Exhibit 10.1

TECO ENERGY GROUP

SUPPLEMENTAL EXECUTIVE RETIREMENT PLAN

2007 Amendment and Restatement

PART ONE

GENERAL INFORMATION

SECTION 1. PURPOSE AND EFFECTIVE DATE

The purpose of this plan is to provide key executives of the Company and its
subsidiaries with additional retirement income by supplementing the retirement
benefits provided under the retirement plan. The plan is amended and restated on
December 20, 2007, generally effective as of November 1, 2007 (unless a specific
effective date is provided), but retroactively effective as of January 1, 2005
with respect to the changes incorporated to conform the plan to the restrictions
contained in Section 409A of the Internal Revenue Code and the final Treasury
Regulations thereunder.

SECTION 2. DEFINITIONS

This section contains definitions of some terms used in the plan.

2.1    Board means the Board of Directors of the Company.

2.2    Committee means the retirement plan committee as constituted under the
retirement plan.

2.3    Company means TECO Energy, Inc. and any successor to all or a major
portion of its assets or business which assumes the obligations of the Company
under this plan.

2.4    Employer has the same meaning as in the retirement plan.

2.5    Participant means each employee of an employer who has satisfied the
eligibility requirements set forth in Section 4 or Section 10 hereof.

2.6    Plan means the TECO Energy Group Supplemental Executive Retirement Plan,
as set forth in this plan instrument, and as it may be amended from time to
time.

2.7    Retirement plan means the TECO Energy Group Retirement Plan, as amended
from time to time.

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PART TWO

PARTICIPATION AND BENEFITS FOR EMPLOYEES

OTHER THAN FORMER EMPLOYEES OF PEOPLES GAS SYSTEM, INC.

SECTION 3. DEFINITIONS

This section contains definitions of terms used in this part of the plan that
are not defined in Section 2.

3.1    Annual earnings has the same meaning as in the retirement plan, except
that the same will be determined without regard to any dollar limitation on such
annual earnings that may be imposed under the retirement plan.

3.2    Average annual earnings of a participant as of his retirement date means
the average of his annual earnings during whichever of the following periods
yields the highest average: (a) the 36 consecutive months of active employment
preceding the retirement date (or all months of employment if less than 36), or
(b) any three consecutive calendar years out of the five calendar years
preceding the retirement date. Bonuses are included as compensation for the
period in which paid, provided that if more than three regular annual bonuses
are paid in any 36 consecutive month period, only the largest three consecutive
bonuses will be counted.

3.3    Cause means (a) the willful and continued failure by a participant to
substantially perform his duties with the Company (other than any such failure
resulting from the participant’s incapacity due to physical or mental illness or
any such actual or anticipated failure after the issuance of a notice of
termination by the participant for good reason) after a written demand for
substantial performance is delivered to the participant by the board, which
demand specifically identifies the manner in which the board believes that the
participant has not substantially performed his duties, or (b) the willful
engaging by the participant in conduct which is demonstrably and materially
injurious to the Company, monetarily or otherwise. For purposes of this
Section 3.3, no act, or failure to act, on the participant’s part will be deemed
“willful” unless done, or omitted to be done, by the participant not in good
faith and without reasonable belief that the participant’s action or omission
was in the best interest of the Company. Notwithstanding the foregoing, the
participant will not be deemed to have been terminated for cause unless and
until there shall have been delivered to the participant a copy of a resolution
duly adopted by the affirmative vote of not less than three-quarters (3/4) of
the entire membership of the board at a meeting of the board called and held for
such purpose (after reasonable notice to the participant and an opportunity for
the participant, together with the participant’s counsel, to be heard before the
board), finding that in good faith opinion of the board the participant was
guilty of conduct set forth above in this Section 3.3 and specifying the
particulars thereof in detail.

3.4    Change in control of the company means a change in control of a nature
that would be required to be reported in response to Item 6(e) of Section 14A of
Regulation 14A promulgated under the Securities Exchange Act of 1934, as amended
(the “Exchange Act”),

 

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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 stockholders 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)    the following individuals cease to constitute a majority of the number of
directors then serving: individuals who on the date hereof constitute the Board
and any new director (other than a director whose initial assumption of office
is in connection with an actual or threatened election contest, including but
not limited to a consent solicitation, relating to the election of directors of
the Company) whose election by the Board or nomination for election by the
stockholders 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 on the
date hereof or whose election or nomination for election was previously so
approved, cease for any reason to constitute a majority thereof; or

(c)    there is consummated a merger or consolidation of the Company or any
direct or indirect subsidiary 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 or any parent thereof 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 in this Section 3.4) acquires 30% or more of the combined
voting power of the Company’s then outstanding securities; or

(d)    the stockholders 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.

3.5    Disability income plan means the TECO Energy Disability Income Plan, as
amended from time to time.

3.6     Early retirement age is (i) prior to August 1, 2007, exactly ten years
before the age specified in the table in Section 3.8; or (ii) on and after
August 1, 2007, attainment of age 55.

3.7    Good reason means the occurrence (without the participant’s express
written consent) prior to a change in control of the Company under the
circumstances described in Section 3.14 hereof of any one of the following acts
by the Company, or failures by the Company to act:

 

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(a)    the assignment to the participant of any duties inconsistent (except in
the nature of a promotion) with the position in the Company that the participant
held immediately prior to the potential change in control of the Company or a
substantial adverse alteration in the nature or status of the participant’s
position or responsibilities or the conditions of the participant’s employment
from those in effect immediately prior to the potential change in control of the
Company;

(b)    a reduction by the Company in the participant’s annual base salary as in
effect on the effective date of this Section 3.7, or such higher amount as is in
effect from time to time;

(c)    the Company’s requiring the participant to be based more than fifty
(50) miles from the Company’s offices at which the participant was principally
employed immediately prior to the date of the potential change in control of the
Company except for required travel on the Company’s business to an extent
substantially consistent with the participant’s business travel obligations on
the effective date of this Section 3.7 or, if later, on the date the participant
first becomes eligible for this plan;

(d)    the failure by the Company to pay to the participant any portion of the
participant’s current compensation or compensation under any deferred
compensation program of the Company, within seven (7) days of the date such
compensation is due;

(e)    the failure by the Company to continue in effect any material
compensation or benefit plan in which the participant participates immediately
prior to the change in control of the Company unless an equitable arrangement
(embodied in an ongoing substitute or alternative plan) has been made with
respect to such plan, or the failure by the Company to continue the
participant’s participation therein (or in such substitute or alternative plan)
on a basis not materially less favorable, both in terms of the amount of
benefits provided and the level of the participant’s participation relative to
other participants, than existed at the time of the potential change in control;

(f)    the failure by the Company to continue to provide the participant with
benefits substantially similar to those enjoyed by the participant under any of
the Company’s pension, life insurance, medical, health and accident, or
disability plans in which the participant was participating at the time of the
potential change in control of the Company, the taking of any action by the
Company which would directly or indirectly materially reduce any of such
benefits or deprive the participant of any material fringe benefit enjoyed by
the participant at the time of the potential change in control of the Company,
or the failure by the Company to provide the participant with the number of paid
vacation days to which the participant is entitled on the basis of the
participant’s years of service with the Company in accordance with the Company’s
normal vacation policy in effect at the time of the potential change in control
of the Company;

(g)    the failure of the Company to obtain a satisfactory agreement from any
successor to assume and agree to perform the terms of this plan; or

 

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(h)    any purported termination of the participant’s employment which is not
effected pursuant to a notice of termination satisfying the requirements of all
other agreements between the Company and the participant, which purported
termination shall not be effective for purposes of this plan.

The participant’s right to treat termination of employment as being within this
Section 3.7 will not be affected by the participant’s incapacity due to physical
or mental illness. The participant’s continued employment will not constitute
consent to, or a waiver or rights with respect to, any circumstance constituting
good reason hereunder.

3.8    Normal retirement age for purposes of this plan is exactly three years
before the age specified in the following table:

 

Calendar year of birth    Specified age    Before 1938    65 exactly    1938   
65 and 2 months    1939    65 and 4 months    1940    65 and 6 months    1941   
65 and 8 months    1942    65 and 10 months    1943 through 1954    66 exactly
   1955    66 and 2 months    1956    66 and 4 months    1957    66 and 6 months
   1958    66 and 8 months    1959    66 and 10 months    After 1959    67
exactly   

3.9    Potential change in control of the Company will be deemed to have
occurred if:

(a)    the Company enters into an agreement, the consummation of which would
result in the occurrence of a change in control of the Company;

(b)    any person (as defined in Section 3.4), including the Company, publicly
announces an intention to take or consider taking actions which if consummated
would constitute a change in control of the Company;

(c)    any person (as defined in Section 3.4), 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 stockholders
of the Company in substantially the same proportions as their ownership of stock
of the Company (i) is or becomes the beneficial owner, (ii) discloses directly
or indirectly to the Company or publicly a plan or intention to become the
beneficial owner, or (iii) makes a filing under the Hart-Scott-Rodino Antitrust
Improvements Act of 1976, as amended, with respect to securities to become the
beneficial

 

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owners, directly or indirectly, of securities representing 9.9% or more of the
combined voting power of the outstanding voting securities of the Company; or

(d)    the Board adopts a resolution to the effect that, for purposes of this
plan, a potential change in control of the Company has occurred.

3.10    Retirement means a participant’s termination of employment from an
employer (a) on or after (i) he has reached his normal retirement age, (ii) he
has reached his early retirement age and completed five years of service, or
(iii) a change in control of the Company has occurred, or (b) in contemplation
of a change in control of the Company.

3.11    Service has the same meaning as “plan service” in the retirement plan.

3.12    Social Security benefit of a participant as of his retirement date (the
“computation date”) means the primary insurance amount to which he is or would
be entitled, payable under Title II of the Social Security Act as in effect on
such date, based on the assumptions: (a) that no changes in the benefit levels
payable or the wage base under Title II occur after the computation date; (b) if
the computation date falls on or after the date when he reaches his early
retirement age and before the date when he reaches his normal retirement age,
that his annual earnings during the calendar year in which the computation date
falls and any subsequent calendar year before the year in which his normal
retirement age falls is zero; (c) if the computation date falls before the date
when he reaches his early retirement age, that his annual earnings during the
calendar year in which the computation date falls and during each subsequent
calendar year before the calendar year in which is normal retirement age falls
is equal to his rate of annual earnings on the computation date; (d) that
payment of his primary insurance amount begins for the month after he reaches
normal retirement age, or his retirement date if later, without reduction or
delay because of future gainful employment or delay in applying for benefits;
and (e) that the participant’s earnings for calendar years before the calendar
year in which the computation date falls will be determined using his actual
earnings history if available, and otherwise by applying a six percent
retrospective salary scale to the employee’s rate of annual earnings in effect
on the computation date. The social security benefit of a participant who
retires after the age specified in the table in Section 3.8 will include any
delayed retirement credit.

3.13    Survivor income plan means the TECO Energy Group Survivor Income Plan,
as amended from time to time.

3.14    Termination of employment.    Effective January 1, 2005, for purposes of
qualifying for the payment of benefits under this part two (including
Section 5), “termination of employment” means a termination of employment that
meets the definition of “separation from service” in Treasury Regulations
Section 1.409A-1(h). This definition of termination of employment specifically
qualifies the definitions of “retirement” in Section 3.10 and of “termination of
employment in contemplation of a change in control of the Company” in
Section 3.15.

 

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3.15    Termination of employment in contemplation of a change in control of the
Company means termination of a participant’s employment by the Company without
cause or by the participant with good reason, if (a) the participant’s
employment is terminated by the Company without cause prior to a change in
control of the Company (whether or not such a change in control ever occurs) and
such termination was at the request or direction of a “person” (as such term is
used in Section 13(d) and 14(d) of the Exchange Act) who has entered into an
agreement with the Company the consummation of which would constitute a change
in control of the Company, (b) the participant terminates his employment for
good reason prior to a change in control of the Company (whether or not such a
change in control ever occurs) and the circumstance or event which constitutes
good reason occurs at the request or direction of such person, or (c) the
participant’s employment is terminated by the Company without cause or by the
participant for good reason and such termination or circumstance or event which
constitutes good reason is otherwise in connection with or in anticipation of a
change in control of the Company (whether or not such a change in control ever
occurs).

SECTION 4. PARTICIPATION

Any active employee of an employer who is elected as an officer by such
employer’s board of directors is covered by this part of the plan and is
eligible to receive benefits hereunder if he falls in one of the following
categories, but only if he is not covered by part three of the plan or by
another supplemental executive retirement plan or arrangement of the Company or
any employer:

(a)    he is in salary grade level nine or above (prior to August 1, 2007,
salary grade level five or above), and his participation hereunder is requested
by the Vice President – Human Resources and approved by the Chief Executive
Officer of the Company; or

(b)    he is in a salary grade level below nine (prior to August 1, 2007, below
five), and his participation hereunder is requested by the Vice President –
Human Resources and approved by the Chief Executive Officer of the Company and
the Compensation Committee of the Board.

The provisions of this part two of the plan apply only to participants covered
by part two. References in this part two to “participant” and “eligible”
individuals include only people who are covered by part two.

SECTION 5. RETIREMENT BENEFITS

5.1    Retirement at or after normal retirement age.    Subject to the
reductions described in Section 8.1 below, each eligible officer who retires on
or after attaining normal retirement age will receive a supplemental monthly
pension equal to one-twelfth of the following: (i) for individuals who become
participants prior to August 1, 2007, three percent of his average annual
earnings multiplied by his years of service up to a maximum of 20 years; or
(ii) for individuals who become participants on or after August 1, 2007, two
percent of his average annual earnings multiplied by his years of service up to
a maximum of 30 years. A participant’s retirement

 

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benefit hereunder will be calculated using his years of service and average
annual earnings as of the actual date of his retirement.

5.2    Retirement after early retirement age but before normal retirement
age.    A participant who retires on or after attaining early retirement age but
before attaining normal retirement age and who has completed five years of
service will receive a supplemental monthly pension equal to one-twelfth of the
amount determined using the formula in Section 5.1 above, multiplied by an early
retirement factor determined under the following table:

 

 

Years by which the start

of payments precedes   

normal retirement age* 

 

Early

retirement

factor

                

9

  .55                 

8

  .60                 

7

  .65                 

6

  .70                 

5

  .75                 

4

  .80                 

3

  .85                 

2

  .90                 

1

  .95               

*Interpolate for completed months.

Notwithstanding the foregoing, in the event of a change in control of the
Company and the subsequent retirement of a participant on or after attaining
early retirement age but before normal retirement age, or in the event of
termination of a participant’s employment with the Company on or after attaining
early retirement age but before normal retirement age in contemplation of a
change in control of the Company, the participant will receive the benefits
provided under this Section 5.2 whether or not he has completed five years of
service.

5.3    Effect of change in control prior to attainment of early retirement
age.    In the event of a change in control of the Company prior to the
attainment of early retirement age by any participant, or in the event of
termination of a participant’s employment with the Company prior to the
attainment of early retirement age by the participant in contemplation of a
change in control of the Company, such participant will receive upon his
retirement a supplemental monthly pension equal to one-twelfth of the amount
determined using the formula in Section 5.1 above, multiplied by an early
retirement factor determined under the following table:

 

 

Years by which the start

of payments precedes   

normal retirement age* 

 

Early

retirement

factor

                

30

  .10                 

29

  .11                 

28

  .12                 

27

  .13               

 

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26

  .14                 

25

  .15                 

24

  .16                 

23

  .17                 

22

  .18                 

21

  .20                 

20

  .21                 

19

  .23                 

18

  .25                 

17

  .27                 

16

  .30                 

15

  .32                 

14

  .35                 

13

  .38                 

12

  .41                 

11

  .45                 

10

  .49                 

9

  .54                 

8

  .59               

*Interpolate for completed months.

5.4    Form of Payment.    Notwithstanding any provisions of the plan to the
contrary (including, without limitation, references to payments as a monthly
pension), the only form of retirement benefit payable to a participant under the
plan is a commuted lump sum payment that is the actuarial equivalent of a life
annuity (including the value of earned early retirement subsidies and value of
the post-retirement surviving spouse benefit under Section 6.2(c)). Actuarial
equivalence will be based on the actuarial assumptions specified from time to
time in the retirement plan for lump sum payments. The lump sum payment will be
made on the first day of the month following separation from service (for
payments commencing June 1, 2005 and later and prior to January 1, 2008, on the
first day of the month that is six months following separation from service).
Notwithstanding anything in this plan to the contrary, to the extent required by
Section 409A of the Code, payment of the amounts payable under this Agreement
shall be made no earlier than the earlier of (i) the first day of the first
month commencing at least six (6) months following separation from service with
the Company (within the meaning of Section 409A) or (ii) date of death, with
imputed interest on the delayed payment based on the interest rate used to
determine actuarial equivalence.

5.5    Enhanced benefits for certain retirees.    Certain retirees have been
provided enhanced retirement benefits as set forth in Schedule A hereto.

 

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SECTION 6. SURVIVING SPOUSE BENEFIT

6.1    Eligibility.    The surviving spouse of a deceased participant will
receive the surviving spouse benefit if:

(a)    the participant dies (i) during employment with an employer on or after
he has completed at least five years of service and his combined age and years
of service total 50 or more, or (ii) after retirement; and

(b)    the spouse and the deceased participant were married to each other for at
least the 12 months preceding the participant’s date of death and, in the case
of a participant who dies after retirement, were married to each other on the
participant’s date of retirement.

6.2    Amount of surviving spouse benefit.    Subject to the reductions
described in Section 8.2 below, the benefit provided under the plan to the
surviving spouse of a participant will be determined as follows:

(a)    Pre-retirement before normal retirement age.    If a participant dies
during employment with an employer and before his normal retirement age, his
surviving spouse will receive a monthly survivor income payment equal to 50
percent of the participant’s monthly projected retirement benefit. A
participant’s monthly projected retirement benefit is the monthly benefit he
would have received at normal retirement age under Section 5.1 calculated using
the number of years of service he would have had if he had continued in
employment with an employer until normal retirement age and his average annual
earnings determined as of his date of death.

(b)    Pre-retirement on or after normal retirement age.    If the participant
dies during employment with an employer on or after his normal retirement age,
his surviving spouse will receive a monthly survivor income payment equal to 50
percent of his monthly retirement benefit earned under Section 5.1 using his
number of years of service and his average annual earnings as of his date of
death.

(c)    Post-retirement.    If a participant dies on or after his date of
retirement, his surviving spouse will receive a monthly survivor income payment
equal to 50 percent of the monthly benefit payment he was receiving at his death
(or would have received if he had survived until the first payment date).

6.3    Form and time of surviving spouse benefit.    Notwithstanding any
provisions of the plan to the contrary (including, without limitation,
references to monthly survivor income payments), surviving spouse benefits under
this Section 6 will be payable only in the form of a lump sum payment that is
the actuarial equivalent of a life annuity to the surviving spouse. The lump sum
payment will be made on the first day of the month on or after the date of the
participant’s death.

 

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6.4    Death benefit where lump sum paid.    If a participant received a lump
sum payment of his benefit under Section 5.4, no surviving spouse benefit or
other death benefit will be payable under the plan to any person.

SECTION 7. DISABILITY

7.1    Service during disability.    A participant who suffers a total
disability, as defined in the disability income plan, will continue to be
credited with service as if he were actively employed by an employer during his
period of total disability. If such a participant does not return to active
service with an employer, his benefit under Section 5 will be calculated using
his average annual earnings as of his disability date, his total service
including service credited under the preceding sentence, and his primary social
security benefit calculated as of the date of his disability.

7.2    Period of disability.    A participant’s date of disability is his last
day of work for his employer before becoming unable to continue working because
of his total disability. A period of total disability of a participant will
begin on his disability date and will end on the earlier of the last day of the
month in which his final disability income payment is due under the disability
income plan or on the date he retires hereunder and starts receiving benefit
payments.

7.3    Death while disabled.    If a participant dies while disabled, his
surviving spouse will, if eligible, receive the pre-retirement surviving spouse
benefit determined under Section 6.2(a) or (b).

7.4    No duplication of benefits.    A participant may not receive benefits
under this plan at any time when he is receiving disability income benefits
under the disability income plan.

SECTION 8. OFFSET FOR OTHER PAYMENTS

8.1    Retirement benefit offsets.    The retirement benefit of a participant
will be reduced (but not below zero) by the following payments, with such
reductions starting when such benefits are assumed to begin: (a) 100% percent of
the social security benefit of the participant assuming such benefit begins on
the later of his normal retirement age or his actual retirement, and (b) the
amount of his benefit payments under the retirement plan (converted to a life
annuity if such payments are in an optional form), assuming such payments begin
on the later of his early retirement age or his actual retirement.

8.2    Death benefit offsets.    The benefit of a surviving spouse will be
reduced (but not below zero) by the following payments: (a) payments under the
survivor income plan, and (b) payments under the retirement plan.

 

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PART THREE

PARTICIPATION AND BENEFITS FOR FORMER EMPLOYEES OF

PEOPLES GAS SYSTEM, INC.

SECTION 9. DEFINITIONS

This section contains definitions of terms used in this part of the plan that
are not defined in Section 2.

9.1    Beneficiary means the person or persons, or the estate of a participant,
entitled to receive Part A payments as set forth in Sections 11.1 and 12.1 and
the surviving spouse of a participant and/or the participant’s unmarried
children under the age of twenty three (23) entitled to receive Part B payments
as set forth in Section 11.1 and 12.1 subsequent to the death of a participant.

9.2    Beneficiary designation means the written designation in the form
prescribed by the committee by which each participant names the beneficiary(ies)
of the participant’s benefits under the plan.

9.3    Current compensation means the total compensation as solely determined by
the employer in determining benefits under this plan.

9.4    Covered compensation means the amount specified in Schedule B that forms
the basis for computation of the participant’s death and retirement benefits
pursuant to the terms and conditions of this plan.

9.5    Early retirement date means the date of a participant’s retirement prior
to his normal retirement date, and may occur on the first day of any month
following the month in which the participant attains his fifty-fifth birthday
and ten years of employment with the employer.

9.6    Normal retirement date means the first day of the month following the
month in which the participant attains either his sixty-fifth birthday and has
completed five years as a plan participant or his sixty-second birthday, has
completed five years as a plan participant, and has completed fifteen years of
employment with the employer.

9.7    Retirement and retire means severance of employment with the employer at
or after the attainment of normal retirement date or, with the consent of the
employer, on or after the early retirement date, provided that for distributions
made on or after January 1, 2005 the severance of employment meets the
definition of “separation from service” in Treasury Regulations
Section 1.409A-1(h). This definition specifically applies for the purpose of
determining the participant’s eligibility for benefits under Section 12 of this
plan.

9.8    Years of employment with the employer, years of participation in the
plan, and similar phrases will be construed in such a way that participants
receive full credit for years of

 

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employment with Peoples Gas System, Inc. and any other affiliate of Lykes
Energy, Inc., and years of participation in the Supplemental Executive
Retirement Plan of Lykes Energy, Inc. for all purposes of this plan.

SECTION 10. PARTICIPATION

Any active employee of an employer who was formerly employed by Peoples Gas
System, Inc. or any other affiliate of Lykes Energy, Inc., was a participant in
the Supplemental Executive Retirement Plan of Lykes Energy, Inc. and is listed
on Schedule B to this plan is covered by this part of the plan and is eligible
to receive benefits hereunder. The provisions of this part three of the plan
apply only to participants covered by part three. References in this part three
to “participant” and “eligible” individuals include only people who are covered
by part three.

SECTION 11. DEATH BENEFIT

11.1    Amount and payment.    If a participant dies before retirement, the
employer will pay or cause to be paid a death benefit to such participant’s
beneficiary. Such death benefit will be divided into two parts: Part A and Part
B.

Part A will be paid in one sum to the participant’s beneficiary, as set forth in
his beneficiary designation in effect at the time of death, in an amount equal
to two times the participant’s covered compensation less $50,000, to be paid on
the first day of the month following the participant’s date of death.

Part B will be 40% of the participant’s covered compensation and will be paid in
equal monthly installments for one hundred and eighty months or until the
participant would have attained his sixty-fifth birthday, whichever is later.
Such payment will commence effective the first day of the month following the
date of death.

Notwithstanding the immediately preceding paragraph of this Section 11.1, the
employer will pay or cause to be paid the death benefit specified therein only
if:

 

  (a) at the time of the participant’s death prior to attaining his normal
retirement date such participant was an employee and had not retired, or was
totally disabled or on authorized leave of absence; and

 

  (b) proof of death in such form as determined acceptable by the committee is
furnished.

11.2    Participant disability.    If a participant becomes totally disabled
before retirement, he will remain a participant in this plan, but only if

 

  (a) such disability was not either intentionally self-inflicted or caused by
illegal or criminal acts of the participant; and

 

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  (b) the participant was an employee at the time he became totally disabled.

If a participant dies prior to retirement and while disabled in accordance with
this Section 11.2, the death benefit provided in this Section 11 will be paid.
If a participant retires, the retirement benefit provided in Section 12 will be
paid.

The determination of what constitutes total disability and the removal thereof
for purposes of this Section 11 will be made by the committee, in its sole and
absolute discretion, and such determination will be conclusive.

SECTION 12. RETIREMENT BENEFIT

12.1    Normal retirement.    If a participant has remained an employee until
his normal retirement date and then retires, the employer will pay or cause to
paid to such participant a retirement benefit. Such retirement benefit will be
divided into two parts: Part A and Part B.

Part A will be paid in one sum to the participant’s beneficiary, as set forth in
his beneficiary designation in effect at the time of death in an amount equal to
one times the participant’s covered compensation, to be paid on the first day of
the month following the participant’s date of death.

Part B will be 40% of the participant’s covered compensation and will be paid in
equal monthly installments in an amount as set forth in Schedule B. Payment of
such monthly amount will commence on the participant’s normal retirement date
and will continue for the life of the participant. If the participant dies after
retirement, payments will continue to the beneficiary until January 1 of the
year the participant would have attained his normal life expectancy established
at the date of retirement.

12.2    Retirement after normal retirement date.    A participant who continues
employment with an employer after his normal retirement date may remain a
participant in the plan. Upon retirement such a participant will be entitled to
the benefits provided in Section 12.7 hereof. The monthly payments provided for
in Section 12.7 hereof will commence on the date the participant retires.

12.3    Early retirement.    A participant shall receive an early retirement
benefit commencing as of the first day of any month coincident with or following
the participant’s early retirement date, but before the attainment of his normal
retirement date, provided that the participant retires. In such event, the
participant’s monthly early retirement benefit will be the retirement benefit
(Parts A and B) set forth in Schedule B multiplied by a fraction, the numerator
of which is the number of whole years the employee has been a participant and
the denominator of which is the number of whole years between such participant’s
age at entry into the plan and the participant’s age sixty-five. If the
participant’s benefits have been increased since the participant’s initial entry
into this plan, or successor or predecessor plans, the early retirement

 

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benefit will be determined by reducing each incremental benefit increase in
accordance with the formula. The reduced amounts will be payable as follows:

Part A will be paid in a reduced one sum to the participant’s beneficiary, as
set forth in his beneficiary designation in effect at the time of death, to be
paid on the first day of the month following the participant’s date of death.

Part B will be paid in equal reduced monthly installments. Payment of such
monthly amount will commence on the participant’s early retirement date and will
continue for the life of the participant. If the participant dies after
retirement, payments will continue to the beneficiary until January 1 of the
year the participant would have attained his normal life expectancy established
at the date of retirement.

These reduced amounts shall be the only benefits to which such a participant is
entitled.

12.4    Post-retirement death benefit.    If a participant dies after retirement
but before the applicable retirement benefit is paid in full, the unpaid
retirement benefit payments to which the participant is entitled will continue
to be paid to the participant’s beneficiary. Such payments shall be made in
accordance with the payment schedule to that participant pursuant to Sections
12.1, 12.2 and 12.3 of the plan.

12.5    Exclusivity of post-retirement death benefit.    No death benefit, as
defined in Section 11, will be paid to the beneficiary of a participant who dies
after retirement.

12.6    Accrual of retirement benefit.    A participant who ceases to be an
employee, except as a result of death, retirement, or total disability within
the meaning of Section 11.2, will not be entitled to any benefits hereunder and
the employer will have no obligation hereunder to such participant, provided
that in the event the employer is merged, consolidated, reorganized, or sells
substantially all of its assets to another corporation, firm, or person and such
corporation, firm or person takes action to terminate this plan in accordance
with Section 19 or to terminate a participant in the plan as a result of such
merger, consolidation, reorganization, or sale of assets, such participant will
be entitled to those benefits as described in Sections 11.1 and 12.1 and 12.3.

12.7    Benefit at retirement after attainment of normal retirement date.    If
a participant elects to continue employment beyond his normal retirement date,
the committee, and only the committee, will specify the amount of the
participant’s retirement benefit.

SECTION 13. BENEFICIARY

Each participant will designate his beneficiary to receive benefits under the
plan by completing the beneficiary designation. If more than one beneficiary is
named, the shares and/or precedence of each beneficiary will be indicated in the
designation. A participant will have the right to change the beneficiary by
submitting to the committee a new beneficiary designation. The beneficiary
designation must be approved in writing by the employer; however, upon the
employer’s acknowledgement of approval, the effective date of the beneficiary
designation will

 

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be the date it was executed by the participant. If the employer has any doubts
as to the proper beneficiary to receive payments hereunder, it will have the
right to withhold such payments until the matter is finally adjudicated. Any
payment made by the employer in good faith and in accordance with the provisions
of this plan and a participant’s beneficiary designation will fully discharge
the employer from all further obligations with respect to such payment.

Part B benefits as set forth in Sections 11.1 and 12.1 of the plan will be paid
only to the participant’s surviving spouse and/or participant’s unmarried
children under the age of 23 as shown in the beneficiary designation. Part A
benefits as set forth in Sections 11.1 and 12.1 of the plan will be paid as
shown in the beneficiary designation.

PART FOUR

MISCELLANEOUS

SECTION 14. BENEFITS NOT CURRENTLY FUNDED

14.1    No funding.    Nothing in this plan will be construed to create a trust
or to obligate the Company or any other employer to segregate a fund, purchase
an insurance contract, or in any other way currently to fund the future payment
of any benefits hereunder, nor will anything herein be construed to give any
participant or any other person rights to any specific assets of the Company or
of any other employer or entity.

14.2    Grantor trust.    Notwithstanding Section 14.1, the Company has
established a grantor trust of which it is treated as the owner under
Section 671 of the Internal Revenue Code.

SECTION 15. DEFINITIONS

Where the context so requires, in construing terms used in the plan the
masculine includes the feminine, the singular includes the plural, and the
plural includes the singular.

SECTION 16. ADMINISTRATION

The plan will be administered by the committee, which will have full power and
authority to construe, interpret and administer the plan. Decisions of the
committee will be final and binding on all persons. The committee may, in its
discretion, adopt, amend, and rescind rules and regulations relating to the
administration of the plan.

SECTION 17. RIGHTS NON-ASSIGNABLE

No participant, surviving spouse, beneficiary, or any other person will have any
right to assign or otherwise to alienate the right to receive payments under the
plan, in whole or in part.

SECTION 18. EXCESS BENEFIT PLAN

This plan will supersede any obligation to pay to participants excess plan
benefits under any excess benefit plan provisions in the retirement plan, as
such plan may be amended from

 

16

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time to time; no excess plan benefits will be payable under any such excess
benefit plan to participants.

SECTION 19. AMENDMENT OR TERMINATION

The Company reserves the right at any time by action of the board to terminate
the plan or to amend its provisions in any way, subject to the requirements of
Section 409A. In addition, if the retirement plan is terminated, this plan will
automatically terminate also as of the same effective date, subject to the
Section 409A requirements. Notwithstanding the foregoing, no termination or
amendment of the plan may reduce the benefits payable under the plan to any
person with respect to a participant whose employment with his employer was
terminated before such termination or amendment and no termination or amendment
may reduce the benefits to be paid with respect to a participant on the date of
such termination or amendment below the amount which such participant would have
received if his employment had terminated on the date before such termination or
amendment.

EXECUTED as of December 20, 2007.

 

TECO ENERGY, INC. By:  

/s/  Clinton E. Childress

 

Clinton E. Childress

Chief Human Resources Officer

 

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SCHEDULE A

Enhanced Retirement Benefits

A.1.    David N. Campbell and G. Pierce Wood. The retirement benefits of David
N. Campbell and G. Pierce Wood are to be calculated as though each had continued
in employment until age 62 with annual earning equal to the rate of earning in
effect on his date of termination of employment.

A.2.    1994-95 Early Retirement Window.

(a)    The retirement benefits of each of the following participants are to be
calculated by using the factors set forth below:

 

Name

 

Increase in Age

 

Increase in Service

     William T. Snyder   3 years, 8 months   N/A   Robert T. Tomczak   3 years  
3 years   Fred W. Maggard   4 years   4 years   R.D. Cornell   4 years   4 years
 

(b)    Average annual earnings for each of Philip G. Flood and John G. Graham is
to be calculated using the three consecutive calendar years out of the five
calendar years preceding the date of retirement which yield the highest average.

A.3.    Larry D. Noland. The retirement benefit of Larry D. Noland is to be
calculated as though he were age 62  1/2 on his retirement date, resulting in an
increase in the benefit otherwise payable under the plan of $1,062.93 per month.

 

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SCHEDULE B

Covered Compensation and Part A and Part B Benefits of

Participants Covered by Part Three of the Plan

 

   

Death benefits

(Section 11.1)

 

Retirement benefits

(Section 12.1)

Participant

 

Covered

Compensation

  Part A   Part B   Part A   Part B

Gerald E. Cox

  $138,445   N/A*   N/A*   $138,445   $4,614.82

Wayne E. Huffman

  $114,736   N/A*   N/A*   $114,736   $3,824.53

Ernest L. Mize

  $96,626   N/A*   N/A*   $96,626   $3,220.87

Frank J. Sivard

  $146,257   **$242,514   **$4,875.23   ***$146,257   ***$4,875.23

M. Lee Young

  $179,610   N/A*   N/A*   $90,974.33   ****$3,032.48

 

* He did not die before retirement, so he is not entitled to death benefits
under Section 11.1.

** Payable only if he dies before retirement.

*** Payable only if he retires before death.

**** Includes $933.01 per month for two extra years of service in accordance
with severance agreement.

 

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