ALLIANT ENERGY CORPORATION
2002 EQUITY INCENTIVE PLAN
NONQUALIFIED STOCK OPTION AGREEMENT
THIS AGREEMENT, made and entered into as of this ______ day of
________________, 20__, by and between Alliant Energy Corporation, a Wisconsin
corporation (the "Company"), and _____________________________ (the "Optionee").
W I T N E S S E T H :
WHEREAS, the Company has adopted the Alliant Energy Corporation 2002
Equity Incentive Plan (the "Plan"), the terms of which, to the extent not stated
herein, are specifically incorporated by reference in this Agreement (defined
terms used herein which are not otherwise defined shall have the meaning set
forth in the Plan);
WHEREAS, one of the purposes of the Plan is to permit the grant of
various equity-based incentive awards, including options to purchase shares of
the Company's Common Stock, $.01 par value (the "Common Stock"), to certain Key
Employees of the Company and its Affiliates;
WHEREAS, the Optionee is now employed by the Company or an Affiliate
of the Company in a key capacity and has exhibited judgment, initiative and
efforts which have contributed materially to the successful performance of the
Company or its Affiliates; and
WHEREAS, the Company desires the Optionee to remain as an employee of
the Company or its Affiliates, and wishes to provide the Optionee with the
opportunity to secure or increase his or her stock ownership in the Company in
order to develop even a stronger incentive to put forth maximum effort for the
continued success and growth of the Company.
NOW, THEREFORE, in consideration of the premises and of the covenants
and agreements herein set forth, the parties hereby mutually covenant and agree
as follows:
1. Grant of Option. Subject to the terms and conditions of the Plan
and this Agreement, the Company grants to the Optionee an option (the "Option")
to purchase from the Company all or any part of the aggregate amount of
___________ shares of Common Stock (the "Optioned Shares"). The Option is
intended to constitute a nonqualified stock option and shall not be treated as
an incentive stock option within the meaning of Section 422 of the Internal
Revenue Code of 1986, as amended.
2. Option Price. The price to be paid for the Optioned Shares shall be
$______ per share, which has been determined by the Compensation and Personnel
Committee of the Board of Directors of the Company (together with any successor
committee that may administer the Plan, the "Committee") to be not less than
100% of the fair market value of a share of such stock on the date of grant of
the Option (determined based on the average of the high and low sales prices for
the Common Stock, as reported on the New York Stock Exchange on the trading day
immediately prior to the date of grant).
3. Exercisability and Termination of Option. Except as provided
herein, the Option may be exercised only while the Optionee is an employee of
the Company or an Affiliate of the Company and only if the Optionee has been
continuously affiliated with the Company or any of its Affiliates since the date
of grant of the Option. The Option may be exercised by the Optionee in whole, or
in part from time to time, during the period beginning January 1, 20__, and
ending __________, ____ (the "Expiration Date"), but (subject to Paragraphs 6
and 7) only in accordance with the following schedule:
Cumulative Percentage of Shares Subject to
Option Which May be Purchased (which
number of shares shall be rounded
Period down to the nearest whole number)
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Prior to January 1, 20__ 0%
January 1, 20__ to December 31, 20__ 33-1/3%
January 1, 20__ to December 31, 20__ 66-2/3%
January 1, 20__ to Expiration Date 100%
4. Manner of Exercise and Payment. Subject to the provisions of
Paragraph 3 hereof, the Option may be exercised only by written notice to the
Company, served upon the Corporate Secretary of the Company at its office at
4902 North Biltmore Lane, Madison, Wisconsin 53718-2132, specifying the number
of shares in respect to which the Option is being exercised. Subject to the
provisions of this Agreement, the notice of exercise must be accompanied by full
payment of the option price of the shares being purchased (i) in cash or by
certified check or bank draft; (ii) by tendering previously acquired shares of
Common Stock (valued at their "fair market value" as determined in the manner
provided below); or (iii) by any combination of the means of payment set forth
in subparagraphs (i) and (ii). For purposes of this Paragraph 4, the "fair
market value" of a share of Common Stock shall be equal to the average of the
high and low sales prices for the Common Stock, as reported on the New York
Stock Exchange on the trading date next preceding the date of exercise, or, if
no trading occurred on the trading date next preceding the exercise date, then
the "fair market value" per share of Common Stock shall be determined with
reference to the next preceding date on which the Common Stock was traded. For
purposes of subparagraphs (ii) and (iii) above, the term "previously acquired
shares of Common Stock" shall only include Common Stock owned by the Optionee
prior to the exercise of the Option and shall not include shares of Common Stock
which are being acquired pursuant to the exercise of the Option. No shares shall
be issued until full payment therefor has been made.
5. Nontransferability of the Option. The Option shall not be
assignable, alienable, saleable or transferable by the Optionee other than by
will or the laws of descent and distribution; provided, however, that the
Optionee shall be entitled, in the manner provided in Paragraph 9 hereof, to
designate a beneficiary to exercise his or her rights, and to receive any shares
of Common Stock issuable, with respect to the Option upon the death of the
Optionee. The
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Option may be exercised during the lifetime of the Optionee only by the Optionee
or, if permitted by applicable law, the Optionee's guardian or legal
representative.
6. Exercisability After Termination of Employment.
(a) Death or Disability; Retirement. In the event the
Optionee dies while he or she is an employee of the Company or any
Affiliate or if his or her employment is terminated by reason of his
or her disability, as defined in the Alliant Energy Cash Balance
Pension Plan, the Option shall immediately vest one hundred percent
(100%) and, to the extent not theretofore exercised, may be exercised
in full as follows: (i) by the legal representative of the Optionee
(who for purposes of this Agreement may be the Optionee's beneficiary
as designated pursuant to Paragraph 9) at any time within twelve
months after the date of the Optionee's death while an employee of the
Company or any Affiliate; or (ii) by the Optionee or his or her legal
representative or guardian at any time within twelve months after the
termination of the Optionee's employment by reason of disability, but
in either case in no event later than the Expiration Date. In the
event the Optionee's employment is terminated by reason of his or her
retirement after satisfying the minimum requirements for eligibility
to receive an "Early Retirement Benefit" under the Alliant Energy Cash
Balance Pension Plan ("Retirement"), the Option shall immediately vest
one hundred percent (100%) and, to the extent not theretofore
exercised, may be exercised in full by the Optionee or by his or her
legal representative or guardian at any time within three years after
termination of the Optionee's employment by reason of Retirement, but
in no event later than the Expiration Date. In the event the
Optionee's employment is terminated by reason of his or her Retirement
or by reason of his or her disability, as defined in the Alliant
Energy Cash Balance Pension Plan, and within the subsequent exercise
period the Optionee dies, the Option, to the extent not theretofore
exercised, may be exercised in full by the Optionee's legal
representative or guardian at any time within the longer of one year
following death or the remainder of the expiration period triggered by
the termination of employment, but in no event later than the
Expiration Date.
(b) For Cause. If the employment of the Optionee is
terminated by the Company or any Affiliate for Cause, the Option, to
the extent not theretofore exercised, shall immediately be forfeited
to the Company and no additional exercise period shall be allowed,
regardless of the vested status of the Option. For purposes of this
Agreement "Cause" means the admission by or the conviction of the
Optionee of an act of fraud, embezzlement, theft or other criminal act
constituting a felony under U.S. laws involving moral turpitude. The
Board of Directors of the Company (the "Board"), by majority vote,
shall make the determination of whether Cause exists.
(c) Other. In the event that the Optionee is discharged or
leaves the employ of the Company or its Affiliates for any reason
(other than the death, disability or Retirement of the Optionee as
contemplated by Paragraph 6(a) above or for Cause as contemplated by
Paragraph 6(b) above), the Option, to the extent not theretofore
exercised but then permitted (as of the date of termination) under the
percentage limitations of Paragraph 3 hereof, may be exercised by the
Optionee or by his or her legal representative or guardian at any time
within three months after the date of termination of employment
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upon the tender to the Company, in cash or its equivalent, of the full purchase
price, but in no event later than the Expiration Date.
7. Change in Control.
(a) Immediately Exercisable. If a "Change in Control"
occurs, all outstanding Options under this Agreement shall vest and
become immediately exercisable.
(b) Definition. For purposes of this Agreement, "Change in
Control" means the occurrence of any one of the events set forth in
the following paragraphs:
(i) any Person (other than (A) the Company or any
subsidiary of the Company (each a "Subsidiary"), (B) a
trustee or other fiduciary holding securities under any
employee benefit plan of the Company or any Subsidiary, (C)
an underwriter temporarily holding securities pursuant to an
offering of such securities or (D) a corporation owned,
directly or indirectly, by the shareowners of the Company in
substantially the same proportions as their ownership of
stock in the Company ("Excluded Persons")) is or becomes the
beneficial owner, directly or indirectly, of securities of
the Company (not including in the securities beneficially
owned by such Person any securities acquired directly from
the Company or its Affiliates after [grant date], pursuant
to express authorization by the Board that refers to this
exception) representing 20% or more of either the then
outstanding shares of Common Stock or the combined voting
power of the Company's then outstanding voting securities;
or
(ii) the following individuals cease for any
reason to constitute a majority of the number of directors
of the Company then serving: (A) individuals who, on [grant
date], constituted the Board and (B) any new director (other
than a director whose initial assumption of office is in
connection with an actual or threatened proxy or consent
solicitation for purpose of opposing a solicitation by the
Company relating to the election of directors of the
Company), whose appointment or election by the Board or
nomination for election by the Company's shareowners was
approved by a vote of at least two-thirds (2/3) of the
directors then still in office who either were directors on
[grant date], or whose appointment, election or nomination
for election was previously so approved (collectively the
"Continuing Directors"); provided, however, that individuals
who are appointed to the Board pursuant to or in accordance
with the terms of an agreement relating to a merger,
consolidation, or share exchange involving the Company (or
any Subsidiary) shall not be Continuing Directors for
purposes of this Agreement until after such individuals are
first nominated for election by a vote of at least
two-thirds (2/3) of the then Continuing Directors and are
thereafter elected as directors by the shareowners of the
Company at a meeting of shareowners held following
consummation of such merger, consolidation or share
exchange; and, provided further, that in the event the
failure of any such Persons appointed to the Board to be
Continuing Directors results in a Change in Control, the
subsequent qualification of such Persons as Continuing
Directors shall not alter the fact that a Change in Control
occurred; or
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(iii) the Company after [grant date] consummates a
merger, consolidation or share exchange with any other
corporation or issues voting securities in connection with a
merger, consolidation or share exchange involving the
Company (or any Subsidiary), other than (A) a merger,
consolidation or share exchange which results in the voting
securities of the Company outstanding immediately prior to
such merger, consolidation or share exchange continuing to
represent (either by remaining outstanding or by being
converted into voting securities of the surviving entity or
any parent thereof) at least 50% of the combined voting
power of the voting securities of the Company or such
surviving entity or any parent thereof outstanding
immediately after such merger, consolidation or share
exchange, or (B) a merger, consolidation or share exchange
effected to implement a recapitalization of the Company (or
similar transaction) in which no Person (other than an
Excluded Person) is or becomes the beneficial owner,
directly or indirectly, of securities of the Company (not
including in the securities beneficially owned by such
Person any securities acquired directly from the Company or
its Affiliates after [grant date], pursuant to express
authorization by the Board that refers to this exception)
representing 20% or more of either the then outstanding
shares of Common Stock or the combined voting power of the
Company's then outstanding voting securities; or
(iv) the shareowners of the Company approve a plan
of complete liquidation or dissolution of the Company or the
Company effects a sale or disposition of all or
substantially all of its assets (in one transaction or a
series of related transactions within any period of 24
consecutive months), other than a sale or disposition by the
Company of all or substantially all of the Company's assets
to an entity at least 75% of the combined voting power of
the voting securities of which are owned by Persons in
substantially the same proportions as their ownership of the
Company immediately prior to such sale.
Notwithstanding the foregoing, no "Change in Control" shall be deemed
to have occurred if there is consummated any transaction or series of integrated
transactions immediately following which the record holders of the shares of
Common Stock immediately prior to such transaction or series of transactions
continue to own, directly or indirectly, in the same proportions as their
ownership in the Company, an entity that owns all or substantially all of the
assets or voting securities of the Company immediately following such
transaction or series of transactions.
8. Tax Withholding. The Company may deduct and withhold from any cash
otherwise payable to the Optionee (whether payable as salary, bonus or other
compensation) such amount as may be required for the purpose of satisfying the
Company's obligation to withhold Federal, state or local taxes. Further, in the
event the amount so withheld is insufficient for such purpose, the Company may
require that the Optionee pay to the Company upon its demand or otherwise make
arrangements satisfactory to the Company for payment of such amount as may be
requested by the Company in order to satisfy its obligation to withhold any such
taxes.
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The Optionee shall be permitted to satisfy the Company's tax
withholding requirements by making a written election (in accordance with such
rules and regulations and in such form as the Committee may determine) to have
the Company withhold shares of Common Stock otherwise issuable to the Optionee
(the "Withholding Election") having a fair market value (as defined in a manner
similar to Paragraph 4) on the date income is recognized (the "Tax Date")
pursuant to the exercise of the Option equal to the minimum amount required to
be withheld. If the number of shares of Common Stock withheld to satisfy
withholding tax requirements shall include a fractional share, the number of
shares withheld shall be reduced to the next lower whole number and the Optionee
shall deliver cash in lieu of such fractional share, or otherwise make
arrangements satisfactory to the Company for payment of such amount. A
Withholding Election must be received by the Corporate Secretary of the Company
on or prior to the Tax Date.
9. Designation of Beneficiary.
(a) The person whose name appears on the signature page
hereof after the caption "Beneficiary" or any successor designated by
the Optionee in accordance herewith (the person who is the Optionee's
beneficiary at the time of his or her death is herein referred to as
the "Beneficiary") shall be entitled to exercise the Option, to the
extent it is exercisable, after the death of the Optionee. The
Optionee may from time to time revoke or change his or her beneficiary
without the consent of any prior beneficiary by filing a new
designation with the Committee. The last such designation received by
the Committee shall be controlling; provided, however, that no
designation, or change or revocation thereof, shall be effective
unless received by the Committee prior to the Optionee's death, and in
no event shall any designation be effective as of a date prior to such
receipt.
(b) If no such Beneficiary designation is in effect at the
time of the Optionee's death, or if no designated Beneficiary survives
the Optionee or if such designation conflicts with law, the Optionee's
estate acting through his or her legal representative shall be
entitled to exercise the Option, to the extent it is exercisable after
the death of the Optionee. If the Committee is in doubt as to the
right of any person to exercise the Option, the Company may refuse to
recognize such exercise, without liability for any interest or
dividends on the Optioned Shares, until the Committee determines the
person entitled to exercise the Option, or the Company may apply to
any court of appropriate jurisdiction and such application shall be a
complete discharge of the liability of the Company therefor.
10. Transfer Restriction. The shares of Common Stock to be acquired
upon exercise of the Option may not be sold or offered for sale except pursuant
to an effective registration statement under the Securities Act of 1933, as
amended, or in a transaction which, in the opinion of counsel for the Company,
is exempt from the registration provisions of said Act.
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11. Status of Optionee. The Optionee shall not be deemed for any
purposes to be a shareowner of the Company with respect to any of the Optioned
Shares except to the extent that the Option shall have been exercised with
respect thereto, the shares shall have been fully paid, and a stock certificate
issued therefor. Neither the Plan nor the Option shall confer upon the Optionee
any right to continue in the employ of the Company or any of its Affiliates, nor
to interfere in any way with the right of the Company to terminate the
employment of the Optionee at any time.
12. Powers of the Company Not Affected. The existence of the Option
shall not affect in any way the right or power of the Company or its shareowners
to make or authorize any or all adjustments, recapitalizations, reorganizations
or other changes in the Company's capital structure or its business, or any
merger or consolidation of the Company, or any issuance of bonds, debentures,
preferred or prior preference stock senior to or affecting the Common Stock or
the rights thereof, or dissolution or liquidation of the Company, or any sale or
transfer of all or any part of the Company's assets or business or any other
corporate act or proceeding, whether of a similar character or otherwise.
13. Interpretation by Committee. As a condition of the granting of the
Option, the Optionee agrees, for himself or herself and his or her legal
representatives or guardians, that this Agreement shall be interpreted by the
Committee and that any interpretation by the Committee of the terms of this
Agreement and any determination made by the Committee pursuant to this Agreement
shall be final, binding and conclusive.
14. Miscellaneous.
(a) This Agreement shall be governed and construed in
accordance with the internal laws of the State of Wisconsin applicable
to contracts made and to be performed therein between residents
thereof.
(b) This Agreement may not be amended or modified except by
the written consent of the parties hereto.
(c) The captions of this Agreement are inserted for
convenience of reference only and shall not be taken into account in
construing this Agreement.
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IN WITNESS WHEREOF, the Company has caused this instrument to be
executed by its duly authorized officers and its corporate seal to be hereunto
affixed, and the Optionee has hereunto affixed his or her hand and seal as of
the day and year first above written.
ALLIANT ENERGY CORPORATION
By:
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Name:
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Title:
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OPTIONEE
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Name:
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SSN:
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Beneficiary:
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Address:
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SSN or TIN:
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