ALLIANT ENERGY CORPORATION
2002 EQUITY INCENTIVE PLAN
Section 1. Purpose
The purpose of the Alliant Energy Corporation 2002 Equity Incentive
Plan (the "Plan") is to promote the best interests of Alliant Energy Corporation
(together with any successor thereto, the "Company") and its shareowners by
providing key employees and non-employee directors of the Company and its
Affiliates (as defined below) with an opportunity to acquire a proprietary
interest in the Company. It is intended that the Plan will promote continuity of
management and increased incentive and personal interest in the welfare of the
Company by those key employees who are primarily responsible for shaping and
carrying out the long-range plans of the Company and securing the Company's
continued growth and financial success. In addition, by encouraging stock
ownership by directors who are not employees of the Company or its Affiliates,
the Company seeks to attract and retain on its Board of Directors persons of
exceptional competence and to provide a further incentive to serve as a director
of the Company.
Section 2. Definitions
As used in the Plan, the following terms shall have the respective
meanings set forth below:
(a) "Affiliate" shall mean any entity that, directly or through one
or more intermediaries, is controlled by, controls, or is under common control
with, the Company.
(b) "Award" shall mean any Option, Stock Appreciation Right,
Restricted Stock, Restricted Stock Unit, Performance Share or Performance Unit
granted under the Plan.
(c) "Award Agreement" shall mean any written agreement, contract, or
other instrument or document evidencing any Award granted under the Plan.
(d) "Code" shall mean the Internal Revenue Code of 1986, as amended
from time to time. Any reference to a specific provision of the Code shall also
be deemed a reference to any successor provision thereto.
(e) "Commission" shall mean the United States Securities and
Exchange Commission or any successor agency.
(f) "Committee" shall mean a committee of the Board of Directors of
the Company designated by such Board to administer the Plan and comprised solely
of not less than two directors, each of whom is a "non-employee director" within
the meaning of Rule 16b-3 and each of whom is an "outside director" within the
meaning of Section 162(m)(4)(C) of the Code; provided that the mere fact that
the Committee shall fail to qualify under the foregoing requirements shall not
invalidate any Award made by the Committee that is otherwise validly made
under the Plan, unless the Committee is aware at the time of the Award's grant
of the Committee's failure to so qualify.
(g) "Dividend Equivalent" shall mean a right, granted to a
Participating Key Employee or a Non-Employee Director under the Plan, to receive
cash equal to the cash dividends paid with respect to a specified number of
Shares. Dividend Equivalents shall not be deemed to be Awards under the Plan.
(h) "Exchange Act" shall mean the Securities Exchange Act of 1934,
as amended from time to time.
(i) "Excluded Items" shall mean any items which the Committee
determines shall be excluded in fixing Performance Goals, including, without
limitation, any gains or losses from discontinued operations, any extraordinary
gains or losses and the effects of accounting changes.
(j) "Fair Market Value" shall mean, with respect to any property
(including, without limitation, any Shares or other securities), the fair market
value of such property determined by such methods or procedures as shall be
established from time to time by the Committee.
(k) "Incentive Stock Option" shall mean an option granted under
Section 6(a) of the Plan that is intended to meet the requirements of Section
422 of the Code.
(l) "Key Employee" shall mean any officer or other key employee of
the Company or of any Affiliate who is responsible for or contributes to the
management, growth or profitability of the business of the Company or any
Affiliate as determined by the Committee.
(m) "Non-Employee Director" shall mean a director of the Company or
any Affiliate who is not an employee of the Company or any Affiliate.
(n) "Non-Qualified Stock Option" shall mean an option granted under
Section 6(a) of the Plan that is not intended to be an Incentive Stock Option.
(o) "Option" shall mean an Incentive Stock Option or a Non-Qualified
Stock Option.
(p) "Participating Key Employee" shall mean a Key Employee
designated to be granted an Award under the Plan.
(q) "Performance Goals" shall mean each of, or a combination of one
or more of, the following (in all cases after excluding the impact of applicable
Excluded Items):
(i) Return on equity;
(ii) Return on investment;
(iii) Return on net assets;
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(iv) Return on revenues;
(v) Operating income;
(vi) Performance value added (as defined by the
Committee at the time of selection);
(vii) Pre-tax profits;
(viii) Net income;
(ix) Net earnings per Share;
(x) Working capital as a percent of net sales;
(xi) Net cash provided by operating activities;
(xii) Market price per Share;
(xiii) Total shareowner return; and
(xiv) Key operational measures, which shall be deemed to
include customer loyalty, customer satisfaction, employee safety,
market share, system reliability and cost structure reduction,
measured in each case for the Performance Period (aa) for the Company on a
consolidated basis, (bb) for any one or more Affiliates or divisions of the
Company, where appropriate, and/or (cc) for any other business unit or units of
the Company or any Affiliate, where appropriate, as defined by the Committee at
the time of selection; provided that it shall only be appropriate to measure net
earnings per Share and market price per Share on a consolidated basis.
(r) "Performance Period" shall mean, in relation to Performance
Shares or Performance Units, any period for which a Performance Goal or Goals
have been established; provided, however, that such period shall not be less
than one year.
(s) "Performance Share" shall mean any right granted under Section
6(e) of the Plan that will be paid out in cash, as a Share (which, in specified
circumstances, may be a Share of Restricted Stock) or as a Restricted Stock
Unit, which right is contingent on the achievement of one or more Performance
Goals during a specified Performance Period.
(t) "Performance Unit" shall mean any right granted under Section
6(e) of the Plan to receive a designated dollar value amount in cash, Shares
(which, in specified circumstances, may be a designated dollar value amount of
Shares of Restricted Stock) or Restricted Stock Units, which right is contingent
on the achievement of one or more Performance Goals during a specified
Performance Period.
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(u) "Person" shall mean any individual, corporation, partnership,
association, joint-stock company, trust, unincorporated organization, or
government or political subdivision thereof.
(v) "Released Securities" shall mean Shares of Restricted Stock with
respect to which all applicable restrictions have expired, lapsed, or been
waived.
(w) "Restricted Securities" shall mean Awards of Restricted Stock or
other Awards under which issued and outstanding Shares are held subject to
certain restrictions.
(x) "Restricted Stock" shall mean any Share granted under Section
6(c) of the Plan or, in specified circumstances, a Share paid in connection with
another Award, with such Share subject to risk of forfeiture and restrictions on
transfer or other restrictions that will lapse upon the achievement of one or
more goals relating to completion of service by the Key Employee or the
achievement of performance or other objectives, as determined by the Committee.
(y) "Restricted Stock Unit" shall mean any right to receive Shares
in the future granted under Section 6(d) of the Plan or paid in connection with
another Award, with such right subject to risk of forfeiture and restrictions on
transfer or other restrictions that will lapse upon the achievement of one or
more goals relating to completion of service by the Key Employee or the
achievement of performance or other objectives, as determined by the Committee.
(z) "Rule 16b-3" shall mean Rule 16b-3 as promulgated by the
Commission under the Exchange Act, or any successor rule or regulation thereto.
(aa) "Shares" shall mean shares of common stock of the Company, $.01
par value, and such other securities or property as may become subject to Awards
pursuant to an adjustment made under Section 4(b) of the Plan.
(bb) "Stock Appreciation Right" shall mean any right granted under
Section 6(b) of the Plan.
Section 3. Administration
The Plan shall be administered by the Committee; provided, however,
that if at any time the Committee shall not be in existence, the functions of
the Committee as specified in the Plan shall be exercised by a committee
consisting of those members of the Board of Directors of the Company who qualify
as "non-employee directors" under Rule 16b-3 and as "outside directors" under
Section 162(m)(4)(C) of the Code. To the extent permitted by applicable law, the
Committee may delegate to one or more executive officers of the Company any or
all of the authority and responsibility of the Committee with respect to the
Plan, other than with respect to Persons who are subject to Section 16 of the
Exchange Act. To the extent the Committee has so delegated to one or more
executive officers the authority and responsibility of the Committee, all
references to the Committee herein shall include such officer or officers.
Subject to the terms of the Plan and without limitation by reason of
enumeration, the Committee shall have full discretionary power and authority to:
(i) designate Participating Key
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Employees and select Non-Employee Directors to be participants under the Plan;
(ii) determine the type or types of Awards to be granted to each Participating
Key Employee and Non-Employee Director under the Plan; (iii) determine the
number of Shares to be covered by (or with respect to which payments, rights, or
other matters are to be calculated in connection with) Awards granted to
Participating Key Employees or Non-Employee Directors; (iv) determine the terms
and conditions of any Award granted to a Participating Key Employee or
Non-Employee Director (provided, however, that the exercise price of any Option
shall not be less than 100% of the Fair Market Value of a Share on the date of
grant of such Option); (v) determine whether, to what extent, and under what
circumstances Awards granted to Participating Key Employees or Non-Employee
Directors may be settled or exercised in cash, Shares, other securities, other
Awards, or other property, and the method or methods by which Awards may be
settled, exercised, cancelled, forfeited, or suspended; (vi) determine whether,
to what extent, and under what circumstances cash, Shares, other Awards, and
other amounts payable with respect to an Award granted to Participating Key
Employees of Non-Employee Directors under the Plan shall be deferred either
automatically or at the election of the holder thereof or of the Committee;
(vii) interpret and administer the Plan and any instrument or agreement relating
to, or Award made under, the Plan (including, without limitation, any Award
Agreement); (viii) establish, amend, suspend, or waive such rules and
regulations and appoint such agents as it shall deem appropriate for the proper
administration of the Plan; and (ix) make any other determination and take any
other action that the Committee deems necessary or desirable for the
administration of the Plan. Unless otherwise expressly provided in the Plan, all
designations, determinations, interpretations, and other decisions under or with
respect to the Plan or any Award shall be within the sole discretion of the
Committee, may be made at any time, and shall be final, conclusive, and binding
upon all Persons, including the Company, any Affiliate, any Participating Key
Employee, any Non-Employee Director, any holder or beneficiary of any Award, any
shareowner, and any employee of the Company or of any Affiliate.
Section 4. Shares Available for Award
(a) Shares Available. Subject to adjustment as provided in Section
4(b):
(i) Number of Shares Available. The number of Shares
with respect to which Awards may be granted under the Plan shall be
4,000,000 Shares. If, after the effective date of the Plan, any
Shares covered by an Award granted under the Plan, or to which any
Award relates, are forfeited or if an Award otherwise terminates,
expires or is cancelled prior to the delivery of all of the Shares
or of other consideration issuable or payable pursuant to such
Award, then the number of Shares counted against the number of
Shares available under the Plan in connection with the grant of such
Award, to the extent of any such forfeiture, termination, expiration
or cancellation, shall again be available for granting of additional
Awards under the Plan.
(ii) Limitations on Awards to Individual Participants.
No Participating Key Employee shall be granted, during any calendar
year, Options for more than 500,000 Shares, Stock Appreciation
Rights with respect to more than 500,000 Shares, more than 200,000
Shares of Restricted Stock, more than 200,000 Restricted Stock
Units, more than 200,000 Performance Shares nor more than 200,000
Performance Units under the Plan. In all cases, determinations under
this Section 4(a)(ii) shall be made in a manner
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that is consistent with the exemption for performance-based
compensation provided by Section 162(m) of the Code and any
regulations promulgated thereunder.
(iii) Accounting for Awards. The number of Shares
covered by an Award under the Plan, or to which such Award relates,
shall be counted on the date of grant of such Award against the
number of Shares available for granting Awards under the Plan.
(iv) Sources of Shares Deliverable Under Awards. Any
Shares delivered pursuant to an Award may consist, in whole or in
part, of authorized and unissued Shares or of treasury Shares.
(b) Adjustments. In the event that the Committee shall determine
that any dividend or other distribution (whether in the form of cash, Shares,
other securities, or other property), recapitalization, stock split, reverse
stock split, reorganization, merger, consolidation, split-up, spin-off,
combination, repurchase, or exchange of Shares or other securities of the
Company, issuance of warrants or other rights to purchase Shares or other
securities of the Company, or other similar corporate transaction or event
affects the Shares such that an adjustment is determined by the Committee to be
appropriate, then the Committee may, in such manner as it may deem equitable,
adjust any or all of (i) the number and type of Shares subject to the Plan and
which thereafter may be made the subject of Awards under the Plan, (ii) the
number and type of Shares subject to the individual participant limits of
Section 4(a)(ii), (iii) the number and type of Shares subject to outstanding
Awards, and (iv) the grant, purchase, or exercise price with respect to any
Award to reflect such transaction or event; or, if deemed appropriate, make
provision for a cash payment to the holder of an outstanding Award in exchange
for cancellation of such Award or in lieu of any or all of the foregoing
adjustments; provided, however, in each case, that with respect to Awards of
Incentive Stock Options no such adjustment shall be authorized to the extent
that such authority would cause the Plan to violate Section 422(b) of the Code;
and provided further that the number of Shares subject to any Award payable or
denominated in Shares shall always be a whole number.
Section 5. Eligibility
The Committee may designate any Key Employee as a Participating Key
Employee. All Non-Employee Directors shall be eligible to receive, at the
discretion of the Committee, Awards of Non-Qualified Stock Options pursuant to
Section 6(a).
Section 6. Awards
(a) Option Awards. The Committee may grant Options to Key Employees
and Non-Employee Directors with the terms and conditions as set forth below and
with such additional terms and conditions, in either case not inconsistent with
the provisions of the Plan, as the Committee shall determine.
(i) Type of Option. The Committee shall determine
whether an Option granted to a Participating Key Employee is to be
an Incentive Stock Option or Non-Qualified Stock Option; provided,
however, that Incentive Stock Options may be granted
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only to Key Employees of the Company, a parent corporation (within
the meaning of Code Section 424(e)) or a subsidiary corporation
(within the meaning of Code Section 424(f)). All Options granted to
Non-Employee Directors shall be Non-Qualified Stock Options.
(ii) Exercise Price. The exercise price per Share of an
Option granted pursuant to this Section 6(a) shall be determined by
the Committee; provided, however, that such exercise price shall not
be less than 100% of the Fair Market Value of a Share on the date of
grant of such Option.
(iii) Option Term. The term of each Option shall be
fixed by the Committee; provided, however, that in no event shall
the term of any Option exceed a period of ten years from the date of
its grant.
(iv) Exercisability and Method of Exercise. An Option
shall become exercisable in such manner and within such period or
periods and in such installments or otherwise as shall be determined
by the Committee; provided, however, that no Option may vest and
become exercisable within a period that is less than one year from
the date of grant of such Option (subject to acceleration of
vesting, to the extent permitted by the Committee, in the event of
the Participating Key Employee's or Non-Employee Director's death,
disability, retirement or involuntary termination or in the event of
a change in control of the Company (as defined by the Committee)).
The Committee also shall determine the method or methods by which,
and the form or forms, including, without limitation, cash, Shares,
other securities, other Awards, or other property, or any
combination thereof, having a Fair Market Value on the exercise date
equal to the relevant exercise price, in which payment of the
exercise price with respect to any Option may be made or deemed to
have been made.
(v) Incentive Stock Options. The terms of any Incentive
Stock Option granted to a Key Employee under the Plan shall comply
in all respects with the provisions of Section 422 of the Code and
any regulations promulgated thereunder. Notwithstanding any
provision in the Plan to the contrary, no Incentive Stock Option may
be granted hereunder after the tenth anniversary of the adoption of
the Plan by the Board of Directors.
(b) Stock Appreciation Rights. The Committee may grant Stock
Appreciation Rights to Key Employees. Non-Employee Directors are not eligible to
be granted Stock Appreciation Rights under the Plan. Subject to the terms of the
Plan and any applicable Award Agreement, a Stock Appreciation Right granted
under the Plan shall confer on the holder thereof a right to receive, upon
exercise thereof, the excess of (i) the Fair Market Value of one Share on the
date of exercise over (ii) the grant price of the Stock Appreciation Right as
specified by the Committee, which shall not be less than 100% of the Fair Market
Value of one Share on the date of grant of the Stock Appreciation Right. Subject
to the terms of the Plan, the grant price, term, methods of exercise, methods of
settlement (including whether the Participating Key Employee will be paid in
cash, Shares, other securities, other Awards, or other property, or any
combination thereof), and any other terms and conditions of any Stock
Appreciation Right shall be determined by the Committee. The Committee may
impose such conditions or restrictions on the exercise of any Stock Appreciation
Right as it may deem appropriate.
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(c) Restricted Stock Awards.
(i) Issuance. The Committee may grant Awards of
Restricted Stock to Key Employees; provided, however, that the
aggregate number of Shares of Restricted Stock and Shares underlying
Restricted Stock Units granted (and not subsequently forfeited)
under the Plan to all Participating Key Employees as a group shall
not exceed 400,000 (such number of Shares subject to adjustment in
accordance with the terms of Section 4(b) hereof). Non-Employee
Directors are not eligible to be granted Restricted Stock under the
Plan.
(ii) Restrictions. Shares of Restricted Stock granted to
Participating Key Employees shall be subject to such restrictions as
the Committee may impose (including, without limitation, any
limitation on the right to vote a Share of Restricted Stock or the
right to receive any dividend or other right or property), which
restrictions may lapse separately or in combination at such time or
times, in such installments or otherwise, as the Committee may deem
appropriate.
(iii) Registration. Any Restricted Stock granted under
the Plan to a Participating Key Employee may be evidenced in such
manner as the Committee may deem appropriate, including, without
limitation, book-entry registration or issuance of a stock
certificate or certificates. In the event any stock certificate is
issued in respect of Shares of Restricted Stock granted under the
Plan to a Participating Key Employee, such certificate shall be
registered in the name of the Participating Key Employee and shall
bear an appropriate legend (as determined by the Committee)
referring to the terms, conditions, and restrictions applicable to
such Restricted Stock.
(iv) Payment of Restricted Stock. At the end of the
applicable restriction period relating to Restricted Stock granted
to a Participating Key Employee, one or more stock certificates for
the appropriate number of Shares, free of restrictions imposed under
the Plan, shall be delivered to the Participating Key Employee, or,
if the Participating Key Employee received stock certificates
representing the Restricted Stock at the time of grant, the legends
placed on such certificates shall be removed.
(v) Forfeiture. Except as otherwise determined by the
Committee, upon termination of employment of a Participating Key
Employee (as determined under criteria established by the Committee)
for any reason during the applicable restriction period, all Shares
of Restricted Stock still subject to restriction shall be forfeited
by the Participating Key Employee; provided, however, that the
Committee may, when it finds that a waiver would be in the best
interests of the Company, waive in whole or in part any or all
remaining restrictions with respect to Shares of Restricted Stock
held by a Participating Key Employee.
(vi) Minimum Period of Service. If the right to become
vested in a Restricted Stock Award granted under this Section 6(c)
is conditioned on the completion of a specified period of service
with the Company or its Affiliates, without achievement of
Performance Goals or other performance objectives being required as
a condition of vesting, and without it being granted in lieu of
other compensation, then the required
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period of service for vesting shall be not less than three years
(subject to acceleration of vesting, to the extent permitted by the
Committee, in the event of the Participating Key Employee's death,
disability, retirement or involuntary termination or in the event of
a change in control of the Company (as defined by the Committee)).
(d) Restricted Stock Units.
(i) Issuance. The Committee may grant Awards of
Restricted Stock Units to Key Employees; provided, however, that the
aggregate number of Shares underlying Restricted Stock Units and
Shares of Restricted Stock granted (and not subsequently forfeited)
under the Plan to all Participating Key Employees as a group shall
not exceed 400,000 (such number of Units and Shares subject to
adjustment in accordance with the terms of Section 4(b) hereof).
Non-Employee Directors are not eligible to be granted Restricted
Stock Units under the Plan.
(ii) Restrictions. Restricted Stock Units granted to
Participating Key Employees shall be subject to such restrictions as
the Committee may impose, which restrictions may lapse separately or
in combination at such time or times, in such installments or
otherwise, as the Committee may deem appropriate.
(iii) Payment of Shares. At the end of the applicable
restriction period relating to Restricted Stock Units granted to a
Participating Key Employee, one or more stock certificates for the
number of Shares equal to the corresponding number of Restricted
Stock Units, free of restrictions imposed under the Plan, shall be
delivered to the Participating Key Employee.
(iv) Forfeiture. Except as otherwise determined by the
Committee, upon termination of employment of a Participating Key
Employee (as determined under criteria established by the Committee)
for any reason during the applicable restriction period, all
unvested Restricted Stock Units shall be forfeited by the
Participating Key Employee; provided, however, that the Committee
may, when it finds that a waiver would be in the best interests of
the Company, waive in whole or in part any or all remaining
restrictions with respect to Restricted Stock Units held by a
Participating Key Employee.
(v) Minimum Period of Service. If the right to become
vested in a Restricted Stock Unit Award granted under this Section
6(d) is conditioned on the completion of a specified period of
service with the Company or its Affiliates, without achievement of
Performance Goals or other performance objectives being required as
a condition of vesting, and without it being granted in lieu of
other compensation, then the required period of service for vesting
shall be not less than three years (subject to acceleration of
vesting, to the extent permitted by the Committee, in the event of
the Participating Key Employee's death, disability, retirement or
involuntary termination or in the event of a change in control of
the Company (as defined by the Committee)).
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(e) Performance Shares and Performance Units.
(i) Issuance. The Committee may grant Awards of
Performance Shares and/or Performance Units to Key Employees.
Non-Employee Directors are not eligible to be granted Performance
Shares or Performance Units under the Plan.
(ii) Performance Goals and Other Terms. The Committee
shall determine the Performance Period, the Performance Goal or
Goals (and the performance level or levels related thereto) to be
achieved during any Performance Period, the proportion of payments,
if any, to be made for performance between the minimum and full
performance levels for any Performance Goal and, if applicable, the
relative percentage weighting given to each of the selected
Performance Goals. The Committee shall also determine the
restrictions applicable to Shares of Restricted Stock or Restricted
Stock Units received upon payment of Performance Shares or
Performance Units if Performance Shares or Performance Units are
paid in such manner, and any other terms, conditions and rights
relating to a grant of Performance Shares or Performance Units. The
Committee shall have sole discretion to alter the selected
Performance Goals set forth in Section 2(q), subject to shareowner
approval, to the extent required to qualify the Award for the
performance-based exemption provided by Section 162(m) of the Code.
Notwithstanding the foregoing, in the event the Committee determines
it is advisable to grant Performance Shares or Performance Units
which do not qualify for the performance-based exemption under
Section 162(m) of the Code, the Committee may make such grants
without satisfying the requirements thereof.
(iii) No Voting Rights. Participating Key Employees
shall have no voting rights with respect to Performance Shares or
Shares underlying Performance Units held by them during the
applicable Performance Period.
(iv) Payment. As soon as is reasonably practicable
following the end of the applicable Performance Period, and subject
to the Committee certifying in writing as to the satisfaction of the
requisite Performance Goal or Goals if such certification is
required in order to qualify the Award for the performance-based
exemption provided by Section 162(m) of the Code, payment of earned
Performance Shares and/or Performance Units shall be made. The
Committee, in its sole discretion, may pay earned Performance Shares
and Performance Units in the form of cash, Shares (which may be
Shares of Restricted Stock), Restricted Stock Units or a combination
of cash, Shares (which may be Shares of Restricted Stock) and/or
Restricted Stock Units, which have an aggregate Fair Market Value
equal to the value of the earned Performance Shares and Shares
underlying earned Performance Units at the close of the applicable
Performance Period. Any Shares of Restricted Stock payable in
connection with Performance Shares or Performance Units shall,
pending the expiration, lapse, or waiver of the applicable
restrictions, be evidenced in the manner as set forth in Section
6(c)(iii) hereof.
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(f) General.
(i) No Consideration for Awards. Awards shall be granted
to Participating Key Employees and Non-Employee Directors for no
cash consideration unless otherwise determined by the Committee.
(ii) Award Agreements. Each Award granted under the Plan
shall be evidenced by an Award Agreement in such form (consistent
with the terms of the Plan) as shall have been approved by the
Committee.
(iii) Awards May Be Granted Separately or Together.
Awards to Participating Key Employees under the Plan may be granted
either alone or in addition to, in tandem with, or in substitution
for any other Award or any award granted under any other plan of the
Company or any Affiliate. Awards granted in addition to or in tandem
with other Awards, or in addition to or in tandem with awards
granted under any other plan of the Company or any Affiliate, may be
granted either at the same time as or at a different time from the
grant of such other Awards or awards.
(iv) Forms of Payment Under Awards. Subject to the terms
of the Plan and of any applicable Award Agreement, payments or
transfers to be made by the Company or an Affiliate upon the grant,
exercise, or payment of an Award to a Participating Key Employee or
Non-Employee Director may be made in such form or forms as the
Committee shall determine, and may be made in a single payment or
transfer, in installments, or on a deferred basis, in each case in
accordance with rules and procedures established by the Committee.
Such rules and procedures may include, without limitation,
provisions for the payment or crediting of interest on installment
or deferred payments.
(v) Limits on Transfer of Awards. Except as otherwise
provided by the Committee, no Award (other than Released
Securities), and no right under any such Award, shall be assignable,
alienable, saleable, or transferable by a Participating Key Employee
or Non-Employee Director otherwise than by will or by the laws of
descent and distribution (or, in the case of an Award of Restricted
Securities, to the Company); provided, however, that a Participating
Key Employee or Non-Employee Director at the discretion of the
Committee may be entitled, in the manner established by the
Committee, to designate a beneficiary or beneficiaries to exercise
his or her rights, and to receive any property distributable, with
respect to any Award upon the death of the Participating Key
Employee or Non-Employee Director, as the case may be. Each Award,
and each right under any Award, shall be exercisable, during the
lifetime of the Participating Key Employee or Non-Employee Director,
only by such individual or, if permissible under applicable law, by
such individual's guardian or legal representative. Except as
otherwise provided by the Committee, no Award (other than Released
Securities), and no right under any such Award, may be pledged,
alienated, attached, or otherwise encumbered, and any purported
pledge, alienation, attachment, or encumbrance thereof shall be void
and unenforceable against the Company or any Affiliate.
(vi) Term of Awards. Except as otherwise provided in the
Plan, the term of each Award shall be for such period as may be
determined by the Committee.
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(vii) Share Certificates; Representation. In addition to
the restrictions imposed pursuant to Section 6(c) and Section 6(e)
hereof, all certificates for Shares delivered under the Plan
pursuant to any Award or the exercise thereof shall be subject to
such stop transfer orders and other restrictions as the Committee
may deem advisable under the Plan or the rules, regulations, and
other requirements of the Commission, any stock exchange or other
market upon which such Shares are then listed or traded, and any
applicable federal or state securities laws, and the Committee may
cause a legend or legends to be put on any such certificates to make
appropriate reference to such restrictions. The Committee may
require each Participating Key Employee, Non-Employee Director or
other Person who acquires Shares under the Plan by means of an Award
originally made to a Participating Key Employee or Non-Employee
Director to represent to the Company in writing that such
Participating Key Employee, Non-Employee Director or other Person is
acquiring the Shares without a view to the distribution thereof.
(g) Dividend Equivalents. In addition to Awards granted under the
Plan, the Committee may grant Dividend Equivalents to Participating Key
Employees and Non-Employee Directors, entitling the Participating Key Employees
and Non-Employee Directors to receive cash equal to cash dividends paid with
respect to a specified number of Shares. Dividend Equivalents may only be
granted in connection with an Award granted to the Participating Key Employee or
Non-Employee Director under the Plan. The Committee may provide that Dividend
Equivalents shall be paid or distributed when accrued or shall be deemed to have
been reinvested in such investment vehicles as determined by the Committee,
subject to such restrictions and risks of forfeiture as the Committee may
impose.
(h) No Repricing of Options. Except adjustments made pursuant to
Section 4(b) or adjustments made with prior approval of the Company's
shareowners, the Committee shall not have the authority to effect (i) the
repricing of any outstanding Options under the Plan or (ii) the modification of
an Option or entering into a transaction or series of transactions which
modification or transaction(s) would be deemed to constitute a repricing of an
Option pursuant to Financial Accounting Standards Board Interpretation No. 44,
Accounting for Certain Transactions Involving Stock Compensation, March 2000, as
amended or supplemented from time to time. The provisions of this Section 6(h)
cannot be amended unless the amendment is approved by the Company's shareowners.
Section 7. Amendment and Termination of the Plan; Correction of Defects and
Omissions
(a) Amendments to and Termination of the Plan. Except as otherwise
provided herein, the Board of Directors of the Company may at any time amend,
alter, suspend, discontinue, or terminate the Plan; provided, however, that
shareowner approval of any amendment of the Plan shall also be obtained (i) if
such amendment (A) increases the number of Shares with respect to which Awards
may be granted under the Plan (other than increases related to adjustments made
as provided in Section 4(b) hereof), (B) expands the class of persons eligible
to participate under the Plan or (C) otherwise increases in any material respect
the benefits payable under the Plan; or (ii) if otherwise required by (A) the
Code or any rules promulgated thereunder (in order to allow for Incentive Stock
Options to be granted under the Plan), or (B) the listing requirements of the
New York Stock Exchange or any principal securities exchange or market on which
the Shares are then traded (in order to maintain the listing of the Shares
thereon). Termination of the Plan
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shall not affect the rights of Participating Key Employees or Non-Employee
Directors with respect to Awards previously granted to them, and all unexpired
Awards shall continue in force and effect after termination of the Plan except
as they may lapse or be terminated by their own terms and conditions.
(b) Correction of Defects, Omissions and Inconsistencies. The
Committee may correct any defect, supply any omission, or reconcile any
inconsistency in the Plan, any Award or any Award Agreement in the manner and to
the extent it shall deem desirable to carry the Plan into effect.
Section 8. General Provisions
(a) No Rights to Awards. No Key Employee, Participating Key
Employee, Non-Employee Director or other Person shall have any claim to be
granted any Award under the Plan, and there is no obligation for uniformity of
treatment of Key Employees, Participating Key Employees, Non-Employee Directors
or holders or beneficiaries of Awards under the Plan. The terms and conditions
of Awards need not be the same with respect to each Participating Key Employee
or Non-Employee Director.
(b) Withholding. No later than the date as of which tax withholding
is first required with respect to any Award under the Plan, the Participating
Key Employee shall pay to the Company, or make arrangements satisfactory to the
Company regarding the payment of, any federal, state, local or foreign taxes of
any kind required by law to be withheld with respect to such amount. Unless
otherwise determined by the Committee, withholding obligations arising with
respect to Awards to Participating Key Employees under the Plan may be settled
with Shares (other than Restricted Securities), including Shares that are part
of, or are received upon exercise of, the Award that gives rise to the
withholding requirement. The obligations of the Company under the Plan shall be
conditional on such payment or arrangements, and the Company and any Affiliate
shall, to the extent permitted by law, have the right to deduct any such taxes
from any payment otherwise due to the Participating Key Employee. The Committee
may establish such procedures as it deems appropriate for the settling of
withholding obligations with Shares, including, without limitation, the
establishment of such procedures as may be necessary to satisfy the requirements
of Rule 16b-3.
(c) No Limit on Other Compensation Arrangements. Nothing contained
in the Plan shall prevent the Company or any Affiliate from adopting or
continuing in effect other or additional compensation arrangements, and such
arrangements may be either generally applicable or applicable only in specific
cases.
(d) Rights and Status of Recipients of Awards. The grant of an Award
shall not be construed as giving a Participating Key Employee the right to be
retained in the employ of the Company or any Affiliate. Further, the Company or
any Affiliate may at any time dismiss a Participating Key
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Employee from employment, free from any liability, or any claim under the Plan,
unless otherwise expressly provided in the Plan or in any Award Agreement. The
grant of an Award to a Non-Employee Director pursuant to Section 6(a) of the
Plan shall confer no right on such Non-Employee Director to continue as a
director of the Company or any Affiliate. Except for rights accorded under the
Plan and under any applicable Award Agreement, Participating Key Employees and
Non-Employee Directors shall have no rights as holders of Shares as a result of
the granting of Awards hereunder.
(e) No Compensation for Benefit Plans. No Award payable under this
Plan shall be deemed salary or compensation for the purpose of computing
benefits under any benefit plan or other arrangement of the Company or any
Affiliate for the benefit of its employees or directors unless the Company or
appropriate Affiliate shall determine otherwise.
(f) Approval of Material Terms of Performance Goals. Notwithstanding
anything herein to the contrary, if so determined by the Board of Directors, the
Plan provisions specifying the material terms of the Plan's performance goals
(within the meaning of Code Section 162(m)) shall be submitted to the
shareowners of the Company for re-approval no later than the first shareowner
meeting that occurs in the fifth year following the year in which shareowners
previously approved such Plan provisions.
(g) Unfunded Status of the Plan. Unless otherwise determined by the
Committee, the Plan shall be unfunded and shall not create (or be construed to
create) a trust or a separate fund or funds. The Plan shall not establish any
fiduciary relationship between the Company and any Participating Key Employee,
Non-Employee Director or other Person. To the extent any Person holds any right
by virtue of a grant under the Plan, such right (unless otherwise determined by
the Committee) shall be no greater than the right of a general unsecured
creditor of the Company.
(h) Governing Law. The validity, construction, and effect of the
Plan and any rules and regulations relating to the Plan shall be determined in
accordance with the internal laws of the State of Wisconsin, without reference
to conflict of law principles thereof, and applicable federal law.
(i) Severability. If any provision of the Plan or any Award
Agreement or any Award is or becomes or is deemed to be invalid, illegal, or
unenforceable in any jurisdiction, or as to any Person or Award, or would
disqualify the Plan, any Award Agreement or any Award under any law deemed
applicable by the Committee, such provision shall be construed or deemed amended
to conform to applicable laws, or if it cannot be so construed or deemed amended
without, in the determination of the Committee, materially altering the intent
of the Plan, any Award Agreement or the Award, such provision shall be stricken
as to such jurisdiction, Person, or Award, and the remainder of the Plan, any
such Award Agreement and any such Award shall remain in full force and effect.
(j) No Fractional Shares. No fractional Shares or other securities
shall be issued or delivered pursuant to the Plan, any Award Agreement or any
Award, and the Committee shall determine (except as otherwise provided in the
Plan) whether cash, other securities, or other property shall be paid or
transferred in lieu of any fractional Shares or other securities, or whether
such fractional Shares or other securities or any rights thereto shall be
canceled, terminated, or otherwise eliminated.
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(k) Headings. Headings are given to the Sections and subsections of
the Plan solely as a convenience to facilitate reference. Such headings shall
not be deemed in any way material or relevant to the construction or
interpretation of the Plan or any provision thereof.
Section 9. Effective Date of the Plan
The Plan shall be effective on the day immediately following its
approval by the shareowners of the Company provided that such approval is
obtained within twelve months following the date of adoption of the Plan by the
Board of Directors of the Company.
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