Exhibit 10.1





                           ALLIANT ENERGY CORPORATION

                         LONG-TERM EQUITY INCENTIVE PLAN
                                   AS AMENDED

Article 1.   Establishment, Purpose, and Duration

         1.1 Establishment of the Plan. Alliant Energy Corporation,  a Wisconsin
corporation  (hereinafter  referred to as the "Company"),  hereby establishes an
incentive  compensation  plan to be known  as the  "Alliant  Energy  Corporation
Long-Term Equity Incentive Plan" (hereinafter referred to as the "Plan"), as set
forth in this  document.  The Plan  permits  the  grant  of  Nonqualified  Stock
Options,  Incentive Stock Options,  Restricted  Stock,  Performance  Units,  and
Performance  Shares.  The Plan  became  effective  as of January  23,  1994 (the
"Effective Date"), and shall remain in effect as provided in Section 1.3 herein.

         1.2  Purpose of the Plan.  The  purpose  of the Plan is to promote  the
success and enhance the value of the Company by linking the  personal  interests
of Participants to those of Company shareowners,  and by providing  Participants
with an incentive for outstanding  performance.  The Plan is further intended to
provide  flexibility  to the Company in its ability to  motivate,  attract,  and
retain the services of Participants upon whose judgment,  interest,  and special
effort the successful conduct of its operation largely is dependent.

         1.3 Duration of the Plan. The Plan commenced on the Effective  Date, as
described  in Section 1.1  herein,  and shall  remain in effect,  subject to the
right of the Board of Directors to  terminate  the Plan at any time  pursuant to
Article 13 herein,  until all Shares  subject to it shall have been purchased or
acquired according to the Plan's provisions.  However,  in no event may an Award
be granted under the Plan on or after January 22, 2004.

Article 2.   Definitions

         Whenever used in the Plan, the following  terms shall have the meanings
set forth below and,  when the meaning is  intended,  the initial  letter of the
word is capitalized:

         (a)      "Award" means,  individually  or  collectively,  a grant under
                  this  Plan of  Nonqualified  Stock  Options,  Incentive  Stock
                  Options,  Restricted Stock,  Performance Units, or Performance
                  Shares.

         (b)      "Award  Agreement"  means an  agreement  entered  into by each
                  Participant  and the  Company  setting  forth  the  terms  and
                  provisions  applicable to Awards granted to Participants under
                  this Plan.

         (c)      "Beneficial  Owner"  shall have the  meaning  ascribed to such
                  term in Rule 13d-3 of the General Rules and Regulations  under
                  the Exchange Act; provided,  however,  that a Person shall not
                  be deemed the Beneficial Owner of, or to beneficially own, any
                  security  as  a  result  of  an  agreement,   arrangement   or
                  understanding   to  vote  such  security  if  the   agreement,
                  arrangement  or  understanding:   (i)  arises  solely  from  a
                  revocable proxy or consent given to such Person in response to
                  a public proxy or consent  solicitation  made pursuant to, and
                  in accordance with, the applicable rules
<PAGE>


                  and  regulations  under the  Exchange Act and (ii) is not also
                  then reportable on Schedule 13D under the Exchange Act (or any
                  comparable or successor report).

         (d)      "Board" or "Board of  Directors"  means the Board of Directors
                  of the Company.

         (e)      "Cause"  means  the  admission  by or  the  conviction  of the
                  Participant 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,  by majority  vote,
                  shall make the determination of whether Cause exists.

         (f)      "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,  (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 January 20, 1999,
                           pursuant to express  authorization  by the Board that
                           refers to this exception) representing 20% or more of
                           either the then  outstanding  Shares 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
                           January 20, 1999,  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  election  contest,  including but not
                           limited to a consent  solicitation,  relating  to the
                           election of Directors  of the Company,  as such terms
                           are used in Rule 14a-11 of  Regulation  14A under the
                           Exchange  Act) 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 January 20, 1999,
                           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 the
                           Plan 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

                                      -2-
<PAGE>

                           qualification of such Persons as Continuing Directors
                           shall not  alter  the fact  that a Change in  Control
                           occurred; or

                  (iii)    the Company  after  January 20,  1999  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 January 20, 1999,
                           pursuant to express  authorization  by the Board that
                           refers to this exception) representing 20% or more of
                           either the then  outstanding  Shares 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  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.

         (g)      "Code"  means the Internal  Revenue  Code of 1986,  as amended
                  from time to time.

         (h)      "Committee"  means the  committee,  as specified in Article 3,
                  appointed by the Board to administer the Plan.

         (i)      "Company"  means  Alliant  Energy  Corporation,   a  Wisconsin
                  corporation,  or any successor  thereto as provided in Article
                  16 herein.

                                      -3-
<PAGE>

         (j)      "Director"  means any  individual who is a member of the Board
                  of Directors of the Company.

         (k)      "Disability"  shall have the meaning  ascribed to such term in
                  the Alliant Energy Cash Balance Plan.

         (l)      "Dividend  Equivalent"  means a  contingent  right  to be paid
                  dividends  declared with respect to outstanding Option grants,
                  pursuant to the terms of Section 6.5 herein.

         (m)      "Employee"  means any  nonunion  employee of the Company or of
                  the  Company's  Subsidiaries.  Directors who are not otherwise
                  employed  by the  Company  shall not be  considered  Employees
                  under this Plan.

         (n)      "Exchange Act" means the  Securities  Exchange Act of 1934, as
                  amended from time to time, or any successor Act thereto.

         (o)      "Fair Market  Value" means the Fair Market Value of the Shares
                  determined   by  such  methods  or   procedures  as  shall  be
                  established  from  time to time  by the  Committee;  provided,
                  however,  that so long as the  Shares  are  traded in a public
                  market,  Fair  Market  Value means the average of the high and
                  low prices of a Share in the  principal  market for the Shares
                  on the specified  date (or, if no sales occurred on such date,
                  the last preceding date on which sales occurred).

         (p)      "Incentive  Stock Option" or "ISO" means an option to purchase
                  Shares, granted under Article 6 herein, which is designated as
                  an  Incentive  Stock  Option  and  is  intended  to  meet  the
                  requirements  of  Section  422 of the Code,  or any  successor
                  provision thereto.

         (q)      "Named  Executive  Officer" means a Participant who, as of the
                  date of vesting and/or payout of an Award, is one of the group
                  of "covered  employees,"  as defined in Section  162(m) of the
                  Code and the regulations promulgated thereunder.

         (r)      "Nonqualified  Stock  Option"  or  "NQSO"  means an  option to
                  purchase Shares,  granted under Article 6 herein, which is not
                  an Incentive Stock Option.

         (s)      "Option"  means an Incentive  Stock  Option or a  Nonqualified
                  Stock Option.

         (t)      "Option  Price"  means  the  price  at  which a  Share  may be
                  purchased  by  a  Participant   pursuant  to  an  Option,   as
                  determined by the Committee.

         (u)      "Participant"  means an Employee who has  outstanding an Award
                  granted under the Plan.

         (v)      "Performance  Unit" means an Award granted to an Employee,  as
                  described in Article 8 herein.

         (w)      "Performance Share" means an Award granted to an Employee,  as
                  described in Article 8 herein.

                                      -4-
<PAGE>

         (x)      "Period  of  Restriction"  means the period  during  which the
                  transfer of Shares of Restricted  Stock is limited in some way
                  (based on the passage of time, the  achievement of performance
                  goals,  or the occurrence of other events as determined by the
                  Committee, at its discretion), and the Shares are subject to a
                  substantial  risk of  forfeiture,  as  provided  in  Article 7
                  herein.

         (y)      "Person"  shall  have the  meaning  ascribed  to such  term in
                  Section 3(a)(9) of the Exchange Act and used in Sections 13(d)
                  and 14(d)  thereof,  including a "group" as defined in Section
                  13(d).

         (z)      "Restricted  Stock"  means an Award  granted to a  Participant
                  pursuant to Article 7 herein.

         (aa)     "Retirement"  shall have the meaning  ascribed to such term in
                  the Alliant Energy Cash Balance Plan.

         (ab)     "Shares" means the shares of common stock of the Company.

         (ac)     "Subsidiary" means any corporation,  partnership,  venture, or
                  other entity in which the Company, directly or indirectly, has
                  at least an eighty percent (80%) ownership interest.

Article 3.   Administration

         3.1 The Committee.  The Plan shall be administered by the  Compensation
and Personnel  Committee of the Board or by any other Committee appointed by the
Board  consisting  of not  less  than  two (2)  Directors.  The  members  of the
Committee  shall be  appointed  from  time to time by,  and  shall  serve at the
discretion of, the Board of Directors.  The Committee shall be comprised  solely
of  Directors  who qualify as  "Non-Employee  Directors"  pursuant to Rule 16b-3
under the Exchange Act and as "outside  directors" pursuant to Section 162(m) of
the Code and the regulations thereunder.

         3.2 Authority of the  Committee.  The  Committee  shall have full power
except as limited by law or by the  Articles of  Incorporation  or Bylaws of the
Company,  and subject to the  provisions  herein,  to designate  Employees to be
Participants  in the  Plan;  to  determine  the size and  types  of  Awards;  to
determine the terms and  conditions of such Awards in a manner  consistent  with
the Plan; to determine whether,  to what extent,  and under what  circumstances,
Awards granted to  Participants  may be settled or exercised in cash,  Shares or
other  property;  to  construe  and  interpret  the  Plan and any  agreement  or
instrument entered into under the Plan; to establish,  amend, or waive rules and
regulations  for the Plan's  administration;  and (subject to the  provisions of
Article 13 herein) to amend the terms and conditions of any outstanding Award to
the extent such terms and  conditions are within the discretion of the Committee
as  provided  in  the  Plan.  Further,   the  Committee  shall  make  all  other
determinations which may be necessary or advisable for the administration of the
Plan.  As permitted  by law, the  Committee  may  delegate  its  authorities  as
identified hereunder.

         3.3 Decisions  Binding.  All  determinations  and decisions made by the
Committee  pursuant  to the  provisions  of the Plan and all  related  orders or
resolutions of the Board shall be final, conclusive, and binding on all persons,
including  the Company,  its  shareowners,  Employees,  Participants,  and their
estates and beneficiaries.

                                      -5-
<PAGE>

Article 4.   Shares Subject to the Plan

         4.1 Number of Shares.  Subject to adjustment as provided in Section 4.3
herein,  the total number of Shares  available for grant under the Plan shall be
3,800,000.  Of this  number,  up to 400,000  Shares  (subject to  adjustment  as
provided in Section 4.3 herein) may be granted as Restricted Stock. These Shares
may be either authorized but unissued or reacquired  Shares. The following rules
will apply for purposes of the  determination  of the number of Shares available
for grant under the Plan:

         (a)      While an Award is outstanding, it shall be counted against the
                  authorized pool of Shares, regardless of its vested status.

         (b)      The grant of an Option or  Restricted  Stock shall  reduce the
                  Shares  available  for grant  under the Plan by the  number of
                  Shares subject to such Award.

         (c)      The Committee  shall in each case  determine  the  appropriate
                  number  of  Shares  to  deduct  from  the  authorized  pool in
                  connection   with  the  grant  of  Performance   Units  and/or
                  Performance Shares.

         (d)      Unless otherwise determined by the Committee,  the grant of an
                  award  opportunity  under  Article  8 of this  Plan  shall not
                  reduce the authorized pool; provided,  however, that payout of
                  such  opportunity  in the  form of  Shares  shall  reduce  the
                  authorized pool by such number of Shares.

         (e)      To the extent  that an Award is settled in cash rather than in
                  Shares,  the authorized  Share pool shall be credited with the
                  appropriate   number  of  Shares   represented   by  the  cash
                  settlement of the Award,  as determined at the sole discretion
                  of the Committee.

         4.2 Lapsed  Awards.  If any Award  granted under this Plan is canceled,
terminates,  expires, or lapses for any reason, any Shares subject to such Award
again shall be available for the grant of an Award under the Plan.

         4.3  Adjustments  in  Authorized  Shares.  In the event of any  merger,
reorganization,   consolidation,   recapitalization,   repurchase,   separation,
liquidation,   stock  dividend,  share  exchange,   split-up,   spin-off,  Share
combination, or other change in the corporate structure of the Company affecting
the Shares,  such adjustment shall be made in the number and class of securities
which may be  delivered  under the Plan,  and in the  number and class of and/or
price of securities subject to outstanding Awards granted under the Plan, as may
be determined to be  appropriate  and  equitable by the  Committee,  in its sole
discretion,  to prevent  dilution or  enlargement  of rights;  provided that the
number of securities  subject to any Award shall always be a whole  number;  and
provided further that the Committee may, in its sole discretion,  limit any such
adjustment  in order to  qualify  a  transaction  in which  the  Company  or any
affiliate is a party for pooling-of-interests accounting treatment.

Article 5.   Eligibility and Participation

         5.1  Eligibility.  Persons eligible to participate in this Plan include
all active Employees of the Company and its  Subsidiaries,  as determined by the
Committee,  including  Employees  who are  members of the Board,  but  excluding
Directors who are not Employees.

                                      -6-
<PAGE>

         5.2 Actual  Participation.  Subject to the  provisions of the Plan, the
Committee may, from time to time,  select from all eligible  Employees  those to
whom Awards shall be granted and shall  determine  the nature and amount of each
Award.

Article 6.   Stock Options

         6.1 Grant of Options.  Subject to the terms and provisions of the Plan,
Options may be granted to  Employees  at any time and from time to time as shall
be  determined  by  the  Committee.  The  Committee  shall  have  discretion  in
determining the number of Shares subject to Options granted to each Participant;
provided,  however,  that the maximum  number of Shares subject to Options which
may be granted to any single  Participant during the term of the Plan is 300,000
(subject to  adjustment  as provided in Section 4.3 herein).  The  Committee may
grant ISOs, NQSOs, or a combination thereof.

         6.2 Award  Agreement.  Each Option grant shall be evidenced by an Award
Agreement that shall specify the Option Price,  the duration of the Option,  the
number of Shares to which the Option pertains,  and such other provisions as the
Committee  shall  determine.  The Award Agreement also shall specify whether the
Option is  intended  to be an ISO within the meaning of Section 422 of the Code,
or a NQSO  whose  grant is  intended  not to fall under the Code  provisions  of
Section 422.

         6.3 Option  Price.  The Option  Price for each grant of an Option under
this  Section 6.3 shall be at least equal to one hundred  percent  (100%) of the
Fair Market Value of a Share on the date the Option is granted. In addition, the
Committee  may grant  Options  which have Option Prices that increase over time,
upon such terms as the Committee, in its sole discretion, deems appropriate.

         6.4  Duration of Options.  Each Option shall expire at such time as the
Committee  shall  determine  at the time of grant;  provided,  however,  that no
Option shall be exercisable later than the tenth (10th)  anniversary date of its
grant.

         6.5 Dividend Equivalents. Simultaneous with the grant of an Option, the
Participant receiving the Option may be granted, at no additional cost, Dividend
Equivalents. Each Dividend Equivalent shall entitle the Participant to receive a
contingent right to be paid an amount equal to the dividends declared on a Share
on all record  dates  occurring  during the period  between the grant date of an
Option and the date as specified by the Committee.  The underlying value of each
Dividend Equivalent shall accrue as a book entry in the name of each Participant
holding  the  Dividend  Equivalent.  Payout of the  accrued  value of a Dividend
Equivalent shall occur only pursuant to the terms and conditions as specified by
the Committee.

         6.6  Exercise  of  Options.  Options  granted  under the Plan  shall be
exercisable at such times and be subject to such  restrictions and conditions as
the  Committee  shall in each instance  approve,  which need not be the same for
each grant or for each Participant.

         6.7  Payment.  Options  shall be exercised by the delivery of a written
notice of  exercise  to the  Company,  setting  forth the number of Shares  with
respect to which the Option is to be exercised,  accompanied by full payment for
the Shares. The Option Price upon exercise of any Option shall be payable to the
Company  in full  either:  (a) in cash or its  equivalent,  or (b) by  tendering
previously  acquired Shares having an aggregate Fair Market Value at the time of
exercise  equal to the total Option Price,  or (c) by a  combination  of (a) and
(b).

                                      -7-
<PAGE>

         Notwithstanding  the  foregoing,  the Committee also may allow cashless
exercises as permitted under Federal  Reserve  Board's  Regulation T, subject to
such procedures as the Committee may deem appropriate.

         As soon as  practicable  after  receipt  of a written  notification  of
exercise and full payment, the Company shall deliver to the Participant,  in the
Participant's  name, Share  certificates in an appropriate amount based upon the
number of Shares purchased under the Option(s).

         6.8 Termination of Employment Due to Death, Disability, or Retirement.

         (a)      Termination  by  Death.  In  the  event  the  employment  of a
                  Participant is terminated by reason of death,  all outstanding
                  Options granted to that Participant shall immediately vest one
                  hundred  percent (100%),  and shall remain  exercisable at any
                  time prior to their expiration date, or for one (1) year after
                  the date of death, whichever period is shorter, by such person
                  or  persons  as shall  have  been  named as the  Participant's
                  beneficiary,  or  by  such  persons  that  have  acquired  the
                  Participant's  rights  under the Option by will or by the laws
                  of descent and distribution.

         (b)      Termination  by  Disability.  In the event the employment of a
                  Participant  is  terminated  by  reason  of  Disability,   all
                  outstanding   Options  granted  to  that   Participant   shall
                  immediately vest one hundred percent (100%) as of the date the
                  Committee determines the definition of Disability to have been
                  satisfied,  and shall remain  exercisable at any time prior to
                  their expiration date, or for one (1) year after the date that
                  the Committee  determines the definition of Disability to have
                  been satisfied, whichever period is shorter.

         (c)      Termination  by  Retirement.  In the event the employment of a
                  Participant  is  terminated  by  reason  of  Retirement,   all
                  outstanding   Options  granted  to  that   Participant   shall
                  immediately vest one hundred percent (100%),  and shall remain
                  exercisable at any time prior to their expiration date, or for
                  three  (3)  years  after  the  effective  date of  Retirement,
                  whichever period is shorter.

         (d)      Employment  Termination Followed by Death. In the event that a
                  Participant's employment terminates by reason of Disability or
                  Retirement,  and within the  exercise  period  following  such
                  termination the Participant dies, then the remaining  exercise
                  period under  outstanding  Options  shall equal the longer of:
                  (i) one (1)  year  following  death;  or  (ii)  the  remaining
                  portion of the  exercise  period  which was  triggered  by the
                  employment  termination.  Such Options shall be exercisable by
                  such  person  or  persons  who shall  have  been  named as the
                  Participant's  beneficiary,   or  by  such  persons  who  have
                  acquired the Participant's  rights under the Option by will or
                  by the laws of descent and distribution.

         (e)      Exercise  Limitations  on ISOs.  In the case of ISOs,  the tax
                  treatment  prescribed under Section 422 of the Code may not be
                  available if the Options are not exercised  within the Section
                  422 prescribed time periods after each of the various types of
                  employment termination.

         6.9 Termination of Employment for Other Reasons. If the employment of a
Participant  shall  terminate for any reason other than the reasons set forth in
Section 6.8 (and other than for  Cause),


                                      -8-
<PAGE>

all Options  held by the  Participant  which are not vested as of the  effective
date of  employment  termination  immediately  shall be forfeited to the Company
(and shall once again become available for grant under the Plan).  However,  the
Committee, in its sole discretion,  shall have the right to immediately vest all
or any portion of such Options,  subject to such terms as the Committee,  in its
sole discretion, deems appropriate.

         Options  which  are  vested  as of the  effective  date  of  employment
termination may be exercised by the Participant  within the period  beginning on
the effective date of employment termination,  and ending three (3) months after
such date.

         If the  employment of a Participant  shall be terminated by the Company
for Cause, all outstanding Options held by the Participant  immediately shall be
forfeited  to the Company and no  additional  exercise  period shall be allowed,
regardless of the vested status of the Options.

         6.10 Nontransferability of Options. Except as otherwise provided by the
Committee, no Option granted under the Plan may be sold,  transferred,  pledged,
assigned,  or otherwise alienated or hypothecated,  other than by will or by the
laws of descent and distribution.  Further,  except as otherwise provided by the
Committee,  all  Options  granted  to a  Participant  under  the  Plan  shall be
exercisable  during  his or her  lifetime  only  by  such  Participant,  or,  if
permissible  under  applicable  law,  by such  Participant's  guardian  or legal
representative.

Article 7.   Restricted Stock

         7.1 Grant of Restricted  Stock.  Subject to the terms and provisions of
the Plan, the Committee,  at any time and from time to time, may grant Shares of
Restricted  Stock to eligible  Employees in such amounts as the Committee  shall
determine.

         7.2 Restricted  Stock  Agreement.  Each Restricted Stock grant shall be
evidenced  by a  Restricted  Stock  Agreement  that shall  specify the Period of
Restriction, or Periods, the number of Restricted Stock Shares granted, and such
other provisions as the Committee shall determine.

         7.3  Transferability.  Except as provided in this Article 7, the Shares
of  Restricted  Stock  granted  herein  may not be sold,  transferred,  pledged,
assigned, or otherwise alienated or hypothecated until the end of the applicable
Period  of  Restriction  established  by  the  Committee  and  specified  in the
Restricted  Stock  Agreement,   or  upon  earlier   satisfaction  of  any  other
conditions,  as specified by the Committee in its sole  discretion and set forth
in the  Restricted  Stock  Agreement.  All rights with respect to the Restricted
Stock granted to a Participant  under the Plan shall be available  during his or
her lifetime only to such Participant.

         7.4  Other   Restrictions.   The  Committee  shall  impose  such  other
conditions  and/or  restrictions  on any  Shares  of  Restricted  Stock  granted
pursuant to the Plan as it may deem advisable including,  without limitation,  a
requirement that Participants pay a stipulated  purchase price for each Share of
Restricted   Stock,   restrictions   based  upon  the  achievement  of  specific
performance  goals  (Company-wide,   divisional,   and/or  individual),   and/or
restrictions  under applicable  Federal or state securities laws; and may legend
the certificates  representing  Restricted  Stock to give appropriate  notice of
such restrictions.

                                      -9-
<PAGE>


         7.5  Certificate   Legend.   In  addition  to  any  legends  placed  on
certificates  pursuant  to Section  7.4 herein,  each  certificate  representing
Shares of Restricted  Stock granted  pursuant to the Plan may bear the following
legend:

                  "The sale or other transfer of the Shares of stock represented
                  by this certificate,  whether  voluntary,  involuntary,  or by
                  operation  of law,  is  subject  to  certain  restrictions  on
                  transfer  as set  forth  in  the  Alliant  Energy  Corporation
                  Long-Term  Equity  Incentive  Plan, and in a Restricted  Stock
                  Agreement.  A copy  of the  Plan  and  such  Restricted  Stock
                  Agreement may be obtained from Alliant Energy Corporation."

         The   Company   shall  have  the  right  to  retain  the   certificates
representing  Shares of Restricted Stock in the Company's  possession until such
time as all conditions and/or  restrictions  applicable to such Shares have been
satisfied.

         7.6  Removal of  Restrictions.  Except as  otherwise  provided  in this
Article 7, Shares of  Restricted  Stock covered by each  Restricted  Stock grant
made under the Plan shall become freely  transferable by the  Participant  after
the last day of the Period of Restriction. Once the Shares are released from the
restrictions,  the Participant  shall be entitled to have the legend required by
Section 7.5 removed from his or her Share certificate.

         7.7  Voting  Rights.  During the  Period of  Restriction,  Participants
holding  Shares of Restricted  Stock granted  hereunder may exercise full voting
rights with respect to those Shares.

         7.8   Dividends   and  Other   Distributions.   During  the  Period  of
Restriction,  Participants  holding Shares of Restricted Stock granted hereunder
may be credited with all regular cash  dividends paid with respect to all Shares
while they are so held. Except as provided in the succeeding sentence, all other
cash dividends and other distributions paid with respect to Shares of Restricted
Stock may be  credited  to  Participants  subject  to the same  restrictions  on
transferability  and  forfeitability  as the  Shares of  Restricted  Stock  with
respect to which they were paid. If any such dividends or distributions are paid
in  Shares,   the  Shares  shall  be  subject  to  the  same   restrictions   on
transferability  and  forfeitability  as the  Shares of  Restricted  Stock  with
respect to which they were paid.

         Subject  to the  succeeding  paragraph,  all  dividends  credited  to a
Participant  shall  be paid  to the  Participant  within  forty-five  (45)  days
following  the full  vesting of the Shares of  Restricted  Stock with respect to
which such dividends were earned.

         7.9 Termination of Employment Due to Death, Disability,  or Retirement.
In the event the  employment of a Participant  is terminated by reason of death,
Disability,  or Retirement,  all  outstanding  Shares of Restricted  Stock shall
immediately  vest  one  hundred  percent  (100%)  as of the  date of  employment
termination (in the case of Disability,  the date employment terminates shall be
deemed to be the date that the Committee  designates as the date the  definition
of Disability has been satisfied).  The holder of the certificates of Restricted
Stock shall be entitled to have any  nontransferability  legends  required under
Sections 7.4 and 7.5 of this Plan removed from the Share certificates.

         7.10 Termination of Employment for Other Reasons.  If the employment of
a Participant  shall terminate for any reason other than those  specifically set
forth in Section 7.9 herein,  during the applicable  Period of Restriction,  all
Shares of Restricted Stock still subject to restriction as of the


                                      -10-
<PAGE>

effective  date of  employment  termination  immediately  shall be forfeited and
returned to the Company;  provided,  however,  that the  Committee  may waive in
whole or in part any or all remaining  restrictions with respect to such Shares,
upon such terms as the Committee, in its sole discretion, deems appropriate.

Article 8.   Performance Units and Performance Shares

         8.1  Grant of  Performance  Units/Shares.  Subject  to the terms of the
Plan,  Performance  Units and  Performance  Shares may be  granted  to  eligible
Employees  at any time and from  time to  time,  as shall be  determined  by the
Committee.  The Committee  shall have complete  discretion  in  determining  the
number of Performance Units and Performance  Shares granted to each Participant;
provided,  however,  that unless and until the Committee determines that a grant
of  Performance  Units  and/or  Shares  shall not be designed to qualify for the
"performance-based"  exemption under Code Section 162(m),  the maximum payout to
any Named Executive Officer with respect to Performance Units and/or Performance
Shares  granted  in any one fiscal  year of the  Company  shall be four  hundred
thousand dollars ($400,000).

         8.2 Value of Performance Units/Shares. Each Performance Unit shall have
an initial value that is established by the Committee at the time of grant. Each
Performance  Share shall have an initial value equal to the Fair Market Value of
a Share on the date of grant.  The Committee shall set performance  goals in its
discretion which,  depending on the extent to which they are met, will determine
the number and/or value of Performance Units/Shares that will be paid out to the
Participants.  The time period  during which the  performance  goals must be met
shall be called a "Performance Period." Performance Periods shall, in all cases,
exceed six (6) months in length.  Unless and until the  Committee  proposes  for
shareowner vote a change in the general performance measures,  the attainment of
which shall  determine  the number  and/or  value of  Performance  Units  and/or
Performance Shares granted under the Plan, the Company or Subsidiary performance
measure to be used for purposes of grants to Named  Executive  Officers shall be
chosen from among the following alternatives:

         (a)      Return on equity;

         (b)      Total  shareowner   return  (share  price   appreciation  plus
                  dividends);

         (c)      Net income;

         (d)      Earnings per share; and/or

         (e)      Cash flow.

         The  Committee  shall  have  sole  discretion  to alter  the  governing
performance measures,  subject to shareowner approval, to the extent required in
order to comply with Section 162(m) of the Code.  Notwithstanding the foregoing,
in the event the Committee determines it is advisable to grant Performance Units
and/or  Performance  Shares which shall not qualify for the  "performance-based"
exemption under Code Section 162(m),  the Committee may make such grants without
satisfying the requirements of Code Section 162(m).

         8.3  Earning  of   Performance   Units/Shares.   After  the  applicable
Performance  Period has ended, the holder of Performance  Units/Shares  shall be
entitled to receive payout on the number and


                                      -11-
<PAGE>

value of Performance Units/Shares earned by the Participant over the Performance
Period,  to be determined as a function of the extent to which the corresponding
performance goals have been achieved.

         8.4 Form and Timing of Payment of Performance Units/Shares.  Payment of
earned  Performance  Units/Shares  shall be made in a single  lump  sum,  within
seventy-five   (75)  calendar  days   following  the  close  of  the  applicable
Performance  Period.  The  Committee,  in its sole  discretion,  may pay  earned
Performance  Units/Shares  in the form of cash or in Shares (or in a combination
thereof),  which have an  aggregate  Fair Market Value equal to the value of the
earned  Performance  Units/Shares  at the  close of the  applicable  Performance
Period.   Such  Shares  may  be  granted  subject  to  any  restrictions  deemed
appropriate by the Committee.

         Participants  shall be entitled to receive any dividends  declared with
respect  to  Shares  which  have  been  earned  in  connection  with  grants  of
Performance Units and/or  Performance Shares which have been earned, but not yet
distributed  to  Participants.  (Such  dividends  shall be  subject  to the same
accrual,  forfeiture,  and payout restrictions as apply to dividends earned with
respect to Shares of Restricted  Stock,  as set forth in Section 7.8 herein.) In
addition,  Participants may, at the discretion of the Committee,  be entitled to
exercise their voting rights with respect to such Shares.

         8.5 Termination of Employment Due to Death, Disability,  Retirement, or
Involuntary  Termination  Without  Cause.  In  the  event  the  employment  of a
Participant  is  terminated  by  reason  of death,  Disability,  Retirement,  or
involuntary   termination   without  Cause  during  a  Performance  Period,  the
Participant shall receive a prorated payout of the Performance Units/Shares. The
prorated  payout shall be determined by the Committee,  in its sole  discretion,
and  shall be based  upon  the  length  of time  that the  Participant  held the
Performance  Units/Shares  during the Performance  Period,  and shall further be
adjusted based on the achievement of the preestablished performance goals.

         Payment of earned  Performance  Units/Shares  shall be made at the same
time payments are made to Participants who did not terminate  employment  during
the applicable Performance Period.

         8.6  Termination of Employment  for Other Reasons.  In the event that a
Participant's  employment terminates for any reason other than those reasons set
forth in Section 8.5 herein, all Performance  Units/Shares shall be forfeited by
the Participant to the Company.

         8.7 Nontransferability.  Except as otherwise provided by the Committee,
Performance  Units/Shares may not be sold,  transferred,  pledged,  assigned, or
otherwise  alienated  or  hypothecated,  other  than by  will or by the  laws of
descent  and  distribution.   Further,  except  as  otherwise  provided  by  the
Committee, a Participant's rights under the Plan shall be exercisable during the
Participant's  lifetime  only  by the  Participant  or the  Participant's  legal
representative.

Article 9.   Beneficiary Designation

         Each  Participant  under  the Plan  may,  from  time to time,  name any
beneficiary or beneficiaries  (who may be named contingently or successively) to
whom any benefit under the Plan is to be paid in case of his or her death before
he or she  receives  any or all of such  benefit.  Each such  designation  shall
revoke  all  prior  designations  by the  same  Participant,  shall be in a form
prescribed  by the  Company,  and  will be  effective  only  when  filed  by the
Participant in writing with the Company during the  Participant's  lifetime.  In
the  absence  of  any  such  designation,   benefits  remaining  unpaid  at  the
Participant's  death shall be paid to the Participant's  estate. The spouse of a
married Participant


                                      -12-
<PAGE>


domiciled in a community property  jurisdiction shall join in any designation of
beneficiary or beneficiaries other than the spouse.

Article 10.  Deferrals

         The  Committee  may permit a  Participant  to defer such  Participant's
receipt of the payment of cash or the delivery of Shares that would otherwise be
due to such  Participant  by virtue of the exercise of an Option or the lapse or
waiver of restrictions  with respect to Restricted Stock, or the satisfaction of
any requirements or goals with respect to Performance Units/Shares.  If any such
deferral  election is required or permitted,  the Committee  shall,  in its sole
discretion, establish rules and procedures for such payment deferrals.

Article 11.  Rights of Employees

         11.1  Employment.  Nothing in the Plan shall interfere with or limit in
any way the right of the Company to terminate  any  Participant's  employment at
any time, nor confer upon any Participant any right to continue in the employ of
the Company.  For purposes of the Plan,  transfer of employment of a Participant
between the Company and any one of its Subsidiaries,  or vice versa, (or between
Subsidiaries) shall not be deemed a termination of employment.

         11.2 Participation.  No Employee shall have the right to be selected to
receive an Award under this Plan, or, having been so selected, to be selected to
receive a future Award.

Article 12.  Change in Control

         12.1  Acceleration  Upon a Change in Control.  Upon the occurrence of a
Change in Control,  unless  otherwise  specifically  prohibited  by the terms of
Article 17 herein:

         (a)      Any and all Options granted hereunder shall become immediately
                  exercisable;

         (b)      Any  Period  of  Restriction  and   restrictions   imposed  on
                  Restricted Shares shall lapse;

         (c)      The target payout opportunity attainable under all outstanding
                  Performance  Units and  Performance  Shares shall be deemed to
                  have been fully earned for the entire Performance Period(s) as
                  of the  effective  date of the  Change in  Control,  and there
                  shall be paid out in cash to  Participants  within thirty (30)
                  days  following the effective  date of the Change in Control a
                  pro rata portion of such target  payout  opportunity  based on
                  the number of complete and partial  calendar months within the
                  Performance  Period  which had  elapsed  as of such  effective
                  date;   provided,   however,   that  there  shall  not  be  an
                  accelerated  payout  with  respect  to  Performance  Units  or
                  Performance Shares which were granted less than six (6) months
                  prior to the effective date of the Change in Control; and

         (d)      Subject to Article 13  herein,  the  Committee  shall have the
                  authority  to  make  any   modifications   to  the  Awards  as
                  determined  by the  Committee  to be  appropriate  before  the
                  effective date of the Change in Control.

         12.2 Pooling  Limitations.  The Committee may, in its sole  discretion,
amend,  modify or rescind the  provisions of Section 12.1 if it determines  that
the operation of Section 12.1 may prevent a


                                      -13-
<PAGE>

transaction  in  which  the  Company  or any  affiliate  is a party  from  being
accounted for on a pooling-of-interests basis.

Article 13.  Amendment, Modification, and Termination

         13.1 Amendment,  Modification,  and Termination.  The Board may, at any
time and from time to time, alter, amend, suspend or terminate the Plan in whole
or in part.

         The Committee shall not have the authority to cancel outstanding Awards
and issue substitute Awards in replacement thereof.

         13.2  Awards  Previously   Granted.  No  termination,   amendment,   or
modification  of the Plan shall (except as otherwise  expressly  contemplated by
the Plan for Awards  granted  after  January 20, 1999)  adversely  affect in any
material way any Award  previously  granted under the Plan,  without the written
consent of the Participant holding such Award.

Article 14.  Withholding

         14.1 Tax Withholding. The Company shall have the power and the right to
deduct or withhold,  or require a Participant to remit to the Company, an amount
sufficient  to  satisfy   Federal,   state,   and  local  taxes  (including  the
Participant's  FICA  obligation)  required by law to be withheld with respect to
any taxable event  arising  from, or as a result of, any Awards to  Participants
under this Plan.

         14.2 Share Withholding.  With respect to withholding  required upon the
exercise of Options, upon the lapse of restrictions on Restricted Stock, or upon
any  other  taxable  event  arising  as a result of  Awards  granted  hereunder,
Participants may elect, subject to the approval of the Committee, to satisfy the
withholding  requirement,  in whole or in part,  by having the Company  withhold
Shares (or  deliver to the Company  previously  acquired  Shares)  having a Fair
Market  Value  on the  date the tax is to be  determined  equal  to the  minimum
statutory  total tax which is required to be  withheld  in  connection  with the
transaction. The Committee may establish such procedures as it deems appropriate
for the settling of withholding obligations with Shares.

Article 15.  Indemnification

         Each person who is or shall have been a member of the Committee,  or of
the Board,  shall be  indemnified  and held harmless by the Company  against and
from  any  loss,  cost,  liability,  or  expense  that  may be  imposed  upon or
reasonably  incurred  by him or her in  connection  with or  resulting  from any
claim, action, suit, or proceeding to which he or she may be a party or in which
he or she may be involved by reason of any action  taken or failure to act under
the  Plan  and  against  and  from  any  and all  amounts  paid by him or her in
settlement  thereof,  with  the  Company's  approval,  or  paid by him or her in
satisfaction of any judgment in any such action, suit, or proceeding against him
or her,  provided  he or she shall give the Company an  opportunity,  at its own
expense, to handle and defend the same before he or she undertakes to handle and
defend it on his or her own behalf.

         The foregoing  right of  indemnification  shall not be exclusive of any
other rights of  indemnification to which such persons may be entitled under the
Company's Articles of Incorporation or Bylaws, as a matter of law, or otherwise,
or any power that the Company may have to indemnify them or hold them harmless.

                                      -14-
<PAGE>


Article 16.  Successors

         All  obligations of the Company under the Plan,  with respect to Awards
granted hereunder, shall be binding on any successor to the Company, whether the
existence  of such  successor  is the result of a direct or  indirect  purchase,
merger, consolidation, or otherwise, of all or substantially all of the business
and/or assets of the Company.

Article 17.  Restrictions on Share Transferability

         In  addition to any  restrictions  imposed  pursuant  to the Plan,  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 Securities and Exchange  Commission,
any stock  exchange  or 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.

Article 18.  Legal Construction

         18.1  Gender  and  Number.  Except  where  otherwise  indicated  by the
context,  any masculine  term used herein also shall  include the feminine;  the
plural shall include the singular and the singular shall include the plural.

         18.2 Severability. In the event any provision of the Plan shall be held
illegal or invalid for any reason, the illegality or invalidity shall not affect
the remaining parts of the Plan, and the Plan shall be construed and enforced as
if the illegal or invalid provision had not been included.

         18.3  Requirements  of Law.  The granting of Awards and the issuance of
Shares  under the Plan shall be  subject  to all  applicable  laws,  rules,  and
regulations,  and to such  approvals  by any  governmental  agencies or national
securities exchanges as may be required.

         18.4  Governing  Law. To the extent not  preempted  by Federal law, the
Plan, and all agreements  hereunder,  shall be construed in accordance  with and
governed by the laws of the State of Wisconsin.