Exhibit 10.14.1
 
FIRST AMENDMENT TO THE SEVERANCE AGREEMENT
BETWEEN SEMCO ENERGY, INC. AND
LANCE S. SMOTHERMAN

THIS FIRST AMENDMENT to the Severance Agreement (the “Agreement”) dated June 29,
2005, by and between SEMCO Energy, Inc. (the “Company”), a corporation organized
and existing under the laws of the State of Michigan, and Lance S. Smotherman
(“Executive”) is made as of this 22nd day of February, 2007.

W I T N E S S E T H:

WHEREAS, the Company and the Executive entered into the Agreement as of June 29,
2005;

WHEREAS, Section 3 of the Agreement provides for Executive’s compensation;

WHEREAS, the Company’s Board of Directors has, from time to time since the
execution of the Agreement approved adjustments to the Target Annual Bonus
opportunity and Long-Term Incentive Award Target set forth in the Agreement; and

WHEREAS, the Company and Executive desire to amend the Agreement to include the
previously approved changes in the Target Annual Bonus opportunity and Long-Term
Incentive Award Target for the Executive and to allow for increases in the
short-term and long-term incentive opportunity levels from time to time without
further amendments to the Agreement and to make certain other changes in the
Agreement;

NOW, THEREFORE, the Agreement is hereby amended as follows:

1.  By adding the following to the end of Section 3.2:

The percentage set forth in Exhibit C shall be reviewed annually by the Board of
Directors, and may be increased from time to time to reflect market changes in
the compensation paid to similarly-situated executives but may not be decreased
without Executive’s express written consent.

2.  By adding the following to the end of Section 3.3.2:

The Long-Term Incentive Award Target set forth in Exhibit D shall be reviewed
annually by the Board of Directors, and may be increased from time to time to
reflect market changes in the compensation paid to similarly-situated executives
but may not be decreased without Executive’s written consent.

--------------------------------------------------------------------------------

3.  Exhibit A to the Agreement is amended as follows:

Effective February 22, 2007, Executive’s title shall be: Senior Vice President
of Human Resources and Administration.

Executive shall report to the Company’s President and Chief Executive Officer.

Executive’s functions, authority, duties, and responsibilities shall include
(without limitation): Overall responsibility for, and supervision of, all Human
Resources, Information Technology, Safety, Training, and Communications matters
involving or otherwise affecting the Company, including (without limitation)
advising the Board of Directors with respect to all such matters, determining
and implementing the Company’s Human Resources, Information Technology, Safety,
Training, and Communications strategies and activities, and controlling all
expenditures related thereto. Executive shall at all times be a member of the
Company’s senior executive group, for purpose of providing the benefit of his
business experience to the Company.

4.  Exhibit C to the Agreement is amended as follows:

Effective as of February 23, 2006, Executive’s Target Annual Bonus shall be 35%
multiplied by his Base Salary.

Effective as of January 1, 2007, Executive’s Target Annual Bonus shall be 40%
multiplied by his Base Salary.

5.  Exhibit D to the Agreement is amended as follows:

Effective as of February 23, 2006, Executive’s Long-Term Incentive Award Target
is increased from 40% multiplied by his Base Salary to 50% multiplied by his
Base Salary.

Effective as of January 1, 2007, Executive’s Long-Term Incentive Award Target is
increased from 50% multiplied by his Base Salary to 55% multiplied by his Base
Salary.

Except as expressly amended hereby, the Agreement shall remain in full force and
effect.
 
2

--------------------------------------------------------------------------------

IN WITNESS WHEREOF, the parties hereto have caused this First Amendment to be
executed as of the day and year first above written.
 

        SEMCO ENERGY, INC.  
   
   
    By:   /s/ George A. Schreiber, Jr.    

--------------------------------------------------------------------------------

  Title:  President and CEO   

--------------------------------------------------------------------------------

 

        EXECUTIVE  
   
   
    /s/ Lance S. Smotherman  

--------------------------------------------------------------------------------

   

 
3
 

--------------------------------------------------------------------------------