UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

FORM 8-K

CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

Date of report (Date of earliest event reported):

December 4, 2014
 


Commission
Registrant; State of Incorporation
IRS Employer
File Number
Address; and Telephone Number
Identification No.
 
 
 
 
 
 
001-09057
       WISCONSIN ENERGY CORPORATION
39-1391525
 
                   (A Wisconsin Corporation)
 
 
                   231 West Michigan Street
 
 
                   P.O. Box 1331
 
 
                   Milwaukee, WI 53201
 
 
                   (414) 221-2345
 
 
 
 
001-01245
       WISCONSIN ELECTRIC POWER COMPANY
39-0476280
 
                   (A Wisconsin Corporation)
 
 
                   231 West Michigan Street
 
 
                   P.O. Box 2046
 
 
                   Milwaukee, WI 53201
 
 
                   (414) 221-2345
 
 
 
 

The name and address of each registrant have not changed since the last report.

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

[ ] Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

[ ] Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

[ ] Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

[ ] Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))






WISCONSIN ENERGY CORPORATION
WISCONSIN ELECTRIC POWER COMPANY
 


ITEM 5.02 DEPARTURE OF DIRECTORS OR CERTAIN OFFICERS; ELECTION OF DIRECTORS; APPOINTMENT OF CERTAIN OFFICERS; COMPENSATORY ARRANGEMENTS OF CERTAIN OFFICERS.

Performance Measures

On December 4, 2014, pursuant to the terms of the Short-Term Performance Plan of Wisconsin Energy Corporation amended and restated effective as of January 1, 2010 (the "STPP"), the Compensation Committee of Wisconsin Energy Corporation's Board of Directors (the "Compensation Committee") established overall performance goals for the upcoming 2015 plan year. In general, the 2015 annual incentive under the STPP will be dependent upon financial achievement determined by Wisconsin Energy's performance against targets for earnings from continuing operations (75% weight) and cash flow (25% weight), which will be established in the near future. In addition to Wisconsin Energy's targets for earnings from continuing operations and cash flow, officers and employees whose positions principally relate to utility operations are also measured against targets for the aggregate net income of Wisconsin Electric Power Company and Wisconsin Gas LLC, subsidiaries of Wisconsin Energy. Awards can be increased or decreased by up to 10% based upon performance in the operational areas of customer satisfaction (5%), safety (2.5%) and supplier and workforce diversity (2.5%).

The Compensation Committee also determined that, for 2015, the short-term dividend equivalents awarded under the STPP will vest at the end of 2015 if Wisconsin Energy achieves the performance target for earnings from continuing operations, which will be established in the near future.

Amendment of the Performance Unit Plan

On December 4, 2014, the Compensation Committee amended and restated the Wisconsin Energy Corporation Performance Unit Plan effective January 1, 2015, to incorporate a double trigger for the vesting of performance units awarded under the plan upon a change in control. The plan now requires a separation from service after a change in control for vesting of the awards to occur. The plan was also amended to address several administrative matters.






ITEM 9.01 FINANCIAL STATEMENTS AND EXHIBITS

(d) Exhibits

10 Material Contracts

10.1
Wisconsin Energy Corporation Performance Unit Plan, amended and restated effective as of January 1, 2015.

10.2
Wisconsin Energy Corporation Restricted Stock Award Terms and Conditions governing awards under the 1993 Omnibus Stock Incentive Plan, approved December 4, 2014.

10.3
Wisconsin Energy Corporation Terms and Conditions Governing Non-Qualified Stock Option Award for option awards under the 1993 Omnibus Stock Incentive Plan, approved December 4, 2014.









SIGNATURES
 
 
 
 
Pursuant to the requirements of the Securities Exchange Act of 1934, each of the registrants has
duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
 
 
 
 
 
 
 
WISCONSIN ENERGY CORPORATION
 
  (Registrant)
 
 
 
/s/ STEPHEN P. DICKSON
Date: December 10, 2014
Stephen P. Dickson - Vice President and Controller
 
 
 
 
 
WISCONSIN ELECTRIC POWER COMPANY
 
  (Registrant)
 
 
 
/s/ STEPHEN P. DICKSON
Date: December 10, 2014
Stephen P. Dickson - Vice President and Controller
 
 
 
 
 
 
 
 






Exhibit 10.1


Wisconsin Energy Corporation
Performance Unit Plan
(amended and restated effective as of January 1, 2015)
1.
Purpose. The purposes of the Wisconsin Energy Corporation Performance Unit Plan (the "Plan") are to enhance the long‑term stockholder value of Wisconsin Energy Corporation (the "Company") by reinforcing the incentives of key executives to achieve long‑term performance goals of the Company; to link a significant portion of executives' compensation to total shareholder return; to attract and motivate executives and to encourage their continued employment on a competitive basis. The purposes of the Plan are to be achieved by the grant of Performance Units. Capitalized terms used in the Plan shall have the meanings set forth in Section 8 of this Plan, unless the context clearly indicates otherwise. The Plan was originally effective January 1, 2005. The Plan was amended and restated effective as of October 11, 2007 and was further amended and restated effective as of January 1, 2010. The Plan is hereby amended and restated effective as of January 1, 2015.
2.
Administration. The Plan shall be administered by the Compensation Committee of the Company's Board of Directors. Subject to the provisions of the Plan, the Committee shall have full and final authority to:
(a)
designate the employees to whom Performance Units shall be granted;
(b)
determine the number of Performance Units to be granted to each employee;
(c)
impose such limitations, restrictions and conditions upon any such Performance Units as the Committee shall deem appropriate;
(d)
waive in whole or in part any limitations, restrictions or conditions imposed upon any such Performance Units as the Committee shall deem appropriate; and
(e)
interpret the provisions of the Plan.
All decisions of the Committee shall be final and binding upon all parties including the Company, its stockholders and Employees,
3.
Eligibility and Participation. Key employees of the Company and/or its subsidiaries are designated for participation in the Plan by the Committee. The Committee shall also designate the number of Performance Units to be granted to the Employee at the Target 100% rate.
4.
Performance Units .
(a)
Performance Unit Defined. A Performance Unit is a right to receive a cash payment from the Company that is based upon the value of shares of Company Stock and is contingent on the Company's Total Shareholder Return during a three‑year performance period. The Committee may establish the three‑year performance periods. The Performance Units granted under this Plan will be reflected in a book account maintained by the Company for each Employee until they have become vested or have been forfeited.



(b)
Regular Vesting Of Performance Units. Except as otherwise provided in paragraph (c) below, the vesting percentage of an Employee's Performance Units shall be based upon the Company's rank in Total Shareholder Return over the three‑year performance period, relative to selected benchmark electric utilities with similar long‑term strategies. The regular vesting schedule for the Performance Units is as set forth in the following schedule:
Percentile Rank
Vesting %
<25 th  Percentile
0%
25 th  Percentile
25%
Target (50th Percentile)
100%
75 th  Percentile
125%
90 th  Percentile or above
175%

The calculation of the Employee's vesting percentage shall be subject to the following rules:
(i)
The Committee shall select the benchmark electric utilities at the beginning of the three‑year performance period.
(ii)
The Committee shall make appropriate changes to the percentile rank calculations to reflect corporate transactions, or other events or circumstances outside the ordinary course of business, affecting the benchmark electric utilities (e.g., corporate mergers). The Committee's determination regarding such changes shall be binding upon the Company and Employees.
(iii)
In the event that the Company's percentile rank is between the benchmarks identified in the left hand column, the vesting percentage shall be determined by interpolating the appropriate vesting percentage. For example, if the Company ranks 12th best of 30 benchmark electric utilities (or 60th percentile), the vesting percentage would be 110%, and if the Company ranks 6th best of the 30 benchmark electric utilities (or 80th percentile), the vesting percentage would be 141.66%.
Except as provided in paragraph (c) below, any unvested Performance Units are immediately forfeited upon the Employee's cessation of employment with the Company or a subsidiary prior to the completion of the three‑year performance period.
(c)
Special Vesting Of Performance Units. The Performance Units shall become immediately vested at the Target 100% rate upon the occurrence of any of the following events (the "Special Vesting Events"):
(i)
the termination of the Employee's employment with the Company or a subsidiary by reason of Disability or death, or
(ii)
the occurrence of a Change in Control of the Company while the Employee is employed by the Company or a subsidiary, provided, however, that effective for Performance Units awarded on or after January 1, 2015, Performance Units shall not become immediately vested at the Target 100% rate unless, following a Change in Control as defined below, the Employee's employment with the Company, or

 
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any successor thereto, is terminated by the Company without Cause or by the Employee for Good Reason, in each case prior to completion of the three-year performance period.
Further, a prorated number of the Performance Units shall become vested upon the termination of the Employee's employment with the Company or a subsidiary by reason of Retirement prior to the end of the three‑year performance period. The number of Performance Units becoming vested shall be determined by multiplying the number of Performance Units at the Target 100% rate by a fraction, with the numerator of the fraction being the number of completed calendar months between Employee's Retirement date and the beginning of the performance period and the denominator being thirty‑six (36). Therefore, if Employee retires on September 15 of the second year in the three‑year performance period, the number of Performance Units becoming vested as a result of Employee's Retirement shall be equal to the number of Performance Units at the Target 100% rate times 20/36.
(d)
Cash Dividend Adjustment. Whenever the Company declares a cash dividend on Company Stock, an Employee who is employed on the dividend declaration date shall be entitled to receive a cash amount determined by multiplying (a) the number of Performance Units at the Target 100% rate on the dividend declaration date, times (b) the amount of the cash dividend paid by the Company on a share of Company Stock. The deemed dividend equivalent shall be paid to the Employee within a reasonable period of time after the dividends are paid to Company stockholders.
Notwithstanding the foregoing, no deemed dividend equivalents shall accrue or be paid with respect to any Performance Units awarded on or after January 1, 2010.
(e)
Settlement Of Performance Units. As soon as practicable after the Performance Units become vested pursuant to paragraph (b) or (c) above, the Company shall pay to the Employee an amount in cash determined by multiplying (i) the number of Performance Units which have become vested (after application of the vesting schedules in paragraph (b) or (c) above), by (ii) the Fair Market Value of the Company Stock. For this purpose, the Fair Market Value of the Company Stock shall be determined as of the date the Performance Units become vested. In no event shall payment be made later than March 15 of the taxable year following the taxable year in which such Performance Units vest pursuant to paragraph (b) or (c) above.
5.
Shareholder Rights; Voting. An Employee shall not, by reason of any Performance Units granted hereunder, have any rights of a shareholder of the Company and shall have no voting rights with respect to any Performance Units.
6.
Non‑transferability. No right or interest of any Participant in the Plan shall be assignable or transferable, or subject to any lien, directly, by operation of law, or otherwise, including, but not limited to, execution, levy, garnishment, attachment, pledge, and bankruptcy.
7.
Beneficiary Designation. Each Participant under the Plan may, from time to time, name any beneficiary or beneficiaries (who may be named contingently or successively) to whom any benefit under the Plan is to be paid in case of his or her death before he or she receives any or all of such benefit. Each designation will revoke all prior designations by the same Participant, shall be in a form prescribed by the Company and will be effective only when submitted to the Company

 
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during the Participant's lifetime. To the extent authorized by the Committee, the designation may be made electronically or set forth in some other media or format. In the absence of any such designation, or if the beneficiary predeceases the Participant, benefits remaining unpaid at the Participant's death shall be paid to the Participant's surviving spouse, if none, to his issue per stirpes or, if none, to his next of kin determined pursuant to the laws of the state in which the Company's principal place of business is located as if the Participant had died unmarried and intestate. In the event of a Participant's divorce, any designation of the Participant's former spouse as a beneficiary shall be void unless after the divorce the Participant completes a new designation naming such former spouse as a beneficiary.
8.
Adjustments. Notwithstanding any other provision herein, in the event of any merger, reorganization, consolidation, recapitalization, liquidation, stock dividend, split‑up, share combination, or other change in the corporate structure of the Company affecting the Company Stock, such adjustment shall be made in the number of Performance Units granted to Employees as may be determined by the Committee, in its sole discretion, to be appropriate and equitable to prevent dilution or enlargement of rights.
9.
Definitions. For Plan purposes, except where the context clearly indicates otherwise, the following terms shall have the meanings set forth below:
(a)
" Beneficial Owner " shall have the meaning set forth in Rule 13d‑3 under the Exchange Act.
(b)
" Board " shall mean the Board of Directors of the Company
(c)
" Cause " means (1) the willful and continued failure of the Employee to substantially perform his or her duties (other than a failure resulting from incapacity due to physical or mental illness), after a written demand for substantial performance is delivered to the Employee by the Board, the Committee or an elected officer of the Company which specifically identifies the manner in which the Board, the Committee or the elected officer believes that the Employee has not substantially performed the Employee's duties, or (2) the willful engaging by the Employee in illegal conduct or gross misconduct which is materially and demonstrably injurious to the Company; however, no act, or failure to act, on the Employee's part shall be considered "willful" unless done, or omitted to be done, by the Employee not in good faith and without reasonable belief that the Employee's action or omission was in the best interest of the Company.
(d)
" Change in Control " shall be deemed to have occurred if the event set forth in any one of the following subparagraphs shall have occurred:
(i)
any person is or becomes the Beneficial Owner, directly or indirectly, of securities of the Company (not including in the securities beneficially owned by such Person any securities acquired directly from the Company or its subsidiaries) representing 20% or more of the combined voting power of the Company's then outstanding securities, excluding any person who becomes such a Beneficial Owner in connection with a transaction described in clause (i) of paragraph (iii) below; or

 
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(ii)
the following individuals cease for any reason to constitute a majority of the number of directors then serving individuals who, on the date hereof, constitute the Board and any new director (other than a director whose initial assumption of office is in connection with an actual or threatened election contest, including but not limited to a consent solicitation, relating to the election of directors of the Company) whose appointment or election by the Board or nomination for election by the Company's shareholders was approved or recommended by a vote of at least two‑thirds of the directors then still in office who either were directors on the date hereof or whose appointment, election or nomination for election was previously so approved or recommended; or
(iii)
there is consummated a merger or consolidation of the Company or any direct or indirect subsidiary of the Company with any other corporation, other than (i) a merger or consolidation immediately following which the directors of the Company immediately prior to such merger or consolidation continue to constitute at least a majority of the board of directors of the Company, the surviving entity or any parent thereof or (ii) a merger or consolidation effected to implement a recapitalization of the Company (or similar transaction) in which no person is or becomes the Beneficial Owner, directly or indirectly, of securities of the Company (not including in the securities Beneficially Owned by such Person any securities acquired directly from the Company or its subsidiaries) representing 20% or more of the combined voting power of the Company's then outstanding securities; or
(iv)
the shareholders of the Company approve a plan of complete liquidation or dissolution of the Company or there is consummated an agreement (or series of related agreements) for the sale or disposition by the Company of all or substantially all of the Company's assets, disregarding any sale or disposition to a company at least a majority of the directors of which were directors of the Company immediately prior to such sale or disposition; or
(v)
the Committee determines in its sole and absolute discretion that there has been a Change in Control of the Company.
(e)
" Committee " means the Compensation Committee of the Company's Board.
(f)
" Company " means Wisconsin Energy Corporation, or any successor thereto.
(g)
" Company Stock " shall mean the common stock of the Company, and such other stock and securities as may be substituted therefor.
(h)
" Disability " means separation from the service of the Company or a subsidiary because of such illness or injury as renders the Employee unable to perform the material duties of the Employee's job.
(i)
" Employee " shall mean an employee who has been selected to participate in the Plan by the Committee.

 
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(j)
" Exchange Act " means the Securities Exchange Act of 1934, as amended from time to time, or any successor Act thereto.
(k)
" Fair Market Value " means:
(i)
for purposes of determining the amount payable pursuant to paragraph (b), the closing price for a share of Company Stock on the last day in the performance period on which the New York Stock Exchange (or such other exchange or over the counter on which Company Stock is listed) is open for active trading; and
(ii)
for purposes of determining the amount payable pursuant to paragraph (c), the closing price for a share of Company Stock on the date the Performance Units become vested pursuant to such paragraph. If the New York Stock Exchange (or such other exchange or over the counter on which Company Stock is listed) is not open for active trading on such date, then the nearest date before such date on which the New York Stock Exchange (or such other exchange or over the counter on which Company Stock is listed) is open shall be used.
(l)
" Good Reason " means the existence of one or more of the following conditions arising without the consent of the Employee:  (1) a material diminution in the Employee's base compensation; (2) a material diminution in the Employee's authority, duties or responsibilities; (3) a material diminution in the authority, duties or responsibilities of the supervisor to whom the Employee is required to report; (4) a material diminution in the budget over which the Employee retains authority; (5) a material change in the geographic location at which the Employee must perform services; or (6) any other action or inaction that constitutes a material breach by the Company of any agreement under which the Employee provides services.  Notwithstanding the foregoing, to constitute a Good Reason, the Employee must provide written notice of the existence of Good Reason to the Company within 90 days of the initial existence of the foregoing conditions.  Upon receipt of such notice, the Company shall have 30 days in which to remedy the condition.  If the Company timely and fully remedies the condition, the Employee shall not have the right to terminate employment for Good Reason based on such remedied condition.  If the Company fails to timely and fully remedy the condition, the Employee may terminate employment for Good Reason
(m)
" Person " shall have the meaning given in Section 3(a)(9) of the Exchange Act, as modified and used in Sections 13(d) and 14(d) thereof, except that such term shall not include (i) the Company or any of its subsidiaries, (ii) a trustee or other fiduciary holding securities under an employee benefit plan of the Company or any of its subsidiaries, (iii) an underwriter temporarily holding securities pursuant to an offering of such securities, or (iv) a corporation owned, directly or indirectly, by the stockholders of the Company in substantially the same proportions as their ownership of the stock of the Company.
(n)
" Plan " means the Wisconsin Energy Corporation Performance Unit Plan.
(o)
" Retirement " means separation from the service of the Company or a subsidiary at or after age 60.

 
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(p)
" Total Shareholder Return " means the calculation of total return (stock price appreciation plus reinvested dividends) for a peer electric utility based upon an initial investment of $100 and subsequent $100 investments at the end of each quarter during the three‑year performance period.
10.
Tax Withholding. The Company shall have the right to deduct from any payment made under the Plan the amount of any federal, state or local taxes of any kind required by law to be withheld with respect to the grant, vesting, payment or settlement of an award under this Plan, or to take such other action as may be necessary in the opinion of the Company to satisfy all obligations for the payment of such taxes.
11.
Governing Law. The law of the State of Wisconsin, except its law with respect to choice of law, shall be controlling in all matters relating to the Plan.
12.
Plan Amendment and Termination. The Committee may, in its sole discretion, amend, suspend or terminate the Plan at any time, with or without advance notice to Employees, provided that no amendment, modification or termination of the Plan may adversely affect in a material manner any right of any Employee with respect to any Performance Units theretofore granted without such Employee's written consent.
13.
Acceptance of Performance Units. A participant must accept Performance Units granted under this Plan, including all terms and conditions of the Plan, in a time and manner as specified by the Company. To the extent authorized by the Committee, the acceptance may be made electronically or set forth in some other media or format.
14.
Miscellaneous. If the Committee determines in its discretion that a benefit under this Plan is to be paid to a minor, a person declared incompetent or to a person incapable of handling the disposition of that person's property, the Committee may direct payment of such benefit to the guardian, legal representative or person having the care and custody of such minor, incompetent or incapable person. The Committee may require proof of minority, incompetence, incapacity or guardianship, as it may deem appropriate prior to distribution of the benefit. Any payment of a benefit shall be a payment for the account of the Participant and the Participant's Beneficiary, as the case may be, and shall be a complete discharge of any liability under the Plan for such payment amount.
15.
Code Section 409A .
(a)
General Compliance . The Plan is intended to qualify for an exclusion from, or satisfy the requirements governing the deferral of compensation under Section 409A of the Internal Revenue Code and any Treasury Regulations or other Internal Revenue Service guidance promulgated thereunder (collectively, the "409A Requirements"), as applicable. The Plan shall be interpreted and administered in a manner consistent with the 409A Requirements and all terms shall be interpreted to comply with the 409A Requirements. Notwithstanding any other Plan provision, payments provided under the Plan may only be made upon an event and in a manner that complies with the 409A Requirements or an applicable exemption.

 
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(b)
Specified Employees . Effective for Performance Units awarded on or after January 1, 2015, and notwithstanding any other provision of the Plan, if any payment or benefit provided to an Employee in connection with his or her termination of employment is determined to constitute "nonqualified deferred compensation" within the meaning of Section 409A and such Employee is determined to be a "specified employee" as defined in Section 409A(a)(2)(b)(i), then such payment or benefit shall not be paid until the first payroll date to occur following the six month anniversary of termination of employment or, if earlier, upon the Employee's death.


 
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Exhibit 10.2


WISCONSIN ENERGY CORPORATION
RESTRICTED STOCK AWARD
TERMS AND CONDITIONS
2015
1.
AWARD
Subject to the terms, conditions and restrictions provided in the Notice of Restricted Stock Award (the “Notice”), this Stock Award and the Plan, Wisconsin Energy Corporation (the “Company”) grants to the Employee a restricted stock award pursuant to the Wisconsin Energy Corporation Omnibus Stock Incentive Plan as amended and restated effective as of May 5, 2011 (the “Plan”). The Stock Award covers a number of shares of the common stock of the Company, as set forth in the Notice, effective as of the date set forth in the Notice (the “Award Date”). The shares granted under the Stock Award shall be referred to as “Restricted Stock.”
2.
RESTRICTED PERIOD; VESTING
(a)
Restricted Period. During the period beginning on the Award Date and ending on the day before the third anniversary of the Award Date (the “Restricted Period”), to the extent that all or any portion of the Stock Award is not vested, the Employee may not sell, transfer, pledge, assign, or otherwise alienate or hypothecate, voluntarily or involuntarily, shares covered by the non-vested portion of the Stock Award, except by will or the laws of descent and distribution. As the Stock Award vests in accordance with subsection 2(b), the vested portion of the Stock Award shall be free of the foregoing restrictions.
(b)
Vesting. As long as the Employee remains an employee of the Company or its subsidiaries, the Stock Award will vest over the Restricted Period in accordance with the following schedule:
Years of Service from the Award Date
% of Shares Becoming Vested (rounded to the nearest whole share)
Less than 1
0%
At least 1, but less than 2
33.33%
At least 2, but less than 3
33.33%
At least 3
33.34%
For purposes of the foregoing, “Years of Service” shall commence as of the Award Date and mean years of service completed with the Company or a subsidiary. No termination of employment shall be deemed to have occurred by reason of a transfer of the Employee between the Company and a subsidiary or between two subsidiaries.
(c)
Notwithstanding subsection 2(b), the following provisions shall govern:
(i)
Termination due to Death or Disability; Occurrence of Change in Control. If, during the Restricted Period, (A)the Employee’s employment with the

 
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Company and its subsidiaries terminates by reason of the Employee’s disability or death or (B) a Change in Control (as defined in paragraph 14 of the Plan), any unvested portion of the Stock Award shall become fully vested with respect to all shares covered by the Stock Award and all transfer restrictions shall lapse. For purposes of the foregoing, “disability” shall mean separation from the service of the Company or a subsidiary because of such illness or injury as renders the Employee unable to perform the material duties of the Employee’s job.
(ii)
Other Termination. If the Employee’s employment terminates for any reason other than those described in paragraph (i) during the Restricted Period (excluding transfers as noted under subsection 2(b)), the Employee shall forfeit all shares covered by the unvested portion of the Stock Award (determined above in subsection 2(b)) as of the date of such termination, without any further obligation of the Company to the Employee and all rights of the Employee with respect to such Restricted Stock shall terminate. Notwithstanding the foregoing, the Compensation Committee may, in its discretion, vest shares upon the Employee’s termination from employment.
3.
RIGHTS DURING RESTRICTED PERIOD
The Employee, during the Restricted Period, shall have the right to vote the Restricted Stock and receive any dividends on the Restricted Stock. Any dividends declared on the Restricted Stock shall be paid to Employee through payroll. Such dividends shall not be subject to the vesting schedule or any other restrictions as exist regarding the original shares of Restricted Stock.
4.
CUSTODY
The Restricted Stock may be credited to the Employee in book entry form and shall be held in custody by the Company or an agent for the Company until the applicable restrictions have expired. If any certificates are issued for shares of Restricted Stock during the Restricted Period, such certificates shall bear an appropriate legend as determined by the Company referring to the applicable terms, conditions and restrictions and the Employee shall deliver a signed, blank stock power to the Company relating thereto.
5.
TAX WITHHOLDING
The Company shall be entitled to withhold the amount of any tax attributable to the Stock Award by withholding a portion of shares to defray all or a portion of any applicable taxes, withholding the required amounts from other compensation payable to the Employee, or such by such other method determined by the Committee (including, but not limited to, requiring a cash payment by Employee to the Company), in its discretion.
6.
IMPACT ON OTHER BENEFITS
The value of the Restricted Stock awarded hereunder, either on the Award Date or at the time such shares become vested, shall not be includable as compensation or earnings for purposes of any other benefit plan or program offered by the Company or its subsidiaries.

 
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7.
REGISTRATION
(a)
Any shares issued pursuant to the Stock Award hereunder shall be shares that are listed for trading on a national securities exchange and registered under the Securities Act of 1933, as amended. The Company does not have an obligation to sell or issue shares that are not so registered. In the event that shares are not effectively registered, but can be issued by virtue of an exemption under the Securities Act of 1933, as amended, the Company may issue shares to the Employee if the Employee represents that such shares are being acquired as an investment and not with a view to, or for sale in connection with, the distribution of any such shares. Certificates for shares issued under the circumstances of the preceding sentence shall bear an appropriate legend reciting such representation.
(b)
In no event shall the Company be required to sell, issue or deliver shares pursuant to this Stock Award if, in the opinion of the Committee, the issuance thereof would constitute a violation by either the Employee or the Company of any provision of any law or regulation of any governmental authority or any securities exchange. As a condition of any sale or issuance of shares deliverable under the Stock Award, the Company may place legends on the shares, issue stop-transfer orders and require such agreements or undertakings from the Employee as the Company may deem necessary or advisable to assure compliance with any such law or regulation.
8.
PLAN GOVERNS
Notwithstanding anything in this Stock Award, the terms of this Stock Award shall be subject to the provisions of the Plan, a copy of which is available electronically through the website of the broker servicing the Plan or may otherwise be obtained from a member of the Executive Compensation & Benefits staff. This Award is subject to all interpretations, amendments, rules and regulations established by the Compensation Committee from time to time pursuant to the Plan. In the event of an express conflict between any term, provision or condition of this Stock Award and those of the Plan, the terms, provisions or conditions of the Plan shall control. Any term, condition or provision on which the Award is silent shall be governed and administered in accordance with the terms, conditions or provisions of the Plan.
9.
NO EMPLOYMENT RIGHTS
Nothing in this Stock Award shall confer upon the Employee the right to continue in the employ of the Company or any of its subsidiaries, or to interfere with or limit the right of the Company or of such subsidiary to terminate the Employee’s employment at any time.
10.
UNDERTAKING BY EMPLOYEE
The Employee hereby agrees to take whatever additional actions and execute whatever additional documents the Compensation Committee may, in its discretion, deem necessary or advisable in order to carry out or effect one or more of the obligations or restrictions imposed on the Employee pursuant to the express provisions of this Stock Award and the Plan.


 
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11.
BINDING EFFECT
This Award shall be binding upon, and inure to the benefit of, the successors and assigns of the Company and upon persons who acquire the right to receive shares covered by the Stock Award hereunder by will or through the laws of descent and distribution.
12.
HEADINGS
Headings of the paragraphs contained in this Stock Award are inserted for convenience and reference and shall not be used in interpreting or construing the terms and provisions of the Award.
13.
ENTIRE AWARD; MODIFICATION
This Award and the Plan constitutes the entire agreement between the parties with respect to the terms and supersede all prior or written or oral negotiations, commitments, representations and agreements with respect thereto. The terms and conditions set forth in this Stock Award may only be modified or amended in a writing, signed by both parties.
14.
SEVERABILITY
In the event any one or more of the provisions of this Stock Award shall be held invalid, illegal or unenforceable in any respect in any jurisdiction, such provision or provisions shall be automatically deemed amended, but only to the extent necessary to render such provision or provisions valid, legal and enforceable in such jurisdiction, and the validity, legality and enforceability of the remaining provisions of this Stock Award shall not in any way be affected or impaired thereby.
 
* * *
 
    




 
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Exhibit 10.3

WISCONSIN ENERGY CORPORATION
TERMS and CONDITIONS GOVERNING
NON-QUALIFIED STOCK OPTION AWARD
2015
1.
DEFINED TERMS
All capitalized terms used in this option and not otherwise defined herein are defined in the attached Appendix or in the Plan.
2.
OPTION GRANT
The Company grants to the Employee an option to purchase shares of common stock of the Company (the “Common Stock”), the amount of which is specified in the notice of the grant, at an option price also specified in the notice. This option is not intended to qualify as an “incentive stock option” within the meaning of Section 422 of the Internal Revenue Code of 1986, as amended (the “Code”).
3.
VESTING OF OPTION
Except as otherwise provided herein, this option shall be exercisable only prior to the Expiration Date (as defined in paragraph 4), and then only as set forth in the following schedule:
Years from Date of Option Grant
% of Shares Exercisable
Less than 3
0%
At least 3
100%
Notwithstanding the foregoing, this option shall become immediately exercisable upon the occurrence of any of the following events (the “Special Vesting Events”):
(i)
the termination of the Employee’s employment with the Company or a subsidiary by reason of Retirement, Disability or death, or, if such termination of employment described herein occurs prior to the six month anniversary of the date of option grant, the six month anniversary of the date of option grant; or
(ii)
the occurrence of a Change in Control of the Company while the Employee is employed by the Company or a subsidiary.
Any unvested shares are immediately forfeited upon the Employee’s cessation of employment with the Company or a subsidiary prior to the occurrence of a Special Vesting Event. However, the Committee may, in its discretion, vest options upon separation.
4.
TERM OF OPTION
All rights to exercise this option shall terminate on the Expiration Date which is the earliest of the following dates:

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(i)
three months after the Employee’s termination of employment with the Company or a subsidiary prior to the occurrence of a Special Vesting Event, or
(ii)
ten years from the date of grant .
5.
METHOD OF EXERCISE
This option may be exercised by appropriate notice in writing delivered to the Corporate Secretary of the Company, or by any other method approved by the Committee. The consideration to be paid for the shares to be issued upon exercise of the option, including the method of payment, shall be determined by the Committee. Such consideration may consist entirely of cash or check or combination thereof or broker-assisted cashless exercise or such other consideration or method of payment for the issuance of shares, in all cases to the extent permitted by applicable law.
6.
NON-TRANSFERABILITY; DEATH; DESIGNATED BENEFICIARY
This option is not transferable by the Employee otherwise than by will or the laws of descent and distribution, except for transfers to family members and family partnerships. This option is exercisable during the Employee’s lifetime only by the Employee.
If the Employee dies after termination of employment without any Special Vesting Event having occurred but during the option period and before the Expiration Date specified in paragraph 4 hereof, this option may be exercised, to the extent otherwise vested, in the manner described in paragraph 5 hereof, by the Employee’s “Designated Beneficiary” (defined below) or if none or if the Designated Beneficiary does not survive the Employee, by the Employee’s estate or the person to whom the option passes by will or the laws of descent and distribution, but only within a period of:
(a)
two years after the Employee’s death, or
(b)
ten years from the date of grant, whichever period is shorter.
To the extent that this option may be exercisable after the death of the Employee (whether before or after termination of employment), this option may be exercised by the “Designated Beneficiary” of the Employee. The “Designated Beneficiary” shall be the beneficiary or beneficiaries designated by the Employee in a writing filed with the Committee in such form and at such time as the Committee may require. In the absence of a living Designated Beneficiary, any rights or benefits that would have been exercisable by or distributable to the Employee shall be exercised by or distributed to the legal representative of Employee’s estate or the person to whom the option passes by will or by the laws of descent and distribution. If a Designated Beneficiary who has survived the Employee dies before exercise of all rights option or before complete distribution of benefits under this option, then any rights that would have been exercisable by the Designated Beneficiary shall be exercised by the legal representative of the estate of the Designated Beneficiary, and any benefits distributable to the Designated Beneficiary shall be distributed to the legal representative of the estate of the Designated Beneficiary.

 
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7.
REGISTRATION
If at any time during the option period the Company shall be advised by its counsel that shares deliverable upon exercise of the option are required to be registered under the Securities Act of 1933 (“Act”) or any state securities laws, or that delivery of the shares must be accompanied or preceded by a prospectus meeting the requirements of that Act or such state securities laws, the Company will use its best efforts to effect the registration or provide the prospectus not later than a reasonable time following each exercise of this option, but delivery of shares by the Company may be deferred until the registration is effected or the prospectus is available. The Employee shall have no interest in shares covered by this option until certificates for the shares are issued, or in lieu of certificates, shares are credited to the Employee’s account in the book-entry form.
8.
ADJUSTMENTS
If the Company shall at any time change the number of shares of its Common Stock without new consideration to the Company (such as by stock dividend, stock split or similar transaction), the total number of shares then remaining subject to purchase hereunder shall be changed in proportion to the change in issued shares and the option price per share shall be adjusted so that the total consideration payable to the Company upon the purchase of all shares not theretofore purchased shall not be changed. If during the term of this option, the Common Stock of the Company shall be changed into another kind of stock or into securities of another corporation, cash, evidence of indebtedness, other property or any combination thereof (the “Acquisition Consideration”), whether as a result of reorganization, sale, merger, consolidation, or other similar transaction, the Committee shall cause adequate provision to be made whereby the Employee shall thereafter be entitled to receive upon the due exercise of this option the Acquisition Consideration the Employee would have been entitled to receive for Common Stock acquired through exercise of this option immediately prior to the effective date of such transaction.
9.
WITHHOLDING
The Company shall be entitled to satisfy any tax withholding obligations arising with respect to the exercise of this option in whole or in part by withholding a portion of shares to defray all or a portion of any applicable taxes, withholding the required amounts from other compensation payable to the Employee, or by such other method determined by the Committee (including, but not limited to, requiring a cash payment by Employee to the Company), in its discretion.
10.
IMPACT ON OTHER BENEFITS
The income attributable to the exercise of this option shall not be includable as compensation or earnings for purposes of any other benefit plan or program offered by the Company or its subsidiaries.
11.
PLAN GOVERNS
Notwithstanding anything in this option, the terms of this option shall be subject to the terms of the Plan, a copy of which may be obtained electronically through the website of the broker servicing

 
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the Plan or may otherwise be obtained a member of the Executive Compensation & Benefits staff, and this option is subject to all interpretations, amendments, rules and regulations established by the Committee from time to time pursuant to the Plan.

 
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APPENDIX
This is an appendix to the Wisconsin Energy Corporation Terms and Conditions Governing an award of Non-Qualified Stock Options.
As used in the Terms & Conditions, the terminology set forth below shall have the following meanings:
(a)
“Cause” means:
(i)
the willful and continued failure of the Employee to substantially perform the Employee’s duties (other than a failure resulting from incapacity due to physical or mental illness), after a written demand for substantial performance is delivered to the Employee by the Board of Directors of the Company, the Compensation Committee or an elected officer of the Company which specifically identifies the manner in which the Board, the Committee or the elected officer believes that the Employee has not substantially performed the Employee’s duties, or
(ii)
the willful engaging by the Employee in illegal conduct or gross misconduct which is materially and demonstrably injurious to the Company. However no act, or failure to act, on the Employee’s part shall be considered “willful” unless done, or omitted to be done, by the Employee not in good faith and without reasonable belief that the Employee’s action or omission was in the best interest of the Company.
(b)
“Disability” means separation from the service of the Company or a subsidiary because of such illness or injury as renders the Employee unable to perform the material duties of the Employee’s job.
(c)
“Retirement” means separation from the Service of the Company or a subsidiary either at or after attainment of age 55 and completion of at least ten years of service or at or after age 60.



 
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