EXHIBIT 10(a)
AMENDMENT TO THE AMENDED AND RESTATED
ALLETE AND AFFILIATED COMPANIES
SUPPLEMENTAL EXECUTIVE RETIREMENT PLAN
The Amended and Restated ALLETE and Affiliated Companies Supplemental Executive
Retirement Plan, dated effective January 1, 2004, is amended as follows:
1. Effective October 1, 2006, Section 3.1 is DELETED in its entirety and
replaced with the following:
3.1 ELIGIBILITY
Any employee of the Company shall become a Participant as follows:
(A) For benefits under Section 4.1, an employee who was a Participant as
of September 30, 2006 shall remain a Participant and be eligible to
participate in this Plan for so long as such employee continuously
remains in ALLETE management salary grade SA-SM and continuously
participates in the ALLETE Executive Annual Incentive Plan or is
eligible to receive an Other Award. For benefits under Section 4.1,
an employee who was not a Participant as of September 30, 2006, or
who was a Participant as of September 30, 2006 and subsequently
ceased to meet the eligibility requirements stated above, shall
become eligible to participate in this Plan beginning with the first
calendar year in which such employee is in ALLETE management salary
grade SF-SM and becomes eligible to receive an Annual Incentive
Award or Other Award.
One of the following conditions must also be satisfied:
i. The Participant is in the employment of the Company on the last
day of the calendar year;
ii. The Participant died while employed by the Company during such
calendar year;
iii. The Participant Retired during such calendar year;
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iv. The Participant is disabled and is receiving benefit payments
under the Company's Long-Term Disability Benefit Plan during such
calendar year; or
v. The Participant is on an authorized leave of absence on the last
day of such calendar year and received Compensation from the
Company during such year.
(B) For benefits under Sections 4.2, 4.3 and 4.4, an employee in ALLETE
management salary grade SA-SM, or other employees as approved by the
Committee, who participates in the ALLETE Executive Annual Incentive
Plan or is eligible to receive an Other Award, shall be eligible to
participate in this Plan beginning with the first calendar year in
which such employee becomes eligible to receive Annual Incentive
Awards or Other Awards.
With respect to benefits under Section 4.3, one of the following
conditions must also be satisfied:
vi. The Participant is in the employment of the Company on the last
day of the calendar year;
vii. The Participant died while employed by the Company during such
calendar year;
viii. The Participant Retired during such calendar year;
ix. The Participant is disabled and is receiving benefit payments
under the Company's Long-Term Disability Benefit Plan during such
calendar year; or
x. The Participant is on an authorized leave of absence on the last
day of such calendar year and received Compensation from the
Company during such year.
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(C) For benefits under Section 4.5, senior executive employees are
eligible as approved by the Company's Board of Directors. Effective
January 20, 2003, no additional employees are eligible for the
benefits provided under Section 4.5.
(D) For benefits under Section 4.6, an employee who received an Annual
Incentive Award or Other Award while in ALLETE management salary
grades SA-SM shall be eligible to participate in this Plan.
Notwithstanding the foregoing, effective October 1, 2006, no
additional employees are eligible for benefits under Section 4.6.
2. Effective October 1, 2006, Section 4.1, Subsection (B) shall be DELETED
and replaced with the following:
(B) RSOP ALLOCATION MAKEUP. For a Participant who was a Participant as
of September 30, 2006, for so long as he or she remains continuously
eligible as a Participant, an amount equal to the sum of 1.5% plus
any percentage being contributed under Section 4.4(c)(10) of the
RSOP multiplied by the sum of (1) the total of the Participant's
Annual Incentive Award and Other Award for such year, plus (2) the
amount of the Participant's Compensation not included in calculating
benefits under the RSOP due to limitations under IRS Code Section
404(l). For a Participant who becomes a Participant on or after
October 1, 2006, an amount equal to the sum of 6% plus any
percentage being contributed under Section 4.4(c)(10) of the RSOP
multiplied by the sum of (1) the total of the Participant's Annual
Incentive Award and Other Award for such year, plus (2) the amount
of the Participant's Compensation not included in calculating
benefits under the RSOP due to limitations under IRS Code Section
404(l).
If a Participant transfers to an ineligible status, dies or Retires
during the year, this calculation will be based on the full Annual
Incentive Award and Other Award. If a Participant's annual Pay
exceeds that amount allowed under IRS qualified plan's compensation
limit, the amount of Participant's annual Pay will be prorated for
the number of months in an eligible status.
3. Effective October 1, 2006, Section 4.1, Subsection (C) shall be DELETED
and replaced with the following:
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(C) RSOP MATCH ALLOCATION MAKEUP. For a Participant who was a
Participant as of September 30, 2006, for so long as he or she
remains continuously eligible as a Participant, an amount equal to
100% of the amount deferred by the Participant under Section 4.2 of
this Plan plus any amount deferred under Section 5.1 of the RSOP,
provided, however, that for any calendar year, such match shall not
apply to any amount deferred by a Participant in excess of the
amount specified in Subsection 4.4(e)(3)(A) of the RSOP of the
Participant's Compensation plus Annual Incentive Award and Other
Award. For a Participant who becomes a Participant on or after
October 1, 2006, an amount equal to 100% of the amount deferred by
the Participant under Section 4.2 of this Plan plus any amount
deferred under Section 5.1 of the RSOP, provided, however, that for
any calendar year, such match shall not apply to any amount deferred
by a Participant in excess of the amount specified in Subsection
4.4(e)(3)(B) of the RSOP of the Participant's Compensation plus
Annual Incentive Award and Other Award. All amounts provided herein
shall be reduced by any amount being contributed by the Company
under Subsection 4.4(e) of the RSOP.
4. Effective January 1, 2007, Section 4.9 shall be amended to ADD the
following at the end of the first sentence of the first paragraph:
Any annuity provided under this section shall be calculated using a
7.5% interest rate, or other rate as approved by the Committee.
Notwithstanding the foregoing, annuities under this section shall be
calculated using an 8% interest rate in any circumstance in which
one of the following conditions applies: (i) the Participant left
service prior to January 1, 2007; or (ii) the Participant provided
official notice of retirement to the Company prior to January 1,
2007 with an effective retirement date on or before April 1, 2007.
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5. Effective October 1, 2006, Section 4.15 ("Supplemental Tax Benefit") is
DELETED in its entirety.
ALLETE, INC.
By: /s/ Donald J. Shippar
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Donald J. Shippar
Chairman, President & Chief Executive Officer
ATTEST:
By: /s/ Deborah A. Amberg
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Deborah A. Amberg
Senior Vice President,
General Counsel & Secretary
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