1.1 Purpose . Nicor Inc. Salary Deferral Plan (the “Plan”) has been established by Nicor Inc. (the “Company”) so that it, and each of its Affiliates which, with the consent of the Company, adopts the Plan may provide its eligible key management employees with an opportunity to build additional financial security, thereby aiding such companies in attracting and retaining employees of exceptional ability.

1.2 Effective Date, Grandfathering . The “Effective Date” of the amended and restated Plan is January 1, 2008, but the terms of this amended and restated Plan shall apply only to amounts deferred under this Plan after December 31, 2004 (and the interest earned thereon) and amounts earned but not vested as of December 31, 2004. Notwithstanding any provisions of the Plan to the contrary, the provisions of the Plan in effect on October 3, 2004 and not the provisions of this amended and restated Plan shall apply to those amounts that were earned and vested under the Plan within the meaning of Treas. Reg. §§1.409A-6(a) as of December 31, 2004, as well as the interest earned thereon (“Grandfathered Benefits”). The terms applicable to the Grandfathered Benefits have not been materially modified within the meaning of Treas. Reg. §§1.409A-6(a)(1) and (4) on or after October 3, 2004.

1.3 Affiliates and Employers . The term “Affiliate” means any corporation, trade or business during any period during which it is, along with the Company (or, before the Company was established, Northern Illinois Gas Company now doing business as Nicor Gas (“Nicor Gas”)), a member of a controlled group of corporations or a controlled group of trades or businesses, as described in Section 414(b) and 414(c) of the Internal Revenue Code of 1986, as amended (the “Code”). The Company and each Affiliate that adopts the Plan for the benefit of its eligible employees are referred to below collectively as the “Employers” and individually as an “Employer”.

1.4 Plan Administration, Source of Benefit Payments . The authority to control and manage the operation and administration of the Plan shall be vested in the compensation committee (the “Committee”) of the Board of Directors of the Company (the “Board”). In controlling and managing the operation and administration of the Plan, the Committee shall have the rights, powers and duties set forth in Section 7. The amount of any benefit payable under the Plan shall be paid from the general assets of the Employer with respect to whose employee or former employee the benefit is payable. Subject to the provisions of the Plan, the liability of an Employer (the “Original Employer”) with respect to a Participant on account of reduction in the Participant’s cash remuneration from the Original Employer pursuant to a Deferral Election shall not be affected by the Participant’s leaving the employ of such Original Employer to become an employee of another Employer or an Affiliate (the “New Employer”); provided, however, that, with the consent of the Original Employer and the New Employer, but without the consent of the Participant, the liability of the Original Employer may be transferred to the New Employer. In

the event of such transfer (a) the Original Employer shall thereafter have no obligation to the Participant under the Plan, and (b) the New Employer’s rights and obligations with respect to the Participant shall be governed by the terms of the Plan, with the New Employer substituted for the Original Employer under the Plan. Neither the Participant nor any other person shall acquire by reason of the Plan any right in or title to any assets, funds or property of the Employers whatsoever, including, without limiting the generality of the foregoing, any specific funds, assets, or other property which the Employers, in their sole discretion, may set aside in anticipation of a liability under the Plan. The Participant shall have only a contractual right to the amounts, if any, payable under the Plan, unsecured by any assets of the Employers. Nothing contained in the Plan shall constitute a guarantee by any of the Employers that the assets of the Employers shall be sufficient to pay any benefits to any person.

1.5 Plan Year . The term “Plan Year” means the twelve-consecutive-month period beginning on each January 1.

1.6 Applicable Laws . The Plan shall be construed and administered in accordance with the laws of the State of Illinois to the extent that such laws are not preempted by the laws of the United States of America.

1.7 Gender and Number . Where the context admits, words in any gender shall include any other gender, words in the singular shall include the plural and the plural shall include the singular.

1.8 Notices . Any notice or document required to be filed with the Committee under the Plan will be properly filed if delivered or mailed by registered mail, postage prepaid, to the Committee, in care of the Company, at its principal executive offices. Any notice required under the Plan may be waived by the person entitled to notice.

1.9 Form and Time of Elections . Unless otherwise specified herein, each election permitted to be made by any Participant or other person entitled to benefits under the Plan, and any permitted modification or revocation thereof, shall be in writing filed with the Committee at such times and in such form as the Committee shall require.

1.10 Evidence . Evidence required of anyone under the Plan may be by certificate, affidavit, document or other information which the person acting on it considers pertinent and reliable, and signed, made or presented by the proper party or parties.

1.11 Action by Employers . Any action required or permitted to be taken by any Employer shall be by resolution of its Board of Directors, or by a duly authorized officer of the Employer.

1.12 Defined Terms . Terms used frequently with the same meaning are indicated by initial capital letters, and are defined throughout the Plan. Appendix A contains an alphabetical listing of all such terms and the subsections in which they are defined.

SECTION 2

Participant Elections

2.1 Eligible Participants . Employees of any Employer who shall be eligible to participate in the Plan shall be determined by the compensation committee of that Employer. Notwithstanding the foregoing provisions of this subsection 2.1, participation in the Plan shall be

limited to a select group of management or highly compensated employees within the meaning of Sections 201, 301 and 401 of the Employee Retirement Income Security Act of 1974, as amended (“ERISA”), as determined by the Committee.

2.2 Deferral Elections . An individual’s participation in the Plan shall be subject to the following:

(a)

An employee of an Employer who, prior to the beginning of any Plan Year, has been designated by the compensation committee of such Employer as eligible to participate in the Plan for the Plan Year shall become a Participant for that year by filing an election (“Deferral Election”) before the first day of that year.

(b)

The Participant shall elect, by his Deferral Election, to have the amount of Salary that would otherwise be payable to him from the Employer during each pay period during the Plan Year for which the Deferral Election is in effect reduced by an amount that is not less than 2 percent nor more than 10 percent (in multiples of 1 percent) of his Salary for each such pay period. If a Participant’s rate of Salary changes from pay period to pay period, there shall be a corresponding change in the amount of the reduction in his cash remuneration pursuant to his Deferral Election, so that the percentage of Salary subject to such election remains constant.

(c)

The Participant shall elect, by his Deferral Election, to have the amount of Bonus that would otherwise be payable to him from the Employer after the end of the Plan Year for which the Deferral Election is in effect reduced by an amount that is not less than 10 percent nor more than 20 percent (in multiples of 1 percent) of his Bonus for such Plan Year.

(d)

In the event that a Participant ceases to be a member of the group of employees to which the Plan is then extended, then Salary and Bonus reductions as previously elected will continue for the remainder of the Plan Year; however, the former Participant will not be permitted to file a Deferral Election for subsequent years unless he again becomes a member of the group of employees to which the Plan is extended.

(e)	Notwithstanding any provision of the Plan to the contrary, a Deferral Election shall be automatically cancelled on the Participant’s Termination Date (as defined in Section 4) and shall be without effect thereafter.

(f)	No new Deferral Election shall be accepted after a Change in Control.

(g)

A Participant’s Deferral Election for any Plan Year shall be applicable to Salary paid in that Plan Year and to Bonus for that Plan Year, but such Bonus is paid after the end of the Plan Year. Except as otherwise provided in subsection 5.5, a Participant’s Deferral Election shall be irrevocable as of the day immediately before the Plan Year to which it applies.

2.3 Distribution Elections . Distribution of a Participant’s Account under the Plan shall be subject to the following:

(a)

Each Participant shall file a Distribution Election prior to the first day of each Plan Year in which deferrals are made on his behalf under the Plan (or under the transition rules of Code Section 409A, prior to January 1, 2009). Such Distribution Election shall apply for the deferrals made on his behalf under the Plan with respect to such Plan Year, and shall be irrevocable as of the day immediately preceding such Plan Year.

(b)	A Participant may change his Distribution Election after it has become irrevocable for a Plan Year by submitting a modified Distribution Election to the Committee under the rules of the Plan, and in accordance with the following criteria:

(i)

The election of the new form of payment or payment schedule shall have no effect until at least 12 months after the date on which the election is made;

(ii)

The initial payment date under the modified Distribution Election must be the first day of a calendar year that is no sooner than five (5) years after the previously designated initial payment date (unless the modified election is with respect to benefits payable upon death, in accordance with subsection 4(d)); and

(iii)

The election must be made at least 12 months prior to the Participant's previously designated initial payment date.

A Participant’s modified Distribution Election shall not be considered to be made until the date on which the election becomes irrevocable. Such an election shall become irrevocable no later than the date that is 12 months prior to the Participant’s previously designated initial payment date. Any such modified Distribution Election must comply with the requirements of subsections 5.7 and 5.8, including, without limitation, with respect to the period of time during which benefits may be payable. Installment payments shall be treated as a single payment for purposes of Code Section 409A.

2.4 Prior Plan Elections . Participant elections with respect to Grandfathered Benefits shall be governed by the terms of the Plan as in effect on October 3, 2004.

2.5 Salary . For purposes of the Plan, a Participant’s “Salary” from any Employer means the regular basic cash remuneration paid to him for such period by reason of his employment with that Employer as a Participant, excluding bonuses, overtime pay, and all other kind of remuneration of any kind including, but not limited to pre-paid salary increase advances and lump sum raise payments, and including vacation pay, reductions in cash remuneration under this Plan, reductions to reflect contributions under a plan described in Section 125 of the Code and contributions under a cash or deferred arrangement described in Section 401(k) of the Code.

2.6 Bonus . For purposes of the Plan, a Participant’s “Bonus” from any Employer means the gross annual bonus amount(s) payable to a Participant from the Employer’s annual incentive plan(s), if any, in effect for the Employer’s fiscal year coinciding with the Plan Year (but payable

after the end of the Plan Year) otherwise payable in cash, and considered “wages” for FICA and federal income tax withholding; provided, however, that a participant’s bonus shall be determined without regard to any reduction to reflect contributions under a plan described in Section 125 of the Code or contributions under a cash or deferred arrangement described in Section 401(k) of the Code, or any amount deferred under an unfunded, nonqualified plan maintained by the Employer.

2.7 Plan Not Contract of Employment . The Plan does not constitute a contract of employment, and participation in the Plan will not give any employee or Participant the right to be retained in the employ of any Employer nor any right or claim to any benefit under the Plan, unless such right or claim has specifically accrued under the terms of the Plan.

SECTION 3

Plan Accounting

3.1 Accounts . For each Participant who has filed a Deferral Election, the Committee shall establish an Account. A Participant’s Account balance as of any date shall be equal to the amount determined in accordance with the following provisions of this subsection 3.1 based on the Interest Yield then applicable to such Account balance:

(a)	first, credit to the Account balance the applicable Interest Yield based on the average Account balance for the previous day;

(b)	then, charge to the Account balance the amount of any distributions under the Plan with respect to that Account balance as of that date; and

(c)	then, credit to the Account balance the amount to be credited as of that date in accordance with subsection 3.4.

The foregoing provisions shall apply so long as a Participant has an account balance under the Plan, even if the Participant is no longer eligible to file a Deferral Election pursuant to subsections 2.2 or 5.5.

The Committee may establish lump sum and installment distribution subaccounts under a Participant’s Account to reflect those amounts pursuant to which the Participant has made an election to receive lump sum or installment distributions as provided in subsections 5.7 and 5.8 pursuant to an applicable Distribution Election.

A distribution to a Participant pursuant to the provisions of subsection 5.5 shall not affect the Interest Yield used to determine the Participant’s Account balance as of any subsequent date. Accordingly, if any amounts are distributed to or on behalf of a Participant under the Plan at a time when the Account balance is to be determined in accordance with the Termination Interest Yield, then the Participant’s Account balance shall be recomputed using the Termination Interest Yield from the date each such deferral was first made. If any amounts are distributed to or on behalf of a participant under the Plan at a time when the Account balance is to be determined in accordance with the Retirement Interest Yield, the Participant’s Account balance shall be recomputed from the date such deferrals were first made, using the Retirement Interest Yield.

3.2 Limit on Crediting of Interest . Notwithstanding the foregoing provisions of this Section 3, a Participant’s Account balance shall not be credited with interest in accordance with the provisions of paragraph 3.1(a) with respect to the amount of any payment or distribution for the period occurring after the date as of which such amount is to be paid in accordance with the provisions of the Plan (such payment date calculated to include any delay due to regulatory requirements), regardless of the date on which payment is actually made.

3.3 Interest Yield . The applicable “Interest Yield” for any date in any calendar quarter shall be equal to:

(a)	for any portion of the Account balance to be determined on the basis of the Termination Interest Yield, the applicable Interest Yield shall be 100% of the Bond Rate for the next preceding calendar quarter (or other time period deemed appropriate by the Committee); and

(b)	for any portion of the Account balance to be determined on the basis of the Retirement Interest Yield, the applicable Interest Yield shall be 130% of the Bond Rate for the next preceding calendar quarter (or other time period deemed appropriate by the Committee).

The “Bond Rate” for any calendar quarter (or other time period deemed appropriate by the Committee) shall be the composite average yield of industrial and public utility bonds, rated Aaa through Baa for that period, as determined from Mergent Bond Record published monthly by Mergent FIS, Inc. (or any successor thereto) or, if such yield is no longer available, a substantially similar average selected by the Committee.

3.4 Crediting Under Deferral Election . A Participant’s Account balance shall be credited, in accordance with the provisions of paragraph 3.1(c), with the amount by which his Salary and/or Bonus from his Employer is reduced pursuant to a Deferral Election, as of the date on which such Salary and/or Bonus would otherwise have been paid to the Participant by the Employer were it not for the reduction made pursuant to the Deferral Election.

3.5 Limit on Distributions . In no event shall the amount distributed under the Plan with respect to any Participant as of any date exceed the amount of his Account balance as of that date.

SECTION 4

Termination Date

A Participant’s “Termination Date” is the first to occur of the following dates:

(a)	Normal Retirement . The date of the Participant’s Separation from Service after the Participant has attained age 65. For purposes of the Plan, a Participant’s “Separation from Service” is the date of termination of th

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