WPL HOLDINGS, INC.
WISCONSIN POWER AND LIGHT COMPANY
HEARTLAND DEVELOPMENT CORPORATION
DEFERRED COMPENSATION PLAN FOR DIRECTORS
Adopted June 27, 1990
Amended January 17, 1995
WPL HOLDINGS, INC.
WISCONSIN POWER AND LIGHT COMPANY
HEARTLAND DEVELOPMENT CORPORATION
DEFERRED COMPENSATION PLAN FOR DIRECTORS
Section I - Definitions
The following definitions shall be applicable throughout the Deferred
Compensation Plan:
1.1 "Company" shall mean either WPL Holdings, Inc., Wisconsin Power and
Light Company, or Heartland Development Corporation.
1.2 "Board" shall mean the Board of Directors of the Company.
1.3 "Director Fees" shall mean any fees received during the Plan Year
for services rendered as a Director.
1.4 "Effective Date" shall mean June 27, 1990.
1.5 "Participant" shall mean any Director designated as eligible under
Section 3.1 who has elected, under the terms and conditions of the
Plan, to defer payments of all or allowable portions of Director
Fees.
1.6 "Participant Account" shall mean the participant's account
established pursuant to Section 4.1.
1.7 "Compensation and Personnel Committee" shall mean the Compensation
and Personnel Committee, or its equivalent, of the Board or its
designated appointee.
1.8 "Personal Representative" shall mean the person or persons who upon
the death, disability or incompetency of a Participant shall have
acquired, by will, by laws of decent and distribution or by other
legal proceedings, the right to the Participant's Account.
1.9 "Plan" shall mean this Deferred Compensation Plan.
1.10 "Plan Year" shall be the calendar year.
1.11 "Unforeseeable Emergency" means an unanticipated emergency that is
caused by an event beyond the control of the Participant or
beneficiary.
Section II - General
2.1 The purpose of this Deferred Compensation Plan is to provide
flexibility to members of the Company's Board of Directors, who are
not employees of the Company, in their receipt of Director Fees.
Section III - Eligibility and Selection of Participants
3.1 Participation in the Plan shall be limited to members of the Board
of Directors, except those Directors who are employees of the
Company.
Section IV - Election to Defer
4.1 An eligible Director may elect, under the terms and conditions of
the Plan, to defer all or an allowable portion specified under
Section 5.2 of Director Fees. Such election shall be made by
written notice in the manner specified by the Compensation and
Personnel Committee and shall be irrevocable when made except as
provided in Section 12.1.
4.2 Election to defer Director Fees shall be made prior to the first day
of each Plan Year.
4.3 In the first year in which a Participant becomes eligible to
participate in the Plan, the newly eligible Participant shall make
an election to defer compensation for services to be performed
subsequent to the election within 30 days after the date the
Participant becomes eligible.
Section V - Deferral Amount Selection
5.1 Participants of the Plan may elect to defer a percentage amount (if
any) of Director Fees.
5.2 If deferral is elected, any percentage deferral from 1% to 100%
shall be permitted.
Section VI - Intentionally Left Blank
Section VII - Manner and Timing of Distribution
7.1 Plan Participants may choose to receive payment of deferred amounts
and investment earnings by one of the alternative methods stated
hereunder:
(a) (i) one lump sum payment in any year between the current year
and the anticipated year of conclusion of membership on
the Board as specified by the Participant.
(ii) annual installments (not to exceed 10), the first of
which shall be paid commencing in the year so specified
by the Participant.
(b) Upon the anticipated conclusion of membership on the Board (or
one tax year thereafter) in either:
(i) one lump sum payment in the year so specified by the
Participant.
(ii) annual installments (not to exceed 10), the first of
which shall be paid commencing in the year so specified
by the Participant.
7.2 Plan Participants electing to receive payments of deferred amounts
and investment earnings in the manner specified in
paragraph 7.1(a)(i) and (ii) will receive the lump sum payment or
installment payment on the fourth Friday in January in the calendar
year so designated by the Participant.
7.3 Plan participants electing to receive payments of deferred amounts
and investment earnings in the manner specified in paragraph 7.1(b)
(i) and (ii) will receive payments as follows:
(a) One lump sum payment shall be paid either the fourth Friday
following the date of conclusion of membership on the Board or
on the fourth Friday of January following the year of
conclusion of membership on the Board as specified by the
Participant.
(b) Annual installments, the first of which shall be paid either on
the fourth Friday following the date of conclusion of
membership on the Board or the fourth Friday of January
following the year of conclusion of membership on the Board as
specified by the Participant. Installment payments for
subsequent years will be made on the fourth Friday in January
until all such installments have been paid.
7.4 Notwithstanding the provisions outlined in 7.1 - 7.3 above,
Participants who die or are involuntarily terminated as a member of
the Board shall receive a distribution equal to the value of their
account in a lump sum payment. Such distributions shall be made on
the fourth Friday of the month following the month in which the
Participant ceases to be a member of the Board.
Section VIII - Interest Credit to Participant Accounts
8.1 All deferred amounts credited to a Participant's Account shall be
credited interest on December 31 at a rate equivalent to the
A-Utility Bond yield (as reported in the Federal Reserve statistical
release H.15) using the average of the rates reported for the last
Friday of each month for the preceding twelve (12) calendar months.
Interest shall continue to be credited and compounded in this manner
until the final payment shall have been made from the Participant's
Account.
Partial year interest accruals for Participants who because of
financial hardship, termination or death during the Plan Year will
also be computed at a rate equivalent to the A-Utility Bond yield
(in the manner prescribed above) using the average rates from the
January 1 preceding the Participant's termination date through the
fourth Friday of the month preceding the Participant's termination
date. Interest payments will apply to amounts deferred up to the
date the plan distribution is made.
8.2 The interest credit rate determined in Section 8.1 will be applied
to the average Participant Account balance for that period.
Section IX - Rights of Participants and Forfeiture
9.1 Nothing contained in the Plan shall
(a) confer upon any Director the right to continue on the Board of
Directors, or
(b) require the Company to pay any Director Fees, except as
provided for herein, or
(c) confer upon any Director or other person any claim or right to
any distribution under the Plan except in accordance with its
terms.
9.2 No right or interest of any Participant in the Plan shall, prior to
actual payment or distribution to such Participant, be assignable or
transferable in whole or in part, either voluntarily or by operation
of law or otherwise, or be subject to payment of debts of any
Participant by execution, levy, garnishment, attachment, pledge,
bankruptcy of in any other manner.
9.3 If a Participant has elected to defer pursuant to Section 4.1 and
his or her services as a member of the Board are terminated
voluntarily or involuntarily, the Participant shall retain all
rights to the undistributed amounts credited to his or her
Participant Account.
9.4 The deferral amount and investment earnings of the plan is and shall
remain at all times subject to the claims of the general creditors
of the Company. As such, the Plan Participants have the status of
general unsecured creditors of the Company and this Plan constitutes
a mere promise by the Company to make benefit payments to
Participants in the future.
9.5 It is the intention of all parties involved that the arrangements be
unfunded for tax purposes and for purposes of title I of ERISA.
Section X - Death of Participant
10.1 Should a Participant die, the amount of such Participant's Account
shall be distributed to the Participant's Personal Representative.
Such distributions shall be made in a lump sum pursuant to
Sections 7.4, 8.1 and 8.2.
Section XI - Distribution in the Event of Financial Hardship
11.1 The Compensation and Personnel Committee may allow a partial or
total distribution of amounts in a Participant's Account upon the
Participant's request and a demonstration by the Participant of
financial hardship as a result of an Unforeseeable Emergency. The
amount of any such distribution shall be limited to the amount
deemed necessary by the Compensation and Personnel Committee to
alleviate or remedy the Participant's hardship. Such distributions
shall be made in a lump sum pursuant to Sections 8.1 and 8.2 on the
fourth Friday of the month following the month of committee
approval.
Section XII - Stopping Deferral
12.1 The Compensation and Personnel Committee may allow a Participant to
cease deferrals during the plan year on the Board meeting date
following the committee approval in response to an Unforeseeable
Emergency.
Section XIII - Distribution in the Event of Significant Change in Tax Law
13.1 Under the terms of the Deferred Compensation Plan for Directors, the
Compensation and Personnel Committee may allow payments to a
Participant before any payments would otherwise be due if the
Compensation and Personnel Committee determines, based on changes
in the Federal tax or revenue laws, a published ruling or similar
announcement issued by the Internal Revenue Service, a regulation
issued by the Secretary of the Treasury, a decision by a court of
competent jurisdiction involving a Participant or a beneficiary, or
a closing agreement made under section 7121 of the Internal Revenue
Code which has been approved by the Internal Revenue Service and
involves a Participant, that a Participant has or will recognize
income for Federal income tax purposes with respect to amounts that
are or will be payable under the Plan before such amounts are to be
paid.
Section XIV - Administration
14.1 The Compensation and Personnel Committee may from time to time
amend, suspend, terminate or reinstate any or all of the provisions
of the Plan as may seem necessary or advisable for the
administration of the Plan.
14.2 The Compensation and Personnel Committee shall, subject to express
provisions of the Plan, have power to construe the Plan, to
prescribe rules and regulations relating to the Plan and to make all
other determinations necessary or advisable for the administration
of the Plan. The Compensation and Personnel Committee may correct
any defect or supply any omission or reconcile any inconsistency in
the Plan in the manner and to the extent it shall deem expedient to
carry it into effect.
14.3 Manner of Election - The Compensation and Personnel Committee shall
ensure that all individuals entitled to make the election to defer
are provided an election form at least thirty (30) days before such
election must be made in accordance with Section 4.1 and received in
writing in order to be effective. This election form shall include
the following items, which must be completed in full in order to be
effective:
(a) The amount to be deferred, expressed as a percentage of
Director Fees to become payable during the calendar year in
question;
(b) The number of installments for the payment of the deferred
compensation; and
(c) The date of the first installment payment.
14.4 All expenses and costs incurred in connection with the
administration and operation of the Plan shall be borne by the
Company.
Section XV - Funding
15.1 Benefits under this Plan shall be paid from the general assets of
the Company. This Plan shall be administered as an unfunded plan
which is not intended to meet the qualification requirements of
Section 401 of the Internal Revenue Code.
WPL HOLDINGS, INC.
DEFERRED COMPENSATION PLAN FOR DIRECTORS
ELECTION OF DEFERMENT
In accordance with the provisions of the Deferred Compensation Plan, I
hereby elect to defer Director Fees earned by me for my services from
January 1, 19__ to December 31, 19__ as follows:
AMOUNT OF DEFERRAL
Amount of Deferral: _________________% (Percentage of Director Fees)
PAYMENT OPTIONS (Specify One)
(a) Payment in _____ (any year subsequent to the current year) according
to:
(i) lump sum payment
(ii) ____ annual installments (not to exceed 10)
(b) Upon the anticipated conclusion of my membership on the Board of
Directors (or one tax year thereafter) according to:
(i) lump sum payment in the year of anticipated conclusion of my
membership on the Board of Directors _____, or one tax year
thereafter_____ (check one).
(ii) ______ annual installments (not to exceed 10) the first of
which shall be paid commencing in the year of anticipated
conclusion of my membership on the Board of Directors ____, or
one tax year thereafter _____ (check one).
I hereby agree to be bound by the terms of the Plan, including any
amendment thereof, and recognize that the foregoing election is
irrevocable and may not be altered by me.
___________________________________
Signature of Director Date
Received on behalf of WPL Holdings, Inc.
By: _________________________________
Date: ______________________
Return to Corporate Secretary by December 31.