Amendment to the Amended and Restated ALLETE Executive Annual Incentive Plan (January 2007)

Summary

This amendment, effective January 1, 2007, modifies the ALLETE Executive Annual Incentive Plan. It states that any incentive award to a participant will be reduced by any amount that the company cannot deduct due to IRS Code Section 162(m) or similar tax rules. The amendment is executed by ALLETE, Inc., represented by its Chairman, President & CEO, and attested by its Senior Vice President, General Counsel & Secretary.

EX-10.H.4 4 exhibit10h4.txt JANUARY 2007 AMENDMENT TO THE EXEC ANNUAL INCENTIVE PLAN EXHIBIT 10(h)4 ALLETE 2006 Form 10-K AMENDMENT TO THE AMENDED AND RESTATED ALLETE EXECUTIVE ANNUAL INCENTIVE PLAN The ALLETE Executive Annual Incentive Plan, dated effective January 1, 1999, as amended, is amended as follows: 1. Effective January 1, 2007, the following sentence will be added at the end of Section 7.1 in Article 7: "A Participant's Award will be reduced by, and the Participant will not receive, any amount that otherwise would be disallowed as a deduction by the Company due to the limitations under Code Section 162(m), or any subsequent or similar Code provision that limits the amount of compensation expense the Company may deduct." ALLETE, INC. By: /s/ Donald J. Shippar --------------------------------------------- Donald J. Shippar Chairman, President & Chief Executive Officer ATTEST: By: /s/ Deborah A. Amberg -------------------------------------------------- Deborah A. Amberg Senior Vice President, General Counsel & Secretary