exhibit_10h7.htm


    Exhibit
10(h)7


      
        ALLETE 2008 Form 10-K


        


      


      
         

      

      ALLETE
Executive Annual Incentive Plan

      Form
of Award

      Effective
2009

      [Eligible
Executive Employees]

      


      


      


        Target Award
Opportunity

        


        


        
          
            
              	
                      Base
      Salary

                    	
                      $

                    
	 
      	 
      
	
                      Times

                    	 
      
	 
      	 
      
	
                      Award
      Opportunity (percent of base salary)

                    	
                      %             

                    
	 
      	 
      
	
                      Equals

                    	 
      
	 
      	 
      
	
                      Target
      Award

                    	
                      $

                    


            

          

        



      


      Performance Levels and Award
Amounts

      


      
        
          	 
      	
                  If
      Threshold Net Income

                  Achieved

                	 
      	
                  If
      Threshold Net Income

                  Not
      Achieved

                
	 
      	
                   

                  Below
      Threshold

                	
                   

                  Threshold

                	
                   

                  Target

                	
                   

                  Superior

                	 
      	
                   

                  Below
      Threshold

                	
                   

                  Threshold

                	
                   

                  Target

                	
                   

                  Superior

                
	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      
	
                  Net
      Income

                	
                  0%

                	
                  25%

                	
                  50%

                	
                  100%

                	 
      	
                  0%

                	
                  0%

                	
                  0%

                	
                  0%

                
	
                  Cash
      Flow

                	
                  0%

                	
                  12.5%

                	
                  25%

                	
                  50%

                	 
      	
                  0%

                	
                  12.5%

                	
                  25%

                	
                  50%

                
	
                  Strategic
      Goals

                	
                  0%

                	
                  0%

                	
                  25%

                	
                  50%

                	 
      	
                  0%

                	
                  0%

                	
                  0%

                	
                  0%

                
	
                  Payout
      as Percent of Target Award Opportunity

                	
                  0%

                	
                  37.5%

                	
                  100%

                	
                  200%

                	 
      	
                  0%

                	
                  12.5%

                	
                  25%

                	
                  50%

                


        

      

      


      Goals

      


      
        
          
            
              	 
      	 
      	 
      	 
      	 
      	 
      	
                      Goal

                    
	 
      	 
      	 
      	 
      	 
      	 
      	
                      Weighting

                    
	
                      Financial
      Goals

                    	 
      	 
      	 
      	 
      	 
      
	 
      	
                      Net
      Income

                    	
                      50%

                    
	 
      	
                      Cash
      from Operating Activities

                    	 
      	
                      25%

                    
	
                      Strategic
      Goals

                    	 
      	 
      	 
      	
                        25% 

                    
	 
      	 
      	 
      	 
      	 
      	 
      	
                      100%