ALL OR A PORTION OF THE AMOUNTS PREVIOUSLY
EARNED UNDER THE FOLLOWING PLANS (EACH A "PRIOR PLAN"):
(I) THE CINERGY CORP.
DIRECTORS' DEFERRED COMPENSATION PLAN AND (II) LTIP AWARDS PREVIOUSLY DEFERRED
THROUGH FREESTANDING DEFERRAL AGREEMENTS (AND NOT YET DISTRIBUTED) BY
PARTICIPANTS WHO PREVIOUSLY WERE ON THE BOARD OF DIRECTORS OF CINERGY CORP.
AMOUNTS THAT WERE PREVIOUSLY PAYABLE UNDER THE PRIOR PLANS AND THAT HAVE BEEN
CREDITED TO ACCOUNTS HEREUNDER SHALL REMAIN SUBJECT TO THE SAME VESTING SCHEDULE
AND ELECTIONS (INCLUDING DEFERRAL AND DISTRIBUTION ELECTIONS) AND BENEFICIARY
DESIGNATIONS THAT WERE CONTROLLING UNDER THE APPLICABLE PRIOR PLAN IMMEDIATELY
PRIOR TO THE DATE SUCH AMOUNTS WERE CREDITED TO ACCOUNTS UNDER THE PLAN UNTIL A
NEW ELECTION IS MADE IN ACCORDANCE WITH THE TERMS OF THIS PLAN THAT BY ITS TERMS
SUPERSEDES THE PRIOR ELECTION.
THIS PLAN SHALL RECOGNIZE ANY AMOUNT THAT WAS
PROPERLY DEFERRED BY A PARTICIPANT UNDER A PRIOR PLAN BUT THAT HAD NOT YET BEEN
CREDITED TO HIS OR HER ACCOUNT THEREUNDER AS OF THE DATE THE OBLIGATIONS UNDER
SUCH PLAN WERE ASSUMED BY THIS PLAN.
EACH PARTICIPANT'S RIGHT TO RECEIVE ANY
BENEFIT THAT HAS BEEN TRANSFERRED TO THIS PLAN SHALL BE DETERMINED SOLELY
PURSUANT TO THE TERMS OF THIS PLAN.
ALL OF THE COMPANY'S OBLIGATIONS AND
PARTICIPANTS' RIGHTS WITH RESPECT TO THE AMOUNTS PREVIOUSLY PAYABLE UNDER THE
PRIOR PLAN SHALL AUTOMATICALLY BE EXTINGUISHED AND BECOME OBLIGATIONS AND RIGHTS
UNDER THIS PLAN WITHOUT FURTHER ACTION AS OF THE EFFECTIVE DATE.
4.2
APPLICATION OF CODE SECTION 409A TO PRIOR PLANS.
(A)
PRE-2005 DEFERRALS.
ANY "AMOUNTS DEFERRED" IN TAXABLE YEARS
BEGINNING BEFORE JANUARY 1, 2005 UNDER THE PLAN OR PRIOR PLAN, WITHIN THE
MEANING OF SECTION 409A OF THE CODE, AND ANY EARNINGS THEREON ("PRE-2005
DEFERRALS"), SHALL BE GOVERNED BY THE TERMS OF THE PLAN OR PRIOR PLAN, AS
APPLICABLE, AS IN EFFECT ON OCTOBER 3, 2004, AND IT IS INTENDED THAT SUCH
AMOUNTS AND ANY EARNINGS THEREON BE EXEMPT FROM THE APPLICATION OF SECTION 409A
OF THE CODE.
NOTHING CONTAINED HEREIN IS INTENDED TO MATERIALLY ENHANCE A
BENEFIT OR RIGHT EXISTING UNDER THE PLAN OR PRIOR PLAN AS OF OCTOBER 3, 2004 OR
ADD A NEW MATERIAL BENEFIT OR RIGHT TO SUCH PLAN OR PRIOR PLAN.
(B)
POST-2004 DEFERRALS.
ANY "AMOUNTS DEFERRED" IN TAXABLE YEARS
BEGINNING ON OR AFTER JANUARY 1, 2005 UNDER THE PLAN OR PRIOR PLAN, WITHIN THE
MEANING OF SECTION 409A OF THE CODE, AND ANY EARNINGS THEREON ("POST-2004
DEFERRALS"), SHALL BE GOVERNED BY THE TERMS AND CONDITIONS OF THE PLAN.
4.3
MAINTENANCE OF PARTICIPANT ACCOUNTS.
AN ACCOUNT SHALL BE
ESTABLISHED AND MAINTAINED WITH RESPECT TO EACH PARTICIPANT.
EACH ACCOUNT SHALL
REFLECT THE AMOUNTS CREDITED THERETO PURSUANT TO ARTICLE IV, PLUS OR MINUS
ADJUSTMENTS MADE IN ACCORDANCE WITH THE PROVISIONS OF ARTICLE IV AND REDUCED BY
DISTRIBUTIONS MADE IN ACCORDANCE WITH ARTICLE VI.
4.4
PHANTOM INVESTMENT OPTIONS GENERALLY.
IN ACCORDANCE WITH SUCH
RULES AS THE COMMITTEE SHALL APPROVE, INVESTMENT OPTIONS SHALL BE AVAILABLE
HEREUNDER THAT GENERALLY CORRESPOND WITH EACH RSP INVESTMENT OPTION AND SUCH
OTHER INVESTMENT OPTIONS AS ARE