Document:

Incentive Compensation Plan of Alcoa Inc

 Exhibit 10.1 
 INCENTIVE COMPENSATION PLAN 
 OF 
 ALCOA INC. 
 (Revised September 15, 2006) 
 Except as provided in Article IV, this Incentive Compensation Plan, revised September 15, 2006, replaces and supersedes the Incentive Compensation
Plan revised January 1, 1993. 
 ARTICLE I - DEFINITIONS 
 For the purposes of this Incentive Compensation Plan (“Plan”), unless a different meaning is clearly required by the context: 
 AWARD YEAR means any calendar year for which awards are made to eligible employees. 
 BOARD means the Board
of Directors of the Company, and includes the Executive Committee or any other duly authorized committee thereof when acting in lieu thereof and/or pursuant to authority delegated thereby. 
 BOARD COMMITTEE means the Compensation and Benefits Committee of the Board of Directors or such other committee selected by the Board of Directors
comprised solely of independent directors. 
 COMMITTEE means the Incentive Compensation Committee and, with respect to awards for officers
of the Company, the Compensation and Benefits Committee of the Board. 
 COMPANY means Alcoa Inc. and any successor thereto. 
 DEFERRED COMPENSATION PLAN means the Company’s Deferred Compensation Plans as amended from time to time. 
 DISABILITY means a mental or physical condition preventing the employee from performing his position satisfactorily, where a qualified physician
designated by the Committee certifies that, in his opinion, the employee’s state of health is such that he should not be burdened with the responsibilities of his position even though he is not totally or permanently disabled. 

 ELIGIBLE EMPLOYEE has the meaning set forth in Article II, Section 2. 
 RETIREMENT means (a) termination of employment in which there is a right to immediate payment of a pension benefit under the provisions of any
retirement plan or arrangement of the Company or a Subsidiary; or (b) termination of employment upon or after attaining age 65 regardless of pension eligibility. 
 SUBSIDIARY means any corporation in which the Company owns, directly or indirectly, stock possessing 50% or more of the total combined voting power of all classes of stock of such corporation, and any corporation,
partnership, joint venture, limited liability company or other business entity as to which the Company possesses a significant ownership interest, directly or indirectly, as determined by the Company. 
 ARTICLE II - PARTICIPATION 
 SECTION 1.
Purpose. The purpose of the Plan is to provide annual cash incentive compensation for Eligible Employees if performance metrics for financial and non-financial performance established by the Committee from time to time are achieved. The
Committee reserves the right to make adjustments to awards to reflect individual performance. 
 SECTION 2. Eligibility. Officers and
other key employees of the Company and its Subsidiaries who have, in the sole judgment of the Committee, contributed to the management, growth, and success of some part or all of the business of those companies shall be eligible for awards under the
Plan (referred to as “Eligible Employees”). 
  

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 SECTION 3. Limits on awards. The aggregate amount of awards for any Award Year shall not exceed an
amount determined by or in accordance with a procedure specified by the Board Committee. All awards shall be granted in accordance with guidelines approved from time to time by the Board Committee and any exceptions to the guidelines require the
approval of the Board Committee. 
 ARTICLE III - AWARDS 
 SECTION 1. Determination. For each Award Year, the Committee shall make awards to such Eligible Employees in such individual amounts as it deems appropriate under the circumstances, taking into account
individual performance and the financial and non-financial performance metrics established by the Committee for the Award Year. 
 SECTION 2.
Cash awards. Except as otherwise determined by the Committee and except for awards or portions of awards which may be deferred, each award shall be paid in cash at a time determined by the Board Committee as soon as practicable following the
Award Year, but in any event no later than March 15 of the year following the Award Year. Cash payment of awards shall be made from the general funds of the Company. In its discretion, the Company may establish one or more trusts or special
funds from which awards may be paid. 
 SECTION 3. Deferred awards. Eligible Employees who are also eligible to participate in the
Deferred Compensation Plan may defer all or part of their awards under this Plan in accordance with the terms of the Deferred Compensation Plan. 
 ARTICLE IV – CONTINGENT CREDITS ISSUED PRIOR TO OR FOR THE YEAR 1990 
 SECTION 1. Contingent credits. Contingent
credits were issued under the Incentive Compensation Plan in effect prior to and for the year 1990. Since 1991, no contingent credits have been issued and the Plan with respect to contingent credits was frozen. The provisions of 
  

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 this Article IV relate solely to contingent credits issued prior to or for the year 1990. Due to the American Jobs
Creation Act of 2004, all remaining contingent credits and earnings thereon shall continue to be subject to the Incentive Compensation Plan provisions in effect as of December 31, 2004, and this Incentive Compensation Plan revised
September 15, 2006, shall not supersede or replace the provisions of the Incentive Compensation Plan revised January 1, 1993 as it pertains to contingent credits. 
 ARTICLE V - ADMINISTRATION 
 SECTION 1. Committee. The Incentive Compensation
Committee for the Plan shall be appointed by the Board and shall have exclusive power and authority to interpret and administer the Plan; provided however, that the Compensation and Benefits Committee of the Board shall have exclusive power and
authority to interpret and administer the Plan with respect to and to make awards to Eligible Employees who are officers of the Company. The Incentive Compensation Committee may take all action, including the adoption of rules and regulations as it
deems appropriate for the administration of the Plan and all determinations by the Committee shall be final and binding upon the Company, its Subsidiaries, Eligible Employees and their beneficiaries. 
 SECTION 2. Amendments. The Board may from time to time amend, modify, suspend or terminate the Plan provided, however, that no such amendment,
modification, suspension or termination shall affect any right or obligation with respect to any award theretofore made. 
 SECTION 3.
Expenses. All expenses of administering the Plan shall be paid by the Company, which in turn may seek reimbursement from subsidiaries. The cost of all awards incurred by the Company with respect to employees of any Subsidiary shall be
reimbursed by the Subsidiary. 
  

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 SECTION 4. Unsecured obligation. No Eligible Employee or other person shall, by virtue of any
award or any unpaid installment thereof, have any interest whatever, either vested or contingent, in any property of the Company or its Subsidiaries. 
 SECTION 5. No rights to employment or awards. Participation in the Plan shall not give any employee the right to continued employment by the Company or its Subsidiaries. Holding the status of an Eligible
Employee shall not give any employee the right to any award. 
 SECTION 6. Taxes. Each Eligible Employee is solely liable for any
taxes due in regards to payments under this Plan, including but not limited to, federal, state, local, social security, foreign and excise taxes under Internal Revenue Code Section 409A if for any reason the Internal Revenue Service determines
that amounts payable under this Plan are subject to the provisions of Section 409A. 
 SECTION 7. Construction. The Plan shall be
construed in accordance with and governed by the laws of the Commonwealth of Pennsylvania, excluding any choice of law provisions which may indicate the application of the laws of another jurisdiction. 
 ARTICLE VI – FORFEITURE AND PRO-RATA PAYMENTS 
 SECTION 1. Forfeiture of Incentive Compensation. If the Board learns of any misconduct by an Eligible Employee that contributed to the Company’s having to restate all or a portion of its financial statements, it shall take such
action as it deems necessary to remedy the misconduct, prevent its recurrence and, if appropriate, based on all relevant facts and circumstances, take remedial action against the wrongdoer in a manner it deems appropriate. In determining what
remedies to pursue, the Board shall take into account all relevant factors, 
  

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 including whether the restatement was the result of negligent, intentional or gross misconduct. The Board shall, to the
full extent permitted by governing law, in all appropriate cases, require reimbursement of any award under the Plan (including any bonus or incentive compensation that has been deferred) if: a) the amount of the award was calculated based upon the
achievement of certain financial results that were subsequently the subject of a restatement, b) the Eligible Employee engaged in intentional misconduct that caused or partially caused the need for the restatement, and c) the amount of the award
that would have been awarded to the Eligible Employee had the financial results been properly reported would have been lower than the amount actually awarded. In addition, the Board, in its full and complete discretion, may dismiss the Eligible
Employee, authorize legal action for breach of fiduciary duty or take such other action to enforce the Eligible Employee’s obligations to the Company as the Board determines fit the facts surrounding the particular case. The Board may, in
determining appropriate remedial action, take into account penalties or punishments imposed by third parties, such as law enforcement agencies, regulators or other authorities. The Board’s power to determine the appropriate punishment for the
wrongdoer is in addition to, and not in replacement of, remedies imposed by such entities. 
 SECTION 2. Pro-rata Distribution upon
Retirement. In the Committee’s discretion, if an Eligible Employee’s Retirement or termination of employment due to a Disability occurs during an Award Year, the Eligible Employee may be awarded a pro-rata portion of the award under
the Plan that would have been paid for the Award Year had the Eligible Employee remained in active service through the end of the Award Year, based on the number of days of active service during the Award Year. 
 SECTION 3. Pro-rata Distribution upon a Change in Control. In the event of a Change in Control, as defined in the 2004 Alcoa Stock Incentive Plan,
as the same may be amended from 
  

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 time to time, or any successor plan approved by the shareholders of the Company, Eligible Employees, at the discretion of
the Committee, may be paid a pro-rata portion of target incentive compensation for the Award Year, based on the days of service during the Award Year from the beginning of the Award Year through the date of the Change in Control. 
 SECTION 4. Pro-rata distribution upon death. Upon the death of an Eligible Employee a pro-rata portion of the award for the Award Year shall be
paid to the Eligible Employee’s beneficiary or beneficiaries, based on the number of days the Eligible Employee was actively employed during the Award Year. 
  

 7Second Amendment to the Fee Continuation Plan

 Exhibit 10.2 
 ALCOA INC. 
 SECOND AMENDMENT TO THE 
 FEE CONTINUATION PLAN FOR NON-EMPLOYEE DIRECTORS 
 (effective
September 15, 2006) 
 WHEREAS, the Fee Continuation Plan for Non-Employee Directors (the “Plan”) of Alcoa Inc. (the
“Company”) was amended November 10, 1995 (the “First Amendment”) to freeze payments to be made under the Plan to directors who were members of the Board at December 31, 1995; and 
 WHEREAS, under the First Amendment, each non-employee Director having 120 or more months of service as a member of the Board of Directors at
December 31, 1995 shall be entitled to receive payments upon retirement from the Board or at age 65 (whichever is later) at 100% of the minimum annual cash retainer fee and annual stock grant amounts, and each non-employee Director having less
than 120 months of service as a member of the Board of Directors at December 31, 1995 shall be entitled to receive Fee Continuation Payments upon retirement from the Board or age 65 (whichever is later) at a rate of 10% of such minimum annual
cash retainer fee and annual stock grant amounts for each full year of service as a non-employee Director as of December 31, 1995; and 
 WHEREAS, the maximum annual payment for eligible Directors under the Plan is $30,000 and 2000 shares and the minimum annual payment for eligible Directors under the Plan is $3,000 and 200 shares; and 
 WHEREAS, it is in the best interest of the Company and the Plan Participants to convert the Plan to an all cash payment plan with equivalent value to the
cash and stock payment formula; and 
 WHEREAS, it is in the best interest of the Company and the future Plan Participants to establish a
fixed date for receipt of payments under the Plan on or before December 31, 2006; and 
  

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 WHEREAS, the Plan Participants and the future Plan Participants have consented to these proposed changes;
and 
 WHEREAS, the Board of Directors have approved such changes; 
 NOW THEREFORE, the Plan, as amended by the First Amendment, is hereby further amended effective September 15, 2006, as follows: 
  

	 	1.	Section 5 of the Plan is amended by deleting the second paragraph thereto and substituting the following: 

 “Beginning in 2007, in lieu of Fee Continuation Payments payable in the form of the Company’s common stock, an additional cash
payment shall be paid annually as soon as practicable following December 31 of each year, in an amount equal to the closing price of the Company’s common stock on December 31 as reported on the New York Stock Exchange – Composite
Transactions, multiplied by the number of shares of the Company’s common stock to which the Participant otherwise would have been entitled under this Plan but for this amendment.” 
  

	 	2.	Section 5 of the Plan is amended by adding the following new paragraph thereto: 

 “The first paragraph of Section 5 of the Plan shall not apply to Participants who have not retired from the Board of Directors
as of the effective date of the Second Amendment to the Plan. In lieu thereof, such Participants shall make an irrevocable election before December 31, 2006 whether to receive Fee Continuation Payments which are payable in cash upon retirement
(A) quarterly on a prorated basis, payable immediately after the end of the calendar quarter for which paid or (B) annually, payable immediately after the end of the calendar year for which paid. In either case, the final payment shall be
made for the quarter in which death occurs. Payment of the amounts described in Section 8 of the Plan shall be governed by that section.” 
  

	 	3.	The following new Section 8 is added to the Plan: 

 “Section 8. Additional Payments. 
 (a) If the Board of Directors requests a non-employee Director who is
entitled to Fee Continuation Payments under the Plan to remain a member of the Board of Directors beyond the Normal Retirement Date (as defined below), and the director 
  

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 agrees and continues as a member of the Board until retirement at a later date (the period from the
Normal Retirement Date to the later retirement date, the “Additional Period”), then a lump sum payment in cash shall be made to the director within 2 1/2 months after retirement from the Board equal to the total of the following: 
  

	 	(i)	the sum of the Fee Continuation Payments the director would have received during the Additional Period had the director retired at the Normal Retirement Date (the “Additional
Payments”); provided, that the annual stock grant portion of the Additional Payments shall be paid in cash in lieu of shares of Company common stock, with the cash value determined by multiplying the number of shares payable by the
closing price of Company common stock as reported on the New York Stock Exchange – Composite Transactions on the date(s) the annual stock grant(s) would have been issued during the Additional Period had the director retired at the Normal
Retirement Date; 

  

	 	(ii)	interest at Market Rate (as defined below) on the annual cash retainer fee portion of the Additional Payments, calculated from the date such annual cash retainer fee portion would
have been paid during the Additional Period had the director retired at the Normal Retirement Date to the date of the director’s retirement from the Board. The Market Rate shall be determined in January of each calendar year during the
Additional Period and shall apply to the annual cash retainer fees payable for that year until such fees are paid out. Such interest shall be compounded annually on December 31 of each year during the Additional Period; and

  

	 	(iii)	cash equal to dividends that would have been paid on the annual stock grant portion of the Additional Payments during the Additional Period had the director retired at the Normal
Retirement Date. Such dividend equivalents shall be calculated at the same rate as dividends paid on shares of outstanding Company common stock. 

 (b) For purposes of this Section 8, the following terms shall have the following meanings: 
  

	 	i.	“Market rate” means the applicable federal long-term rate, with annual compounding (as prescribed under Section 1274(d) of the Internal Revenue Code of 1986, as
amended). 

  

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	 	ii.	“Normal Retirement Date” means for Directors who were requested to stand for re-election at a time when the Normal Retirement Date was 70, age 70; and, for Directors who
were requested to stand for re-election at a time when the Normal Retirement Date was 72, age 72. For avoidance of doubt, if a Director was asked to stand for re-election more than one time, the calculation will begin at the time of the first such
request. 

  

	 	4.	In all other respects, the Plan is ratified and confirmed. 

  

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