August 13, 2004
FPL Group announces settlement of shareholder litigation
JUNO BEACH, Fla. – FPL Group, Inc. (NYSE:FPL) today announced
a settlement, subject to court approval, of derivative litigation
filed by certain shareholders in the name of the company regarding
change-of-control payments made in December 2000 in conjunction with
the proposed Entergy merger that was approved by shareholders but
not consummated. The settlement is the end result of a mediation
process that began in June before retired Judge Nicholas H. Politan
as the independent mediator. It does not contain any admission or
finding of liability or wrongdoing by the company or by any individual.
In the proposed settlement, eight current and former senior executives
of FPL Group and an insurance carrier will pay a total of $22.25
million, representing a portion of the compensation that the executives
received in December 2000. The eight individuals received payments,
as a result of shareholder approval of the proposed merger, under
change-of-control provisions that accelerated the payments of previously
granted awards under the company’s Long Term Incentive Plan.
Under the terms of the Long Term Incentive Plan, which was originally
adopted by shareholder vote in 1994 and was reauthorized by shareholder
vote in 1999, the executives over time would have received a substantial
portion of the amounts awarded regardless of whether the merger vote
occurred.
Over the past three years, FPL Group has strengthened and enhanced
its corporate governance procedures, and respected independent monitoring
organizations currently rate it among the top companies for corporate
governance. In furtherance of its desire for continuous improvement,
FPL Group has undertaken in the settlement to implement several additional
enhancements to its governance procedures.
FPL Group stated that it is pleased to have reached agreement on
a settlement so that the company can focus all of its attention on
providing service for customers and creating value for shareholders,
without the distraction of this litigation.
The company said that, if the settlement is approved, the net amount
of the payment it receives would be recorded as a gain.
FPL Group, with annual revenues of more than $9 billion, is nationally
known as a high quality, efficient, and customer-driven organization
focused on energy-related products and services. With a growing presence
in 26 states, it is widely recognized as one of the country's premier
power companies. Its principal subsidiary, Florida Power & Light
Company, serves more than 4.2 million customer accounts in Florida.
FPL Energy, LLC, an FPL Group wholesale energy-generating subsidiary,
is a leader in producing electricity from clean and renewable fuels.
Additional information is available on the Internet at www.FPLGroup.com,
www.FPL.com and www.FPLEnergy.com.
