 66,000 shares; Mr. Kessel, 120,000
shares; Mr. Oak, 52,000 shares; and all directors and executive
officers as a group, 649,200 shares.
(2) The amounts listed include the following shares that are held by
benefit plans of the Corporation for an officer s account: Mr.
Guzzle, 1,445 shares; Mr. Anderson, 8,175 shares; Mr. Surgenor,
1,938 shares; Mr. Kessel, 1,627 shares; Mr. Oak, 9,219 shares; and
all directors and executive officers as a group, 22,404 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 859 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.
(8) Includes 105,973 shares held by trusts of which Mr. Guild is a
trustee. Of these shares, 49,850 are held for the benefit of Mr.
Culbreath and are also included in the number of shares beneficially
owned by him.
(9) Includes 20,000 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 8,580 shares owned jointly by Mr. Surgenor and his wife.
(15) Includes 20,130 shares owned jointly by Mr. Oak and his wife.
(16) Includes a total of 33,294 shares owned jointly with spouses. Also
includes a total of 12,255 shares owned by spouses, as to which
shares beneficial interest is disclaimed.
6<PAGE>
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, 1994, 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, 1989 and that all dividends were reinvested.
(PERFORMANCE GRAPH INSERTED HERE)
December 31,
1989 1990 1991 1992 1993 1994
TECO Energy, Inc. $100 $121 $157 $163 $185 $174
S&P Electric $100 $103 $134 $141 $159 $138
Utilities Index
S&P 500 Index $100 $97 $126 $136 $150 $152
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 stock
option 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
program are base salary, annual incentive awards and stock option grants.
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. Base salary ranges for each of the executive officers were
initially established by the Board, on the recommendation of the Committee.
In developing these ranges, the Committee considered each officer's
experience level and scope of responsibility, as well as surveys by outside
consultants that contained competitive executive compensation data for
companies with comparable annual revenues. One of these surveys covered
all industry sectors and the other covered only the electric utility
industry. The companies in these surveys do not correspond to the companies
in the comparative indices shown above in the performance graph. The
Committee generally sought to establish its salary ranges at about the
median in relation to the companies surveyed, after weighting of the
general industry and electric utility industry data based upon the nature
of the executive officer position. Utility data and general industry data
7<PAGE>
were used with equal weight for the Chief Executive Officer. The salary
levels for the executive officers are, on average, above the median for the
electric utility industry and below the median for general industrial
companies.
In 1994, the Committee reviewed, as it had done in prior years, surveys
by outside consultants of expected changes in compensation levels and
amounts to be made available for merit increases for general industrial and
electric utility companies. In 1994, the Committee adjusted the salary
ranges to reflect such changes in compensation levels and designated the
aggregate amount available as a pool for merit increases based on (i) the
survey information, (ii) the Corporation s performance in 1993, taking into
account that year's business plan, operating and net income and stock
market performance and (iii) the Corporation's 1994 business plan. From
this merit pool, the Committee recommended and the Board approved a salary
increase for the CEO, taking into account all of the above corporate
performance factors, which were uniformly positive in 1993, as well as the
1994 business plan. Although these factors were not quantitatively
weighted, principal reliance was placed on increased net income in 1993 and
a subjective evaluation of the CEO's individual performance. Prior to and
after this increase, the CEO's base salary was close to the midpoint of his
assigned salary range.
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. As previously
administered, if the net income for the year targeted in the Corporation's
business plan was achieved, awards would range up to 35% of the midpoint of
the salary range for the CEO, 35% and 30% for the other named executive
officers and 25% for the remaining executive officer. In setting these
percentages, the Committee used the same general industry and electric
utility industry data considered by it in establishing the base of salary
ranges referred to above. Additional payments of up to 50% of the target
awards could be made if the net income target was exceeded; lesser amounts
could be paid if the target was not achieved, but only if the Corporation s
net income exceeded the threshold designated for that year. The Board
retained discretion to vary awards in extraordinary circumstances to avoid
unduly penalizing or rewarding management.
In early 1995, the Compensation Committee concluded and the Board
concurred that the incentive component of total compensation has been
inadequate over the past several years because it did not adequately
recognize the increasing complexity of managing companies engaged in the
e l e c tric industry, the growing significance of the Corporation's
unregulated diversified operations and the superior performance of the
Corporation over the past five years measured principally by its return on
equity and earnings-per-share growth compared to the other 76 investor-
owned electric utilities covered by a recent survey. This survey, reported
in a prominent financial publication, included all of the 23 companies
comprising the S&P Electric Utilities Index shown above in the performance
graph. In connection with 1994's awards, therefore, the Committee
recommended to the Board and the Board approved incentive awards to
executive officers that substantially exceeded the amounts that would have
been granted under the incentive program as previously administered. The
8<PAGE>
aggregate incentive awards to the executive officers constituted 78% of
their 1994 base salaries compared to 39% in 1993. In addition, the
Committee decided to undertake, with the assistance of outside consultants,
a comprehensive review of the incentive program as well as the other
components of the compensation program for executive officers.
The 1994 objectives for all the executive officers under the incentive
program included an overall operating and financial performance target
measured by the Corporation's net income. Certain executive officers also
had an objective measured by the Corporation's return on equity. One-half
of the CEO s 1994 target award was based on these factors. Additional
quantitative targets were used for the other executive officers including,
in the case of certain executive officers, targets relating specifically to
the performance of the companies for which they have chief operating
responsibility. The Corporation's one-time charge for its decrease in
staffing levels and other cost reduction programs in 1994 was considered an
extraordinary circumstance that should be excluded in the calculation of
the Corporation's 1994 incentive awards.
In addition to measuring performance against the 1994 quantitative
targets, the Committee evaluated each executive s performance against
qualitative objectives in determining the amount of any incentive awards.
These objectives for each executive officer focus on aspects of the
C o r p o ration s business that directly related to his individual
responsibilities. One-half of the CEO s 1994 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
t o 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
preserving financial strength. Based on this evaluation, the achievement
of the 1994 net income and return on equity objectives and the decision to
increase the awards for 1994 as described above, the CEO received an
incentive award of 82% of his 1994 base salary compared to 44% in 1993.
Stock Options. The long-term component of the Corporation s incentive
compensation program consists of the grant of non-transferable stock
options. The options 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 award each year about 400,000 options, or one-tenth of the total options
available under the 1990 Equity Incentive Plan, and to limit individual
awards to ranges based on a study by outside consultants comparing option
grants to salary levels in general industry. The Committee does not
normally consider the amount of an individual's outstanding or previously
granted options in determining the size of the grant. The 40,000 options
granted to the CEO in 1994 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 increase. In
accordance with the provisions of the 1990 Equity Incentive Plan, the
exercise price of all options granted was equal to the market value of the
underlying Common Stock on the date of grant. Accordingly, the value of
these grants to the officers is dependent solely upon the future growth in
share value of the Corporation s Common Stock.
9<PAGE>
With respect to qualifying compensation paid to executive officers under
Section 162(m) of the Internal Revenue Code, the Corporation does not
e x p e ct to have compensation exceeding the $1-million limitation.
Outstanding stock options granted under the Corporation's 1990 Equity
Incentive Plan will not be subject to the limitation under applicable
regulations, and the Corporation plans to maintain the exclusion for any
additional options that may be granted to employees covered by Section
162(m).
The Compensation Committee expects to complete a comprehensive review of
all the components of the total compensation package of the executive
officers and to report its recommendations to the Board of Directors in the
first half of 1995.
By the Compensation Committee,
James O. Welch, Jr. (Chairman)
Sara L. Baldwin
Henry R. Guild, Jr.
John A. Urquhart
Compensation Committee Interlocks and Insider Participation
Davis Baldwin, Inc., an insurance agency in which Sara L. Baldwin's sons
are executive officers and shareholders, provided insurance services to the
Corporation in 1994 for which it expects to receive up to $440,629 in fees
and commissions. Davis Baldwin, Inc. was formed in 1991 as a result of a
merger between Baldwin and Sons, Inc. and Davis Brothers Insurance. Prior
to that time Davis Brothers Insurance (in which Mrs. Baldwin and her family
had no interest) provided insurance services to the Corporation, and the
combined company continues to do so.
The following tables set forth certain compensation information for the
Chief Executive Officer of the Corporation and each of the four other most
h i g hly compensated executive officers of the Corporation and its
subsidiaries. The share amounts reported below and throughout this proxy
statement have been restated to reflect the two-for-one stock split on
August 30, 1993.
Summary Compensation Table
<TABLE>
Long-Term
Annual Compensation
Compensation Awards
All Other
<CAPTION>
Name and Shares Underlying Compen-
Principal Position Year Salary Bonus Options/SARs(#)(1) sation(2)
<S> <C> <C> <C> <C> <C>
Timothy L. Guzzle 1994 $ 468,750 $ 384,000 40,000 $ 28,703
Chief Executive 1993 443,750 194,000 40,000 28,267
Officer 1992 421,250 176,000 40,000 26,248
Girard F. Anderson 1994 320,461 275,000 24,000 25,076
10<PAGE>
President and Chief Operating 1993 284,750 110,000 24,000 23,290
Officer(3) 1992 258,750 100,000 24,000 21,333
Keith S. Surgenor 1994 215,376 225,000 12,000 13,728
President and Chief 1993 179,500 60,000 12,000 11,986
Operating Officer of 1992 170,500 53,000 12,000 11,175
Tampa Electric Company
and Vice President-Human
Resources (4)
Roger H. Kessel 1994 228,750 150,000 14,000 10,257
Vice President- 1993 219,750 80,000 14,000 10,417
General Counsel 1992 211,250 69,000 14,000 9,770
Alan D. Oak 1994 201,750 130,000 13,000 12,905
Senior Vice President- 1993 192,875 74,000 13,000 12,843
Finance and Treasurer 1992 184,875 68,000 13,000 12,039
</TABLE>
[FN]
(1) Limited stock appreciation rights were awarded in tandem with the
options granted. See note (2) under Option/SAR Grants in Last
Fiscal Year below.
(2) The reported amounts for 1994 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.
(3) Prior to July 19, 1994, Mr. Anderson served as Executive Vice
President-Utility Operations and President of Tampa Electric Company.
(4) On July 19, 1994, Mr. Surgenor was elected President of Tampa
Electric Company.
<TABLE>
Option/SAR Grants in Last Fiscal Year
Individual Grants
<CAPTION>
Number of % of Total
Shares Options/SARs Exercise Grant
Underlying Granted to or Base Date
Options/SARs Employees in Price Expiration Present
Name Granted(#)(1)(2) Fiscal Year Per Share Date Value(3)
<S> <C> <C> <C> <C> <C>
Timothy L. Guzzle 40,000 9.99 $ 19.4375 4/18/04 $137,307
Girard F. Anderson 24,000 5.99 19.4375 4/18/04 82,384
Keith S. Surgenor 12,000 3.00 19.4375 4/18/04 41,192
Roger H. Kessel 14,000 3.50 19.4375 4/18/04 48,057
Alan D. Oak 13,000 3.25 19.4375 4/18/04 44,625
</TABLE>
11<PAGE>
[FN]
(1) The options are exercisable beginning on the date of grant, April 18,
1994.
(2) An equal number of stock appreciation rights which 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
in 1994. 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 Severance Agreements"
below. The exercise of an option or an LSAR results in a
corresponding reduction in the other.
(3) The values shown are based on the Binomial Option Pricing Model (a
variant of the Black-Scholes model) and are stated in current
annualized dollars on a present value basis. The key assumptions
used in the Binomial Option Pricing Model for purposes of this
calculation include the following: (a) a 7% discount rate; (b) a
volatility factor based upon the average trading price for the 40-
month period ending December 31, 1993; (c) a dividend factor based
upon the 5-year average dividend paid for the period ending December
31, 1993; (d) the 10-year option term; and (e) the closing price of
the Corporation's Common Stock on December 31, 1993. The present
value of the options reported has been calculated by multiplying
$19.4375, the share price on the date of grant, by 0.1766, the
Binomial Option Pricing Model ratio, and by the number of shares
underlying the options granted. The actual value an executive may
realize will depend upon the extent to which the stock price exceeds
the exercise price on the date the option is exercised. Accordingly,
the value, if any, realized by an executive will not necessarily be
the value determined by the Binomial Option Pricing Model.
<TABLE>
Aggregated Option/SAR Exercises in Last Fiscal Year and
Fiscal Year-End Option/SAR Value
Number of Value of
Shares Underlying Unexercised
Unexercised In-The-Money
Options/SARs Options/SARs
at Year-End(#) at Year-End
<CAPTION>
Shares Acquired Value Exercisable/ Exercisable/
Name on Exercise(#) Realized($) Unexercisable Unexercisable
<S> <C> <C> <C> <C>
Timothy L. Guzzle 0 0 160,000/0 $ 203,750/0
Girard F. Anderson 0 0 96,000/0 122,250/0
Keith S. Surgenor 0 0 66,000/0 172,375/0
Roger H. Kessel 0 0 120,000/0 454,310/0
Alan D. Oak 0 0 52,000/0 66,219/0
</TABLE>
12<PAGE>
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 Three Years
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 average earnings for the
three years before his retirement 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 9 years of service.
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 (7 years), Mr. Anderson (35 years), Mr. Surgenor (6 years), Mr.
Kessel (5 years) and Mr. Oak (21 years). The pension benefit is computed as
a straight-life annuity commencing at age 62 and is reduced by an officer s
Social Security benefits. 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 age 62, the benefit is based on the officer's service as if his
employment had continued until age 62. 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.
13<PAGE>
Employment and Severance Agreements
The Corporation has severance agreements with 28 officers of the
Corporation and its subsidiaries, including 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 officer
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 the officer for good
reason (as defined) following a change in control, the Corporation will
make a lump sum severance payment to the officer of two times (three times
in certain cases, including the named executive officers) 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 two years (three years in certain cases, including the named
e x e c utive officers) 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.
Any benefit payable to the officer in connection with a change in
control or termination of employment will be reduced to the extent that
such payment, 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 of 1986.
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, Mr. Guzzle's 1994 option
grant provides for a two-year exercise extension period in the event of
such a termination. The Corporation also has an agreement with Mr. Kessel
providing for a minimum base salary of $189,000 and salary continuation
payments for one year in the event of termination by the Corporation
without cause.
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.
14<PAGE>
Based on the Audit Committee s recommendation in April 1994, the Board
reappointed Coopers & Lybrand L.L.P. to serve as independent accountants
and to audit the Corporation s financial statements for 1994. Consistent
with past procedures, independent accountants for the current fiscal year
will be appointed by the Board at its April 1995 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.
COMPLIANCE WITH SECTION 16(a) OF THE SECURITIES EXCHANGE ACT
The Corporation's executive officers and directors are required under
Section 16(a) of the Securities Exchange Act of 1934 to file reports of
ownership and changes in ownership with the Securities and Exchange
Commission and the New York Stock Exchange. Copies of those reports must
also be furnished to the Corporation.
Based solely on a review of the copies of reports furnished to the
Corporation with respect to 1994 and written representations that no other
reports were required, the Corporation believes that the executive officers
and directors of the Corporation have complied in a timely manner with all
applicable Section 16(a) filing requirements except that DuBose Ausley
filed two late reports covering three purchases totaling 1,000 shares and
Henry R. Guild, Jr. filed one late report covering the sale of 1,600
shares.
DEADLINE FOR SHAREHOLDER PROPOSALS
Proposals of shareholders intended to be presented at the 1996 Annual
Meeting of Shareholders must be received on or before November 3, 1995 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
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.
15<PAGE>
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
If other business is properly presented for consideration at the
meeting, such as shareholder proposals which have been excluded pursuant to
the rules under the Securities Exchange Act of 1934, the enclosed proxy
authorizes the persons named therein to vote the shares in their
discretion.
16<PAGE>
TECO Energy, Inc. Appendix A
1995 Annual Meeting
Wednesday April 19, 1995
TECO Plaza
702 North Franklin Street
Tampa, Florida
Attached below is a proxy card for the 1995 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.
Quarterly Reports to Shareholders
We have added a new service in 1995 to provide shareholders with more-
timely information. A toll-free telephone number is now available for
earnings summary information or other company news. The number is (800)
810-2032. Quarterly earnings information will normally be available one or
two business days after the 15th of April, August, October and January.
Starting in 1995, TECO Energy, Inc. will be mailing a mid-year update to
shareholders after the second quarter. This will be mailed with the
d i v i d end checks and dividend reinvestment statements in August.
Shareholders can request 10-Q quarterly reports by calling the TECO Energy
shareholder service number (800) 810-2032. These reports are available 45
days following the end of the first three quarters.<PAGE>
TECO ENERGY, INC. Appendix A
Proxy for Annual Meeting of Shareholders, April 19, 1995
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 17, 1995, 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 19, 1995 at
10:00 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
18<PAGE>
/X/ Please mark votes as in this example. Appendix A
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: G. F. Anderson, T. L. Guzzle, J. T. Touchton and J. A. Urquhart
/ / (A) FOR ALL NOMINEES / / (B) AGAINST ALL NOMINEES
/ / (C)
FOR ALL NOMINEES EXCEPT
PLEASE SIGN AND MAIL THIS PROXY TODAY.
This proxy will be voted as specified, or if no specification is
made, FOR all nominees.
In their discretion, the proxies are also authorized to vote upon
such other matters as may properly come before the meeting.
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.
/ /MARK HERE FOR ADDRESS CHANGE AND NOTE AT LEFT
Signature: ________________________Date_______
Signature: ________________________Date_______
19<PAGE>
