Exhibit
10.7











LACLEDE
GAS COMPANY


SUPPLEMENTAL RETIREMENT BENEFIT PLAN
II





EFFECTIVE
as of January 1, 2005




































































TABLE
      OF CONTENTSPages1.
                General1.1
                Purpose
                11.2
                Effective
      Date
                21.3
                Exclusion
      of Deferred Compensation Under theLaclede
      Gas Company Incentive Compensation Plan
                22.
                Administration
      by Retirement Board2.1
                Board
                23.
                Eligibility3.1
                Persons
      Eligible to Receive Benefits
                33.2
                Participant
                33.3
                Beneficiary
                44.
                Supplemental
      Benefit4.1
                Amount
      of Supplemental Benefit
                44.2
                Time
      and Form of Payment ofSupplemental
      Benefit
                64.3
                Delay
      of Payment to a Specified Employee
                85.
                Amendment
      or Termination5.1
                Amendment
      to Conform with Law
                85.2
                Other
      Amendments and Termination
                85.3
                Form
      of Amendment or Termination
                95.4
                Notice
      of Amendment or Termination
                96.
                Miscellaneous6.1
                No
      Guarantee of Employment, etc.
                106.2
                Merger,
      Consolidation, etc.
                106.3
                Inalienability
                106.4
                Incompetency
                106.5
                No
      Requirement to Fund
                116.6
                Controlling
      Law
                116.7
                Severability
                116.8
                Limitations
      on Provision
                116.9
                Gender
      and Number
                116.10
                Section
      409A of the Internal Revenue Code
                116.11
                Claims
      Procedure
                126.12
                Special
      Distribution Events
                13











LACLEDE
GAS COMPANY


SUPPLEMENTAL RETIREMENT BENEFIT PLAN
II





ARTICLE
1





General





1.1           Purpose.  It
is the intention of Laclede Gas Company (the “Company”) to maintain appropriate
levels of retirement benefits for individuals who are entitled to benefits under
the Employees' Retirement Plan of Laclede Gas Company (the “Retirement
Plan”).  Accordingly, the Company established the Laclede Gas Company
Supplemental Retirement Benefit Plan (the “Supplemental Plan”).  The
Supplemental Plan is intended to provide benefits to or on behalf of an eligible
person, which includes:  (i) any officer of the Company; or (ii) any
Company employee with a salary level of 9 or higher (hereinafter known as grade
level of 15 or higher); whose employment with the Company ceases at a time when
such person or his spouse or beneficiary is entitled (or has become entitled) to
an immediate or future benefit under the Retirement Plan.  Such
benefits are to be provided in such a manner as to maintain the level of total
retirement benefits which would otherwise be payable under the Retirement Plan,
but for:  (a) the limitations on benefits imposed by the Internal
Revenue Code of 1986, as said Code may be amended from time to time (the
“Internal Revenue Code”); (b) subject to Section 1.3 below, the exclusion of
deferred compensation from normal compensation under the Retirement Plan; and
(c) the amendment of the pension computation formula, effective October 1,
1989.  The Supplemental Plan shall maintain the total retirement
benefit levels described above by means of supplemental payments made by the
Company to the individuals eligible for such payments as more fully described in
Articles 3 and 4.


As a result of the adoption of Section
409A of the Internal Revenue Code, the Company adopted this Supplemental Plan II
(“Plan II”), which applies to the benefits to which eligible


1


individuals
will be entitled, in the manner and at the time provided hereunder, other than
Grandfathered Benefits (as defined in the Supplemental Plan and as identified
below) (“Non-Grandfathered Supplemental Benefits”).  Simultaneously,
the Company adopted changes to the Supplemental Plan that governs all of the
Grandfathered Benefits.  All references herein to the “Plan II” or
“Supplemental Plan II” shall mean this Plan II, unless otherwise
specified.  All references herein to the Supplemental Benefit shall
mean an amount, calculated in accordance with this Plan II, but which does not
exceed the Non-Grandfathered Supplemental Benefits.


1.2           Effective Date.  The
Supplemental Plan is effective as of August 25, 1977 and governs Grandfathered
Benefits.  This Supplemental Plan II governs Non-Grandfathered
Benefits effective as of January 1, 2005.


1.3           Exclusion of Deferred
Compensation Under the Laclede Gas Company Incentive Compensation
Plan.  Notwithstanding anything to the contrary contained
elsewhere in this Supplemental Plan II, deferred compensation under the Laclede
Gas Company Incentive Compensation Plan (and any successor thereto) shall not be
included in determining the benefits to be paid under this Supplemental Plan
II.


ARTICLE
2


Administration by Retirement Board


2.1           Board.  The
Retirement Board (the “Board”) which is responsible for the administration of
the Retirement Plan, will administer this Supplemental Plan II.  The
Board shall have the same responsibility and authority with respect to this
Supplemental Plan II as it possesses with respect to the Retirement
Plan.  It shall also proceed with respect to this Supplemental Plan II
in a manner consistent with the manner in which it proceeds with respect to the
Retirement Plan, provided such manner complies with Section 409A of the Internal
Revenue Code.  At least once






2


each
year, the Board shall make a full report to the Board of Directors of the
Company of the operation of this Supplemental Plan II and the Board's
administration thereof.


ARTICLE
3


Eligibility


3.1           Persons Eligible to Receive Benefits.  Every
individual who qualifies for a benefit under the terms of the Retirement Plan
during the period beginning on January 1, 2005 and ending at the close of
business on December 31, 2008 either as a Participant or as a Beneficiary of
such a Participant, as those terms are defined in Sections 3.2 and 3.3 below,
whose benefit pursuant to the Retirement Plan is reduced by reason
of:  (1) the application of the limitations imposed by the Internal
Revenue Code; (2) subject to the provisions of Section 1.3 hereof excluding
deferred compensation under the Laclede Gas Company Incentive Compensation Plan,
by the exclusion of deferred compensation from normal compensation; and/or (3)
the application of the amendment of the pension computation formula effective
October 1, 1989; shall be eligible to receive an amount (the “Supplemental
Benefit”) (as calculated under this Plan II).


It is intended that this Supplemental
Plan II constitute an unfunded deferred compensation arrangement for the benefit
of a select group of management or highly compensated employees (and other
service providers) of the Company and its designated subsidiaries and affiliates
for purposes of the federal income tax laws and the Employee Retirement Income
Security Act of 1974, as amended (“ERISA”) and all documents, agreements or
instruments made or given pursuant to this Supplemental Plan II shall be
interpreted so as to effect such intent.


3.2           Participant.  Every
individual described in Section 3.1 above, which
includes:  (i) any officer of the Company; or (ii) any Company
employee having a grade level of 14 or higher;






3




who
is eligible to receive benefits under this Supplemental Plan II by reason of
active service with the Company shall be known as a “Participant.”


3.3           Beneficiary.  Every
individual described in Section 3.1 above who is eligible to receive benefits
under this Supplemental Plan II by reason of another individual's active service
with the Company shall be known as a “Beneficiary.”  The term
“Beneficiary” shall include spouses, heirs-at-law, legal representatives, and
every other person to whom benefits may be distributed, as determined under the
Retirement Plan.


ARTICLE
4


Supplemental Benefit


4.1          
Amount of 
Supplemental Benefit.  The amount of the Supplemental
Benefit under this Plan II which a Participant or Beneficiary, other than a
Participant described in Section 3.1(b) or the Beneficiary of such a
Participant, shall be entitled to receive hereunder shall be equal to the excess
of (a) over the sum of (b) and (c).


(a)  The present value
benefit the Participant or Beneficiary would have been entitled to receive under
any provision of the Retirement Plan using the applicable Grandfathered Formula,
as provided in the Retirement Plan and in accordance with Final Treasury
Regulation Section 1.409A-6(a)(3)(i), and in accordance with any option which is
then operative under the terms of Sections 4.1, 4.3 or 5.5 of such Plan, if such
benefit were computed:  (i) without giving effect to the limitations
imposed by the Internal Revenue Code, or its successor, and the regulations and
rulings thereunder or the terms of the Retirement Plan implementing those
limitations; (ii) by including, except for deferred compensation under the
Laclede Gas Company Incentive Compensation Plan, all other then deferred
compensation amounts in normal compensation; and (iii) by utilizing, for
purposes of computing the “Accrued Benefit” for the Participant under the
Retirement Plan as of the






4




date
of retirement, the greater of the “Accrued Benefit” determined in accordance
with:  (A) the Grandfathered Formula; or (B) the pension computation
formula in effect as of September 30, 1989.


(b)  The present value
benefit (computed using the pension computation formula then in effect at the
date of retirement) which such Participant or Beneficiary is entitled to receive
under any provision of the Retirement Plan using the applicable Grandfathered
Formula, as provided in the Retirement Plan, and in accordance with any option
which is then operative under the terms of Sections 4.1, 4.3 or 5.5 of such
Plan, including those terms implementing the limitations of the Internal Revenue
Code referred to above and excluding all then deferred compensation (other than
salary amounts deferred under the Laclede Gas Company Salary Deferral Savings
Plan, as the same may be hereafter amended, supplemented or replaced) from
normal compensation.


(c)  the Grandfathered
Benefit under the Supplemental Plan.


In the event that a Beneficiary is the
initial recipient of a retirement benefit under the Retirement Plan, the amount
of Supplemental Benefit under this Plan II to which such Beneficiary will be
entitled shall be determined in accordance with (a), (b) and (c) above, as of
the date of death of the individual whose active service with the Company
produced the benefit, with appropriate adjustment in accordance with the
applicable provisions of the Retirement Plan.


It is the intent of this Section 4.1
that the Supplemental Benefit as described above shall be determined at all
times in a manner which construes all references in this Section 4.1 to
limitations of, or imposed by, the Internal Revenue Code, to refer to the then
current limitations of the Internal Revenue Code, or its successor, and any
regulations and rulings thereunder.


4.1.2        All
determinations of the Company with respect to this 4.1 shall be final and
binding on all parties.






5




4.2           Time and Form of Payment of
Supplemental Benefit.  Except as otherwise (i) elected, (ii)
provided in Section 4.3, or (iii) permitted to be “linked” by IRS Notice 2007-86
and applicable published guidance under Section 409A of the Internal Revenue
Code, the Supplemental Benefit under this Plan II which a Participant or
Beneficiary is eligible to receive under this Plan II shall not be deemed to be
a series of separate payments for any purposes of Section 409A of the Internal
Revenue Code and shall be paid upon the Participant’s Separation from Service
from the Company (as defined below), as follow:


4.2.1       the
Supplemental Benefit under this Plan II, as the case may be, will be payable
upon the Participant’s death as a lump sum.


4.2.2       the
Supplemental Benefit under this Plan II, as the case may be, will be payable on
account of the Participant’s retirement on or after attainment of age 55, as a
lump sum on the effective date of such Separation from Service (or such other
date as provided below).


4.2.3       the
Supplemental Benefit under this Plan II, as the case may be, will be payable
upon any Separation from Service other than as described in 4.2.1 or 4.2.2 above
prior to attaining age 55 (including on account of the Participant’s disability)
as a lump sum at the time the Participant attains age 65.


For this Plan II, “Separation from
Service” shall mean a separation from service as set forth in Final Treasury
Regulation 1.409A-1(h), including the default presumptions
thereof.   For purposes of determining whether a “Separation from
Service” has occurred, employment with a Company “Affiliate” (as defined below)
shall not be deemed to be a “Separation from
Service.”   “Affiliate” shall mean shall mean any
member of the Company’s control group within the meaning of Final Treasury
Regulation Section 1.409A-1(h)(3), as such may be modified or amended from time
to time, by applying the “at least 50 percent” provisions thereof.






6




The Company may permit a Participant to
elect to change the time and/or form of payment, subject to the following
conditions: (i) the election may not take effect until at least 12 months after
the date on which the election is made; (ii) except with respect to payments
made on account of a Participant’s death, payment of the Supplemental Benefit
under this Plan II which a Participant is eligible to receive must not commence
earlier than five (5) years from the date of the Participant’s originally
scheduled payment date; and (iii) the election must be made at least 12 months
prior to the originally scheduled payment date.


Notwithstanding any other provision
contained herein, to the extent permitted by the Company and Section 409A of the
Internal Revenue Code (including Q&A-19(c) of IRS Notice 2005-1, 2005-2 IRB
274 (12/20/2004), Final Treasury Regulations promulgated under Section 409A of
the Internal Revenue Code, IRS Notice 2006-79 and IRS Notice 2007-86), the
Company may permit Participants, on or prior to December 31, 2008, to choose a
new payment date(s) for the payment of all or a portion of Supplemental Benefit
hereunder and/or make a new election with respect to the form of payment of such
benefit(s) and such elections shall not be treated as a change in the form and
timing of payment or an acceleration of payment in violation of Section 409A of
the Internal Revenue Code; provided, however, that (a) the
Participant may not make an election hereunder during the 2008 calendar year
that would cause payments to be made outside the 2008 calendar year that, but
for the election, the Participant would otherwise receive during the 2008
calendar year and (b) the Participant may not make an election hereunder during
the 2008 calendar year that would cause payments to be made during the 2008
calendar year that, but for the election, the Participant would otherwise not
receive during the 2008 calendar year.


Notwithstanding the foregoing, any
election under this Section 4.2 shall only be permitted to the extent it
complies with Internal Revenue Code Section 409A, the Final Treasury






7




Regulations
and other published guidance thereunder.


4.3           Delay of Payment to a
Specified Employee.  Notwithstanding Section 4.2
above,  if the Company determines that a Participant is a “specified
employee” as defined in Section 409A(a)(2)(B)(i) of the Internal Revenue Code
and regulations and other guidance issued thereunder, then such benefit (or
portion thereof) shall be paid no earlier than the first day of the seventh
month following the month of the Participant’s separation from service (with the
first such payment being a lump sum equal to the aggregate benefit the
Participant would have received during such period if no such payment delay had
been imposed, together with interest on such delayed amount during the period of
such restriction at a rate, per annum, equal to the Composite Average Yield on
Corporate Bonds published by Moody’s Investor Services for the month of October
in the calendar year of the Participant’s termination of
employment).  This Section 4.3 shall not apply to any benefit payable
on account of a Participant’s death.


ARTICLE
5


Amendment or Termination


5.1           Amendment to Conform with Law.  The
Company, acting through its Board of Directors, or by authority delegated by
such Board of Directors, may by amendment make such changes in, additions to,
and substitutions for the provisions of this Supplemental Plan II, to take
effect retroactively or otherwise, as is deemed necessary or advisable for the
purpose of conforming this Supplemental Plan II to any present or future federal
law relating to plans of this or similar nature, and to the administrative
regulations and rulings promulgated thereunder.


5.2           Other Amendments and Termination.  The
Company, acting through its Board of Directors, or by authority delegated by
such Board of Directors, may amend this Supplemental Plan II at any time and
from time to time in any manner which is consistent with amendments






8




made
in the Retirement Plan.   The Company, acting through its Board
of Directors, may terminate this Supplemental Plan II but only at such times and
to the extent that the Retirement Plan is terminated.  Notwithstanding
the provisions of this Section 5.2, however, so long as full benefits are being
paid under the Retirement Plan, the Company shall not amend or terminate this
Supplemental Plan II without providing each individual described in Section
4.3(a) hereof who is then receiving, or then entitled to commence receiving in
the future, benefit payments under the terms of this Plan II with a form of
benefit which is equivalent to but not greater than the value of the benefits he
would otherwise be entitled to receive in the absence of such amendment or
termination of this Plan II.  In the event the Retirement Plan is
terminated or curtailed with the result that payments to Participants and
contingent payments to Beneficiaries are discontinued or reduced, the benefits
then being paid pursuant to this Plan II shall similarly be discontinued or
reduced in the same ratio as payments under the Retirement Plan are
reduced.  Notwithstanding the above, this Plan II may not be
terminated and payments accelerated thereunder contrary to the provisions of
Section 409A of the Internal Revenue Code including, without limitation, Final
Treasury Regulation Section 1.409A-3(j)(4)(ix) with reference to Final Treasury
Regulation Section 1.409A-1(g).


5.3           Form of Amendment or Termination.  Any
such amendment, or termination or discontinuance or reduction of payments shall
be made by an instrument in writing, duly certified, reflecting that said
amendment or termination or discontinuance or reduction of payments has been
authorized by the Board of Directors.


5.4           Notice of Amendment or Termination.  The
Board shall notify Participants or Beneficiaries who are affected by any such
amendment or termination or discontinuance or reduction of payments within a
reasonable time thereof.






9









ARTICLE
6


Miscellaneous


6.1           No Guarantee of Employment, etc.  Neither
the creation of this Supplemental Plan II nor anything herein shall be construed
as giving any Participant hereunder or other employees of the Company any right
to remain in the employ of the Company, any subsidiary or any
Affiliate.


6.2           Merger, Consolidation, etc.  The
Company will not merge or consolidate with any other corporation nor liquidate
or dissolve without making suitable arrangements for the payment of any benefits
under this Supplemental Plan II to the individuals described in Section
4.3(a).


6.3           Inalienability.  Except
so far as may be contrary to the laws of any state having jurisdiction in the
premises, a Participant or Beneficiary shall have no right to assign, transfer,
hypothecate, encumber, commute or anticipate his interest in any payments under
this Supplemental Plan II and such payments shall not in any way be subject to
any legal process to levy upon or attach the same for payment of any claim
against any Participant or Beneficiary.


6.4           Incompetency.  If
any Participant or Beneficiary is, in the opinion of the Board, legally
incapable of giving a valid receipt and discharge for any payment, the Board
may, at its option, direct that such payment or any part thereof be made in
either a lump sum, or, if the Participant has elected another form of payment,
then in such form, to such person or persons who in the opinion of the Board are
caring for and supporting such Participant or Beneficiary, unless it has
received due notice of claim from a duly appointed guardian, conservator or
committee of the Participant or Beneficiary.  A payment so made will
be a complete discharge of the obligations under the Supplemental Plan II to the
extent of and as to that payment, and neither the Board nor the Company will
have any obligation regarding the application of the payment.






10







6.5           No Requirement to Fund.  No
provisions in the Supplemental Plan II shall be construed to require, either
directly or indirectly, the Company to reserve, or otherwise set aside, funds
for the payment of benefits hereunder.


6.6           Controlling Law.  To
the extent not preempted by the laws of the United States of America, the laws
of the State of Missouri shall be the controlling state law in all matters
relating to the Supplemental Plan II and shall apply.


6.7           Severability.  If
any provisions of the Supplemental Plan II shall be held illegal or invalid for
any reason, said illegality or invalidity shall not affect the remaining parts
of the Supplemental Plan, but this Supplemental Plan II shall be construed and
enforced as if said illegal and invalid provisions had never been included
herein.


6.8           Limitations on Provisions.  The
provisions of the Supplemental Plan II and any Supplemental Benefits under this
Plan II shall be limited as described herein.  Any benefit payable
under the Retirement Plan shall be paid solely in accordance with the terms and
provisions of the Retirement Plan, and nothing in this Supplemental Plan II
shall operate or be construed in any way to modify, amend, or affect the terms
and provisions of the Retirement Plan.


6.9           Gender and Number.  Masculine
gender shall include the feminine, the singular shall include the plural, and
the plural shall include the singular, unless the context clearly indicates
otherwise.


6.10         Section 409A of the Internal
Revenue Code.  Notwithstanding any other provision of the Plan
II, this Plan II is intended to comply with Section 409A of the Internal Revenue
Code and shall at all times be interpreted in accordance with such intent that
amounts that may become payable to Participant shall not be taxable to such
Participants until such amounts are paid in accordance with the terms of the
Plan II.  To the extent that any provision of the Plan II
violates






11




Section
409A of the Internal Revenue Code and the Final Treasury Regulations promulgated
thereunder such that amounts would be taxable to a Participant prior to payment
or otherwise subject to penalties under Section 409A of the Internal Revenue
Code, such provision shall be automatically reformed or stricken to preserve the
intent hereof.  Notwithstanding the foregoing, in no event will the
Company or any of its affiliates have any liability for any failure of the Plan
II to satisfy Section 409A of the Internal Revenue Code and such parties do not
guarantee that the Plan II complies with Section 409A of the Internal Revenue
Code.


6.11           Claims
Procedure.  Any claim for benefits under this Plan II shall be
submitted to the Retirement Board (as defined in the Retirement
Plan).  If the Retirement Board denies the claim for benefits, in
whole or in part, the Retirement Board shall notify the claimant of the adverse
benefit determination no later than ninety (90) days after receipt of the
claim by the Plan II, unless the Retirement Board determines that special
circumstances require an extension of time, which may not exceed a further
ninety (90) days, for processing the claim and so notifies the claimant in
writing prior to the termination of the initial 90 day period.  In the
event that a claim for benefits under this Plan II has been denied by the
Retirement Board, the decision shall be subject to further review by the
Retirement Board upon written request of the claimant made to the Retirement
Board within sixty (60) days of receipt by the claimant of notice of such
denial.  Upon request and free of charge, the Retirement Board shall
provide the claimant with reasonably access to all pertinent information,
documents and records with respect to the claim.  The decision of the
Retirement Board upon review shall be in writing and shall state the reasons for
the decision and the provisions of this Plan II on which the decision is
based.  Such decision shall be made within sixty (60) days after
the Retirement Board’s receipt of written request for such review unless a
hearing is necessitated to determine the facts and circumstances, in which






12




event
a decision shall be rendered as soon as possible, but not later than one hundred
and twenty (120) days after receipt of the claimant’s written request for
review.  The decision of the Retirement Board upon review shall be
final and binding on all persons.




6.12           Special Distribution
Events.  Notwithstanding the provisions set forth above with
respect to the payments of benefits under the Supplemental Plan II, amounts may
be paid under the Supplemental Plan II prior to the scheduled payment date set
forth above, if the Company determines that such amounts become subject to FICA
taxes under Internal Revenue Code Sections 3101, 3121(a) or 3121(v), and/or
withholding taxes under Internal Revenue Code Section 3401 or the corresponding
provisions of any state, local or foreign law as a result of the payment of such
FICA taxes; provided, that, such payment
shall not exceed the FICA amount and such other amount required to be withheld
on account of the payment of such FICA amount.  Further, a payment
will be made under the Supplemental Plan II at any time the Supplemental Plan II
fails to meet the requirements of Section 409A of the Internal Revenue Code;
provided, that, such payment
shall not exceed the amount required to be included in income as a result of the
failure to comply with Section 409A of the Internal Revenue
Code.


13