LACLEDE GAS COMPANY SUPPLEMENTAL RETIREMENT BENEFIT PLAN II

LACLEDE GAS COMPANY

SUPPLEMENTAL RETIREMENT BENEFIT PLAN II

EFFECTIVE as of January 1, 2005

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

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

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;

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

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.

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