STOCK EQUIVALENT PROGRAM

FOR NONEMPLOYEE DIRECTORS OF

XCEL ENERGY INC.

(As First Effective May 20, 2015)

ARTICLE I

PURPOSE, DEFINITIONS AND GENERAL PROVISIONS

1.1     Purpose . The purposes of this Program are: (a) to enable a portion of the compensation of each Nonemployee Director of Xcel Energy Inc. to be tied to the performance of the common stock of the Company; and (b) to permit each such Nonemployee Director to defer receipt of all or a portion of his/her retainer, board or committee meeting fees.

The Company intends the Program to be compliant with Section 409A of the Internal Revenue Code and the regulations and other guidance issued thereunder. This Program is considered a “subplan” of the Xcel Energy Inc. 2015 Omnibus Incentive Plan (the “Plan”) as such term is used in the Plan, and a successor plan to the Stock Equivalent Plan for Non-Employee Directors of Xcel Energy Inc. (the “Predecessor Plan”). The terms and conditions of the Program shall be considered part of an Award Agreement under the Plan with respect to any Program Award to any Nonemployee Director. Except as otherwise provided, any capitalized term used herein shall have the same meaning as given the term by the Plan.

1.2     Definitions .

its Board. Such payments may include directors' retainers, including annual retainers and retainers for committee, chair or lead director service, board meeting fees and committee meeting fees, but shall exclude direct reimbursement of expenses.

1.3     Discretionary Awards . Subject to Section 16.3 of the Plan, the Board may make Discretionary Awards to Participants from time to time in such amount and number as the Board shall determine in its sole discretion. Each Discretionary Award shall contain such terms, restrictions and conditions as the Board may determine that are not inconsistent with this Program or the Plan. Discretionary Awards shall be denominated in Stock Equivalents or as a dollar amount (which shall be converted into Stock Equivalents as provided in Section 2.2), as determined in the sole discretion of the Board.

1.4     Deferral Awards . In accordance with this Section, a Nonemployee Director may elect to receive Deferral Awards in lieu of all or a portion of his/her Compensation by filing with the Secretary of the Company an election in writing on a form approved by the Company. Deferral Awards shall be made in a dollar amount equal to the amount of Compensation the Nonemployee Director has elected to defer and shall be converted into Stock Equivalents and credited to a Participant's Stock Account as provided in Section 2.2. A deferral election with respect to Compensation for a calendar year must be made prior to the beginning of that calendar year. In the case of an individual who becomes a Nonemployee Director after the first

day of a calendar year, a deferral election must be made within 30 days of the date such individual becomes a Nonemployee Director, and shall be effective only as to Compensation for services performed after the date the election is made. A deferral election shall continue in effect until the Nonemployee Director's “separation from service” (as the term is defined for purposes of Section 409A of the Code) as a member of the Board (a “Termination of Service”) or, if the Nonemployee Director provides the Secretary of the Company with earlier written notice to discontinue or change the deferral election, the end of the calendar year in which such written notice is received by the Secretary. Notwithstanding the foregoing, the deferral election (including any default election) made by a Nonemployee Director under the Predecessor Plan with respect to 2015 Compensation shall be applied for purposes of this Program to all 2015 Compensation payable on or after the Effective Date. No new deferral elections may be made for 2015 Compensation for a Nonemployee Director in place as of the Effective Date.

ARTICLE II

TREATMENT OF AWARDS

2.1      Stock Accounts . The Company shall establish on its books a Stock Account in the name of each Participant to reflect the Company's liability to each Participant who has received an Award. To this Stock Account shall be credited Awards plus other items as described hereafter. A Participant's Stock Account may be divided into two or more subaccounts as the Board determines necessary or desirable for the administration of the Program. Payments to a Participant or Beneficiary following Termination of Service shall be debited to the Stock Account. In addition, debits and credits to the Stock Account shall be made in the manner provided hereafter. Despite the maintenance of such Stock Account for each Participant, the Company's obligation to make distributions under the Program shall be made from the Company's general assets and property. The Company may, in its sole discretion, establish a separate fund or account to make payment to a Participant or Beneficiary hereunder. Whether the Company, in its sole discretion, does establish such a fund or account, no Participant or Beneficiary or any person shall have, under any circumstances, any interest whatever in any particular property or assets of the Company by virtue of this Program or of the Plan.

2.2     Crediting of Awards . An Award in the form of Stock Equivalents shall be credited to a Participant's Stock Account as of the applicable Award Date. An Award in dollars shall be credited to a Participant's Stock Account as of the applicable Award Date by converting the dollar amount of the Award into a number of Stock Equivalents equal to the number of Shares, calculated to three decimal places, that could be purchased on the Award Date with the dollar amount of such Award at Fair Market Value.

2.3      Crediting of Dividend Equivalents/Capitalization Adjustments .

(a)    On each date on which a dividend in cash or property (other than a stock dividend) is distributed by the Company on issued and outstanding Shares, the Stock Account of a Participant shall be credited, subject to Section 2.1(b), with additional Stock Equivalents as follows: (i) the dollar amount of the fair market value of the cash or property so distributed per issued and outstanding Share shall be multiplied by the number of Stock Equivalents (including fractions) in the Participant's Stock Account on the record date for such distribution; (ii) this

dollar amount shall then be converted into Stock Equivalents equal to the number of Shares, calculated to three decimal places, that could be purchased on the payment date for such distribution by dividing such dollar amount by a price per share equal to the Fair Market Value on such payment date.

(b)    If an equity restructuring (within the meaning of FASB Topic 718) affecting the Shares such as stock split or stock dividend occurs, the Board shall, in accordance with Section 4.4 of the Plan, appropriately adjust the number of Stock Equivalents in each Participant’s Stock Account to prevent dilution or enlargement of Participants’ rights under the Program. The Board may make similar adjustments in connection with other changes in the Company’s corporate capitalization as provided in Section 4.4 of the Plan.

2.4      Change in Ownership . If the Company shall be a party or subject to any consolidation, merger, share exchange or other transaction which, in any case, constitutes either a “change in the ownership” of the Company or a “change in the ownership of a substantial portion of the assets” of the Company within the meaning of Section 409A of the Code (a “Change in Ownership”), then in connection with such transaction either (i) the acquiring, surviving or successor corporation (or its direct or indirect parent corporation) shall continue the Program in accordance with Section 22.21 of the Plan and the Stock Equivalents in each Participant's Stock Account on the day immediately preceding the effective date of such transaction shall be converted into an appropriate number of stock equivalents of such other entity, or (ii) the Board shall terminate the Program and the entire remaining balance in each Participant's Stock Account shall be paid in a single distribution to the Participant in Shares, cash or a combination of both within the time periods permitted by and otherwise in accordance with the requirements of Section 409A of the Code. For purposes of any cash payment made pursuant to this Section 2.4, the value of a Stock Equivalent shall be computed as the greater of (a) the Fair Market Value on or nearest the date on which the Change in Ownership is deemed to occur, or (b) the highest per Share actually paid in connection with the Change in Control.

2.5     Time of Payment of Awards .

(a)    Except as provided in Section 2.7, Awards shall not be payable to a Participant prior to the Participant's Termination of Service.

Upon a Termination of Service, except as provided in subsection (c) below, the balance of a Participant's Stock Account shall be paid in the manner selected by the Participant, which may either be in the form of a lump sum or in substantially equal annual installments payable over a period that may range between 2 and 10 years. Such lump sum payment shall be made, or such installment payments shall commence, between January 1 ^st and March 31 ^st of the year following Termination of Service, with subsequent installment payments made during the same time period each year. The number of Shares and cash in lieu of any fractional Stock Equivalent to be distributed shall be calculated as set forth in Section 2.6. A Participant may only make one distribution election, and once made, such election shall be irrevocable. Any distribution election must be made at the earlier of (i) the time the Participant makes his or her initial deferral election under section 1.4, or (ii) prior to the beginning of the calendar year for which the Participant first receives a Discretionary Award. The distribution election must be made in writing on a form approved by the Company. Notwithstanding the foregoing, the

distribution election (including any default election) made by a Nonemployee Director under the Predecessor Plan with respect to 2015 Compensation and Discretionary Awards shall be applied for purposes of this Program to all Compensation payable and Discretionary Awards received on or after the Effective Date. No new distribution elections may be made for 2015 Compensation or Discretionary Awards for a Nonemployee Director in place as of the Effective Date.

(b)      Notwithstanding any election made by a Participant, in the event of a Participant's death prior to payment in full of a Participant's Stock Account, the entire remaining balance in the Participant's Account shall be paid in a single distribution to the Participant's Beneficiary within 90 days after the Participant’s death (and in no event shall the Beneficiary directly or indirectly be permitted to designate the year of payment).

2.6      Form of Payment . Except as otherwise provided in the Program, Awards shall be payable to a Participant only as a distribution of whole Shares equal to the number of whole Stock Equivalents credited to the Participant's Stock Account to be distributed, and cash for any fractional Stock Equivalent to be distributed. In converting a fractional Stock Equivalent in a Participant's Stock Account into cash for payment purposes, such conversion shall be based on the Fair Market Value of a Share [on the distribution date].

2.7      Acceleration of Payments . In the event of a Participant's Disability, the Board shall accelerate the payment of such Participant's Stock Account balance in a lump sum to such Participant within 90 days following the Participant’s Disability.

ARTICLE III

OTHER PROVISIONS

3.1      Amendment or Termination . The Board may amend or terminate this Program at any time; provided, however, that no amendment or termination shall adversely affect any prior Awards or rights under this Program. Any termination of this Program shall comply in all respects to the requirements of Section 409A of the Code and the regulations issued thereunder to the extent applicable.

3.2      Expenses . The expenses of administering the Program shall be borne by the Company, and shall not be charged against any Participant's Awards.

3.3     No Trust . No action by the Company or the Board under this Program shall be construed as creating a trust, escrow or other secured or segregated fund or other fiduciary relationship of any kind in favor of any Participant, Beneficiary, or any other persons otherwise entitled to Awards. The status of the Participant and Beneficiary with respect to any liabilities assumed by the Company hereunder shall be solely those of unsecured creditors of the Company. Any asset acquired or held by the Company in connection with liabilities assumed by it hereunder, shall not be deemed to be held under any trust, escrow or other secured or segregated fund or other fiduciary relationship of any kind for the benefit of the Participant or Beneficiary or to be security for the performance of the obligations of the Company, but shall

be, and remain, a general, unpledged, unrestricted asset of the Company at all times subject to the claims of general creditors of the Company.

3.4     No Impact on Directorship . This Program shall not be construed to confer any right on the part of a Participant to be or remain a Director or to receive any, or any particular rate of, Compensation.

3.5     Administration . The Board shall administer this Program in accordance with Article 3 of the Plan.

3.6     Shareholder Rights . A Participant shall not be deemed for any purpose to be or have rights as a shareholder of the Company as a result of the crediting of Stock Equivalents to the Participant’s Stock Account, until and unless the Participant becomes the record holder of the underlying Shares as provided in Section 20.3 of the Plan.

3.7     Securities Laws . Distribution of Shares to a Participant upon distribution of his/her Stock Account shall be subject to compliance with applicable laws and stock exchange rules as provided in Article 22 of the Plan.

3.8     Relationship to the Plan . This Program has been adopted pursuant to the Plan, and the Program and all Awards hereunder are subject to the terms of the Plan. If there is any conflict or inconsistency between the terms of the Program and the terms of the Plan, the terms of the Plan shall control.

3.9      Effective Date . This Program shall be effective as of May 20, 2015, subject to the Plan’s approval by the shareholders of the Company, at the 2015 annual meeting of shareholders of the Company.

XCEL ENERGY INC.

2015 OMNIBUS INCENTIVE PLAN

AWARD AGREEMENT - [YEAR] Grant

This Award Agreement (“Agreement”), dated and effective [DATE], by and between Xcel Energy Inc., a Minnesota corporation (individually and collectively with its affiliates and subsidiaries, “Xcel Energy”) and [PARTICIPANT] (the “Participant”) evidences a grant of one or more Awards pursuant to the Xcel Energy Inc. 2015 Omnibus Incentive Plan (the “Plan”). Except as otherwise provided herein, capitalized terms used in this Agreement shall have the same meaning as in the Award Terms and Conditions attached hereto as Exhibit A (the “Terms and Conditions”) or the Plan.

Restricted Stock Units Granted . Xcel Energy grants you as the Participant an award of Restricted Stock Units as set forth below:

If RSU Award is subject to a performance lever:

The Restricted Stock Units granted to the Participant and shown above are subject to the vesting conditions set forth on the Vesting Conditions Annex included in the attached Terms and Conditions, which were established by the Committee for the Period of Restriction covered by this Agreement. The number of Restricted Stock Units that shall be eligible to vest, which may be up to 20% more or less than the Total Restricted Stock Units number shown above, will be based on the extent to which the Performance Lever set forth in the Vesting Conditions Annex has been satisfied during the applicable Period of Restriction and such performance has been certified in writing by the Committee. The “Vesting Date” for this Award of Restricted Stock Units shall be the date of such certification by the Committee as specified in the Vesting Conditions Annex.

If the RSU Award is not subject to a performance lever:

All of the Restricted Stock Units granted to the Participant and shown above will vest upon the expiration of the Period of Restriction, which is the “Vesting Date” for this Restricted Stock Unit Award, if the Participant’s service with Xcel Energy has been continuous during the Restricted Period.

Performance Share Units Granted . Xcel Energy grants you as the Participant an award of

Performance Share Units as set forth below:

The Performance Share Units granted to the Participant and shown above are subject to the performance and vesting conditions set forth on one or more Performance Goal Annexes included in

the attached Terms and Conditions, which were established by the Committee for the Performance Period covered by this Agreement. To the extent that multiple Performance Goal Annexes may be applicable to this Performance Share Unit Award, the Award may be expressed in such Annexes in terms of separate components. This Performance Share Unit Award shall vest only if, and to the extent that, any one or more of the performance goals set forth in such Performance Goal Annex(es) have been achieved during the applicable Performance Period and such performance is certified in writing by the Committee. The “Vesting Date” for this Performance Share Unit Award shall be the date of such certification by the Committee as specified in Section 4(a) of the Terms and Conditions.

[ Participant is eligible to defer to a later date the settlement of the Performance Share Units granted under this Agreement, subject to satisfaction of the performance conditions set forth in the Performance Goal Annexes. ]

Acceptance of Award (s) and the Award Terms and Conditions . The Award(s) hereby granted and the terms and conditions herein set forth are subject in all respects to the Terms and Conditions, which are incorporated into, and made a part of, this Agreement, and to the terms and conditions of the Plan, which are similarly incorporated into this Agreement. To accept the Award(s), this Agreement must be accepted through an electronic medium in accordance with the procedures established by the Company, or Participant must sign and return a copy of this agreement, in either case, within [NUMBER OF DAYS] after the Grant Date. By doing so, Participant acknowledges receipt of the accompanying Terms and Conditions and the Plan, and represents that Participant has read and understands the same and agrees to be bound by the Terms and Conditions and by the Plan, which is controlling. Any question of administration or interpretation arising under this Agreement, the Terms and Conditions or the Plan, shall be determined by the Committee and such determination shall be final, conclusive and binding upon all parties in interest.

[ Non-solicitation. During your employment with Xcel Energy, and for a period of two years after the end of your employment with Xcel Energy for any reason, you agree that you will not solicit or encourage any Xcel Energy employee, contractor or vendor (directly or indirectly) to terminate or fail to renew a relationship with Xcel Energy and you agree you will not provide any information to any other person or entity for use in any similar attempt to do the same. You further agree that if you violate this provision, you will be liable to Xcel Energy for injunctive relief and damages in the full value of any Award paid under this Agreement.]

IN WITNESS WHEREOF, the parties hereto have caused this Award Agreement to be executed as of the date first above written.

XCEL ENERGY INC.

By:

ACCEPTED:

______________________________________________

Participant Signature

__________________

Date

 

EXHIBIT A

XCEL ENERGY INC.

2015 OMNIBUS INCENTIVE PLAN

AWARD TERMS AND CONDITIONS

These Award Terms and Conditions (“Terms and Conditions”) apply to Award(s) of Restricted Stock Units and/or Performance Share Units (collectively, “Units”) granted under the Xcel Energy Inc. 2015 Omnibus Incentive Plan (the “Plan”), pursuant to the Award Agreement to which these Terms and Conditions are attached (the “Agreement”). Except as otherwise provided in these Terms and Conditions or the Agreement, the capitalized terms used in these Terms and Conditions shall have the same meaning as in the Plan. Any reference to an Award in these Terms and Conditions shall mean an Award described in the Agreement.

1.      Granting of Award . Xcel Energy Inc., a Minnesota corporation (individually and collectively with its affiliates and subsidiaries, “Xcel Energy” or the “Company”), grants to you as participant (“Participant”) the Award(s) set forth in the Agreement. The grant is effective as of the Grant Date set forth in the Agreement. As used in these Terms and Conditions, the term “Award” includes additional Units credited with respect to that Award upon the deemed reinvestment of Dividend Equivalents pursuant to Section 2 below. The Units subject to the Award(s) will be credited to an account in your name maintained by the Company. This account shall be unfunded and maintained for book-keeping purposes only, with the Units simply representing an unfunded and unsecured obligation of the Company.

2.      Dividend Equivalents and Shareholder Rights . When Xcel Energy Inc. declares a cash dividend on its Shares, Dividend Equivalents equal in amount to the dividends payable (at the normal common stock declared dividend rate) on a number of Shares equal to the number of Units subject to the Award(s) (at target levels, if applicable) held by you on a dividend record date occurring after the Grant Date and prior to Vesting Date shall be deemed reinvested in additional Units as of the dividend payment date and credited to the Participant’s account as additional Units. The number of additional Units so credited shall be determined based on the Fair Market Value of a Share on the dividend payment date. Any additional Units so credited will be subject to the same terms and restrictions applicable to the underlying Awards as provided in these Terms and Conditions. Notwithstanding the forgoing, an Award does not entitle you to any rights as a stockholder.

3.      Termination of Service .

4 .      Vesting of Awards .

(a)      Subject to Section 3 above, a Performance Share Unit Award shall vest only if, and to the extent, any one or more of the performance goals set forth on the Performance Goal Annexes have been achieved during the applicable Performance Period and such performance is certified in writing by the Committee. Unless otherwise indicated in the Agreement, to the extent a Performance Share Unit Award is subject to satisfaction of performance goals set forth on more than one Performance Goal Annex, each Performance Goal Annex shall be independent from any other Performance Goal Annex with respect to the portion of the Award subject to that Performance Goal Annex. If, and to the extent that, any one or more of the performance goals have not been achieved during the applicable Performance Period, your rights to the portion of the Award tied to such unachieved performance goal shall be immediately and irrevocably forfeited as of the last day of such Performance Period (unless previously forfeited pursuant to Section 3 above). The Committee shall determine, in its sole discretion, and certify in accordance with the requirements of Section 162(m) of the Code whether and to what extent the performance goals have been satisfied as soon practicable after the completion of the applicable Performance Period (the date on which the Committee certifies the satisfaction of the performance goals set forth on the attached Performance Goal Annexes shall be the “Vesting Date” for the applicable Performance Share Unit Award).

(b)      Subject to Section 3 above, a Restricted Stock Unit Award shall vest only if, and to the extent that, any one or more of the vesting conditions set forth in the Agreement or, if applicable, in a Vesting Conditions Annex have been satisfied during the applicable Period of Restriction, or other period as may be identified. If, and to the extent that, any one or more of the vesting conditions have not been satisfied during the applicable Period of Restriction, your rights to any portion of the Award tied to such unachieved vesting condition shall be immediately and irrevocably forfeited as of the applicable Vesting Date (unless previously forfeited pursuant to Section 3 above).

5.      Payment of Vested Awards .

(a)      Timing of payment . As soon as administratively feasible following the Vesting Date, but in no event later than March 15 ^th of the year following the calendar year in which the Performance Period or Period of Restriction, as applicable, expires, Xcel Energy shall cause to be paid to you in settlement of each Unit (including any credited Dividend Equivalent Units) comprising a vested Award, one Share or cash in an amount equal to the Fair Market Value as of the Vesting Date of one such Share (or a combination of cash and Shares with respect to the entire Award) as determined by the Committee, unless you have made an effective election to defer the settlement of the Award as provided in Section 5(c) below. Payments shall be made in a lump sum.

(b)      Payment upon Death . In the event of your death, amounts that otherwise would have become payable to you in accordance with Section 3(b) of these Terms and Conditions will be paid in cash, Shares or a combination thereof, to your designated beneficiary (if such beneficiary has been designated in writing in accordance with the Plan, and such writing has been delivered to the Xcel Energy Executive Compensation department), or if no beneficiary is designated, in accordance with Article 19 of the Plan.

(c)      Deferral Election . If you are determined by the Committee in its sole discretion to be eligible, you may elect to defer to a later date the settlement of Awards that would otherwise occur as provided in Section 5(a), provided that any such deferral shall comply with the requirements of Section 409A of the Code.

6.      Changes in Capitalization of Xcel Energy . If there is any equity restructuring or other change in the Company’s corporate capitalization as described in Section 4.4(a) of the Plan, the Committee shall determine the appropriate adjustment to each Award, if any, as provided in Section 4.4 of the Plan.

7.      Change in Control . Notwithstanding anything herein to the contrary, in the event of a Change in Control, Award(s) subject to the Agreement shall be dealt with as provided in Article 17 of the Plan.

8.      Forfeiture and Recoupment . Notwithstanding anything herein to the contrary, Award(s) subject to the Agreement shall be subject to forfeiture, reduction or recoupment as provided in Section 22.1 of the Plan, and to any compensation recovery policy adopted by Xcel Energy Inc. at any time.

9.      Withholding . Xcel Energy may require you to remit to it, or may withhold from an Award or from your other compensation, an amount sufficient to satisfy any applicable federal, state or local tax, employment, FICA or other mandated withholding requirements in regard to the Award(s) in the year or years the Award(s) become taxable to you. You may elect in accordance with the Plan to satisfy the withholding requirement, in whole or in part, by having Xcel Energy withhold Shares otherwise payable in settlement of an Award at the rate the Committee determines satisfies applicable withholding requirements of the Code. For this purpose, Awards will be valued using the Fair Market Value of a Share as of the applicable withholding date. If no election is made, you will be deemed to have elected Shares to be withheld.

10.      Plan Incorporated by Reference; Electronic Delivery . The Awards hereby granted and these Terms and Conditions are subject in all respects to the terms and conditions of the Plan, which is controlling, and which shall be deemed incorporated into these Terms and Conditions and the Agreement. Xcel Energy, or a third party designated by Xcel Energy, may deliver to the Participant by electronic means any documents related to his or her participation in the Plan. You acknowledge receipt of a copy of the Plan.

11.      No Right to Employment . Nothing in these Terms and Conditions or the Agreement shall limit the right of Xcel Energy to terminate your employment or other service with Xcel Energy as provided in Section 20.1 of the Plan.

12.      Restrictions on Transfer . The Award may not be sold, assigned, transferred, pledged or otherwise encumbered by you prior to the Vesting Date.

13.      Participant Acceptance . You shall signify acceptance of these Terms and Conditions and the Agreement, including, if applicable to you, that you will abide by the Xcel Energy Stock Ownership Policy, by signing in the space provided in the Agreement and returning a signed copy to Xcel Energy, or if available, by providing an electronic signature, within the time frames specified by Xcel Energy’s Executive Compensation department.

14.      Mandatory Binding Arbitration . You agree that any and all disputes related to the Award(s) including but not limited to, eligibility, vesting, distribution and payment, withholding, targets, effect of termination of employment or rights related to an amendment or termination of the Plan, will be subject to mandatory binding arbitration in Minneapolis, Minnesota before the American Arbitration Association. You agree that you will be responsible for bearing your share of the costs to arbitrate.

15.      Severability . Any provision of these Terms and Conditions and the Agreement that is prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective to the extent of such prohibition or unenforceability without invalidating the remaining provisions hereof, and any such prohibition or unenforceability in any jurisdiction shall not invalidate or render unenforceable such provision in any other jurisdiction.

16.      Securities Law Matters . The Company shall not be required to deliver any shares of Common Stock until the requirements of any federal or state securities or other laws, rules or

regulations (including the rules of any securities exchange), as may be determined by the Company to be applicable, are satisfied.     

17.      Headings . Headings are given to sections and subsections of these Terms and Conditions and the Agreement solely as a convenience to facilitate reference. Such headings shall not be deemed in any way material or relevant to the construction or interpretation of these Terms and Conditions and the Agreement or any provision thereof.

18.      Definitions . The term “Committee” shall also include those persons to whom authority has been delegated under the Plan.