Exhibit 10(k)

FPL GROUP, INC.

DEFERRED COMPENSATION PLAN

Amended and Restated
Effective January 1, 2003

 

FPL GROUP, INC.
DEFERRED COMPENSATION PLAN

TABLE OF CONTENTS      

Page

 

ARTICLE I

 

Definitions

 

1.01

Account

or Accounts

2

1.02

Administrator

2

1.03

Annual Deferral Election Form

2

1.04

Award Agreement

2

1.05

Base Salary

2

1.06

Beneficiary Designation Form

2

1.07

Board

2

1.08

Bonus

2

1.09

Change of Control

3

1.10

Committee

5

1.11

Common Stock

5

1.12

Company

5

1.13

Director's Fees

5

1.14

Disability

5

1.15

Distribution Election Form

5

1.16

Distribution Starting Date

6

1.17

Election Period

6

1.18

Employee

6

1.19

Employer

6

1.20

ERISA

7

1.21

Exchange Act

7

1.22

Investment Account

7

1.23

Investment Election Form

7

1.24

IRC

7

1.25

LTIP

7

1.26

LTIP Award

7

1.27

Market Value Per Share

7

1.28

Non-Employee Director

7

1.29

Officer

7

1.30

Participant

7

1.31

Phantom Stock Account

8

1.32

Phantom Shares

8

1.33

Plan

8

1.34

Plan Year

8

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1.35

Section 16 Committee

8

1.36

Section 16 Reporting Person

8

1.37

Subsidiary

8

ARTICLE II

Eligibility

2.01

Eligibility to Participate in the Plan

8

ARTICLE III

Deferred Compensation Benefits

3.01

Deferral Election

8

3.02

Accounts and Investment Allocation

9

ARTICLE IV

Distributions

4.01

Manner of Distribution

12

4.02

Form of Distribution

13

4.03

Hardship/Early Distribution

13

4.04

Distribution Upon a Termination of Employment following Change of Control

14

4.05

Beneficiary Designation

14

4.06

Taxes

14

4.07

Distributions under Domestic Relations Orders

14

ARTICLE V

Administration

5.01

Administration

15

5.02

Liability of Committee and Administrator; Indemnification

15

5.03

Determination of Benefits

15

5.04

Expenses

17

5.05

Compliance with Securities Laws

17

ARTICLE VI

Miscellaneous

6.01

No Trust Created

18

6.02

No Requirement to Fund

18

6.03

Benefits Payable from General Assets

18

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6.04

Successors

18

6.05

No Contract of Employment

18

6.06

Amendment or Termination of Plan

18

6.07

Top Hat Plan

19

6.08

Governing Law

19

6.09

Severability

19

6.10

Construction

19

6.11

Merger or Consolidation or Sale of Assets of Employer

19

6.12

Transfer to an Affiliate of the Employer

19

6.13

Assignment

19

6.14

Incapacity

20

6.15

Effect on Benefits Under Other Plans

20

6.16

Indemnity Upon Change of Control

20

6.17

No Rights as Stockholders

20

Execution Page

20

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FPL GROUP, INC.

DEFERRED COMPENSATION PLAN

THIS FPL GROUP, INC. DEFERRED COMPENSATION PLAN (the "Plan") effective as of
January 1, 2003 (the "Restated Effective Date"), is an amendment and restatement
of the FPL Group, Inc. Deferred Compensation Plan as amended and restated
effective January 1, 2001 (the "Prior Restatement").

W I T N E S S E T H T H A T:

WHEREAS, the officers and a select group of management or highly compensated
employees of FPL Group, Inc. (the "Company") and its subsidiaries and affiliates
(hereinafter collectively referred to as the "Employer") are entitled to
compensation which results from or is attributable to their performance of
services as officers and employees of the Employer and may be awarded bonuses
and performance related compensation pursuant to the Annual Incentive Plan, the
FPL Group Long Term Incentive Plan 1985, the FPL Group, Inc. Long Term Incentive
Plan 1994, the FPL Group, Inc. Amended and Restated Long Term Incentive Plan,
and other incentive compensation plans; and

WHEREAS, directors of the Employer are entitled to fees which result from or are
attributable to their performance of services as members of the Board of
Directors (and committees thereof) of the Employer; and

WHEREAS, the Board of Directors of the Company adopted the FPL Group, Inc.
Deferred Compensation Plan (the "Original Plan"), effective as of January 1,
1995 (the "Effective Date"), to provide deferred compensation to the officers,
directors, and a select group of management or highly compensated employees of
the Employer in order to permit such individuals to elect to defer receipt of
all or a portion of their base salary, bonuses, incentive plan awards and/or
directors' fees in accordance with the provisions of the Plan; and

WHEREAS, the Company desires to amend and restate the Prior Restatement to,
inter alia, simplify administration so as to reduce the reporting and disclosure
burdens of officers and directors of the Company now required as a result of the
recent enactment of the Sarbanes-Oxley Act of 2002, and to supplement the
financial hardship provision with a clearly defined early distribution provision
that imposes a significant early withdrawal penalty; and

WHEREAS, the Employer continues to intend that this Plan be considered an
unfunded arrangement that is maintained primarily to provide deferred
compensation to members of a select group of management or highly compensated
employees of the Employer, for purposes of the Employee Retirement Income
Security Act of 1974, as amended ("ERISA");

NOW, THEREFORE, the Company hereby amends and restates the Prior Restatement
effective as of the Restated Effective Date for the exclusive benefit of
participants and their beneficiaries on the following terms and conditions:

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ARTICLE I
DEFINITIONS

The following terms when used herein shall have the designated meaning unless a
different meaning is plainly required by the context in which the term is used:

1.01

"Account

" or "Accounts" shall mean the account or accounts established and maintained
for a Participant pursuant to Article III of the Plan. A Participant's Account
shall consist of the Participant's Investment Account and Phantom Stock Account
(including the Cash Account).

1.02

"Administrator" shall mean an officer or officers of the Employer designated by
the Company to administer the Plan or, until the Company designates such an
officer or officers, the Vice President of Human Resources of the Company.

1.03

"Annual Deferral Election Form" shall mean the form or forms that may be
approved by the Administrator from time to time for use by a Participant to
elect to defer Base Salary, Bonuses, LTIP Awards, and/or Director's Fees under
the Plan, subject to the applicable limitations contained in the Plan.

1.04

Award Agreement" shall mean an agreement executed between the Company and an
Officer pursuant to the LTIP setting forth the manner and form of payment of
such Officer's LTIP Award.

1.05

"Base Salary" shall mean the base salary of a Participant paid by the Employer,
exclusive of Bonuses, LTIP Awards, and Director's Fees.

1.06

"Beneficiary Designation Form" shall mean the form or forms that may be approved
by the Administrator from time to time for use by a Participant to designate a
beneficiary or beneficiaries pursuant to Section 4.05.

1.07

"Board" shall mean the Board of Directors of the Company.

1.08

"Bonus" shall mean any bonus that the Participant is awarded pursuant to the
Annual Incentive Plan and such other payments awarded under such other incentive
compensation plans that are designated by the Administrator as eligible for
deferral under this Plan.

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1.09

"Change of Control" shall mean:

(1)

The acquisition by any individual, entity or group (within the meaning of
Section 13(d)(3) or 14(d)(2) of the Exchange Act) of beneficial ownership
(within the meaning of Rule 13d-3 promulgated under the Exchange Act) of 20% or
more of either (x) the then outstanding shares of common stock of the Company
(the "Outstanding Company Common Stock") or (y) the combined voting power of the
then outstanding voting securities of the Company entitled to vote generally in
the election of directors (the "Outstanding Company Voting Securities");
provided, however, that the following acquisitions (collectively, the "Excluded
Acquisitions") shall not constitute a Change of Control (it being understood
that shares acquired in an Excluded Acquisition may nevertheless be considered
in determining whether any subsequent acquisition by such individual, entity or
group (other than an Excluded Acquisition) constitutes a Change of Control): (i)
any acquisition directly from the Company or any Subsidiary; (ii) any
acquisition by the Company or any Subsidiary; (iii) any acquisition by any
employee benefit plan (or related trust) sponsored or maintained by the Company
or any Subsidiary; (iv) any acquisition by an underwriter temporarily holding
Company securities pursuant to an offering of such securities; (v) any
acquisition in connection with which, pursuant to Rule 13d-1 promulgated
pursuant to the Exchange Act, the individual, entity or group is permitted to,
and actually does, report its beneficial ownership on Schedule 13G (or any
successor Schedule); provided that, if any such individual, entity or group
subsequently becomes required to or does report its beneficial ownership on
Schedule 13D (or any successor Schedule), then, for purposes of this paragraph,
such individual, entity or group shall be deemed to have first acquired, on the
first date on which such individual, entity or group becomes required to or does
so report, beneficial ownership of all of the Outstanding Company Common Stock
and/or Outstanding Company Voting Securities beneficially owned by it on such
date; or (vi) any acquisition in connection with a Business Combination (as
hereinafter defined) which, pursuant to subsection (3) below, does not
constitute a Change of Control; or

(2)

Individuals who, as of the Restated Effective Date, constitute the Board (the
"Incumbent Board") cease for any reason to constitute at least a majority of the
Board; provided, however, that any individual becoming a director subsequent to
such date whose election, or nomination for election by the Company's
shareholders, was approved by a vote of at least a majority of the directors
then comprising the Incumbent Board shall be considered as though such
individual were a member of the Incumbent Board, but excluding, for this
purpose, any such individual whose initial assumption of office occurs as a
result of either an actual or threatened election contest with respect to the
election or removal of directors or other actual or threatened solicitation of
proxies or consents by or on behalf of an individual, entity or group other than
the Board; or

(3)

Approval by the shareholders of the Company of a reorganization, merger,
consolidation or other business combination (any of the foregoing, a "Business
Combination") of the Company or any Subsidiary with any other corporation, in
any case with respect to which:

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(a)

the Outstanding Company Voting Securities outstanding immediately prior to such
Business Combination do not, immediately following such Business Combination,
continue to represent (either by remaining outstanding or being converted into
voting securities of the resulting or surviving entity or any ultimate parent
thereof) more than 60% of the outstanding common stock and of the then
outstanding voting securities entitled to vote generally in the election of
directors of the resulting or surviving entity (or any ultimate parent thereof);
or

(b)

less than a majority of the members of the board of directors of the resulting
or surviving entity (or any ultimate parent thereof) in such Business
Combination (the "New Board") consists of individuals ("Continuing Directors")
who were members of the Incumbent Board (as defined in subsection (2) above)
immediately prior to consummation of such Business Combination (excluding from
Continuing Directors for this purpose, however, any individual whose election or
appointment to the Board was at the request, directly or indirectly, of the
entity which entered into the definitive agreement with the Company or any
Subsidiary providing for such Business Combination); or

(c)

in the case of a Business Combination with an unaffiliated third party as a
result of which at least a majority of the New Board will initially consist of
Continuing Directors, the Board determines, prior to such approval by
shareholders, that there does not exist a reasonable assurance that, for at
least a two-year period following consummation of such Business Combination, at
least a majority of the members of the New Board will continue to consist of
Continuing Directors and individuals whose election, or nomination for election
by shareholders of the resulting or surviving entity (or any ultimate parent
thereof) in such Business Combination, would be approved by a vote of at least a
majority of the Continuing Directors and individuals whose election or
nomination for election has previously been so approved;

provided, however, that prior to any such approval by shareholders, the Board
may determine, in its sole discretion, that under the particular facts and
circumstances, a Change of Control shall not occur until the consummation of
such Business Combination; or

(4)

Approval by the shareholders of the Company of (i) a complete liquidation or
dissolution of the Company or (ii) a sale or other disposition of all or
substantially all of the assets of the Company, other than to a corporation with
respect to which, following such sale or other disposition, more than 60% of,
respectively, the then outstanding shares of common stock of such corporation
and the combined voting power of the then outstanding voting securities of such
corporation entitled to vote generally in the election of directors is then
beneficially owned, directly or indirectly, by all or substantially all of the
individuals and entities who were the beneficial owners, respectively, of the
Outstanding Company Common Stock and Outstanding Company Voting Securities
immediately prior to such sale or other disposition in substantially the same
proportion as their ownership, immediately prior to such sale or other
disposition, of the Outstanding Company Common Stock and Outstanding Company
Voting Securities as the case may be; provided, however, that prior to any such
approval by shareholders, the Board may determine, in its sole discretion, that
under the particular facts and circumstances, a Change of Control shall not
occur until the consummation of such sale or other disposition.

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The term "the sale or disposition by the Company of all or substantially all of
the assets of the Company" shall mean a sale or other disposition transaction or
series of related transactions involving assets of the Company or of any
Subsidiary (including the stock of any Subsidiary) in which the value of the
assets or stock being sold or otherwise disposed of (as measured by the purchase
price being paid therefor or by such other method as the Board determines is
appropriate in a case where there is no readily ascertainable purchase price)
constitutes more than two-thirds of the fair market value of the Company (as
hereinafter defined). The "fair market value of the Company" shall be the
aggregate market value of the then Outstanding Company Common Stock (on a fully
diluted basis) plus the aggregate market value of the Company's other
outstanding equity securities. The aggregate market value of the shares of
Outstanding Company Common Stock shall be determined by multiplying the number
of shares of Outstanding Company Common Stock (on a fully diluted basis)
outstanding on the date of the execution and delivery of a definitive agreement
with respect to the transaction or series of related transactions (the
"Transaction Date") by the average closing price of the shares of Outstanding
Company Common Stock for the ten trading days immediately preceding the
Transaction Date. The aggregate market value of any other equity securities of
the Company shall be determined in a manner similar to that prescribed in the
immediately preceding sentence for determining the aggregate market value of the
shares of Outstanding Company Common Stock or by such other method as the Board
shall determine is appropriate.

1.10

"Committee" shall mean the Compensation Committee of the Board or any such other
committee designated by the Board, which shall consist of at least three members
of the Board each of whom are not employees of the Company or any of its
subsidiaries or affiliates.

1.11

"Common Stock" shall mean the common stock, $.01 par value per share, of the
Company.

1.12

"Company" shall mean FPL Group, Inc.

1.13

"Director's Fees" shall mean the fees of a Participant which result from or are
attributable to the performance of services by such Participant as a member of
the Board of Directors (or committee thereof) of the Employer.

1.14

"Disability" shall have the meaning set forth in the Long Term Disability Plan
For Employees of FPL Group and Affiliates.

1.15

"Distribution Election Form " shall mean the form or forms that may be approved
by the Administrator from time to time for use by a Participant to elect a
Distribution Starting Date and payment schedule pursuant to Sections 1.17 and
4.01.

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1.16

"Distribution Starting Date" shall mean:

(a)

the first day of the first month following the earliest of the Participant's
retirement, death, Disability, or other termination of service;

(b)

the first day of the first Plan Year following the earliest of the Participant's
retirement, death, Disability, or other termination of service; or

(c)

subject to the Administrator authorizing a Participant to select a specific date
on which his or her benefits under the Plan shall commence, a specific date
specified by the Participant,

or as soon thereafter as is administratively feasible, as elected by the
Participant in his or her Distribution Election Form.

Effective for distributions commencing before January 1, 2001, in the event the
Participant fails to elect one of the dates described above, his or her
"Distribution Starting Date" shall be the first day of the first month following
the earliest of the Participant's retirement, death, Disability, or other
termination of service, or as soon thereafter as is administratively feasible.
Effective for distributions commencing on or after January 1, 2001, in the event
the Participant fails to elect one of the dates described above, his or her
"Distribution Starting Date" shall be the first day of the first Plan Year
following the earliest of the Participant's retirement, death, Disability, or
other termination of service, or as soon thereafter as is administratively
feasible.

For purposes of this Plan, if the Participant transfers from one subsidiary or
affiliate of the Employer to another subsidiary or affiliate of the Employer,
such transfer shall not be considered a termination of service, and a
termination of service shall occur only when the Participant separates from the
employ of all subsidiaries and affiliates of the Employer.

1.17

Election Period" shall mean the period that occurs annually, as established by
the Administrator, during which a Participant may deliver an Annual Deferral
Election Form and a Distribution Election Form to the Administrator and which
shall commence during the calendar year prior to the deferral and shall end
before the date on which a Participant's benefits under the Plan would otherwise
be treated as constructively received or the economic benefit of which would be
enjoyed (within the meaning of the Federal tax laws).

1.18

"Employee" shall mean an employee of the Employer in grade 12 or above, provided
that such individual is among a select group of management or highly compensated
employees within the meaning of ERISA Sec. 201(2).

1.19

Employer" shall mean the Company and its subsidiaries and affiliates.

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1.20

"ERISA" shall mean the Employee Retirement Income Security Act of 1974, as
amended.

1.21

"Exchange Act " shall mean the Securities Exchange Act of 1934, as amended.

1.22

"Investment Account" shall mean an account established and maintained for a
Participant pursuant to Section 3.02(a) and (b)(1).

1.23

"Investment Election Form" shall mean the form or forms that may be approved by
the Administrator from time to time for use by a Participant to allocate
deferred Base Salary, Bonuses, LTIP Awards, and/ to the extent allocated to the
Participant's Investment Account, Director's Fees, among the investment funds
selected by the Company pursuant to Section 3.02(b)(1)(ii) and/or
3.02(b)(1)(iii), as applicable.

1.24

"IRC" shall mean the Internal Revenue Code of 1986, as amended.

1.25

"LTIP" shall mean the Amended and Restated FPL Group, Inc. Long Term Incentive
Plan, the FPL Group, Inc. Long Term Incentive Plan 1994 or the FPL Group, Inc.
Long Term Incentive Plan 1985, as applicable.

1.26

"LTIP Award" shall mean an award granted pursuant to the terms of the LTIP,
other than an award of Restricted Stock (as defined in the LTIP).

1.27

"Market Value Per Share" shall mean the closing sales price on the relevant date
for shares of Common Stock as reported on the Composite Transactions Tape of the
New York Stock Exchange, Inc. on such date. If such date is not a trading day or
no sales occur on such date, the "Market Value Per Share" means the weighted
average of the closing prices on the nearest date before and the nearest date
after the valuation date. The average is to be weighed inversely by the
respective number of trading days between the selling dates and the valuation
date.

1.28

"Non-Employee Director" shall mean a member of the Board who is not an employee
of the Company or any of its subsidiaries or affiliates.

1.29

"Officer" shall mean an elected officer of the Employer, provided that such
individual is among a select group of management or highly compensated employees
within the meaning of ERISA Sec. 201(2).

1.30

"Participant" shall mean a Non-Employee Director, Officer or Employee who is
eligible to participate in the Plan and has elected to defer Base Salary,
Bonuses, LTIP Awards and/or Director's Fees, as provided in Section 3.01.

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1.31

"Phantom Stock Account" shall mean an account established and maintained for a
Participant pursuant to Sections 3.02(a) and 3.02(b)(2).

1.32

"Phantom Shares" shall mean hypothetical shares of Common Stock.

1.33

"Plan" shall mean the FPL Group, Inc. Deferred Compensation Plan, as contained
herein, and as may be amended from time to time.

1.34

"Plan Year" shall mean the calendar year.

1.35

"Section 16 Committee" shall mean the committee of the Board established for the
purposes of approving certain matters relating to Section 16 Reporting Persons.

1.36

"Section 16 Reporting Person" shall mean any (a) director of the Company or (b)
officer of the Employer designated by the Board to be an "executive officer" for
purposes of Section 16(a) of the Exchange Act.

1.37

"Subsidiary" shall mean any corporation (other than the Company) with respect to
which the Company owns, directly or indirectly, 50% or more of the total
combined voting power of all classes of stock. In addition, any other related
entity may be designated by the Board as a Subsidiary, provided such entity
could be considered as a subsidiary according to generally accepted accounting
principles.

ARTICLE II
ELIGIBILITY

2.01

Eligibility to Participate in the Plan. A Non-Employee Director, Officer or
Employee shall be eligible to participate in the Plan to the extent provided
herein.

ARTICLE III
DEFERRED COMPENSATION BNEFITS

3.01

Deferral Election.

(a)

In General. A Participant may elect to defer all or a portion of his or her
items of compensation to the extent provided in this Article by completing,
signing, and delivering an Annual Deferral Election Form to the Administrator
during an Election Period:

-8-

 

(1)

A Non-Employee Director may defer all or a portion of his or her Director's
Fees;

(2)

An Officer may defer all or a portion of his or her Base Salary, Bonuses, and/or
LTIP Awards; and

(3)

An Employee (other than an Officer) may defer all or a portion of his or her
Bonuses, and, to the extent that the Administrator may in its sole discretion
permit, all or a portion of his or her Base Salary and/or LTIP Awards.

(b)

Modification or Revocation of Deferral Elections. A deferral election made
pursuant to Subsection (a) during the Election Period by a Participant may be
modified or revoked at any time during the Plan Year by the making of a new
deferral election on the Annual Deferral Election Form. Such new deferral
election shall be effective only with respect to items of compensation
attributable to services performed subsequent to the date such election is
delivered to and accepted by the Administrator, and such election shall in no
event be effective with respect to any items of compensation attributable to
services performed on or prior to such date. In addition to the foregoing,
modification or revocation by a Section 16 Reporting Person of such a deferral
election which is (i) credited or to be credited to the Company Stock Fund or a
Phantom Stock Account and (ii) after the Section 16 Committee has given its
prior approval with respect to such transactions, shall require the prior
approval of the Section 16 Committee.

(c)

Limitation on Deferrals. Notwithstanding anything to the contrary in this Plan,
the amount to be deferred under this Plan may not reduce the amount of Base
Salary, Bonuses, LTIP Awards, and/or Director's Fees which would be paid to the
Participant (determined after taking the election into account) below that
required to pay the Participant's portion of any taxes due under Chapter 21
(Federal Insurance Contributions Act) of the IRC, any other employment taxes,
and the amount, if any, required to be withheld for income tax purposes.

3.02

Accounts and Investment Allocation.

(a)

In General. An Investment Account and a Phantom Stock Account shall be
established and maintained for each Participant. The Investment Account, and the
Cash Account within the Phantom Stock Account, shall be measured in dollars and
the Phantom Stock Account (except for the Cash Account) shall be measured in
Phantom Shares (rounded to three decimal places). The Accounts shall be
hypothetical in nature and shall be maintained for bookkeeping purposes only.
Neither the Plan nor any of the Accounts shall hold or be required to hold any
actual funds or assets.

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(b)

Crediting of Accounts.

(1)

Investment Account.

(i)

Crediting Contributions to the Investment Account. When a Participant's
Investment Account is to be credited with a deferred amount, that amount shall
be credited to the Investment Account as of the close of business on the date
that such amount would have otherwise been paid to the Participant.

(ii)

Crediting Earnings on the Investment Account. Subject to the limitations of
Subsection (b)(1)(iii), the Administrator may permit a Participant to allocate
on an Investment Election Form, the deferred amounts credited to his or her
Investment Account among one or more investment funds selected by the Company.
In the event a Participant fails to elect one or more investment funds on an
Investment Election Form, the Participant's Investment Account shall be invested
in a default investment fund designated by the Administrator until such time as
the Participant shall submit an Investment Election Form to the Administrator.
Subject to the limitations of Subsection (b)(1)(iii), a Participant may
re-allocate the deferred amounts among such investment funds at any time or from
time to time by submitting a new Investment Election Form to the Administrator.
Deferred amounts allocated to an investment fund shall be deemed to be invested
in such investment fund and shall be adjusted each business day to reflect the
hypothetical income, gain and loss, including any unrealized appreciation or
depreciation on such investment fund.

(iii)

Company Stock Fund. A Participant may allocate deferred amounts to an investment
fund that tracks, or invests primarily in, the Common Stock of the Company (a
"Company Stock Fund"). If a Participant allocates deferred amounts to the
Company Stock Fund, such amounts shall initially be credited to a stable value
investment fund designated by the Administrator (the "Interim Investment Fund").
On the immediately following date on which a cash dividend is paid to holders of
Common Stock (the "Dividend Payment Date"), all amounts credited to such Interim
Investment Fund shall be transferred to the Company Stock Fund in the
Participant's Investment Account. Any request to transfer a Participant's
allocation of deferred amounts out of the Company Stock Fund will be processed
on the Dividend Payment Date that immediately follows such request.
Notwithstanding the foregoing, any allocation in to, or out of, the Company
Stock Fund by a Section 16 Reporting Person shall require the prior approval of
the Section 16 Committee.

(2)

Phantom Stock Account.

(i)

Crediting Stock-Based Contributions to the Phantom Stock Account. When a
Participant's Phantom Stock Account is to be credited for deferred amounts which
would have otherwise been paid to the Participant in Common Stock, then the
number of shares of Common Stock which would have otherwise been paid to the
Participant shall be credited to the Participant's Phantom Stock Account as of
the date that such payment would have otherwise occurred.

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(ii)

Crediting Cash Dividends to the Phantom Stock Account. The Administrator shall
establish a cash account within each Participant's Phantom Stock Account (the
"Cash Account"). The Cash Account shall be credited on each Dividend Payment
Date with an amount equal to the amount of the cash dividends which a holder of
Common Stock would have received if on the record date for the dividend the
holder was the record holder of a number of shares of Common Stock equal to the
number of Phantom Shares then credited to the Phantom Stock Account. The Cash
Account shall be credited quarterly with interest on the average weighted
balance in such account at the end of the quarter at a rate equal to the prime
rate as published in the Wall Street Journal on the last business day of the
calendar quarter preceding the calendar quarter to which it applies. On the
first Dividend Payment Date of each calendar year commencing on and after the
Restated Effective Date, the balance of the Cash Account attributable to Phantom
Shares first deferred on or after the Restated Effective Date shall be converted
to the number of Phantom Shares (including fractional shares) that could have
been purchased with such balance at the Market Value Per Share on such date.

(iii)

Crediting Stock Dividends on the Phantom Stock Account. A Participant's Phantom
Stock Account shall be credited on each record date for a stock dividend paid to
holders of Common Stock with that number of full and fractional shares of Common
Stock which the Participant's Phantom Stock Account would have received if on
that record date such account had been the holder of record of a number of
shares of Common Stock equal to the number of Phantom Shares (including
fractions) then credited to his or her Phantom Stock Account.

(iv)

Other Adjustments to the Phantom Stock Account. The number of Phantom Shares
shall be adjusted as determined in the discretion of the Administrator to
reflect (i) any change in the outstanding Common Stock by reason of any stock
dividend or split, recapitalization, reorganization, merger, consolidation,
split-up, spin-off or any similar corporate change affecting the Common Stock;
(ii) unusual or nonrecurring events affecting the Company or any subsidiary or
the financial statements of the Company or any subsidiary; or (iii) changes in
applicable laws, regulations, or accounting principles.

(3)

Transfers Prohibited Between Accounts. A Participant shall be prohibited from
transferring any amounts credited to his Phantom Stock Account to his Investment
Account and from transferring any amounts credited to his Investment Account to
his Phantom Stock Account.

(c)

Allocating Contributions Between the Investment Account and the Phantom Stock
Account.

(1)

Deferrals by Officers and Employees. Base Salary, Bonuses, and the portion of
LTIP Awards that would have otherwise been paid in cash shall be credited to the
Participant's Investment Account in accordance with Subsection (b)(1)(i), unless
the Participant elects to invest in the Company Stock Fund, in which case the
amounts shall be credited in accordance with Subsection (b)(1)(iii). The portion
of LTIP Awards that would have otherwise been paid in Common Stock shall be
credited to the Participant's Phantom Stock Account in accordance with
Subsection (b)(2)(i).

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(2)

Deferrals by Non-Employee Directors. Director's Fees that would have otherwise
been paid in cash shall be credited to an Investment Account. Such amounts shall
be credited in accordance with Subsection (b)(1)(i), unless a Non-Employee
Director elects to invest in the Company Stock Fund, in which case the amounts
shall be credited in accordance with Subsection (b)(1)(iii). The portion of the
Director's Fees that would have otherwise been paid in Common Stock shall be
credited to the Participant's Phantom Stock Account in accordance with
Subsection (b)(2)(i).

(d)

Account Statements. The Administrator shall provide to each Participant, within
120 days after the end of each Plan Year, a statement setting forth the balance
of Phantom Shares in the Participant's Phantom Stock Account, the dollar value
of the Cash Account, and the dollar value of the Participant's Investment
Account as of the end of the Plan Year.

ARTICLE IV
DISTRIBUTIONS

4.01

Manner of Distribution. The Employer shall pay to the Participant (or his or her
beneficiary or beneficiaries if the Participant is deceased) his or her entire
Account:

(a)

on the Distribution Starting Date; or

(b)

in substantially equal monthly installments commencing on the Distribution
Starting Date and continuing for a period of up to 10 years;

as elected by the Participant in his or her Distribution Election Form. The
Participant may make a separate distribution election with respect to each of
his or her Phantom Stock Account and Investment Account. For a distribution
election to be valid, it must be made during an Election Period unless otherwise
approved by the Administrator and, in the case of Section 16 Reporting Persons
who have a balance in their Phantom Stock Account (other than the Cash Account
only) or in the Company Stock Fund, or who have a current deferral election to
be credited to a Phantom Stock Account or the Company Stock Fund, with the
additional prior approval by the Section 16 Committee. In the event the
Participant fails to make such a distribution election, the Employer shall pay
to the Participant (or his or her beneficiary or beneficiaries if the
Participant is deceased) his or her entire Account in a single sum on the
Distribution Starting Date. It is the intent of the Employer that such Election
Period with respect to a Participant end before the date on which a
Participant's benefits under this Plan would otherwise be treated as
constructively received or the economic benefit of which would be enjoyed
(within the meaning of the Federal tax laws). After distribution of a
Participant's Account has commenced, a Participant's right to amend his or her
distribution election or elections ceases. Distribution Election Forms submitted
after distribution of a Participant's Account has commenced shall be null and
void.

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The distribution election made in a Participant's most recent Distribution
Election Form shall govern over the distribution elections made in all prior
Distribution Election Forms for such deferred amounts; provided, however, that
the distribution of such deferred amounts commences no sooner than six months
after the date of the most recent Distribution Election Form. If the
distribution of such deferred amounts commences within six months after the date
of the most recent Distribution Election Form, the Distribution Election Form
that was delivered to the Administrator on the most recent date which is more
than six months prior to the distribution of such deferred amounts shall govern
over the distribution election in the Participant's most recent Distribution
Election Form.

4.02

Form of Distribution. Benefits attributable to the value of the Investment
Account and Cash Account shall be distributed to the Participant in cash.
Benefits attributable to the Phantom Stock Account (other than the Cash Account
and any fractional shares) shall be distributed to the Participant in the form
of shares of Common Stock. To the extent that the distribution is in the form of
shares of Common Stock, such distribution shall be subject to all applicable
securities laws and regulations, and the Company shall have taken all steps, if
any, including registration and listing, as may be necessary to make the shares
immediately transferable (by sale or otherwise) by the Participant without
further regulatory action or compliance on the part of the Participant. The
Participant shall reasonably cooperate with the Company, at the Company's
expense, to facilitate such compliance and related actions by the Company.

4.03

Hardship/Early Distribution . The Participant shall be entitled to an early
distribution of all or a portion of his or her Account upon written application
to the Administrator and the determination of the Administrator, in its sole and
absolute discretion, except that in the case of a Section 16 Reporting Person
requesting distribution of all or a portion of his Phantom Stock Account or
Company Stock Fund, the additional prior approval of the Section 16 Committee
shall also be required, that without such distribution, the Participant would
suffer or continue to suffer a financial hardship. A "financial hardship" is a
severe financial hardship to the Participant resulting from a sudden and
unexpected illness or accident of the Participant or of a dependent (as defined
in IRC section 152(a)) of the Participant, loss of the Participant's property
due to casualty, or other similar extraordinary and unforeseeable circumstances
arising as a result of events beyond the control of the Participant. Withdrawals
of amounts because of a financial hardship shall only be permitted to the extent
reasonably needed to satisfy the financial need.

Notwithstanding any provision in this Plan to the contrary, absent a qualifying
financial hardship, a Participant shall be entitled to an early distribution of
all or a portion of his or her Account upon written application to the
Administrator except that in the case of a Section 16 Reporting Person
requesting distribution of all or a portion of his Phantom Stock Account or
Company Stock Fund, the additional prior approval of the Section 16 Committee
shall also be required. An early distribution will made as soon as
administrative feasible following the written application (and approval of the
Section 16 Committee, as applicable) and will be subject to a mandatory 10%
penalty of the withdrawn amount. A Participant who receives an early withdrawal
of all or a portion of his or her benefit will be excluded from eligibility to
defer in the Plan for a 24-month period beginning as of the date of such early
distribution.

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4.04

Distribution Upon a Termination of Employment following a Change of Control

. Anything in this Plan to the contrary notwithstanding, if a Change of Control
occurs and as a result of such Change of Control the Participant's employment
with the Company or its subsidiaries and affiliates is terminated, then the
Employer shall pay to the Participant (or his or her beneficiary or
beneficiaries if the Participant is deceased) his or her entire Account in a
single sum on the first day of the month following the termination of
employment.

4.05

Beneficiary Designation. For purposes of this Plan, a Participant's beneficiary
or beneficiaries under this Plan shall be the person or persons last designated
by a Participant, by written notice filed with the Administrator, to receive a
Plan benefit upon the death of the Participant. The designation of a beneficiary
other than the spouse of the Participant, if any, shall be void unless such
spouse consents to such non-spouse beneficiary designation. In the event a
Participant fails to designate a person or persons as provided above, or if no
beneficiary so designated survives the Participant, then for all purposes of
this Plan, the beneficiary shall be the spouse of the Participant, if living. If
the spouse is not living, then payment shall be made to the beneficiary or
beneficiaries designated by such Participant for the death benefits provided
pursuant to the split dollar arrangement entered into with the Employer. If a
Participant has not entered into a split dollar arrangement with the Employer,
such Participant's beneficiary or beneficiaries under this Plan shall be the
beneficiary or beneficiaries of his or her death benefits under the Medical,
Dental and Life Insurance Plan for Employees of FPL Group, Inc. (or any
successor plan thereof). If a Participant is not a participant in either of the
above described plans, the Participant's beneficiary shall be his or her estate.

4.06

Taxes. All amounts payable to any Participant hereunder may be reduced by any
and all federal, state and local taxes imposed upon the Participant or his or
her beneficiary or beneficiaries which are required to be withheld by the
Employer.

4.07

Distributions under Domestic Relations Orders. Nothing contained in this Plan
prevents the Employer, in accordance with the direction of the Administrator,
from complying with the provisions of a judgment, decree, or order (including
approval of a property settlement agreement) resulting from a divorce, legal
separation, annulment or change in legal custody that assigns to a spouse,
former spouse, child or other dependent of a Participant (an "Alternate Payee")
the right to receive all or a portion of the benefits of a Participant under the
Plan in a form of payment permitted under the terms of the Plan (a "Domestic
Relations Order"). The Employer shall make any payments required under this
Section 4.07 by separate checks to each Alternate Payee, unless otherwise
explicitly provided in the Domestic Relations Order. Distribution to an
Alternate Payee under a Domestic Relations Order is permitted at any time,
irrespective of whether the Participant is currently entitled to a distribution
of his or her benefits under the Plan. A distribution to an Alternate Payee
prior to the time the Participant is entitled to a distribution of his or her
benefits under the Plan (other than a distribution pursuant to Section 4.03) is
available only if the Domestic Relations Order explicitly requires distribution
at that time. Notwithstanding the foregoing, nothing in this Section 4.07
provides a Participant the right to receive a distribution of his or her
benefits at a time not otherwise permitted under the terms of the Plan nor does
it permit the Alternate Payee to receive a form of payment not otherwise
permitted under the Plan.

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Within a reasonable period of time after receiving the Domestic Relations Order,
the Administrator will determine whether such order complies with the terms of
the Plan and will notify the Participant and each Alternate Payee of its
determination. If any portion of the Participant's benefit is payable during the
period the Administrator is making such determination, the Administrator shall
make a separate accounting of the amounts payable.

ARTICLE V
ADMINISTRATION

5.01

Administration. The Administrator shall administer and interpret this Plan in
accordance with the provisions of the Plan in its sole and absolute discretion.
Any determination or decision by the Administrator shall be conclusive and
binding on all persons who at any time have, have had, or may have a claim to
any interest whatsoever under this Plan.

5.02

Liability of Committee and Administrator; Indemnification. To the extent
permitted by law, no member of the Committee (or its delegatee), the Section 16
Committee or the Administrator shall be liable to any person for any action
taken or omitted in connection with the interpretation and administration of
this Plan unless attributable to his or her own gross negligence or willful
misconduct. The Employer shall indemnify the members of the Committee (or its
delegatee), the Section 16 Committee and the Administrator against any and all
claims, losses, damages, expenses, including any counsel fees and costs,
incurred by them, and any liability, including any amounts paid in settlement
with their approval, arising from their action or failure to act, except when
the same is judicially determined to be attributable to their gross negligence
or willful misconduct.

5.03

Determination of Benefits.

(a)

Claim for Benefits. A person, or his or her duly authorized representative, who
believes that he or she is being denied a benefit to which he or she is entitled
under the Plan (hereinafter referred to as a "Claimant") may file a written
request for such benefit with the Administrator, setting forth his or her claim.
The request must be addressed to the Company at its then principal place of
business.

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(b)

Timing and Notification of Benefit Determination.

(1)

Timing. If a claim is wholly or partially denied, the Administrator shall notify
the Claimant of the Plan's adverse benefit determination within a reasonable
period of time, but not later than 90 days after receipt of the claim by the
Plan, unless the Administrator determines that special circumstances require an
extension of time for processing the Claim. If the Administrator determines that
an extension of time for processing is required, notice of the extension shall
be furnished to the Claimant prior to the termination of the initial 90-day
period; however, in no event shall such extension exceed a period of 90 days
from the end of such initial period. Any extension notice shall indicate the
special circumstances requiring an extension of time and the date by which the
Plan expects to render the benefit determination. For purposes of this
Subsection (b), the period of time within which a benefit determination is
required to be made shall begin at the time a Claim is filed in accordance with
the procedures set forth in this Subsection (b), without regard to whether all
the information necessary to make a benefit determination accompanies such
filing.

(2)

Manner and Content of Notification of Benefit Determination. The Administrator
shall provide a Claimant with written or electronic notification of any adverse
benefit determination. Any electronic notification shall comply with the
standards imposed by the Department of Labor. The notification shall set forth,
in a manner calculated to be understood by the Claimant (i) the specific reason
or reasons for the adverse determination, (ii) reference to the specific Plan
provisions on which the determination is based, (iii) 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, and
(iv) a description of the Plan's review procedures and the time limits
applicable to such procedures, including a statement of the Claimant's right to
bring a civil action under ERISA Section 502(a) following an adverse benefit
determination on review.

(c)

Appeal of Adverse Benefit Determination; Full and Fair Review. Within 60 days
after the receipt by the Claimant of the written opinion described in Subsection
(b), the Claimant may request in writing that the Committee review the claim and
the Administrator's initial adverse benefit determination. Such request must be
addressed to the Company at its then principal place of business, and may
include the submission of written comments, documents, records, and other
information relating to the claim for benefits. The Claimant shall be provided,
upon request and free of charge, reasonable access to, and copies of, all
documents, records, and other information relevant to the Claimant's claim for
benefits. The Committee's review shall take into account all comments,
documents, records and other information submitted by the Claimant relating to
the claim, without regard to whether such information was submitted or
considered in the initial benefit determination. If the Claimant does not
request a review of the Administrator's initial determination within such 60 day
period, he shall be barred and estopped from challenging such determination.

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(d)

Notification of Benefit Determination on Review.

(1)

Timing of Notification of Benefit Determination on Review. The Committee shall
notify a Claimant of the Plan's determination of a request for review within a
reasonable period of time, but not later than 60 days after receipt of the
Claimant's request for review by the Plan, unless the Committee determines that
special circumstances require an extension of time for processing the Claim. If
the Committee determines that 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 60-day period. In no event shall such extension
exceed a period of 60 days from the end of the initial 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 determination on review.
For purposes of this Subsection (d), the period of time within which a benefit
determination on review is required to be made shall begin at the time an appeal
is filed in accordance with the procedures set forth in Subsection (c), without
regard to whether all the information necessary to make a benefit determination
on review accompanies such filing. In the event that a period of time is
extended due to a Claimant's failure to submit information necessary to decide a
claim, the period for making the benefit determination on review shall be tolled
from the date on which the notification of the extension is sent to the Claimant
until the date on which the Claimant responds to the request for additional
information.

(2)

Manner and Content of Notification of Benefit Determination on Review. The
Committee shall provide a Claimant with written or electronic notification of a
Plan's benefit determination on review. Any electronic notification shall comply
with the standards imposed by the Department of Labor. In the case of an adverse
benefit determination, the notification shall set forth, in a manner calculated
to be understood by the Claimant (i) the specific reason or reasons for the
adverse determination, (ii) reference to the specific Plan provisions on which
the benefit determination is based, (iii) a statement that the Claimant is
entitled to receive, upon request and free of charge, reasonable access to, and
copies of, all documents, records, and other information relevant to the
Claimant's claim for benefits, and (iv) a statement of the Claimant's right to
bring a civil action under ERISA Section 502(a).

5.04

Expenses. The cost of this Plan and the expenses of administering the Plan shall
be borne by the Employer.

5.05

Compliance with Securities Laws. Notwithstanding anything else to the contrary
contained herein,

(a)

the Section 16 Committee shall have final discretion with respect to the
application, administration and interpretation of the Plan with regard to, and
the deferral of compensation by, any Participant who is a Section 16 Reporting
Person; and

(b)

a Section 16 Reporting Person shall not take any actions or make any elections
under this Plan which could result in short-swing trading liability under
Section 16 of the Exchange Act.

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ARTICLE VI
MISCELLANEOUS

6.01

No Trust Created. Nothing contained in this Plan, and no action taken pursuant
to its provisions by any party shall create, or be construed to create, a trust
of any kind, or a fiduciary relationship between the Employer and the
Participants or their beneficiaries.

6.02

No Requirement to Fund. The Employer is not required to and shall not fund
(within the meaning of the Federal tax laws) this Plan. Even though amounts
deferred under this Plan are credited to the Accounts of the Participants, the
Employer shall not be required to earmark, deposit, contribute to a trust, or
otherwise set aside funds for such Accounts.

6.03

Benefits Payable from General Assets. The benefits payable under this Plan to a
Participant or his or her beneficiary or beneficiaries may be made from the
general assets of the Employer or from such other assets earmarked, deposited,
contributed to a trust, or otherwise set aside to fund benefits under this Plan.
It is intended that the Employer's obligation under this Plan be an unfunded and
unsecured promise to pay money in the future. Any funds earmarked, deposited,
contributed to a trust, or otherwise set aside by the Employer to assist it in
satisfying its obligations under this Plan shall be subject to the claims of
general creditors of the Employer. The Participants' (or their beneficiaries')
rights to benefits under this Plan which are payable by the Employer shall be no
greater than the right of any unsecured general creditor of the Employer, and
the Participants (and their beneficiaries) shall not have any security interest
in any assets (including, but not limited to, assets earmarked, deposited,
contributed to a trust, or otherwise set aside to fund benefits provided under
this Plan) of the Employer.

6.04

Successors. This Plan shall be binding upon the Employer and its successors and
assigns, and the Participant, his or her successors, heirs, executors,
administrators and beneficiaries.

6.05

No Contract of Employment. Nothing contained in this Plan shall be construed to
be a contract of employment or as conferring upon an eligible Non-Employee
Director, Officer or Employee the right to continue to be employed by the
Employer in his or her present capacity, or in any capacity, or any rights as an
officer or director of the Employer.

6.06

Amendment or Termination of Plan. Except to the extent otherwise reserved to the
Administrator, the President or any Vice President or the General Counsel of the
Company (the "Corporate Officers") shall have the right to amend this Plan at
any time and from time to time, including a retroactive amendment. The Committee
expressly reserves the right to terminate the Plan and to amend Sections 1.05,
1.08, 1.09, 1.10, 1.11, 1.12, 1.13, 1.14, 1.16, 1.18, 1.19, 1.27, 1.28, 1.29,
1.30, 2.01, 3.01, 4.01, 4.03, 4.04, 6.02, 6.03, and 6.06 hereof and shall have
the right to amend any such section or sections at any time or from time to
time, including a retroactive amendment. No amendment or termination of the Plan
shall, without the consent of any person affected thereby, modify or in any way
affect any right or obligation under this Plan created prior to such amendment
or termination.

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6.07

Top Hat Plan. It is the Employer's intention that this Plan be construed as an
unfunded, non-qualified deferred compensation plan maintained for a select group
of management or highly compensated employees within the meaning of ERISA Sec.
201(2).

6.08

Governing Law. The validity and effect of this Plan and the rights and
obligations of all persons affected hereby shall be construed and determined in
accordance with the laws of the State of Florida unless superseded by federal
law.

6.09

Severability. In the event that any provision of this Plan shall be declared
illegal or invalid for any reason, said illegality or invalidity shall not
affect the remaining provisions of this Plan but shall be fully severable and
this Plan shall be construed and enforced as if said illegal or invalid
provisions had never been inserted herein.

6.10

Construction. The article and section headings and numbers are included only for
convenience of reference and are not to be taken as limiting or extending the
meaning of any of the terms and provisions of the Plan. Whenever appropriate,
words used in the singular shall include the plural or the plural may be read as
the singular.

6.11

Merger or Consolidation or Sale of Assets of Employer. Subject to the
requirement that the Employer make distributions upon termination of a
Participant's employment following a Change of Control pursuant to Section 4.04,
in the event of the merger or consolidation of the Employer with any other
entity, or in the event substantially all of the assets of the Employer are to
be transferred to another entity, the successor entity resulting from the merger
or consolidation, or the transferee of such assets, as the case may be, shall
assume the obligations of the Employer hereunder and shall be substituted for
the Employer hereunder.

6.12

Transfer to an Affiliate of the Employer. An election to defer Base Salary,
Bonuses, LTIP Awards, and/or Director's Fees under this Plan shall apply with
respect to such items of compensation paid by a Participant's Employer at the
time such deferral election is properly made. In the event the Participant has a
deferral election in effect and transfers from one subsidiary or affiliate of
the Employer to another subsidiary or affiliate of the Employer, the new
Employer shall to the extent possible continue to comply with such deferral
election (and the other related administrative elections). As soon as
administratively practicable, the Administrator shall notify such new Employer
of the Participant's elections in effect and shall make available copies of the
relevant forms on which such elections were made.

6.13

Assignment

. No right, title or interest of any kind in the Plan shall be transferable or
assignable by a Participant or beneficiary or be subject to alienation,
anticipation, encumbrance, garnishment, attachment, execution or levy or any
kind, whether voluntary or involuntary nor subject to the debts, contracts,
liabilities, engagements, or torts of a Participant or beneficiary, except as
provided by Sections 4.06 and 4.07. Except as provided in this Section, any
attempt to alienate, sell, transfer, assign, pledge, garnish, attach or
otherwise subject to legal or equitable process or encumber or dispose of any
interest in the Plan shall be void.

-19-

6.14

Incapacity

. If the Administrator determines that any person to whom any distribution is
payable under this Plan is unable to care for his or her affairs because of
illness or accident, or is a minor, any payment due (unless a prior claim
thereto has been made by a duly appointed guardian, committee or other legal
representative) may be paid to the spouse, a child, a parent, or a brother or
sister, or to any person deemed by the Administrator to have incurred expense
for such person otherwise entitled to payment, in such manner as the
Administrator may determine. Any such payment shall be a complete discharge of
the liabilities of the Employer under this Plan.

6.15

Effect on Benefits Under Other Plans. Any Base Salary, Bonuses, LTIP Award,
and/or Director's Fees deferred hereunder and any benefits payable under this
Plan shall not be considered salary or other compensation to the Participant for
the purposes of computing benefits to which he or she may be entitled under any
other employee benefit plan established or maintained by the Employer, except to
the extent provided in such other employee benefit plan.

6.16

Indemnity Upon Change of Control. If upon a Change of Control it becomes
necessary for a Participant (or his or her beneficiary or beneficiaries) to
institute a claim, by litigation or otherwise, to enforce his or her rights
under this Plan, the Employer (and its successors or transferee in accordance
with Section ) shall indemnify such Participant (or his or her beneficiary or
beneficiaries) from and against all costs and expenses, including legal fees,
incurred by him or her in instituting and maintaining such claim.

6.17

No Rights as Stockholders. No Participant who elects to defer compensation into
a Phantom Stock Account or the Company Stock Fund will have any rights arising
out of the ownership of Common Stock as a result of such election.

IN WITNESS WHEREOF the Committee has caused this Plan to be signed by a duly
appointed officer of the Company and the Company's corporate seal to be hereunto
affixed as of this 20th day of December, 2002.

ATTEST:

FPL GROUP, INC.

By:

Dennis P. Coyle, General Counsel and Secretary

(Seal)

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