|   | (1) | If      during a Performance Period the Participant (i) Retires, (ii) dies while      employed by a Related Company, or (iii) becomes Disabled, the Participant      (or the Participant’s beneficiary or estate) shall receive a payment of      any Performance Shares (as increased by the Dividend Equivalents) after      the end of the Performance Period, promptly after the Committee has      determined the extent to which Performance Goals have been      met.  The payment shall be prorated based upon the number of      whole calendar months within the Performance Period which had elapsed as      of the date of death, Retirement or Disability in relation to the number      of calendar months in the full Performance Period. A whole month is      counted in the calculation if the Participant was in the position as of      the 15th      of the month. |
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|   | (2) | If      after the end of a Performance Period, but before any or all Performance      Shares have been paid, as specified in subsection (d)(1) above, the      Participant Retires, dies or becomes Disabled, the Participant (or the      Participant’s beneficiary or estate) shall be entitled to a full payout of      all Performance Shares (as increased by the Dividend Equivalents), which      shall be paid out at the next scheduled performance share payment      date. |
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|   | (3) | If      prior to payment of all Performance Shares, the Participant is demoted, or      ALLETE or a Business Unit determines, in its sole discretion, that the      Participant’s job performance is unsatisfactory, ALLETE reserves the right      to cancel or amend the Participant’s grant relating to any unpaid      Performance Shares, with the result that some portion or all of the      Participant’s unpaid Performance Shares will be  forfeited. |
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|   | (4) | If      the Participant has a Separation from Service for any reason other than      those specified in subsection (d)(1) above, all Performance Shares and      related Dividend Equivalents to the extent not yet paid shall be forfeited      on the date of such Separation from Service, except as otherwise provided      by the Committee. |
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|   | (i) | unable      to engage in any substantial gainful activity by reason of any medically      determinable physical or mental impairment that can be expected to result      in death or can be expected to last for a continuous period of not less      than twelve (12) months; |
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|   | (ii) | by      reason of any medically determinable physical or mental impairment which      can be expected to result in death or can be expected to last for a      continuous period of not less than twelve (12) months, receiving income      replacement benefits for a period of not less than three (3) months under      the Employer’s accident and healthplan; |
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|   | (iii) | determined      to be totally disabled by the Social Security Administration;      or |
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|   | (iv) | disabled      pursuant to an Employer-sponsored disability insurance arrangement      provided that the definition of disability applied under such disability      insurance program complies with the foregoing definition of      Disability. |
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