EXHIBIT 10.52

 

DUKE ENERGY CORPORATION
EXECUTIVE CASH BALANCE PLAN

(Amended and Restated Effective as of January 1, 2014)

ARTICLE I
PURPOSE OF PLAN

The purpose of the Duke Energy Corporation Executive Cash Balance Plan (the
“Plan”) is to provide additional retirement benefits for a select group of
management or highly compensated employees.  The Plan originally was effective
as of January 1, 1997 and was amended thereafter from time to time. Effective
January 1, 1999, the Plan replaced the PanEnergy Corp Key Executive Retirement
Benefit Equalization Plan and all benefits provided thereunder were provided in
accordance with the terms set forth herein. The Plan is intended to be a
non-qualified, unfunded plan of deferred compensation for a select group of
management or highly compensated employees under the Employee Retirement Income
Security Act of 1974, as amended (“ERISA”), and shall be so interpreted and
administered.  Effective August 26, 2008, the Plan was amended and restated in
its entirety in order to comply with Section 409A of the Internal Revenue Code
of 1986, as amended (the “Code”).  Effective on July 2, 2012, the Plan was
amended and restated in its entirety to reflect the participation by, and
assumption of the obligations of, certain individuals who participated in or,
but for the service eligibility requirements, would have participated in the
Amended and Restated Supplemental Senior Executive Retirement Plan of Progress
Energy, Inc. (the “Progress Nonqualified Plan”).  Effective January 1, 2014, the
Plan is hereby amended and restated in its entirety, as set forth herein, to
reflect the mergers of the Amended and Restated Progress Energy, Inc.
Restoration Retirement Plan (the “Progress RRP”) and Cinergy Corp. Excess
Pension Plan (the “Cinergy Excess Plan”) with and into the Plan and to close
participation in the Plan to new hires and rehires. 

The Plan was divided into two separate parts, one of which is referred to herein
as “Part I” and the other is referred to herein as “Part II.”  Any “amounts
deferred” under the Plan in taxable years beginning before January 1, 2005
(within the meaning of Section 409A of the Code) and any earnings thereon shall
be governed by the terms of Part I of the Plan, as set forth herein.  It is
intended that such amounts and the earnings thereon shall be exempt from the
application of Section 409A of the Code.  Nothing contained herein is intended
to materially enhance a benefit or right existing under Part I of the Plan as of
October 3, 2004, or add a new material benefit or right to Part I of the Plan. 
As of January 1, 2005 (“Effective Date”), Part I of the Plan was frozen, and
neither the Company, its affiliates nor any individual shall make or permit to
be made any additional contributions or deferrals under Part I of the Plan
(other than earnings) on or after that date.

Any “amounts deferred” in taxable years beginning on or after January 1, 2005
(within the meaning of Section 409A of the Code) and any earnings thereon shall
be governed by the terms and conditions of Part II of the Plan, as set forth
herein.  To the extent that any of those amounts were credited under the Plan
prior to the Effective Date (the “Transferred Amounts”), then the Committee
shall transfer the Transferred Amounts from Part I of the Plan to Part II of the
Plan and credit those amounts to the appropriate bookkeeping accounts under Part
II of this Plan, as selected by the Committee in its sole discretion.  As a
result of such transfer and crediting, all of the Company’s obligations and
Participant’s rights with respect to the Transferred Amounts under Part I of the
Plan, if any, shall automatically be extinguished and become obligations and
rights under Part II of this Plan without further action.  For purposes of
clarity, (i) the obligations assumed from Part I of the Cinergy Excess Plan
shall be governed by the terms and conditions of Part I of the Plan, as set
forth herein, and (ii) the obligations assumed from the Progress Nonqualified
Plan, the Progress RRP, and Part II of the Cinergy Excess Plan shall be governed
by the terms and conditions of Part II of the Plan, as set forth herein.

ARTICLE II
DEFINITIONS

Wherever used herein, a pronoun or adjective in the masculine gender includes
the feminine gender, the singular includes the plural, and the following terms
have the following meanings unless a different meaning is clearly required by
the context.  Additional terms are defined throughout the Plan.

2.1           “Affiliated Group” shall mean, except as otherwise provided in
Exhibit A, the Company and all entities with whom the Company would be
considered a single employer under Sections 414(b) and 414(c) of the Code,
provided that in applying Section 1563(a)(1), (2), and (3) for purposes of
determining a controlled group of corporations under Section 414(b) of the Code,
the term “at least 45 percent” is used instead of “at least 80 percent” each
place it appears in Code Section 1563(a)(1), (2), and (3), and in applying
Treasury Regulation Section 1.414(c)-2 for purposes of determining trades or
businesses (whether or not incorporated) that are under common control for
purposes of Section 414(c), the term “at least 45 percent” is used instead of
“at least 80 percent” each place it appears in that regulation. Such term shall
be interpreted in a manner consistent with the definition of “service recipient”
contained in Section 409A of the Code.  Notwithstanding the foregoing, for
purposes of determining whether a Progress Nonqualified Plan Participant or
Progress RRP Plan Participant has incurred a Separation from Service with the
Affiliated Group under Section 6.9 or 6.10, the phrase “at least 45 percent” is
deleted in each place that it appears in this Section 2.1 and replaced with the
phrase “at least 50 percent”.

2.2           “Beneficiary” means, except as otherwise provided, the person or
persons designated by a Participant, or by another person entitled to receive
benefits hereunder, to receive benefits following the death of such person.

2.3           “Board of Directors” means the Board of Directors of Duke Energy
Corporation.

2.4           “Change in Control” shall be deemed to have occurred upon:

(a)           an acquisition by any individual, entity or group (within the
meaning of Section 13(d)(3) or 14(d)(2) of the Securities Exchange Act of 1934,
as amended (the “Exchange Act”)) (a “Person”) of beneficial ownership (within
the meaning of Rule 13d-3 promulgated under the Exchange Act) of 30% or more of
either (A) the then outstanding shares of common stock of Duke Energy
Corporation or (B) the combined voting power of the then outstanding voting
securities of Duke Energy Corporation entitled to vote generally in the election
of directors; excluding, however, the following: (1) any acquisition directly
from Duke Energy Corporation, other than an acquisition by virtue of the
exercise of a conversion privilege unless

 

--------------------------------------------------------------------------------

 

 

the security being so converted was itself acquired directly from Duke Energy
Corporation, (2) any acquisition by Duke Energy Corporation and (3) any
acquisition by an employee benefit plan (or related trust) sponsored or
maintained by Duke Energy Corporation or its affiliated companies;

(b)           during any period of two (2) consecutive years, individuals who at
the beginning of such period constitute the Board of Directors (and any new
directors whose election by the Board of Directors or nomination for election by
the Duke Energy Corporation’s shareholders was approved by a vote of at least
two-thirds (2/3) of the directors then still in office who either were directors
at the beginning of the period or whose election or nomination for election was
so approved) cease for any reason (except for death, disability or voluntary
retirement) to constitute a majority thereof;

(c)           the consummation of a merger, consolidation, reorganization or
similar corporate transaction, which has been approved by the shareholders of
Duke Energy Corporation, whether or not Duke Energy Corporation is the surviving
corporation in such transaction, other than a merger, consolidation, or
reorganization that would result in the voting securities of Duke Energy
Corporation outstanding immediately prior thereto continuing to represent
(either by remaining outstanding or by being converted into voting securities of
the surviving entity) at least 50% of the combined voting power of the voting
securities of Duke Energy Corporation (or such surviving entity) outstanding
immediately after such merger, consolidation or reorganization;

(d)           the consummation of (A) the sale or other disposition of all or
substantially all of the assets of Duke Energy Corporation or (B) a complete
liquidation or dissolution of Duke Energy Corporation, which has been approved
by the shareholders of Duke Energy Corporation; or

(e)           adoption by the Board of Directors of a resolution to the effect
that any Person has acquired effective control of the business and affairs of
Duke Energy Corporation.

2.5           “Code” means the Internal Revenue Code of 1986, as amended.

2.6           “Committee” means the Compensation Committee of the Board of
Directors or its delegate.

2.7           “Company” means Duke Energy Corporation and its affiliated
companies.

2.8           “Compensation” means “Compensation” as defined in the Retirement
Cash Balance Plan but without regard to the limitations of Code Section
401(a)(17) and including Employee deferrals (except for deferrals of long-term
incentive awards) under the Duke Energy Corporation Executive Savings Plan.

2.9           “Employee” means a person employed by the Affiliated Group.

2.10         “Equalization Plan” means the PanEnergy Corp Key Executive
Retirement Benefit Equalization Plan as it existed on December 31, 1998.

2.11         “Interest Credit” means an amount credited pursuant to Section 4.4
of the Plan.

2.12         “Interest Factor” means the rate determined by the formula (1+i),
raised to the one-twelfth (1/12th) power, minus one (1), rounded to the third
decimal place.  For example, when “i” is 4%, the Interest Factor is 0.327%.  For
this purpose, “i” equals the following:

(a)            For benefits accrued on or after January 1, 2013, four percent
(4%).

(b)            For benefits accrued prior to January 1, 2013, the yield on
30-year Treasury Bonds as published in the Federal Reserve Statistical Release
H.15 for the end of the third full business week of the month prior to the
beginning of the calendar quarter for which the monthly accrual is being
applied, but not more than an annual percentage rate of nine percent (9%) and
not less than an annual percentage rate of four percent (4%).

2.13         “Make-Whole Benefit” means the benefit provided pursuant to Section
4.2 of the Plan.

2.14         “Participant” means an Employee who is entitled to receive benefits
from the Plan.

2.15         “Part I” and “Part II” of the Plan are defined in Article I.

2.16         “Pay Credit” means a credit that is added to a Participant’s
Make-Whole Account pursuant to Section 4.2.

2.17         “Plan” means the Duke Energy Corporation Executive Cash Balance
Plan.

2.18         “Retirement Cash Balance Plan” means (i) for purposes of Part I,
the Duke Energy Retirement Cash Balance Plan as in effect on October 3, 2004,
without giving effect to amendments adopted thereafter, and (ii) for purposes of
Part II, the Duke Energy Retirement Cash Balance Plan as in effect from time to
time.  For a Progress Nonqualified Plan Participant (as defined in Section 3.3),
Retirement Cash Balance Plan also means, for periods on and after July 2, 2012,
the Progress Qualified Retirement Plan (as defined in Exhibit A).  For a
Progress RRP Participant (as defined in Section 3.4), Retirement Cash Balance
Plan also means, for periods on and after January 1, 2014, the Progress
Qualified Retirement Plan (as defined in Exhibit A).

2.19         “Separation from Service” shall mean a termination of employment
with the Affiliated Group in such a manner as to constitute a “separation from
service” as defined under Section 409A of the Code.  To the extent permitted by
Section 409A of the Code, the Committee retains discretion, in the event of a
sale or other disposition of assets, to specify whether a Participant who
provides services to the purchaser immediately after the transaction has
incurred a Separation from Service.

 

--------------------------------------------------------------------------------

 

 

2.20         “Specified Employee” shall mean, as of any date, a “specified
employee”, as defined in Section 409A of the Code (as determined under the
Company’s policy for identifying specified employees on the relevant date), of
the Company or any entity which would be considered to be a single employer with
the Company under Section 414(b) or Section 414(c) of the Code.

2.21         “Supplemental Credit” means a credit that is added to a
Participant’s Supplemental Account pursuant to Section 4.3.

2.22         “Supplemental Benefit” means the benefit provided under Section 4.3
of the Plan.

2.23         “Supplemental Retirement Plan” means the Supplemental Retirement
Plan for Employees of Duke Power Company as it existed on December 31, 1996.

2.24         “Supplemental Security Plan” means the Duke Power Company
Supplemental Security Plan as it existed on December 31, 1996.

ARTICLE III
ELIGIBILITY

3.1           General Rule.  Any Employee designated by the Committee shall be
eligible to participate in the Plan and shall remain eligible as long as he
continues to be an Employee or, except for a Progress Nonqualified Plan
Participant, until designated ineligible by the Committee.  No Employee who
becomes employed by the Affiliated Group or is reemployed by the Affiliated
Group on or after January 1, 2014 shall be eligible to participate or to
participate again in the Plan.  Notwithstanding the foregoing, an Employee who
is not a member of a “select group of management or highly compensated
employees” within the meaning of ERISA, may not participate in the Plan. 
Participants shall not receive any benefits under the terms of the Supplemental
Retirement Plan, the Supplemental Security Plan or the Equalization Plan.  For
purposes of clarity, the eligibility rules of Article III are subject to
amendment as provided in Article VIII. 

3.2           Former Employees.  Former Employees, (i) whose Company employment
terminated before January 1, 1997, and who had accrued benefits under the
Supplemental Retirement Plan or Supplemental Security Plan, or (ii) whose
Company employment terminated before January 1, 1999, and who had accrued
benefits under the Equalization Plan, will receive payment, or will continue to
receive payment, of such benefits under the terms of such plans. Such former
Employees will not participate in this Plan.

3.3           Progress Nonqualified Plan Participants.  Effective as of July 2,
2012, each individual who (i) as of January 8, 2011 served on the Progress
Energy, Inc. Senior Management Committee, (ii) participated in or, but for the
service eligibility requirements, would have participated in the Progress
Nonqualified Plan, and (iii) was an employee of Progress Energy, Inc., or its
affiliates, in each case immediately prior to July 2, 2012 (each, a “Progress
Nonqualified Plan Participant”) became eligible to participate in the Plan as of
July 2, 2012 and shall remain eligible as long as he continues to be an
Employee.  The obligations and rights of the Progress Nonqualified Plan
Participants under the Progress Nonqualified Plan were extinguished as of July
2, 2012 and became obligations and rights under this Plan, as set forth herein. 
For purposes of clarity, the obligations and rights of participants in the
Progress Nonqualified Plan other than the Progress Nonqualified Plan
Participants shall not become obligations or rights under this Plan.

3.4           Progress RRP Participants.  Effective as of January 1, 2014, each
individual who was a participant in or, but for the service eligibility
requirements, would be a participant in the Progress RRP on December 31, 2013
(each, a “Progress RRP Participant”), shall be eligible to participate in the
Plan as of January 1, 2014.  The obligations and rights of the Progress RRP
Participants under the Progress RRP shall automatically be extinguished as of
January 1, 2014 and shall become obligations and rights under this Plan, as set
forth herein.  For purposes of clarity, each Progress RRP Participant shall be
entitled to the Progress RRP benefit provided in Section 6.10 and have a
Make-Whole Account (with an opening balance of zero dollars ($0.00)) established
under the Plan as of January 1, 2014.

3.5  Cinergy Excess Plan Participants.  Effective as of January 1, 2014, each
individual who was a participant in the Cinergy Excess Plan on December 31, 2013
(each, a “Cinergy Excess Plan Participant”), shall be eligible to participate in
the Plan as of January 1, 2014.  The obligations and rights of the Cinergy
Excess Plan Participants under the Cinergy Excess Plan shall automatically be
extinguished as of January 1, 2014 and shall become obligations and rights under
this Plan, as set forth herein.  For purposes of clarity, each Cinergy Excess
Plan Participant who had a cash balance make-whole account and/or supplemental
account under the Cinergy Excess Plan shall have a Make-Whole Account and/or
Supplemental Account established under the Plan as of January 1, 2014 with an
opening balance equal to the balance in the cash balance make-whole account
and/or supplemental account respectively under the Cinergy Excess Plan as the
close of December 31, 2013.  The categories of Cinergy Excess Plan Participants
are listed in Exhibit B.

ARTICLE IV
BENEFITS

4.1           General Rule.  The Plan provides a Make-Whole Benefit and may
provide a Supplemental Benefit.  Each Participant shall have a Make-Whole
Account (with an opening balance of zero dollars ($0.00) except as otherwise
provided), which is a bookkeeping account established under this Plan and shall
be eligible for a Make-Whole Benefit. The Committee will determine whether a
Participant is to be eligible for a Supplemental Benefit, in which case a
“Supplemental Account,” which is a bookkeeping account, shall be established.

4.2           Pay Credits to the Make-Whole Account.  Under the Make-Whole
Benefit, for any month that a Participant is eligible to participate in this
Plan, the Participant’s Make-Whole Account shall receive a Pay Credit equal to
the excess, if any, of (a) the pay credit that would have been provided under
the Retirement Cash Balance Plan for the month if the Retirement Cash Balance
Plan used the definition of Compensation set forth herein and, to the extent
determined by the Committee from time to time, other types of excluded pay were
treated as eligible compensation under such Plan; over (b) the pay credit for
the month that is actually made to the Participant’s account under the
Retirement Cash Balance Plan.  In addition, the Make-Whole Benefit provides a
Pay Credit to the Participant’s Make-Whole Account equal to any reduction in a
benefit under the Retirement Cash Balance Plan (for purposes of clarity, note
that this includes the Progress Qualified Retirement Plan) resulting from the
limitations imposed by Section 415 of the Code.  Where an opening account
balance under the Retirement Cash Balance Plan has been established for a
Participant, the Committee, in its sole discretion, may establish an opening
balance for the Participant’s Make-Whole Account that is designed to provide a
transition benefit comparable to the benefit provided through the Retirement
Cash Balance Plan opening account balance, but without regard to the limitations
imposed by Sections 401(a)(17) or 415 of the Code.  If the value of the benefit
which a vested Participant had accrued under the Supplemental Retirement Plan as
of December 31, 1996, is greater than the value of the Participant’s Make-Whole
Account on the date the Participant retires, such higher value shall apply.

--------------------------------------------------------------------------------

 

 

4.3           Supplemental Credits.  A Participant’s Supplemental Account shall
receive such Supplemental Credits, in such amounts and at such times, as the
Committee, in its sole discretion, may determine.  Supplemental Credits may
include, but are not limited to, an opening account balance or a one-time credit
in recognition of the December 31, 1998, discontinuance of supplemental pay
credits. Notwithstanding Sections 4.3 and 4.4 to the contrary, the Minimum
Benefit feature of Section 4.3(e) of the Plan, as in effect prior to January 1,
1999, is preserved herein and incorporated by reference.

4.4           Interest Credits.  An Interest Credit will be added to a
Participant’s Make-Whole Account and to a Participant’s Supplemental Account as
of the end of each calendar month ending prior to the month in which the
respective account is fully distributed or forfeited. The amount of the Interest
Credit for a month will equal the balance of the respective account as of the
end of the prior month (after adding any Pay Credit, Supplemental Credit and
Interest Credit for the prior month and subtracting any payment or forfeiture
for the prior month) multiplied by the Interest Factor for the month.
Notwithstanding the foregoing, and for purposes of Part I only, Interest Credits
to the Supplemental Account of a Participant whose employment with the Company
terminates before attaining the earliest retirement age under the Retirement
Cash Balance Plan will be suspended beginning with the month during which
employment terminates and will not resume until the month following the month
during which payment of the Supplemental Benefit commences.

ARTICLE V
VESTING

5.1           General Rule.  Unless the Committee provides otherwise for a
particular Participant at the time the Participant initially becomes eligible to
participate in the Plan or at the time of an award of a particular Supplemental
Credit (and any Interest Credits thereto), a Participant will become fully
vested in the Participant’s Make-Whole Account, and the Participant’s
Supplemental Account, if any, when (i) the Participant becomes vested under the
Retirement Cash Balance Plan, or (ii) the Participant’s employment with the
Company terminates on account of the Participant’s death or the Participant
having become “Disabled”, as defined in the Retirement Cash Balance Plan.  If a
Participant’s employment with the Company terminates and the Participant is not
fully vested, the unvested portion of the Participant’s Make-Whole Account and
of the Participant’s Supplemental Account, if any, shall be immediately
forfeited and no benefit under the Plan shall be paid with respect thereto. 
Notwithstanding the foregoing, a Progress Nonqualified Plan Participant shall
become vested in, and entitled to a benefit under, the Plan after completing:
(a) 10 years of Service (as defined in Exhibit A) and (b) three years of
employment at the level of “Senior Vice President and above,” which shall
include (I) for periods prior to July 2, 2012, employment with Progress Energy,
Inc. and its affiliates at the Senior Vice President and above level, and (II)
for periods after July 2, 2012, any employment with the Company. 
Notwithstanding the foregoing, a Progress RRP Participant shall be subject to
the following with respect to the Progress RRP Participant’s Progress RRP
benefit:

(a)           Any Progress RRP Participant who terminates employment with the
Affiliated Group without being 100% vested under the Progress Qualified
Retirement Plan shall not be eligible to receive any benefits under Section 6.10
and shall forfeit his Progress RRP benefit.

(b)           Notwithstanding any other provision of the Plan, no Progress RRP
benefit shall be payable under Section 6.10 with respect to a Progress RRP
Participant whose employment with the Affiliated Group is terminated for Cause. 
As used herein, the term "Cause" shall be limited to (a) action involving
willful malfeasance having a material adverse effect on a member of the
Affiliated Group, (b) substantial and continuing willful refusal to perform the
duties ordinarily performed by an employee in the same position and having
similar duties, (c) being convicted of a felony, or (d) willful failure to
comply with an applicable Code of Conduct or other Policy or Procedure of a
member of the Affiliated Group.

Each Cinergy Excess Plan Participant who participated in the Cinergy Corp.
Executive Life Insurance Program and was an employee of the Company on December
31, 2008 and thereby became entitled to a Supplemental Credit to his
Supplemental Account shall come vested in such Supplemental Credit to his
Supplemental Account only if he attains age 50 and has at least five years of
service under the Retirement Cash Balance Plan prior to his Separation from
Service.  If a Cinergy Excess Plan Participant's employment with the Company
terminates and he is not fully vested, the unvested portion of his benefit shall
be immediately forfeited and no benefit under the Plan shall be paid with
respect thereto.

5.2           Prior Supplemental Credits.  Notwithstanding the foregoing, any
one-time Supplemental Credit to a Participant’s Supplemental Account that is
made in recognition of the December 31, 1998 discontinuance of supplemental pay
credit, and any Interest Credits thereon, shall not vest, and shall be forfeited
if the Participant’s employment with the Company terminates before January 1,
2004, unless such employment termination is on account of the Participant’s
retirement under the Retirement Cash Balance Plan, death, or the Participant
having become “Disabled,” as defined in the Retirement Cash Balance Plan, or
unless such employment termination is by the Company other than for “cause”. The
Company shall have “cause” to terminate the Participant’s employment upon (a)
the willful and continued failure by the Participant to substantially perform
his employment duties (other than any such failure resulting from the
Participant’s incapacity due to physical or mental illness) after demand for
substantial performance is delivered by the Company, specifically identifying
the manner in which the Company believes the Participant has not substantially
performed his duties, or (b) the willful engaging by the Participant in
misconduct which is materially injurious to the Company, monetarily or
otherwise. For purposes of this Section, no act, or failure to act, on the
Participant’s part shall be considered “willful” unless done, or omitted to be
done, by him not in good faith and without reasonable belief that his action or
omission was in the best interest of the Company.

5.3           Change in Control.  In the event of a Change in Control, all
Participant accounts under the Plan shall become fully and immediately vested
and non-forfeitable and shall thereafter be maintained and paid in accordance
with the terms of this Plan.

ARTICLE VI
PAYMENT OF BENEFITS

6.1(a)      Timing of Payments Under Part I.   Except as provided in Section
6.11, for purposes of Part I of the Plan, a Participant whose Company employment
terminates prior to the Participant’s earliest retirement age under the
Retirement Cash Balance Plan will receive, or will begin to receive, payment of
his vested Make-Whole Account and his vested Supplemental Account, if any, as
soon as administratively feasible following the month in which the Participant
attains age 55.  A Participant whose Company employment terminates after the
Participant’s earliest retirement age under the Retirement Cash Balance Plan
will receive, or will begin to receive, payment of his vested Make-Whole Account
and his vested Supplemental Account, if any, as soon as administratively
feasible following the month in which the Participant’s employment terminates. 
Any other Participant whose Company employment terminates and whose Make-Whole
Account and Supplemental Account, if any, have a combined balance, as of the
last day of the month during which employment terminated, of less than $25,000,
will receive payment of his vested Make-Whole Account and his vested
Supplemental Account, if any, in a single sum, as soon as administratively
feasible following the month in which the Participant’s employment with the
Company terminates.

 

--------------------------------------------------------------------------------

 

 

6.1(b)      Timing of Payments Under Part II.   Except as otherwise provided in
Sections 6.9, 6.10, and 6.11, for purposes of Part II of the Plan, and subject
to Section 6.5, each Participant will receive, or will begin to receive, payment
of his vested Make-Whole Account and his vested Supplemental Account, if any,
within 60 days after Separation from Service.

6.2(a)(1)  Election of Form of Benefit Under Part I.  Except as otherwise
provided in Section 6.11, with respect to Part I of the Plan, each Participant
has been provided the opportunity to elect from among the forms of benefit
payment specified in Section 6.2(b)(1) the manner in which such Participant’s
vested Make-Whole Account and his vested Supplemental Account, if any, shall be
paid. A Participant may change his form of benefit payment election under Part I
of the Plan at any time, and from time to time, by completing such form as the
Committee provides and filing the completed form with the Committee. No such
change shall become effective unless and until the Participant has continued in
employment with the Company for at least one year from the date on which the
Committee receives notification of the change.

6.2(a)(2)  Election of Form of Benefit Under Part II.   With respect to Part II
of the Plan, no later than December 31, 2008 (or such earlier date set by the
Committee), each Participant elected from among the forms of benefit payment
specified in Section 6.2(b)(2) the manner in which such Participant’s vested
Make-Whole Account and his vested Supplemental Account, if any, shall be paid.
The election described in this Section 6.2(a)(2) was subject to such terms and
conditions as the Committee specified in its sole discretion and consistent with
the terms of Notice 2007-86 and the applicable proposed and final Treasury
Regulations issued under Section 409A of the Code.  To the extent that a
Participant did not designate the manner in which such Participant’s vested
Make-Whole Account and his vested Supplemental Account, if any, shall be paid as
provided in this Section 6.2(a)(2) (or such designation does not comply with the
terms of Part II of the Plan), such accounts shall be paid in a single lump sum.
Notwithstanding anything contained in the Plan to the contrary, except Section
6.2(d) or Sections 6.9, 6.10, and 6.11, or any other plan, policy, practice or
program, contract or agreement with the Company or the Affiliated Group (unless
otherwise specifically provided therein in a specific reference to this Plan), a
Participant who becomes eligible to participate in the Plan (including the
Cinergy Excess Plan as defined in Section 6.11) after December 31, 2008 shall
have no right to choose a form of payment for his accounts, and, instead, his
vested Make-Whole Account and his vested Supplemental Account, if any, shall be
paid in a single lump sum.

6.2(b)(1)  Forms of Benefit Under Part I.   Except as otherwise provided in
Section 6.11, the forms of benefit payment available under Part I of the Plan
are:

(A)         single lump sum payment; 
(B)         monthly payments for three years; 
(C)         monthly payments for ten years; and 
(D)         monthly payments for fifteen years. 

At such time as benefits under the Plan become payable with respect to a
Participant, such benefits shall be paid in accordance with the benefit payment
form then in effect unless otherwise expressly provided by the Plan.

6.2(b)(2)  Forms of Benefit Under Part II.   Except as otherwise provided in
Sections 6.9, 6.10, and 6.11, the forms of benefit payment available under Part
II of the Plan are:

(A)         single lump sum payment; 
(B)         monthly payments for two to ten years; and 
(C)         monthly payments for fifteen years. 

At such time as benefits under the Plan become payable with respect to a
Participant, such benefits shall be paid in accordance with the benefit payment
form then in effect unless otherwise expressly provided by the Plan.

6.2(c)      Calculation of Installment Payments.  In the event of monthly
installment payments, the amount of the payment for a particular month shall be
calculated as follows:

Monthly amount

=

V
N

where

 

 

N

 

represents the number of months remaining in the payment term and

V

 

represents the sum of the balance of the Participant’s Make-Whole Account and
the balance of the Participant’s Supplemental Account, if any, determined as of
the end of the prior month after adding any Pay Credits, Supplemental Credits
and Interest Credits for the prior month and subtracting any payment or
forfeiture for the prior month.

6.2(d)      Forms of Benefit – Supplemental Account.  Notwithstanding any other
provision of the Plan, prior to making a Supplemental Credit (including a
Supplemental Credit under Section 6.11), the Committee may provide that the
portion of the Participant’s vested Supplemental Account that is attributable to
such Supplemental Credit shall be distributed in any benefit payment form
specified in advance by the Committee.

6.3           Payments in Cash.  Any benefit payment due under the Plan shall be
paid in cash.

6.4           Financial Hardship.  Upon written request by a Participant, the
Committee may distribute to a Participant who is receiving a monthly payment
form of distribution, such amount of the remaining balance of the Participant’s
vested Make-Whole Account and vested Supplemental Account, if any, which the
Committee determines is necessary to provide for a financial hardship suffered
by the Participant. For purposes of Part I of the Plan, the term “financial
hardship” shall mean a severe financial hardship as determined under federal
income tax law, regulations and rulings which are applicable to non-qualified
deferred compensation plans. For purposes of Part II of the Plan, the term
“financial hardship” shall mean an “unforeseeable

 

--------------------------------------------------------------------------------

 

 

emergency” as defined under Section 409A of the Code. Payment shall be made
within 60 days following the determination that a withdrawal shall be permitted
under this Section, or such later date as may be required under Section 6.5.

6.5           Mandatory Six-Month Delay Under Part II.  Except as otherwise
provided in Sections 6.6(a) and (b), and to the extent required under Section
409A of the Code, with respect to any Participant who is a Specified Employee as
of his Separation from Service, except as provided below, the payment of
benefits from Part II of the Plan that are otherwise payable pursuant to the
Participant’s Separation from Service shall commence within 60 days after the
first business day of the seventh month following such Separation from Service
(or if earlier, upon the Participant’s death).  All annuity amounts that would
otherwise be paid under Sections 6.9 or 6.10 during the first six months
following the Separation for Service shall instead be accumulated through and
paid on the first business day of the seventh month following the Separation
from Service.  All annuity payments payable under Part II as described in
Section 6.11 that are otherwise payable pursuant to, and during the six-month
period commencing upon, a Cinergy Excess Plan Participant’s Separation from
Service, shall be accumulated (along with interest determined utilizing the
Interest Factor) and shall be paid within 60 days after the first business day
of the seventh month following such Separation from Service (or if earlier, upon
the Cinergy Excess Plan Participant's death).  If the Progress Nonqualified Plan
Participant under Section 6.9 or the Progress RRP Participant under Section 6.10
dies following Separation from Service but prior to the commencement of
payments, then, (i) in the case of benefits payable pursuant to Section 6.9(b)
or 6.10, the Participant’s surviving Eligible Spouse, if any, or Beneficiary, if
applicable, shall be entitled to receive the same death benefit as if the
Participant had commenced receiving benefit payments as of the first day of the
month prior to his death, and (ii) in the case of benefits payable pursuant to
Section 6.9(c), the Progress Nonqualified Plan Participant’s surviving Eligible
Spouse, if any, shall be eligible for the surviving spouse benefit set forth
therein.

6.6           Discretionary Acceleration of Payment.  The Committee may, in its
sole discretion, accelerate the time or schedule of a payment under Part II of
the Plan to a time or form otherwise permitted under Section 409A of the Code in
accordance with the requirements, restrictions and limitations of Treasury
Regulation Section 1.409A-3(j) (e.g., relating to domestic relations orders,
employment taxes, conflict of interests, income inclusion under Section 409A of
the Code, state, local or foreign taxes, offsets, bona fide disputes and small
accounts); provided that in no event may a payment be accelerated following a
Specified Employee's Separation from Service to a date that is prior to the
first business day of the seventh month following this Participant's Separation
from Service (or if earlier, upon the Participant's death) unless specifically
permitted under Section 409A of the Code) (e.g., relating to domestic relations
orders, employment taxes and conflict of interests).  Except as otherwise
specifically provided in Part II of this Plan, the Committee may not accelerate
the time or schedule of any payment or amount scheduled to be paid under the
Plan within the meaning of Section 409A of the Code.

6.7           Discretionary Delay of Payments.  The Committee may, in its sole
discretion, delay the time or form of payment under Part II of the Plan to a
time or form otherwise permitted under Section 409A of the Code in accordance
with the requirements, restrictions and limitations of Treasury Regulation
Section 1.409A-2(b)(7) (e.g.,  relating to compliance with Section 162(m) of the
Code, federal securities laws or other applicable laws); provided that the
Committee treats all payments to similarly situated Participants on a reasonably
consistent basis.

6.8           Actual Date of Payment.  If calculation of the amount of the
payment under Part II of the Plan is not administratively practicable due to
events beyond the control of the Participant (or Beneficiary), the payment will
be treated as made upon the date specified under Part II of the Plan if the
payment is made during the first calendar year in which the calculation of the
amount of the payment is administratively practicable. Notwithstanding the
foregoing, payment must be made no later than the latest possible date permitted
under Section 409A of the Code. Moreover, notwithstanding any other provision of
this Plan to the contrary except Section 6.5, and to the extent permitted by
Section 409A of the Code, a payment will be treated as made upon the date
specified under Part II of the Plan if the payment is made as close as
administratively practicable to the relevant payment date specified herein, and
in any event within the same calendar year.

6.9           Progress Nonqualified Plan Participants.  Notwithstanding anything
contained in this Plan to the contrary, the amount of benefit and payment terms
for a Progress Nonqualified Plan Participant shall be determined in accordance
with the provisions of this Section 6.9. For purposes of clarity, (i) this
Section 6.9 reflects the obligations and rights assumed from the Progress
Nonqualified Plan with respect to the Progress Nonqualified Plan Participants
and (ii) the Progress Nonqualified Plan Participants shall have no further
rights under the Progress Nonqualified Plan.

(a)           Calculation of Progress Nonqualified Plan Participant Benefit.  A
Progress Nonqualified Plan Participant’s benefit from the Plan shall equal the
greater of (i) or (ii), where (i) and (ii) are as follows:

(i)            The amount in this Section 6.9(a)(i) is the sum of the Frozen
Progress Nonqualified Plan Benefit (as defined in Exhibit A) and ECBP Benefit
for Progress Nonqualified Plan Participant (as defined in Exhibit A). 

(ii)           The amount in this Section 6.9(a)(ii) is the Minimum Progress
Nonqualified Plan Benefit (as defined in Exhibit A). 

(b)           General Payment Terms.  Except as otherwise provided in Sections
6.9(c), (d) or (e), the Progress Nonqualified Plan Participant’s benefit shall
be paid in the form of (i) if the Progress Nonqualified Plan Participant does
not have an Eligible Spouse on the date payments under this Plan commence, a
Single Life Annuity, commencing within 60 days after the first day of the
calendar month next following the Progress Nonqualified Plan Participant’s
Separation from Service, and ending with a payment for the month in which the
Progress Nonqualified Plan Participant’s death occurs; provided that the monthly
installments shall be guaranteed for 120 monthly payments with any such
guaranteed payments remaining at such Progress Nonqualified Plan Participant’s
death payable to his Beneficiary or, (ii) if the Progress Nonqualified Plan
Participant has an Eligible Spouse on the date payments under this Plan
commence, then a 50% Qualified Joint and Survivor Annuity for the life of the
Progress Nonqualified Plan Participant, and after the Progress Nonqualified Plan
Participant’s death, for the life of the surviving Eligible Spouse, if any.

(c)           Deferred Vested Benefits.  If a Progress Nonqualified Plan
Participant incurs a Separation from Service after completing 10 or more years
of Service and before being eligible for a normal or early retirement benefit
under Paragraph 1 or 2 of Exhibit A, then except as provided in Section 6.9(e),
the Progress Nonqualified Plan Participant’s benefit under Section 6.9(a) shall
be paid in monthly installments, commencing on the first day of the calendar
month coinciding with or next following the Progress Nonqualified Plan
Participant’s 65th birthday and ending with a payment for the month in which the
Progress Nonqualified Plan Participant’s death occurs; provided that, if the
Progress Nonqualified Plan Participant is receiving, or dies after attaining age
55 while entitled to receive, the deferred vested benefit, then the Progress
Nonqualified Plan Participant’s Eligible Spouse (if any) shall be entitled to an
amount equal to 50% of the deferred vested benefit the deceased Progress
Nonqualified Plan Participant was receiving immediately prior to his death (or
would have been entitled to receive if the Progress Nonqualified Plan
Participant had survived until his 65th birthday), which amount shall be payable
to the Eligible Spouse in monthly installments commencing in the month following
the Progress Nonqualified Plan Participant’s death and ending with a payment for
the month in which the Eligible Spouse’s death occurs.

 

--------------------------------------------------------------------------------

 

 

(d)           Pre-Retirement Death Benefits.  If a Progress Nonqualified Plan
Participant dies while in the employ of the Company after completing 10 or more
years of Service, the Progress Nonqualified Plan Participant’s Eligible Spouse
shall be eligible for an annuity in an amount equal to the standard benefit or,
if greater, alternative benefit (as specified below) commencing, except as
provided in Section 6.5, in the month following the Progress Nonqualified Plan
Participant’s death and shall continue thereafter ending with a payment for the
month in which the Eligible Spouse’s death occurs. The standard benefit shall be
an amount equal to the greater of (i) or (ii), where

(i)            is the sum of (A) and (B), where (A) is the excess, if any, of
(I) forty percent (40%) of the Target Pre-Retirement Death Benefit (as defined
in Exhibit A) over (II) the Spouse’s Pension (as defined in Exhibit A), each
determined as if the Progress Nonqualified Plan Participant died as of July 2,
2012, and (B) the benefit under Section 7.1 with the Eligible Spouse as
Beneficiary (i.e., the sum of the balance in the Progress Nonqualified Plan
Participant’s Make-Whole Benefit Account and Supplemental Benefit Account)
determined as of the Progress Nonqualified Plan Participant’s actual date of
death, actuarially adjusted using the actuarial assumptions specified in the
definition of ECBP Benefit for Progress Nonqualified Plan Participant in
Paragraph 4 of Exhibit A to an annuity payable for the life of the Eligible
Spouse, and 

(ii)           is the excess, if any between (I) forty percent (40%) of the
Target Pre-Retirement Death Benefit (as defined in Exhibit A) over (II) the
Spouse’s Pension (as defined in Exhibit A), each determined as of the Progress
Nonqualified Plan Participant’s actual date of death. 

The alternative benefit shall be available to a surviving Eligible Spouse of the
Progress Nonqualified Plan Participant who dies while in the employ of the
Company after attaining age 55 with 15 years of Service and shall be equal to
50% of the benefit the Progress Nonqualified Plan Participant would have been
entitled to receive under Section 6.9(a) calculated as if the Progress
Nonqualified Plan Participant had a Separation from Service immediately prior to
his death.

(e)           Definitions.  See Article II and Exhibit A.

6.10         Progress RRP Participants.  Notwithstanding anything contained in
this Plan to the contrary, the amount of benefit and payment terms for a
Progress RRP Participant with respect to the Progress RRP benefit shall be
determined in accordance with the provisions of this Section 6.10.  The benefit
of a Progress RRP Participant under the Plan shall consist of the sum of (a) the
Progress RRP benefit under this Section 6.10 and (b) the Make-Whole Benefit
under Section 4.1 for periods on and after January 1, 2014.  For purposes of
clarity, (i) this Section 6.10 reflects the obligations and rights assumed from
the Progress RRP with respect to the Progress RRP Participants and (ii) the
Progress RRP Participants shall have no further rights under the Progress RRP.

(a)           Calculation of Progress RRP Benefit.  A Progress RRP Participant’s
benefit under this Section 6.10 shall mean, as of any determination date, the
excess of (i) a Participant's accrued benefit calculated under the Progress
Qualified Retirement Plan as of December 31, 2013 (A) assuming a Participant's
compensation under the Progress Qualified Retirement Plan includes Deferrals of
a Participant and (B) without regard to the Compensation and Benefit
Limitations, over (ii) a Participant's accrued benefit calculated under the
Progress Qualified Retirement Plan as of December 31, 2013.  For this purpose, a
Participant's accrued benefit shall be calculated in the form of a single life
annuity for a Participant who does not have a Spouse and in the form of a 50%
qualified joint and survivor annuity for a Participant who has a Spouse, with
such calculation performed without regard to any other form of benefit elected
by a Participant under the Progress Qualified Retirement Plan.  The Progress RRP
benefit is determined for non-bargaining employees of Progress Energy Florida,
Inc. and corporate employees of Progress Fuels Corporation solely with respect
to employment on or after January 1, 2002 through December 31, 2013.

(b)           General Payment Terms.  Subject to the forfeiture provisions of
Section 5.1, lump sum payment provisions of Section 6.10(d), and Section 6.5, a
Participant who becomes eligible for the payment of a Progress RRP benefit shall
be entitled to monthly benefit payments commencing within sixty days after
Separation from Service.  The monthly payment shall be in the form of a single
life annuity if the Participant has no Spouse and in the form of a 50% joint and
survivor annuity if the Participant has a Spouse, with the Spouse (determined at
the Separation from Service) entitled to any survivor benefit upon the death of
the Participant.

(c)           Pre-Retirement Death Benefit.  Subject to the provisions of
Section 6.10(d), if a surviving Spouse of a deceased Participant is eligible for
a pre-retirement death benefit or death benefit under the Progress Qualified
Retirement Plan, then upon such Participant's death, such Spouse shall be
entitled to a monthly benefit payment under the Plan equal to the amount, if
any, by which (i) exceeds (ii) each month, where (i) is the Spouse's monthly
death benefit that would be payable in accordance with the provisions of the
Progress Qualified Retirement Plan with respect to the Participant's accrued
benefit calculated under the Progress Qualified Retirement Plan as of December
31, 2013 as if (A) the Participant's Compensation under the Progress Qualified
Retirement Plan included Deferrals and (B) the Compensation and Benefit
Limitations did not apply, and (ii) is the monthly death benefit payable under
the Progress Qualified Retirement Plan with respect to the Participant's accrued
benefit calculated under the Progress Qualified Retirement Plan as of December
31, 2013, and assuming for purposes of clauses (i) and (ii) that the Spouse
elected  a monthly annuity as a death benefit under the Progress Qualified
Retirement Plan commencing on the same date as the preretirement death benefit
is payable to the Spouse under this Section 6.10(c).  The pre-retirement death
benefit under this Plan shall commence within sixty days of the first day of the
month following the Participant's death, and shall continue on the first day of
each month thereafter for the life of the Spouse.

(d)           Lump Sum Payments.  The Committee shall provide for the payment
under the Plan of a cash lump sum amount in lieu of the annuity otherwise
payable under Sections 6.10(b) or (c), if the annuity amount to be paid is less
than $500 per month.  For a Participant (or spouse) whose benefit under the
Progress Qualified Retirement Plan is based upon the Participant's cash balance
account, the lump sum shall be equal to what the Progress RRP benefit would be
if "Cash Balance Account" were substituted for "accrued benefit" in
Section 6.10(a) and the Progress RRP benefit referred to a lump sum dollar
amount.  For a Participant (or Spouse) whose benefit under the Progress
Qualified Retirement Plan is based on the final average pay formula pension, the
lump sum shall be equal to the Actuarial Value of the annuity payments that
would otherwise be made to the Participant (or Spouse) under Sections 6.10(b) or
(c), as the case may be.  Notwithstanding the foregoing, no lump sum payment
shall be made under this Section 6.10(d) unless (i) the payment accompanies the
termination of the entirety of the Participant's interest under this Section
6.10; (ii) the payment is made on or before the later of (A) December 31 of the
calendar year in which the Termination of the Participant occurs, or (B) the
date that is 2 1/2 months after the Separation from Service; and (iii) the
payment is not greater than $75,000.

(e)           Definitions.  For purposes of this Section 6.10:

 

--------------------------------------------------------------------------------

 

 

(i)            “Actuarial Value” shall mean the applicable mortality table as in
effect from time to time as defined in Section 417(e) of the Code and the
applicable interest rate as defined in Section 417(e) of the Code for the month
of August prior to the beginning of the Plan Year during which the Separation
from Service (or date of death) occurs.

(ii)           "Compensation and Benefit Limitations" shall mean (a) the
limitation on compensation under Section 401(a)(17) of the Code and (b) any
limits on benefits that are necessary for compliance with Section 415 of the
Code.

(iii)          "Deferrals" shall mean a Participant's deferrals of compensation
under the Progress Energy, Inc. Amended and Restated Management Deferred
Compensation Plan or Duke Energy Corporation Executive Savings Plan or any
successor plan to the extent not utilized in calculating a Participant's accrued
benefit under the Progress Qualified Retirement Plan.

(iv)          “Progress Qualified Retirement Plan” shall have the meaning
provided in Exhibit A.

(v)           "Spouse" shall mean the spouse of a Participant as would be
determined at the applicable time under the definition of Spouse in the Progress
Qualified Retirement Plan (or any successor provisions).

6.11         Cinergy Excess Plan Participants.  Notwithstanding anything
contained in this Plan to the contrary, the amount of benefit and payment terms
for a Cinergy Excess Plan Participant shall be determined in accordance with the
provisions of this Section 6.11.  The benefit of a Cinergy Excess Plan
Participant under the Plan shall consist of (a) the Cinergy Excess Plan benefit
under this Section 6.11 and (b) the Make-Whole Benefit and Supplemental Account
benefit under Sections 4.1 and 4.3, if any.  For purposes of clarity, (i) this
Section 6.11 reflects the obligations and rights assumed from the Cinergy Excess
Plan with respect to the Cinergy Excess Plan Participants and (ii) the Cinergy
Excess Plan Participants shall have no further rights under the Cinergy Excess
Plan.

(a)           Calculation of Cinergy Excess Plan Benefit.  A Cinergy Excess Plan
Participant’s benefit shall, as applicable, include the following:

(i)            Cinergy Excess Plan Part I Benefit.  For a Cinergy Excess Plan
Participant who is eligible for a Cinergy Excess Plan Part I benefit, the
benefit shall be determined under the Cinergy Excess Plan as in effect prior to
January 1, 2005, except that (i) the update to actuarial factors to reflect more
recent mortality and interest rate experience as provided in paragraphs (a) and
(b) of Section 2 of the Sixth Amendment to the Cinergy Corp.  Non-Union
Employees’ Pension Plan (the “Cinergy Non-Union Plan”) shall apply and (ii) a
3.8% interest crediting floor under the investor and cash balance programs shall
apply.

(ii)           Traditional Program Benefit.  A Cinergy Excess Plan Participant
who had participated in the traditional (final average pay) program of the
Cinergy Non-Union Pension, but not the cash balance program of the Cinergy
Non-Union Plan or Retirement Cash Balance Plan shall be entitled to a monthly
benefit as provided by the Cinergy Excess Pension Plan as in effect prior to
December 31, 2013.

(iii)          Part A Choice Benefit.  A Cinergy Excess Plan Participant who is
treated as a “choice participant” under the Retirement Cash Balance Plan (e.g.,
he elected to start participating in the cash balance program effective on April
1, 2007) shall be entitled to a monthly benefit with respect to the eligible
Cinergy Excess Plan Participant’s Part A benefit under the Retirement Cash
Balance Plan that is equal to the excess, if any, of his Unrestricted Benefit
over his Maximum Benefit, as defined below, determined as of the date this
Cinergy Excess Plan benefit is to commence:

(A)           "Maximum Benefit" means, for this purpose, the monthly equivalent
of the Part A benefit to which the Cinergy Excess Plan Participant is entitled
under the Retirement Cash Balance Plan after applying Sections 401(a)(17) and
415 of the Code.

(B)           "Unrestricted Benefit" means, for this purpose, the monthly
equivalent of the Part A benefit to which the Cinergy Excess Plan Participant
would be entitled under the Retirement Cash Balance Plan, if that benefit had
been determined without regard to the limitations imposed on qualified
retirement plan benefits under Sections 401(a)(17) and 415 of the Code.

(iv)          Part A Automatic Benefit.  A Cinergy Excess Plan Participant who
is treated as an “automatic conversion participant” under the Retirement Cash
Balance Plan (i.e., he was automatically converted to the cash balance program
effective on January 1, 2011) shall be eligible for a Part A automatic benefit
determined in the same manner as the Part A choice benefit described above, but
only with respect to the eligible Cinergy Excess Plan Participant’s Part A
automatic benefit under the Retirement Cash Balance Plan.

(v)           Cinergy Transition Benefit.  For those Cinergy Excess Plan
Participants who were hired prior to 2003 and elected to move from the
traditional program to the investor program or balanced program (as defined in
the Cinergy Non-Union Plan) on January 1, 2003 (or later applicable rehire or
transfer date), the Retirement Cash Balance Plan provides that the annual
pension shall be no less than the sum of the Cinergy Excess Plan Participant's
prior conversion pension and the annual pension if the Cinergy Excess Plan
Participant had no accrued benefit other than his cash balance account and had
no amount credited to the cash balance account as an opening balance.  If, upon
Separation from Service, the rule described in the immediately preceding
sentence is applicable to the Cinergy Excess Plan Participant, determined as if
the Cinergy Excess Plan Participant elected to receive his Cinergy Excess Plan
benefit in the form of a single life annuity upon his Separation from Service,
the Cinergy Excess Plan Participant shall receive upon his Separation from
Service, the actuarial equivalent (as defined in the Retirement Cash Balance
Plan) present value (i.e., single lump sum) of the additional benefit (if any)
that would have been provided through this rule, had the Cinergy Excess Plan
benefit under this rule been determined without regard to the limitations
imposed by Sections 401(a)(17) or 415 of the Code, which single lump sum shall
be paid within 60 days after his Separation from Service, or such later date
required by Section 6.5.

(vi)          Special Rule for Payments Under the Commercial Unit Annual Plan. 
Effective with respect to amounts received on or after January 1, 2004, under
the Energy Merchant Business Unit Annual Incentive Plan, which is also known as
the Cinergy Corp. Commercial Business Unit Annual Incentive Plan, Duke Energy
Generation Services Annual Short-Term Incentive Discretionary Pool Plan,
Commercial Asset Management Discretionary Pool Plan, Regulated Portfolio
Optimization & Fuels Discretionary Incentive Pool Plan, and Wholesale
Origination and Structuring Discretionary Incentive Pool Plan, or any successor
plan (collectively a "Commercial Unit Plan"), the amount of the cash award taken
into account for a Plan Year shall not exceed the Cinergy Excess Plan
Participant's rate of annual base salary or base wage, as applicable, as of the
last day of the performance period for which the award is calculated.  For
purposes of clarity, any amount payable under the Commercial Unit Plan or any
other annual incentive plan maintained by the Commercial Business Unit that is
automatically deferred until a subsequent Plan Year shall not be considered as
part of the Cinergy Excess Plan Participant's annual performance cash award.

--------------------------------------------------------------------------------

 

(vii)         Mid-Career Benefit.  The one individual (the “Legacy Mid-Career
Participant”) who, as of December 31, 2008, was an employee of Cinergy Corp.,
participated in the Cinergy Corp. Supplemental Executive Retirement Plan and had
not commenced payment thereunder, shall be eligible for a Cinergy Excess Plan
Mid-Career Benefit calculated in the same manner as such benefit would have been
calculated under the Mid-Career Benefit of the Cinergy Corp. Supplemental
Executive Retirement Plan as in effect immediately prior December 31, 2008.

(b)  Payment of Cinergy Excess Plan Benefit.  A Cinergy Excess Plan
Participant’s benefit shall be paid as follows:

(i)            Timing of Payments. 

(A)           Part I.  For purposes of Cinergy Excess Plan Part I, the payment
of a Cinergy Excess Plan Participant's benefit will begin as of the same date
his traditional program or Part A benefits under the Retirement Cash Balance
Plan begin.  Notwithstanding the foregoing, where the actuarial equivalent
present value of a Cinergy Excess Plan Participant's Part I benefit payable does
not exceed $5,000, the Committee or its designee shall pay the actuarial
equivalent of the benefit in a single lump sum.

(B)           Part II.  For purposes of Cinergy Excess Plan Part II, and subject
to Section 6.5, a Cinergy Excess Plan Participant who incurs a Separation from
Service on or after December 31, 2008 will receive, or will begin to receive,
payment of his Cinergy Excess Plan Make-Whole Account, Supplemental Account,
vested traditional program benefit, Part A choice benefit, Part A automatic
benefit, and Cinergy transition benefit, if and as applicable, within 60 days
following the commencement date elected by the Cinergy Excess Plan Participant
prior to 2009, and if the Cinergy Excess Plan Participant was not provided with
the opportunity to make such an election or did not effectively make such an
election, in accordance with the default timing rules provided under the Cinergy
Excess Plan in effect prior to December 31, 2013.

(ii)           Election of Form of Benefit.  At such time as Cinergy Excess Plan
benefits become payable with respect to a Cinergy Excess Plan Participant, such
Cinergy Excess Plan benefits shall be paid in accordance with the benefit
payment form then in effect unless otherwise expressly provided by the Plan.

(A)           Part I.  For purposes of Cinergy Excess Plan Part I, the payment
of a Cinergy Excess Plan Participant's benefit will be paid in the same form in
which the Cinergy Excess Plan Participant elects to receive his pension under
the Retirement Cash Balance Plan.

(B)           Part II.   

(I)            Participant Elections.  With respect to Cinergy Excess Plan Part
II, no later than December 31, 2008 (or such earlier date set by the Committee),
each Employee who was then a Cinergy Excess Plan Participant was provided an
election from among the available forms of benefit regarding the manner in which
such Cinergy Excess Plan Participant's vested traditional program benefit, Part
A choice benefit, Make-Whole Account, and Supplemental Account (but only if such
Cinergy Excess Plan Participant then-participated in the cash balance program),
if and as applicable, shall be paid.  This election was subject to such terms
and conditions as the Committee specified in its sole discretion, consistent
with the terms of Notice 2007-86 and the applicable proposed and final Treasury
Regulations issued under Section 409A of the Code.

(II)           Default Rules. 

(a)           General.  To the extent that a Cinergy Excess Plan Participant was
not provided with the opportunity to make an election or did not effectively
make such an election before 2009, his Cinergy Excess Plan vested traditional
program benefit, Part A choice benefit, Make-Whole Account and Supplemental
Account, if and as applicable, shall be paid in accordance with default rules
provided under the Cinergy Excess Plan in effect prior to December 31, 2013.

(b)           Supplemental Account.  For purposes of clarity, each Cinergy
Excess Plan Participant’s Supplemental Account, if any, shall be paid:  (A) in
the same form as his Make-Whole Account, if any, and (B) in the form of a single
lump sum if he does not have a Make-Whole Account.

(III)          Benefits that Commence Prior to 2009.  Cinergy Excess Plan
benefits that commenced to be paid to a Cinergy Excess Plan Participant prior to
2009 shall continue to be paid after 2008, in accordance with the form of
benefit elected, until fully paid out.  If a Cinergy Excess Plan Participant had
a Separation from Service prior to 2009 and elected to commence the payment of
his benefit under the Cinergy Non-Union Plan prior to 2009, such election shall
govern the payment of his Cinergy Excess Plan benefit, which shall be paid at
the same time and in the same form as his benefit under the Cinergy Non-Union
Plan.

(iii)          Available Forms of Benefit – Part II.  Except as otherwise
provided under the Cinergy Excess Plan in effect prior to December 31, 2013, the
following forms of benefit are available under Part II. 

(A)           Make-Whole Account and Supplemental Account.  With respect to each
Cinergy Excess Plan Participant who is provided with an election, the forms of
benefit in Section 6.2(b)(2) are available for the Cinergy Excess Plan
Participant’s Make-Whole Account and Supplemental Account.

(B)           Traditional Program.  With respect to each Cinergy Excess Plan
Participant who is provided with an election, the following forms of benefit are
available for the Cinergy Excess Plan Participant’s traditional program benefit,
each of which shall be determined pursuant to the payment provisions of the
Retirement Cash Balance Plan:  single life annuity, 100% contingent annuitant
option, 66-2/3% contingent annuitant option, 50% contingent annuitant option,
and ten-year certain and life option.

(C)           Part A Choice Benefit or Part A Non-Choice Benefit.  With respect
to each Cinergy Excess Plan Participant who is provided with an election, the
same forms of benefit are available for the Cinergy Excess Plan Participant’s
Part A Benefit as are described for the traditional program, except as described
below.

(I)            If the Cinergy Excess Plan Participant becomes entitled to a Part
A choice benefit after 2007 or Part A automatic benefit, his Part A choice
benefit or Part A automatic benefit will be payable only in the form of a single
lump sum.

 

--------------------------------------------------------------------------------

 

 

(II)           If the Cinergy Excess Plan Participant commences the payment of
his Part A choice benefit prior to his attainment of age 50, he shall not be
entitled to receive his Part A choice benefit in the form of a 66-2/3%
Contingent Annuitant Option or a Ten-Year Certain and Life Option.

(iv)          Legacy Mid-Career Participant.  Subject to provisions of Section
6.11(b) and (c), the Legacy Mid-Career Participant’s entire benefit shall be
paid in the form of an annuity, from among the payment options selected by the
Legacy Mid-Career Participant, which options shall be the same as those
available for a Cinergy Excess Plan traditional program benefit.  Payment of the
Legacy Mid-Career Participant’s benefit shall commence as of the first day of
the month following the Legacy Mid-Career Participant’s Separation from Service
or such later date required by Section 6.5.  In the event that the Legacy
Mid-Career Participant dies prior to the commencement of the payment of his
benefit, such benefit shall be paid to his spouse, if any, as if such benefit
were a Cinergy Excess Plan traditional program benefit under this Section.

(c)           Death Benefits.  For purposes of Cinergy Excess Plan Part I, death
benefits shall be provided in accordance with the Cinergy Excess Plan in effect
prior to January 1, 2005.  For purposes of Cinergy Excess Plan Part II, the Plan
provides the following death benefits:

(I)            Traditional Program Death Benefit.  Upon the death of a Cinergy
Excess Plan Participant under the traditional program, if his Spouse is entitled
to receive a Spouse's benefit under the Retirement Cash Balance Plan, his Spouse
will be entitled to receive an annual benefit that is equal to the amount the
Cinergy Excess Plan Participant would have received under the Plan.  Any excess
pension benefits payable to a Spouse will be payable in equal monthly
installments, each installment being equal to 1/12th of the annual amount as
determined pursuant to this Section.  If at the date of his death a Cinergy
Excess Plan Participant had reached age 50, the first monthly installment will
be payable to the Cinergy Excess Plan Participant's Spouse on the first day of
the calendar month coincident with or following the date of the Cinergy Excess
Plan Participant's death, if his Spouse is then living.  If at the date of his
death the Cinergy Excess Plan Participant had not reached age 50, the first
monthly installment will be payable to the Cinergy Excess Plan Participant's
Spouse on the first day of the calendar month coincident with or following the
date the Cinergy Excess Plan Participant would have reached age 50, had he
survived until that date if his Spouse is then living.  In either event,
subsequent monthly installments will be payable on the first day of each month
and will cease upon the payment of the installment due on the first day of the
calendar month in which the Spouse dies.  For purposes of this Section, "Spouse"
means, with respect to any Cinergy Excess Plan Participant, the Cinergy Excess
Plan Participant's lawfully married Spouse, if any, on the applicable date.

(II)           Part A Death Benefit.  The Part A choice benefit and Part A
automatic benefit for a Participant's Spouse in the event of the Cinergy Excess
Plan Participant’s death shall be determined in the same manner as the
traditional program death benefit, but only with respect to the Cinergy Excess
Plan Participant's Part A choice benefit or Part A automatic benefit
respectively.

(III)          Make-Whole Account and Supplemental Account Death Benefit.  Upon
a Cinergy Excess Plan Participant's death, any remaining balance of a Cinergy
Excess Plan Participant's vested Make-Whole Account and vested Supplemental
Account shall be paid as provided in Article VII.

ARTICLE VII
DEATH BENEFITS

7.1           Designation of Beneficiary.  Except as otherwise provided in
Sections 6.9, 6.10, and 6.11, upon a Participant’s death, any remaining balance
of a Participant’s vested Make-Whole Account and vested Supplemental Account
shall be paid to the Participant’s Beneficiary as a death benefit. The Committee
will provide each Participant with a form to be completed and filed with the
Committee whereby the Participant may designate a Beneficiary.

7.2           Failure to Designate a Beneficiary.  If the Participant does not
designate a Beneficiary, or if the Beneficiary who is designated should
predecease the Participant, the death benefit for a deceased Participant shall
be paid to the estate of the Participant, as the Participant’s Beneficiary.

7.3           Death Prior to Commencement of Payment.  Except as otherwise
provided in Sections 6.9, 6.10, and 6.11, if a Participant should die while
still employed by the Company or otherwise before payment of any Plan benefits
has commenced, payments of any death benefit shall be made to the Participant’s
Beneficiary in the same benefit payment form elected by the Participant, or
otherwise required, under Section 6.2. Notwithstanding the foregoing, with
respect to Part I of the Plan only: (i) if the Beneficiary is the estate, then
the death benefit shall be paid in a single lump sum, and (ii) if the death
benefit is less than $25,000, the death benefit shall be paid to the
Participant’s Beneficiary in a single lump sum.

7.4           Death After Commencement of Payment.  Except as otherwise provided
in Sections 6.9, 6.10, and 6.11, if a Participant should die after payment of
Plan benefits has commenced, payment of any death benefit will be made to the
Participant’s Beneficiary as a continuation of the benefit payment form that had
been in effect for the Participant. Notwithstanding the foregoing, with respect
to Part I of the Plan only, if the Beneficiary is the estate, then the death
benefit shall be paid in a single lump sum.

7.5           Death Benefit for Certain Participants.  If an Employee who was an
active participant in the Supplemental Security Plan on December 31, 1996,
should die while still employed by the Company, the portion of the death benefit
attributable to the Employee’s Supplemental Account, determined after taking
into account other death benefits attributable to the elimination of the
Supplemental Security Plan, shall not be less than the amount determined by
multiplying two point five (2.5) times the annualized base rate of pay of the
Employee on the date of death.

ARTICLE VIII
AMENDMENT AND TERMINATION

The Committee retains the sole and unilateral right to terminate, amend, modify
or supplement this Plan, in whole or in part, at any time. The Committee may
delegate the right to amend the Plan, subject to any limitations it may impose,
to an officer of the Company. No such action shall adversely affect a
Participant’s right to receive amounts then credited to a Participant’s account
with respect to events occurring prior to the date of such amendment. Moreover,
no such action shall in any way affect a Participant’s accrued benefit or the
right to payment thereof under the provisions of Sections 6.9, 6.10, and 6.11 as
in effect immediately prior to the amendment. With respect to Part II of the
Plan, subject to Section 6.5 hereof, the Committee may, in its sole discretion
to the extent permitted in Section 409A of the Code, provide for the
acceleration of the time or schedule of a payment under the Plan upon the
termination of the Plan. In the event of a Change in Control, the Plan shall
become irrevocable and may not be amended or terminated without the written
consent of each Plan Participant who may be affected in any way by such
amendment or termination either at

 

--------------------------------------------------------------------------------

 

 

the time of such action or at any time thereafter. This restriction in the event
of a Change in Control shall be determined by reference to the date any
amendment or resolution terminating the Plan is actually signed by an authorized
party rather than the date such action purports to be effective.

ARTICLE IX
ADMINISTRATION

9.1           Top Hat Plan.  The Company intends for the Plan to be an unfunded
“top-hat” plan for a select group of management or highly compensated employees
which is exempt from substantially all of the requirements of Title I of ERISA
pursuant to Sections 201(2), 301(a)(3), and 401(a)(1) of ERISA. The Company is
the Plan sponsor under Section 3(16)(B) of ERISA.

9.2           Plan Administrator.  The Committee shall have the authority to
control and manage the operation and administration of the Plan except as
otherwise expressly provided in this Plan document. The Committee may designate
other persons to carry out fiduciary responsibilities under the Plan. The
Committee is the administrator of the Plan within the meaning Section 3(16)(A)
of ERISA. As administrator, the Committee has the authority (without limitation
as to other authority) to delegate its duties to agents and to make rules and
regulations that it believes are necessary or appropriate to carry out the Plan.
The Committee has the discretion (i) to interpret and construe the terms and
provisions of the Plan (including any rules or regulations adopted under the
Plan), (ii) to determine questions of eligibility to participate in the Plan and
(iii) to make factual determinations in connection with any of the foregoing. A
decision of the Committee with respect to any matter pertaining to the Plan
including without limitation the Employees determined to be Participants, the
benefits payable, and the construction or interpretation of any provision
thereof, shall be conclusive and binding upon all interested persons. Benefits
under the Plan shall be paid only if the Committee decides in its discretion
that the applicant is entitled to benefits under the Plan.

 

 

ARTICLE X
CLAIMS PROCEDURE

10.1         Claim.  A person with an interest in the Plan shall have the right
to file a claim for benefits under the Plan and to appeal any denial of a claim
for benefits. Any request or application for a Plan benefit or to clarify the
claimant’s rights to future benefits under the terms of the Plan shall be
considered to be a claim.

10.2         Written Claim.  A claim for benefits will be considered as having
been made when submitted in writing by the claimant (or by such claimant’s
authorized representative) to the Committee. No particular form is required for
the claim, but the written claim must identify the name of the claimant and
describe generally the benefit to which the claimant believes he is entitled.
The claim may be delivered personally during normal business hours or mailed to
the Committee.

10.3         Committee Determination.  The Committee will determine whether, or
to what extent, the claim may be allowed or denied under the terms of the Plan.
If the claim is wholly or partially denied, the claimant shall be so informed by
written notice within 90 days after the day the claim is submitted unless
special circumstances require an extension of time for processing the claim. If
such an extension of time for processing is required, written notice of the
extension shall be furnished to the claimant prior to the termination of the
initial 90-day period. Such extension may not exceed an additional 90 days from
the end of the initial 90-day period. The extension notice shall indicate the
special circumstances requiring an extension of time and the date by which the
Plan expects to render the final decision. If notice of denial of a claim (in
whole or in part) is not furnished within the initial 90-day period after the
claim is submitted (or, if applicable, the extended 90-day period), the claimant
shall consider that his claim has been denied just as if he had received actual
notice of denial.

10.4         Notice of Determination.  The notice informing the claimant that
his claim has been wholly or partially denied shall be written in a manner
calculated to be understood by the claimant and shall include: The specific
reason(s) for the denial.  Specific reference to pertinent Plan provisions on
which the denial is based.  A description of any additional material or
information necessary for the claimant to perfect the claim and an explanation
of why such material or information is necessary.  Appropriate information as to
the steps to be taken if the claimant wishes to submit his claim for review. 

10.5         Appeal.  If the claim is wholly or partially denied, the claimant
(or his authorized representative) may file an appeal of the denied claim with
the Committee requesting that the claim be reviewed. The Committee shall conduct
a full and fair review of each appealed claim and its denial. Unless the
Committee notifies the claimant that due to the nature of the benefit and other
attendant circumstances he is entitled to a greater period of time within which
to submit his request for review of a denied claim, the claimant shall have 60
days after he (or his authorized representative) receives written notice of
denial of his claim within which such request must be submitted to the
Committee.

10.6         Request for Review.  The request for review of a denied claim must
be made in writing. In connection with making such request, the claimant or his
authorized representative may: Review pertinent documents.  Submit issues and
comments in writing. 

10.7         Determination of Appeal.  The decision of the Committee regarding
the appeal shall be promptly given to the claimant in writing and shall normally
be given no later than 60 days following the receipt of the request for review.
However, if special circumstances (for example, if the Committee decides to hold
a hearing on the appeal) require a further extension of time for processing, the
decision shall be rendered as soon as possible, but no later than 120 days after
receipt of the request for review. However, if the Committee holds regularly
scheduled meetings at least quarterly, a decision on review shall be made by no
later than the date of the meeting which immediately follows the Plan’s receipt
of a request for review, unless the request is filed within 30 days preceding
the date of such meeting. In such case, a decision may be made by no later than
the date of the second meeting following the Plan’s receipt of the request for
review. If special circumstances (for example, if the Committee decides to hold
a hearing on the appeal) require a further extension of time for processing, the
decision shall be rendered as soon as possible, but no later than the third
meeting following the Plan’s receipt of the request for review. If special
circumstances require that the decision will be made beyond the initial time for
furnishing the decision, written notice of the extension shall be furnished to
the claimant (or his authorized representative) prior to the commencement of the
extension. The decision on review shall be in writing and shall be furnished to
the claimant or to his authorized representative within the appropriate time for
the decision.

 

--------------------------------------------------------------------------------

 

 

10.8         Hearing.  The Committee may, in its sole discretion, decide to hold
a hearing if it determines that a hearing is necessary or appropriate in order
to make a full and fair review of the appealed claim.

10.9         Decision.  The decision on review shall include specific reasons
for the decision, written in a manner calculated to be understood by the
claimant, as well as specific references to the pertinent Plan provisions on
which the decision is based.

10.10       Exhaustion of Appeals.  A person must exhaust his rights to file a
claim and to request a review of the denial of his claim before bringing any
civil action to recover benefits due to him under the terms of the Plan, to
enforce his rights under the terms of the Plan, or to clarify his rights to
future benefits under the terms of the Plan.

10.11       Committee’s Authority.  The Committee shall exercise its
responsibility and authority under this claims procedure as a fiduciary and, in
such capacity, shall have the discretionary authority and responsibility (1) to
interpret and construe the Plan and any rules or regulations under the Plan, (2)
to determine the eligibility of Employees to participate in the Plan, and the
rights of Participants to receive benefits under the Plan, and (3) to make
factual determinations in connection with any of the foregoing. Benefits under
the Plan shall be paid only if the Committee decides in its discretion that the
applicant is entitled to benefits under the Plan.

10.12       Civil Action.  Any civil action brought with respect to a decision
of the Committee on review shall be brought within one year of the mailing of
the written decision to the claimant.

 

ARTICLE XI
NATURE OF COMPANY’S OBLIGATION

11.1         Nature of Obligation.  The Company’s obligation to the Participant
under this Plan shall be an unfunded and unsecured promise to pay. The rights of
a Participant or Beneficiary under this Plan shall be solely those of an
unsecured general creditor of the Company. The Company shall not be obligated
under any circumstances to set aside or hold assets to fund its financial
obligations under this Plan.

11.2         Financing.  Notwithstanding the foregoing, the Company may, in its
sole discretion establish such accounts, trusts, insurance policies or
arrangements, or any other mechanisms it deems necessary or appropriate to
account for or fund its obligations under the Plan. Any assets which the Company
may set aside, acquire or hold to help cover its financial liabilities under
this Plan are and remain general assets of the Company subject to the claims of
its creditors. The Company does not give, and the Plan does not give, any
beneficial ownership interest in any assets of the Company to a Participant or
Beneficiary. All rights of ownership in any assets are and remain in the
Company. Any general asset used or acquired by the Company in connection with
the liabilities it has assumed under this Plan shall not be deemed to be held
under any trust for the benefit of the Participant or any Beneficiary, and no
general asset shall be considered security for the performance of the
obligations of the Company. Any asset shall remain a general, unpledged, and
unrestricted asset of the Company. The Company’s liability for payment of
benefits shall be determined only under the provisions of this Plan, as it may
be amended from time to time.

Notwithstanding the foregoing, upon a Change in Control, the Company shall
irrevocably set aside funds in one or more grantor trusts, subject to the
provisions of this Section 11.2, in an amount that is sufficient to pay each
Progress RRP Participant (or Spouse) the Progress RRP benefits earned prior to
2014.  Any such trust shall be subject to the claims of the general creditors of
the Company in the event of the bankruptcy of the Company.  The Company shall
establish no such trust if the assets thereof are includable in the income of
Progress RRP Participants thereby pursuant to Section 409A of the Code.

ARTICLE XII
GENERAL PROVISIONS

12.1         No Right to Employment.  Nothing in this Plan shall be deemed to
give any person the right to remain in the employ of the Company or affect the
right of the Company to terminate any Participant’s employment with or without
cause.

12.2         No Assignment.  No right or benefit under the Plan shall be subject
to anticipation, alienation, sale, assignment, pledge, encumbrance or charge.
Any attempt to anticipate, alienate, sell, assign, pledge, encumber or charge
these benefits shall be void. No right or benefit under this Plan shall in any
manner be liable for or subject to the debts, contracts, liabilities, or torts
of the person entitled to the benefit. If any Participant or Beneficiary under
the Plan should become bankrupt or attempt to anticipate, alienate, sell,
assign, pledge, encumber or charge any right to a benefit hereunder, then the
right or benefit, in the discretion of the Committee, shall cease. In these
circumstances, the Committee may hold or apply the benefit payment or payments,
or any part of it, for the benefit of the Participant or his Beneficiary, the
Participant’s spouse, children, or other dependents, or any of them, in any
manner and in any portion that the Committee may deem proper. Notwithstanding
the foregoing, to the extent permitted by Section 409A of the Code and subject
to Section 6.6, the Committee shall honor a judgment, order or decree from a
state domestic relations court which requires the payment of part or all of a
Participant’s or Beneficiary’s interest under this Plan to an “alternate payee”
as defined in Section 414(p) of the Code.

12.3         Withholding.  Any amount required to be withheld under applicable
Federal, state and local tax laws (including any amounts required to be withheld
under Section 3121(v) of the Code) will be withheld in such manner as the
Committee will determine and any payment under the Plan will be reduced by the
amount so withheld, as well as by any other lawful withholding.

12.4         Governing Law.  This Plan shall be construed and administered in
accordance with the laws of the State of North Carolina to the extent that such
laws are not preempted by Federal law.

12.5         Transfer of Accounts.  The Make-Whole Account and Supplemental
Account, if any, of each Spectra Energy Participant maintained under the Plan
immediately prior to the Distribution Date shall be transferred to the Spectra
Energy Corp Executive Cash Balance Plan and assumed by Spectra Energy Corp as of
the Distribution Date. Each such Spectra Energy Participant shall have no
further rights under the Plan immediately after his Make-Whole Account and
Supplemental Account, if any, are transferred to the Spectra Energy Corp
Executive Cash Balance Plan and assumed by Spectra Energy Corp in accordance
with the terms and conditions of the Employee Matters Agreement by and between
Duke Energy Corporation and

--------------------------------------------------------------------------------

 

 

Spectra Energy Corp (the “Employee Matters Agreement”). Capitalized terms used
in this Section 12.5 that are not defined in this Plan shall have the meaning
set forth in the Employee Matters Agreement.

12.6         Compliance with Section 409A of the Code.  It is intended that Part
II of the Plan comply with the provisions of Section 409A of the Code, so as to
prevent the inclusion in gross income of any amounts deferred hereunder in a
taxable year that is prior to the taxable year or years in which such amounts
would otherwise actually be paid or made available to Participants or
Beneficiaries. This Plan shall be construed, administered, and governed in a
manner that effects such intent, and the Company shall not take any action that
would be inconsistent with such intent. Although the Company shall use its best
efforts to avoid the imposition of taxation, interest and penalties under
Section 409A of the Code, the tax treatment of deferrals under this Plan is not
warranted or guaranteed. Neither the Company, the other members of the
Affiliated Group, their respective directors, officers, employees and advisors,
the Board, nor any committee shall be held liable for any taxes, interest,
penalties or other monetary amounts owed by any Participant, Beneficiary or
other taxpayer as a result of the Plan. Any reference in this Plan to Section
409A of the Code will also include any proposed, temporary or final regulations,
or any other guidance, promulgated with respect to such Section 409A of the Code
by the U.S. Department of Treasury or the Internal Revenue Service. For purposes
of the Plan, the phrase “permitted by Section 409A of the Code,” or words or
phrases of similar import, shall mean that the event or circumstance shall only
be permitted to the extent it would not cause an amount deferred or payable
under the Plan to be includible in the gross income of a Participant or
Beneficiary under Section 409A(a)(1) of the Code.

12.7         Electronic or Other Media.  Notwithstanding any other provision of
the Plan to the contrary, including any provision that requires the use of a
written instrument, the Committee may establish procedures for the use of
electronic or other media in communications and transactions between the Plan or
the Committee and Participants and Beneficiaries. Electronic or other media may
include, but are not limited to, e-mail, the Internet, intranet systems and
automated telephonic response systems.

This amendment and restatement of the Plan has been executed on behalf of the
Company this ___________ day of December, 2013.

DUKE ENERGY CORPORATION 

  

By:____________________________________

 

 

Its:_____________________________________

 

--------------------------------------------------------------------------------

 

 

 

EXHIBIT A
PROGRESS NONQUALIFIED PLAN PARTICIPANT’S BENEFITS UNDER SECTION 6.9

This Exhibit A is used to determine the benefits provided under Section 6.9 to
Progress Nonqualified Plan Participants (or their Eligible Spouses or
Beneficiaries).

1.             Normal Retirement Benefit.  A Progress Nonqualified Plan
Participant who incurs a Separation from Service on or after his Progress Normal
Retirement Date shall be eligible for the normal retirement benefit, which is a
monthly amount equal to his Target Normal Retirement Benefit reduced by the sum
of (a) his Assumed Normal Retirement Pension Benefit and (b) his Social Security
Benefit.

2.             Early Retirement Benefit.  A Progress Nonqualified Plan
Participant who incurs a Separation from Service upon or after his attainment of
age 55 with at least 15 years of Service (except for purposes of calculating
benefits payable under Paragraph 3 and 4 of this Exhibit A below, as applicable)
but prior to his Progress Normal Retirement Date, shall be eligible for the
early retirement benefit, which is a monthly amount equal to his Target Early
Retirement Benefit reduced by the sum of (a) his Assumed Early Retirement
Pension Benefit and (b) his Social Security Benefit; provided, however, such
benefit will be reduced, where applicable, by the following: (i) the amount of
2.5% for each year that such benefit is received prior to his Progress Normal
Retirement Date, and (ii) if such eligible Progress Nonqualified Plan
Participant’s projected years of Service at his Progress Normal Retirement Date
are less than 15, his Target Early Retirement Benefit and his Assumed Early
Retirement Pension Benefit shall be calculated based upon his actual years of
Service at his Progress Early Retirement Date rather than upon his projected
years of Service at his Progress Normal Retirement Date.

3.             Deferred Vested Benefit.  A Progress Nonqualified Plan
Participant who incurs a Separation from Service after completing 10 or more
years of Service but who is not eligible for a retirement benefit under
Paragraph 1 or 2 of this Exhibit A shall be eligible for one of the following
benefits: (a) if at Separation from Service the Progress Nonqualified Plan
Participant is not entitled to a deferred vested Progress Qualified Retirement
Pension under the Progress Qualified Retirement Plan or an early retirement
Progress Qualified Retirement Pension under the Progress Qualified Retirement
Plan, his deferred vested benefit shall be a monthly amount equal to his Target
Deferred Vested Benefit reduced by his Social Security Benefit; (b) if at
Separation from Service such eligible Progress Nonqualified Plan Participant is
entitled to a deferred vested Progress Qualified Retirement Pension under the
Progress Qualified Retirement Plan, his deferred vested benefit shall be a
monthly amount equal to his Target Deferred Vested Benefit reduced by the sum of
(i) his Assumed Deferred Vested Pension Benefit and (ii) his Social Security
Benefit; (c) if at his Separation from Service such eligible Progress
Nonqualified Plan Participant is entitled to an early retirement Progress
Qualified Retirement Pension pursuant to Section 5.02 of the Progress Qualified
Retirement Plan, his deferred vested benefit shall be a monthly amount equal to
his Target Deferred Vested Benefit reduced by the sum of (a) his Assumed Early
Retirement Pension Benefit and (b) his Social Security Benefit; provided,
however, such Assumed Early Retirement Pension Benefit shall be calculated at
his Separation from Service as provided in this Exhibit A, but without regard to
projected pay credits, and, if applicable, projected transition credits.

4.             Definitions.  For purposes of Section 6.9, this Exhibit A, and
sections expressly stated, the following terms shall have the following meanings
unless a different meaning is clearly required by the context:

Assumed Deferred Vested Pension Benefit.  Shall mean the monthly benefit of the
deferred vested Progress Qualified Retirement Pension to commence on his
Progress Normal Retirement Date payable in the form of an annuity to which a
separated Progress Nonqualified Plan Participant would be entitled under the
Progress Qualified Retirement Plan, calculated with the following assumptions
based on such Progress Nonqualified Plan Participant’s marital status at the
time benefits hereunder commence: (a) In the case of a Progress Nonqualified
Plan Participant with an Eligible Spouse, in the form of a 50% Qualified Joint
and Survivor Annuity as provided in the Progress Qualified Retirement Plan. (b)
In the case of a Progress Nonqualified Plan Participant without an Eligible
Spouse, in the form of a Single Life Annuity as provided in the Progress
Qualified Retirement Plan. (c) Without regard to any other benefit payment
option under the Progress Qualified Retirement Plan.

Assumed Early Retirement Pension Benefit.  Shall mean the monthly benefit of the
normal retirement Progress Qualified Retirement Pension payable in the form of
an annuity to which a Progress Nonqualified Plan Participant would be entitled
under the Progress Qualified Retirement Plan projected at his Progress Normal
Retirement Date based on the following:

(I)            The Progress Nonqualified Plan Participant’s account balance
under the Progress Qualified Retirement Plan is determined at the time of the
Progress Nonqualified Plan Participant’s actual Separation from Service. The
foregoing is increased by (i) the pay credits and, if applicable, transition
credits, that the Progress Nonqualified Plan Participant would have received
from his actual Separation from Service through his Progress Normal Retirement
Date using the Progress Nonqualified Plan Participant’s rate of compensation at
his actual Separation from Service (or, if compensation under the Progress
Qualified Retirement Plan includes variable compensation, then compensation for
the calendar year prior to his actual Separation from Service) and the pay
credit table in effect at his actual Separation from Service and (ii) interest
credits in accordance with the rate schedule (or, if applicable, variable rate)
in effect on the Progress Nonqualified Plan Participant’s actual Separation from
Service 

(II)           The amount determined in (I) above is adjusted based upon the
Progress Nonqualified Plan Participant’s marital status at the time benefits
hereunder commence as follows: (a) In the case of a Progress Nonqualified Plan
Participant with an Eligible Spouse, in the form of a 50% Qualified Joint and
Survivor Annuity as provided in the Progress Qualified Retirement Plan. (b) In
the case of a Progress Nonqualified Plan Participant without an Eligible Spouse,
in the form of a Single Life Annuity as provided in the Progress Qualified
Retirement Plan. (c) Without regard to any other benefit payment option under
the Progress Qualified Retirement Plan. 

Assumed Normal Retirement Pension Benefit. Shall mean the monthly benefit of the
normal retirement Progress Qualified Retirement Pension payable in the form of
an annuity to which a Progress Nonqualified Plan Participant would be entitled
under the Progress Qualified Retirement Plan if he retired at his Progress
Normal Retirement Date, calculated with the following assumptions based on his
marital status at the time benefits hereunder commence: (a) In the case of a
Progress Nonqualified Plan Participant with an Eligible Spouse, in the form of a
50% Qualified Joint and Survivor Annuity as provided in the Progress Qualified
Retirement Plan. (b) In the case of a Progress Nonqualified Plan Participant
without an Eligible Spouse, in the form of a Single Life Annuity as provided in
the Progress Qualified Retirement Plan. (c) Without regard to any other benefit
payment option under the Progress Qualified Retirement Plan.

--------------------------------------------------------------------------------

 

ECBP Benefit for Progress Nonqualified Plan Participant. Shall mean the benefit
under Article IV of the Plan (i.e., the sum of the balance in the Progress
Nonqualified Plan Participant’s Make-Whole Benefit Account and Supplemental
Benefit Account attributable to pay and supplemental credits made from July 2,
2012 until Separation from Service) determined at the time payment actually
occurs under Section 6.9(b), actuarially adjusted to the payment form in which
the Progress Nonqualified Plan Participant’s Frozen Progress Nonqualified Plan
Benefit is payable at commencement (for purposes of clarity, single life
annuity, single life annuity with 120 monthly payments guaranteed, or 50%
Qualified Joint and Survivor Annuity, as applicable). Any actuarial adjustment
shall be determined using the mortality and interest assumptions under the Duke
Energy Retirement Cash Balance Plan as in effect from time to time for
converting the cash balance account to a form of payment. For purposes of
clarity, note that, as of July 2, 2012, the Duke Energy Retirement Cash Balance
Plan uses the applicable mortality table as defined in Section 417(e)(3) of the
Code and the applicable interest rate as provided in Section 417(e) of the Code
for the month of August prior to the beginning of the year during which
commencement is to occur to convert the cash balance to a single life annuity
and uses the 1983 Group Annuity Mortality Table weighted 50% male and 50% female
and 7% interest compounded annually to convert the single life annuity to other
optional forms of payment.

Eligible Spouse. Shall mean the spouse of a Progress Nonqualified Plan
Participant who, under the laws of the State where the marriage was contracted,
is deemed married to that Progress Nonqualified Plan Participant on the date on
which the payments from this Plan are to begin to the Progress Nonqualified Plan
Participant, except that, for purposes of Section 6.9(c) and (d), Eligible
Spouse shall mean a person who is married to a Progress Nonqualified Plan
Participant for a period of at least one year prior to his death. For purposes
of applying Sections 6.8, 11.1, 11.2, 12.2 and 12.6 of the Plan, an Eligible
Spouse of a Progress Nonqualified Plan Participant shall be deemed to be that
Progress Nonqualified Plan Participant’s “Beneficiary”.

50% Qualified Joint and Survivor Annuity.  Shall have the meaning given to such
term in the Progress Qualified Retirement Plan.

Final Average Salary.  Shall mean, a Progress Nonqualified Plan Participant’s
average monthly Progress Salary (as defined below) during the 36 completed
calendar months of highest compensation within the 120-month period immediately
preceding July 2, 2012. In determining average monthly Progress Salary (i)
annual incentives and other similar payments shall be deemed received in twelve
(12) equal payments beginning with the eleventh preceding month and ending with
the month such payments were actually made (for purposes of clarity, the payment
must actually have been made prior to July 2, 2012 for such payment to be
included in determining Final Average Salary), and (ii) amounts of compensation
deferred under any deferred compensation plan or arrangement shall be deemed
received in the months such payments would have been received assuming no
deferral had occurred. For years of Service granted under the terms of a written
employment agreement, Progress Salary during each such month is deemed to be
zero dollars ($0.00) for purposes of calculating Final Average Salary. Solely
for purposes of determining a Progress Nonqualified Plan Participant’s Minimum
Progress Nonqualified Plan Benefit under Section 6.9(a)(ii) and the Target
Pre-Retirement Death Benefit determined as of the Progress Nonqualified Plan
Participant’s actual date of death under Section 6.9(d)(ii), the Final Average
Salary (as determined above) shall be increased by the increase in the Consumer
Price Index –Urban Wage Earners and Clerical Workers (“CPI-W”) for the period
from July 2, 2012 to the earliest to occur of the Progress Nonqualified Plan
Participant’s death, Separation from Service, Progress Early Retirement Date, or
Progress Normal Retirement Date, whichever is applicable.

Frozen Progress Nonqualified Plan Benefit.  Shall mean the Normal Retirement
Benefit, Early Retirement Benefit or Deferred Vested Benefit, as applicable,
determined under Paragraph 1, 2 or 3, as applicable, of this Exhibit A as if the
Progress Nonqualified Plan Participant incurred a Separation from Service as of
July 2, 2012, subject, however, to the following:

(I)            If the Progress Nonqualified Plan Participant is eligible for an
Early Retirement Benefit under Paragraph 2 of Exhibit A at the time that the
Progress Nonqualified Plan Participant’s benefit commences, the reduction (if
any) for commencement prior to the Progress Nonqualified Plan Participant’s 65th
birthday shall be determined as provided in Exhibit A at the time that the
Progress Nonqualified Plan Participant’s benefit commences. 

(II)           The Progress Nonqualified Plan Participant’s marital status (and
payment form) shall be determined at the time that the Progress Nonqualified
Plan Participant’s benefit commences. 

(III)          The Assumed Deferred Vested Pension Benefit, Assumed Early
Retirement Pension Benefit or Assumed Normal Retirement Pension Benefit, as
applicable, shall be determined as of July 2, 2012 and without regard to the
limitations imposed by Section 415 of the Code with respect to the Progress
Qualified Retirement Plan. 

(IV)          For purposes of clarity, the Progress Nonqualified Plan
Participant’s Final Average Salary, Service, Social Security Benefit, and,
except to the extent provided in (I) and (II), eligibility for a Normal
Retirement Benefit, Early Retirement Benefit, or Deferred Vested Benefit, as
applicable, shall be determined as of July 2, 2012. 

Minimum Progress Nonqualified Plan Benefit. Shall mean the Normal Retirement
Benefit, Early Retirement Benefit or Deferred Vested Benefit, as applicable,
determined under this Exhibit A as of the time of the Progress Nonqualified Plan
Participant’s actual Separation from Service, subject to the following:

(I)            The Progress Nonqualified Plan Participant’s Final Average Salary
shall be determined as provided in this Exhibit A (for purposes of clarity,
determined at July 2, 2012 and as adjusted for cost of living from July 2, 2012
to the earliest to occur of the Progress Nonqualified Plan Participant’s death,
Separation from Service, Progress Early Retirement Date, or Progress Normal
Retirement Date, whichever is applicable). 

(II)           The Progress Nonqualified Plan Participant’s Assumed Deferred
Vested Pension Benefit, Assumed Early Retirement Pension Benefit or Assumed
Normal Retirement Pension Benefit, as applicable, shall be determined at the
time of the Progress Nonqualified Plan Participant’s actual Separation from
Service. 

(III)          The Progress Nonqualified Plan Participant’s marital status (and
payment form) shall be determined at the time that the Progress Nonqualified
Plan Participant’s benefit commences. 

(IV)          For purposes of clarity, the Participant’s Service, Social
Security Benefit, and eligibility for a Normal Retirement Benefit, Early
Retirement Benefit or Deferred Vested Benefit, as applicable, shall be
determined as of the time of the Progress Nonqualified Plan Participant’s actual
Separation from Service. 

 

--------------------------------------------------------------------------------

 

Progress Early Retirement Date.  Shall mean the date on which a Progress
Nonqualified Plan Participant who qualifies for the early retirement benefit of
Paragraph 2 of this Exhibit A retires from the employ of the Affiliated Group.

Progress Normal Retirement Date. Shall mean the first day of the calendar month
coinciding with or next following the Progress Nonqualified Plan Participant’s
65th birthday.

Progress Nonqualified Plan.  Shall have the meaning given that term in Article
I.

Progress Nonqualified Plan Participant.  Shall have the meaning given that term
in Section 3.3.

Progress Qualified Retirement Pension.  Shall mean a level monthly annuity which
is payable under the Progress Qualified Retirement Plan as of the first day of
the first period for which an amount is payable as an annuity if the Progress
Nonqualified Plan Participant elected an annuity form of benefit.

Progress Qualified Retirement Plan.  Shall mean the “Progress Energy Pension
Plan” (as amended effective January 1, 2002) as it may be amended from time to
time thereafter, and shall include, if applicable, any plan into which the
Progress Energy Pension Plan is merged.

Progress Salary.  Shall mean the sum of: (1) The annual base compensation paid
prior to July 2, 2012 by Progress Energy, Inc. and its participating affiliates
to a Progress Nonqualified Plan Participant, and (2) annual cash awards made
prior to July 2, 2012 under incentive compensation programs of Progress Energy,
Inc. and its participating affiliates, excluding, however, any payment made
under Progress Energy’s Long-Term Compensation Program or Progress Energy’s
equity incentive plans, and (3) amounts of annual compensation deferred prior to
July 2, 2012 under any deferred compensation plan or arrangement of Progress
Energy, Inc. and its participating affiliates (including, without limitation,
the “Executive Deferred Compensation Plan,” the “Deferred Compensation Plan for
Key Management Employees of Progress Energy, Inc.,” the “Progress Energy, Inc.
Management Deferred Compensation Plan” and the “Progress Energy 401(k) Savings
and Stock Ownership Plan”) and which, but for the deferral, would have been
reflected in Internal Revenue Service Form W-2.

Service.  Shall have the same meaning as “Eligibility Service” as provided in
the Progress Qualified Retirement Plan, plus any additional years of service
that may have been granted to the Progress Nonqualified Plan Participant in
connection with the Progress Nonqualified Plan. For purposes of clarity, Service
for purposes of calculating the Frozen Progress Nonqualified Plan Benefit is
determined (and frozen) as of July 2, 2012.

Single Life Annuity.  Shall have the meaning given to such term in the Progress
Qualified Retirement Plan.

Social Security Benefit.  Shall mean the monthly amount of benefit which a
Progress Nonqualified Plan Participant is or would be entitled to receive at age
65 as a primary insurance amount under the federal Social Security Act, as
amended, whether or not he applies for such benefit, and even though he may lose
part or all of such benefit through delay in applying for it, by making
application prior to age 65 for a reduced benefit, by entering into covered
employment, or for any other reason. The amount of such Social Security Benefit
to which the Progress Nonqualified Plan Participant is or would be entitled
shall be estimated by the Committee for the purposes of this Plan as of the
January 1 of the year in which his Separation from Service occurs on the
following basis: (a) For a Progress Nonqualified Plan Participant entitled to a
normal retirement benefit, on the basis of the federal Social Security Act as in
effect on the January 1 coincident with or next preceding his Progress Normal
Retirement Date (regardless of any retroactive changes made by legislation
enacted after said January 1); (b) For a Progress Nonqualified Plan Participant
entitled to an early retirement benefit, on the basis of the federal Social
Security Act as in effect on the January 1 coincident with or next preceding his
Progress Early Retirement Date (regardless of any retroactive change made by
legislation enacted after said January 1), assuming that his employment, and
Progress Salary in effect at the Effective Time, continued to age 65; or (c) For
a Progress Nonqualified Plan Participant entitled to a deferred vested benefit
under Paragraph 3 of this Exhibit A, on the basis of the federal Social Security
Act as in effect on the January 1 coincident with or next preceding his
Separation from Service (regardless of any retroactive change made by
legislation enacted after said January 1), assuming that his employment, and
Progress Salary in effect at July 2, 2012, continued to age 65.

Spouse’s Pension.  Shall mean the actual monthly benefit payable to an Eligible
Spouse under the Progress Qualified Retirement Plan, assuming (i) the Eligible
Spouse is the Progress Nonqualified Plan Participant’s Beneficiary under the
Progress Qualified Retirement Plan, and (ii) the Eligible Spouse commences
payment under the Progress Qualified Retirement Plan in the form of an annuity
in the month following the month of the Progress Nonqualified Plan Participant’s
death.

Target Early Retirement Benefit.  Shall mean an amount equal to a Progress
Nonqualified Plan Participant’s Final Average Salary determined at his Progress
Early Retirement Date multiplied by 2.25% for each projected year of Service at
his Progress Normal Retirement Date up to a maximum of 62%. Notwithstanding the
foregoing, with respect to a Progress Nonqualified Plan Participant who was a
member of Progress Energy Inc.’s Senior Management Committee on December 31,
2008, the Target Early Retirement Benefit shall be determined by multiplying the
Progress Nonqualified Plan Participant’s Final Average Salary by 4% for each
projected year of Service at his Progress Normal Retirement Date up to a maximum
of 62%.

Target Normal Retirement Benefit.  Shall mean an amount equal to a Progress
Nonqualified Plan Participant’s Final Average Salary determined at his Progress
Normal Retirement Date multiplied by 2.25% for each year of Service at his
Progress Normal Retirement Date up to a maximum of 62%. Notwithstanding the
foregoing, with respect to a Progress Nonqualified Plan Participant who was a
member of Progress Energy Inc.’s Senior Management Committee on December 31,
2008, the Target Normal Retirement Benefit shall be determined by multiplying
the Progress Nonqualified Plan Participant’s Final Average Salary by 4% for each
projected year of Service at his Progress Normal Retirement Date up to a maximum
of 62%.

Target Pre-Retirement Death Benefit.  Shall mean an amount equal to a deceased
Progress Nonqualified Plan Participant’s Final Average Salary determined at his
death multiplied by 2.25% for each year of Service at his death up to a maximum
of 62%. Notwithstanding the foregoing, with respect to a Progress Nonqualified
Plan Participant who was a member of Progress Energy Inc.’s Senior Management
Committee on December 31, 2008, the Target Pre-Retirement Death Benefit shall be
determined by multiplying the Progress Nonqualified Plan Participant’s Final
Average Salary by 4% for each year of Service at his death up to a maximum of
62%.

Target Deferred Vested Benefit.  Shall mean an amount equal to a Progress
Nonqualified Plan Participant’s Final Average Salary determined at his
Separation from Service multiplied by 2.25% for each year of Service at his
Separation from Service up to a maximum of 62%. Notwithstanding the foregoing,
with respect to a Progress Nonqualified Plan Participant who was a member of
Progress Energy Inc.’s Senior Management Committee on December 31, 2008, the
Target Deferred Vested Benefit shall be determined by multiplying the Progress
Nonqualified Plan Participant’s Final Average Salary by 4% for each year of
Service at his Separation from Service up to a maximum of 62%.

 

--------------------------------------------------------------------------------

 

 

 

EXHIBIT b

CINERGY EXCESS PLAN payment FOrms

Group Description

Traditional Program Benefit:  Participants who as of December 31, 2008 had
terminated employment after 2004 and prior to attaining age 50 (code 3a)

Traditional Program Benefit:  Participants who as of December 31, 2008 had
terminated employment after 2004 and on and after attaining age 50 (code 3b)

Traditional Program Benefit:  Participants who are employed as of December 31,
2008 (code 12)

Traditional Program Benefit:  Participants who become participants after 2008
(code 14)

Cash Balance Make-Whole Account:  Participants who terminated employment after
2004 but before 2007 (code 7)

Cash Balance Make-Whole Account:

Participants who have only participated in the Cash Balance Program and who have
a Cash Balance Make-Whole Account as of December 31, 2008 (code 4)

Participants who elected to participate in the Cash Balance Program effective on
January 1, 2003 and who have a Cash Balance Make-Whole Account as of December
31, 2008 (code 5)

Participants with A+B Conversion who have a Cash Balance Make-Whole Account and
Traditional Program Benefit as of December 31, 2008 (codes 6a and 6b)

Cash Balance Make-Whole Account:  Participants with A+B Conversion and who first
become entitled to a Cash Balance Make-Whole Account after 2008 (codes 11 and
19)

Supplemental Account

Part A Benefit:

Participants with A+B Conversion who become eligible for a Part A Benefit after
2008 (code 19)

Participants with A+B Conversion and became entitled to Part A Benefit under the
Plan in 2008 (code 18b)

Participants with A+B Conversion and Part A Benefit only as of December 31,
2008, but excluding those who first became entitled to a benefit under the Plan
in 2008 (code 13)

Part A Benefit:  Participants with A+B Conversion and who have a Part A Benefit
and a Cash Balance Make-Whole Account as of December 31, 2008, but excluding
those who first became entitled to a benefit under the Plan in 2008 (codes 6a
and 6b)

Mid-Career Benefit (code 9)

 

The term "A+B Conversion" refers to a Participant who elected to start
participating in the Cash Balance Program effective on April 1, 2007, or upon a
later rehire or transfer date, and who previously participated in the
Traditional  Program.

As described in the applicable election forms and the Cinergy Excess Plan as in
effect on December 31, 2013, each group of Cinergy Excess Plan Participants were
given the opportunity to make irrevocable elections regarding their form of
payment and the Cinergy Excess Plan provided default rules regarding the payment
form where no election was made or available.

 

 

--------------------------------------------------------------------------------