Document:

Exhibit 10.16 WPS Resources Corporation 2001 Omnibus Incentive Compensation
      Plan

    

      Exhibit
        10.16

      WPS
        RESOURCES CORPORATION

       

      2001
        OMNIBUS INCENTIVE COMPENSATION PLAN

       

      

      

      

      Section
        1. PURPOSE
        AND
        DEFINITIONS 

       

      (a) Purpose.
        The purpose of
        the WPS Resources Corporation 2001 Omnibus Incentive Compensation Plan is
        to
        promote the interests of the Company and its shareholders by (a) attracting
        and
        retaining executives and other key employees of outstanding training, experience
        and ability; (b) motivating them, by means of performance-related incentives,
        to
        achieve performance goals; and (c) enabling them to participate in the growth
        and financial success of the Company. It is intended that this purpose be
        effected via performance-based incentives and through awards or grants of
        stock
        options and various other rights with respect to shares of the Company’s common
        stock, as provided herein, to such eligible employees (as defined in subsection
        (b) below).

       

      (b) Definitions.
        The following
        terms shall have the following respective meanings unless the context requires
        otherwise: 

       

      (1) An
“Affiliate”
of,
        or a person “affiliated” with, a specified person is a person that directly, or
        indirectly through one or more intermediaries, controls, or is controlled
        by, or
        is under common control with, the person specified and the term “Associate” used
        to indicate a relationship with any person, means (i) any corporation or
        organization (other than the registrant or a majority-owned subsidiary of
        the
        registrant) of which such person is an officer or partner or is, directly
        or
        indirectly, the beneficial 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 beneficial interest or as to which such person serves as trustee
        or
        in a similar fiduciary capacity, and (iii) any relative or spouse of such
        person, or any relative of such spouse, who has the same home as such person
        or
        who is a director or officer of the registrant or any of its parents or
        subsidiaries.

       

      
        
           

        

        
           

          
            

          

        

        
           

        

      

      (2) The
        term “Annual
        Performance Right” shall mean the right to receive up to the amount of
        compensation described in the Participant’s award agreement, taking into account
        the Target Award and the Performance Formula, upon the attainment of one
        or more
        specified Performance Goals, subject to the terms and conditions of the award
        agreement and the Plan.

       

      (3) A
        person shall be
        deemed to be the “Beneficial Owner” of any securities:

       

      (A) 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, arrangement or understanding,
        or
        upon the exercise of conversion rights, exchange rights, 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; 

       

      (B) 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, 

       

       

      
        
           

        

        
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        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

      

       

      (C) 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 Section paragraph (B)
        above) or disposing of any voting securities of the Company.

       

      (4) The
        term “Board”
shall mean the Board of Directors of the Company.

       

      (5) The
        term “Change in
        Control” shall mean the occurrence of any one of the following:

       

      (A) 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;

       

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

       

      (C) 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 

       

       

      
        
           

        

        
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        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;

      

       

      (D) 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;

       

      (E) 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

       

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

       

      (6) The
        term “Code”
shall mean the Internal Revenue Code of 1986, or any successor thereto, as
        the
        same may be amended and in effect from time to time.

       

      (7) The
        term
“Committee” shall mean the committee appointed pursuant to Section 2 to
        administer the Plan.

       

      (8) The
        term “Company”
shall mean WPS Resources Corporation, or any successor thereto. 

       

      (9) The
        term
“Continuing Director” shall mean (i) any member of the Board of 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 a Continuing Director by
        a
        majority of the Continuing Directors then on such Board, and (iii) additional
        directors elected by a majority of the Continuing Directors then on such
        Board.

       

      
        
           

        

        
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      (10) The
        term “Covered
        Executive” shall mean, with respect to each taxable year of the Company, an
        individual who, on the last day of the taxable year, is the Chief Executive
        Officer of the Company or among the four highest compensated officers of
        the
        Company and its subsidiaries (other than the Chief Executive Officer), as
        determined pursuant to the executive compensation disclosure rules under
        the
        Exchange Act.

       

      (11) The
        term “Employee”
shall mean an employee of the Company or any Subsidiary. The term “Employee”
shall also be deemed to include any person who is an employee of any joint
        venture corporation or partnership, or comparable entity, in which the Company
        or Subsidiary has a substantial equity interest.

       

      (12) The
        term “Exchange
        Act” shall mean the Securities Exchange Act of 1934, or any successor thereto,
        as the same may be amended and in effect from time to time.

       

      (13) The
        term “Fair
        Market Value” shall mean the average of the highest and lowest sale prices at
        which a share of Stock shall have been sold regular way on the New York Stock
        Exchange on the date of grant of any Option or Stock Appreciation Right or
        other
        relevant valuation date. In the event that any Option or Stock Appreciation
        Right shall be granted, or other relevant valuation date shall occur, on
        a date
        on which there were no such sales of Stock on the New York Stock Exchange,
        the
        Fair Market Value of a share of Stock shall be deemed to be the average of
        the
        highest and lowest sale prices on the next preceding day on which there were
        such sales. 

       

      (14) The
        term “Final
        Award” shall mean the amount of compensation or the number of shares of Stock to
        be awarded finally to the Participant who holds an Annual Performance Right
        or a
        Performance Stock Right, as determined by the Committee taking into account
        the
        extent to which the Participant has achieved the Performance Goals.

       

      (15) The
        term “Option”
or “Options” shall mean the option to purchase Stock in accordance with Section
        6 and such other terms and conditions as may be prescribed by the Committee.
        An
        Option may be either an “incentive stock option”, as such term is defined in the
        Code, or shall otherwise be designated as an option entitled to favorable
        treatment under the 

       

      
        
           

        

        
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        Code
          (“ISO”) or a “nonqualified stock option” (“NQO”). ISOs and NQOs are individually
          called an “Option” and collectively called “Options”.

      

       

      (16) The
        term “Other
        Stock-Based Awards” shall mean awards of Stock or other rights made in
        accordance with Section 7.

       

      (17) The
        term
“Participant” shall mean an Employee who has been designated for participation
        in the Plan.

       

      (18) The
        term
“Performance Goals” shall mean, with respect to any Annual Performance Right or
        Performance Stock Right granted to a Participant who is a Covered Executive,
        a
        performance measure that is based upon one or more of the following objective
        business criteria established by the Committee with respect to the Company
        and/or any Subsidiary, division, business unit or component thereof: asset
        charge, asset turnover, return on sales, capital employed in the business,
        capital spending, cash flow, cost structure improvements, complexity reductions,
        customer loyalty, diversity, earnings growth, earnings per share, economic
        value-added, environmental health, safety, increase in customer base, market
        share, net cash balance, net income, net income margin, net operating cash
        flow,
        operating profit margin, operations and maintenance reduction, productivity,
        response time, profits before tax, quality/customer satisfaction, return
        on
        assets, return on capital, return on equity, return on net operating assets,
        return on sales, revenue growth, sales margin, sales volume, system reliability,
        total shareholder return, variable margin and working capital. With respect
        to
        any Annual Performance Right or Performance Stock Right granted to a Participant
        who is not a Covered Executive, performance goals may be based on one or
        more of
        the business criteria described above or any other criteria based on individual,
        business unit, Subsidiary, group or Company performance selected by the
        Committee. The Performance Goals may be expressed in absolute terms or relate
        to
        the performance of other companies or to an index.

       

      (19) The
        term
“Performance Formula” shall mean a formula to be applied in relation to the
        Performance Goals in determining the percentage, not to exceed 200%, of the
        Target Award earned by the Participant with respect to a Plan
        Award.

       

      
        
           

        

        
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      (20) The
        term
“Performance Period” shall mean the period of time for which performance with
        respect to one or more Performance Goals with respect to any Annual Performance
        Right or Performance Stock Right is to be measured, with such period commencing
        not earlier than 90 days prior to the date of grant of such Annual Performance
        Right or Performance Stock Right.

       

      (21) The
        terms
“Performance Stock Rights” or “Performance Shares” shall mean the right to
        receive, without payment to the Company, up to the number of shares of Stock
        described in the Participant’s award agreement, taking into account the Target
        Award and the Performance Formula, upon the attainment of one or more specified
        Performance Goals, subject to the terms and provisions of the award agreement
        and the Plan.

       

      (22) The
        term “Person”
shall mean any individual, firm, partnership, corporation or other entity,
        including any successor (by merger or otherwise) of such entity, or a group
        of
        any of the foregoing acting in concert.

       

      (23) The
        term “Plan”
shall mean the WPS Resources Corporation 2001 Omnibus Incentive Compensation
        Plan as the same may be amended and in effect from time to time.

       

      (24) The
        term “Plan
        Awards” shall mean awards or grants of incentive compensation, whether in cash
        or in the form of stock options or various other rights with respect to shares
        of Stock.

       

      (25) The
        term “Right”
shall mean an Annual Performance Right or a Performance Stock Right, as required
        by the context.

       

      (26) The
        term “Stock
        Appreciation Right” shall mean the right to receive, without payment to the
        Company, an amount of cash or Stock as determined in accordance with Section
        6,
        based on the amount by which the Fair Market Value of a share of Stock on
        the
        relevant valuation date exceeds the grant price.

       

      
        
           

        

        
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      (27) The
        term
“Subsidiary” shall mean (A) any corporation a majority of the voting stock of
        which is owned directly or indirectly by the Company or (B) any limited
        liability company a majority of the membership interest of which is owned,
        directly or indirectly, by the Company. 

       

      (28) The
        term “Stock”
shall mean shares of the Company’s common stock, par value $1.00 per
        share.

       

      (29) The
        term “Target
        Award” shall mean the amount of compensation or the number of shares of Stock,
        subject to adjustment pursuant to Section 12, to be earned by a Participant
        under an Annual Performance Right or a Performance Stock Right if all of
        the
        Performance Goals are achieved.

       

      Section
        2. ADMINISTRATION

       

      (a) Committee.
        The Plan shall be
        administered by the Compensation and Nominating Committee of the Board
        consisting of not less than two (2) members of the Board who meet the “outside”
director requirements of Section 162(m) of the Code and the “non-employee
        director” requirements of Rule 16b-3(b)(3) under the Exchange Act, or by any
        other committee appointed by the Board, provided the members of such committee
        meet such requirements. The Committee shall administer the Plan and perform
        such
        other functions as are assigned to it under the Plan. The Committee is
        authorized, subject to the provisions of the Plan, from time to time, to
        establish such rules and regulations as it may deem appropriate for the proper
        administration of the Plan, and to make such determinations under, and such
        interpretations of, and to take such steps in connection with, the Plan and
        the
        Plan Awards as it may deem necessary or advisable, in each case in its sole
        discretion. The Committee’s decisions and determinations under the Plan need not
        be uniform and may be made selectively among Participants, whether or not
        they
        are similarly situated. Any authority granted to the Committee may also be
        exercised by the Board, except to the extent that the grant or exercise of
        such
        authority would cause any qualified performance-based award to cease to qualify
        for exemption under Section 162(m) of the Code. To the extent that any permitted
        action taken by the Board conflicts with any action taken by the Committee,
        the
        Board action shall control.

       

      
        
           

        

        
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      (b) Delegation
        of
        Authority.
        The Committee may
        delegate any or all of its powers and duties under the Plan, including, but
        not
        limited to, its authority to make awards under the Plan or to grant waivers
        pursuant to Section 9, to one or more other committees (including a committee
        consisting of two or more corporate officers) as it shall appoint, pursuant
        to
        such conditions or limitations as the Committee may establish; provided,
        however,
        that the
        Committee shall not delegate its authority to (1) act on matters affecting
        any
        Participant who is subject to the reporting requirements of Section 16(a)
        of the
        Exchange Act, or the liability provisions of Section 16(b) of the Exchange
        Act
        (any such Participant being called a “Section 16 Person”) or (2) amend or modify
        the Plan pursuant to the provisions of Section 15(b). To the extent of any
        such
        delegation, the term “Committee” when used herein shall mean and include any
        such delegate.  

       

      (c) Eligibility
        of
        Committee Members.
        No person while a
        member of the Committee shall be eligible to hold or receive a Plan
        Award.

       

      Section
        3. ANNUAL
        PERFORMANCE RIGHTS AND FINAL AWARDS

       

      (a) Grant
        of Annual
        Performance Rights.
        The Committee, at
        any time and from time to time while the Plan is in effect, may grant or
        authorize the granting of, Annual Performance Rights to such officers of
        the
        Company and any Subsidiary, and other Employees, whether or not members of
        the
        Board, as it may select and in such amount as it shall designate, subject
        to the
        provisions of this Section 3.

       

      (b) Maximum
        Awards.
        The maximum
        amount that may be granted to a Covered Executive as a Final Award with respect
        to one or more Annual Performance Rights during any calendar year during
        any
        part of which the Plan is in effect, whether such Final Award is payable
        in cash
        or credited to the Covered Executive’s account under the WPS Resources
        Corporation Deferred Compensation Plan in accordance with subsection (d)
        below,
        shall be $1 million.

       

      (c) Terms
        and
        Provisions of Annual Performance Rights.
        Prior to the
        grant of any Annual Performance Right, the Committee shall determine the
        terms
        and provisions of such Right, including, without limitation (1) the Target
        Award; (2) one or more Performance Goals to 

       

      
        
           

        

        
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        be
          used
          to measure performance under such Right, and the Performance Formula to
          be
          applied against the Performance Goals in determining the amount of compensation
          earned under such Right as a percentage of the Target Award; (3) the Performance
          Period, and (4) the effect of the Participant’s termination of employment or
          death. Within 90 days of commencement of a Performance Period, the Committee
          may
          establish a minimum threshold objective for any Performance Goal for such
          Performance Period which, if not met, would result in no Final Award being
          made
          to any Participant with respect to such Performance Goal for such Performance
          Period. During and after the Performance Period, but prior to the Committee’s
          final determination of the Participant’s Final Award as provided in subsection
          (d), the Committee may adjust the Performance Goals, Performance Formula
          and
          Target Award and otherwise modify the terms and provisions of a Right granted
          to
          a Participant who is not a Covered Executive, subject to the terms and
          conditions of the Plan. Each Right shall be evidenced by an award agreement
          in
          such form as the Committee may determine. 

      

       

      (d) Final
        Awards.

       

      (1) As
        soon as
        practicable following the completion of the Performance Period relating to
        any
        Annual Performance Right, but not later than 12 months following such
        completion, the Committee shall determine the extent to which the Participant
        achieved the Performance Goals and the amount of compensation to be awarded
        as a
        Final Award to the Participant who holds such Right. In making such
        determination, the Committee shall apply the applicable Performance Formula
        for
        the Participant for the Performance Period against the accomplishment of
        the
        related Performance Goals. The Committee may, in its sole discretion, reduce
        the
        amount of any Final Award that otherwise would be awarded to any Participant
        for
        any Performance Period. In addition, the Committee may, in its sole discretion,
        increase the amount of any Final Award that otherwise would be awarded to
        any
        Participant who is not a Covered Executive. Any such determination shall
        take
        into account (A) the extent to which the Performance Goals provided in such
        Right were, in the Committee’s sole opinion, achieved, (B) the individual
        performance of such Participant during the related Performance Period and
        (C)
        such other factors as the Committee may deem relevant, including, without
        limitation, any change in circumstances or unforeseen events, relating to
        the
        Company, the 

       

      
        
           

        

        
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        economy
          or otherwise, since the date of grant of such Right. The Committee shall
          notify
          such Participant of such Participant’s Final Award as soon as practicable
          following such determination. 

      

       

      (2) Following
        the
        determination of each Final Award, unless the Participant has elected to
        defer
        all or a portion of the Final Award in accordance with the procedures set
        forth
        in the WPS Resources Corporation Deferred Compensation Plan, the Final Award
        will be payable to the Participant in cash. 

       

      Section
        4. STOCK
        AVAILABLE FOR PLAN AWARDS

       

      (a) Stock
        Subject to
        Plan.
        The Stock to be
        subject to or related to Plan Awards may be either authorized and unissued
        or
        held in the treasury of the Company. The maximum number of shares of Stock
        with
        respect to which Plan Awards may be granted under the Plan, subject to
        adjustment in accordance with the provisions of Section 12, shall be two
        million
        (2,000,000) shares of which a maximum of five hundred thousand (500,000)
        shares
        shall be granted as Performance Stock Rights, Performance Shares or Other
        Stock-Based Awards; (2) the maximum number of shares subject to Options,
        with or
        without any related Stock Appreciation Rights, or Stock Appreciation Rights
        (not
        related to Options) that may be granted pursuant to Section 6 to any Covered
        Executive during any calendar year during any part of which the Plan is in
        effect shall be 150,000 subject to adjustment in accordance with the provision
        of Section 12; and (3) the maximum number of shares of Stock that may be
        granted
        as Final Awards pursuant to Section 5 to any Covered Executive during any
        calendar year during any part of which the Plan is in effect shall be 50,000,
        subject to adjustment in accordance with the provision of Section 12.

       

      (b) Computation
        of
        Stock Available for Plan Awards.
        For the purpose
        of computing the total number of shares of Stock remaining available for
        Plan
        Awards at any time while the Plan is in effect, there shall be debited against
        the total number of shares determined to be available pursuant to subsections
        (a) and (c) of this Section 4, (1) the maximum number of shares of Stock
        subject
        to issuance upon exercise of Options or Stock Appreciation Rights granted
        under
        this Plan, (2) the maximum number of shares of Stock issuable under
        Performance

       

      
        
           

        

        
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        Stock
          Rights granted under this Plan, and (3) the number of shares of Stock related
          to
          Other Stock-Based Awards granted under this Plan, as determined by the
          Committee
          in each case as of the dates on which such Plan Awards were
          granted.

      

       

      (c) Terminated,
        Expired or Forfeited Plan Awards.
        The shares
        involved in the unexercised or undistributed portion of any terminated, expired
        or forfeited Plan Award shall be made available for further Plan Awards.
        Any
        shares of Stock made available for Plan Awards pursuant to this subsection
        (c)
        shall be in addition to the shares available pursuant to subsection (a) of
        this
        Section 4. Notwithstanding the foregoing, in the event any Option or Stock
        Appreciation Right granted to a Covered Executive is canceled, the number
        of
        shares of Stock subject to such canceled Option or Stock Appreciation Right
        shall continue to count against the individual limit specified in subsection
        (a), in accordance with the requirements of Code Section 162(m).

       

      Section
        5. PERFORMANCE
        STOCK RIGHTS AND FINAL AWARDS

       

      (a) Grant
        of
        Performance Stock Rights.
        The Committee, at
        any time and from time to time while the Plan is in effect, may grant, or
        authorize the granting of, Rights to such officers of the Company and any
        Subsidiary, and other key salaried Employees, whether or not members of the
        Board, as it may select and for such numbers of shares as it shall designate,
        subject to the provisions of this Section 5 and Section 4. 

       

      (b) Terms
        and
        Provisions of Performance Stock Rights.
        Prior to the
        grant of any Right, the Committee shall determine the terms and provisions
        of
        each Right, including, without limitation (1) the Target Award; (2) one or
        more
        Performance Goals to be used to measure performance under such Right, and
        the
        Performance Formula to be applied against the Performance Goals in determining
        the number of shares of Stock earned under such Right as a percentage of
        the
        Target Award; (3) the Performance Period; (4) the period of time, if any,
        during
        which the disposition of shares of Stock issuable under such Right shall
        be
        restricted as provided in subsection (a) of Section 10, provided,
        however,
        that the
        Committee may establish restrictions applicable to any Right at the time
        of or
        at any time prior to the granting of the related Final Award rather than
        at the
        time of granting such Right; and (5) the effect of the Participant’s

       

      
        
           

        

        
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        termination
          of
          employment or death. Within 90 days of commencement of a Performance Period,
          the
          Committee may establish a minimum threshold objective for any Performance
          Goal
          for such Performance Period which, if not met, would result in no Final
          Award
          being made to any Participant with respect to such Performance Goal for
          such
          Performance Period. During and after the Performance Period, but prior
          to the
          Committee’s final determination of the Participant’s Final Award as provided in
          subsection (d), the Committee may adjust the Performance Goals, Performance
          Formula and Target Award and otherwise modify the terms and provisions
          of a
          Right granted to a Participant who is not a Covered Executive, subject
          to the
          terms and conditions of the Plan. Each Right shall be evidenced by an award
          agreement in such form as the Committee may determine. 

      

       

      (c) Dividend
        Equivalents on Stock Performance Rights.

       

      (1) If
        the Committee
        shall determine, each Participant to whom a Right is granted shall be entitled
        to receive payment of the same amount of cash that such Participant would
        have
        received as cash dividends if, on each record date during the Performance
        Period
        relating to such Right, such Participant had been the holder of record of
        a
        number of shares of Stock equal to 100% of the related Target Award (as adjusted
        pursuant to Section 12). Any such payment may be made at the same time as
        a
        dividend is paid or may be deferred until the date that a Final Award is
        determined, as determined by the Committee in its sole discretion. Such cash
        payments are hereinafter called “dividend equivalents”.

       

      (2) Notwithstanding
        the
        provisions of subsection (c)(1), the Committee may determine that, in lieu
        of
        receiving all or any portion of any such dividend equivalent in cash, a
        Participant shall receive an award of full shares of Stock having a Fair
        Market
        Value approximately equal to the portion of such dividend equivalent that
        was
        not paid in cash. Certificates for shares of Stock so awarded may be issued
        as
        of the payment date for the related cash dividend or may be deferred until
        the
        date that the Final Award is determined, and the shares of Stock covered
        thereby
        may be subject to the terms and conditions of the Right to which it relates
        (including but not limited to the attainment of the Performance Goals) and
        the
        terms and conditions of the Plan (including but not limited to Sections 5,
        9, 10
        and 12), all as determined by the Committee in its sole discretion.

       

      
        
           

        

        
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      (d) Final
        Awards.

       

      As
        soon as
        practicable following the completion of the Performance Period relating to
        any
        Right, but not later than 12 months following such completion, the Committee
        shall determine the extent to which the Participant achieved the Performance
        Goals and the number of shares of Stock to be awarded as a Final Award to
        the
        Participant who holds such Right. Each Final Award shall represent only full
        shares of Stock, and any fractional share that would otherwise result from
        such
        Final Award calculation shall be disregarded. In making such determination,
        the
        Committee shall apply the applicable Performance Formula for the Participant
        for
        the Performance Period against the accomplishment of the related Performance
        Goals. The Committee may, in its sole discretion, reduce the amount of any
        Final
        Award that otherwise would be awarded to any Participant for any Performance
        Period. In addition, the Committee may, in its sole discretion, increase
        the
        amount of any Final Award that otherwise would be awarded to any Participant
        who
        is not a Covered Executive. Any such determination shall take into account
        (A)
        the extent to which the Performance Goals provided in such Right were, in
        the
        Committee’s sole opinion, achieved, (B) the individual performance of such
        Participant during the related Performance Period and (C) such other factors
        as
        the Committee may deem relevant, including, without limitation, any change
        in
        circumstances or unforeseen events, relating to the Company, the economy
        or
        otherwise, since the date of grant of such Right. The Committee shall notify
        such Participant of such Participant’s Final Award as soon as practicable
        following such determination. 

       

      (1) Following
        the
        determination of each Final Award, unless the Participant has elected to
        defer
        all or a portion of the Final Award in accordance with the procedures set
        forth
        in the WPS Resources Corporation Deferred Compensation Plan or unless the
        Committee has directed an alternate form of distribution, the Company shall
        issue or cause to be issued certificates for the number of shares of Stock
        representing such Final Award, registered in the name of the Participant
        who
        received such Final Award. Such Participant shall thereupon become the holder
        of
        record of the number of shares of Stock evidenced by such certificates, entitled
        to dividends, voting rights and other rights of a holder thereof, subject
        to the
        terms and provisions of the Plan, including, without limitation, the provisions
        of this subsection (d) and 

       

      
        
           

        

        
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        Sections
          9, 10 and 12. The Committee may require that such certificates bear such
          restrictive legend as the Committee may specify and be held by the Company
          in
          escrow or otherwise pursuant to any form of agreement or instrument that
          the
          Committee may specify. If the Committee has determined that deferred dividend
          equivalents shall be payable to a Participant with respect to any Right
          pursuant
          to subsection (c) of this Section 5, then concurrently with the issuance
          of such
          certificates, the Company shall deliver to such Participant a cash payment
          or
          additional shares of Stock in settlement of such dividend equivalents.
          

      

       

      Section
        6. OPTIONS
        AND
        STOCK APPRECIATION RIGHTS

       

      (a) Grant
        of
        Options.

       

      (1) The
        Committee, at
        any time and from time to time while the Plan is in effect, may authorize
        the
        granting of Options to such officers of the Company and any Subsidiary, and
        other key salaried Employees, whether or not members of the Board, as it
        may
        select, and for such numbers of shares as it shall designate, subject to
        the
        provisions of this Section 6 and Section 4. Each Option granted pursuant to
        the Plan shall be a NQO unless designated by the Committee at the time of
        grant
        as an ISO.

       

      (2) The
        date on which
        an Option shall be granted shall be the date of authorization of such grant
        or
        such later date as may be determined by the Committee at the time such grant
        is
        authorized. Any individual may hold more than one Option.

       

      (b) Price.
        In the case of
        each Option granted under the Plan the option price shall be the Fair Market
        Value of Stock on the date of grant of such Option; provided,
        however,
        that the
        Committee may in its discretion fix an option price in excess of the Fair
        Market
        Value of Stock on such date. 

       

      (c) Grant
        of Stock
        Appreciation Rights.

       

      (1) The
        Committee, at
        any time and from time to time while the Plan is in effect, may authorize
        the
        granting of Stock Appreciation Rights to such officers of the Company and
        any
        Subsidiary, and other key salaried Employees, whether or not members of
        the

       

      
        
           

        

        
          -15-

          
            

          

        

        
           

        

         

        Board,
          as it may select, and for such numbers of shares as it shall designate,
          subject
          to the provisions of this Section 6 and Section 4. Each Stock Appreciation
          Right may relate to all or a portion of a specific Option granted under
          the Plan
          and may be granted concurrently with the Option to which it relates or
          at any
          time prior to the exercise, termination or expiration of such Option (a
“Tandem
          SAR”), or may be granted independently of any Option, as determined by the
          Committee. If the Stock Appreciation Right is granted independently of
          an
          Option, the grant price of such Stock Appreciation Right shall be the Fair
          Market Value of Stock on the date of grant; provided,
          however,
          that the
          Committee may, in its discretion, fix a grant price in excess of the Fair
          Market
          Value of Stock on such grant date.

      

       

      (2) Upon
        exercise of a
        Stock Appreciation Right, the Participant shall be entitled to receive, without
        payment to the Company, either (A) that number of shares of Stock determined
        by
        dividing (i) the total number of shares of Stock subject to the Stock
        Appreciation Right being exercised by the Participant, multiplied by the
        amount
        by which the Fair Market Value of a share of Stock on the day the right is
        exercised exceeds the grant price (such amount being hereinafter referred
        to as
        the “Spread”), by (ii) the Fair Market Value of a share of Stock on the exercise
        date; or (B) cash in an amount determined by multiplying (i) the total number
        of
        shares of Stock subject to the Stock Appreciation Right being exercised by
        the
        Participant, by (ii) the amount of the Spread; or (C) a combination of shares
        of
        Stock and cash, in amounts determined as set forth in clauses (A) and (B)
        above,
        as determined by the Committee in its sole discretion; provided,
        however,
        that, in the case
        of a Tandem SAR, the total number of shares which may be received upon exercise
        of a Stock Appreciation Right for Stock shall not exceed the total number
        of
        shares subject to the related Option or portion thereof, and the total amount
        of
        cash which may be received upon exercise of a Stock Appreciation Right for
        cash
        shall not exceed the Fair Market Value on the date of exercise of the total
        number of shares subject to the related Option or portion thereof.

       

      (d) Terms
        and
        Conditions.

       

      (1) Each
        Option and
        Stock Appreciation Right granted under the Plan shall be exercisable on such
        date or dates, during such period, for such number of shares and subject
        to such
        further conditions as shall be determined pursuant to the provisions of the
        award

       

      
        
           

        

        
          -16-

          
            

          

        

        
           

        

         

        agreement
          with
          respect to such Option and Stock Appreciation Right; provided,
          however,
          that a Tandem SAR
          shall not be exercisable prior to or later than the time the related Option
          could be exercised; and provided,
          further,
          that in any event
          no Option or Stock Appreciation Right shall be exercised beyond ten years
          from
          the date of grant.

      

       

      (2) The
        Committee may
        impose such conditions as it may deem appropriate upon the exercise of an
        Option
        or a Stock Appreciation Right, including, without limitation, a condition
        that
        the Stock Appreciation Right may be exercised only in accordance with rules
        and
        regulations adopted by the Committee from time to time.

       

      (3) With
        respect to
        Options issued with Tandem SARs, the right of a Participant to exercise the
        Tandem SAR shall be cancelled if and to the extent the related Option is
        exercised, and the right of a Participant to exercise an Option shall be
        cancelled if and to the extent that shares covered by such Option are used
        to
        calculate shares or cash received upon exercise of the Tandem SAR.

       

      (4) If
        any fractional
        share of Stock would otherwise be payable to a Participant upon the exercise
        of
        an Option or Stock Appreciation Right, the Participant shall be paid a cash
        amount equal to the same fraction of the Fair Market Value of the Stock on
        the
        date of exercise.

       

      (e) Award
        Agreement.
        Each Option and
        Stock Appreciation Right shall be evidenced by an award agreement in such
        form
        and containing such provisions not inconsistent with the provisions of the
        Plan
        as the Committee from time to time shall approve. 

       

      (f) Payment
        for
        Option Shares.

       

      (1) Payment
        for shares
        of Stock purchased upon exercise of an Option granted hereunder shall be
        made in
        such manner as is provided in the applicable award agreement, which may include
        payment through a cash-less exercise executed through a broker. 

       

      (2) Unless
        the
        Committee shall provide otherwise in any award agreement, any payment for
        shares
        of Stock purchased upon exercise of an Option granted 

       

      
        
           

        

        
          -17-

          
            

          

        

        
           

        

         

        hereunder
          may be
          made in cash, by delivery of shares of Stock beneficially owned by the
          Participant, or by a combination of cash and Stock, at the election of
          the
          Participant; provided,
          however,
          that any shares
          of Stock so delivered shall have been beneficially owned by the Participant
          for
          a period of not less than six months prior to the date of exercise. Any
          such
          shares of Stock so delivered shall be valued at their Fair Market Value
          on the
          date of such exercise. The Committee shall determine whether and if so
          the
          extent to which actual delivery of share certificates to the Company shall
          be
          required.

      

       

      Section
        7. STOCK
        AND
        OTHER STOCK-BASED AWARDS

       

      (a) Grants
        of Other
        Stock-Based Awards.
        The Committee, at
        any time and from time to time while the Plan is in effect, may grant Other
        Stock-Based Awards to such officers of the Company and its Subsidiaries,
        and
        other key salaried Employees, whether or not members of the Board, as it
        may
        select. Such Plan Awards pursuant to which Stock is or may in the future
        be
        acquired, or Plan Awards valued or determined in whole or part by reference
        to,
        or otherwise based on, Stock, may include, but are not limited to, awards
        of
        restricted Stock or Plan Awards denominated in the form of “stock units”, grants
        of so-called “phantom stock” and options containing terms or provisions
        differing in whole or in part from Options granted pursuant to Section 6.
        Other
        Stock-Based Awards may be granted either alone, in addition to, in tandem
        with
        or as an alternative to any other kind of Plan Award, grant or benefit granted
        under the Plan or under any other employee plan of the Company, including
        a plan
        of any acquired entity. 

       

      (b) Terms
        and
        Conditions.
        Subject to the
        provisions of the Plan, the Committee shall have the authority to determine
        the
        time or times at which Other Stock-Based Awards shall be made, the number
        of
        shares of Stock or stock units and the like to be granted or covered pursuant
        to
        such Plan Awards (subject to the provisions of Section 4) and all other terms
        and conditions of such Plan Awards, including, but not limited to, whether
        such
        Plan Awards shall be payable or paid in cash, Stock or otherwise.

       

      
        
           

        

        
          -18-

          
            

          

        

        
           

        

      

       

      (c) Consideration
        for Other Stock-Based Awards.
        In the discretion
        of the Committee, any Other Stock-Based Award may be granted as a Stock bonus
        for no consideration other than services rendered.

       

      Section
        8. CASH
        AWARDS
        TO EMPLOYEES OF FOREIGN SUBSIDIARIES OR BRANCHES
        OR
        JOINT VENTURES

       

      In
        order to
        facilitate the granting of Plan Awards to Participants who are foreign nationals
        or who are employed outside of the United States of America, the Committee
        may
        provide for such special terms and conditions, including without limitation
        substitutes for Plan Awards, as the Committee may consider necessary or
        appropriate to accommodate differences in local law, tax policy or custom.
        Such
        substitutes for Plan Awards may include a requirement that the Participant
        receive cash, in such amount as the Committee may determine in its sole
        discretion, in lieu of any Plan Award or share of Stock that would otherwise
        have been granted to or delivered to such Participant under the Plan. The
        Committee may approve any supplements to, or amendments, restatements or
        alternative versions of the Plan as it may consider necessary or appropriate
        for
        purposes of this Section 8 without thereby affecting the terms of the Plan
        as in
        effect for any other purpose, and the Secretary or other appropriate officer
        of
        the Company may certify any such documents as having been approved and adopted
        pursuant to properly delegated authority; provided,
        however, that
        no such
        supplements, amendments, restatements or alternative versions shall include
        any
        provision that is inconsistent with the terms of the Plan as then in effect.
        Participants subject to the laws of a foreign jurisdiction may request copies
        of, or the right to view, any materials that are required to be provided
        by the
        Company pursuant to the laws of such jurisdiction. 

       

      Section
        9. PAYMENT
        OF
        PLAN AWARDS AND CONDITIONS THEREON

       

      (a) Effect
        of
        Competitive Activity.
        Anything
        contained in the Plan to the contrary notwithstanding, if the employment
        of any
        Participant shall terminate, for any reason other than death, while any Plan
        Award granted to such Participant is outstanding hereunder, and such Participant
        has not yet received the compensation or Stock covered by such Plan Award
        or
        otherwise received the full benefit of such Plan Award, such Participant,
        if
        otherwise entitled thereto, shall receive such Stock or compensation or benefit
        only if, during the entire period from 

       

      
        
           

        

        
          -19-

          
            

          

        

        
           

        

         

        the
          date
          of such Participant’s termination to the date of such receipt, such Participant
          shall have (1) made himself or herself available, upon request, at reasonable
          times and upon a reasonable basis, to consult with, supply information
          to and
          otherwise cooperate with the Company or any Subsidiary with respect to
          any
          matter that shall have been handled by him or her or under his or her
          supervision while he or she was in the employ of the Company or of any
          Subsidiary, and (2) refrained from engaging in any activity that is directly
          or
          indirectly in competition with any activity of the Company or any
          Subsidiary.

      

       

      (b) Nonfulfillment
        of Competitive Activity Conditions: Waivers Under the Plan.
        In the event of a
        Participant’s non-fulfillment of any condition set forth in subsection (a) of
        this Section 9, such Participant’s rights under any Plan Award shall be
        forfeited and cancelled forthwith; provided,
        however,
        that the
        nonfulfillment of such condition may at any time (whether before, at the
        time of
        or subsequent to termination of employment) be waived in the following
        manner:

       

      (1) with
        respect to any
        such Participant who at any time shall have been a Section 16 Person, such
        waiver may be granted by the Committee upon its determination that in its
        sole
        judgment there shall not have been and will not be any substantial adverse
        effect upon the Company or any Subsidiary by reason of the nonfulfillment
        of
        such condition; and

       

      (2) with
        respect to any
        other such Participant, such waiver may be granted by the Committee (or any
        delegate thereof) upon its determination that in its sole judgment there
        shall
        not have been and will not be any such substantial adverse effect.

       

      (c) Effect
        of
        Inimical Conduct.
        Anything
        contained in the Plan to the contrary notwithstanding, all rights of a
        Participant under any Plan Award shall cease on and as of the date on which
        it
        has been determined by the Committee that such Participant at any time (whether
        before or subsequent to termination of such Participant’s employment) acted in a
        manner inimical to the best interests of the Company or any
        Subsidiary.

       

      (d) Tax
        and Other
        Withholding.
        Prior to any
        distribution of cash, Stock or Other Stock-Based Awards (including payments
        under Section 5(c)) to any Participant, appropriate arrangements (consistent
        with the Plan and any rules adopted hereunder) shall be 

       

      
        
           

        

        
          -20-

          
            

          

        

        
           

        

         

        made
          for
          the payment of any taxes and other amounts required to be withheld by federal,
          state or local law.

      

       

      (e) Substitution.
        The Committee, in
        its sole discretion, may substitute a Plan Award (except ISOs) for another
        Plan
        Award or Plan Awards of the same or different type.

       

      Section
        10. NON-TRANSFERABILITY
        OF PLAN AWARDS; RESTRICTIONS ON DISPOSITION
        AND EXERCISE OF PLAN AWARDS

       

      (a) Restrictions
        on
        Transfer of Rights or Final Awards.
 No
        Right or, until
        the expiration of any restriction period imposed by the Committee, no shares
        of
        Stock covered by any Final Award, shall be transferred, pledged, assigned
        or
        otherwise disposed of by a Participant, except as permitted by the Plan,
        without
        the consent of the Committee, otherwise than by will or the laws of descent
        and
        distribution; provided,
        however,
        that the
        Committee may permit, on such terms as it may deem appropriate, use of Stock
        included in any Final Award as partial or full payment upon exercise of an
        Option under the Plan or a stock option under any other stock option plan
        of the
        Company prior to the expiration of any restriction period relating to such
        Final
        Award.

       

      (b) Restrictions
        on
        Transfer of Options or Stock Appreciation Rights.
        Unless the
        Committee determines otherwise, no Option or Stock Appreciation Right shall
        be
        transferable by a Participant otherwise than by will or the laws of descent
        and
        distribution, and during the lifetime of a Participant the Option or Stock
        Appreciation Right shall be exercisable only by such Participant or such
        Participant’s guardian or legal representative.

       

      (c) Restrictions
        on
        Transfer of Certain Other Stock-Based Awards.
        Unless the
        Committee determines otherwise, no Other Stock-Based Award shall be transferable
        by a Participant otherwise than by will or the laws of descent and distribution,
        and during the lifetime of a Participant any such Other Stock-Based Award
        shall
        be exercisable only by such Participant or such Participant’s guardian or legal
        representative.

       

      (d) Attachment
        and
        Levy.
        No Plan Award
        shall be subject, in whole or in part, to attachment, execution or levy of
        any
        kind, and any purported transfer in violation hereof 

       

      
        
           

        

        
          -21-

          
            

          

        

        
           

        

         

        shall
          be
          null and void. Without limiting the generality of the foregoing, no domestic
          relations order purporting to authorize a transfer of a Plan Award, or
          to grant
          to any person other than the Participant the authority to exercise or otherwise
          act with respect to a Plan Award, shall be recognized as
          valid.

      

       

      Section
        11. DESIGNATION
        OF BENEFICIARIES

       

      Any
        benefits due
        and payable to a Participant following the Participant’s death shall be paid to
        the executor or administrator of the Participant’s estate (or to such person as
        the executor or administrator of the estate may certify as being eligible
        to
        receive such award as a result of the operation of the Participant’s last will
        and testament or the application of the laws of intestate succession), and
        upon
        any such payment, the Company, the Plan, the Committee and the members thereof
        shall not be under any further liability to anyone. Notwithstanding the
        foregoing, the Committee may, but need not, permit a Participant to file
        with
        the Company a written designation of a beneficiary or beneficiaries under
        the
        Plan, subject to such limitations as to the classes and number of beneficiaries
        and contingent beneficiaries and such other limitations as the Committee
        from
        time to time may prescribe. A Participant may from time to time revoke or
        change
        any such designation of beneficiary. Any designation of a beneficiary under
        the
        Plan shall be controlling over any other disposition, testamentary or otherwise;
        provided,
        however,
        that if the
        Committee shall be in
        doubt as to the
        entitlement of any such beneficiary to receive any Right, Final Award, Option,
        Stock Appreciation Right or Other Stock-Based Award, or if applicable law
        requires the Company to do so, the Committee may recognize only the legal
        representative of such Participant as the sole beneficiary, in which case
        the
        Company, the Plan, the Committee and the members thereof shall not be under
        any
        further liability to anyone. In the event of the death of any Participant,
        the
        term “Participant” as used in the Plan shall thereafter be deemed to refer to
        the person entitled to payment pursuant to this Section 11 unless the context
        otherwise requires.

       

      
        
           

        

        
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      Section
        12. MERGER,
        CONSOLIDATION, STOCK DIVIDENDS, ETC.

       

      (a) Adjustments.
        In the event of
        any merger, consolidation, reorganization, stock split, stock dividend or
        other
        event affecting Stock, an appropriate adjustment shall be made in the total
        number of shares available for Plan Awards and in all other provisions of
        the
        Plan that include a reference to a number of shares, and in the numbers of
        shares covered by, and other terms and provisions (including, but not limited
        to
        the grant or exercise price of any Plan Award) of outstanding Plan
        Awards.

       

      (b) Committee
        Determinations.
        The foregoing
        adjustments and the manner of application of the foregoing provisions shall
        be
        determined by the Committee in its sole discretion. Any such adjustment may
        provide for the elimination of any fractional share which might otherwise
        become
        subject to a Plan Award.

       

      Section
        13. ACCELERATION
        OF PAYMENT OR MODIFICATION OF PLAN AWARDS

       

      (a) Acceleration
        and
        Modification.
        The Committee, in
        the event of the death of a Participant or in any other circumstance, may
        accelerate distribution of any Plan Award in its entirety or in a reduced
        amount, or modify any Plan Award, in each case on such basis and in such
        manner
        as the Committee may determine in its sole discretion.

       

      (b) Change
        in
        Control.
        Notwithstanding
        any other provision of the Plan, unless the Committee determines otherwise
        at
        the time of grant, upon the occurrence of a Change in Control, (1) any Plan
        Awards outstanding as of the date of such Change in Control, and that are
        not
        then vested, shall become fully vested if vesting is based solely upon length
        of
        the employment relationship, or shall become fully vested at the Target Level
        (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, (2) any restrictions or other conditions applicable to any outstanding
        Awards shall lapse, and such Plan Awards shall become free of all restrictions
        and conditions; and (3) any such Plan Awards shall be immediately paid to
        the
        Participant.

       

      
        
           

        

        
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      Section
        14. RIGHTS
        AS A
        STOCKHOLDER

       

      A
        Participant shall
        not have any rights as a stockholder with respect to any Stock covered by
        any
        Plan Award until such Participant shall have become the holder of record
        of such
        Stock.

       

      Section
        15. TERM,
        AMENDMENT, MODIFICATION AND TERMINATION OF THE PLAN
        AND
        AGREEMENTS

       

      (a) Term.
        Unless terminated
        earlier pursuant to subsection (b), the Plan shall terminate on December
        31,
        2010.

       

      (b) Amendment,
        Modification and Termination of Plan.
        The Board may,
        from time to time, amend or modify the Plan or any outstanding Plan Award,
        including without limitation, to authorize the Committee to make Plan Awards
        payable in other securities or other forms of property of a kind to be
        determined by the Committee, and such other amendments as may be necessary
        or
        desirable to implement such Plan Awards, or may terminate the Plan or any
        provision thereof; provided,
        however,
        that no such
        action of the Board, without approval of the stockholders, may (1) increase
        the
        total number of shares of Stock with respect to which Plan Awards may be
        granted
        under the Plan or the individual limits specified in Section 4(a), (2) extend
        the term of the Plan as set forth in paragraph (a) of this Section 15, (3)
        permit any person while a member of the Committee or any other committee
        of the
        Board administering the Plan to be eligible to receive or hold a Plan Award,
        or
        (4) permit the Company to decrease the grant price of any outstanding Option
        or
        Stock Appreciation Right. 

       

      (c) Limitation
        and
        Survival.
        No amendment to
        or termination of the Plan or any provision hereof, and no amendment or
        cancellation of any outstanding Plan Award, by the Board or the stockholders
        of
        the Company, shall, without the written consent of the affected Participant,
        adversely affect any outstanding Plan Award. The Committee’s authority to act
        with respect to any outstanding Plan Award, and a Participant’s ability to
        exercise an outstanding Plan award, shall survive termination of the
        Plan.

       

      (d) Amendments
        for
        Changes in Law.
        Notwithstanding
        the foregoing provisions, the Board shall have the authority to amend
        outstanding Plan Awards and the Plan to 

       

      
        
           

        

        
          -24-

          
            

          

        

        
           

        

         

        take
          into account changes in law and tax and accounting rules as well as other
          developments, and to grant Plan Awards that qualify for beneficial treatment
          under such rules, without stockholder approval.

      

       

      Section
        16. INDEMNIFICATION
        AND EXCULPATION

       

      (a) Indemnification.
        Each person who
        is or shall have been a member of the Board, the Committee, or of any other
        committee of the Board administering the Plan or of any committee appointed
        by
        the foregoing committees, shall be indemnified and held harmless by the Company
        against and from any and all loss, cost, liability or expense that may be
        imposed upon or reasonably incurred by such person in connection with or
        resulting from any claim, action, suit or proceeding to which such person
        may be
        or become a party or in which such person may be or become involved by reason
        of
        any action taken or failure to act under the Plan and against and from any
        and
        all amounts paid by such person in settlement thereof (with the Company’s
        written approval) or paid by such person in satisfaction of a judgment in
        any
        such action, suit or proceeding, except a judgment in favor of the Company
        based
        upon a finding of such person’s lack of good faith; subject,
        however,
        to the condition
        that, upon the institution of any claim, action, suit or proceeding against
        such
        person, such person shall in writing give the Company an opportunity, at
        its own
        expense, to handle and defend the same before such person undertakes to handle
        and defend it on such person’s behalf. The foregoing right of indemnification
        shall not be exclusive of any other right to which such person may be entitled
        as a matter of law or otherwise, or any power that the Company may have to
        indemnify or hold such person harmless.

       

      (b) Exculpation.
        Each member of
        the Board, the Committee, or of any other committee of the Board administering
        the Plan or any committee appointed by the foregoing committees, and each
        officer and employee of the Company, shall be fully justified in relying
        or
        acting in good faith upon any information furnished in connection with the
        administration of the Plan by any appropriate person or persons other than
        such
        person. In no event shall any person who is or shall have been a member of
        the
        Board, the Committee, or of any other committee of the Board administering
        the
        Plan or of any committee appointed by the foregoing committees, or an officer
        or
        employee of the Company, be held liable for any determination made or other
        action 

       

      
        
           

        

        
          -25-

          
            

          

        

        
           

        

         

        taken
          or
          any omission to act in reliance upon any such information, or for any action
          (including the furnishing of information) taken or any failure to act,
          if in
          good faith.

      

       

      Section
        17. EXPENSES
        OF
        PLAN

       

      The
        entire expense
        of offering and administering the Plan shall be borne by the Company and
        its
        participating Subsidiaries; provided,
        that
        the costs and
        expenses associated with the redemption or exercise of any Plan Award, including
        but not limited to commissions charged by any agent of the Company, may be
        charged to the Participants.

       

      Section
        18. FINALITY
        OF
        DETERMINATIONS

       

      Each
        determination,
        interpretation, or other action made or taken pursuant to the provisions
        of the
        Plan by the Board, the Committee or any committee of the Board administering
        the
        Plan or any committee appointed by the foregoing committees, shall be final
        and
        shall be binding and conclusive for all purposes and upon all persons,
        including, but without limitation thereto, the Company, the stockholders,
        the
        Committee and each of the members thereof, and the directors, officers, and
        employees of the Company and its Subsidiaries, the Participants, and their
        respective successors in interest.

       

      Section
        19. NO
        RIGHTS
        TO CONTINUED EMPLOYMENT OR TO PLAN AWARD

       

      (a) No
        Right to
        Employment.
        Nothing contained
        in this Plan, or in any booklet or document describing or referring to the
        Plan,
        shall be deemed to confer on any Participant the right to continue as an
        Employee or director of the Company or Subsidiary, whether for the duration
        of
        any Performance Period, the duration of any vesting period under a Plan Award,
        or otherwise, or affect the right of the Company or Subsidiary to terminate
        the
        employment of any Participant for any reason.

       

      (b) No
        Right to
        Award.
        No Employee or
        other person shall have any claim or right to be granted a Plan Award under
        the
        Plan. Having received an Award under the Plan shall not give a Participant
        or
        any other person any right to receive any other Plan Award under the Plan.
        A
        Participant shall have no rights in any Plan Award, except as set forth herein
        and in the applicable award grant.

       

      
        
           

        

        
          -26-

          
            

          

        

        
           

        

      

       

      Section
        20. GOVERNING
        LAW AND CONSTRUCTION

       

      The
        Plan and all
        actions taken hereunder shall be governed by, and the Plan shall be construed
        in
        accordance with the laws of the State of Wisconsin without regard to the
        principle of conflict of laws. Titles and headings to Sections are for purposes
        of reference only, and shall in no way limit, define or otherwise affect
        the
        meaning or interpretation of the Plan.

       

      Section
        21. SECURITIES
        AND STOCK EXCHANGE REQUIREMENTS

       

      (a) Restrictions
        on
        Resale.
        Notwithstanding
        any other provision of the Plan, no person who acquires Stock pursuant to
        the
        Plan may, during any period of time that such person is an affiliate of the
        Company (within the meaning of the rules and regulations of the Securities
        Exchange Commission) sell or otherwise transfer such Stock, unless such offer
        and sale or transfer is made (1) pursuant to an effective registration statement
        under the Securities Act of 1933 (“1933 Act”), which is current and includes the
        Stock to be sold, or (2) pursuant to an appropriate exemption from the
        registration requirements of the 1933 Act, such as that set forth in Rule
        144
        promulgated pursuant thereto.

       

      (b) Registration,
        Listing and Qualification of Shares of Common Stock.
        Notwithstanding
        any other provision of the Plan, if at any time the Committee shall determine
        that the registration, listing or qualification of the Stock covered by a
        Plan
        Award upon any securities exchange or under any foreign, federal, state or
        local
        law or practice, or the consent or approval of any governmental regulatory
        body,
        is necessary or desirable as a condition of, or in connection with, the granting
        of such Plan Award or the purchase or receipt of Stock in connection therewith,
        no Stock may be purchased, delivered or received pursuant to such Plan Award
        unless and until such registration, listing, qualification, consent or approval
        shall have been effected or obtained free of any condition not acceptable
        to the
        Committee. Any person receiving or purchasing Stock pursuant to a Plan Award
        shall make such representations and agreements and furnish such information
        as
        the Committee may request to assure compliance with the foregoing or any
        other
        applicable legal requirements. The Company shall not be required to issue
        or
        deliver any certificate or certificates for Stock under the Plan prior to
        the
        Committee’s determination that all related requirements have been fulfilled. The
        Company shall 

       

      
        
           

        

        
          -27-

          
            

          

        

        
           

        

         

        in
          no
          event be obligated to register any securities pursuant to the 1933 Act
          or
          applicable state or foreign law or to take any other action in order to
          cause
          the issuance and delivery of such certificates to comply with any such
          law,
          regulation, or requirement. 

      

       

      Section
        22. EFFECTIVE
        DATE

       

      Subject
        to Section
        23 below, the Plan shall become effective January 1, 2001. 

       

      Section
        23. VOTE
        REQUIRED

       

      The
        affirmative
        vote of the holders of a majority of the total votes cast on the proposal
        to
        approve the Plan at the 2001 annual meeting of shareholders of the Company
        will
        be required for approval of the Plan. 

       

      
        
           

        

        
          -28-Exhibit 10.1 Letter Agreement

    
      

    

                                                                                    Exhibit
      10.1

    February
      22, 2006

    

    

    George
      Foreman Enterprises, Inc.

    100
      North
      Wilkes-Barre Blvd., 4th
      Floor

    Wilkes-Barre,
      PA 18702

    Atten:
      Efrem Gerszberg

    

    Re:
      Letter
      agreement dated November 23, 2005 between Circle Group Holdings, Inc. and George
      Foreman Enterprises, Inc. (“Letter Agreement”)

    

    Ladies
      and Gentlemen:

    

    This
      letter shall confirm our agreement to extend the 90 day time period for Circle
      Group Holdings, Inc. (“CXN”) and George Foreman Enterprises, Inc. (“GFME”) to
      enter into definitive agreements as set forth in paragraph 21 of the above
      referenced Letter Agreement. CXN and GFME agree that paragraph 21 of the Letter
      Agreement is hereby modified to provide that the parties shall, on or before
      Thursday, March 16, 2006, enter into a definitive agreement incorporating the
      terms of the Letter Agreement and such other provisions customary in
      transactions of this type.

     

    If
      the
      foregoing correctly sets forth your understanding, please so indicate by signing
      a counterpart of this letter and returning it to CXN by facsimile or e-mail,
      whereupon it will constitute a binding agreement between CXN and
      GFME.

     

    Very
      truly yours,

    

    CIRCLE
      GROUP HOLDINGS, INC.

    

    

    By:
      /s/
      Gregory J. Halpern       

    Name:
      Gregory J. Halpern

    Title:
      C.E.O.

    

    

    Accepted
      and agreed to as of

    the
      date
      first above written:

     

    GEORGE
      FOREMAN ENTERPRISES, INC.

     

    By:
      /s/
      Efrem Gerszberg 

    Name:
      Efrem Gerszberg

    Title:
      President

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