XCEL ENERGY INC

Our director compensation program aligns director and shareholder interests, and our Stock Program is designed to further that principle. Directors can elect to receive their annual equity grant in shares of common stock and/or stock equivalent units. Each stock equivalent unit has a value equal to one share of our common stock. Stock equivalent units cannot be voted by a director and are only payable as a distribution of whole shares of our common stock. The stock equivalent units fluctuate in value with the value of our common stock. Directors who elect to defer cash compensation into stock equivalent units receive a premium of 20% of the compensation that was deferred. Additional stock equivalent units are accumulated upon the payment of, and at the same value as, dividends declared on our common stock. Distributions of stock equivalent units from the Stock Program are made starting in the first quarter of the year following a director's separation from service. Directors may elect to receive distributions either in a lump sum or in annual installments over two to ten years. Distributions will be accelerated and paid in a lump sum upon a change in control, disability or death.