SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
(Mark One)
X QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the quarterly period ended June 30, 1996
OR
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the transition period from to
Commission File Number 1-5007
TAMPA ELECTRIC COMPANY
(Exact name of registrant as specified in its charter)
FLORIDA 59-0475140
(State or other jurisdiction of (IRS Employer
incorporation or organization) Identification No.)
702 North Franklin Street, Tampa, Florida 33602
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (813) 228-4111
Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act
of 1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to
such filing requirements for the past 90 days.
Yes X No
Number of shares outstanding of each of the issuer's classes of common
stock, as of the latest practicable date (July 31, 1996):
Common Stock, Without Par Value 10<PAGE>
FORM 10-Q
PART I. FINANCIAL INFORMATION
Item 1. Financial Statements
In the opinion of management, the unaudited financial statements
include all adjustments (none of which were other than normal or
recurring) necessary to present fairly the results for the three-
month and six-month periods ended June 30, 1996 and 1995.
Reference should be made to the explanatory notes affecting the
income and balance sheet accounts contained in Tampa Electric
Company's Annual Report on Form 10-K for the year ended Dec. 31,
1995 and to the notes on page 7 of this report.
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FORM 10-Q
BALANCE SHEETS
(in thousands)
June 30, Dec. 31,
1996 1995
Assets
Property, plant and equipment,
at original cost
Utility plant in service $2,985,268 $2,930,178
Construction work in progress 518,137 475,260
3,503,405 3,405,438
Accumulated depreciation (1,245,246) (1,203,284)
2,258,159 2,202,154
Other property 1,043 859
2,259,202 2,203,013
Current assets
Cash and cash equivalents 1,409 3,832
Receivables, less allowance
for uncollectibles 117,024 120,273
Inventories, at average cost
Fuel 55,463 69,977
Materials and supplies 40,638 38,657
Prepayments 3,954 3,547
218,488 236,286
Deferred debits
Unamortized debt expense 17,534 18,297
Deferred income taxes 100,535 94,553
Regulatory asset - tax related 42,363 36,931
Other 46,414 50,135
206,846 199,916
$2,684,536 $2,639,215
Liabilities and Capital
Capital
Common stock $ 905,519 $ 851,957
Retained earnings 185,045 188,191
1,090,564 1,040,148
Preferred stock, redemption not required 19,960 54,956
Long-term debt, less amount due
within one year 585,980 583,097
1,696,504 1,678,201
Current liabilities
Long-term debt due within one year 1,045 26,030
Notes payable 168,000 144,500
Accounts payable 101,873 117,430
Revenue refund 25,000 --
Customer deposits 52,713 51,273
Interest accrued 11,117 8,921
Taxes accrued 22,047 16,487
381,795 364,641
Deferred credits
Deferred income taxes 335,878 331,754
Investment tax credits 56,168 58,499
Regulatory liability - tax related 82,538 84,489
Other 131,653 121,631
606,237 596,373
$2,684,536 $2,639,215
The accompanying notes are an integral part of the financial statements.
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FORM 10-Q
STATEMENTS OF INCOME
(in thousands)
For the three months ended June 30, 1996 1995
Operating revenues $272,418 $279,094
Operating expenses
Operation
Fuel 90,838 96,042
Purchased power 12,575 11,669
Other 41,176 40,811
Maintenance 17,043 18,130
Depreciation 29,146 29,539
Taxes, federal and state income 17,415 16,876
Taxes, other than income 21,869 22,464
230,062 235,531
Operating income 42,356 43,563
Other income
Allowance for other funds used
during construction 5,425 2,521
Other income (expense), net 31 (1,095)
5,456 1,426
Income before interest charges 47,812 44,989
Interest charges
Interest on long-term debt 9,754 9,651
Other interest 4,073 2,506
Allowance for borrowed funds
used during construction (2,217) (1,519)
11,610 10,638
Net income 36,202 34,351
Preferred dividend requirements 435 892
Balance applicable to common stock $ 35,767 $ 33,459
The accompanying notes are an integral part of the financial statements.
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FORM 10-Q
STATEMENTS OF INCOME
(in thousands)
For the six months ended June 30, 1996 1995
Operating revenues $527,165 $532,890
Operating expenses
Operation
Fuel 187,130 186,418
Purchased power 22,131 21,189
Other 80,591 80,143
Maintenance 31,555 34,960
Depreciation 58,064 58,883
Taxes, federal and state income 28,678 28,493
Taxes, other than income 44,455 44,978
452,604 455,064
Operating income 74,561 77,826
Other income
Allowance for other funds used
during construction 10,444 4,320
Other income (expense), net (84) (1,752)
10,360 2,568
Income before interest charges 84,921 80,394
Interest charges
Interest on long-term debt 19,625 19,033
Other interest 7,388 4,733
Allowance for borrowed funds
used during construction (4,268) (2,603)
22,745 21,163
Net income 62,176 59,231
Preferred dividend requirements 1,327 1,784
Balance applicable to common stock $ 60,849 $ 57,447
The accompanying notes are an integral part of the financial statements.
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FORM 10-Q
STATEMENTS OF CASH FLOWS
(in thousands)
For the six months ended June 30, 1996 1995
Cash flows from operating activities
Net income $ 62,176 $ 59,231
Adjustments to reconcile net income
to net cash:
Depreciation 58,064 58,883
Deferred income taxes (9,242) (6,749)
Investment tax credits, net (2,331) (2,383)
Allowance for funds used
during construction (14,712) (6,923)
Deferred recovery clause 1,296 (13,205)
Revenue reduction 29,928 16,822
Amortization of coal contract buyout 1,352 676
Receivables, less allowance
for uncollectibles 3,249 (8,907)
Fuel inventories 14,514 18,940
Taxes accrued 5,560 36,851
Accounts payable (15,557) (32,118)
Other 9,253 12,212
143,550 133,330
Cash flows from investing activities
Capital expenditures (115,207) (175,372)
Allowance for funds used
during construction 14,712 6,923
(100,495) (168,449)
Cash flows from financing activities
Proceeds from contributed capital
from parent 53,000 51,000
Proceeds from long-term debt 3,058 620
Repayment of long-term debt (25,280) (260)
Net increase in short-term debt 23,500 21,200
Dividends (64,260) (44,255)
Redemption of preferred stock,
including premium (35,496) --
(45,478) 28,305
Net decrease in cash and cash equivalents (2,423) (6,814)
Cash and cash equivalents
at beginning of period 3,832 7,071
Cash and cash equivalents at end of period $ 1,409 $ 257
The accompanying notes are an integral part of the financial statements.
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FORM 10-Q
NOTES TO FINANCIAL STATEMENTS
A. Tampa Electric Company is a wholly-owned subsidiary of
TECO Energy, Inc.
B. The company has made certain commitments in connection with its
continuing construction program. Total construction expenditures are
estimated to be $179 million for 1996, excluding allowance for funds
used during construction (AFUDC).
C. During the first half of 1996, the company recognized $30-million
of revenue deferrals and refunds pursuant to a multi-year base rate
freeze, revenue deferral and refund plan (the 1996 Plan) which the
Florida Public Service Commission (FPSC) approved in a final order on
May 20, 1996. The company deferred $17 million during the first six
months last year in accordance with another plan (the 1995 Plan)
approved by the FPSC for 1995. A total of $81 million of revenues has
been recorded on the balance sheet under the plans in 1995 and 1996,
of which $56 million is included in other deferred credits and $25
million is classified in revenue refund to reflect the refund to
customers beginning Oct. 1, 1996.
D. On April 29, 1996, the company retired $35 million aggregate par
value of 8.00% Series E and 7.44% Series F preferred stock at
redemption prices of $102.00 and $101.00 per share, respectively.
E. Certain 1995 amounts on the statements of cash flows have been
restated to comply with the current year presentations.
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FORM 10-Q
Item 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations
Results of Operations
Three months ended June 30, 1996:
Net income of $36.2 million in the second quarter was $1.9
million or 5 percent higher than in 1995's second quarter due to
higher capitalized financing costs (AFUDC) and lower operating
expenses. Both the 1996 and 1995 results were net of $9-million of
revenue deferrals in accordance with FPSC-approved plans. Operating
income was 3 percent lower than 1995 reflecting lower revenues.
Revenues for the quarter decreased 2 percent due to lower fuel
charges to the customer and the elimination of the oil backout
recovery clause as part of the 1995 Plan. In the absence of this
elimination, the oil backout recovery clause would have contributed
$3 million in revenues for the quarter.
Retail energy sales were essentially unchanged. Energy sales in
1996 were favorably affected by customer growth of 2 percent while
warmer weather favorably affected energy sales in 1995.
Combined fuel and purchased power expense decreased 4 percent for
the second quarter due to effective coal contract administration which
resulted in lower per-unit fuel costs.
Operation-other and maintenance expenses decreased slightly
primarily due to continued cost control efforts throughout the
company.
The effective income tax rate for the second quarter was
32.5 percent compared to 34.1 percent for the same period last year.
The decrease was primarily attributable to higher allowance for other
funds used during construction in 1996.
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FORM 10-Q
Total AFUDC increased to $8 million from $4 million in 1995 with
additional investment in the company s Polk Power Station, which is
scheduled for commercial operation in the fourth quarter of 1996.
Interest expense before the allowance for borrowed funds used
during construction was 14 percent higher in the current quarter
reflecting higher levels of short-term debt, interest on the revenue
deferrals and the effect of the expiration of an interest rate swap
agreement.
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FORM 10-Q
Six months ended June 30, 1996:
Net income of $62.2 million in the first half of 1996 was
$2.9 million or 5 percent higher than in 1995's first half due to
higher AFUDC, increased energy sales and lower operating expenses.
Operating income was 4 percent lower than 1995 reflecting $30-million
of revenue deferrals and refunds in accordance with the 1996 Plan.
Operating income last year was net of a $17-million revenue deferral
in accordance with the 1995 Plan.
Revenues in the first half decreased from 1995 because the 1996
revenue deferrals and refunds were higher than the 1995 revenue
deferrals. Increased base revenues from 4 percent higher retail
energy sales reflecting favorable weather, customer growth of more
than 2 percent and a strong local economy were offset by lower fuel
charges to the customer and the elimination of the oil backout
recovery clause. In the absence of this elimination, the oil backout
clause would have contributed $6 million in revenues for the first
half of 1996.
Total operating expenses for the first half of 1996 were
essentially unchanged from 1995. Non-fuel operations and maintenance
expenses, down 3 percent as a result of continued cost control efforts
throughout the company, were offset by higher combined fuel and
purchased power expenses from increased energy sales.
The effective income tax rate for the first six months of 1996
was 31.5 percent compared to 33.7 percent for the same period last
year. The decrease is primarily attributable to higher allowance for
other funds used during construction in 1996.
Total AFUDC increased in 1996 to $15 million from $7 million in
1995 with additional investment in the company s Polk Power Station,
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FORM 10-Q
which is scheduled for commercial operation in the fourth quarter of
1996.
Interest expense before the allowance for borrowed funds used
during construction was 14 percent higher in the first half of the
year reflecting higher levels of short-term debt, interest on the
revenue deferrals and refunds and the effect of the expiration of an
interest rate swap agreement.
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FORM 10-Q
Liquidity, Capital Resources and Changes in Financial Condition
The FPSC issued a final order approving a multi-year base rate
freeze, revenue deferral and refund plan on May 20, 1996. The plan is
set forth in an agreement among the company, the Office of Public
Counsel and the Florida Industrial Power Users Group covering the
years 1996 through 1998. A more complete description of the plan is
contained in the company s Annual Report on Form 10-K for the year
ended Dec. 31, 1995.
As contemplated by the 1996 Plan, the FPSC hearings concerning
the regulatory treatment of the investment and expenses associated
with the company s Polk Power Station were held on July 17 and 18.
The FPSC staff recommendation on the issues is due September 19 and a
FPSC decision is expected October 1.
Fuel inventory declined from Dec. 31, 1995 due to increased
energy sales and effective management of coal contracts and inventory
levels.
The increase in other deferred credits primarily reflected the
revenue deferrals related to the 1996 Plan and the 1995 Plan.
The $25-million balance in the revenue refund account provides
for the refund to customers to be made over the 12-month period
beginning Oct. 1, 1996 under the 1996 Plan and consists of $15 million
from 1996's revenues and $10 million of revenues deferred in 1995.
The increase in notes payable was related to the Polk Unit One
construction program as well as funding of the retirement of $25
million of long-term debt that matured.
The decrease in preferred stock reflected the company s
redemption of $35 million aggregate par value of preferred stock in
1996. (See Note D on page 7)
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FORM 10-Q
PART II. OTHER INFORMATION
Item 6. Exhibits and Reports on Form 8-K
(a) Exhibits
10.1 Form of Nonstatutory Stock Option under the TECO Energy, Inc.
1996 Equity Incentive Plan.
10.2 Form of Restricted Stock Agreement between TECO Energy, Inc.
and certain senior executives under the TECO Energy, Inc. 1996
Equity Incentive Plan.
10.3 Form of Restricted Stock Agreement between TECO Energy, Inc.
and G.F. Anderson under the TECO Energy, Inc. 1996 Equity
Incentive Plan.
12. Ratio of earnings to fixed charges.
27. Financial data schedule. (EDGAR filing only)
(b) Reports on Form 8-K
The registrant filed a Current Report on Form 8-K dated May 20,
1996 reporting under "Item 5. Other Events" on the FPSC order
approving the agreement among the registrant, the Office of
Public Counsel and the Florida Industrial Power Users Group
providing for a multi-year base rate freeze, revenue deferral
and refund plan for the company.
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FORM 10-Q
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934,
the registrant has duly caused this report to be signed on its behalf by
the undersigned thereunto duly authorized.
TAMPA ELECTRIC COMPANY
(Registrant)
Dated: August 13, 1996 By: /s/ W. L. Griffin
W. L. Griffin
Vice President - Controller
(Principal Accounting Officer)
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FORM 10-Q
INDEX TO EXHIBITS
Exhibit No. Description of Exhibits Page No.
10.1 Form of Nonstatutory Stock Option under the
TECO Energy, Inc. 1996 Equity Incentive Plan 16
10.2 Form of Restricted Stock Agreement between
TECO Energy, Inc. and certain senior executives under
the TECO Energy, Inc. 1996 Equity Incentive Plan 21
10.3 Form of Restricted Stock Agreement between
TECO Energy, Inc. and G.F. Anderson under the
TECO Energy, Inc. 1996 Equity Incentive Plan 25
12. Ratio of earnings to fixed charges 29
27. Financial data schedule (EDGAR filing only) --
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Exhibit 10.1
TECO ENERGY, INC.
1996 EQUITY INCENTIVE PLAN
Nonstatutory Stock Option
TECO Energy, Inc. (the "Company") grants to ___________________________
(the "Optionee") a nonstatutory stock option and limited stock appreciation
rights (the "Option") dated __________________, 199___ under the Company's
1996 Equity Incentive Plan (the "Plan"). Capitalized terms not otherwise
defined herein have the meanings given to them in the Plan.
1. Grant of Stock Option. Pursuant to the Plan and subject to the
terms and conditions set forth in this Option, the Company hereby grants to
the Optionee the right and option to purchase from the Company ________ shares
of Common Stock at a price of $_____ per share. This Option may be exercised
in whole or in part with respect to a number of whole shares, at any time and
from time to time after the date hereof and prior to the expiration of ten
years from the date hereof (the "Expiration Date"), except as otherwise
provided herein.
This Option will not be treated as an incentive stock option under
Section 422 of the Internal Revenue Code of 1986, as amended.
2. Exercise and Payment. To exercise this Option, the Optionee will
deliver written notice to the Secretary of the Company specifying the date of
this Option, the number of shares as to which this Option is being exercised,
and a date not later than thirty days after the date of delivery of the notice
when the Optionee will take up and pay for such shares. On the date specified
in such notice, the Company will deliver to the Optionee one or more
certificates for the number of shares purchased against payment therefor in
cash or by certified check or in such other form as the Committee may approve.
3. Limited Stock Appreciation Rights. The Company grants to the Op-
tionee a limited stock appreciation right (a "Limited Right") with respect to
each share subject to an option to purchase hereunder (the "Related Option").
Upon exercise of a Limited Right, the Related Option will terminate, and upon
exercise of a Related Option, the corresponding Limited Right will terminate.
Limited Rights will be exercisable to the same extent and upon the same terms
as the Related Options, except that a Limited Right may be exercised only
during a 90-day period beginning on the first day following a Change in
Control, as defined below, and if the Optionee is a Reporting Person, no
Limited Right may be exercised within six months after the date hereof.
Upon exercise of a Limited Right, the Optionee will be entitled to
receive a cash payment equal to the excess of (i) the highest per share price
paid for shares of Common Stock in the transaction constituting a Change in
Control as described in subsections (a), (c) or (d) below, or in the case of a
Change in Control described in subsection (b) below which does not occur in
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Exhibit 10.1
connection with such a transaction, the average trading price of shares of
Common Stock on the New York Stock Exchange, such other national securities
exchange on which such shares are admitted to trade or the National Associa-
tion of Securities Dealers Automated Quotation System, during the thirty-day
period ending on the date immediately preceding the Change of Control over
(ii) the exercise price per share of the Related Option.
For purposes of this Option, a "Change in Control" means a change in
control of the Company of a nature that would be required to be reported in
response to Item 6(e) of Schedule 14A of Regulation 14A promulgated under the
Securities Exchange Act of 1934, as amended (the "Exchange Act"), whether or
not the Company is in fact required to comply therewith; provided, that,
without limitation, such a Change in Control shall be deemed to have occurred
if:
(a) any "person" (as such term is used in Sections 13(d) and
14(d) of the Exchange Act), other than the Company, any trustee or other
fiduciary holding securities under an employee benefit plan of the Company or
a corporation owned directly or indirectly by the shareholders of the Company
in substantially the same proportions as their ownership of stock of the
Company, is or becomes the "beneficial owner" (as defined in Rule 13d-3 under
the Exchange Act) directly or indirectly of securities of the Company
representing 30% or more of the combined voting power of the Company's then
outstanding securities;
(b) during any period of twenty-four (24) consecutive months
(not including any period prior to the date of this Option), individuals who
at the beginning of such period constitute the Board of Directors of the
Company and any new director (other than a director designated by a person who
has entered into an agreement with the Company to effect a transaction
described in subsections (a), (c) or (d) of this Section 3) whose election by
the Board of Directors of the Company or nomination for election by the
shareholders of the Company was approved by a vote of at least two-thirds
(2/3) of the directors then still in office who either were directors at the
beginning of such period or whose election or nomination for election was
previously so approved cease for any reason to constitute a majority thereof;
(c) the shareholders of the Company approve a merger or
consolidation of the Company with any other corporation other than (i) a
merger or consolidation which would result in the voting securities of the
Company outstanding immediately prior thereto continuing to represent (either
by remaining outstanding or by being converted into voting securities of the
surviving entity) at least 50% of the combined voting securities of the
Company or such surviving entity outstanding immediately after such merger or
consolidation or (ii) a merger or consolidation effected to implement a
recapitalization of the Company (or similar transaction) in which no "person"
(as defined above) acquires 30% or more of the combined voting power of the
Company's then outstanding securities; or
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Exhibit 10.1
(d) the shareholders of the Company approve a plan of complete
liquidation of the Company or an agreement for the sale or disposition by the
Company of all or substantially all of the Company's assets.
4. Termination of Employment. If the Optionee's employment with the
Company or any business entity in which the Company owns directly or
indirectly 50% or more of the total voting power or has a significant
financial interest as determined by the Committee (an "Affiliate") terminates
for any reason (a "Termination of Employment"), this Option will be
exercisable for the longest applicable period provided below. This Option
will terminate, and no rights will be exercisable hereunder, after the
expiration of the applicable exercise period.
(a) The Optionee may exercise the rights available under this
Option at the time of Termination of Employment for a period of three months
thereafter, but in no event after the Expiration Date.
(b) If Termination of Employment occurs because of disability,
the Optionee or the Optionee's guardian or legal representative may exercise
the rights available under this Option at the time of Termination of
Employment at any time on or before the later of (i) twelve months after the
Termination of Employment or (ii) the Expiration Date. The Committee will
determine whether and when Termination of Employment because of disability has
occurred for purposes of this Option.
(c) If Termination of Employment occurs for any reason on or
after the age at which benefits are payable to the Optionee without reduction
for commencement of such benefits before normal retirement age under the TECO
Energy Group Retirement Plan (or any successor thereto), or any earlier age
that the Committee determines will constitute a normal retirement for purposes
of this Option, the Optionee (or the Optionee's guardian or legal
representative or, after death, the Optionee's Designated Beneficiary under
the Plan or, if none has been designated, those entitled to do so by the
Optionee's will or the laws of descent and distribution) may exercise the
rights available under this Option at the time of Termination of Employment at
any time on or before the Expiration Date.
(d) Upon the death of the Optionee at any time while this Option
is exercisable, the Optionee's Designated Beneficiary under the Plan or, if
none has been designated, those entitled to do so by the Optionee's will or
the laws of descent and distribution, may exercise the rights available under
this Option at the time of death for a period of twelve months thereafter or,
if Termination of Employment occurs because of death, at any time on or before
the later of (i) twelve months after the date of death or (ii) the Expiration
Date.
The Committee will determine whether an authorized leave of absence
constitutes Termination of Employment for purposes of this Option.
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Exhibit 10.1
5. Adjustment of Terms. In the event of corporate transactions
affecting the Company's outstanding Common Stock, the Committee will equitably
adjust the number and kind of shares subject to this Option and the exercise
price hereunder to the extent provided by the Plan.
6. No Transfer. This Option will not be transferable other than by
will or the laws of descent and distribution and will be exercisable during
the Optionee's lifetime only by the Optionee or the Optionee's guardian or
legal representative.
7. Securities Laws. The purchase of any shares by the Optionee upon
exercise of this Option will be subject to the conditions that (i) the Company
may in its discretion require that a registration statement under the
Securities Act of 1933 with respect to the sale of such shares to the Optionee
will be in effect, and such shares will be duly listed, subject to notice of
issuance, on any securities exchange on which the Common Stock may then be
listed, (ii) all such other action as the Company considers necessary to
comply with any law, rule or regulation applicable to the sale of such shares
to the Optionee will have been taken and (iii) the Optionee will have made
such representations and agreements as the Company may require to comply with
applicable law.
8. Withholding Taxes. The Optionee will pay to the Company, or make
provision satisfactory to the Committee for payment of, any taxes required by
law to be withheld in respect of the exercise of the Option or Limited Right
no later than the date of the event creating the tax liability. In the
Committee's discretion, such tax obligations may be paid in whole or in part
in shares of Common Stock, including shares retained from the exercise of this
Option, valued at fair market value on the date of delivery. The Company and
its Affiliates may, to the extent permitted by law, deduct any such tax
obligations from any payment of any kind otherwise due to the Optionee.
9. The Committee. Any determination by the Committee under, or
interpretation of the terms of, this Option or the Plan will be final and
binding on the Optionee.
10. Limitation of Rights. The Optionee will have no rights as a
shareholder with respect to any shares subject to this Option until such
shares are issued and delivered against payment therefor. The Optionee will
have no right to continued employment by virtue of this Option.
11. Amendment. The Company may amend, modify or terminate this
Option, including substituting another Award of the same or a different type
and changing the date of realization, provided that the Grantee's consent to
such action will be required unless the action, taking into account any
related action, would not adversely affect the Grantee.
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Exhibit 10.1
11. Governing Law. This Option will be governed by and interpreted in
accordance with the laws of Florida.
TECO ENERGY, INC.
By ______________________
Title
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Exhibit 10.2
TECO ENERGY, INC.
1996 EQUITY INCENTIVE PLAN
Restricted Stock Agreement
TECO Energy, Inc. (the "Company") and Restricted Optionee
(the "Grantee") have entered into this Restricted Stock Agreement (the
"Agreement") dated April 18, 1996 under the Company's 1996 Equity Incentive
Plan (the "Plan"). Capitalized terms not otherwise defined herein have the
meanings given to them in the Plan.
1. Grant of Restricted Stock. Pursuant to the Plan and subject to
the terms and conditions set forth in this Agreement, the Company hereby
grants, issues and delivers to the Grantee Number of
Restricted Shares shares of its Common Stock (the "Restricted Stock").
2. Restrictions on Stock. Until the restrictions terminate under
Section 3, unless otherwise determined by the Committee:
(a) the Restricted Stock may not be sold, assigned, pledged or
transferred by the Grantee; and
(b) all shares of Restricted Stock will be forfeited and
returned to the Company if the Grantee ceases to be an employee of the Company
or any business entity in which the Company owns directly or indirectly 50% or
more of the total voting power or has a significant financial interest as
determined by the Committee (an "Affiliate").
3. Termination of Restrictions. The restrictions on all shares of
Restricted Stock will terminate on the earliest to occur of the following
events:
(a) the Grantee's death;
(b) the termination of Grantee's employment with the Company or
any Affiliate because of a disability that would entitle the Grantee to
benefits under the long-term disability benefits program of the Company for
which the Grantee is eligible, as determined by the Committee;
(c) the termination by the Company or any Affiliate of Grantee's
employment other than for Cause as determined by the Committee. "Cause" means
(i) willful and continued failure of the Grantee to substantially perform his
duties with the Company or such Affiliate (other than by reason of physical or
mental illness) after written demand specifically identifying such failure is
given to the Grantee by the Company, or (ii) willful conduct by the Grantee
that is demonstrably and materially injurious to the Company. For purposes of
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Exhibit 10.2
this subsection, "willful" conduct requires an act, or failure to act, that is
not in good faith and that is without reasonable belief that the action or
omission was in the best interest of the Company or the Affiliate;
(d) the Grantee's attainment of the age at which benefits are
payable under the TECO Energy Group Retirement Plan or any successor thereto
without reduction for commencement of benefits before normal retirement age,
or any earlier date that the Committee determines will constitute a normal
retirement for purposes of this Agreement; or
(e) upon a Change in Control. For purposes of this Agreement, a
"Change in Control" means a change in control of the Company of a nature that
would be required to be reported in response to Item 6(e) of Schedule 14A of
Regulation 14A promulgated under the Securities Exchange Act of 1934, as
amended (the "Exchange Act"), whether or not the Company is in fact required
to comply therewith; provided, that, without limitation, such a Change in
Control shall be deemed to have occurred if:
(1) any "person" (as such term is used in Sections 13(d)
and 14(d) of the Exchange Act), other than the Company, any trustee or
other fiduciary holding securities under an employee benefit plan of the
Company or a corporation owned, directly or indirectly, by the
shareholders of the Company in substantially the same proportions as
their ownership of stock of the Company is or becomes the "beneficial
owner" (as defined in Rule 13d-3 under the Exchange Act), directly or
indirectly, of securities of the Company representing 30% or more of the
combined voting power of the Company's then outstanding securities;
(2) during any period of twenty-four (24) consecutive
months (not including any period prior to the date of this Agreement),
individuals who at the beginning of such period constitute the Board of
Directors of the Company and any new director (other than a director
designated by a person who has entered into an agreement with the
Company to effect a transaction described in subsections (1), (3) or (4)
of this Section 3(e)) whose election by the Board of Directors of the
Company or nomination for election by the shareholders of the Company
was approved by a vote of at least two-thirds (2/3) of the directors
then still in office who either were directors at the beginning of such
period or whose election or nomination for election was previously so
approved, cease for any reason to constitute a majority thereof;
(3) the shareholders of the Company approve a merger or
consolidation of the Company with any other corporation, other than (i)
a merger or consolidation which would result in the voting securities of
the Company outstanding immediately prior thereto continuing to
represent (either by remaining outstanding or by being converted into
voting securities of the surviving entity) at least 50% of the combined
voting securities of the Company or such surviving entity outstanding
immediately after such merger or consolidation or (ii) a merger or
consolidation effected to implement a recapitalization of the Company
- 22 -<PAGE>
Exhibit 10.2
(or similar transaction) in which no "person" (as defined above)
acquires 30% or more of the combined voting power of the Company's then
outstanding securities; or
(4) the shareholders of the Company approve a plan of
complete liquidation of the Company or an agreement for the sale or
disposition by the Company of all or substantially all of the Company's
assets.
4. Rights as Shareholder. Subject to the restrictions and other
limitations and conditions provided in this Agreement, the Grantee as owner of
the Restricted Stock will have all the rights of a shareholder, including but
not limited to the right to receive all dividends paid on, and the right to
vote, such Restricted Stock.
5. Stock Certificates. Each certificate issued for shares of
Restricted Stock will be registered in the name of the Grantee and deposited
by the Grantee, together with a stock power endorsed in blank, with the
Company and will bear a legend in substantially the following form:
THE TRANSFERABILITY OF THIS CERTIFICATE AND THE SHARES OF STOCK
REPRESENTED HEREBY ARE SUBJECT TO THE TERMS, CONDITIONS AND
RESTRICTIONS (INCLUDING RESTRICTIONS ON TRANSFER AND FORFEITURE
PROVISIONS) CONTAINED IN AN AGREEMENT BETWEEN THE REGISTERED OWNER
AND TECO ENERGY, INC. A COPY OF SUCH AGREEMENT WILL BE FURNISHED
TO THE HOLDER OF THIS CERTIFICATE UPON WRITTEN REQUEST AND WITHOUT
CHARGE.
Upon the termination of the restrictions imposed under this Agreement as
to any shares of Restricted Stock deposited with the Company hereunder, the
Company will return to the Grantee (or to such Grantee's legal representative,
beneficiary or heir) certificates, without such legend, for such shares.
6. Notice of Election Under Section 83(b). If the Grantee makes an
election under Section 83(b) of the Internal Revenue Code of 1986, as amended,
he will provide a copy thereof to the Company within thirty days of the filing
of such election with the Internal Revenue Service.
7. Withholding Taxes. The Grantee will pay to the Company, or make
provision satisfactory to the Committee for payment of, any taxes required by
law to be withheld in respect of the Restricted Stock no later than the date
of the event creating the tax liability. In the Committee's discretion, such
tax obligations may be paid in whole or in part in shares of Common Stock,
including the Restricted Stock, valued at fair market value on the date of
delivery. The Company and its Affiliates may, to the extent permitted by law,
deduct any such tax obligations from any payment of any kind otherwise due to
the Grantee.
- 23 -<PAGE>
Exhibit 10.2
8. The Committee. Any determination by the Committee under, or
interpretation of the terms of, this Agreement or the Plan will be final and
binding on the Grantee.
9. Limitation of Rights. The Grantee will have no right to continued
employment by virtue of this grant of Restricted Stock.
10. Amendment. The Company may amend, modify or terminate this
Agreement, including substituting another Award of the same or a different
type and changing the date of realization, provided that the Grantee's consent
to such action will be required unless the action, taking into account any
related action, would not adversely affect the Grantee.
11. Governing Law. This Agreement will be governed by and interpreted
in accordance with the laws of Florida.
TECO ENERGY, INC.
By: ______________________
Title:
_________________________
Signature of Grantee
- 24 -<PAGE>
Exhibit 10.3
TECO ENERGY, INC.
1996 EQUITY INCENTIVE PLAN
Restricted Stock Agreement
TECO Energy, Inc. (the "Company") and _______________________ (the
"Grantee") have entered into this Restricted Stock Agreement (the "Agreement")
dated April 17, 1996 under the Company's 1996 Equity Incentive Plan (the
"Plan"). Capitalized terms not otherwise defined herein have the meanings
given to them in the Plan.
1. Grant of Restricted Stock. Pursuant to the Plan and subject to
the terms and conditions set forth in this Agreement, the Company hereby
grants, issues and delivers to the Grantee _________ shares of its Common
Stock (the "Restricted Stock").
2. Restrictions on Stock. Until the restrictions terminate under
Section 3, unless otherwise determined by the Committee:
(a) the Restricted Stock may not be sold, assigned, pledged or
transferred by the Grantee; and
(b) all shares of Restricted Stock will be forfeited and
returned to the Company if the Grantee ceases to be an employee of the Company
or any business entity in which the Company owns directly or indirectly 50% or
more of the total voting power or has a significant financial interest as
determined by the Committee (an "Affiliate").
3. Termination of Restrictions. The restrictions on all shares of
Restricted Stock will terminate on the earliest to occur of the following
events:
(a) the Grantee's death;
(b) the termination of Grantee's employment with the Company or
any Affiliate because of a disability that would entitle the Grantee to
benefits under the long-term disability benefits program of the Company for
which the Grantee is eligible, as determined by the Committee;
(c) the termination by the Company or any Affiliate of Grantee's
employment other than for Cause as determined by the Committee. "Cause" means
(i) willful and continued failure of the Grantee to substantially perform his
duties with the Company or such Affiliate (other than by reason of physical or
mental illness) after written demand specifically identifying such failure is
given to the Grantee by the Company, or (ii) willful conduct by the Grantee
that is demonstrably and materially injurious to the Company. For purposes of
- 25 -<PAGE>
Exhibit 10.3
this subsection, "willful" conduct requires an act, or failure to act, that is
not in good faith and that is without reasonable belief that the action or
omission was in the best interest of the Company or the Affiliate;
(d) the Grantee's attainment of the age of 65; or
(e) upon a Change in Control. For purposes of this Agreement, a
"Change in Control" means a change in control of the Company of a nature that
would be required to be reported in response to Item 6(e) of Schedule 14A of
Regulation 14A promulgated under the Securities Exchange Act of 1934, as
amended (the "Exchange Act"), whether or not the Company is in fact required
to comply therewith; provided, that, without limitation, such a Change in
Control shall be deemed to have occurred if:
(1) any "person" (as such term is used in Sections 13(d)
and 14(d) of the Exchange Act), other than the Company, any trustee or
other fiduciary holding securities under an employee benefit plan of the
Company or a corporation owned, directly or indirectly, by the
shareholders of the Company in substantially the same proportions as
their ownership of stock of the Company is or becomes the "beneficial
owner" (as defined in Rule 13d-3 under the Exchange Act), directly or
indirectly, of securities of the Company representing 30% or more of the
combined voting power of the Company's then outstanding securities;
(2) during any period of twenty-four (24) consecutive
months (not including any period prior to the date of this Agreement),
individuals who at the beginning of such period constitute the Board of
Directors of the Company and any new director (other than a director
designated by a person who has entered into an agreement with the
Company to effect a transaction described in subsections (1), (3) or (4)
of this Section 3(e)) whose election by the Board of Directors of the
Company or nomination for election by the shareholders of the Company
was approved by a vote of at least two-thirds (2/3) of the directors
then still in office who either were directors at the beginning of such
period or whose election or nomination for election was previously so
approved, cease for any reason to constitute a majority thereof;
(3) the shareholders of the Company approve a merger or
consolidation of the Company with any other corporation, other than (i)
a merger or consolidation which would result in the voting securities of
the Company outstanding immediately prior thereto continuing to
represent (either by remaining outstanding or by being converted into
voting securities of the surviving entity) at least 50% of the combined
voting securities of the Company or such surviving entity outstanding
immediately after such merger or consolidation or (ii) a merger or
consolidation effected to implement a recapitalization of the Company
(or similar transaction) in which no "person" (as defined above)
acquires 30% or more of the combined voting power of the Company's then
outstanding securities; or
- 26 -<PAGE>
Exhibit 10.3
(4) the shareholders of the Company approve a plan of
complete liquidation of the Company or an agreement for the sale or
disposition by the Company of all or substantially all of the Company's
assets.
4. Rights as Shareholder. Subject to the restrictions and other
limitations and conditions provided in this Agreement, the Grantee as owner of
the Restricted Stock will have all the rights of a shareholder, including but
not limited to the right to receive all dividends paid on, and the right to
vote, such Restricted Stock.
5. Stock Certificates. Each certificate issued for shares of
Restricted Stock will be registered in the name of the Grantee and deposited
by the Grantee, together with a stock power endorsed in blank, with the
Company and will bear a legend in substantially the following form:
THE TRANSFERABILITY OF THIS CERTIFICATE AND THE SHARES OF STOCK
REPRESENTED HEREBY ARE SUBJECT TO THE TERMS, CONDITIONS AND
RESTRICTIONS (INCLUDING RESTRICTIONS ON TRANSFER AND FORFEITURE
PROVISIONS) CONTAINED IN AN AGREEMENT BETWEEN THE REGISTERED OWNER
AND TECO ENERGY, INC. A COPY OF SUCH AGREEMENT WILL BE FURNISHED
TO THE HOLDER OF THIS CERTIFICATE UPON WRITTEN REQUEST AND WITHOUT
CHARGE.
Upon the termination of the restrictions imposed under this Agreement as
to any shares of Restricted Stock deposited with the Company hereunder, the
Company will return to the Grantee (or to such Grantee's legal representative,
beneficiary or heir) certificates, without such legend, for such shares.
6. Notice of Election Under Section 83(b). If the Grantee makes an
election under Section 83(b) of the Internal Revenue Code of 1986, as amended,
he will provide a copy thereof to the Company within thirty days of the filing
of such election with the Internal Revenue Service.
7. Withholding Taxes. The Grantee will pay to the Company, or make
provision satisfactory to the Committee for payment of, any taxes required by
law to be withheld in respect of the Restricted Stock no later than the date
of the event creating the tax liability. In the Committee's discretion, such
tax obligations may be paid in whole or in part in shares of Common Stock,
including the Restricted Stock, valued at fair market value on the date of
delivery. The Company and its Affiliates may, to the extent permitted by law,
deduct any such tax obligations from any payment of any kind otherwise due to
the Grantee.
8. The Committee. Any determination by the Committee under, or
interpretation of the terms of, this Agreement or the Plan will be final and
binding on the Grantee.
9. Limitation of Rights. The Grantee will have no right to continued
employment by virtue of this grant of Restricted Stock.
- 27 -<PAGE>
Exhibit 10.3
10. Amendment. The Company may amend, modify or terminate this
Agreement, including substituting another Award of the same or a different
type and changing the date of realization, provided that the Grantee's consent
to such action will be required unless the action, taking into account any
related action, would not adversely affect the Grantee.
11. Governing Law. This Agreement will be governed by and interpreted
in accordance with the laws of Florida.
TECO ENERGY, INC.
By: ______________________
Title:
_________________________
Signature of Grantee
- 28 -<PAGE>
FORM 10-Q
Exhibit 12
TAMPA ELECTRIC COMPANY
RATIO OF EARNINGS TO FIXED CHARGES
The following table sets forth the company's ratio of earnings to fixed
charges for the periods indicated.
Six Months Twelve Months
Ended Ended Year Ended December 31,
(1) (2)
June 30, 1996 June 30, 1996 1995 1994 1993 1992 1991
4.00x 4.41x 4.50x 4.11x 3.98x 4.16x 3.66x
For the purposes of calculating this ratio, earnings consist of income
before income taxes and fixed charges. Fixed charges consist of
interest on indebtedness, amortization of debt premium, the interest
component of rentals and preferred stock dividend requirements.
(1) Includes the effect of a $21.3-million pretax restructuring charge. The
effect of this charge was to reduce the ratio of earnings to fixed
charges. Had this non-recurring charge been excluded from the
calculation, the ratio of earnings to fixed charges would have been
4.52x for the period ended Dec. 31, 1994.
(2) Includes the effect of the non-recurring $10-million pretax charge
associated with a coal pricing settlement. The effect of this
charge was to reduce the ratio of earnings to fixed charges. Had
this non-recurring charge been excluded from the calculation, the ratio
of earnings to fixed charges would have been 4.17x for the year ended
Dec. 31, 1993.
- 29 -<PAGE>
<TABLE> <S> <C>
<ARTICLE> UT
<LEGEND>
THE SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE
TAMPA ELECTRIC COMPANY BALANCE SHEETS, STATEMENTS OF INCOME AND STATEMENTS
OF CASH FLOWS AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH
FINANCIAL STATEMENTS.
</LEGEND>
<CIK> 0000096271
<NAME> Tampa Electric Company
<MULTIPLIER> 1000
<S> <C>
<FISCAL-YEAR-END> DEC-31-1996
<PERIOD-START> JAN-1-1996
<PERIOD-END> JUN-30-1996
<PERIOD-TYPE> 6-MOS
<BOOK-VALUE> PER-BOOK
<TOTAL-NET-UTILITY-PLANT> 2,258,159
<OTHER-PROPERTY-AND-INVEST> 1,043
<TOTAL-CURRENT-ASSETS> 218,488
<TOTAL-DEFERRED-CHARGES> 206,846
<OTHER-ASSETS> 0
<TOTAL-ASSETS> 2,684,536
<COMMON> 118,921
<CAPITAL-SURPLUS-PAID-IN> 786,598
<RETAINED-EARNINGS> 185,045
<TOTAL-COMMON-STOCKHOLDERS-EQ> 1,090,564
0
19,960
<LONG-TERM-DEBT-NET> 585,980
<SHORT-TERM-NOTES> 0
<LONG-TERM-NOTES-PAYABLE> 0
<COMMERCIAL-PAPER-OBLIGATIONS> 168,000
<LONG-TERM-DEBT-CURRENT-PORT> 1,045
0
<CAPITAL-LEASE-OBLIGATIONS> 0
<LEASES-CURRENT> 0
<OTHER-ITEMS-CAPITAL-AND-LIAB> 818,987
<TOT-CAPITALIZATION-AND-LIAB> 2,684,536
<GROSS-OPERATING-REVENUE> 527,165
<INCOME-TAX-EXPENSE> 28,678
<OTHER-OPERATING-EXPENSES> 423,926
<TOTAL-OPERATING-EXPENSES> 452,604
<OPERATING-INCOME-LOSS> 74,561
<OTHER-INCOME-NET> 10,360
<INCOME-BEFORE-INTEREST-EXPEN> 84,921
<TOTAL-INTEREST-EXPENSE> 22,745
<NET-INCOME> 62,176
1,327
<EARNINGS-AVAILABLE-FOR-COMM> 60,849
<COMMON-STOCK-DIVIDENDS> 62,603
<TOTAL-INTEREST-ON-BONDS> 19,625
<CASH-FLOW-OPERATIONS> 143,550
<EPS-PRIMARY> 0
<EPS-DILUTED> 0
<PAGE>
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