WPS RESOURCES CORPORATION

DEFERRED COMPENSATION PLAN

As Amended and Restated Effective January 1, 2001

 

 

 

WPS RESOURCES CORPORATION

DEFERRED COMPENSATION PLAN

    The WPS Resources Corporation Deferred Compensation Plan (the"Plan") has been adopted to promote the best interests of WPSResources Corporation (the "Company") and the stockholders of theCompany by attracting and retaining key management employees possessing a stronginterest in the successful operation of the Company and its subsidiaries oraffiliates and encouraging their continued loyalty, service and counsel to theCompany and its subsidiaries or affiliates. The Plan is amended and restatedeffective January 1, 2001 as set forth herein.

    Except as expressly provided herein, the Plan, as herein amended and restatedeffective January 1, 2001, applies to those employees who are actively employedby the Company on January 1, 2001, and who have been designated forparticipation by the Committee. Except as expressly provided herein,distribution of benefits to an employee who retired from or terminatedemployment with the Company prior to January 1, 2001, shall be governed by theterms of the Plan as in effect on the date of the employee's retirement ortermination of employment.

    The Plan, as hereby amended and restated, is subject to shareholder approvalat the 2001 annual meeting of shareholders of the Company. In the event thatshareholder approval is not obtained, the Plan as hereby amended and restatedwill be null and void, and the Plan as in effect on December 31, 2000 shallcontinue.

 

ARTICLE I. DEFINITIONS AND CONSTRUCTION

     Section 1.01.Definitions.
    The following terms have the meanings indicated below unless the context inwhich the term is used clearly indicates otherwise:

    (a) Account: The record keeping account or accounts maintained to record theinterest of each Participant under the Plan. An Account is established forrecord keeping purposes only and not to reflect the physical segregation ofassets on the Participant's behalf, and may consist of such subaccounts orbalances as the Committee may determine to be necessary or appropriate.

    (b) Act: The Securities Act of 1933, as interpreted by regulations and rulesissued pursuant thereto, all as amended and in effect from time to time. Anyreference to a specific provision of the Act shall be deemed to includereference to any successor provision thereto.

    (c) Annual Bonus Deferral: See Section 1.01(l)(ii).

    (d) Available Investment Option: See Section 5.01(a).

    (e) Base Compensation: The base salary or wage payable by a ParticipatingEmployer for services performed prior to reduction for contributions by theParticipant to this Plan or pre-tax or after-tax contributions by theParticipant to any other employee benefit plan maintained by a ParticipatingEmployer, but exclusive of extraordinary payments such as overtime, bonuses,meal allowances, reimbursed expenses, termination pay, moving pay, commutingexpenses, severance pay, non-elective deferred compensation payments oraccruals, stock options, the value of employer-provided fringe benefits orcoverage, all as determined in accordance with such uniform rules, regulationsor standards as may be prescribed by the Committee.

    (f) Base Compensation Deferral: See Section 1.01(l)(i).

    (g) Beneficiary: The person or entity designated by a Participant to be hisbeneficiary for purposes of this Plan. If a Participant designates his spouse asa beneficiary, such beneficiary designation automatically shall become null andvoid on the date of the Participant's divorce or legal separation from suchspouse. If a valid designation of Beneficiary is not in effect at time of theParticipant's death, the estate of the Participant is deemed to be the soleBeneficiary. If a Beneficiary dies while entitled to receive distributions fromthe Plan, any remaining payments shall be paid to the estate of the Beneficiary.Beneficiary designations shall be in writing, filed with the Committee, and insuch form as the Committee may prescribe for this purpose.

    (h) Board: The Board of Directors of the Company.

    (i) Code: The Internal Revenue Code of 1986, as interpreted by regulationsand rulings issued pursuant thereto, all as amended and in effect from time totime. Any reference to a specific provision of the Code shall be deemed toinclude reference to any successor provision thereto.

    (j) Committee: The Compensation and Nominating Committee of the Board.

    (k) Company: WPS Resources Corporation, or any successor corporation.

    (l) Deferral: An amount credited, in accordance with a Participant'selection, to the Participant's Account under the Plan in lieu of the currentpayment of an equal amount of cash compensation to the Participant.

(i) Base Compensation Deferral: A Deferral of a portion of a            Participant's Base Compensation in accordance with Section 2.01.

(ii) Annual Bonus Deferral: A Deferral of all or a portion of a            Participant's annual bonus award in accordance with Section 2.02.

(iii) LTIP Deferral: A Deferral of all or a portion of a            Participant's performance share award under the WPS Resources            Corporation 2001 Omnibus Incentive Compensation Plan, in accordance            with Section 2.03.

    (m) ERISA: The Employee Retirement Income Security Act of 1974, asinterpreted by regulations and rulings issued pursuant thereto, all as amendedand in effect from time to time. Any reference to a specific provision of ERISAshall be deemed to include reference to any successor provision thereto.

    (n) Exchange Act: The Securities Exchange Act of 1934, as interpreted byregulations and rules issued pursuant thereto, all as amended and in effect fromtime to time. Any reference to a specific provision of the Exchange Act shall bedeemed to include reference to any successor provision thereto.

    (o) Investment Options: The hypothetical investment accounts described inArticle IV and such other investment options as the Committee may from time totime determine (which may, but need not, be based upon one or more of theinvestment options available under the Wisconsin Public Service CorporationAdministrative Employees Savings Plan).

    (p) Investment Period: See Section 5.01(e).

    (q) LTIP Deferral: See Section 1.01(l)(iii).

    (r) Participant: Subject to Section 2.02, a common law employee of aParticipating Employer who has been designated by the Committee as beingeligible to participate in this Plan and, where the context so requires, aformer employee entitled to receive a benefit hereunder.

    (s) Participating Employer: The Company and any direct or indirect subsidiaryof the Company that, with the consent of the Committee, participates in the Planfor the benefit of one or more Participants.

    (t) Stock Unit Accounts: The Incentive Stock Unit Account described inSection 4.03 and the Base Stock Unit Account described in Section 4.04.

    (u) Trust: The WPS Resources Corporation Deferred Compensation Trust or otherfunding vehicle which may from time to time be established, as amended and ineffect from time to time.

    (v) WPS Resources Stock: The common stock, $1.00 par value, of the Company.

    (w) WPS Resources Stock Units: The hypothetical shares of WPS Resources Stockthat are credited to the Stock Unit Accounts in accordance with Sections 4.03and 4.04.

    Section 1.02.Construction and Applicable Law.
    (a) Wherever any words are used in the masculine, they shall be construed asthough they were used in the feminine in all cases where they would so apply;and wherever any words are use in the singular or the plural, they shall beconstrued as though they were used in the plural or the singular, as the casemay be, in all cases where they would so apply. Titles of articles and sectionsare for general information only, and the Plan is not to be construed byreference to such items.

    (b) This Plan is intended to be a plan of deferred compensation maintainedfor a select group of management or highly compensated employees as that term isused in ERISA, and shall be interpreted so as to comply with the applicablerequirements thereof. In all other respects, the Plan is to be construed and itsvalidity determined according to the laws of the State of Wisconsin to theextent such laws are not preempted by federal law. In case any provision of thePlan is held illegal or invalid for any reason, the illegality or invaliditywill not affect the remaining parts of the Plan, but the Plan shall, to theextent possible, be construed and enforced as if the illegal or invalidprovision had never been inserted.
** 

ARTICLE II. PARTICIPATION**
     Section 2.01.Eligibility.
    A Participant shall be eligible to participate in the Plan only if theParticipant is employed by a Participating Employer and if the Participant hasbeen designated for participation by the Committee.

    Section 2.02.Certain Transfers of Employment.
    If directed by the Committee, a Participant whose employment is transferredto a corporation or other entity (the "Transferee Employer") that isnot a Participating Employer, but in which the Company or an affiliate of theCompany holds an ownership interest, then until the earliest to occur of (a) thedate on which the Participant ceases to be employed by such Transferee Employer,(b) the date on which the Company or an affiliate of the Company no longer holdsan ownership interest in the Transferee Employer, or (c) such other datedetermined by the Committee, the Participant shall be treated as if he or shewere still actively employed by a Participating Employer. The foregoing ruleshall apply only for the purpose of determining whether the Participant hasterminated employment for purposes of the distribution provisions of Article VI;it shall not apply, and the Participant shall not be entitled to make additionalDeferrals, with respect to remuneration attributable to services rendered withthe Transferee Employer. The Committee may promulgate such additional rules asmay be necessary or desirable in connection with any such transfer ofemployment.
** 

ARTICLE III. DEFERRALS OF COMPENSATION**
     Section 3.01.Deferrals Of Base Compensation.
    (a) Initial Deferral Election. A Participant may elect, in such formand manner as the Committee may prescribe, to defer payment of a portion of theBase Compensation that would otherwise be paid to the Participant. AParticipant's election shall specify the percentage (in increments of 1% to amaximum of 75% or such lesser amount or percentage as may be established by theCommittee) of the Participant's Base Compensation that the Participant wishes todefer. A validly executed election shall become effective with respect to BaseCompensation earned by the Participant in the first payroll period thatcommences on or after the date on which the Participant's deferral election isreceived and accepted by the Committee, or as soon thereafter as practicable. AParticipant's deferral election, once effective, shall remain in effect untilmodified by the Participant in accordance with subsection (b) below or otherwiserevoked in accordance with Plan rules.

    (b) Revised Deferral Election. A Participant may modify his thencurrent deferral election by filing a revised election form, properly completedand signed, with the Committee. A validly executed revised election will beeffective with respect to Base Compensation earned by the Participant with thefirst payroll period commencing on or after the date on which the Participant'srevised deferral election is received and accepted by the Committee, or as soonthereafter as practicable. A Participant's revised deferral election, onceeffective, shall remain in effect until again modified by the Participant underthis subsection (b) or otherwise revoked in accordance with Plan rules.

    Section 3.02.Deferrals of Annual Bonus Awards.
    (a) Election of Bonus Deferrals. A Participant may irrevocably elect,in such form and manner as the Committee may prescribe, to defer payment of aportion of the annual cash bonus that is awarded and that would otherwise bepaid to the Participant with respect to any year. A Participant's election shallspecify the percentage (in increments of 1% to a maximum of 100% or such lesseramount or percentage as may be established by the Committee) of theParticipant's annual cash bonus that the Participant wishes to defer. A validlyexecuted election shall become effective with respect to the annual bonus thatmay be awarded to the Participant with respect to a calendar year if theParticipant's deferral election is received and accepted by the Committee on orbefore April 1 of that calendar year or within such other period as theCommittee may establish; provided that the Participant's deferral election withrespect to the 2001 annual bonus (that would otherwise be paid in 2002) may besubmitted within 45 days following the date on which shareholders of the Companyapprove the Plan at the Company's 2001 annual meeting, or within such otherperiod as the Committee may establish. A Participant's election to defer anannual bonus award shall be effective only for the year to which the electionrelates, and shall not carry over from year to year.

    Section 3.03.Deferral of LTIP Performance Share Awards.
    A Participant may irrevocably elect, in such form and manner as the Committeemay prescribe, to defer payment of a portion of any performance shares awardedto the Participant under the WPS Resources Corporation 2001 Onmibus IncentiveCompensation Plan. A Participant's election shall specify the whole number ofperformance shares (up to 100% of such shares or such lesser number orpercentage as may be established by the Committee) of the Participant's awardthat the Participant wishes to defer. A validly executed election shall becomeeffective with respect to performance shares to be earned by the Participantwith respect to any performance period under the WPS Resources Corporation 2001Omnibus Incentive Compensation Plan if the Participant's deferral election isreceived and accepted by the Committee on or before April 1 of the calendar yearin which the performance period begins, or within such other period as theCommittee may establish; provided that the Participant's deferral election withrespect to the performance period that begins in 2001 may be submitted within 45days following the date on which shareholders of the Company approve the Plan atthe Company's 2001 annual meeting, or within such other period as the Committeemay establish. A Participant's election to defer a performance share award shallbe effective only for the performance period to which the election relates, anda Participant's election does not carry over from performance period toperformance period. A Participant's LTIP Deferral will be automatically creditedto the Participant's Incentive Stock Unit Account.

    Section 3.04.Matching Contribution Credits.
    (a) Allocation of Credits. A Participant who is a participant in theWisconsin Public Service Corporation Administrative Employees' Savings Plan("Savings Plan") and who makes Base Compensation Deferrals and/orAnnual Bonus Deferrals under this Plan shall be entitled to a matchingcontribution credit, determined as of December 31 of each year, equal to thedifference (if any) between:

(i) The value of the matching contribution that the Participant            would have received under the Savings Plan, if Base Compensation            Deferrals and Annual Bonus Deferrals made by the Participant under            this Plan were instead treated as "compensation" under the            Savings Plan for purposes of applying the Participant's deferral            election under the Savings Plan; provided that all limits and            restrictions otherwise imposed under the Savings Plan, including the            maximum compensation limit under Section 401(a)(17) of the Code,            shall continue to apply; and

(ii) The value of the matching contribution actually received by            the Participant for that year under the Savings Plan.

    (b) Investment of Credits. A Participant's matching contributioncredit will be automatically credited to the Participant's Incentive Stock UnitAccount.

    Section 3.05.Involuntary Termination of Deferral Elections.
    A Participant's deferral elections shall be automatically revoked upon theParticipant's termination of employment from the Participating Employers, unlessthe Committee determines otherwise. In addition, if the Committee determinesthat the Participant is no longer eligible to participate in the Plan or thatrevocation of a Participant's eligibility is necessary or desirable in order forthe Plan to qualify under ERISA as a plan of deferred compensation for a selectgroup of management or highly compensated employees.
**ARTICLE IV. HYPOTHETICAL INVESTMENT OPTIONS**
     Section 4.01.Reserve Account A.
    (a) Limited Purpose Account. Reserve Account A is limited tocompensation deferred by a Participant prior to January 1, 1996, together withattributed earnings on such deferrals through December 31, 2000. Except forattributed earnings as described below, no further deferrals, contributions orcredits of any kind will be made to this account on behalf of a Participant.

    (b) Crediting of Interest Equivalent. As of the end of each Plan Year,the Account will be credited with an interest equivalent on the balance in theaccount from time to time during the year. The annual interest equivalent willbe the sum (on a non-compounded basis) of the attributed earnings for each monthduring the year based on the account balance as of the last day of the month.Unless modified by the Committee, the interest equivalent rate for any monthwill be the greater of:

(i) one-half of one percent (0.5%); or

(ii) one-twelfth (1/12) of the consolidated return on common            shareholders' equity of the Company and all consolidated            subsidiaries (ROE); provided, however, that unless the Committee            determines otherwise, this Paragraph (ii) will not apply to a former            Participant who terminates employment with a Participating Employer            prior to attainment of age 55 and prior to the occurrence of a            Change in Control (as defined in Section 8.01). For the months of            April through September, ROE means the consolidated return on equity            of the Company and all consolidated subsidiaries for the twelve (12)            months ended on the preceding March 31 as calculated pursuant to the            Company's standard accounting procedure for financial reporting to            shareholders. For the months October through March, ROE means return            on equity as described above for the twelve (12) months ended on the            preceding September 30.

    (c) Revised Rate. Subject to Article VIII, the Committee may revisethe interest equivalent rate or the manner in which it is calculated, but in noevent shall the rate be less than six percent (6%) per annum. Any such revisedrate shall be effective with the calendar month following such action by theCommittee.

    Section 4.02.Reserve Account B.
    (a) Availability. Reserve Account B is an Available Investment Optionwith respect to the deemed investment of Base Compensation Deferrals and AnnualBonus Deferrals. It is credited with earnings equivalent based upon a percentageof the Company's return on equity for the year.

    (b) Crediting of Interest Equivalent. As of the end of each calendarquarter, the account will be credited with an interest equivalent on the balancein the account from time to time during the year. The quarterly interestequivalent will be the sum (on a non-compounded basis) of the attributedearnings for each month during the quarter based on the account balance as ofthe last day of each month. Unless modified by the Committee, the interestequivalent rate for any month will be the greater of:

(i) one-half of one percent (0.5%); or

(ii) seventy percent (70%) of one-twelfth (1/12) of the            consolidated return on common shareholders equity of the Company and            all consolidated subsidiaries (ROE); provided, however, that unless            the Committee determines otherwise, this Paragraph (ii) will not            apply to a former Participant who terminates employment with a            Participating Employer prior to attainment of age 55 and prior to            the occurrence of a Change in Control (as defined in            Section 8.01). For the months of April through September, ROE            means the consolidated return on equity of the Company and all            consolidated subsidiaries for the twelve (12) months ended on the            preceding March 31 as calculated pursuant to the Company's standard            accounting procedure for financial reporting to shareholders. For            the months October through March, ROE means return on equity as            described above for the twelve (12) months ended on the preceding            September 30.

    (c) Revised Rate. Subject to Article VIII, the Committee may revisethe interest equivalent rate or the manner in which it is calculated, but in noevent shall the rate be less than six percent (6%) per annum. Any such revisedrate shall be effective with the calendar month following such action by theCommittee.

    Section 4.03.Incentive Stock Unit Account.
    (a) Limited Purpose "Buy Only" Account. The Incentive StockUnit Account is a "buy only" account limited to (i) Annual BonusDeferrals that the Participant elects to be credited to the Incentive Stock UnitAccount in accordance with Section 5.01(c), (ii) LTIP Deferrals pursuant toSection 3.03, and (iii) matching contribution credits pursuant to Section 3.04.

    (b) Conversion to WPS Stock Units. As of the end of each month, alleligible Deferrals made by or on behalf of a Participant during that month andallocated to the Incentive Stock Unit Account and, for the month of December,all of a Participant's matching contribution credits under Section 3.04 (the"Incentive Stock Unit Convertible Amount") are converted, for recordkeeping purposes, into whole and fractional WPS Resources Stock Units, withfractional units calculated to four decimal places. The conversion shall beaccomplished by dividing each Participant's Incentive Stock Unit ConvertibleAmount by the average purchase price of all shares of WPS Resources Stockpurchased during that month by or on behalf of the Trust and the WPS ResourcesCorporation Stock Investment Plan. Likewise, any dividends that would have beenpayable on the WPS Resources Stock Units credited to a Participant's IncentiveStock Unit Account had such Units been actual shares of WPS Resources Stockshall be converted, for record keeping purposes, into whole and fractional WPSResources Stock Units based on the average purchase price of all shares of WPSResources Stock purchased by or on behalf of the Trust and the WPS ResourcesCorporation Stock Investment Plan during the month in which the dividend ispaid. Notwithstanding the foregoing, if for any month there are no open-marketpurchases by or on behalf of the Trust and the WPS Resources Corporation StockInvestment Plan, the conversion shall be accomplished based upon the closingprice of a share of WPS Resources Stock on the last date on the applicable monthon which a share of WPS Resources Stock was traded, as reported in the WallStreet Journal's New York Stock Exchange Composite Transaction listing.

    Section 4.04.Base Stock Unit Account.
    (a) Availability. The Base Stock Unit Account is an AvailableInvestment Option with respect to the deemed investment of Base CompensationDeferrals.

    (b) Conversion to WPS Stock Units. As of the end of each month, alleligible Deferrals made by or on behalf of a Participant during that month andallocated to the Base Stock Unit Account (the "Base Stock Unit ConvertibleAmount") are converted, for record keeping purposes, into whole andfractional WPS Resources Stock Units, with fractional units calculated to fourdecimal places. The conversion shall be accomplished by dividing eachParticipant's Base Stock Unit Convertible Amount by the average purchase priceof all shares of WPS Resources Stock purchased during that month by or on behalfof the Trust and the WPS Resources Corporation Stock Investment Plan. Likewise,any dividends that would have been payable on the WPS Resources Stock Unitscredited to a Participant's Base Stock Unit Account had such Units been actualshares of WPS Resources Stock shall be converted, for record keeping purposes,into whole and fractional WPS Resources Stock Units based on the averagepurchase price of all shares of WPS Resources Stock purchased by or on behalf ofthe Trust and the WPS Resources Corporation Stock Investment Plan during themonth in which the dividend is paid. Notwithstanding the foregoing, if for anymonth there are no open-market purchases by or on behalf of the Trust and theWPS Resources Corporation Stock Investment Plan, the conversion shall beaccomplished based upon the closing price of a share of WPS Resources Stock onthe last date on the applicable month on which a share of WPS Resources Stockwas traded, as reported in the Wall Street Journal's New York Stock ExchangeComposite Transaction listing.

    (c) Conversion from WPS Stock Units. If a Participant elects underSection 5.01(f) to reallocate all or any portion of his Base Stock Unit Accountamong the other Available Investment Options, the WPS Resources Stock Units towhich such election relates shall be converted, for record keeping purposes,into an amount equal to the product of such units and the closing price of ashare of WPS Resources Stock, on the most recent date prior to the effectivedate of such reallocation on which a share of WPS Resources Stock was traded, asreported in the Wall Street Journal's New York Stock Exchange CompositeTransaction listing.

    (d) Securities Law Restrictions. Notwithstanding anything to thecontrary herein, all elections under Section 5.01(f) by a Participant who issubject to Section 16 of the Exchange Act are subject to review by the Committeeprior to implementation. Further, the following reallocation transactions underSection 5.01(f) by a Participant who is subject to Section 16 of the ExchangeAct are prohibited: (i) elections to reallocate the deemedinvestment of the affected Participant's Account into WPS Resources Stock Unitswithin six (6) months of an election to reallocate deemed investments out of WPSResources Stock Units; and (ii) elections to reallocate the deemed investment ofthe affected Participant's Account out of WPS Resources Stock Units within six(6) months of an election to reallocate deemed investments into WPS ResourcesStock Units (collectively, "Prohibited Transactions"). All ProhibitedTransactions are void. In accordance with Section 9.02, the Committee mayrestrict additional transactions, or impose other rules and procedures, to theextent deemed desirable by the Committee in order to comply with the ExchangeAct.
** 

ARTICLE V. ACCOUNTING AND HYPOTHETICAL INVESTMENT ELECTIONS**
     Section 5.01.Hypothetical Investment of Participant Accounts.
    (a) Available Investment Options.

(i) For purposes of directing the deemed investment of Base            Compensation Deferrals under subsection (b) below and for purposes            of reallocating the deemed investment of the Participant's Account            under subsection (f) below, the Available Investment Options shall            be all of the Investment Options other than Reserve Account A and            the Incentive Stock Unit Account.

(ii) For purposes of directing the deemed investment of Annual            Bonus Deferrals under subsection (c) below, the Available Investment            Options shall be all of the Investment Options other than Reserve            Account A and the Base Stock Unit Account.

    (b) Deemed Investment of Base Compensation Deferrals. In accordancewith uniform rules prescribed by the Committee, each Participant shalldesignate, in writing or in such other manner as the Committee may prescribe,how Base Compensation Deferrals made while the designation is in effect arecredited among the Available Investment Options. When selecting more than oneAvailable Investment Option, the Participant shall designate, in whole multiplesof 10% or such other percentage determined by the Committee, the percentage ofhis or her Base Compensation Deferrals to be credited to each AvailableInvestment Option. If the Participant fails to make a timely and completeinvestment designation, he or she shall be deemed to have elected that 100% ofhis or her Base Compensation Deferrals be credited to Reserve Account B or suchother of the Available Investment Options specified by the Committee for thispurpose. A Participant's election or deemed election shall become effectivebeginning with the first payroll period commencing on or after the date on whichthe election is received and accepted by the Committee, and shall remain ineffect unless and until modified by a subsequent election that becomes effectivein accordance with the rules of this subsection.

    (c) Deemed Investment of Annual Bonus Deferrals. In accordance withuniform rules prescribed by the Committee, each Participant shall designate, inwriting or in such other manner as the Committee may prescribe, how Annual BonusDeferrals made while the designation is in effect are credited among theAvailable Investment Options. When selecting more than one Available InvestmentOption, the Participant shall designate, in whole multiples of 10% or such otherpercentage determined by the Committee, the percentage of his or her AnnualBonus Deferrals to be credited to each Available Investment Option; provided,that with respect to any portion of the Annual Bonus Deferral that theParticipant allocates to the Incentive Stock Unit Account, the amount allocatedto such account will be 105% of the amount designated by the Participant fordeferral into the Incentive Stock Unit Account. If the Participant fails to makea timely and complete investment designation, he or she shall be deemed to haveelected that 100% of his or her Annual Bonus Deferral be credited to ReserveAccount B or such other Investment Option specified by the Committee for thispurpose. A Participant's election or deemed election shall become effective withrespect to annual bonus amounts awarded on or after the date on which theelection is received and accepted by the Committee, and shall remain in effectunless and until modified by a subsequent election that becomes effective inaccordance with the rules of this subsection. 

    (d) Deemed Investment of LTIP Deferrals. LTIP Deferrals under Section3.03 and matching contribution credits under Section 3.04 are credited to theIncentive Stock Unit Account. The Participant is not permitted to make aninvestment election with respect to LTIP Deferrals and matching contributioncredits.

    (e) Allocation of Deemed Investment Gain or Loss. On a quarterly basisor such other basis as the Committee may prescribe (the "InvestmentPeriod"), the Account of each Participant will be credited (or charged)based upon the investment gain (or loss) that the Participant would haverealized with respect to his or her Account had the Account been invested inaccordance with the terms of the Plan and where applicable, the Participant'swritten election. Subject to the special rules set forth in Article IV withrespect to Reserve Account A, Reserve Account B, the Incentive Stock UnitAccount and the Base Stock Unit Account, the credit (or charge) shall be thesum, separately calculated for each of the Investment Options, of the productobtained by multiplying (i) the portion (if any) of the Participant's Account asof the first day of the Investment Period that is deemed to have been investedin each Investment Option, and (ii) the rate of return experienced by thatInvestment Option during the Investment Period.  The Committee, in itsdiscretion, may prescribe alternate rules for the valuation of ParticipantAccounts, including, without limitation, the application of unit accountingprinciples.

    (f) Reallocation of Account. Subject to Section 4.04(d), and inaccordance with rules prescribed by the Committee, each Participant may elect toreallocate his or her Account (other than the portion deemed to be invested inReserve Account A or the Incentive Stock Unit Account) among the AvailableInvestment Options. When selecting more than one Investment Option, theParticipant shall designate, in whole multiples of 10% or such other percentagedetermined by the Committee, the percentage of his or her Account (other thanthe portion that is deemed to be invested in Reserve Account A or the IncentiveStock Unit Account) that is deemed to be invested in each Available InvestmentOption after the investment reallocation is given effect. A Participant'sreallocation election made in any Investment Period shall become effective onthe first day of the next Investment Period, or as soon thereafter as ispracticable, and shall remain in effect unless and until modified by asubsequent election that becomes effective in accordance with the rules of thissubsection. Other than a reallocation of a Participant's Account pursuant to arevised investment election submitted by the Participant, the deemed investmentallocation of a Participant will not be adjusted to reflect differences in therelative investment return realized by the various hypothetical InvestmentOptions that the Participant has designated.

    (g) The foregoing provisions of this Section shall be effective on the firstday of the month coincident with or next following the date on whichshareholders of the Company approve the Plan as hereby amended and restated, oras soon thereafter as is practicable. Prior to implementation of the terms andconditions of this Section, a Participant's Account shall be credited withhypothetical investment gain or loss in accordance with the terms of the Plan asin effect on December 31, 2000.

    Section 5.02.Accounts are For Record Keeping Purposes Only.
    Plan Accounts and the record keeping procedures described herein serve solelyas a device for determining the amount of benefits accumulated by a Participantunder the Plan, and shall not constitute or imply an obligation on the part of aParticipating Employer to fund such benefits. In any event, a ParticipatingEmployer may, in its discretion, set aside assets equal to part or all of suchaccount balances and invest such assets in Company stock, life insurance or anyother investment deemed appropriate. Any such assets, including WPS ResourcesStock and any other assets held under the Trust, shall be and remain the soleproperty of the Company and except to the extent that the Trust authorizes aParticipant to direct the trustee with respect to the voting of WPS ResourcesStock held in the Trust, a Participant shall have no proprietary rights of anynature whatsoever with respect to such assets.
** 

ARTICLE VI. DISTRIBUTION OF ACCOUNTS**
     Section 6.01.Distribution Election.
    (a) Election. A Participant, at the time he commences participation inthe Plan, shall make a distribution election with respect to his Account. Theelection shall be in such form as the Committee may prescribe, and shall specifythe distribution commencement date, the distribution period, and thedistribution method applicable following the Participant's death. Any suchelection shall be consistent with the following rules (or where the Participantfails to make a selection, in accordance with the default rules set forthbelow):

(i) Distribution Commencement Date. Unless the Participant            has selected a later commencement date (which in no event shall be            later than the first distribution period following the Participant's            attainment of age 72), distribution of a Participant's Accounts will            commence within 60 days following the end of the calendar year in            which the Participant terminates employment or service from all            Participating Employers. For purposes of this Plan, a Participant            who is disabled shall be deemed to have retired or terminated at the            conclusion of benefits under all disability income plans sponsored            by a Participating Employer or to which a Participating Employer            contributes, unless otherwise determined by the Committee. Further,            a Participant who ceases employment with a Participating Employer in            connection with an early retirement (reduction in force) program            sponsored by the Participating Employer shall, if a participant in            the Wisconsin Public Service Administrative Employees Retirement            Plan, be deemed to have retired upon commencement of retirement            benefits under such plan.

(ii) Distribution Period. Distributions will be made in 1            to 15 annual installments, as elected by the Participant.

(iii) Distribution of Remaining Account Following            Participant's Death. In the event of the Participant's death,            the Participant's remaining undistributed interest will be            distributed to the Beneficiary designated by the Participant in            either a single sum payment or in installments, as elected by the            Participant. If the Participant has elected that death benefits be            paid in a single sum, the payment shall be made no later than March            1 following the calendar year in which occurs the Participant's            death. If the Participant has elected that death benefits be paid in            installments, (A) any installments previously commenced to the            Participant shall continue to the Beneficiary and (B) if installment            distributions had not commenced as of the date of the Participant's            death, payments over the installment period elected by the            Participant shall commence to the Beneficiary no later than March 1            following the calendar year in which occurs the Participant's death.

    (b) Effectiveness of Election. A distribution election shall be deemedmade only when it is received and accepted as complete by the Committee, andshall remain in effect until modified by the Participant in accordance withSection 6.02 below or otherwise revoked in accordance with Plan rules.

    Section 6.02.Modified Distribution Election.
    A Participant may from time to time modify his distribution election byfiling a revised distribution election, properly completed and signed, with theCommittee. However, a revised distribution election will be given effect only ifthe Participant remains employed by a Participating Employer for twelve (12)consecutive months following the date that the revised election is received andaccepted as complete by the Committee.

    Section 6.03.Calculation of Annual Distribution Amount.
    (a) Pre-2001 Retirees. For any Participant whose retirement ortermination date is prior to January 1, 2001, distribution of the Participant'sAccount will be calculated and made under the distribution provisions of thePlan applicable to the Participant on the date of the Participant's retirementor termination of employment.

    (b) Post-2000 Retirees. For a Participant who retires or terminatesemployment after December 31, 2000, the annual distribution amount, unless theCommittee specifies a different or alternate method, shall be calculated asfollows:

(i) The annual distribution amount for the Participant's Account,            other than the portion of the Account that is deemed to be invested            in the Stock Unit Accounts (the "Distributable Account"),            shall be determined by dividing (A) the aggregate balance in the            Distributable Account as of January 1 of the year for which the            distribution is being made, by (B) the number of installment            payments remaining to be made under the distribution period selected            by the Participant. Distributions shall be made in cash. The amount            of any distribution under this Paragraph (i) will be charged            pro-rata against the Participant's interest in each Investment            Option comprising the Distributable Account. Notwithstanding the            foregoing, the last installment payment of the Distributable Account            shall be adjusted to take into account deemed investment gains or            losses for the period between the January 1 valuation date and            the date of actual payment according to such methods and procedures            adopted by the Committee.

(ii) The annual distribution amount for each of the Stock Unit            Accounts shall be determined on a share basis by dividing (A) the            number of WPS Resources Stock Units credited to the relevant Stock            Unit Account as of January 1 of the year for which the distribution            is being made (subject to subsequent adjustment under            Section 7.01), by (B) the number of installment payments            remaining to be made under the distribution period selected by the            Participant, and then rounding the quotient obtained for all but the            final installment to the next lowest whole number of WPS Resources            Stock Units. The Committee will then direct that the Participant            receive shares of WPS Resources Stock and/or cash equal to the            annual distribution amount. For any portion of the distribution that            the Committee directs be satisfied by making a cash payment to the            Participant, the cash payment shall be determined by multiplying the            annual distribution amount (or the portion of the annual            distribution amount being satisfied in cash) by the closing price of            WPS Resources Stock on January 21 of the year in which the            distribution is being made, as such share price is reported in the            Wall Street Journal's New York Stock Exchange Composite Transactions            listing. If January 21 falls on a Saturday, Sunday or holiday, the            calculation of the cash portion of the distributions will be made            based upon the closing price as reported for the immediately            preceding business day. The amount of any distribution under this            Paragraph (ii) will be charged pro-rata against the Participant's            interest in the Incentive Stock Unit Account and the Base Stock Unit            Account.

    Section 6.04.Time of Distribution.
    Subject to the provisions of Sections 7.01 and 8.02, each distributionof WPS Resources Stock made to a Participant (or Beneficiary) shall bedistributed on January 22 (or if January 22 falls on a Saturday, Sunday orholiday, the immediately following business day). For distribution and taxreporting purposes, the value of WPS Resources Stock distributed shall equal thenumber of shares distributed multiplied by the closing price of WPS ResourcesStock on January 21 (or if January 21 falls on a Saturday, Sunday or holiday,the immediately preceding business day) of the year in which the distribution isbeing made as reported in the Wall Street Journal's New York Stock ExchangeComposite Transaction listing. The cash portion of any distribution will be madeno later than March 1 of the year for which the distribution is being made.

    Section 6.05.Other Distribution Rules.
    (a) Limit on Shares. Subject to adjustment as provided in subsection(c) below, the total number of authorized but previously unissued shares of WPSResources Stock which may be distributed to Participants or Beneficiariespursuant to the Plan shall be one hundred fifty thousand (150,000), which numbershall not be reduced by or as a result of (i) any cash distributions pursuant tothe Plan or (ii) the distribution to Participants or Beneficiaries pursuant tothe Plan of any outstanding shares of WPS Resources Stock purchased by or onbehalf of the Trust.

    (b) Tax Withholding. The amount actually distributed to theParticipant will be reduced by applicable income tax withholding. Unless theParticipant has made a contrary election, income tax on the entire annualdistribution amount will be withheld from the cash portion of the distribution,and WPS Resources Stock will be used to satisfy withholding obligations only tothe extent that the cash portion of the distribution is insufficient for thispurpose.

    (c) Adjustments to Stock. In the event of any merger, reorganization,consolidation, recapitalization, separation, liquidation, stock dividend,split-up, share combination or other change in the corporate structure of theCompany or a Participating Employer affecting WPS Resources Stock, suchadjustment shall be made in the number and class of shares which may bedistributed pursuant to the Plan as may be determined to be appropriate andequitable by the Committee in its sole discretion.
** 

ARTICLE VII. RULES WITH RESPECT TO WPS RESOURCES STOCKAND WPS RESOURCES STOCK UNITS**
     Section 7.01.Transactions Affecting WPS Resources Stock.
    In the event of any merger, share exchange, reorganization, consolidation,recapitalization, stock dividend, stock split or other change in corporatestructure of the Company or a Participating Employer affecting WPS ResourcesStock, the Committee may make appropriate equitable adjustments with respect tothe WPS Resources Stock Units (if any) credited to the Stock Unit Accounts ofeach Participant, including without limitation, adjusting the date as of whichsuch units are valued and/or distributed, as the Committee determines isnecessary or desirable to prevent the dilution or enlargement of the benefitsintended to be provided under the Plan.

    Section 7.02.No Shareholder Rights With Respect to WPS Resources Stock Units.
    Participants shall have no rights as a stockholder pertaining to WPSResources Stock Units credited to their Accounts. No WPS Resources Stock Unitnor any right or interest of a Participant under the Plan in any WPS ResourcesStock Unit may be assigned, encumbered, or transferred, except by will or thelaws of descent and distribution. The rights of a Participant hereunder withrespect to any WPS Resources Stock Unit are exercisable during the Participant'slifetime only by him or his guardian or legal representative.
** 

ARTICLE VIII. SPECIAL RULES APPLICABLE IN THE EVENT OF ACHANGE IN CONTROL OF THE COMPANY**
     Section 8.01.Definitions.
    For purposes of this Article VIII, the following terms shall have thefollowing respective meanings:

    (a) An "Affiliate" of, or a person "affiliated" with, aspecified person is a person that directly, or indirectly through one or moreintermediaries, controls, or is controlled by, or is under common control with,the person specified and the term "Associate" used to indicate arelationship with any person, means (i) any corporation or organization (otherthan the registrant or a majority-owned subsidiary of the registrant) of whichsuch person is an officer or partner or is, directly or indirectly, thebeneficial owner of 10 percent or more of any class of equity securities, (ii)any trust or other estate in which such person has a substantial beneficialinterest or as to which such person serves as trustee or in a similar fiduciarycapacity, and (iii) any relative or spouse of such person, or any relative ofsuch spouse, who has the same home as such person or who is a director orofficer of the registrant or any of its parents or subsidiaries.

    (b) A person shall be deemed to be the "Beneficial Owner" of anysecurities:

(i) which such Person or any of such Person's Affiliates or            Associates has the right to acquire (whether such right is            exercisable immediately or only after the passage of time) pursuant            to any agreement, arrangement, or under-standing, or upon the            exercise of conversion rights, exchange rights, or other rights,            warrants or options, or otherwise; provided, however,            that a Person shall not be deemed the Beneficial Owner of, or to            beneficially own, (A) securities tendered pursuant to a tender or            exchange offer made by or on behalf of such Person or any of such            Person's Affiliates or Associates until such tendered securities are            accepted for purchase or (B) securities issuable upon exercise of            Rights pursuant to the terms of the Company's Rights Agreement with            Firstar Trust Company, dated as of December 12, 1996, as amended            from time to time (or any successor to such Rights Agreement) at any            time before the issuance of such securities;

(ii) which such Person or any of such Person's Affiliates or            Associates, directly or indirectly, has the right to vote or dispose            of or has "beneficial ownership" of (as determined            pursuant to Rule 13d-3 of the General Rules and Regulations under            the Act), including pursuant to any agreement, arrangement or            understanding; provided, however, that a Person shall            not be deemed the Beneficial Owner of, or to beneficially own, any            security under this subparagraph (ii) as a result of an agreement,            arrangement or understanding to vote such security if the agreement,            arrangement or understanding: (A) 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 and regulations under the Act and (B) is not            also then reportable on a Schedule 13D under the Act (or any            comparable or successor report); or

(iii) which are beneficially owned, directly or indirectly, by            any other Person with which such Person or any of such Person's            Affiliates or Associates has any agreement, arrangement or            understanding for the purpose of acquiring, holding, voting (except            pursuant to a revocable proxy as described in Paragraph (ii) above)            or disposing of any voting securities of the Company.

    (c) A "Change in Control" shall be deemed to have occurred if:

(i) any Person (other than any employee benefit plan of the            Company or of any subsidiary of the Company, any Person organized,            appointed or established pursuant to the terms of any such benefit            plan or any trustee, administrator or fiduciary of such a plan) is            or becomes the Beneficial Owner of securities of the Company            representing at least 30% of the combined voting power of the            Company's then outstanding securities;

(ii) one-half or more of the members of the Board are not            Continuing Directors;

(iii) there shall be consummated any merger, consolidation, or            reorganization of the Company with any other corporation as a result            of which less than 50% of the outstanding voting securities of the            surviving or resulting entity are owned by the former shareholders            of the Company other than a shareholder who is an Affiliate or            Associate of any party to such consolidation or merger;

(iv) there shall be consummated any merger of the Company or            share exchange involving the Company in which the Company is not the            continuing or surviving corporation other than a merger of the            Company in which each of the holders of the Company's Common Stock            immediately prior to the merger have the same proportionate            ownership of common stock of the surviving corporation immediately            after the merger;

(v) there shall be consummated any sale, lease, exchange or other            transfer (in one transaction or a series of related transactions) of            all, or substantially all, of the assets of the Company to a Person            which is not a wholly owned subsidiary of the Company; or

(vi) the shareholders of the Company approve any plan or proposal            for the liquidation or dissolution of the Company.

    (d) "Continuing Directors" means (i) any member of the Boardof Directors of the Company who was a member of such Board on May 1, 1997,(ii) any successor of a Continuing Director who is recommended to succeed aContinuing Director by a majority of the Continuing Directors then on suchBoard, and (iii) additional directors elected by a majority of theContinuing Directors then on such Board.

    (e) "Person" means any individual, firm, partnership, corporationor other entity, including any successor (by merger or otherwise) of suchentity, or a group of any of the foregoing acting in concert.

    Section 8.02.Amendments in Connection with a Change in Control.
    (a) Board Authority to Amend or Terminate Plan. Prior to theoccurrence of a Change in Control, the Board may exercise its authority underSection 9.06, including, to the extent deemed necessary or desirable by theBoard in anticipation of a Change in Control, any of the following actions:

(i) The Board may amend the Plan to eliminate WPS Resources            Stock Units and cause the value of such units as of the Amendment            Date (such value to be determined under Section 4.04(c)) to be            reallocated to Reserve Account B. The term "Amendment            Date" means the date on which an amendment to the Plan is            validly adopted or the date on which the amendment is or purports to            be effective, whichever is later.

(ii) The Board may terminate the Plan and require that all            benefits accrued to the date of termination (or such later date as            the Board specifies) be distributed to Participants (or            Beneficiaries), in a single sum regardless of a Participant's prior            election as to the form and timing of benefit payments.

    (b) Automatic Amendments. Unless terminated by the Board pursuant tosubsection (a)(ii), the Plan shall automatically be amended upon a Changein Control to provide that:

(i) the rate of interest equivalent to be credited with respect            to Reserve Account A for each month following the Change in Control            shall be the greater of (A) the rate of interest equivalent            otherwise applicable with respect to Reserve Account A if such            amount were calculated based upon the consolidated return on common            shareholders equity of the Company (including for this purpose any            successor corporation that is the survivor of a merger with the            Company or any successor to that corporation) and all subsidiaries,            and (B) a rate equal to two (2) percentage points above the prime            lending rate at Firstar Bank, N.A. (or any successor thereto) as of            the last business day of that month; and

(ii) the rate of interest equivalent to be credited with respect            to Reserve Account B for each month following the Change in Control            shall be the greater of (A) the rate of interest equivalent            otherwise applicable with respect to Reserve Account B if such            amount were calculated based upon the consolidated return on common            shareholders equity of the Company (including for this purpose any            successor corporation that is the survivor of a merger with the            Company or any successor to that corporation) and all subsidiaries,            and (B) a rate equal to two (2) percentage points above the prime            lending rate at Firstar Bank, N.A. (or any successor thereto) as of            the last business day of that month. The minimum rate of interest            equivalent under clause (B) shall cease to apply on the third            anniversary of the Change in Control in the event that the            Participant is actively employed by the Company (or any subsidiary            or affiliate of the Company) on such date.

    (c) Prohibition on Certain Amendments. Notwithstanding the foregoing,on or after the effective date of a Change in Control, the Board or Company maynot, without the written consent of the affected Participant (or in the case ofa deceased Participant, the Participant's Beneficiary) amend the Plan or take anaction to terminate the Plan that would:

(i) Result in a decrease in the number of, or a change in the            type of, Available Investment Options that were made available under            the Plan immediately prior to the Change of Control; or

(ii) Cause the Accounts to be valued under Section 5.01(e) less            frequently than quarterly; or

(iii) Impair or otherwise limit a Participant's rights to            reallocate his Accounts under Section 5.01(f) as in effect on the            date immediately prior to the Change in Control; or

(iv) Decrease the interest rate credited under Reserve Account A            or Reserve Account B as determined pursuant to subsection (b) above,            except as specifically provided therein; or

(v) Eliminate the distribution options made available under            Section 6.02 or otherwise terminate any distribution elections then            in effect.

    Section 8.03.Maximum Payment Limitation.
    (a) Limit on Payments. Except as provided in subsection (b) below, ifany portion of the payments or benefits described in this Plan or under anyother agreement with or plan of the Company (in the aggregate, "TotalPayments"), would constitute an "excess parachute payment", thenthe Total Payments to be made to the Participant shall be reduced such that thevalue of the aggregate Total Payments that the Participant is entitled toreceive shall be one dollar ($1) less than the maximum amount which theParticipant may receive without becoming subject to the tax imposed by Section4999 of the Code or which the Company may pay without loss of deduction underSection 280G(a) of the Code; provided that this Section shall not apply in thecase of a Participant who has in effect a valid employment contract providingthat the Total Payments to the Participant shall be determined without regard tothe maximum amount allowable under Section 280G of the Code. The terms"excess parachute payment" and "parachute payment" shallhave the meanings assigned to them in Section 280G of the Code, and such"parachute payments" shall be valued as provided therein. Presentvalue shall be calculated in accordance with Section 280G(d)(4) of the Code.Within forty (40) days following delivery of notice by the Company to theParticipant of its belief that there is a payment or benefit due the Participantwhich will result in an excess parachute payment as defined in Section 280G ofthe Code, the Participant and the Company, at the Company's expense, shallobtain the opinion (which need not be unqualified) of nationally recognized taxcounsel selected by the Company's independent auditors and acceptable to theParticipant in his sole discretion (which may be regular outside counsel to theCompany), which opinion sets forth (A) the amount of the Base Period Income, (B)the amount and present value of Total Payments and (C) the amount and presentvalue of any excess parachute payments determined without regard to thelimitations of this Section. As used in this Section, the term "Base PeriodIncome" means an amount equal to the Participant's "annualizedincludible compensation for the base period" as defined in Section280G(d)(1) of the Code. For purposes of such opinion, the value of any noncashbenefits or any deferred payment or benefit shall be determined by the Company'sindependent auditors in accordance with the principles of Sections 280G(d)(3)and (4) of the Code, which determination shall be evidenced in a certificate ofsuch auditors addressed to the Company and the Participant. Such opinion shallbe addressed to the Company and the Participant and shall be binding upon theCompany and the Participant. If such opinion determines that there would be anexcess parachute payment, the payments hereunder that are includible in TotalPayments or any other payment or benefit determined by such counsel to beincludible in Total Payments shall be reduced or eliminated as specified by theParticipant in writing delivered to the Company within thirty days of hisreceipt of such opinion or, if the Participant fails to so notify the Company,then as the Company shall reasonably determine, so that under the bases ofcalculations set forth in such opinion there will be no excess parachutepayment. If such legal counsel so requests in connection with the opinionrequired by this Section, the Participant and the Company shall obtain, at theCompany's expense, and the legal counsel may rely on in providing the opinion,the advice of a firm of recognized executive compensation consultants as to thereasonableness of any item of compensation to be received by the Participant. Ifthe provisions of Sections 280G and 4999 of the Code (or any successorprovisions) are repealed without succession, then this Section shall be of nofurther force or effect.

    (b) Employment Contract Governs. The provisions of subsection (a)above shall not apply to a Participant whose employment is governed by anemployment contract that provides for Total Payments in excess of the limitationdescribed in subsection (a) above.

    Section 8.04.Resolution of Disputes.
    If, after a Change in Control, (a) a dispute arises with respect to theenforcement of the Participant's rights under the Plan, or (b) any legalproceeding shall be brought to enforce or interpret any provision contained inthe Plan or to recover damages for breach of the Plan, in either case so long asthe Participant is not acting in bad faith or otherwise pursuing a course ofaction that a reasonable person would determine to be frivolous, the Participantshall recover from the Company any reasonable attorneys' fees and necessarycosts and disbursements incurred as a result of such dispute or legal proceeding("Expenses"), and prejudgment interest on any money judgment obtainedby the Participant calculated at the rate of interest announced by Firstar BankMilwaukee, Milwaukee, Wisconsin (or any successor thereto), from time to time asits prime or base lending rate from the date that payments to the Participantshould have been made under this Plan. Within ten (10) days after theParticipant's written request therefor, the Company shall pay to theParticipant, or such other person or entity as the Participant may designate inwriting to the Company, the Participant's Expenses in advance of the finaldisposition or conclusion of any such dispute or legal proceeding. In the caseof a deceased Participant, this Section shall apply with respect to theParticipant's Beneficiary or estate.
** 

ARTICLE IX. GENERAL PROVISIONS**
     Section 9.01.Administration.
    The Committee shall administer and interpret the Plan and supervisepreparation of Participant elections, forms, and any amendments thereto. To theextent necessary to comply with applicable conditions of Rule 16b-3, theCommittee shall consist of not less than two members of the Board, each of whomis also a director of the Company and qualifies as a "non-employeedirector" for purposes of Rule 16b-3. If at any time the Committee shallnot be in existence or not be composed of members of the Board who qualify as"non-employee directors", then all determinations affectingParticipants who are subject to Section 16 of the Exchange Act shall be made bythe full Board, and all determinations affecting other Participants shall bemade by the Board or an officer of the Board. The Committee may, in itsdiscretion, delegate any or all of its authority and responsibility; providedthat the Committee shall not delegate authority and responsibility with respectto non-ministerial functions that relate to the participation by Participantswho are subject to Section 16 of the Exchange Act at the time any such delegatedauthority or responsibility is exercised. To the extent of any such delegation,any references herein to the Committee shall be deemed references to suchdelegee. Interpretation of the Plan shall be within the sole discretion of theCommittee and shall be final and binding upon each Participant and Beneficiary.The Committee may adopt and modify rules and regulations relating to the Plan asit deems necessary or advisable for the administration of the Plan. If anydelegee of the Committee shall also be a Participant or Beneficiary, anydeterminations affecting the delegee's participation in the Plan shall be madeby the Committee.

    Section 9.02.Restrictions to Comply with Applicable Law.
    (a) General Restrictions. Notwithstanding any other provision of thePlan, the Company shall have no liability to deliver any shares of WPS ResourcesStock under the Plan or make any payment unless such delivery or payment wouldcomply with all applicable laws and the applicable requirements of anysecurities exchange or similar entity. In addition, transactions under the Planare intended to comply with all applicable conditions of Rule 16b-3 under theExchange Act. The Committee shall administer the Plan so that transactions underthe Plan will be exempt from Section 16 of the Exchange Act, and shall have theright to restrict any transaction, or impose other rules and requirements, tothe extent it deems necessary or desirable for such exemption to be met.

    (b) Restriction on Transfer. Shares of WPS Resources Stock issuedunder the Plan may not be sold or otherwise disposed of except (i) pursuant toan effective registration statement under the Act, or in a transaction which, inthe opinion of counsel for the Company, is exempt from registration under theAct; and (ii) in compliance with state securities laws. Further, as a conditionto issuance of shares of WPS Resources Stock under the Plan, the Participant,his Beneficiary or his heirs, legatees or legal representatives, as the case maybe, shall execute and deliver to the Company a restrictive stock transferagreement in such form, and subject to such terms and conditions, as shall bereasonably determined or approved by the Committee, which agreement, among otherthings, may impose certain restrictions on the sale or other disposition of anyshares of stock acquired under the Plan. The Committee may waive the foregoingrestrictions, in whole or in part, in any particular case or cases or mayterminate such restrictions whenever the Committee determines that suchrestrictions afford no substantial benefit to the Company.

    (c) Additional Restrictions; Legends. All shares of WPS ResourcesStock delivered under the Plan shall be subject to such stock transfer ordersand other restrictions as the Committee may deem advisable under the Plan andany applicable federal or state securities laws, and the Committee may cause alegend or legends to be put on any certificates to make appropriate referencesto such restrictions.

    Section 9.03.Claims Procedures.
    (a) If a Participant or Beneficiary believes that he or she has not receivedthe full benefit provided for in the Plan, the Participant or Beneficiary file aclaim for benefits with the Committee. If the Committee denies the claim, theCommittee shall deliver to the claimant a written explanation setting forth thespecific reasons for the denial, pertinent references to the Plan section onwhich the denial is based, such other information as may be pertinent and adescription of the procedures to be followed by the claimant in obtaining areview of his or her claim. For purposes of this paragraph, the claimant's claimshall be deemed filed when presented in writing to the Committee and theCommittee's explanation shall be provided to the claimant within ninety (90)days of the date the claim is filed.

    (b) The claimant shall be provided sixty (60) days following his or herreceipt of the denial of the claim to file a written request for appeal to theCommittee. The claimant and his or her representative may present additionalinformation or documents pertinent to the Committee's review. The Committeeshall decide the issue on appeal, which decision shall be final, and furnish theclaimant with a written decision of his or her claim on review within sixty (60)days of receipt of claimant's request for appeal. The Committee's decision shallindicate the specific reasons for the decision and the pertinent provisions ofthe Plan on which the decision is based. If the Committee does not furnish awritten decision to the claimant within such sixty (60) day period, the claimshall be deemed denied on appeal.

    Section 9.04.Participant Rights Unsecured.
    (a) Unsecured Claim. The right of a Participant or his Beneficiary toreceive a distribution hereunder shall be an unsecured claim, and neither theParticipant nor any Beneficiary shall have any rights in or against any amountcredited to his Account or any other specific assets of a ParticipatingEmployer. The right of a Participant or Beneficiary to the payment of benefitsunder this Plan shall not be assigned, encumbered, or transferred, except bywill or the laws of descent and distribution. The rights of a Participanthereunder are exercisable during the Participant's lifetime only by him or hisguardian or legal representative.

    (b) Contractual Obligation. The Company may authorize the creation ofa trust or other arrangements to assist it in meeting the obligations createdunder the Plan. However, any liability to any person with respect to the Planshall be based solely upon any contractual obligations that may be createdpursuant to the Plan. No obligation of a Participating Employer shall be deemedto be secured by any pledge of, or other encumbrance on, any property of aParticipating Employer. Nothing contained in this Plan and no action takenpursuant to its terms shall create or be construed to create a trust of anykind, or a fiduciary relationship between a Participating Employer and anyParticipant or Beneficiary, or any other person.

    Section 9.05.Income Tax Withholding.
    No later than the date as of which an amount first becomes includible in thegross income of the Participant for Federal income tax purposes, the Participantshall pay or make arrangements satisfactory to the Committee regarding thepayment of, any Federal, state, local or foreign taxes of any kind required bylaw to be withheld with respect to such amount.

    Section 9.06.Amendment or Termination of Plan.
    There shall be no time limit on the duration of the Plan. Except as otherwiselimited pursuant to Section 8.02, the Board (or where specified herein, theCommittee) may at any time amend or terminate the Plan, including but notlimited to modifying the terms and conditions applicable to (or otherwiseeliminating) Deferrals to be made on or after the amendment or termination date;provided, however, that no amendment or termination may reduce or eliminate anyAccount balance accrued to the date of such amendment or termination (except assuch Account balance may be reduced as a result of investment losses allocableto such Account).

    Section 9.07.Administrative Expenses.
    Costs of establishing and administering the Plan will be paid by theParticipating Employers.

    Section 9.08.Effect on Other Employee Benefit Plans.
    Deferrals credited to a Participant's Account under this Plan shall not beconsidered "compensation" for the purpose of computing benefits underany qualified retirement plan maintained by a Participating Employer, but shallbe considered compensation for welfare benefit plans, such as life anddisability insurance programs sponsored by a Participating Employer, unlessotherwise specifically provided by the terms of such plan.

    Section 9.09.Successors and Assigns.
    This Plan shall be binding upon and inure to the benefit of the ParticipatingEmployers, their successors and assigns and the Participants and their heirs,executors, administrators, and legal representatives.