Document:

Exhibit 10.5

Exhibit 10.5

NEITHER THIS SECURITY NOR THE SECURITIES INTO WHICH THIS SECURITY IS CONVERTIBLE HAVE BEEN
REGISTERED WITH THE SECURITIES AND EXCHANGE COMMISSION OR THE SECURITIES COMMISSION OF ANY STATE IN
RELIANCE UPON AN EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE
“SECURITIES ACT”), AND, ACCORDINGLY, MAY NOT BE OFFERED OR SOLD EXCEPT PURSUANT TO AN EFFECTIVE
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OR PURSUANT TO AN AVAILABLE EXEMPTION FROM, OR IN A
TRANSACTION NOT SUBJECT TO, THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT AND IN ACCORDANCE
WITH APPLICABLE STATE SECURITIES LAWS AS EVIDENCED BY A LEGAL OPINION OF COUNSEL TO THE TRANSFEROR
TO SUCH EFFECT, THE SUBSTANCE OF WHICH SHALL BE REASONABLY ACCEPTABLE TO THE COMPANY. THIS
SECURITY AND THE SECURITIES ISSUABLE UPON CONVERSION OF THIS SECURITY MAY BE PLEDGED IN CONNECTION
WITH A BONA FIDE MARGIN ACCOUNT OR OTHER LOAN SECURED BY SUCH SECURITIES.

THE SECURITIES REPRESENTED HEREBY ARE SUBJECT TO A SECURED CONVERTIBLE NOTE PURCHASE AGREEMENT,
DATED AS OF AUGUST
 _____, 2009, BY AND BETWEEN THE COMPANY AND THE INVESTOR REFERRED TO THEREIN (THE
“PURCHASE AGREEMENT”), AND BOTH THE COMPANY AND THE HOLDER OF THE NOTE, BY ACCEPTANCE OF THIS NOTE,
AGREE TO BE BOUND BY ALL APPLICABLE PROVISIONS OF THE PURCHASE AGREEMENT.

Original Issue Date: August 25, 2009

Original Conversion Price (subject to adjustment herein): $50

$5,000,000

0% CONVERTIBLE PROMISSORY NOTE

DUE AUGUST 25, 2011

FOR VALUE RECEIVED, Ebix, Inc., a Delaware corporation with its principal place of business at
5 Concourse Parkway, Suite 3200, Atlanta, Georgia 30328 (the “Company”), hereby promises to
pay in lawful money of the United States to the order of Rennes Foundation., a                     
organized under the laws of                      or its registered successors or assigns (the
“Holder”), at the office of the Holder at 5 Concourse Parkway, Suite 3200, Atlanta, GA
30328, or at such other place as the Holder may from time to time designate in writing, (1) the
principal sum of FIVE MILLION AND NO/100 DOLLARS ($5,000,000) on August 25, 2011 (the “Maturity
Date”). This Note is being issued in connection with that certain Secured Convertible Note
Purchase Agreement, dated as of the date hereof, between the Company and the Holder (the
“Purchase Agreement”). This Note is subject to the following additional provisions:

Section 1. Definitions. For the purposes hereof, in addition to the terms
defined elsewhere in this Note, (a) capitalized terms not otherwise defined herein shall have the
meanings set forth in the Purchase Agreement and (b) the following terms shall have the following
meanings:

“Alternate Consideration” shall have the meaning set forth in Section 5(c).

 

 

 

“Bankruptcy Event” means any of the following events: (a) the Company or any
Significant Subsidiary (as such term is defined in Rule 1-02(w) of Regulation S-X) thereof
commences a case or other proceeding under any bankruptcy, reorganization, arrangement,
adjustment of debt, relief of debtors, dissolution, insolvency or liquidation or similar law
of any jurisdiction relating to the Company or any Significant Subsidiary thereof; (b) there
is commenced against the Company or any Significant Subsidiary thereof any such case or
proceeding that is not dismissed within 60 days after commencement; (c) the Company or any
Significant Subsidiary thereof is adjudicated insolvent or bankrupt or any order of relief
or other order approving any such case or proceeding is entered; (d) the Company or any
Significant Subsidiary thereof suffers any appointment of any custodian or the like for it
or any substantial part of its property that is not discharged or stayed within 60 calendar
days after such appointment; (e) the Company or any Significant Subsidiary thereof makes a
general assignment for the benefit of creditors; (f) the Company or any Significant
Subsidiary thereof calls a meeting of its creditors with a view to arranging a composition,
adjustment or restructuring of its debts; or (g) the Company or any Significant Subsidiary
thereof, by any act or failure to act, expressly indicates its consent to, approval of or
acquiescence in any of the foregoing or takes any corporate or other action for the purpose
of effecting any of the foregoing.

“Business Day” means any day except Saturday, Sunday, any day which shall be a
federal legal holiday in the United States or any day on which banking institutions in the
State of New York are authorized or required by law or other governmental action to close.

“Common Stock” means the common stock, par value $.10 per share, of the Company
and stock of any other class of securities into which such securities may hereafter be
reclassified or changed into.

“Common Stock Equivalents” means any securities of the Company or the
Subsidiaries which would entitle the holder thereof to acquire at any time Common Stock,
including, without limitation, any debt, preferred stock, rights, options, warrants or other
instrument that is at any time convertible into or exercisable or exchangeable for, or
otherwise entitles the holder thereof to receive, Common Stock.

“Conversion Date” shall have the meaning set forth in Section 4(a).

“Conversion Price” shall have the meaning set forth in Section 4(b).

“Conversion Shares” means, collectively, the shares of Common Stock issuable
upon conversion of this Note in accordance with the terms hereof.

 

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“Delaware Courts” shall have the meaning set forth in Section 9(d).

“Effective Date” shall mean the effective date of any registration statement
filed with the SEC covering all or such portion of the Conversion Shares as may be specified
in such registration statement.

“Event of Default” shall have the meaning set forth in Section 8.

“Exchange Act” means the Securities Exchange Act of 1934, as amended, and the
rules and regulations promulgated thereunder.

Exempt Issuance” means (a) the vesting of shares of Common Stock or options to
employees, officers, consultants or directors of the Company pursuant to the Company’s 1996
Stock Incentive Plan, as amended (provided that any such vesting shall not exceed 10% of the
Company’s outstanding shares and/or options, in the aggregate, in any twelve-month period),
(b) the issuance of securities upon the exercise or exchange of or conversion of any
securities issued pursuant to the Purchase Agreement and/or other securities exercisable or
exchangeable for or convertible into shares of Common Stock issued and outstanding on the
date of this Agreement, provided that such securities have not been amended since the date
of this Agreement to increase the number of such securities or to decrease the exercise,
exchange or conversion price of such securities, and (c) the issuance of securities issued
pursuant to acquisitions or strategic transactions approved by a majority of the
disinterested directors of the Company, provided any such issuance shall only be to a person
which is, itself or through its subsidiaries, an operating company in a business synergistic
with or complementary to the business of the Company and in which the Company receives
benefits in addition to the investment of funds.

“Fundamental Transaction” shall have the meaning set forth in Section 5(c).

“GAAP” means United States generally accepted accounting principles applied on
a consistent basis during the periods involved.

“Liens” means a lien, charge, security interest, encumbrance, right of first
refusal, preemptive right or other restriction.

“Note Register” shall have the meaning set forth in Section 2(c).

“Notice of Conversion” shall have the meaning set forth in Section 4(a).

 

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“Original Issue Date” means the date of the first issuance of the Notes,
regardless of any transfers of any Note and regardless of the number of instruments which
may be issued to evidence such Notes.

“Permitted Lien” means the individual and collective reference to the
following: (a) Liens for taxes, assessments and other governmental charges or levies not yet
due or Liens for taxes, assessments and other governmental charges or levies being contested
in good faith and by appropriate proceedings for which adequate reserves (in the good faith
judgment of the management of the Company) have been established in accordance with GAAP;
(b) Liens imposed by law which were incurred in the ordinary course of the Company’s
business, such as carriers’, warehousemen’s and mechanics’ Liens, statutory landlords’
Liens, and other similar Liens arising in the ordinary course of the Company’s business, and
which (x) do not individually or in the aggregate materially detract from the value of such
property or assets or materially impair the use thereof in the operation of the business of
the Company and its consolidated Subsidiaries or (y) are being contested in good faith by
appropriate proceedings, which proceedings have the effect of preventing for the foreseeable
future the forfeiture or sale of the property or asset subject to such Lien; (c) Liens
incurred in connection with Permitted Indebtedness.

“Person” means an individual or corporation, partnership, trust, incorporated
or unincorporated association, joint venture, limited liability company, joint stock
company, government (or an agency or subdivision thereof) or other entity of any kind.

“Purchase Agreement” means the Secured Convertible Note Purchase Agreement,
dated as of August
 _____ 
, 2009, between the Company and the original Holder, as the same may
be amended, modified or supplemented from time to time in accordance with its terms.

“Registrable Securities” means (i) all of the shares of Common Stock issuable
upon conversion in full of the Notes, and (ii) any securities issued or issuable upon any
stock split, stock dividend, subsequent rights offering or other distribution,
recapitalization or other transaction set forth in Section 5.

“SEC” shall mean the United States Securities and Exchange Commission.

“SEC Reports” means all reports, schedules, forms, statements and other
documents required to be filed by the Company under the Securities Act and the Exchange Act,
including pursuant to Section 13(a) and 15(d) thereof.

“Securities Act” means the Securities Act of 1933, as amended, and the rules
and regulations promulgated thereunder.

“Share Delivery Date” shall have the meaning set forth in Section 4(d).

 

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“Subsidiary” shall have the meaning set forth in the Purchase Agreement.

“Trading Day” means a day on which the Nasdaq Stock Market (or any Trading
Market on which the Company’s Common Stock is then traded) is open for trading.

“Trading Market” means the following markets or exchanges on which the Common
Stock is listed or quoted for trading on the date in question: the American Stock Exchange,
the Nasdaq Capital Market, the Nasdaq Global Market, the Nasdaq Global Select Market, the
New York Stock Exchange or the OTC Bulletin Board.

“Transaction Documents” shall have the meaning set forth in the Purchase
Agreement.

“VWAP” means, for any date, the price determined by the first of the following
clauses that applies: (a) if the Common Stock is then listed or quoted on a Trading Market,
the daily volume weighted average price of the Common Stock for such date (or the nearest
preceding date) on the Trading Market on which the Common Stock is then listed or quoted for
trading as reported by Bloomberg L.P. (based on a Trading Day from 9:30 a.m. (New York City
time) to 4:02 p.m. (New York City time); (b) if the OTC Bulletin Board is not a Trading
Market, the volume weighted average price of the Common Stock for such date (or the nearest
preceding date) on the OTC Bulletin Board; (c) if the Common Stock is not then quoted for
trading on the OTC Bulletin Board and if prices for the Common Stock are then reported in
the “Pink Sheets” published by Pink Sheets, LLC (or a similar organization or agency
succeeding to its functions of reporting prices), the most recent bid price per share of the
Common Stock so reported; or (d) in all other cases, the fair market value of a share of
Common Stock as determined by an independent appraiser selected in good faith by the Holder
and reasonably acceptable to the Company.

Section 2.
Prepayment. The Company may not prepay any portion of the principal amount
of this Note without the prior written consent of the Holder.

Section 3. Registration of Transfers and Exchanges.

a) Different Denominations. This Note is exchangeable for an equal aggregate
principal amount of Notes of different authorized denominations, as requested by the Holder
surrendering the same. No service charge will be payable for such registration of transfer
or exchange.

b) Investment Representations. This Note has been issued subject to certain
investment representations of the original Holder set forth in the Purchase Agreement and
may be transferred or exchanged only in compliance with the Purchase Agreement and
applicable federal and state securities laws and regulations.

 

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c) Reliance on Note Register. Prior to due presentment for transfer to the
Company of this Note, the Company and any agent of the Company may treat the Person in whose
name this Note is duly registered on the Note Register as the owner hereof for the purpose
of receiving payment as herein provided and for all other purposes, whether or not this Note
is overdue, and neither the Company nor any such agent shall be affected by notice to the
contrary.

Section 4. Conversion.

a) Voluntary Conversion. At any time after the Original Issue Date until this
Note is no longer outstanding, this Note shall be convertible, in whole or in part, into
 shares of Common Stock or into a payment equivalent to the closing price of the shares, that
would have otherwise been issued by the company, on the day that the Holder notifies the
Company in writing about its intent to convert the note or a portion thereof, at the sole
discretion of the Company. The Holder shall effect conversions by delivering to the Company
a Notice of Conversion, the form of which is attached hereto as Annex A (a
“Notice of Conversion”), specifying therein the principal amount of this Note to be
converted and the date on which such conversion shall be effected (such date, the
“Conversion Date”). If no Conversion Date is specified in a Notice of Conversion,
the Conversion Date shall be the date that such Notice of Conversion is deemed delivered
hereunder. To effect conversions hereunder, the Holder shall not be required to physically
surrender this Note to the Company unless the entire principal amount of this Note, has been
so converted. Conversions hereunder shall have the effect of lowering the outstanding
principal amount of this Note in an amount equal to the applicable conversion. The Holder
and the Company shall maintain records showing the principal amount(s) converted and the
date of such conversion(s). The Company may deliver an objection to any Notice of
Conversion within 1 Business Day of delivery of such Notice of Conversion. The Holder, and
any assignee by acceptance of this Note, acknowledges and agrees that, by reason of the
provisions of this paragraph, following conversion of a portion of this Note, the unpaid and
unconverted principal amount of this Note may be less than the amount stated on the face
hereof.

b) Conversion Price. The conversion price in effect on any Conversion Date
shall be equal to $50.00, subject to adjustment as described herein (the “Conversion
Price”).

 

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c) Conversion Limitations. The Company shall not effect any conversion of this
Note, and a Holder shall not have the right to convert any portion of this Note, to the
extent that after giving effect to the conversion set forth on the applicable Notice of
Conversion, such Holder (together with such Holder’s Affiliates, and any other person or
entity acting as a group together with such Holder or any of such Holder’s Affiliates) would
beneficially own in excess of the Beneficial Ownership Limitation (as defined below). For
purposes of the foregoing sentence, the number of shares of Common Stock beneficially owned
by such Holder and its Affiliates shall include the number of shares of Common Stock
issuable upon conversion of this Note with respect to which such
determination is being made, but shall exclude the number of shares of Common Stock
which are issuable upon (A) conversion of the remaining, unconverted principal amount of
this Note beneficially owned by such Holder or any of its Affiliates and (B) exercise or
conversion of the unexercised or unconverted portion of any other securities of the Company
subject to a limitation on conversion or exercise analogous to the limitation contained
herein (including, without limitation, any other Notes) beneficially owned by such Holder or
any of its Affiliates. Except as set forth in the preceding sentence, for purposes of this
Section 4(c), beneficial ownership shall be calculated in accordance with Section 13(d) of
the Exchange Act and the rules and regulations promulgated thereunder. To the extent that
the limitation contained in this Section 4(c) applies, the determination of whether this
Note is convertible (in relation to other securities owned by such Holder together with any
Affiliates) and of which principal amount of this Note is convertible shall be in the sole
discretion of such Holder, and the submission of a Notice of Conversion shall be deemed to
be such Holder’s determination of whether this Note may be converted (in relation to other
securities owned by such Holder together with any Affiliates) and which principal amount of
this Note is convertible, in each case subject to such aggregate percentage limitations. To
ensure compliance with this restriction, each Holder will be deemed to represent to the
Company each time it delivers a Notice of Conversion that such Notice of Conversion has not
violated the restrictions set forth in this paragraph, and the Company shall have no
obligation to verify or confirm the accuracy of such determination. In addition, a
determination as to any “group” status as contemplated above shall be determined in
accordance with Section 13(d) of the Exchange Act and the rules and regulations promulgated
thereunder. For purposes of this Section 4(c), in determining the number of outstanding
 shares of Common Stock, a Holder may rely on the number of outstanding shares of Common
Stock as stated in the most recent of the following: (A) the Company’s most recent Quarterly
Report on Form10-Q or Annual Report on Form 10-K, as the case may be; (B) a more recent
public announcement by the Company; or (C) a more recent notice by the Company or the
Company’s transfer agent setting forth the number of shares of Common Stock outstanding.
Upon the written or oral request of a Holder, the Company shall within two Trading Days
confirm orally and in writing to such Holder the number of shares of Common Stock then
outstanding, in case the company decides to choose the option of converting the note into
 shares of Common stock. In that case, the number of outstanding shares of Common Stock
shall be determined after giving effect to the conversion or exercise of securities of the
Company, including this Note, by such Holder or its Affiliates since the date as of which
such number of outstanding shares of Common Stock was reported. The “Beneficial
Ownership Limitation” shall be 9.99% of the number of shares of the Common Stock
outstanding immediately after giving effect to the issuance of shares of Common Stock
issuable upon conversion of this Note held by the Holder. The Beneficial Ownership
Limitation provisions of this Section 4(c) may be waived by such Holder, at the election of
such Holder, upon not less than 61 days’ prior notice to the Company, to change or eliminate
the Beneficial Ownership Limitation. The limitations contained in this paragraph shall
apply to a successor holder of this Note.

 

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d) Mechanics of Conversion.

i. Conversion Shares Issuable Upon Conversion of Principal Amount. In
case the Company decides to choose the option of converting the note into shares of
Common stock, once it has received a notification from the Holder to convert the
note, then the number of shares of Common Stock issuable upon a conversion hereunder
shall be determined by the quotient obtained by dividing (x) the outstanding
principal amount of this Note to be converted by (y) the Conversion Price.

ii. Delivery of Certificate Upon Conversion. Not later than seven
Trading Days after each Conversion Date (the “Share Delivery Date”), the
Company at its discretion shall either wire payment to the Holder or shall deliver,
or cause to be delivered, to the Holder a certificate or certificates representing
the Conversion Shares which (A) prior to the Effective Date with respect to such
Conversion Shares, shall contain such restrictive legends as may be required
pursuant to the Securities Act and (B) on or after the Effective Date with respect
to such Conversion Shares, shall be free of restrictive legends and trading
restrictions (other than those which may then be required pursuant to the Purchase
Agreement). Such certificate or certificates shall represent the number of shares
of Common Stock being acquired upon the conversion of this Note. On or after the
Effective Date with respect to such Conversion Shares, the Company shall use its
best efforts to deliver any certificate or certificates required to be delivered by
the Company under this Section 4 electronically through the Depository Trust Company
or another established clearing corporation performing similar functions.

iii. Failure to Deliver Certificates or Wire Cash. If in the case of
any Notice of Conversion, neither payment nor such certificate or certificates are
delivered to or as directed by the applicable Holder by the seventh Trading Day
after the Conversion Date, the Holder shall be entitled to elect by written notice
to the Company at any time on or before its receipt of such certificate or
certificates, to rescind such Conversion, in which event the Company shall promptly
return to the Holder any original Note delivered to the Company and the Holder shall
promptly return the Common Stock certificates representing the principal amount of
this Note tendered for conversion to the Company.

iv. Obligation Absolute. The Company’s obligations to issue and
deliver payment or Conversion Shares, at its discretion, upon conversion of this
Note in accordance with the terms hereof is absolute and unconditional, irrespective
of any action or inaction by the Holder to enforce the same, any waiver or consent
with respect to any provision hereof, the recovery of any judgment against any
Person or any action to enforce the same, or any setoff, counterclaim, recoupment,
limitation or termination, or any breach or alleged breach by the Holder or any
other Person of any obligation to the Company or any violation or alleged violation
of law by the Holder or any other Person, and irrespective of any other circumstance
which might otherwise limit such
obligation of the Company to the Holder. Failure to wire payment or deliver
the Conversion Shares upon conversion of this Note in accordance with the terms
hereof shall constitute an Event of Default hereunder.

 

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Section 5. Certain Adjustments.

a) Stock Dividends and Stock Splits. If the Company, at any time while this
Note is outstanding: (A) pays a stock dividend or otherwise makes a distribution or
distributions payable in shares of Common Stock on shares of Common Stock or any Common
Stock Equivalents (which, for avoidance of doubt, shall not include any shares of Common
Stock issued by the Company upon conversion of, or payment of interest on, the Notes); (B)
subdivides outstanding shares of Common Stock into a larger number of shares; (C) combines
(including by way of a reverse stock split) outstanding shares of Common Stock into a
smaller number of shares; or (D) issues, in the event of a reclassification of shares of the
Common Stock, any shares of capital stock of the Company, then the Conversion Price shall be
multiplied by a fraction of which the numerator shall be the number of shares of Common
Stock (excluding any treasury shares of the Company) outstanding immediately prior to such
event and of which the denominator shall be the number of shares of Common Stock outstanding
immediately after such event. Any adjustment made pursuant to this Section shall become
effective immediately after the record date for the determination of shareholders entitled
to receive such dividend or distribution and shall become effective immediately after the
effective date in the case of a subdivision, combination or re-classification.

b) Subsequent Rights Offerings. If the Company, at any time while the Note is
outstanding, shall issue rights, options or warrants to all holders of Common Stock, such
issuance will also be granted to Holders on an as-converted basis without the Holder having
to convert in order to be entitled to such issuance.

c) Fundamental Transaction. If, at any time while this Note is outstanding, (A)
the Company effects any merger or consolidation of the Company with or into another Person,
(B) the Company effects any sale of all or substantially all of its assets in one
transaction or a series of related transactions, (C) any tender offer or exchange offer
(whether by the Company or another Person) is completed pursuant to which holders of Common
Stock are permitted to tender or exchange their shares for other securities, cash or
property, or (D) the Company effects any reclassification of the Common Stock or any
compulsory share exchange pursuant to which the Common Stock is effectively converted into
or exchanged for other securities, cash or property (in any such case, a “Fundamental
Transaction”), then, upon any subsequent conversion of this Note, the Holder shall have
the right to receive, for each Conversion Share that would have been issuable upon such
conversion immediately prior to the occurrence of such Fundamental Transaction, the same
kind and amount of securities, cash or property as it would have been entitled to receive
upon the occurrence of such Fundamental Transaction if it had been, immediately prior to
such Fundamental Transaction, the holder of one (1) share of Common Stock (the
“Alternate Consideration”). For purposes of any such conversion,
the determination of the Conversion Price shall be appropriately adjusted to apply to
such Alternate Consideration based on the amount of Alternate Consideration issuable in
respect of one (1) share of Common Stock in such Fundamental Transaction, and the Company
shall apportion the Conversion Price among the Alternate Consideration in a reasonable
manner reflecting the relative value of any different components of the Alternate
Consideration. If holders of Common Stock are given any choice as to the securities, cash
or property to be received in a Fundamental Transaction, then the Holder shall be given the
same choice as to the Alternate Consideration it receives upon any conversion of this Note
following such Fundamental Transaction. To the extent necessary to effectuate the foregoing
provisions, any successor to the Company or surviving entity in such Fundamental Transaction
shall issue to the Holder a new Note consistent with the foregoing provisions and evidencing
the Holder’s right to convert such Note into Alternate Consideration. The terms of any
agreement pursuant to which a Fundamental Transaction is effected shall include terms
requiring any such successor or surviving entity to comply with the provisions of this
Section 5(c) and ensuring that this Note (or any such replacement security) will be
similarly adjusted upon any subsequent transaction analogous to a Fundamental Transaction.

 

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d) Calculations. All calculations under this Section 5 shall be made to the
nearest cent or the nearest 1/100th of a share, as the case may be. For purposes of this
Section 5, the number of shares of Common Stock deemed to be issued and outstanding as of a
given date shall be the sum of the number of shares of Common Stock (excluding any treasury
 shares of the Company) issued and outstanding.

e) Notice to the Holder.

i. Adjustment to Conversion Price. Whenever the Conversion Price is
adjusted pursuant to any provision of this Section 5, the Company shall promptly
mail to each Holder a notice setting forth the Conversion Price after such
adjustment and setting forth a brief statement of the facts requiring such
adjustment.

Section 6. Events of Default.

a) “Event of Default” means, wherever used herein, any of the following events
(whatever the reason for such event and whether such event shall be voluntary or involuntary
or effected by operation of law or pursuant to any judgment, decree or order of any court,
or any order, rule or regulation of any administrative or governmental body):

i. any default in the payment of (A) the principal amount of any Note or (B)
liquidated damages and other amounts owing to a Holder on any Note, as and when the
same shall become due and payable (whether on a Conversion Date or the Maturity Date
or by acceleration or otherwise) which default, in the case of a principal payment
or other default under (A) above or other default under clause (B) above, is not
cured within 7 Trading Days;

ii. the Company shall fail to observe or perform any other covenant or
agreement contained in the Notes (other than a breach by the Company of its
obligations to wire payment or deliver shares of Common Stock to the Holder upon
conversion, which breach is addressed in clause (x) below) which failure is not
cured, if possible to cure, within the earlier to occur of (A) 10 Trading Days after
notice of such failure sent by the Holder or by any other Holder and (B) 15 Trading
Days after the Company has become or should have become aware of such failure;

 

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iii. a default or event of default by the Company shall occur under (A) any of
the Transaction Documents or (B) any other material agreement, lease, document or
instrument to which the Company or any Subsidiary is obligated (and not covered by
clause (vi) below), which default is not cured, if possible to cure, within the
lesser of (a) thirty days from such default or event of default or (b) such lesser
period as may be provided in the applicable agreement, document or instrument);

iv. any representation or warranty made in this Note, any other Transaction
Documents, any written statement pursuant hereto or thereto or any other report,
financial statement or certificate made or delivered to the Holder or any other
Holder shall be untrue or incorrect in any material respect as of the date when made
or deemed made;

v. the Company or any Subsidiary shall be subject to a Bankruptcy Event;

vi. the Common Stock shall not be eligible for listing or quotation for trading
on a Trading Market and shall not be eligible to resume listing or quotation for
trading thereon within sixty Trading Days;

vii. the Company shall fail for any reason to wire payment or deliver
certificates to a Holder prior to the seventh Trading Day after a Conversion Date or
the Company shall provide at any time notice to the Holder, including by way of
public announcement, of the Company’s intention to not honor requests for
conversions of any Notes in accordance with the terms hereof.

b) Remedies Upon Event of Default. If any Event of Default shall have occurred,
at the Holder’s election, (i) the outstanding principal amount of this Note, liquidated
damages and other amounts owing in respect thereof through the date of acceleration, shall
become immediately due and payable in cash at the Mandatory Default Amount or (ii)
commencing 15 days after the occurrence of any Event of Default that results in the eventual
acceleration of this Note, the interest rate on this Note shall accrue at an interest rate
equal to the lesser of 8% per annum or the maximum rate permitted under applicable law.
Upon the payment in full of the Mandatory Default Amount, the Holder shall promptly
surrender this Note to or as directed by the Company. In connection with such acceleration
described herein, the Holder need not provide, and the
Company hereby waives, any presentment, demand, protest or other notice of any kind,
and the Holder may immediately and without expiration of any grace period enforce any and
all of its rights and remedies hereunder and all other remedies available to it under
applicable law. Such acceleration may be rescinded and annulled by Holder at any time prior
to payment hereunder and the Holder shall have all rights as a holder of the Note until such
time, if any, as the Holder receives full payment. No such rescission or annulment shall
affect any subsequent Event of Default or impair any right consequent thereon.

 

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Section 7. Miscellaneous.

a) Notices. Any and all notices or other communications or deliveries to be
provided by the Holder hereunder, including, without limitation, any Notice of Conversion,
shall be in writing and delivered personally, by facsimile, or sent by a nationally
recognized overnight courier service, addressed to the Company, at the address set forth
above, facsimile number (678) 281-2019, Attention: Robin Raina or such other facsimile
number or address as the Company may specify for such purpose by notice to the Holder
delivered in accordance with this Section 9(a). Any and all notices or other communications
or deliveries to be provided by the Company hereunder shall be in writing and delivered
personally, by facsimile, or sent by a nationally recognized overnight courier service
addressed to each Holder at the facsimile number or address of such Holder appearing on the
books of the Company, or if no such facsimile number or address appears, at the principal
place of business of the Holder. Any notice or other communication or deliveries hereunder
shall be deemed given and effective on the earliest of (i) the date of transmission, if such
notice or communication is delivered via facsimile at the facsimile number specified in this
Section prior to 5:30 p.m. (Atlanta time), (ii) the date immediately following the date of
transmission, if such notice or communication is delivered via facsimile at the facsimile
number specified in this Section between 5:30 p.m. (Atlanta time) and 11:59 p.m. (Atlanta
time) on any date, (iii) the second Business Day following the date of mailing, if sent by
nationally recognized overnight courier service, or (iv) upon actual receipt by the party to
whom such notice is required to be given.

b) Absolute Obligation. Except as expressly provided herein, no provision of
this Note shall alter or impair the obligation of the Company, which is absolute and
unconditional, to pay the principal as applicable, on this Note at the time, place, and
rate, and in the coin or currency, herein prescribed. This Note is a direct debt obligation
of the Company.

c) Lost or Mutilated Note. If this Note shall be mutilated, lost, stolen or
destroyed, the Company shall execute and deliver, in exchange and substitution for and upon
cancellation of a mutilated Note, or in lieu of or in substitution for a lost, stolen or
destroyed Note, a new Note for the principal amount of this Note so mutilated, lost, stolen
or destroyed, but only upon receipt of evidence of such loss, theft or destruction of such
Note, and of the ownership hereof, reasonably satisfactory to the Company.

 

12

 

d) Governing Law. All questions concerning the construction, validity,
enforcement and interpretation of this Note shall be governed by and construed and enforced
in accordance with the internal laws of the State of Delaware, without regard to the
principles of conflict of laws thereof. Each party agrees that all legal proceedings
concerning the interpretation, enforcement and defense of the transactions contemplated by
any of the Transaction Documents (whether brought against a party hereto or its respective
Affiliates, directors, officers, shareholders, employees or agents) shall be commenced in
the state and federal courts sitting in Dover, Delaware (the “Delaware Courts”).
Each party hereto hereby irrevocably submits to the exclusive jurisdiction of the Delaware
Courts for the adjudication of any dispute hereunder or in connection herewith or with any
transaction contemplated hereby or discussed herein (including with respect to the
enforcement of any of the Transaction Documents), and hereby irrevocably waives, and agrees
not to assert in any suit, action or proceeding, any claim that it is not personally subject
to the jurisdiction of such Delaware Courts, or such Delaware Courts are improper or
inconvenient venue for such proceeding. Each party hereto hereby irrevocably waives, to the
fullest extent permitted by applicable law, any and all right to trial by jury in any legal
proceeding arising out of or relating to this Note or the transactions contemplated hereby.
If either party shall commence an action or proceeding to enforce any provisions of this
Note, then the prevailing party in such action or proceeding shall be reimbursed by the
other party for its attorneys fees and other costs and expenses incurred in the
investigation, preparation and prosecution of such action or proceeding.

e) Waiver. Any waiver by the Company or the Holder of a breach of any
provision of this Note shall not operate as or be construed to be a waiver of any other
breach of such provision or of any breach of any other provision of this Note. The failure
of the Company or the Holder to insist upon strict adherence to any term of this Note on one
or more occasions shall not be considered a waiver or deprive that party of the right
thereafter to insist upon strict adherence to that term or any other term of this Note. Any
waiver by the Company or the Holder must be in writing.

f) Severability. If any provision of this Note is invalid, illegal or
unenforceable, the balance of this Note shall remain in effect, and if any provision is
inapplicable to any Person or circumstance, it shall nevertheless remain applicable to all
other Persons and circumstances. If it shall be found that any interest or other amount
deemed interest due hereunder violates the applicable law governing usury, the applicable
rate of interest due hereunder shall automatically be lowered to equal the maximum rate of
interest permitted under applicable law. The Company covenants (to the extent that it may
lawfully do so) that it shall not at any time insist upon, plead, or in any manner
whatsoever claim or take the benefit or advantage of, any stay, extension or usury law or
other law which would prohibit or forgive the Company from paying all or any portion of the
principal of or interest on this Note as contemplated herein, wherever enacted, now or at
any time hereafter in force, or which may affect the covenants or the performance of this
indenture, and the Company (to the extent it may lawfully do so) hereby expressly waives all
benefits or advantage of any such law, and covenants that it will not, by resort
to any such law, hinder, delay or impeded the execution of any power herein granted to
the Holder, but will suffer and permit the execution of every such as though no such law has
been enacted.

 

13

 

g) Next Business Day. Whenever any payment or other obligation hereunder shall
be due on a day other than a Business Day, such payment shall be made on the next succeeding
Business Day.

h) Headings. The headings contained herein are for convenience only, do not
constitute a part of this Note and shall not be deemed to limit or affect any of the
provisions hereof.

i) Assumption. Any successor to the Company or any surviving entity in a
Fundamental Transaction shall (i) assume, prior to such Fundamental Transaction, all of the
obligations of the Company under this Note and the other Transaction Documents pursuant to
written agreements in form and substance satisfactory to the Holder (such approval not to be
unreasonably withheld or delayed) and (ii) issue to the Holder a new Note of such successor
entity evidenced by a written instrument substantially similar in form and substance to this
Note, including, without limitation, having a principal amount and interest rate equal to
the principal amount and the interest rate of this Note and having similar ranking to this
Note, which shall be satisfactory to the Holder (any such approval not to be unreasonably
withheld or delayed). The provisions of this Section 9(i) shall apply similarly and equally
to successive Fundamental Transactions and shall be applied without regard to any
limitations of this Note.

*********************

 

14

 

IN WITNESS WHEREOF, the Company has caused this Note to be duly executed by a duly authorized
officer as of the date first above indicated.

	 	 	 	 	 
	 	EBIX, INC.

 	 
	 	By:  	/s/ Robin Raina
 	 
	 	 	Name:  	Robin Raina 	 
	 	 	Title:  	President & Chief Executive Officer 	 

 

15

 

ANNEX A

NOTICE OF CONVERSION

The undersigned hereby elects to convert principal under the 0% Convertible Note due August
25, 2011 of Ebix, Inc., a Delaware corporation (the “Company”), and the Company at its
discretion needs to issue either shares of common stock, par value $.10 per share (the “Common
Stock”) or a payment amount equivalent to the closing prices of the shares that would have been
issued by the Company, according to the conditions hereof, as of the date written below. If shares
of Common Stock are to be issued in the name of a person other than the undersigned, the
undersigned will pay all transfer taxes payable with respect thereto and is delivering herewith
such certificates and opinions as reasonably requested by the Company in accordance therewith. No
fee will be charged to the holder for any conversion, except for such transfer taxes, if any.

By the delivery of this Notice of Conversion the undersigned represents and warrants to the
Company that its ownership of the Common Stock does not exceed the amounts specified under Section
4 of this Note, as determined in accordance with Section 13(d) of the Exchange Act.

The undersigned agrees to comply with the prospectus delivery requirements under the
applicable securities laws in connection with any transfer of the aforesaid shares of Common Stock.

Conversion calculations:

	 	 	 
	 

	 	Date to Effect Conversion:                    
	 
	 	 
	 

	 	Principal Amount of Note to be Converted:                    
	 
	 	 
	 

	 	Number of shares of Common Stock to be issued:
	 
	 	 
	 

	 	OR
	 
	 	 
	 

	 	Amount to be paid by Company to Holder                     
	 
	 	 
	 

	 	Signature:
	 
	 	 
	 

	 	Name:
	 
	 	 
	 

	 	Address:

 

A-1

 

Schedule 1

CONVERSION SCHEDULE

The 0% Convertible Notes due on August                     , 2009 in the aggregate principal amount of
$5,000,000 are issued by Ebix, Inc. This Conversion Schedule reflects conversions made under
Section 4 of the above referenced Note.

Dated:

	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	Aggregate	 	 	 	 
	 	 	 	 	 	 	Principal	 	 	 	 
	 	 	 	 	 	 	Amount	 	 	 	 
	 	 	 	 	 	 	Remaining	 	 	 	 
	 	 	 	 	 	 	Subsequent to	 	 	 	 
	 	 	 	 	 	 	Conversion	 	 	 	 
	Date of Conversion	 	 	 	 	 	(or original	 	 	 	 
	(or for first entry,	 	Amount of	 	 	Principal	 	 	 	 
	Original Issue Date)	 	Conversion	 	 	Amount)	 	 	Company Attestexv4w1

Exhibit 4.1

DUKE ENERGY CORPORATION

TO

THE BANK OF NEW YORK MELLON TRUST COMPANY, N.A.

Trustee

 

Third Supplemental Indenture

Dated as of August 28, 2009

 

$500,000,000 3.95% SENIOR NOTES DUE 2014

$500,000,000 5.05% SENIOR NOTES DUE 2019

 

 

TABLE OF CONTENTS1

	 	 	 	 	 
	ARTICLE I

	 
	 	 	 	 
	3.95% SENIOR NOTES DUE 2014

	 
	 	 	 	 
	Section 1.01. Establishment
	 	 	1	 
	Section 1.02. Definitions
	 	 	2	 
	Section 1.03. Payment of Principal and Interest
	 	 	2	 
	Section 1.04. Denominations
	 	 	3	 
	Section 1.05. Global Securities
	 	 	3	 
	Section 1.06. Redemption
	 	 	4	 
	Section 1.07. Paying Agent
	 	 	5	 
	 
	 	 	 	 
	ARTICLE II

	 
	 	 	 	 
	5.05% SENIOR NOTES DUE 2019

	 
	 	 	 	 
	Section 2.01. Establishment
	 	 	5	 
	Section 2.02. Definitions
	 	 	5	 
	Section 2.03. Payment of Principal and Interest
	 	 	6	 
	Section 2.04. Denominations
	 	 	7	 
	Section 2.05. Global Securities
	 	 	7	 
	Section 2.06. Redemption
	 	 	7	 
	Section 2.07. Paying Agent
	 	 	8	 
	 
	 	 	 	 
	ARTICLE III

	 
	 	 	 	 
	MISCELLANEOUS PROVISIONS

	 
	 	 	 	 
	Section 3.01. Recitals by the Corporation
	 	 	9	 
	Section 3.02. Ratification and Incorporation of Original Indenture
	 	 	9	 
	Section 3.03. Executed in Counterparts
	 	 	9	 
	 
	 	 	 	 
	Exhibit A — Form of 3.95% Senior Note Due 2014
	 	 	 	 
	Exhibit B — Certificate of Authentication
	 	 	 	 
	Exhibit C — Form of 5.05% Senior Note Due 2019
	 	 	 	 
	Exhibit D — Certificate of Authentication
	 	 	 	 

 

			
	1	 	This Table of Contents does not constitute part of the
Indenture or have any bearing upon the interpretation of any of its terms and
provisions.

i 

 

     THIS THIRD SUPPLEMENTAL INDENTURE is made as of the 28th day of August 2009, by and between
DUKE ENERGY CORPORATION, a Delaware corporation, having its principal office at 526 South Church
Street, Charlotte, North Carolina 28202 (the “Corporation”), and The Bank of New York Mellon Trust
Company, N.A. (formerly known as The Bank of New York Trust Company, N.A.), a national banking
association, as Trustee (herein called the “Trustee”).

WITNESSETH:

     WHEREAS, the Corporation has heretofore entered into an Indenture, dated as of June 3, 2008
(the “Original Indenture”), with The Bank of New York Mellon Trust Company, N.A., as Trustee;

     WHEREAS, the Original Indenture is incorporated herein by this reference and the Original
Indenture, as it may be amended and supplemented to the date hereof, including by this Third
Supplemental Indenture, is herein called the “Indenture”;

     WHEREAS, under the Indenture, a new series of Securities may at any time be established in
accordance with the provisions of the Indenture and the terms of such series may be described by a
supplemental indenture executed by the Corporation and the Trustee;

     WHEREAS, the Corporation hereby proposes to create under the Indenture two additional series
of Securities;

     WHEREAS, additional Securities of other series hereafter established, except as may be limited
in the Indenture as at the time supplemented and modified, may be issued from time to time pursuant
to the Indenture as at the time supplemented and modified; and

     WHEREAS, all conditions necessary to authorize the execution and delivery of this Third
Supplemental Indenture and to make it a valid and binding obligation of the Corporation have been
done or performed.

     NOW, THEREFORE, in consideration of the agreements and obligations set forth herein and for
other good and valuable consideration, the sufficiency of which is hereby acknowledged, the parties
hereto hereby agree as follows:

ARTICLE I

3.95% SENIOR NOTES DUE 2014

     Section 1.01. Establishment. There is hereby established a new series of Securities
to be issued under the Indenture, to be designated as the Corporation’s 3.95% Senior Notes due 2014
(the “2014 Notes”).

     There are to be authenticated and delivered $500,000,000 principal amount of the 2014 Notes,
and no further 2014 Notes shall be authenticated and delivered except as provided by Section 304,
305, 306, 906 or 1106 of the Original Indenture and the last paragraph of Section 301 thereof. The
2014 Notes shall be issued in fully registered form without coupons.

 

 

     The 2014 Notes shall be in substantially the form set out in Exhibit A hereto, and the form of
the Trustee’s Certificate of Authentication for the 2014 Notes shall be in substantially the form
set forth in Exhibit B hereto.

     Each 2014 Note shall be dated the date of authentication thereof and shall bear interest from
the date of original issuance thereof or from the most recent Interest Payment Date to which
interest has been paid or duly provided for.

     Section 1.02. Definitions. The following defined terms used in this Article 1 shall,
unless the context otherwise requires, have the meanings specified below for purposes of the 2014
Notes. Capitalized terms used herein for which no definition is provided herein shall have the
meanings set forth in the Original Indenture.

     “Business Day” means any day other than a Saturday or a Sunday, that is neither a Legal
Holiday nor a day on which banking institutions in New York, New York are authorized or required by
law, regulation or executive order to close or a day on which the Corporate Trust Office is closed
for business.

     “Interest Payment Date” means each March 15 and September 15 of each year, commencing March
15, 2010.

     “Legal Holiday” means any day that is a legal holiday in New York, New York.

     “Original Issue Date” means August 28, 2009.

     “Regular Record Date” means, with respect to each Interest Payment Date, the close of business
on the 15th calendar day prior to such Interest Payment Date (whether or not a Business Day).

     “Stated Maturity” means September 15, 2014.

     Section 1.03. Payment of Principal and Interest. The principal of the 2014 Notes
shall be due at Stated Maturity (unless earlier redeemed). The unpaid principal amount of the 2014
Notes shall bear interest at the rate of 3.95% per annum until paid or duly provided for, such
interest to accrue from August 28, 2009 or from the most recent Interest Payment Date to which
interest has been paid or duly provided for. Interest shall be paid semi-annually in arrears on
each Interest Payment Date to the Person or Persons in whose name the 2014 Notes are registered on
the Regular Record Date for such Interest Payment Date; provided that interest payable at the
Stated Maturity or on a Redemption Date as provided herein shall be paid to the Person to whom
principal is payable. Any such interest that is not so punctually paid or duly provided for shall
forthwith cease to be payable to the Holders on such Regular Record Date and may either be paid to
the Person or Persons in whose name the 2014 Notes are registered at the close of business on a
Special Record Date for the payment of such defaulted interest to be fixed by the Trustee (“Special
Record Date”), notice whereof shall be given to Holders of the 2014 Notes not less than ten (10)
days prior to such Special Record Date, or be paid at any time in any other lawful manner not
inconsistent with the requirements of any securities exchange, if any, on

2

 

which the 2014 Notes may be listed, and upon such notice as may be required by any such
exchange, all as more fully provided in the Original Indenture.

     Payments of interest on the 2014 Notes shall include interest accrued to but excluding the
respective Interest Payment Dates. Interest payments for the 2014 Notes shall be computed and paid
on the basis of a 360-day year of twelve 30-day months. In the event that any date on which
interest is payable on the 2014 Notes is not a Business Day, then payment of the interest payable
on such date shall be made on the next succeeding day that is a Business Day (and without any
interest or payment in respect of any such delay) with the same force and effect as if made on the
date the payment was originally payable.

     Payment of principal of, premium, if any, and interest on the 2014 Notes shall be made in such
coin or currency of the United States of America as at the time of payment is legal tender for
payment of public and private debts. Payments of principal of, premium, if any, and interest on
2014 Notes represented by a Global Security shall be made by wire transfer of immediately available
funds to the Holder of such Global Security, provided that, in the case of payments of principal
and premium, if any, such Global Security is first surrendered to the Paying Agent. If any of the
2014 Notes are no longer represented by a Global Security, (i) payments of principal, premium, if
any, and interest due at the Stated Maturity or earlier redemption of such 2014 Notes shall be made
at the office of the Paying Agent upon surrender of such 2014 Notes to the Paying Agent and (ii)
payments of interest shall be made, at the option of the Corporation, subject to such surrender
where applicable, (A) by check mailed to the address of the Person entitled thereto as such address
shall appear in the Security Register or (B) by wire transfer at such place and to such account at
a banking institution in the United States as may be designated in writing to the Trustee at least
sixteen (16) days prior to the date for payment by the Person entitled thereto.

     Section 1.04. Denominations. The 2014 Notes shall be issued in denominations of
$2,000 or any integral multiple of $1,000 in excess thereof.

     Section 1.05. Global Securities. The 2014 Notes shall initially be issued in the form
of one or more Global Securities registered in the name of the Depositary (which initially shall be
The Depository Trust Company) or its nominee. Except under the limited circumstances described
below, 2014 Notes represented by such Global Security or Global Securities shall not be
exchangeable for, and shall not otherwise be issuable as, 2014 Notes in definitive form. The
Global Securities described in this Article 1 may not be transferred except by the Depositary to a
nominee of the Depositary or by a nominee of the Depositary to the Depositary or another nominee of
the Depositary or to a successor Depositary or its nominee.

     A Global Security shall be exchangeable for 2014 Notes registered in the names of persons
other than the Depositary or its nominee only if (i) the Depositary notifies the Corporation that
it is unwilling or unable to continue as a Depositary for such Global Security and no successor
Depositary shall have been appointed by the Corporation within 90 days of receipt by the
Corporation of such notification, or if at any time the Depositary ceases to be a clearing agency
registered under the Exchange Act at a time when the Depositary is required to be so registered to
act as such Depositary and no successor Depositary shall have been appointed by the Corporation
within 90 days after it becomes aware of such cessation, (ii) an Event of

3

 

Default has occurred and is continuing with respect to the 2014 Notes and beneficial owners of
a majority in aggregate principal amount of the 2014 Notes represented by Global Securities advise
the Depositary to cease acting as Depositary, or (iii) the Corporation in its sole discretion, and
subject to the procedures of the Depositary, determines that such Global Security shall be so
exchangeable. Any Global Security that is exchangeable pursuant to the preceding sentence shall be
exchangeable for 2014 Notes registered in such names as the Depositary shall direct.

     Section 1.06. Redemption. The 2014 Notes shall be redeemable, in whole or from time
to time in part, at the option of the Corporation on any date (a “Redemption Date”), at a
Redemption Price equal to the greater of (i) 100% of the principal amount of the 2014 Notes to be
redeemed and (ii) the sum of the present values of the remaining scheduled payments of principal
and interest thereon (exclusive of interest accrued to such Redemption Date) discounted to such
Redemption Date on a semi-annual basis (assuming a 360-day year consisting of twelve 30-day months)
at the Treasury Rate plus 25 basis points, plus, in either case, accrued and unpaid interest on the
principal amount being redeemed to such Redemption Date.

     “Treasury Rate” means, with respect to any Redemption Date for the 2014 Notes, the rate per
annum equal to the semi-annual equivalent yield to maturity or interpolated maturity (on a day
count basis) of the applicable Comparable Treasury Issue, assuming a price for such Comparable
Treasury Issue (expressed as a percentage of its principal amount) equal to the applicable
Comparable Treasury Price for such Redemption Date. The Treasury Rate shall be calculated on the
third Business Day preceding the Redemption Date.

     “Comparable Treasury Issue” when used in this Section 1.06 means the United States Treasury
security selected by the Quotation Agent as having an actual or interpolated maturity comparable to
the remaining term of the 2014 Notes to be redeemed that would be utilized, at the time of
selection and in accordance with customary financial practice, in pricing new issues of corporate
debt securities of comparable maturity to the remaining term of such 2014 Notes.

     “Quotation Agent” means a Reference Treasury Dealer appointed by the Corporation.

     “Comparable Treasury Price” means, with respect to any Redemption Date for the 2014 Notes, (1)
the average of the Reference Treasury Dealer Quotations for such Redemption Date, after excluding
the highest and lowest such Reference Treasury Dealer Quotations, or (2) if fewer than four such
Reference Treasury Dealer Quotations are obtained, the average of all such Reference Treasury
Dealer Quotations.

     “Reference Treasury Dealer” means each of BNY Mellon Capital Markets, LLC, Credit Suisse
Securities (USA) LLC, J.P. Morgan Securities Inc. and RBS Securities Inc. plus one other financial
institution appointed by the Corporation at the time of any redemption of the 2014 Notes or their
respective affiliates which are primary U.S. Government securities dealers in the United States (a
“Primary Treasury Dealer”) and their respective successors; provided, however, that if any of the
foregoing or their affiliates or successors ceases to be a Primary Treasury Dealer, the Corporation
will substitute therefor another Primary Treasury Dealer.

     “Reference Treasury Dealer Quotations” means, with respect to each Reference Treasury Dealer
and any Redemption Date for the 2014 Notes, the average, as determined by the

4

 

Quotation Agent, of the bid and asked prices for the applicable Comparable Treasury Issue
(expressed in each case as a percentage of its principal amount) quoted in writing to the Quotation
Agent by such Reference Treasury Dealer at 5:00 p.m., New York City time, on the third Business Day
preceding such Redemption Date.

     The Corporation shall notify the Trustee of the Redemption Price with respect to any
redemption of the 2014 Notes promptly after the calculation thereof. The Trustee shall not be
responsible for calculating said Redemption Price.

     If less than all of the 2014 Notes are to be redeemed, the Trustee shall select the 2014 Notes
or portions of 2014 Notes to be redeemed by such method as the Trustee shall deem fair and
appropriate. The Trustee may select for redemption 2014 Notes and portions of 2014 Notes in
amounts of $2,000 or any integral multiple of $1,000 in excess thereof.

     The 2014 Notes shall not have a sinking fund.

     Section 1.07. Paying Agent. The Trustee shall initially serve as Paying Agent with
respect to the 2014 Notes, with the Place of Payment initially being the Corporate Trust Office.

ARTICLE II

5.05% SENIOR NOTES DUE 2019

     Section 2.01. Establishment. There is hereby established a new series of Securities
to be issued under the Indenture, to be designated as the Corporation’s 5.05% Senior Notes due 2019
(the “2019 Notes”).

     There are to be authenticated and delivered $500,000,000 principal amount of the 2019 Notes,
and no further 2019 Notes shall be authenticated and delivered except as provided by Section 304,
305, 306, 906 or 1106 of the Original Indenture and the last paragraph of Section 301 thereof. The
2019 Notes shall be issued in fully registered form without coupons.

     The 2019 Notes shall be in substantially the form set out in Exhibit C hereto, and the form of
the Trustee’s Certificate of Authentication for the 2019 Notes shall be in substantially the form
set forth in Exhibit D hereto.

     Each 2019 Note shall be dated the date of authentication thereof and shall bear interest from
the date of original issuance thereof or from the most recent Interest Payment Date to which
interest has been paid or duly provided for.

     Section 2.02. Definitions. The following defined terms used in this Article 2 shall,
unless the context otherwise requires, have the meanings specified below for purposes of the 2019
Notes. Capitalized terms used herein for which no definition is provided herein shall have the
meanings set forth in the Original Indenture.

     “Business Day” means any day other than a Saturday or a Sunday that is neither a Legal Holiday
nor a day on which banking institutions in New York, New York are authorized or

5

 

required by law, regulation or executive order to close, or a day on which the Corporate Trust
Office is closed for business.

     “Interest Payment Date” means each March 15 and September 15 of each year, commencing March
15, 2010.

     “Original Issue Date” means August 28, 2009.

     “Regular Record Date” means, with respect to each Interest Payment Date, the close of business
on the 15th calendar day prior to such Interest Payment Date (whether or not a Business Day).

     “Stated Maturity” means September 15, 2019.

     Section 2.03. Payment of Principal and Interest. The principal of the 2019 Notes
shall be due at Stated Maturity (unless earlier redeemed). The unpaid principal amount of the 2019
Notes shall bear interest at the rate of 5.05% per annum until paid or duly provided for, such
interest to accrue from August 28, 2009 or from the most recent Interest Payment Date to which
interest has been paid or duly provided for. Interest shall be paid semi-annually in arrears on
each Interest Payment Date to the Person or Persons in whose name the 2019 Notes are registered on
the Regular Record Date for such Interest Payment Date; provided that interest payable at the
Stated Maturity or on a Redemption Date as provided herein shall be paid to the Person to whom
principal is payable. Any such interest that is not so punctually paid or duly provided for shall
forthwith cease to be payable to the Holders on such Regular Record Date and may either be paid to
the Person or Persons in whose name the 2019 Notes are registered at the close of business on a
Special Record Date for the payment of such defaulted interest to be fixed by the Trustee (“Special
Record Date”), notice whereof shall be given to Holders of the 2019 Notes not less than ten (10)
days prior to such Special Record Date, or be paid at any time in any other lawful manner not
inconsistent with the requirements of any securities exchange, if any, on which the 2019 Notes may
be listed, and upon such notice as may be required by any such exchange, all as more fully provided
in the Original Indenture.

     Payments of interest on the 2019 Notes shall include interest accrued to but excluding the
respective Interest Payment Dates. Interest payments for the 2019 Notes shall be computed and paid
on the basis of a 360-day year of twelve 30-day months. In the event that any date on which
interest is payable on the 2019 Notes is not a Business Day, then payment of the interest payable
on such date shall be made on the next succeeding day that is a Business Day (and without any
interest or payment in respect of any such delay) with the same force and effect as if made on the
date the payment was originally payable.

     Payment of principal of, premium, if any, and interest on the 2019 Notes shall be made in such
coin or currency of the United States of America as at the time of payment is legal tender for
payment of public and private debts. Payments of principal of, premium, if any, and interest on
2019 Notes represented by a Global Security shall be made by wire transfer of immediately available
funds to the Holder of such Global Security, provided that, in the case of payments of principal
and premium, if any, such Global Security is first surrendered to the Paying Agent. If any of the
2019 Notes are no longer represented by a Global Security, (i) payments of principal,

6

 

premium, if any, and interest due at the Stated Maturity or earlier redemption of such 2019
Notes shall be made at the office of the Paying Agent upon surrender of such 2019 Notes to the
Paying Agent and (ii) payments of interest shall be made, at the option of the Corporation, subject
to such surrender where applicable, (A) by check mailed to the address of the Person entitled
thereto as such address shall appear in the Security Register or (B) by wire transfer at such place
and to such account at a banking institution in the United States as may be designated in writing
to the Trustee at least sixteen (16) days prior to the date for payment by the Person entitled
thereto.

     Section 2.04. Denominations. The 2019 Notes shall be issued in denominations of
$2,000 or any integral multiple of $1,000 in excess thereof.

     Section 2.05. Global Securities. The 2019 Notes shall initially be issued in the form
of one or more Global Securities registered in the name of the Depositary (which initially shall be
The Depository Trust Company) or its nominee. Except under the limited circumstances described
below, 2019 Notes represented by such Global Security or Global Securities shall not be
exchangeable for, and shall not otherwise be issuable as, 2019 Notes in definitive form. The
Global Securities described in this Article 2 may not be transferred except by the Depositary to a
nominee of the Depositary or by a nominee of the Depositary to the Depositary or another nominee of
the Depositary or to a successor Depositary or its nominee.

     A Global Security shall be exchangeable for 2019 Notes registered in the names of persons
other than the Depositary or its nominee only if (i) the Depositary notifies the Corporation that
it is unwilling or unable to continue as a Depositary for such Global Security and no successor
Depositary shall have been appointed by the Corporation within 90 days of receipt by the
Corporation of such notification, or if at any time the Depositary ceases to be a clearing agency
registered under the Exchange Act at a time when the Depositary is required to be so registered to
act as such Depositary and no successor Depositary shall have been appointed by the Corporation
within 90 days after it becomes aware of such cessation, (ii) an Event of Default has occurred and
is continuing with respect to the 2019 Notes and beneficial owners of a majority in aggregate
principal amount of the 2019 Notes represented by Global Securities advise the Depositary to cease
acting as Depositary, or (iii) the Corporation in its sole discretion, and subject to the
procedures of the Depositary, determines that such Global Security shall be so exchangeable. Any
Global Security that is exchangeable pursuant to the preceding sentence shall be exchangeable for
2019 Notes registered in such names as the Depositary shall direct.

     Section 2.06. Redemption. The 2019 Notes shall be redeemable, in whole or from time
to time in part, at the option of the Corporation on any date (a “Redemption Date”), at a
Redemption Price equal to the greater of (i) 100% of the principal amount of the 2019 Notes to be
redeemed and (ii) the sum of the present values of the remaining scheduled payments of principal
and interest thereon (exclusive of interest accrued to such Redemption Date) discounted to such
Redemption Date on a semi-annual basis (assuming a 360-day year consisting of twelve 30-day months)
at the Treasury Rate plus 25 basis points, plus, in either case, accrued and unpaid interest on the
principal amount being redeemed to such Redemption Date.

     “Treasury Rate” means, with respect to any Redemption Date for the 2019 Notes, the rate per
annum equal to the semi-annual equivalent yield to maturity or interpolated maturity (on a

7

 

day count basis) of the applicable Comparable Treasury Issue, assuming a price for such
Comparable Treasury Issue (expressed as a percentage of its principal amount) equal to the
applicable Comparable Treasury Price for such Redemption Date. The Treasury Rate shall be
calculated on the third Business Day preceding the Redemption Date.

     “Comparable Treasury Issue” when used in this Section 2.06 means the United States Treasury
security selected by the Quotation Agent as having an actual or interpolated maturity comparable to
the remaining term of the 2019 Notes to be redeemed that would be utilized, at the time of
selection and in accordance with customary financial practice, in pricing new issues of corporate
debt securities of comparable maturity to the remaining term of such 2019 Notes.

     “Quotation Agent” means a Reference Treasury Dealer appointed by the Corporation.

     “Comparable Treasury Price” means, with respect to any Redemption Date for the 2019 Notes, (1)
the average of the Reference Treasury Dealer Quotations for such Redemption Date, after excluding
the highest and lowest such Reference Treasury Dealer Quotations, or (2) if fewer than four such
Reference Treasury Dealer Quotations are obtained, the average of all such Reference Treasury
Dealer Quotations.

     “Reference Treasury Dealer” means each of BNY Mellon Capital Markets, LLC, Credit Suisse
Securities (USA) LLC, J.P. Morgan Securities Inc. and RBS Securities Inc. plus one other financial
institution appointed by the Corporation at the time of any redemption of the 2019 Notes or their
respective affiliates which are primary U.S. Government securities dealers in the United States (a
“Primary Treasury Dealer”) and their respective successors; provided, however, that if any of the
foregoing or their affiliates or successors ceases to be a Primary Treasury Dealer, the Corporation
will substitute therefor another Primary Treasury Dealer.

     “Reference Treasury Dealer Quotations” means, with respect to each Reference Treasury Dealer
and any Redemption Date for the 2019 Notes, the average, as determined by the Quotation Agent, of
the bid and asked prices for the applicable Comparable Treasury Issue (expressed in each case as a
percentage of its principal amount) quoted in writing to the Quotation Agent by such Reference
Treasury Dealer at 5:00 p.m., New York City time, on the third Business Day preceding such
Redemption Date.

     The Corporation shall notify the Trustee of the Redemption Price with respect to any
redemption of the 2019 Notes promptly after the calculation thereof. The Trustee shall not be
responsible for calculating said Redemption Price.

     If less than all of the 2019 Notes are to be redeemed, the Trustee shall select the 2019 Notes
or portions of 2019 Notes to be redeemed by such method as the Trustee shall deem fair and
appropriate. The Trustee may select for redemption 2019 Notes and portions of 2019 Notes in
amounts of $2,000 or any integral multiple of $1,000 in excess thereof.

     The 2019 Notes shall not have a sinking fund.

     Section 2.07. Paying Agent. The Trustee shall initially serve as Paying Agent with
respect to the 2019 Notes, with the Place of Payment initially being the Corporate Trust Office.

8

 

ARTICLE III

MISCELLANEOUS PROVISIONS

     Section 3.01. Recitals by the Corporation. The recitals in this Third Supplemental
Indenture are made by the Corporation only and not by the Trustee, and all of the provisions
contained in the Original Indenture in respect of the rights, privileges, immunities, powers and
duties of the Trustee shall be applicable in respect of the 2014 Notes and the 2019 Notes and of
this Third Supplemental Indenture as fully and with like effect as if set forth herein in full.

     Section 3.02. Ratification and Incorporation of Original Indenture. As supplemented
hereby, the Original Indenture is in all respects ratified and confirmed, and the Original
Indenture and this Third Supplemental Indenture shall be read, taken and construed as one and the
same instrument.

     Section 3.03. Executed in Counterparts. This Third Supplemental Indenture may be
executed in several counterparts, each of which shall be deemed to be an original, and such
counterparts shall together constitute but one and the same instrument.

9

 

     IN WITNESS WHEREOF, each party hereto has caused this instrument to be signed in its name and
behalf by its duly authorized officer, all as of the day and year first above written.

	 	 	 	 	 	 	 
	 	 	Duke Energy Corporation	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	 	 	 
	 

	 	Name:
	 	 

M. Allen Carrick
	 	 
	 

	 	Title:
	 	Assistant Treasurer	 	 
	 
	 	 	 	 	 	 
	 	 	The Bank of New York Mellon Trust Company, N.A., as
Trustee	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	 	 	 
	 

	 	Name:
	 	 

Van K. Brown
	 	 
	 

	 	Title:
	 	Vice President	 	 

10

 

EXHIBIT A

FORM OF

3.95% SENIOR NOTE DUE 2014

			
	 	 	 
	No.
	 	CUSIP No. 26441C AC9

DUKE ENERGY CORPORATION

3.95% SENIOR NOTE DUE 2014

Principal Amount: $

Regular Record Date: Close of business on the 15th calendar day prior to the relevant Interest
Payment Date (whether or not a Business Day)

Original Issue Date: August 28, 2009

Stated Maturity: September 15, 2014

Interest Payment Dates: Semi-annually on March 15 and September 15 of each year, commencing March
15, 2010.

Interest Rate: 3.95% per annum

Authorized Denomination: $2,000 or any integral multiple of $1,000 in excess thereof

     Duke Energy Corporation, a Delaware corporation (the “Corporation”, which term includes any
successor corporation under the Indenture referred to on the reverse hereof), for value received,
hereby promises to pay to                     , or registered assigns, the principal sum of
                                         DOLLARS ($                    ) on the Stated Maturity shown above and to pay interest
thereon from the Original Issue Date shown above, or from the most recent Interest Payment Date to
which interest has been paid or duly provided for, semi-annually in arrears on each Interest
Payment Date as specified above, commencing on March 15, 2010 and on the Stated Maturity at the
rate per annum shown above (the “Interest Rate”) until the principal hereof is paid or made
available for payment and on any overdue principal and on any overdue installment of interest. The
interest so payable, and punctually paid or duly provided for, on any Interest Payment Date (other
than an Interest Payment Date that is the Stated Maturity or a Redemption Date) will, as provided
in the Indenture, be paid to the Person in whose name this 3.95% Senior Note due 2014 (this
“Security”) is registered on the Regular Record Date as specified above next preceding such
Interest Payment Date; provided that any interest payable at Stated Maturity or on a Redemption
Date will be paid to the Person to whom principal is payable. Except as otherwise provided in the
Indenture, any such interest not so punctually paid or duly provided for will forthwith cease to be
payable to the Holder on such Regular Record Date and may either be paid to the Person in whose
name this Security is registered at the close of business on a Special Record Date for the payment
of such Defaulted Interest to be fixed by the Trustee, notice whereof shall be given to Holders of
Securities of this series not less than 10 days prior to such Special Record Date, or be paid at
any time in any other lawful manner not inconsistent with the requirements of any securities
exchange, if any, on

A-1 

 

which the Securities shall be listed, and upon such notice as may be required by any such
exchange, all as more fully provided in the Indenture.

     Payments of interest on this Security will include interest accrued to but excluding the
respective Interest Payment Dates. Interest payments for this Security shall be computed and paid
on the basis of a 360-day year of twelve 30-day months and will accrue from August 28, 2009 or from
the most recent Interest Payment Date to which interest has been paid or duly provided for. In the
event that any date on which interest is payable on this Security is not a Business Day, then
payment of the interest payable on such date will be made on the next succeeding day that is a
Business Day (and without any interest or payment in respect of any such delay) with the same force
and effect as if made on the date the payment was originally payable. “Business Day” means a day
other than a Saturday or a Sunday that is neither a Legal Holiday nor a day on which banking
institutions in New York, New York are authorized or required by law, regulation or executive order
to close or a day on which the Corporate Trust Office is closed for business. “Legal Holiday”
means any day that is a legal holiday in New York, New York.

     Payment of principal of, premium, if any, and interest on the Securities of this series shall
be made in such coin or currency of the United States of America as at the time of payment is legal
tender for payment of public and private debts. Payments of principal of, premium, if any, and
interest on the Securities of this series represented by a Global Security shall be made by wire
transfer of immediately available funds to the Holder of such Global Security, provided that, in
the case of payments of principal and premium, if any, such Global Security is first surrendered to
the Paying Agent. If any of the Securities of this series are no longer represented by a Global
Security, (i) payments of principal, premium, if any, and interest due at the Stated Maturity or
earlier redemption of such Securities shall be made at the office of the Paying Agent upon
surrender of such Securities to the Paying Agent, and (ii) payments of interest shall be made, at
the option of the Corporation, subject to such surrender where applicable, (A) by check mailed to
the address of the Person entitled thereto as such address shall appear in the Security Register or
(B) by wire transfer at such place and to such account at a banking institution in the United
States as may be designated in writing to the Trustee at least sixteen (16) days prior to the date
for payment by the Person entitled thereto.

     The Securities of this series shall be redeemable, in whole or from time to time in part, at
the option of the Corporation on any date (a “Redemption Date”), at a Redemption Price equal to the
greater of (i) 100% of the principal amount of the Securities of this series to be redeemed and
(ii) the sum of the present values of the remaining scheduled payments of principal and interest
thereon (exclusive of interest accrued to such Redemption Date) discounted to such Redemption Date
on a semi-annual basis (assuming a 360-day year consisting of twelve 30-day months) at the Treasury
Rate plus 25 basis points, plus, in either case, accrued and unpaid interest on the principal
amount being redeemed to such Redemption Date.

     “Treasury Rate” means, with respect to any Redemption Date for the Securities of this series,
the rate per annum equal to the semi-annual equivalent yield to maturity or interpolated maturity
(on a day count basis) of the Comparable Treasury Issue, assuming a price for such Comparable
Treasury Issue (expressed as a percentage of its principal amount) equal to the

A-2 

 

applicable Comparable Treasury Price for such Redemption Date. The Treasury Rate shall be
calculated on the third Business Day preceding the Redemption Date.

     “Comparable Treasury Issue” means the United States Treasury security selected by the
Quotation Agent as having an actual or interpolated maturity comparable to the remaining term of
the Securities of this series to be redeemed that would be utilized, at the time of selection and
in accordance with customary financial practice, in pricing new issues of corporate debt securities
of comparable maturity to the remaining term of such Securities of this series.

     “Quotation Agent” means a Reference Treasury Dealer appointed by the Corporation.

     “Comparable Treasury Price” means, with respect to any Redemption Date for the Securities of
this series, (1) the average of the Reference Treasury Dealer Quotations for such Redemption Date,
after excluding the highest and lowest such Reference Treasury Dealer Quotations, or (2) if fewer
than four such Reference Treasury Dealer Quotations are obtained, the average of all such Reference
Treasury Dealer Quotations.

     “Reference Treasury Dealer” means each of BNY Mellon Capital Markets, LLC, Credit Suisse
Securities (USA) LLC, J.P. Morgan Securities Inc. and RBS Securities Inc. plus one other financial
institution appointed by the Corporation at the time of any redemption of the Securities of this
series or their respective affiliates which are primary U.S. Government securities dealers in the
United States (a “Primary Treasury Dealer”) and their respective successors; provided, however,
that if any of the foregoing or their affiliates or successors ceases to be a Primary Treasury
Dealer, the Corporation will substitute therefor another Primary Treasury Dealer.

     “Reference Treasury Dealer Quotations” means, with respect to each Reference Treasury Dealer
and any Redemption Date, the average, as determined by the Quotation Agent, of the bid and asked
prices for the applicable Comparable Treasury Issue (expressed in each case as a percentage of its
principal amount) quoted in writing to the Quotation Agent by such Reference Treasury Dealer at
5:00 p.m., New York City time, on the third Business Day preceding such Redemption Date.

     The Corporation shall notify the Trustee of the Redemption Price with respect to any
redemption of the Securities of this series promptly after the calculation thereof. The Trustee
shall not be responsible for calculating said Redemption Price.

     Notice of any redemption by the Corporation will be mailed at least 30 days but not more than
60 days before any Redemption Date to each Holder of Securities of this series to be redeemed. If
Notice of a redemption is provided and funds are deposited as required, interest will cease to
accrue on and after the Redemption Date on the Securities of this series or portions of Securities
of this series called for redemption. In the event that any Redemption Date is not a Business Day,
the Corporation will pay the Redemption Price on the next Business Day without any interest or
other payment in respect of any such delay. If less than all the Securities of this series are to
be redeemed at the option of the Corporation, the Trustee shall select, in such manner as it shall
deem fair and appropriate, the Securities of this series to be redeemed in whole or in part. The
Trustee may select for redemption Securities of this series and portions of the Securities of this
series in amounts of $2,000 or any integral multiple of $1,000 in excess thereof.

A-3 

 

     In the event of redemption of this Security in part only, a new Security or Securities of this
series and of like tenor for the unredeemed portion hereof will be issued in the name of the Holder
hereof upon the surrender hereof.

     The Securities of this series shall not have a sinking fund.

     The Securities of this series shall constitute the direct unsecured and unsubordinated debt
obligations of the Corporation and shall rank equally in priority with the Corporation’s existing
and future unsecured and unsubordinated indebtedness.

     REFERENCE IS HEREBY MADE TO THE FURTHER PROVISIONS OF THIS SECURITY SET FORTH ON THE REVERSE
HEREOF, WHICH FURTHER PROVISIONS SHALL FOR ALL PURPOSES HAVE THE SAME EFFECT AS IF SET FORTH AT
THIS PLACE.

     Unless the certificate of authentication hereon has been executed by the Trustee by manual
signature, this Security shall not be entitled to any benefit under the Indenture or be valid or
obligatory for any purpose.

A-4 

 

     IN WITNESS WHEREOF, the Corporation has caused this instrument to be duly executed.

	 	 	 	 	 	 	 
	 	 	Duke Energy Corporation
	 
	 	 	 	 	 	 
	 

	 	By:	 	 	 	 
	 

	 	Name:
	 	 

	 	 
	 

	 	Title:	 	 	 	 

CERTIFICATE OF AUTHENTICATION

     This is one of the Securities of the series designated therein referred to in the
within-mentioned Indenture.

	 	 	 	 	 	 	 
	Dated:	 	The Bank of New York Mellon Trust Company, N.A., as Trustee
	 
	 	 	 	 	 	 
	 

	 	By:	 	 	 	 
	 

	 	 	 	 
      
Authorized Signatory
	 	 

A-5 

 

(Reverse Side of Security)

     This 3.95% Senior Note due 2014 is one of a duly authorized issue of Securities of the
Corporation (the “Securities”), issued and issuable in one or more series under an Indenture, dated
as of June 3, 2008, as supplemented (the “Indenture”), between the Corporation and The Bank of New
York Mellon Trust Company, N.A. (formerly known as The Bank of New York Trust Company, N.A.), as
Trustee (the “Trustee,” which term includes any successor trustee under the Indenture), to which
Indenture and all indentures supplemental thereto reference is hereby made for a statement of the
respective rights, limitation of rights, duties and immunities thereunder of the Corporation, the
Trustee and the Holders of the Securities issued thereunder and of the terms upon which said
Securities are, and are to be, authenticated and delivered. This Security is one of the series
designated on the face hereof as 3.95% Senior Notes due 2014 initially in the aggregate principal
amount of $500,000,000. Capitalized terms used herein for which no definition is provided herein
shall have the meanings set forth in the Indenture.

     If an Event of Default with respect to the Securities of this series shall occur and be
continuing, the principal of the Securities of this series may be declared due and payable in the
manner, with the effect and subject to the conditions provided in the Indenture.

     The Indenture permits, with certain exceptions as therein provided, the amendment thereof and
the modification of the rights and obligations of the Corporation and the rights of the Holders of
the Securities of all series affected under the Indenture at any time by the Corporation and the
Trustee with the consent of the Holders of not less than a majority in principal amount of the
Outstanding Securities of all series affected thereby (voting as one class). The Indenture
contains provisions permitting the Holders of not less than a majority in principal amount of the
Outstanding Securities of all series with respect to which a default under the Indenture shall have
occurred and be continuing (voting as one class), on behalf of the Holders of the Securities of all
such series, to waive, with certain exceptions, such default under the Indenture and its
consequences. The Indenture also permits the Holders of not less than a majority in principal
amount of the Securities of each series at the time Outstanding, on behalf of the Holders of all
Securities of such series, to waive compliance by the Corporation with certain provisions of the
Indenture affecting such series. Any such consent or waiver by the Holder of this Security shall be
conclusive and binding upon such Holder and upon all future Holders of this Security and of any
Security issued upon the registration of transfer hereof or in exchange hereof or in lieu hereof,
whether or not notation of such consent or waiver is made upon this Security.

     No reference herein to the Indenture and no provision of this Security or of the Indenture
shall alter or impair the obligation of the Corporation, which is absolute and unconditional, to
pay the principal of and interest on this Security at the times, place and rate, and in the coin or
currency, herein prescribed.

     As provided in the Indenture and subject to certain limitations therein set forth, the
transfer of this Security is registrable in the Security Register, upon surrender of this Security
for registration of transfer at the office or agency of the Corporation for such purpose, duly
endorsed by, or accompanied by a written instrument of transfer in form satisfactory to the
Corporation and the Security Registrar and duly executed by, the Holder hereof or his attorney duly
authorized in writing, and thereupon one or more new Securities of this series, of authorized

A-6 

 

denominations and of like tenor and for the same aggregate principal amount, will be issued to
the designated transferee or transferees. No service charge shall be made for any such registration
of transfer or exchange, but the Corporation may require payment of a sum sufficient to cover any
tax or other governmental charge payable in connection therewith.

     The Indenture contains provisions for defeasance at any time of the entire indebtedness of the
Securities of this series and for covenant defeasance at any time of certain covenants in the
Indenture upon compliance with certain conditions set forth in the Indenture.

     Prior to due presentment of this Security for registration of transfer, the Corporation, the
Trustee and any agent of the Corporation or the Trustee may treat the Person in whose name this
Security is registered as the owner hereof for all purposes, whether or not this Security be
overdue, and neither the Corporation, the Trustee nor any such agent shall be affected by notice to
the contrary.

     The Securities of this series are issuable only in registered form without coupons in
denominations of $2,000 or any integral multiple of $1,000 in excess thereof. As provided in the
Indenture and subject to the limitations therein set forth, Securities of this series are
exchangeable for a like aggregate principal amount of Securities of this series of a different
authorized denomination, as requested by the Holder surrendering the same upon surrender of the
Security or Securities to be exchanged at the office or agency of the Corporation.

     This Security shall be governed by, and construed in accordance with, the laws of the State of
New York.

A-7 

 

ABBREVIATIONS

The following abbreviations, when used in the inscription on the face of this instrument, shall be
construed as though they were written out in full according to applicable laws or regulations:

	 	 	 
	TEN COM — as tenants in common

	 	UNIF GIFT MIN ACT –                      Custodian                           

                                                  (Cust)                               (Minor)
	 
	 	 
	TEN ENT — as tenants by the entireties
	 	 
	 
	 	 
	JT TEN — as joint tenants with rights
of survivorship and not as tenants in
common

	 	    under Uniform Gifts to
Minors Act                        

                                                                        (State)

Additional abbreviations may also be used though not on the above list.

FOR VALUE RECEIVED, the undersigned hereby sell(s) and transfer(s) unto (please insert Social
Security or other identifying number of assignee)

PLEASE PRINT OR TYPEWRITE NAME AND ADDRESS, INCLUDING POSTAL ZIP CODE OF ASSIGNEE

the within Security and all rights thereunder, hereby irrevocably constituting and appointing agent
to transfer said Security on the books of the Corporation, with full power of substitution in the
premises.

	 	 	 
	Dated:                                         
	 	 
	 
	 	 
	 

	 	NOTICE: The signature to this assignment must
correspond with the name as written upon the face of
the within instrument in every particular without
alteration or enlargement, or any change whatever.
	 
	 	 
	 

	 	Signature Guarantee:                                         

A-8 

 

SIGNATURE GUARANTEE

Signatures must be guaranteed by an “eligible guarantor institution” meeting the requirements of
the Security Registrar, which requirements include membership or participation in the Security
Transfer Agent Medallion Program (“STAMP”) or such other “signature guarantee program” as may be
determined by the Security Registrar in addition to, or in substitution for, STAMP, all in
accordance with the Securities Exchange Act of 1934, as amended.

A-9 

 

EXHIBIT B

CERTIFICATE OF AUTHENTICATION

This is one of the Securities of the series designated therein referred to in the within-mentioned
Indenture.

	 	 	 	 	 	 	 
	Dated:	 	The Bank of New York Mellon Trust Company, N.A., as Trustee
	 
	 	 	 	 	 	 
	 

	 	By:	 	 	 	 
	 

	 	 	 	 

          Authorized Signatory
	 	 

B-1 

 

EXHIBIT C

FORM OF

5.05% SENIOR NOTE DUE 2019

			
	 	 	 
	No.
	 	CUSIP No. 26441C AD7

DUKE ENERGY CORPORATION

5.05% SENIOR NOTE DUE 2019

Principal Amount: $

Regular Record Date: Close of business on the 15th calendar day prior to the relevant Interest
Payment Date (whether or not a Business Day)

Original Issue Date: August 28, 2009

Stated Maturity: September 15, 2019

Interest Payment Dates: Semi-annually on March 15 and September 15 of each year, commencing March
15, 2010.

Interest Rate: 5.05% per annum

Authorized Denomination: $2,000 or any integral multiple of $1,000 in excess thereof

     Duke Energy Corporation, a Delaware corporation (the “Corporation”, which term includes any
successor corporation under the Indenture referred to on the reverse hereof), for value received,
hereby promises to pay to                     , or registered assigns, the principal sum of
                                         DOLLARS ($                    ) on the Stated Maturity shown above and to pay
interest thereon from the Original Issue Date shown above, or from the most recent Interest Payment
Date to which interest has been paid or duly provided for, semi-annually in arrears on each
Interest Payment Date as specified above, commencing on March 15, 2010 and on the Stated Maturity
at the rate per annum shown above (the “Interest Rate”) until the principal hereof is paid or made
available for payment and on any overdue principal and on any overdue installment of interest. The
interest so payable, and punctually paid or duly provided for, on any Interest Payment Date (other
than an Interest Payment Date that is the Stated Maturity or a Redemption Date) will, as provided
in the Indenture, be paid to the Person in whose name this 5.05% Senior Note due 2019 (this
“Security”) is registered on the Regular Record Date as specified above next preceding such
Interest Payment Date; provided that any interest payable at Stated Maturity or on a Redemption
Date will be paid to the Person to whom principal is payable. Except as otherwise provided in the
Indenture, any such interest not so punctually paid or duly provided for will forthwith cease to be
payable to the Holder on such Regular Record Date and may either be paid to the Person in whose
name this Security is registered at the close of business on a Special Record Date for the payment
of such Defaulted Interest to be fixed by the Trustee, notice whereof shall be given to Holders of
Securities of this series not less than 10 days prior to such Special Record Date, or be paid at
any time in any other lawful manner not inconsistent with the requirements of any securities
exchange, if any, on

C-1 

 

which the Securities shall be listed, and upon such notice as may be required by any such
exchange, all as more fully provided in the Indenture.

     Payments of interest on this Security will include interest accrued to but excluding the
respective Interest Payment Dates. Interest payments for this Security shall be computed and paid
on the basis of a 360-day year of twelve 30-day months and will accrue from August 28, 2009 or from
the most recent Interest Payment Date to which interest has been paid or duly provided for. In
the event that any date on which interest is payable on this Security is not a Business Day, then
payment of the interest payable on such date will be made on the next succeeding day that is a
Business Day (and without any interest or payment in respect of any such delay) with the same force
and effect as if made on the date the payment was originally payable. “Business Day” means a day
other than a Saturday or a Sunday that is neither a Legal Holiday nor a day on which banking
institutions in New York, New York are authorized or required by law, regulation or executive order
to close or a day on which the Corporate Trust Office is closed for business. “Legal Holiday”
means any day that is a legal holiday in New York, New York.

     Payment of principal of, premium, if any, and interest on the Securities of this series shall
be made in such coin or currency of the United States of America as at the time of payment is legal
tender for payment of public and private debts. Payments of principal of, premium, if any, and
interest on the Securities of this series represented by a Global Security shall be made by wire
transfer of immediately available funds to the Holder of such Global Security, provided that, in
the case of payments of principal and premium, if any, such Global Security is first surrendered to
the Paying Agent. If any of the Securities of this series are no longer represented by a Global
Security, (i) payments of principal, premium, if any, and interest due at the Stated Maturity or
earlier redemption of such Securities shall be made at the office of the Paying Agent upon
surrender of such Securities to the Paying Agent, and (ii) payments of interest shall be made, at
the option of the Corporation, subject to such surrender where applicable, (A) by check mailed to
the address of the Person entitled thereto as such address shall appear in the Security Register or
(B) by wire transfer at such place and to such account at a banking institution in the United
States as may be designated in writing to the Trustee at least sixteen (16) days prior to the date
for payment by the Person entitled thereto.

     The Securities of this series shall be redeemable, in whole or from time to time in part, at
the option of the Corporation on any date (a “Redemption Date”), at a Redemption Price equal to the
greater of (i) 100% of the principal amount of the Securities of this series to be redeemed and
(ii) the sum of the present values of the remaining scheduled payments of principal and interest
thereon (exclusive of interest accrued to such Redemption Date) discounted to such Redemption Date
on a semi-annual basis (assuming a 360-day year consisting of twelve 30-day months) at the Treasury
Rate plus 25 basis points, plus, in either case, accrued and unpaid interest on the principal
amount being redeemed to such Redemption Date.

     “Treasury Rate” means, with respect to any Redemption Date for the Securities of this series,
the rate per annum equal to the semi-annual equivalent yield to maturity or interpolated maturity
(on a day count basis) of the Comparable Treasury Issue, assuming a price for such Comparable
Treasury Issue (expressed as a percentage of its principal amount) equal to the

C-2 

 

applicable Comparable Treasury Price for such Redemption Date. The Treasury Rate shall be
calculated on the third Business Day preceding the Redemption Date.

     “Comparable Treasury Issue” means the United States Treasury security selected by the
Quotation Agent as having an actual or interpolated maturity comparable to the remaining term of
the Securities of this series to be redeemed that would be utilized, at the time of selection and
in accordance with customary financial practice, in pricing new issues of corporate debt securities
of comparable maturity to the remaining term of such Securities of this series.

     “Quotation Agent” means a Reference Treasury Dealer appointed by the Corporation.

     “Comparable Treasury Price” means, with respect to any Redemption Date for the Securities of
this series, (1) the average of the Reference Treasury Dealer Quotations for such Redemption Date,
after excluding the highest and lowest such Reference Treasury Dealer Quotations, or (2) if fewer
than four such Reference Treasury Dealer Quotations are obtained, the average of all such Reference
Treasury Dealer Quotations.

     “Reference Treasury Dealer” means each of BNY Mellon Capital Markets, LLC, Credit Suisse
Securities (USA) LLC, J.P. Morgan Securities Inc. and RBS Securities Inc. plus one other financial
institution appointed by the Corporation at the time of any redemption of the Securities of this
series or their respective affiliates which are primary U.S. Government securities dealers in the
United States (a “Primary Treasury Dealer”) and their respective successors; provided, however,
that if any of the foregoing or their affiliates or successors ceases to be a Primary Treasury
Dealer, the Corporation will substitute therefor another Primary Treasury Dealer.

     “Reference Treasury Dealer Quotations” means, with respect to each Reference Treasury Dealer
and any Redemption Date, the average, as determined by the Quotation Agent, of the bid and asked
prices for applicable Comparable Treasury Issue (expressed in each case as a percentage of its
principal amount) quoted in writing to the Quotation Agent by such Reference Treasury Dealer at
5:00 p.m., New York City time, on the third Business Day preceding such Redemption Date.

     The Corporation shall notify the Trustee of the Redemption Price with respect to any
redemption of the Securities of this series promptly after the calculation thereof. The Trustee
shall not be responsible for calculating said Redemption Price.

     Notice of any redemption by the Corporation will be mailed at least 30 days but not more than
60 days before any Redemption Date to each Holder of Securities of this series to be redeemed. If
Notice of a redemption is provided and funds are deposited as required, interest will cease to
accrue on and after the Redemption Date on the Securities of this series or portions of Securities
of this series called for redemption. In the event that any Redemption Date is not a Business Day,
the Corporation will pay the Redemption Price on the next Business Day without any interest or
other payment in respect of any such delay. If less than all the Securities of this series are to
be redeemed at the option of the Corporation, the Trustee shall select, in such manner as it shall
deem fair and appropriate, the Securities of this series to be redeemed in whole or in part. The
Trustee may select for redemption Securities of this series and portions of the Securities of this
series in amounts of $2,000 or any integral multiple of $1,000 in excess thereof.

C-3 

 

     In the event of redemption of this Security in part only, a new Security or Securities of this
series and of like tenor for the unredeemed portion hereof will be issued in the name of the Holder
hereof upon the surrender hereof.

     The Securities of this series shall not have a sinking fund.

     The Securities of this series shall constitute the direct unsecured and unsubordinated debt
obligations of the Corporation and shall rank equally in priority with the Corporation’s existing
and future unsecured and unsubordinated indebtedness.

     REFERENCE IS HEREBY MADE TO THE FURTHER PROVISIONS OF THIS SECURITY SET FORTH ON THE REVERSE
HEREOF, WHICH FURTHER PROVISIONS SHALL FOR ALL PURPOSES HAVE THE SAME EFFECT AS IF SET FORTH AT
THIS PLACE.

     Unless the certificate of authentication hereon has been executed by the Trustee by manual
signature, this Security shall not be entitled to any benefit under the Indenture or be valid or
obligatory for any purpose.

C-4 

 

     IN WITNESS WHEREOF, the Corporation has caused this instrument to be duly executed.

	 	 	 	 	 	 	 
	 	 	Duke Energy Corporation	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	 	 	 
	 

	 	Name:
	 	 

	 	 
	 

	 	Title:	 	 	 	 

CERTIFICATE OF AUTHENTICATION

This is one of the Securities of the series designated therein referred to in the within-mentioned
Indenture.

	 	 	 	 	 	 	 
	Dated:	 	The Bank of New York Mellon Trust Company, N.A., as Trustee
	 
	 	 	 	 	 	 
	 

	 	By:	 	 	 	 
	 

	 	 	 	 
       
Authorized Signatory
	 	 

C-5 

 

(Reverse Side of Security)

     This 5.05% Senior Note due 2019 is one of a duly authorized issue of Securities of the
Corporation (the “Securities”), issued and issuable in one or more series under an Indenture, dated
as of June 3, 2008, as supplemented (the “Indenture”), between the Corporation and The Bank of New
York Mellon Trust Company, N.A. (formerly known as The Bank of New York Trust Company, N.A.), as
Trustee (the “Trustee,” which term includes any successor trustee under the Indenture), to which
Indenture and all indentures supplemental thereto reference is hereby made for a statement of the
respective rights, limitation of rights, duties and immunities thereunder of the Corporation, the
Trustee and the Holders of the Securities issued thereunder and of the terms upon which said
Securities are, and are to be, authenticated and delivered. This Security is one of the series
designated on the face hereof as 5.05% Senior Notes due 2019 initially in the aggregate principal
amount of $500,000,000. Capitalized terms used herein for which no definition is provided herein
shall have the meanings set forth in the Indenture.

     If an Event of Default with respect to the Securities of this series shall occur and be
continuing, the principal of the Securities of this series may be declared due and payable in the
manner, with the effect and subject to the conditions provided in the Indenture.

     The Indenture permits, with certain exceptions as therein provided, the amendment thereof and
the modification of the rights and obligations of the Corporation and the rights of the Holders of
the Securities of all series affected under the Indenture at any time by the Corporation and the
Trustee with the consent of the Holders of not less than a majority in principal amount of the
Outstanding Securities of all series affected thereby (voting as one class). The Indenture
contains provisions permitting the Holders of not less than a majority in principal amount of the
Outstanding Securities of all series with respect to which a default under the Indenture shall have
occurred and be continuing (voting as one class), on behalf of the Holders of the Securities of all
such series, to waive, with certain exceptions, such default under the Indenture and its
consequences. The Indenture also permits the Holders of not less than a majority in principal
amount of the Securities of each series at the time Outstanding, on behalf of the Holders of all
Securities of such series, to waive compliance by the Corporation with certain provisions of the
Indenture affecting such series. Any such consent or waiver by the Holder of this Security shall
be conclusive and binding upon such Holder and upon all future Holders of this Security and of any
Security issued upon the registration of transfer hereof or in exchange hereof or in lieu hereof,
whether or not notation of such consent or waiver is made upon this Security.

     No reference herein to the Indenture and no provision of this Security or of the Indenture
shall alter or impair the obligation of the Corporation, which is absolute and unconditional, to
pay the principal of and interest on this Security at the times, place and rate, and in the coin or
currency, herein prescribed.

     As provided in the Indenture and subject to certain limitations therein set forth, the
transfer of this Security is registrable in the Security Register, upon surrender of this Security
for registration of transfer at the office or agency of the Corporation for such purpose, duly
endorsed by, or accompanied by a written instrument of transfer in form satisfactory to the
Corporation and the Security Registrar and duly executed by, the Holder hereof or his attorney duly
authorized in writing, and thereupon one or more new Securities of this series, of authorized

C-6 

 

denominations and of like tenor and for the same aggregate principal amount, will be issued to
the designated transferee or transferees. No service charge shall be made for any such
registration of transfer or exchange, but the Corporation may require payment of a sum sufficient
to cover any tax or other governmental charge payable in connection therewith.

     The Indenture contains provisions for defeasance at any time of the entire indebtedness of the
Securities of this series and for covenant defeasance at any time of certain covenants in the
Indenture upon compliance with certain conditions set forth in the Indenture.

     Prior to due presentment of this Security for registration of transfer, the Corporation, the
Trustee and any agent of the Corporation or the Trustee may treat the Person in whose name this
Security is registered as the owner hereof for all purposes, whether or not this Security be
overdue, and neither the Corporation, the Trustee nor any such agent shall be affected by notice to
the contrary.

     The Securities of this series are issuable only in registered form without coupons in
denominations of $2,000 or any integral multiple of $1,000 in excess thereof. As provided in the
Indenture and subject to the limitations therein set forth, Securities of this series are
exchangeable for a like aggregate principal amount of Securities of this series of a different
authorized denomination, as requested by the Holder surrendering the same upon surrender of the
Security or Securities to be exchanged at the office or agency of the Corporation.

     This Security shall be governed by, and construed in accordance with, the laws of the State of
New York.

C-7 

 

ABBREVIATIONS

The following abbreviations, when used in the inscription on the face of this instrument, shall be
construed as though they were written out in full according to applicable laws or regulations:

	 	 	 
	TEN COM — as tenants in common

	 	UNIF GIFT MIN ACT –
______ Custodian __________

                                           (Cust)                      (Minor)
	 
	 	 
	TEN ENT — as tenants by the entireties
	 	 
	 
	 	 
	JT TEN — as joint tenants with rights
of survivorship and not as tenants in
common

	 	     under Uniform Gifts to
Minors Act                      

                                                                       (State)

Additional abbreviations may also be used though not on the above list.

FOR VALUE RECEIVED, the undersigned hereby sell(s) and transfer(s) unto (please insert Social
Security or other identifying number of assignee)

PLEASE PRINT OR TYPEWRITE NAME AND ADDRESS, INCLUDING POSTAL ZIP CODE OF ASSIGNEE

the within Security and all rights thereunder, hereby irrevocably constituting and appointing agent
to transfer said Security on the books of the Corporation, with full power of substitution in the
premises.

	 	 	 
	Dated:                                         
	 	 
	 
	 	 
	 

	 	NOTICE: The signature to this assignment must
correspond with the name as written upon the face of
the within instrument in every particular without
alteration or enlargement, or any change whatever.
	 
	 	 
	 

	 	Signature Guarantee:                                         

C-8 

 

SIGNATURE GUARANTEE

     Signatures must be guaranteed by an “eligible guarantor institution” meeting the requirements
of the Security Registrar, which requirements include membership or participation in the Security
Transfer Agent Medallion Program (“STAMP”) or such other “signature guarantee program” as may be
determined by the Security Registrar in addition to, or in substitution for, STAMP, all in
accordance with the Securities Exchange Act of 1934, as amended.

C-9 

 

EXHIBIT D

CERTIFICATE OF AUTHENTICATION

This is one of the Securities of the series designated therein referred to in the within-mentioned
Indenture.

	 	 	 	 	 	 	 
	Dated:	 	The Bank of New York Mellon Trust Company, N.A., as Trustee
	 
	 	 	 	 	 	 
	 

	 	By:	 	 	 	 
	 

	 	 	 	 
      
Authorized Signatory
	 	 

D-1

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