Exhibit 10.1





 


UNITED STATES DISTRICT COURT


NORTHERN DISTRICT OF ILLINOIS


EASTERN DIVISION





 


	UNITED STATES OF AMERICA	)	 
	 	)	No.
	            v.	)	Hon.
	 	)	 
	COMMONWEALTH EDISON	)	 
	COMPANY	)	 


 





DEFERRED PROSECUTION AGREEMENT


 


This Deferred Prosecution
Agreement between the United States Attorney for the Northern District of Illinois, JOHN R. LAUSCH, JR. (the “government”),
and defendant COMMONWEALTH EDISON COMPANY (“ComEd”), by its undersigned representative and attorneys, pursuant to authority
granted by the Board of Directors of Exelon Corporation (“Exelon”), is made pursuant to the terms and conditions set
forth below.


 


Criminal Information and Acceptance
of Responsibility


 


1.            ComEd
acknowledges and agrees that the government will file the accompanying Information in the United States District Court for the
Northern District of Illinois charging ComEd with bribery in violation of Title 18, United States Code, Section 666(a)(2).
ComEd knowingly waives any right to indictment on this charge, as well as all rights to a speedy trial pursuant to the Sixth Amendment
to the United States Constitution, Title 18, United States Code, Section 3161, and Federal Rule of Criminal Procedure
48(b).


 


2.            ComEd
admits, accepts, and acknowledges that it is responsible under United States law for the acts of its current and former officers,
employees, and agents as charged in the Information and as set forth in the Statement of Facts, attached as Attachment A and incorporated
by reference into this Agreement, and that the facts alleged in the Information and described in the Statement of Facts are true
and accurate. Should the government pursue the prosecution that is deferred by this Agreement, ComEd agrees that it will neither
contest the admissibility of nor contradict the Statement of Facts in any such proceeding, including any trial, guilty plea or
sentencing proceeding.


 






    	 



     


    

 


3.            It
is further understood that the government shall file this Agreement in a public Court file and may disclose this Agreement to the
public.


 


Term of the Agreement


 


4.            This
Agreement shall have a term of three (3) years from the date on which the fully-executed Agreement is filed with the Court
(the “Term”), except for specific provisions below that specify a longer period. ComEd agrees, however, that in the
event the government determines, in its sole discretion, that ComEd has knowingly violated any provision of this Agreement or has
failed to completely perform or fulfill each of its obligations under this Agreement, an extension or extensions of the Term may
be imposed by the government, in its sole discretion, for up to a total additional time period of one year, without prejudice to
the government’s right to proceed as provided in the breach provisions of this Agreement below. Any extension of the Agreement
extends all terms of this Agreement, including the terms of the reporting requirement in Attachment C, for an equivalent period.
Conversely, in the event the government finds, in its sole discretion, that there exists a change in circumstances sufficient to
eliminate the need for the reporting requirement in Attachment C, the Agreement may be terminated early. In such event, ComEd’s
cooperation obligations described below shall survive until the date upon which all such investigations and prosecutions are concluded.


 






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Relevant Considerations


 


5.            The
government enters into this Agreement based on the individual facts and circumstances presented by this case, including the nature
and seriousness of the offense conduct, ComEd’s timely notification to the government of an internal investigation after
receiving a subpoena and being notified by the government of the nature of the government’s investigation, ComEd’s
ongoing cooperation described more fully below, and its remedial measures and operational improvements also described more fully
below.


 





Cooperation


 


6.            To
date, ComEd has provided substantial cooperation, which includes: conducting a thorough and expedited internal investigation; proactively
identifying issues and facts that would likely be of interest to the government; making regular factual presentations to the government
and sharing information that would not have been otherwise available to the government; and organizing voluminous evidence and
information for the government.


 


7.            ComEd
shall continue to cooperate fully with the government in any and all matters relating to the conduct described in this Agreement
and the attached Statement of Facts and other related conduct under investigation by the government at any time during the Term,
until the later of the date the Term ends or the date upon which all investigations and prosecutions arising out of such conduct
are concluded. At the request of the government, ComEd shall also cooperate fully with other law enforcement and regulatory authorities
and agencies in any investigation of ComEd, its subsidiaries or affiliates, or any of its present or former officers, directors,
employees, agents, lobbyists and consultants, or any other party, in any and all matters relating to the conduct described in this
Agreement and the attached Statement of Facts and other related conduct under investigation by the government at any time during
the Term. ComEd’s cooperation pursuant to this paragraph is subject to applicable law and regulations, as well as valid claims
of attorney-client privilege or attorney work product doctrine; however, ComEd must provide to the government a log of any information
or cooperation that is not provided based on an assertion of law, regulation, privilege, or attorney work product, and ComEd bears
the burden of establishing the validity of any such an assertion. ComEd agrees that its cooperation shall include, but not be limited
to, the following:






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a.            ComEd
shall fully and truthfully cooperate in any matter in which it is called upon to cooperate by a representative of the United States
Attorney’s Office for the Northern District of Illinois.


 


b.            ComEd
shall truthfully and in a timely manner disclose all factual information with respect to its activities, those of its subsidiaries
and affiliates, and those of its present and former directors, officers, employees, agents, lobbyists and consultants, including
any evidence or allegations and internal or external investigations, about which the government may inquire. This obligation of
truthful disclosure includes, but is not limited to, the obligation of ComEd to promptly provide to the government, upon request,
any non-privileged document, record or other tangible evidence about which the government may inquire.


 


c.            Upon
request of the government, ComEd shall designate knowledgeable employees, agents or attorneys to provide to the government the
information and materials described above on behalf of ComEd. It is further understood that ComEd must at all times provide complete,
truthful, and accurate information.


 






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d.            ComEd
shall use its best efforts to make available for interviews or testimony, as requested by the government, present or former officers,
directors, employees, agents, lobbyists and consultants of ComEd. This obligation includes, but is not limited to, sworn testimony
before a federal grand jury or in federal trials, as well as interviews with law enforcement and regulatory authorities. Cooperation
shall include identification of witnesses who, to the knowledge of ComEd, may have material information regarding the matters under
investigation.








 


e.            With
respect to any information, testimony, documents, records or other tangible evidence provided to the government pursuant to this
Agreement, ComEd consents to any and all disclosures to other governmental authorities of such materials as the government, in
its sole discretion, shall deem appropriate.


 


f.            Should
ComEd learn of any evidence or allegation of a violation of U.S. criminal law, ComEd shall promptly report such evidence or allegation
to the government. On the date that the Term expires, ComEd, by its Chief Executive Officer and Chief Financial Officer, will certify
to the government that ComEd has met its disclosure obligations pursuant to this Agreement. Each certification will be deemed a
material statement and representation by ComEd to the executive branch of the United States for purposes of 18 U.S.C. § 1001.


 






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8.            ComEd
agrees that its obligations to cooperate under the terms set forth in this Agreement will continue even after the three-year term
of this Agreement and the dismissal of the Information, and ComEd will continue to fulfill the cooperation obligations set forth
in this Agreement in connection with any related investigation, criminal prosecution, or civil proceeding brought by the government
related to the conduct set forth in the Information or the Statement of Facts.


 





Payment of Monetary Penalty


 


9.            The
government and ComEd agree that the application of the 2018 U.S. Sentencing Guidelines (“Guidelines”) to determine
the applicable fine range yields the following:


 


		a.	Offense level. Based upon Guidelines § 2C1.1, the total offense level is 44, calculated as follows:



 





	(a)(2) Base Offense Level	12
	 	 
	(b)(1) More than one bribe	+2
	 	 
	(b)(2) Value of the benefit to be received was greater than $150,000,000	+26
	 	 
	(b)(3) Involvement of an elected public official in a high-level decision-making or sensitive position	+4
	 	 
	TOTAL	44






 


		b.	Base
fine. Based upon Guidelines § 8C2.4, the base fine is $150,000,000.



 


		c.	Culpability score. Based upon Guidelines § 8C2.5, the Culpability Score is 8, calculated
as follows:



 


	(a) Base Culpability Score	5



 






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	(b) ComEd had more than 5000 employees, and high-level personnel participated in and condoned the offense	+5
	 	 
	(g)(2) ComEd fully cooperated in the investigation and clearly demonstrated acceptance of responsibility	-2
	 	 
	TOTAL	8







 


		d.	Calculation of Fine Range. Based upon Guidelines § 8C2.6, the fine range is calculated
as follows:



 





	Base fine	$150,000,000
	Minimum multiplier	1.6
	Maximum multiplier	3.2
	 	 
	Fine range	$240,000,000 - $480,000,000




 





10.          The
government and ComEd agree, based on the application of the Guidelines, that the appropriate total criminal penalty is $200,000,000.
This reflects a discount off the bottom of the applicable United States Sentencing Guidelines fine range for ComEd’s substantial
remediation and cooperation as set forth in this Agreement. ComEd shall be responsible for paying $100,000,000 to the United States
Treasury within thirty (30) days of the filing of this Agreement and the remaining $100,000,000 within ninety (90) days of the
filing of this Agreement. Nothing in the Agreement shall be deemed an agreement regarding a maximum penalty that may be imposed
in any future prosecution, and the government is not precluded from arguing in any future prosecution that the Court should impose
a higher fine, disgorgement or civil or criminal forfeiture, although the government agrees that under those circumstances, it
will recommend to the Court that any amount paid under this Agreement should be offset against any fine imposed as part of a future
judgment. ComEd agrees that no tax deduction may be sought in connection with the payment of any part of the fine, and ComEd may
not seek to recover any portion of the fine through surcharges, fees or any other charges to customers. ComEd shall not seek or
accept directly or indirectly reimbursement or indemnification from any source other than Exelon with regard to the fine amount
or any other amount it pays pursuant to any other agreement entered into with an enforcement authority or regulator concerning
the facts set forth in the Statement of Facts.


 






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11.          The
government agrees, except as provided in this Agreement, that it will not bring any criminal or civil case (except for criminal
tax violations, as to which the government does not make any agreement) against ComEd or any of its present or former subsidiaries
or affiliates relating to any of the conduct described in the attached Statement of Facts or in the documents produced by ComEd
to the government during the investigation, or to conduct otherwise disclosed to the government by ComEd in the investigation or
to conduct known to the government as of the date of this Agreement. The government, however, may use any information related to
the conduct described in the attached Statement of Facts against ComEd: (a) in a prosecution for perjury or obstruction of
justice; (b) in a prosecution for making a false statement; or (c) in a prosecution or other proceeding relating to a
violation of any provision of Title 26 of the United States Code. This Agreement does not provide any protection against prosecution
for any future conduct by ComEd or any of its present or former parents or subsidiaries. In addition, this Agreement does not provide
any protection against prosecution of any individuals, regardless of their affiliation with ComEd or with any of its present or
former parents or subsidiaries.


 






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Remediation, Corporate Compliance
Program, and Reporting


 


12.          ComEd
and Exelon have engaged in significant remedial measures to enhance their compliance program, including taking steps to ensure
that employees and vendors ComEd identified as responsible for the conduct at issue are no longer employed by or have a relationship
with ComEd; revamping the compliance structure including through the creation of the new position of Executive Vice President for
Compliance and Audit with a direct reporting line to the Audit Committee of the Exelon Board of Directors and Chief Executive Officer;
and drafting and implementing new compliance policies that, among other things: (a) require internal tracking and reporting
of anything of value requested, solicited, or provided to public officials, including hiring requests; (b) establish due diligence
and ongoing monitoring requirements for all third parties engaged in political consulting or lobbying activities; (c) prohibit
subcontracting of third party lobbyists and political consultants; (d) mandate that the hiring of all third party lobbyists
and political consultants must be approved by the Chief Compliance and Ethics Officer; and (e) require ongoing monitoring
of all third party lobbyists and political consultants to ensure they are providing value to the business.








 


13.          ComEd
represents that it has implemented and will continue to implement a compliance and ethics program designed to prevent and detect
violations of U.S. law throughout its operations, including those of its subsidiaries, agents, and joint ventures, and those of
its contractors and subcontractors (to the extent subcontractors are permitted) whose responsibilities include accounting, financial
reporting, lobbying, government relations, consulting, and interactions with ComEd’s auditors, including, but not limited
to, the minimum elements set forth in Attachment B (Corporate Compliance Program). In addition, ComEd agrees that it will report
to the government annually during the Term regarding remediation and implementation of the compliance measures described in Attachment
B. These reports will be prepared in accordance with Attachment C (Corporate Compliance Reporting).








 






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14.          To
address any compliance deficiencies, ComEd represents that it has undertaken, and will continue to undertake in the future, in
a manner consistent with all of its obligations under this Agreement, a review of its existing internal controls, policies, and
procedures regarding compliance with U.S. law. Where necessary and appropriate, ComEd agrees to adopt a new compliance program,
or to modify its existing one, including internal controls, compliance policies, and procedures to ensure that it maintains a rigorous
compliance program that incorporates relevant internal controls, as well as policies and procedures designed to effectively deter
and detect violations of U.S. law. The compliance program will include, but not be limited to, the minimum elements set forth in
Attachment B.


 


Deferred Prosecution


 


15.           In
consideration of: (a) ComEd’s past and future cooperation as described above; (b) ComEd’s payment of a monetary
penalty of $200,000,000; (c) ComEd’s adoption and maintenance of remedial measures, and review and audit of such measures,
including the compliance undertakings described in Attachment B, the government agrees to request that the United States District
Court for the Northern District of Illinois defer proceedings on the charge in the Information pursuant to Title 18, United States
Code, Section 3161(h)(2), for the Term of this Agreement.


 






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16.          The
government further agrees that if ComEd fully complies with all of its obligations under this Agreement, the government will not
continue the criminal prosecution against ComEd described in Paragraph 1. Within thirty (30) days of the successful completion
of the Term, the government shall seek dismissal of the Information filed against ComEd.


 








Breach of the Agreement


 


17.          If,
during the Term, (a) ComEd commits any felony under U.S. law; (b) ComEd provides in connection with this Agreement deliberately
false, incomplete, or misleading information, including in connection with a disclosure of information about individual culpability;
(c) ComEd fails to implement a compliance program as set forth in this Agreement and Attachment B; or (d) ComEd otherwise
fails to completely perform or fulfill each of its obligations under the Agreement; or if at any time ComEd fails to cooperate
as set forth in this Agreement regardless of whether the government becomes aware of such a breach after the Term is complete,
ComEd shall thereafter be subject to prosecution for any federal criminal violation of which the government has knowledge, including,
but not limited to, the conduct described in the attached Statement of Facts, which may be pursued by the government in the U.S.
District Court for the Northern District of Illinois or any other appropriate venue. Determination of whether ComEd has breached
the Agreement and whether to pursue prosecution of ComEd shall be in the government’s sole discretion. Any such prosecution
may be premised on information provided by ComEd or its personnel. Any such prosecution relating to the conduct described in the
attached Statement of Facts or relating to conduct known to the government prior to the date on which this Agreement was signed
that is not time-barred by the applicable statute of limitations on the date of the signing of this Agreement may be commenced
against ComEd or its subsidiaries, notwithstanding the expiration of the statute of limitations, between the signing of this Agreement
and the expiration of the Term plus one year. Thus, by signing this Agreement, ComEd agrees that the statute of limitations with
respect to any such prosecution that is not time-barred on the date of the signing of this Agreement shall be tolled for the Term
plus one year. In addition, ComEd agrees that the statute of limitations as to any violation of U.S. law that occurs during the
Term will be tolled from the date upon which the violation occurs until the earlier of the date upon which the government is made
aware of the violation or the duration of the Term plus five years, and that this period shall be excluded from any calculation
of time for purposes of the application of the statute of limitations.


 






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18.          In
the event the government determines that ComEd has breached this Agreement, the government agrees to provide ComEd with written
notice of such breach prior to instituting any prosecution resulting from such breach. Within thirty (30) days of receipt of such
notice, ComEd shall have the opportunity to respond to the government in writing to explain the nature and circumstances of such
breach, as well as the actions ComEd has taken to address and remediate the situation, which explanation the government shall consider
in determining whether to pursue prosecution of ComEd.


 


19.          In
the event that the government determines that ComEd has breached this Agreement: (a) all statements made by or on behalf of
ComEd or its present or former parents or subsidiaries to the government or to the Court, including the attached Statement of Facts,
and any testimony given by ComEd or its present or former parents or subsidiaries before a grand jury, a court, or any tribunal,
or at any legislative hearings, whether prior or subsequent to this Agreement, and any leads or evidence derived from such statements
or testimony, shall be admissible in evidence in any and all criminal proceedings brought by the government against ComEd or its
present or former parents or subsidiaries; and (b) ComEd or its present or former parents or subsidiaries shall not assert
any claim under the United States Constitution, Rule 11(f) of the Federal Rules of Criminal Procedure, Rule 410
of the Federal Rules of Evidence, or any other federal rule that any such statements or testimony made by or on behalf
of ComEd or its present or former parents or subsidiaries prior or subsequent to this Agreement, or any leads or evidence derived
therefrom, should be suppressed or are otherwise inadmissible. The decision whether conduct or statements of any current director,
officer or employee, or any person acting on behalf of, or at the direction of, ComEd or its present or former parents or subsidiaries,
will be imputed to ComEd for the purpose of determining whether ComEd has violated any provision of this Agreement shall be in
the sole discretion of the government.


 






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Statements by ComEd


 


20.          ComEd
expressly agrees that it shall not, through present or future attorneys, officers, directors, employees, agents or any other person
authorized to speak for ComEd, make any public statement, in litigation or otherwise, contradicting the acceptance of responsibility
by ComEd set forth above or the facts described in the attached Statement of Facts. ComEd agrees that if it or any of its present
or former parents or subsidiaries issues a press release or holds any press conference in connection with this Agreement, ComEd
shall first consult the government to determine (a) whether the text of the release or proposed statements at the press conference
are true and accurate with respect to matters relating to this Agreement; and (b) whether the government has any objection
to the release.


 






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Limitations on Binding Effect of Agreement


 


21.            This
Agreement is binding on ComEd and the government but specifically does not bind (i) any component of the Department of Justice
other than the United States Attorney’s Office for the Northern District of Illinois, (ii) other federal agencies, (iii) any
state, local or foreign law enforcement or regulatory agencies, or (iv) any other authorities, although the government will
bring the cooperation of ComEd and its compliance with its obligations under this Agreement to the attention of such agencies and
authorities if requested to do so by ComEd.


 


Changes in Corporate Form


 


22.            Except
as may otherwise be agreed by the government and ComEd in connection with a particular transaction, ComEd agrees that in the event
that, during the term of any of its obligations under this Agreement, it undertakes any change in corporate form, including if
it sells, merges, or transfers business operations that are material to ComEd’s consolidated operations, as they exist as
of the date of this Agreement, whether such change is structured as a sale, asset sale, merger, transfer, or other change in corporate
form, it shall include in any contract for sale, merger, transfer, or other change in corporate form a provision binding the purchaser,
or any successor in interest thereto, to the obligations described in this Agreement. The purchaser or successor in interest must
also agree in writing that the government’s ability to determine there has been a breach under this Agreement is applicable
in full force to that entity. ComEd agrees that the failure to include this Agreement’s breach provisions in the transaction
will make any such transaction null and void. ComEd shall provide notice to the government at least thirty (30) days prior to undertaking
any such sale, merger, transfer, or other change in corporate form. The government shall notify ComEd prior to such transaction
(or series of transactions) if it determines that the transaction(s) will have the effect of circumventing or frustrating
the enforcement purposes of this Agreement. If at any time during the Term ComEd engages in a transaction(s) that has the
effect of circumventing or frustrating the enforcement purposes of this Agreement, the government may deem it a breach of this
Agreement pursuant to the breach provisions of this Agreement. Nothing herein shall restrict ComEd from indemnifying (or otherwise
holding harmless) the purchaser or successor in interest for penalties or other costs arising from any conduct that may have occurred
prior to the date of the transaction, so long as such indemnification does not have the effect of circumventing or frustrating
the enforcement purposes of this Agreement, as determined by the government.


 






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Notice


 


23.            Any
notice to the government under this Agreement shall be given by personal delivery, overnight delivery by a recognized delivery
service, or registered or certified mail, addressed to the Chief, Public Corruption and Organized Crime Section, United States
Attorney’s Office, 219 South Dearborn Street, Fifth Floor, Chicago, IL 60604. Any notice to ComEd shall be given by
personal delivery, overnight delivery by a recognized delivery service, or registered or certified mail, addressed to Charles B.
Sklarsky, Jenner & Block LLP, 353 North Clark Street, Chicago, IL 60654.


 


Complete Agreement


 


24.            This
Agreement sets forth all the terms of the agreement between ComEd and the government. No amendments, modifications or additions
to this Agreement shall be valid unless they are in writing and signed by the government, the attorneys for ComEd, and a duly authorized
representative of ComEd.


 






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	Date: July 16, 2020	BY:	/s/John R. Lausch, Jr. 	 
	 	 	JOHN R. LAUSCH, JR.
	 	 	United States Attorney
	 	 	Northern District of Illinois
	 	 	 
	 	 	AMARJEET S. BHACHU
	 	 	Chief, Public Corruption and
	 	 	Organized Crime Section
	 	 	Northern District of Illinois
	 	 	 
	 	 	DIANE MacARTHUR
	 	 	TIMOTHY J. CHAPMAN
	 	 	Senior Litigation Counsel
	 	 	Northern District of Illinois
	 	 	 
	 	 	SARAH E. STREICKER
	 	 	Deputy Chief, Public Corruption and
	 	 	Organized Crime Section
	 	 	Northern District of Illinois
	 	 	 
	 	 	MATTHEW L. KUTCHER
	 	 	Deputy Chief, General Crimes
	 	 	Section
	 	 	Northern District of Illinois
	 	 	 
	 	 	MICHELLE KRAMER
	 	 	Assistant United States Attorney
		 	Northern
District of Illinois



 






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AGREED AND CONSENTED TO:


 


COMMONWEALTH EDISON COMPANY


 


	Date:	July 16, 2020	 	BY:	/s/David A. Glockner	 
	 	 	DAVID A. GLOCKNER
	 	 	Executive Vice President for
	 	 	Compliance and Audit
	 	 	Exelon Corporation
	 	 	 
	Date:	July 16, 2020	 	BY:	/s/Reid J. Schar	 
	 	 	REID J. SCHAR
	 	 	Jenner & Block LLP
	 	 	Counsel for Commonwealth Edison
	 	 	Company
	 	 	 
	Date:	July 16, 2020	 	BY:	/s/Gayle E. Littleton	 
	 	 	GAYLE E. LITTLETON
	 	 	Jenner & Block LLP
	 	 	Counsel for Commonwealth Edison
	 	 	Company




 






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CORPORATE OFFICER’S CERTIFICATE


 


I have read this Agreement
and carefully reviewed every part of it with outside counsel for Commonwealth Edison Company (“ComEd”). I understand
the terms of this Agreement and voluntarily agree, on behalf of ComEd, to each of its terms. Before signing this Agreement, I
consulted outside counsel for ComEd. Counsel fully advised me of the rights of ComEd, of possible defenses, of the Sentencing Guidelines’
provisions, and of the consequences of entering into this Agreement.


 


I have carefully reviewed
the terms of this Agreement with the Exelon Corporation (“Exelon”) Board of Directors. I have advised and caused outside
counsel for ComEd and Exelon to advise the Exelon Board of Directors fully of the rights of ComEd, of possible defenses, of the
Sentencing Guidelines’ provisions, and of the consequences of entering into the Agreement. No promises or inducements have
been made other than those contained in this Agreement. Furthermore, no one has threatened or forced me, or to my knowledge any
person authorizing this Agreement on behalf of ComEd, in any way to enter into this Agreement. I am also satisfied with outside
counsel’s representation in this matter. I certify that I am an officer of Exelon and that I have been duly authorized by
ComEd to execute this Agreement on behalf of ComEd.


 


	Date:	July 16, 2020	 	BY:	/s/David A. Glockner	 
	 	 	 	DAVID A. GLOCKNER
	 	 	 	Executive Vice President for
	 	 	 	Compliance and Audit
	 	 	 	Exelon Corporation




 






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CERTIFICATE OF COUNSEL


 


We are counsel for
Commonwealth Edison Company (“ComEd”) and Exelon Corporation (“Exelon”) in the matter covered by this Agreement.
In connection with such representation, we have examined relevant ComEd and Exelon documents and have discussed the terms of this
Agreement with the Exelon Board of Directors. Based on our review of the foregoing materials and discussions, we are of the opinion
that the representative of ComEd has been duly authorized to enter into this Agreement on behalf of ComEd and that this Agreement
has been duly and validly authorized, executed, and delivered on behalf of ComEd and is a valid and binding obligation of ComEd.
Further, we have carefully reviewed the terms of this Agreement with the Exelon Board of Directors and the Chief Executive Officer
of ComEd. We have fully advised them of the rights of ComEd, of possible defenses, of the Sentencing Guidelines’ provisions
and of the consequences of entering into this Agreement. To our knowledge, the decision of ComEd to enter into this Agreement,
based on the authorization of Exelon’s Board of Directors, is an informed and voluntary one.


 


	Date:	July 16, 2020	 	BY:	/s/Reid J. Schar	 
	 	 	REID J. SCHAR
	 	 	Jenner & Block LLP
	 	 	Counsel for Commonwealth Edison
	 	 	Company
	 	 	 
	Date:	July 16, 2020	 	BY:	/s/Gayle E. Littleton	 
	 	 	GAYLE E. LITTLETON
	 	 	Jenner & Block LLP
	 	 	Counsel for Commonwealth Edison
	 	 	Company




 



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UNITED STATES DISTRICT COURT


NORTHERN
DISTRICT OF ILLINOIS


EASTERN DIVISION


 


	UNITED STATES OF AMERICA	)	 
	 	)	No.
	v.         	)	 
	 	)	 
	COMMONWEALTH EDISON	)	 
	COMPANY	)	 



 


THE
UNITED STATES ATTORNEY charges:


 


1.              At
times material to this information:


 


a.            Defendant
COMMONWEALTH EDISON COMPANY (hereinafter, “ComEd”), with headquarters located in Chicago, was the largest utility
company in Illinois. As a utility, ComEd was subject to extensive regulation by the State of Illinois.


 


b.           The
legislative branch of government for the State of Illinois was commonly known as the Illinois General Assembly. The Illinois General
Assembly was composed of two houses: The House of Representatives and the Senate. The Illinois General Assembly routinely considered
bills and passed legislation that had a substantial impact on ComEd’s operations and profitability, including legislation
that affected the regulatory process used to determine the rates ComEd could charge customers for the delivery of electricity.
ComEd maintained a continuing interest in advancing legislation in the Illinois General Assembly favorable to its interests, and
opposing legislation that was not consistent with its operational and financial success.


 






    


     


    

 


c.            Public
Official A was the Speaker of the House of Representatives and an elected member of that body. As Speaker of the House of Representatives,
Public Official A was able to exercise control over what measures were called for a vote in the House of Representatives. Public
Official A also exercised substantial influence and control over fellow lawmakers concerning legislation, including legislation
affecting ComEd.


 


2.            Beginning
no later than in or around 2011, and continuing through in or around 2019, in the Northern District of Illinois, Eastern Division,
and elsewhere,


 


COMMONWEALTH
EDISON COMPANY,


 


defendant
herein, corruptly gave, offered, and agreed to give things of value, namely, jobs, vendor subcontracts, and monetary payments
associated with those jobs and subcontracts, for the benefit of Public Official A and Public Official A’s associates, with
intent to influence and reward Public Official A, as an agent of the State of Illinois, a State government that during each of
the twelve-month calendar years from 2011 to 2019, received federal benefits in excess of $10,000, in connection with any business,
transaction, and series of transactions of $5,000 or more of the State of Illinois, namely, legislation affecting ComEd and its
business;


 






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In violation
of Title 18, United States Code, Section 666(a)(2).


 


	 		 
	 	UNITED STATES ATTORNEY




 






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ATTACHMENT A


 


STATEMENT OF FACTS


 


The following Statement
of Facts is incorporated by reference as part of the Deferred Prosecution Agreement (the “Agreement”) between the United
States Attorney’s Office for the Northern District of Illinois and Commonwealth Edison Company (“ComEd”). ComEd
hereby agrees and stipulates that the following information is true and accurate. ComEd admits, accepts, and acknowledges that
it is responsible for the acts of its current and former officers, directors, employees, and agents as set forth below.


 


I.             Background


 


ComEd is the largest
utility company in Illinois. It employs over 6,000 individuals, and delivers electricity to approximately 70% of Illinois’s
population. It is a majority-owned subsidiary of Exelon Corporation (“Exelon”), and operates from its headquarters
located in Chicago.


 


As a utility, ComEd
is subject to extensive regulation by the State of Illinois. The State of Illinois regulates the rates that ComEd may charge its
customers, as well as the rate of return ComEd may realize from its business operations. The legislative branch of the State of
Illinois, known as the Illinois General Assembly, has routinely considered bills and has passed legislation that has had a substantial
impact on ComEd’s operations and profitability, including legislation that affects the regulatory process ComEd uses to determine
the rates ComEd charges its customers for the delivery of electricity. In order for legislation to become law, it must be passed
by both houses of the Illinois General Assembly—the Illinois House of Representatives and the Illinois Senate.


 






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For example, in 2011,
the General Assembly passed the Energy Infrastructure and Modernization Act (“EIMA”). EIMA provided for a regulatory
process through which ComEd was able to more reliably determine rates it could charge customers and, in turn, determine how much
money it was able to generate from its operations to cover, among other things, costs for grid-infrastructure improvements. The
passage of EIMA therefore helped improve ComEd’s financial stability. EIMA was passed by the Illinois House of Representatives
in or around May 2011, and by the Illinois Senate in or around August 2011. EIMA was then vetoed by the Governor of the
State of Illinois. Thereafter, in or around October 2011, both houses of the Illinois General Assembly voted to override the
Governor’s veto. In 2016, the General Assembly passed the Future Energy Jobs Act (“FEJA”), which provided for
a renewal of the regulatory process that was beneficial to ComEd. Since the passage of FEJA, ComEd has had a continuing interest
in advancing legislation in the General Assembly favorable to its interests, and opposing legislation that was not consistent with
its operational and financial success.


 


Public Official A is
the Speaker of the Illinois House of Representatives and the longest serving member of the House of Representatives. ComEd understood
that, as Speaker of the House of Representatives, Public Official A was able to exercise control over what measures were called
for a vote in the House of Representatives and had substantial influence and control over fellow lawmakers concerning legislation,
including legislation that affected ComEd. Public Official A was an agent of the State of Illinois, a State government that during
each of the twelve-month calendar years from 2011 to 2019, received federal benefits in excess of $10,000.


 






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Individual A served
in the Illinois House of Representatives for approximately ten years beginning in 1972. After Individual A’s service in the
Illinois House of Representatives, Individual A served as a lobbyist and/or consultant for ComEd until 2019. During that time, Individual
A made known to ComEd that Individual A had a close personal relationship with Public Official A.


 


CEO-1 was the chief
executive officer of ComEd between in and around March 2012 and May 2018. From June 1, 2018 to October 15,
2019, CEO-1 served as a senior executive at Exelon Utilities, and had oversight authority over ComEd’s operations.


 


Senior Executive 1
served as ComEd’s senior vice president for legislative and external affairs from in or around March 2012 until in or
around September 2019.


 


Lobbyist 1 served as
ComEd’s executive vice president of legislative and external affairs from in and around 2009 until Lobbyist 1’s retirement
in and around 2012. From 2012 to 2019, Lobbyist 1 served as an external lobbyist for ComEd.


 


Consultant 1 was the
owner of Company 1, which performed consulting services for ComEd until in and around 2019.


 


II.           Conduct


 


Overview


 


From in or around 2011
through in or around 2019, in an effort to influence and reward Public Official A’s efforts, as Speaker of the Illinois House
of Representatives, to assist ComEd with respect to legislation concerning ComEd and its business, ComEd arranged for various associates
of Public Official A, including Public Official A’s political allies and individuals who performed political work for Public
Official A, to obtain jobs, vendor subcontracts, and monetary payments associated with those jobs and subcontracts from ComEd,
even in instances where certain political allies and workers performed little or no work that they were purportedly hired to perform
for ComEd.


 






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Hiring of Public Official A’s Associates
as Vendor “Subcontractors”





Who Performed Little or No Work for ComEd


 


ComEd employees and
agents, including third-party consultants and lobbyists, were subject to Exelon’s Code of Conduct. Exelon’s Code of
Conduct, applicable beginning in 2015, required employees and agents to: (a) “[k]eep accurate and complete records so
all payments are honestly detailed and company funds are not used for unlawful purposes”; (b) “[c]onduct due diligence
on all potential agents, consultants or other business partners”; and (c) “[n]ever use a third party to make payments
or offers that could be improper.” Exelon’s Code of Conduct also prohibited bribery and listed as an example of a prohibited
bribe: “Providing something of value for the benefit of a public official in a position to make a decision that could benefit
the company.”


 


Beginning no later
than in or around 2011, Public Official A and Individual A sought to obtain from ComEd jobs, vendor subcontracts, and monetary
payments associated with those jobs and subcontracts for various associates of Public Official A, such as precinct captains who
operated within Public Official A’s legislative district.


 


In or around 2011, Individual
A and Lobbyist 1 developed a plan to direct money to two of Public Official A’s associates (“Associate 1” and
 “Associate 2”) by having ComEd pay them indirectly as subcontractors to Consultant 1. Payments to Associate 1 and Associate
2, as well as later payments to other subcontracted associates of Public Official A, continued until in or around 2019, even though
those associates did little or no work during that period.


 






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Consultant 1 agreed
in 2011 that Public Official A’s associates would be identified as subcontractors under Consultant 1’s contract and
that ComEd’s payments to Consultant 1 would be increased to cover payments to those subcontractors. Between in or around
2011 and 2019, Consultant 1 executed written contracts and submitted invoices to ComEd that made it falsely appear that the payments
made to Company 1 were all in return for Consultant 1’s advice on “legislative issues” and “legislative
risk management activities,” and other similar matters, when in fact a portion of the compensation paid to Company 1 was
intended for ultimate payment to Public Official A’s associates, who in fact did little or no work for ComEd. Consultant
1 and Company 1 did little, if anything, to direct or supervise the activities of Public Official A’s associates, even though
they were subcontracted under and received payments through Company 1. Moreover, because they were paid indirectly through Company
1, the payments to Public Official A’s associates over the course of approximately eight years were not reflected in the
vendor payment system used by ComEd, and as a result, despite that Public Official A’s associates were subcontracted under
and receiving payments through Company 1, no such payments were identifiable in ComEd’s vendor payment system.


 


Certain senior executives
and agents of ComEd were aware of these payments from their inception until they were discontinued in or around 2019. For example,
in or around May 2018, Public Official A, through Individual A, asked CEO-1 to hire a political ally of Public Official A
who was retiring from the Chicago City Council at the end of the month (“Associate 3”). CEO-1, in coordination with
Senior Executive 1 and Consultant 1, agreed that ComEd would pay Associate 3 approximately $5,000 a month indirectly as a subcontractor
through Company 1. At the time CEO-1 approved this arrangement, CEO-1 was aware that there were other associates of Public Official
A that were paid indirectly as subcontractors through Company 1, which CEO-1 referred to as the “roster.” CEO-1 also
agreed that Public Official A—rather than an officer or employee of ComEd or Company 1—would advise Associate 3 of
this new arrangement. In or around June 2018, Company 1’s contract was revised to include extra funding for the purpose
of paying Associate 3. In seeking to justify the extra funding, Consultant 1 claimed falsely that an additional fee of $5,000 a
month was necessary under Company 1’s contract, in part because of Company 1’s “expanded role with Cook County
Board president’s office and Cook County Commissioners and Department Heads,” when in fact the additional $5,000 a
month in compensation was intended for payment to Associate 3. ComEd approved of the additional payments to Company 1, knowing
they were intended for Associate 3.


 






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Certain senior executives
and agents of ComEd were also aware of the purpose of these payments to Public Official A’s associates, namely, that they
were intended to influence and reward Public Official A in connection with Public Official A’s official duties and to advance
ComEd’s business interests. For example:


 


a.            On
or about May 16, 2018, Individual A explained to Senior Executive 1 why certain individuals were being paid indirectly
through Company 1, by making reference to their utility to Public Official A’s political operation. Individual A identified
Associate 1, one of the several individuals on Company 1’s payroll, as “one of the top three precinct captains”
who also “trains people how to go door to door . . . so just to give you an idea how important the guy is.”


 


b.            On
or about February 7, 2019, Individual A advised Senior Executive 1 about how to present information within ComEd concerning
the renewal of Company 1’s contract for 2019. In the conversation, Individual A advised Senior Executive 1 that, “I
would say to you don’t put anything in writing,” explaining later in the conversation because “all it can do
is hurt ya.” Individual A further advised Senior Executive 1 that, if asked by a ComEd official why Company 1 was being paid,
Senior Executive 1 should explain that the associates of Public Official A were former ward committeemen and aldermen, that it
was a “favor,” and that it would be up to Consultant 1 to prove that Public Official A’s associates performed
work, not ComEd.


 






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c.            On
or about February 11, 2019, Individual A had a conversation with Lobbyist 1, who by that time had retired from ComEd,
but had continued to serve as a paid external lobbyist to ComEd. In discussing how the renewal of Company 1’s contract—which
included significant payments to Company 1 to account for indirect payments to Public Official A’s associates—should
be communicated internally, Individual A said, “We had to hire these guys because [Public Official A] came to us. It’s
just that simple.” Lobbyist 1 agreed, and added, “It’s, it’s clean for all of us.”


 


d.            On
or about February 13, 2019, Consultant 1 advised Senior Executive 1 that Associate 1 and Associate 2 had been made “subcontractors”
of Company 1 at the request of Lobbyist 1, and that Associate 3 was also currently being paid as a “subcontractor.”
Consultant 1 emphasized that he had told no one of the arrangement per instructions previously given to Consultant 1, and cautioned
Senior Executive 1 that ComEd should not tamper with the arrangement because “your money comes from Springfield,” and
that Consultant 1 had “every reason to believe” that Individual A had spoken to Public Official A about the retention
of Public Official A’s associates, and knew Lobbyist 1 had done so. Consultant 1 added that Public Official A’s associates
 “keep their mouth shut, and, you know, so. But, do they do anything for me on a day to day basis? No.” Consultant 1
explained that these payments were made “to keep [Public Official A] happy, I think it’s worth it, because you’d
hear otherwise.”


 






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e.            On
or about March 5, 2019, Individual A and ComEd personnel participated in a meeting during which they discussed Company
1’s contract and why the indirect payments to Public Official A’s associates made under the guise of that contract
should be continued for another year. During that meeting, Individual A explained that for decades, Public Official A had
named individuals to be ComEd employees, such as meter readers, as part of an “old-fashioned patronage system.” In
response, a ComEd employee acknowledged that such hires could be a “chip” used by ComEd. ComEd renewed Company 1’s
contract.


 


f.             On
or about March 6, 2019, Individual A and Lobbyist 1 discussed the renewal of Company 1’s contract. During the conversation,
Lobbyist 1 explained that “with the [Consultant 1] stuff, you got a little leg up,” to which Individual A agreed. Lobbyist
1 later added, “I mean it’s uh, unmentioned, but you know, that which is understood need not be mentioned.” Individual
A responded, “Right. Exactly. Exactly.”


 


Between in and around
2011 and 2019, indirect payments made to Public Official A’s associates—who performed little or no work for ComEd—totaled
approximately $1,324,500. These indirect payments were made not only through Company 1, but through other additional third-party
vendors. As with Company 1, these other third-party vendors entered into contracts with ComEd that noted that the payments made
to these vendors by ComEd were for consulting and related services, when in truth, a substantial portion of the money paid to these
vendors was intended for Public Official A’s associates, who did little or no work for ComEd. These payments, like those
made indirectly through Company 1, were intended to influence and reward Public Official A in connection with the advancement and
passage of legislation favorable to ComEd in the Illinois General Assembly. Prior to ComEd’s discovery of the federal law
enforcement investigation, Public Official A’s and Individual A’s approval was sought by ComEd before payments to certain
of Public Official A’s associates were discontinued, even though these individuals performed little or no work for ComEd.
As with the payments made to Public Official A’s associates through Company 1, despite that Public Official A’s associates
were subcontracted under and receiving payments through these third party vendors, no such payments were identifiable in ComEd’s
vendor payment system. Certain former ComEd executives designed these payment arrangements in part to conceal the size of payments
made to Public Official A’s associates, and to assist ComEd in denying responsibility for oversight of Public Official A’s
associates, who performed little or no work for ComEd.


 






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Appointment of Board Member 1 as Member
of the Board of


 


Directors at the Request of Public Official
A


 


Beginning in or around
2017, Public Official A sought the appointment of an associate to the ComEd Board of Directors (hereinafter referred to as “Board
Member 1”). Public Official A’s request was communicated by Individual A to CEO-1. In or around May 2018, in response
to internal company opposition to the appointment of Board Member 1, CEO-1 asked Individual A if Public Official A would be satisfied
if CEO-1 arranged for Board Member 1 to receive a part-time job that paid an equivalent amount of money to a board member position,
namely, $78,000 a year. Individual A told CEO-1 that Public Official A would appreciate if CEO-1 would “keep pressing”
for the appointment of Board Member 1, and CEO-1 agreed to do so. In or around September 2018, CEO-1 (who by this time had
been promoted to an executive position within Exelon Utilities, in which capacity CEO-1 maintained oversight authority over ComEd)
assured Individual A that CEO-1 was continuing to advocate for the appointment of Board Member 1 made at Public Official A’s
request because “You take good care of me and so does our friend [Public Official A] and I will do the best that I can to,
to take care of you.”


 






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On or about April 25,
2019, CEO-1 advised Individual A by text message, “Just sent out Board approval to appoint [Board Member 1] to ComEd Board.”
The following day, April 26, 2019, ComEd filed a notice with the United States Securities and Exchange Commission stating
that Board Member 1 had served as a director of ComEd since April 2019. Although ComEd and Exelon conducted due diligence
on Board Member 1 and ultimately determined he was qualified for a Board position, no one at ComEd or Exelon recruited Board Member
1 to serve as a director, and ComEd did not interview or vet other outside candidates for the vacant board seat. ComEd appointed
Board Member 1, in part, with the intent to influence and reward Public Official A in connection with Public Official A’s
official duties.


 


Retention of Law Firm A


 


In or around 2011,
ComEd agreed to retain Law Firm A, and entered into a contract pursuant to which ComEd agreed to provide Law Firm A with a minimum
of 850 hours of attorney work per year. This contract was entered into with Law Firm A, in part, with the intent to influence and
reward Public Official A in connection with Public Official A’s official duties and because personnel and agents of ComEd
understood that giving this contract to Law Firm A was important to Public Official A. In 2016, Law Firm A’s contract was
up for renewal. As part of renewal discussions, personnel within ComEd sought to reduce the hours of legal work they provided to
Law Firm A from the 850 hours specified in the 2011 retention agreement because ComEd paid only for hours worked and there was
not enough appropriate legal work to give to Law Firm A to fill 850 annual hours.


 






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Thereafter, an attorney
associated with Law Firm A [Lawyer A] complained to Individual A about ComEd’s effort to reduce the amount of work provided
to Law Firm A. On or about January 20, 2016, Individual A contacted CEO-1 and wrote, “I am sure you know how valuable
[Lawyer A] is to our Friend [Public Official A],” and then went on to write, “I know the drill and so do you. If you
do not get involve [sic] and resolve this issue of 850 hours for his law firm per year then he will go to our Friend [Public Official
A]. Our Friend [Public Official A] will call me and then I will call you. Is this a drill we must go through?” CEO-1 replied
in writing, “Sorry. No one informed me. I am on this.” Thereafter, CEO-1 tasked a ComEd employee, who was assigned
as a “project manager” to assist with the project of obtaining legislative approval of FEJA, to ensure that Law Firm
A’s contract was renewed. The project manager had no oversight authority over ComEd’s legal department and was not
otherwise involved in deciding what legal professionals the legal department retained. The project manager was assigned the task
of ensuring Law Firm A’s contract was renewed because the work provided to Law Firm A was, in part, designed to influence
and reward Public Official A in connection with Public Official A’s official duties, including the promotion and passage
of FEJA. ComEd agreed in or around June 2016 to renew Law Firm A’s contract with substantially reduced annual hours.


 


Internship Program


 


Beginning no later
than 2013, and continuing until in or around 2019, ComEd operated an internship program. As part of the program, ComEd would accept
a specified target number of students who primarily resided in a Chicago ward that Public Official A was associated with (“Public
Official A’s Ward”) and that were recommended to ComEd by associates of Public Official A, including Individual A.
ComEd hired students from Public Official A’s Ward, in part, with the intent to influence and reward Public Official A in
connection with Public Official A’s official duties.


 






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Benefit to ComEd


 


Between in or around
2011 and in or around 2019, during the same time frame that ComEd was making payments to Public Official A’s associates,
and extending other benefits for the purpose of influencing and rewarding Public Official A, ComEd was also seeking Public Official
A’s support for legislation that was beneficial to ComEd, including EIMA and FEJA, that would ensure a continued favorable
rate structure for ComEd. ComEd acknowledges that the reasonably foreseeable anticipated benefits to ComEd of such legislation
exceeded $150,000,000.





 






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ATTACHMENT B


 


CORPORATE COMPLIANCE PROGRAM


 


Recognizing the remedial
measures undertaken by Commonwealth Edison Company (“ComEd”) set forth in the Deferred-Prosecution Agreement, ComEd
agrees to continue to conduct, in a manner consistent with all of its obligations under this Agreement, appropriate reviews of
its existing internal controls, policies, and procedures and to address any deficiencies in its internal controls, compliance code,
policies, and procedures regarding compliance with U.S. law.


 


Where necessary and
appropriate, ComEd agrees to modify its compliance program, including internal controls, compliance policies, and procedures to
ensure that it maintains an effective system of internal accounting controls designed to ensure the making and keeping of fair
and accurate books, records, and accounts, as well as policies and procedures designed to effectively detect and deter violations
of U.S. law. At a minimum, this should include, but not be limited to, the following elements to the extent they are not already
part of ComEd’s existing internal controls, compliance code, policies, and procedures:


 


High-Level Commitment


 


1.            ComEd
will ensure that its directors and senior management provide strong, explicit, and visible support and commitment to its corporate
policy against violations of U.S. law and its compliance code.


 






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Policies and Procedures


 


2.            ComEd
will develop and promulgate a clearly articulated and visible corporate policy against violations of U.S. law, which policy shall
be memorialized in a written compliance code.


 


3.            ComEd
will develop and promulgate compliance policies and procedures designed to reduce the prospect of violations of U.S. law and ComEd’s
compliance code, and ComEd will take appropriate measures to encourage and support the observance of ethics and compliance policies
and procedures against violation of U.S. law by personnel at all levels of ComEd. These policies and procedures shall apply to
all directors, officers, and employees and, where necessary and appropriate, outside parties including consultants and lobbyists
acting on behalf of ComEd. ComEd shall notify all employees that compliance with the policies and procedures is the duty of individuals
at all levels of the company.


 


4.            ComEd
will ensure that it has a system of financial and accounting procedures, including a system of internal controls, reasonably designed
to ensure the maintenance of fair and accurate books, records, and accounts. This system should be designed to provide reasonable
assurances that transactions are recorded as necessary to permit preparation of financial statements in conformity with generally
accepted accounting principles or any other criteria applicable to such statements, and to maintain accountability for assets.


 


Periodic Risk-Based Review


 


5.            ComEd
will develop these compliance policies and procedures on the basis of a periodic risk assessment addressing the individual circumstances
of ComEd.


 


6.            ComEd
shall review these policies and procedures no less than annually and update them as appropriate to ensure their continued effectiveness,
taking into account relevant developments in the field and evolving international and industry standards.


 






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Proper Oversight and Independence


 


7.            ComEd
will assign responsibility to one or more senior corporate executives of ComEd or Exelon for the implementation and oversight of
ComEd’s compliance code, policies, and procedures. Such corporate official(s) shall have the authority to report directly
to independent monitoring bodies, including internal audit, ComEd’s and Exelon Corporation’s (“Exelon’s”)
Board of Directors, or any appropriate committee of either Board of Directors, and shall have an adequate level of autonomy from
management as well as sufficient resources and authority to maintain such autonomy.


 


Training and Guidance


 


8.            ComEd
will implement mechanisms designed to ensure that its compliance code, policies, and procedures are effectively communicated to
all directors, officers, employees, and, where appropriate, agents and business partners including consultants and lobbyists. These
mechanisms shall include: (a) periodic training for all directors and officers, all employees in positions of leadership or
trust, positions that require such training (e.g., internal audit, sales, legal, compliance, finance, and government relations),
and, where appropriate, agents and business partners including consultants and lobbyists; and (b) corresponding certifications
by all such directors, officers, employees, agents, and business partners certifying compliance with the training requirements.


 


9.            ComEd
will maintain, or where necessary establish, an effective system for providing guidance and advice to directors, officers, employees,
and, where necessary and appropriate, agents and business partners including consultants and lobbyists, on complying with ComEd
and Exelon’s compliance code, policies, and procedures, including when they need advice on an urgent basis.


 






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Internal Reporting and Investigation


 


10.          ComEd
will maintain, or where necessary establish, an effective system for internal and, where possible, confidential reporting by, and
protection of, directors, officers, employees, and, where appropriate, agents and business partners including consultants and lobbyists
concerning violations of U.S. law or ComEd’s compliance code, policies, and procedures.


 


11.          ComEd
will maintain, or where necessary establish, an effective and reliable process with sufficient resources for responding to, investigating,
and documenting allegations of violations of U.S. law or ComEd’s compliance code, policies, and procedures.


 


Enforcement and Discipline


 


12.          ComEd
will implement mechanisms designed to effectively enforce its compliance code, policies, and procedures, including appropriately
incentivizing compliance and disciplining violations.


 


13.          ComEd
will institute appropriate disciplinary procedures to address, among other things, violations of U.S. law and ComEd’s compliance
code, policies, and procedures by ComEd’s directors, officers, and employees. Such procedures should be applied consistently
and fairly, regardless of the position held by, or perceived importance of, the director, officer, or employee. ComEd shall implement
procedures to ensure that where misconduct is discovered, reasonable steps are taken to remedy the harm resulting from such misconduct,
and to ensure that appropriate steps are taken to prevent further similar misconduct, including assessing the internal controls,
compliance code, policies, and procedures and making modifications necessary to ensure the overall compliance program is effective.


 






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Mergers and Acquisitions


 


14.          ComEd
will develop and implement policies and procedures for mergers and acquisitions requiring that ComEd conduct appropriate risk-based
due diligence on potential new business entities.


 


15.          ComEd
will ensure that ComEd’s compliance code, policies, and procedures regarding U.S. law apply as quickly as is practicable
to newly acquired businesses or entities merged with ComEd and will promptly train the directors, officers, employees, agents,
and business partners consistent with Paragraph 8 above on ComEd’s compliance code, policies, and procedures.


 


Monitoring and Testing


 


16.          ComEd
will conduct periodic reviews and testing of its compliance code, policies, and procedures designed to evaluate and improve their
effectiveness in preventing and detecting violations of U.S. law and ComEd’s code, policies, and procedures, taking into
account relevant developments in the field and evolving industry standards.


 






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ATTACHMENT C


 


REPORTING REQUIREMENTS


 


Commonwealth Edison
Company (“ComEd”) agrees that it will report to the U.S. Attorney’s Office for the Northern District of Illinois
(the “government”) periodically, at no less than twelve-month intervals during a three-year term, regarding remediation
and implementation of the compliance program and internal controls, policies, and procedures described in Attachment B. During
this three-year period, ComEd shall: (1) conduct an initial review and submit an initial report, and (2) conduct and
prepare at least two follow-up reviews and reports, as described below:


 


a.            By
no later than one year from the date this Agreement is executed, ComEd shall submit to the government a written report setting
forth a complete description of its remediation efforts to date, its proposals reasonably designed to improve its internal controls,
policies, and procedures for ensuring compliance with U.S. law, and the proposed scope of the subsequent reviews. The report shall
be transmitted to:


 


Chief, Public Corruption and Organized Crime Section


U.S. Attorney’s Office for the Northern District
of Illinois


219 South Dearborn Street, Fifth Floor


Chicago, IL 60604


 


ComEd may extend the time period for issuance
of the report with prior written approval of the government.


 


b.            ComEd
shall undertake at least two follow-up reviews and reports, incorporating the views of the government on its prior reviews and
reports, to further monitor and assess whether its policies and procedures are reasonably designed to detect and prevent violations
of U.S. law.


 






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c.            The
first follow-up review and report shall be completed by no later than one year after the initial report is submitted to the government.
The second follow-up review and report shall be completed and delivered to the government no later than thirty days before the
end of the Term.


 


 


d.            The
reports will likely include proprietary, financial, confidential, and competitive business information. Moreover, public disclosure
of the reports could discourage cooperation, impede pending or potential government investigations and thus undermine the objectives
of the reporting requirement. For these reasons, among others, the reports and the contents thereof are intended to remain and
shall remain non-public, except as otherwise agreed to by the parties in writing, or except to the extent that the government determines
in its sole discretion that disclosure would be in furtherance of the government’s discharge of its duties and responsibilities
or is otherwise required by law.


 


e.            ComEd
may extend the time period for submission of any of the follow-up reports with prior written approval of the government.


 






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