Document:

ex10-1.htm

     

    Exhibit
      10.1

    
 

    SEPARATION
      AGREEMENT AND RELEASE

    

    This
      Separation Agreement and Release (this “Agreement”), dated
      as
      of February 25, 2008, is by and between Proxim Wireless Corporation, a Delaware
      corporation (“Proxim”), and Robert
      E. Fitzgerald (“Mr.
      Fitzgerald”) to resolve certain issues between the parties.

    

    WHEREAS,
      Mr. Fitzgerald has been employed by Proxim pursuant to an Employment Agreement,
      dated as of February 9, 2005 (the “Employment
      Agreement”) between Mr. Fitzgerald and Proxim;

    

    WHEREAS,
      Mr. Fitzgerald’s employment was terminated effective February 15, 2008 (the
“Separation
      Date”); and

    

    WHEREAS,
      Mr. Fitzgerald desires to provide Proxim with a Release of any and all claims
      against Proxim in accordance with Section 7.11 of the Employment
      Agreement;

    

    NOW
      THEREFORE, in consideration of the mutual promises made herein, Mr. Fitzgerald
      and Proxim hereby agree as follows:

    

    1.          Separation
      Date.  Mr. Fitzgerald and Proxim agree that Mr. Fitzgerald’s
      last day of employment with Proxim (and all of its affiliated companies) was
      the
      Separation Date.  Subject to Mr. Fitzgerald’s right to continue his
      health insurance under COBRA and except as otherwise specifically contemplated
      in this Agreement, Mr. Fitzgerald shall not receive or be entitled to any
      salary, bonus, incentive compensation, severance, or other payments or benefits
      from Proxim after the Separation Date and Mr. Fitzgerald’s right to participate
      in all benefits and incidents of employment (including, but not limited to,
      the
      accrual of vacation and paid time off) ceased on the Separation
      Date.  Mr. Fitzgerald agrees to return to Proxim, on or before the
      date of this Agreement, all property of Proxim, including without limitation
      all
      computers, products, samples, documents, papers, records, notes, credit cards,
      entry cards, access passes, keys, customer information, and computer
      files.

     

    2.         Payments.

     

    (a)           
      The parties acknowledge and agree that through the Separation Date, Proxim
      continued to pay Mr. Fitzgerald at a rate of his base annual salary of Three
      Hundred Thirty Thousand and 00/100 Dollars ($330,000.00) (less deductions
      authorized or required by law) in accordance with its normal payroll
      practices.

     

    (b)           
      The parties acknowledge and agree that, on the Separation Date, Proxim sent
      Mr.
      Fitzgerald a check payable to him for (i) any base salary accrued for services
      performed prior to the Separation Date but not yet then paid and (ii) his
      accrued but unused paid time off in the amount of $54,918.28 (less deductions
      authorized or required by law). Mr. Fitzgerald acknowledges receipt of that
      check.

     

    (c)           
      On the Effective Date as described in Section 11 below, Proxim shall pay to
      Mr.
      Fitzgerald (i) the sum of Four Hundred Ninety-Five Thousand and 00/100 Dollars
      (US $495,000.00) (less deductions authorized or required by law), which amount
      the parties agree is

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    equal
      to
      twelve (12) months of salary at Mr. Fitzgerald’s current base salary rate plus a
      bonus amount calculated at six (6) months of performance at target levels and
      (ii) his 2007 bonus in the amount of $232,650 (less deductions authorized or
      required by law).

     

    3.          
      Stock
      Options.  Mr. Fitzgerald’s options to purchase Proxim common
      stock ceased to vest on the Separation Date.  On the Separation Date,
      all unvested stock options were forfeited.  On that date, the parties
      agree that Mr. Fitzgerald had vested stock options to purchase the following
      numbers of shares of Proxim common stock for the following per share exercise
      prices pursuant to stock option agreements with the following
      dates:

     

    
      	
              Date
                of Agreement

            	
              Number
                of Vested Options

            	
              Exercise
                Price

            
	
              1/30/04

            	
              40,000

            	
              $6.99

            
	
              12/7/04

            	
              50,000

            	
              $2.72

            
	
              2/9/05

            	
              500,000 

            	
              $3.34

            

    

    

    Mr.
      Fitzgerald may exercise his vested stock options in accordance with the terms
      of
      the appropriate stock option agreement; provided, however, that the vested
      stock
      options shall remain exercisable for twelve (12) months after the Separation
      Date (through February 15, 2009) notwithstanding any shorter period of
      exercisability set forth in any applicable stock option agreement (but in no
      event later than the expiration date of the applicable option).  Mr.
      Fitzgerald acknowledges that incentive stock options will receive the tax
      treatment afforded to incentive stock options only if exercised within 90 days
      after the Separation Date (and the other requirements for incentive stock
      options are satisfied).

    

    4.         
      Benefits.

     

    (a)           
      For a period of twelve (12) months after the Separation Date, Proxim shall
      pay
      the full premium cost for the following benefit plans:

     

    (i)           
      coverage for Mr. Fitzgerald and his eligible dependents at their existing level
      of care under Proxim’s existing or equivalent medical insurance plan; provided, however, that such
      coverage shall continue at the existing level of care only to the extent then
      permitted by the terms of such plan or any amended or successor
      plan;

     

    (ii)           
      life insurance providing a death benefit of at least Six Hundred Sixty Thousand
      and 00/100 Dollars ($660,000.00);

     

    (iii)           
      disability benefits in accordance with Proxim’s then standard disability
      insurance coverage; and

     

    (iv)           
      accidental death and dismemberment insurance providing a benefit of up to Six
      Hundred Sixty Thousand and 00/100 Dollars ($660,000.00).

     

    (b)           
      To the extent any of the plans described in Section 4(a) above do not permit
      his
      continued participation, Proxim shall pay Mr. Fitzgerald a lump sum equal to
      the
      economic equivalent of such coverage for the contemplated period of
      time.

     

    
      
        
        

      

      
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    (c)           
      Notwithstanding the foregoing Sections 4(a) and 4(b), Proxim’s obligation to
      continue benefits pursuant to Section 4(a) above or to make a payment in lieu
      of
      continued benefits pursuant to Section 4(b) above shall cease if and when Mr.
      Fitzgerald becomes covered under similar plans of a new employer (in which
      case,
      Mr. Fitzgerald shall return to Proxim a pro rata portion of any lump sum payment
      made by Proxim in lieu of continuing the benefits).

     

    5.         
      Acknowledgement
      of
      Receipt of All Other Payments.  Mr. Fitzgerald acknowledges and
      represents that, other than the payments contemplated in this Agreement, Proxim
      (or one of its affiliated companies) has paid all salary, wages, bonuses,
      incentive compensation, accrued vacation, housing allowances, relocation costs,
      interest, severance, stock, stock options, outplacement costs, fees,
      commissions, and any and all other benefits and compensation due to Mr.
      Fitzgerald.  Mr. Fitzgerald acknowledges and represents that Proxim
      (or one of its affiliated companies) has reimbursed Mr. Fitzgerald for all
      reimbursable costs and expenses incurred by Mr. Fitzgerald on behalf of Proxim
      (or one of its affiliated companies) on or before the date of this
      Agreement.  In the interests of settling these issues with Mr.
      Fitzgerald, Proxim agrees to pay Mr. Fitzgerald the sum of $12,342.85 for
      disputed expense reimbursement claims, which payment shall be made on the
      Effective Date.

     

    6.         
      General Release
      of
      Claims.

     

    (a)           
      In consideration of the benefits provided to Mr. Fitzgerald described in this
      Agreement, Mr. Fitzgerald hereby agrees and covenants not to sue and not to
      make
      any claims of any kind against Proxim, any of its past and present divisions,
      subsidiaries, affiliates or related companies, any of the successors or assigns
      of Proxim or any of these entities, and all past and present directors,
      officers, employees, shareholders, partners, members, managers, advisors,
      representatives, attorneys, accountants, and agents of any of the foregoing
      entities (collectively the “Releasees”) before
      any court, agency, tribunal, authority or other forum, and Mr. Fitzgerald
      further agrees to, and hereby does, on behalf of himself and his heirs,
      executors, administrators, personal representatives and permitted assigns,
      fully
      and forever release and discharge the Releasees for and from any and all claims,
      charges, complaints, lawsuits, damages, contracts and causes of action at law
      or
      in equity, of any nature whatsoever, and any and all other actions in any court,
      agency, tribunal, authority or other forum, in each case whether known or
      unknown, suspected or unsuspected, accrued or contingent, from the beginning
      of
      time up to and including the date of this Agreement, that Mr. Fitzgerald may
      have against any of them, including, without limitation:

     

    (i)           
      any and all claims relating to or arising from Mr. Fitzgerald’s employment
      relationship with Proxim (or any of its affiliated companies) and the
      termination of that relationship;

     

    (ii)           
      any and all claims relating to, or arising from, Mr. Fitzgerald’s right to
      purchase, or actual purchase of shares of stock of Proxim (or any of its
      affiliated companies), including, without limitation, any claims for fraud,
      misrepresentation, breach of fiduciary duty, breach of duty under applicable
      state corporate law, and securities fraud under any state or federal
      law;

     

    
      
        
        

      

      
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    (iii)           
      any and all claims for wrongful discharge of employment; termination in
      violation of public policy; discrimination; breach of contract, both express
      and
      implied; breach of a covenant of good faith and fair dealing, both express
      and
      implied; promissory estoppel; negligent or intentional infliction of emotional
      distress; negligent or intentional misrepresentation; negligent or intentional
      interference with contract or prospective economic advantage; unfair business
      practices; defamation; libel; slander; negligence; personal injury; assault;
      battery; invasion of privacy; false imprisonment; and conversion;

     

    (iv)           
      any and all claims for violation of any federal, state or municipal statute,
      including, but not limited to, Title VII of the Civil Rights Act of 1964, the
      Civil Rights Act of 1991, the Age Discrimination in Employment Act of 1967
      (the
“ADEA”), the Americans with Disabilities Act of 1990, the Fair Labor Standards
      Act, the Employee Retirement Income Security Act of 1974, the Worker Adjustment
      and Retraining Notification Act, the Older Workers Benefit Protection Act;
      the
      California Fair Employment and Housing Act; and Labor Code section 201, et
      seq.
      and section 970, et seq.;

     

    (v)           
      any and all claims for violation of the federal, or any state,
      constitution;

     

    (vi)           
      any and all claims arising out of any other laws and regulations relating to
      employment or employment discrimination; and

     

    (vii)           
      any and all claims for attorneys’ fees and costs.

     

    This
      release does not apply to any claims relating solely to indemnification,
      contribution, or insurance coverage.  Mr. Fitzgerald acknowledges and
      agrees that, without the release of claims set forth herein, he would not
      receive the payments and benefits set forth in this Agreement.

    

    (b)           
      Mr. Fitzgerald understands and agrees that, except as set forth therein, Section
      6(a) above is a full and final release covering all known as well as unknown
      or
      unanticipated debts, claims, or damages Mr. Fitzgerald may have against the
      Releasees.  Mr. Fitzgerald represents that he is not aware of any
      claims against any of the Releasees.  Mr. Fitzgerald acknowledges that
      he has been advised to consult with legal counsel and is familiar with the
      provisions of California Civil Code Section 1542.  Therefore, Mr.
      Fitzgerald hereby expressly waives any and all rights or benefits which he
      may
      now have, or in the future may have, under the terms of Section 1542 of the
      California Civil Code, which provides as follows (or any other statute or common
      law principle with a similar effect):

     

    A
      GENERAL
      RELEASE DOES NOT EXTEND TO CLAIMS WHICH THE CREDITOR DOES NOT KNOW OR SUSPECT
      TO
      EXIST IN HIS OR HER FAVOR AT THE TIME OF EXECUTING THE RELEASE, WHICH IF KNOWN
      BY HIM OR HER MUST HAVE MATERIALLY AFFECTED HIS OR HER SETTLEMENT WITH THE
      DEBTOR.

    

    (c)           
      Notwithstanding the release of claims set forth in this Agreement, it is
      expressly understood that nothing in this Agreement will prevent Mr. Fitzgerald
      from filing a charge of discrimination with the Equal Employment Opportunity
      Commission or any of its state

     

    
      
        
        

      

      
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    or
      local
      deferral agencies, or participating in any investigation by the Equal Employment
      Opportunity Commission or any of its state or local deferral agencies, although
      Mr. Fitzgerald understands that by signing this Agreement, Mr. Fitzgerald waives
      the right to recover any damages or to receive other relief in any claim or
      suit
      brought by or through the Equal Employment Opportunity Commission or any other
      state or local deferral agency on behalf of Mr. Fitzgerald.

     

    (d)           
      Nothing in this Agreement prevents or precludes Mr. Fitzgerald from challenging
      or seeking a determination in good faith of the validity of this waiver under
      the ADEA, nor does it impose any condition precedent, penalties or costs for
      doing so, unless specifically authorized by federal law.

     

    (e)           
      Nothing in this Agreement modifies Proxim’s obligations to Mr. Fitzgerald for
      any claims for indemnification or contribution, if any.

     

    7.         
      Opportunity to
      Review.  Mr. Fitzgerald acknowledges that Mr. Fitzgerald has
      been given a reasonable period of at least twenty-one (21) days in which to
      consider this Agreement prior to signing.  Mr. Fitzgerald acknowledges
      that, if Mr. Fitzgerald decides to execute this Agreement prior to the
      expiration of the twenty-one (21) day period, it is solely Mr. Fitzgerald’s
      decision and Proxim has not induced Mr. Fitzgerald to do so.

     

    8.         
      Careful Review and
      Understanding of Agreement.  Mr. Fitzgerald represents that Mr.
      Fitzgerald has read carefully and fully understands the terms of this
      Agreement.

     

    9.         
      Opportunity to Consult
      with Counsel.  Mr. Fitzgerald acknowledges and represents that
      Mr. Fitzgerald has been advised to, and has had the opportunity to, consult
      with
      counsel of Mr. Fitzgerald’s choice prior to signing this Agreement.

     

    10.       
      Free and Voluntary
      Act.  Mr. Fitzgerald represents that Mr. Fitzgerald is entering
      into this Agreement freely and voluntarily.

     

    11.       
      Opportunity to Revoke;
      Effective Date.  Mr. Fitzgerald will have up to seven (7) days
      following Mr. Fitzgerald’s signing of this Agreement and delivering it to Proxim
      to revoke Mr. Fitzgerald’s acceptance by so notifying Proxim in
      writing.  If Proxim does not receive a written revocation during that
      seven day period, this Agreement will automatically take effect on the eighth
      (8th)
      day
      following Mr. Fitzgerald’s signing and delivery of it, which eighth (8th)
      day
      will be the Effective Date.  Notwithstanding any other
      provision
      of this Agreement to the contrary, all obligations of Proxim under this
      Agreement are contingent upon the occurrence of, and shall not bind Proxim
      until, the Effective Date.

     

    12.       
      Continuation of
      Agreements.  Mr. Fitzgerald and Proxim agree that the
      provisions of Sections 9, 10, 11, 13 and 14 of the Employment Agreement shall
      survive the termination of Mr. Fitzgerald’s employment and remain in force and
      effect.  Mr. Fitzgerald specifically acknowledges that any other
      agreements entered into by him with Proxim or its affiliates relating to
      inventions, non-competition, restrictive covenants, and confidential and/or
      proprietary information remain in full force and effect in accordance with
      their
      terms.

     

    
      
        
        

      

      
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    13.       
      Governing
      Law.  This Agreement will be governed by, and interpreted and
      construed for all purposes under, the internal laws of the Commonwealth of
      Virginia.

     

    14.       
      Arbitration.  Any
      controversy or claim arising out of or relating to this Agreement shall be
      settled exclusively by final and binding arbitration in accordance with the
      Commercial Arbitration Rules of the American Arbitration Association (“AAA”)
      then in effect, conducted by a panel of three (3) arbitrators, either mutually
      agreed upon by the parties or selected in accordance with the AAA Rules, and
      judgment on any award rendered by the arbitrator(s) may be entered in any court
      having proper jurisdiction.  This Section 14 does not limit a party’s
      right to seek preliminary injunctive or other equitable relief from a court
      or
      an arbitrator pending arbitral determination of controversies or claims under
      this Section 14.   Each party to the dispute shall be responsible
      for its own cost of the arbitration, including attorney fees pertaining to
      the
      dispute.  Further, Proxim will continue to provide Mr. Fitzgerald with
      benefit coverage during the arbitration proceedings to the extent otherwise
      required by this Agreement.

     

    15.       
      Amendment and
      Waiver.  This Agreement may be amended, and any provision of
      this Agreement may be waived, only by a writing signed by Mr. Fitzgerald and
      a
      duly authorized officer of Proxim.  No waiver of any breach or rights
      shall be deemed a waiver of any subsequent breach or rights.

     

    [SIGNATURE
      PAGE FOLLOWS]

    

     

     

     

    
 

    
      
        
        

      

      
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    IN
      WITNESS WHEREOF, each of the parties has caused this Agreement to be signed
      as
      of the date first written above.

    

    

    
      	
              Proxim
                Wireless Corporation

              
              

              
              

              
              

              By:  /s/
                David L.
                Renauld

              Name:
                David L. Renauld

              Title:  
                Vice President

              Date:  
                February 25, 2008

              
              

            	
              
              

              
              

              
              

              
              

              /s/
                Robert E.
                Fitzgerald

              Name:  Robert
                E. Fitzgerald

              
              

              Date:  February
                25, 2008

            
	 	
              
              

              Signature
                witnessed by:

              
              

              
              

              
              

              /s/
                Joyce F.
                DeHaven

              Witness
                Name (printed): Joyce F. DeHaven

              
              

            

    

    

     

     

     

    7exh105.htm

    
 

    Exhibit
      10.5

    INTEGRYS
      ENERGY GROUP, INC.

    PERFORMANCE
      STOCK RIGHT AGREEMENT

    

     

    THIS
      AGREEMENT is entered into as of May
      17, 2007, (the “Grant
      Date”), by and between INTEGRYS ENERGY GROUP, INC.(the “Company”), and __________________
      ____________________ (the “Participant”).  This Agreement sets forth
      the terms, rights and obligations of the parties with respect to the grant
      of
      Performance Stock Rights to the Participant.  This agreement shall not
      become effective until the Participant signs and returns the “Acknowledgement
      Form” attached hereto.

     

    The
      Performance Stock Rights are granted
      under, and are subject to, the terms of the Integrys Energy Group, Inc.
      2007Omnibus Incentive
      Compensation Plan (the “Plan”), which are specifically incorporated by reference
      in this Agreement.  Any capitalized terms used in this Agreement which
      are not defined shall have the meaning set forth in the
      Plan.

     

    The
      parties to this Agreement covenant
      and agree as follows:

     

    1. Grant
      of
      Performance Stock Rights.  (a)  Subject
      to the terms of this
      Agreement, the Company grants to the Participant Performance Stock Rights
      representing the right to receive ______ shares (“Target Award”), of the common
      stock of the Company, par value $1.00 (“Stock”), in the event certain
      Performance Goals specified herein are satisfied.  The Participant
      obtains no ownership interest in the Company and will not be considered a
      shareholder of the Company by virtue of the grant of Performance Stock Rights
      hereunder until such time as Stock may be issued to the Participant as a Final
      Award.

     

    (b) In
      the event of certain corporate
      transactions described in Section 12 of the Plan, the number of Performance
      Stock Rights willbe
      adjusted by the Compensation
      Committee of the Board of Directors of the Company (the
“Committee”).  The Committee’s determination as to any adjustment
      shall be final.

     

    2. Performance
      Period. Subject to the
      provisions of Section 7, the period from April 1, 2007to December 31, 2009.

     

    3. Performance
      Measures.

     

    (a) Total
      Shareholder Return (“TSR”).  The quotient obtained
      by
      dividing (1) the Shareholder Return with respect to a share of common
      stockof the
      Company, by (2) the
      Beginning Market Price of a share of common stockof the Company.  For
      this
      purpose:

     

    (1) The
      Shareholder Return means the cash
      dividends paid on a share of common stock during the Performance Period,
      increased by (if positive) or reduced by (if negative) the change in stock
      price
      from the Beginning Market Price of a share of common stock to the Ending Market
      Price of a share of common stock.

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

       

    

    (2) The
      Beginning Market Price of a share of
      common stock is the average closing market price of a share of common stock
      for
      the 30 trading days immediately preceding the first day of the Performance
      Period as reported by the securities exchange on which such stock is principally
      traded.

     

    (3) The
      Ending Market Price of a share of
      common stock is the average closing market price of a share of common stock
      for
      the 30 trading days immediately preceding the last day of the Performance Period
      as reported by the securities exchange on which such stock is principally
      traded.

     

    (b) Comparison
      Group.  All of
      the companies included in the Towers Perrin database of publicly traded electric
      power companies.

     

    4. Determination
      of Final Awards.

     

    (a) Presumptive
      Award.  As soon
      as practicable following the completion of the Performance Period, the Committee
      will determine the TRS of the Company and of each company in the Comparison
      Group. The Committee’s determination will be final and binding on all
      persons.  The Participant’s presumptive award shall be determined in
      accordance with the following table; provided that any fractional share of
      Stock
      that would otherwise result from the foregoing calculation shall be
      disregarded.

     

    
      
        	 

                Company
                  TSR In Relation
                  to

                TSR
                  of All Comparison
                  Group

                Companies

              	 

                Presumptive
                  Award Equal
                  to

                the
                  Following Percentage
                  of

                the
                  Target Award*

              
	 	 
	 90thPercentile
                or
                Greater	200% 
	 75thPercentile	150% 
	 50thPercentile	100% 
	 25thPercentile	 50%
	 Below
                the 25thPercentile	
                 0%

              

      

    

     

    *
      The Presumptive Award for performance
      between points on the payout schedule would be interpolated.

    

    (b) Final
      Award.  The
      Presumptive Award is used as a guideline for the Committee in determining the
      Final Award to be made to the Participant, and the Participant obtains no rights
      as a result of the determination of the Presumptive Award.  In
      determining the Final Award to be made to the Participant, the Committee, in
      its
      sole discretion, may increase or decrease the amount of the Presumptive Award;
      provided that the Committee will not increase the amount of the Presumptive
      Award applicable to the Participant if the Final Award is intended to comply
      with Section 162(m) of the Internal Revenue Code and if the Participant is
      a
      Covered Executive (as defined in the Plan) for purposes of Section 162(m) of
      the
      Internal Revenue Code.  

     

    
      
        
        

      

      
        -2-

        
          

        

      

      
        
        

      

    

     

    Except
      with respect to the portion (if
      any) of the Final Award payment of which is deferred in accordance with the
      Integrys Energy Group, Inc.Deferred Compensation
      Plan, the Final
      Award will be distributed to the Participant by March 15 of the calendar year
      following the calendar year in which the Performance Period
      ends..

     

    5. Dividend
      Equivalents.  The
      Participant shall not receive any cash or other consideration to reflect
      dividends that would have been paid or accrued had the Performance Stock Rights
      been actual shares of Stock during the Performance Period.

     

    6. Effect
      of
      Termination of Employment.

     

    (a) Except
      as set forth in subsection (b)
      below and Section 8 below, or as otherwise determined by the Committee, the
      Performance Stock Rights will be cancelled immediately and without notice to
      the
      Participant, and no Final Award will be made, in the event of the Participant’s
      termination of employment from the Company and its Affiliates prior to the
      last
      day of the Performance Period.

     

    (b) The
      Participant’s Performance Stock
      Rights will not be cancelled upon termination of employment, and the Participant
      (or the Participant’s estate) may be eligible to receive a Final Award,
      determined in accordance with Section 4 and this Section 6(b) following the
      conclusion of the Performance Period, if: (i) the Participant’s termination of
      employment is on account of death or disability (as defined in the Company’s
      long-term disability plan), or (ii) the Participant terminates employment on
      or
      after December 31 of the calendar year in which the Performance Period began
      and
      such termination is on account of retirement on or after age
      fifty-five.  Except with respect to the portion (if any) of the Final
      Award payment of which is deferred in accordance with the Integrys Energy Group,
      Inc. Deferred Compensation
      Plan, the Final Award will be distributed to the Participant by March 15 of
      the
      calendar year following the calendar year in which the Performance Period
      ends.

     

    7. Change
      in
      Control.  Upon
      the occurrence of a Change of Control (as defined in the Plan), the Performance
      Period shall be terminated, and the Participant will be entitled to a Final
      Award based upon the Target Award (or, if greater, the then projected Final
      Award) prorated for the portion of the Performance Period that has been
      completed as of the date of the Change in Control. Except with respect to
      the portion (if
      any) of the Final Award payment of which is deferred in accordance with the
      Integrys Energy Group, Inc. Deferred Compensation Plan, distribution
will be made as soon
      as is
      administratively practicable following the Change of Control; provided, that
      if
distribution following
      the
      Change of Control would result in the Participant being subject to imposition
      of
      an additional tax under Code Section 409A, distribution of the Final Award
      will
      be made (without interest) as soon as administratively practicable following
      the
      earlier to occur of (i) the date on which the Participant separates from the
      service of the Company and all affiliates (six months following the date of
      separation if Participant qualifies as a “specified employee” as that term is
      defined for purposes of Section 409A of the Internal Revenue Code), or (ii)
      the
      date that distribution would otherwise have been made under Section 4 had the
      Change of Control not occurred.

     

    
      
        
        

      

      
        -3-

        
          

        

      

      
        
        

      

    

     

    8. Tax
      Withholding.  Upon the issuance of
      Stock
      pursuant to a Final Award, the Company may satisfy its withholding obligations
      in any manner determined by the Committee, including by withholding a portion
      of
      the Participant’s compensation or by withholding a number of the shares of Stock
      included in any Final Award that have a Fair Market Value, as determined by
      the
      Committee, equal to the amount required to be withheld.  The Fair
      Market Value of fractional shares of Stock remaining after the withholding
      requirements are satisfied will be paid to the Participant in
      cash.  The Company may also require the Participant to deliver a check
      for the Company’s withholding tax obligation prior to effecting the transfer of
      shares pursuant to a Final Award.

     

    9. Miscellaneous.

     

    (a) The
      Participant (or his legal
      representatives, the executor of his estate or his heirs) shall not be deemed
      to
      be a shareholder of the Company with respect to any of the Performance Stock
      Rights until shares of Stock have been issued pursuant to a Final Award and
      the
      Company’s withholding tax liability has been satisfied, to the Committee’s
      satisfaction.

     

    (b) The
      Performance Stock Rights shall not
      be transferable by the Participant; provided that following the Participant’s
      death, any Final Award made with respect to the Participant will be paid to
      the
      Participant’s estate or to such person as the executor of the estate certifies
      as being entitled to such payment as a result of the operation of the
      Participant’s last will and testament or as a result of the laws of intestate
      succession.

     

    (c) It
      is fully understood that nothing
      contained in this Agreement or the Plan shall interfere with or limit in any
      way
      the right of the Company or any Affiliate to terminate the Participant’s
      employment at any time nor confer upon the Participant any right to continue
      in
      the employ of the Company or any Affiliate.

     

    (d) As
      a condition of the granting of
      Performance Stock Rights under this Agreement, the Participant agrees, for
      himself and his legal representatives, the executor of his estate, and his
      heirs, that the Plan and this Agreement shall be subject to discretionary
      interpretation by the Committee and that any interpretation by the Committee
      of
      the terms of the Plan and this Agreement shall be final, binding and conclusive
      on the Participant, his legal representatives, the executor of his estate and
      his heirs.  The Participant, his legal representatives, the executor
      of his estate and his heirs shall not challenge or dispute the Committee’s
      decisions.

     

    (e) The
      Committee may modifythe Performance
      Stock Rights at any time.  However, no modification, extension or
      renewal shall (i) confer on the Participant any right or benefit which he would
      not be entitled to if new Performance Stock Rights were granted under the Plan
      at such time or (ii) alter, impair or adversely affect the Performance Stock
      Rights or this Agreement without the written consent of the Participant;
      provided that the Committee need not obtain written consent of the Participant
      for a modification of the Performance Stock Right to the extent that the Plan
      specifically permits the Committee action or to the extent that the Committee
      deems such modification necessary to comply with any applicable law, the listing
      requirements of any principal securities exchange or market on which the shares
      underlying the 

     

    
      
        
        

      

      
        -4-

        
          

        

      

      
        
        

      

       

    

    Performance
      Stock Right are then traded,
      or to preserve favorable accounting or tax treatment of the Performance Stock
      Right for the Company; and provided further, that unless the Committee
      determines that a Performance Stock Right is not intended to comply with the
      requirements of Section 162(m) of the Internal Revenue Code, the Committee
      shall
      not take any such action with respect to a Participant who is a Covered
      Executive (as defined in the Plan) if such action would cause any Final Award
      granted to the Participant to cease to qualify as “qualified performance-based
      compensation” for purposes of Section 162(m) of the Internal Revenue
      Code.

     

    (f) No
      shares of Stock will be issued
      pursuant to a Final Award unless and until the Company has determined to its
      satisfaction that such issuance complies with all relevant provisions of
      applicable law, including the requirements of any stock exchange on which the
      Stock may then be traded.

     

    10. Governing
      Law.  This
      Agreement shall be governed by the internal laws of the State of Illinois, without regard
      to the
      principle of conflict of laws, as to all matters,
      including, but not
      limited to, matters of validity, construction, effect, performance and
      remedies.  No legal action or proceeding may be brought with respect
      to this Agreement more than one year after the later of (a) the last date on
      which the act or omission giving rise to the legal action or proceeding
      occurred; or (b) the date on which the individual bringing such legal action
      or
      proceeding had knowledge (or reasonably should
      have had
      knowledge) of such act or omission.  Any such action or proceeding
      must be commenced and prosecuted in its entirety in the federal or state court
      having jurisdiction over Brown County, Wisconsin, or Cook County,
      Illinois, and each individual with any
      interest
      hereunder agrees to submit to the personal jurisdiction thereof, and agrees
      not
      to raise the objection that such courts are not a convenient
      forum.   Such
      action or other legal proceeding shall be heard pursuant to a bench trial,
      and the parties to such
      proceeding shall waive their rights to a trial by jury.

     

    11. Severability.  In
      the event any provision
      of the Agreement is held illegal or invalid for any reason, the illegality
      or
      invalidity will not affect the remaining provisions of the Agreement, and the
      Agreement shall be construed and enforced as if the illegal or invalid provision
      had not been included.

     

    12. Terms
      of
      Plan Govern.  All
      parties acknowledge that this option is granted under and pursuant to the Plan,
      which shall govern all rights, interests, obligations and undertakings of both
      the Company and the Participant.

     

    INTEGRYS
      ENERGY GROUP,
      INC.

    

 

                                                                    
      

    By:/s/
      Bud
      Treml                                                                      

    Title:
      Senior VP
& Chief HR Officer

    
      
        
        

        
        

      

      
        -5-

        
          

        

      

      
        
        

      

    

    ACKNOWLEDGEMENT
      FORM

    

    I
      have read the terms of the
Integrys Energy Group,
      Inc.
Performance Stock Right
      Agreement, dated May 17, 2007, and I hereby declare
      that I understand
      and agree to be bound by the terms and conditions of the
      Agreement.

     

     ________________________________________                                                                     
      

    Participant

    

    Print
      name: ___________________________          

    

    PLEASE
      DETACH THIS ACKNOWLEDGEMENT FORM
      FROM THE PERFORMANCE STOCK RIGHT AGREEMENT AND RETURN IT TO THE GREEN BAY HUMAN
      RESOURCES DEPARTMENT.  YOUR PERFORMANCE STOCK RIGHT WILL NOT BECOME
      EFFECTIVE UNTIL THE COMPANY RECEIVES THIS ACKNOWLEDGMENT
      FORM.

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