Document:

First Supplemental Indenture

 Exhibit 4.2 
 EXECUTION COPY 
  
  
 FIRST SUPPLEMENTAL INDENTURE 
 between 
 MARITIMES & NORTHEAST PIPELINE, L.L.C. 
 and 
 DEUTSCHE BANK TRUST COMPANY AMERICAS, 
 as Trustee 
  
  
 May 14, 2009

 7.5% Senior Notes due 2014 
  
  

 TABLE OF CONTENTS 
  

					
	ARTICLE 1
	THE 2014 NOTES
			
	SECTION 1.1.	 	Designation of Notes; Establishment of Form	  	1
	SECTION 1.2.	 	Amount, Etc.	  	2
	SECTION 1.3.	 	Redemption and Repurchase	  	2
	SECTION 1.4.	 	Conversion	  	2
	SECTION 1.5.	 	Maturity	  	3
	SECTION 1.6.	 	Other Terms of Notes	  	3
	ARTICLE 2
	MISCELLANEOUS PROVISIONS
			
	SECTION 2.1.	 	Integral Part	  	3
	SECTION 2.2.	 	Rules of Construction	  	3
	SECTION 2.3.	 	Adoption, Ratification and Confirmation	  	3
	SECTION 2.4.	 	Counterparts	  	3
	SECTION 2.5.	 	Benefits of Indenture	  	4
	SECTION 2.6.	 	Governing Law	  	4
			
	EXHIBIT A	 	FORM OF NOTE	  	A-1

  

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 FIRST SUPPLEMENTAL INDENTURE 
 THIS FIRST SUPPLEMENTAL INDENTURE, dated as of May 14, 2009 (this “First Supplemental Indenture”), between Maritimes & Northeast
Pipeline, L.L.C.., a Delaware limited liability company (the “Issuer” or the “Company”), and Deutsche Bank Trust Company Americas, a New York banking corporation, as trustee (the “Trustee”), 
 W I T N E S S E T H: 
 WHEREAS, the
Issuer has heretofore executed and delivered to the Trustee an Indenture, dated as of even date herewith (the “Original Indenture” and, as amended and supplemented by this First Supplemental Indenture, the “Indenture”), providing
for the issuance from time to time of one or more series of the Company’s Notes; 
 WHEREAS, Section 9.01(g) of the Indenture
provides that the Issuer and the Trustee may from time to time enter into one or more indentures supplemental thereto to establish the form or terms of Notes of a new series; 
 WHEREAS, the Issuer desires to issue, as the initial series of Notes under the Indenture, $585,000,000 aggregate principal amount of 7.5% Senior Notes
due 2014 (the “2014 Notes”), the issuance of which has been authorized by a Management Committee Resolution; 
 WHEREAS, the
Issuer, pursuant to the foregoing authority, proposes in and by this First Supplemental Indenture to supplement and amend the Original Indenture, but only insofar as it will apply to the 2014 Notes; and 
 WHEREAS, all things necessary have been done to make the 2014 Notes, when issued, authenticated and delivered under the Indenture, the valid obligations
of the Issuer, and to make this First Supplemental Indenture a valid and legally binding agreement of the Issuer, in accordance with their and its terms; 
 NOW, THEREFORE: 
 In consideration of the premises provided for herein, the Issuer and the Trustee mutually
covenant and agree for the equal and proportionate benefit of all holders of the 2014 Notes as follows: 
 ARTICLE 1 
 THE 2014 NOTES 
 SECTION 1.1.
Designation of Notes; Establishment of Form. 
 There shall be a series of Notes designated “7.5% Senior Notes due 2014” of the
Issuer, and the form thereof shall be substantially as set forth in Exhibit A hereto, which is incorporated into and shall be deemed a part of this First Supplemental Indenture, and may have such letters, numbers or other marks of identification or
designation and such legends or endorsements placed thereon as may, consistently with the Indenture, be determined by the officers of the managing member of the Issuer executing such 2014 Notes, as evidenced by their execution of the 2014 Notes.

 The 2014 Notes will initially be issued exclusively in the form of one or more Global Notes, and The
Depository Trust Company is hereby designated by the Issuer as the Depositary with respect to the 2014 Notes. 
 SECTION 1.2. Amount,
Etc. 
 The Trustee shall authenticate and deliver 2014 Notes for original issue in an aggregate principal amount of $500,000,000, all
upon delivery to the Trustee of a written order by the Issuer for the authentication and delivery of 2014 Notes. 
 2014 Notes aggregating
$500,000,000 shall be issued in the form of a Rule 144A Global Note, and a “zero balance” Regulation S Temporary Global Note shall also be issued for later use. 
 The authorized aggregate principal amount of 2014 Notes may be increased at any time hereafter and such series may be reopened for issuances of
additional 2014 Notes as provided in the last paragraph of Section 2.01 of the Original Indenture, so long as (i) no Event of Default has occurred and is then continuing with respect to the 2014 Notes and (ii) such additional 2014
Notes are fungible for U.S. federal income tax purposes with the 2014 Notes issued on the date hereof so that such additional 2014 Notes will trade as part of a single series with the 2014 Notes issued on the date hereof. The 2014 Notes issued on
the date hereof and any additional 2014 Notes that may be issued hereafter shall be treated as a single class for all purposes of the Indenture, including waivers, amendments, redemption and offers to purchase. 
 Unless the context otherwise requires, all references in the Indenture to the 2014 Notes include the 2014 Notes issued on the date hereof and any
additional 2014 Notes that may be issued hereafter. 
 Any other series of Notes that may be issued under the Indenture after the date hereof
shall not vote together with the 2014 Notes as a single series or class on any matters. 
 SECTION 1.3. Redemption and Repurchase.

 There shall be no sinking fund for the retirement of the 2014 Notes or other mandatory redemption or repurchase obligation. 

The Issuer, at its option, may redeem the 2014 Notes in accordance with the provisions of the form of the 2014 Notes set forth in Exhibit A hereto and
Article Three of the Original Indenture. With respect to the 2014 Notes, the number of basis points referred to in the definition of “Make-Whole Premium” in Section 1.01 of the Original Indenture is 50. 
 SECTION 1.4. Conversion. 
 The
2014 Notes shall not be convertible into any other securities. 
  

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 SECTION 1.5. Maturity. 
 The principal of the 2014 Notes shall mature in installments as provided in the form of the 2014 Notes set forth in Exhibit A, and the Final Maturity Date
of the 2014 Notes shall be May 31, 2014. 
 SECTION 1.6. Other Terms of Notes. 
 Without limiting the foregoing provisions of this Article 1, the terms of the 2014 Notes shall be as provided in the form of the 2014 Notes set forth in
Exhibit A hereto and as provided in the Indenture. 
 ARTICLE 2 
 MISCELLANEOUS PROVISIONS 
 SECTION 2.1. Integral Part. 
 This First Supplemental Indenture constitutes an integral part of the Indenture. 
 SECTION 2.2. Rules of Construction. 
 For all purposes of this First Supplemental Indenture: 
 (a) capitalized terms used herein without definition shall have the
meanings specified in the Original Indenture; 
 (b) the terms “herein,” “hereof,” “hereunder” and other words
of similar import refer to this First Supplemental Indenture; and 
 (c) references to the “Notes” in the definition of
“Permitted Refinancing Indebtedness” in the Original Indenture and in the proviso to clause (ii) of Section 4.13 thereof shall be deemed to refer only to the 2014 Notes. 
 SECTION 2.3. Adoption, Ratification and Confirmation. 
 The Original Indenture, as supplemented and amended by the First Supplemental Indenture, is in all respects hereby adopted, ratified and confirmed. 
 SECTION 2.4. Counterparts. 
 This
First Supplemental Indenture may be executed in any number of counterparts, each of which when so executed shall be deemed an original; and all such counterparts shall together constitute but one and the same instrument. The exchange of copies of
this First Supplemental Indenture and of signature pages by facsimile or PDF transmission shall constitute effective execution and delivery of this First Supplemental Indenture as to the parties hereto and may be used in lieu of the original First
Supplemental Indenture for all purposes. Signatures of the parties hereto transmitted by facsimile or PDF shall be deemed to be their original signatures for all purposes. 
  

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 SECTION 2.5. Benefits of Indenture. 
 Nothing in this First Supplemental Indenture or in the 2014 Notes, express or implied, shall give to any Person (other than the parties hereto and the
holders of the 2014 Notes) any benefit or any legal or equitable right, remedy or claim under the Indenture. 
 SECTION 2.6.
Governing Law. 
 THIS FIRST SUPPLEMENTAL INDENTURE AND THE 2014 NOTES SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS
OF THE STATE OF NEW YORK 
 SECTION 2.7. Supplemental Indenture Controls. 
 In the event there is any conflict or inconsistency between the Original Indenture and this First Supplemental Indenture, the provisions of this First
Supplemental Indenture shall control. 
 SECTION 2.8. Trustee. 
 The Trustee makes no representations as to the validity or sufficiency of this First Supplemental Indenture. The recitals and statements herein are deemed
to be those of the Issuer and not the Trustee. 
  

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 IN WITNESS WHEREOF, the parties hereto have caused this First Supplemental Indenture to be duly
executed as of the day and year first written above. 
  

			
	MARITIMES & NORTHEAST PIPELINE, L.L.C.
		
	By:	 	M&N Management Company,
		 	its Managing Member
		
	By:	 	 /s/ Allen Capps

	Name:	 	Allen Capps
	Title:	 	Vice President
	
	DEUTSCHE BANK TRUST COMPANY AMERICAS,
	as Trustee
		
	By:	 	 /s/ Annie Jaghatspanyan

	Name:	 	 Annie Jaghatspanyan

	Title:	 	 Vice President

		
	By:	 	 /s/ Wanda Camacho

	Name:	 	 Wanda Camacho

	Title:	 	 Vice President

  

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 EXHIBIT A 
 FORM OF NOTE 
 [FORM OF FACE OF 2014 NOTE] 
 [INCLUDE IF NOTE IS A REGULATION S TEMPORARY NOTE] 
 THE RIGHTS ATTACHING TO THIS REGULATION S TEMPORARY GLOBAL NOTE, AND THE CONDITIONS AND PROCEDURES GOVERNING ITS EXCHANGE FOR CERTIFICATED NOTES, ARE AS SPECIFIED IN THE INDENTURE (AS DEFINED HEREIN). NEITHER THE
HOLDER NOR THE BENEFICIAL OWNERS OF THIS REGULATION S TEMPORARY GLOBAL NOTE SHALL BE ENTITLED TO RECEIVE PAYMENT OF INTEREST HEREON. 
 [INCLUDE IF NOTE IS A GLOBAL NOTE] 
 UNLESS THIS NOTE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY
TRUST COMPANY (55 WATER STREET, NEW YORK, NEW YORK) (“DTC”) TO THE COMPANY OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY NOTE IS REGISTERED IN THE NAME OF CEDE & CO., OR IN SUCH OTHER NAME AS IS REQUESTED
BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY
PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN. 
 TRANSFERS OF THIS NOTE
SHALL BE LIMITED TO TRANSFERS IN WHOLE, BUT NOT IN PART, TO DTC, TO NOMINEES OF DTC OR TO A SUCCESSOR THEREOF OR SUCH SUCCESSOR’S NOMINEE AND TRANSFERS OF PORTIONS OF THIS NOTE SHALL BE LIMITED TO TRANSFERS MADE IN ACCORDANCE WITH THE
RESTRICTIONS SET FORTH IN SECTION 2.06 OF THE INDENTURE REFERRED TO ON THE REVERSE HEREOF. 
 [INCLUDE IF NOTE IS A RULE 144A GLOBAL
NOTE OR ANY CERTIFICATED NOTE ISSUED IN ACCORDANCE WITH SECTION 2.05 OF THE INDENTURE IN EXCHANGE FOR SUCH A GLOBAL NOTE] 
 THIS NOTE
HAS NOT BEEN REGISTERED UNDER THE U.S. SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”), AND, ACCORDINGLY, MAY NOT BE OFFERED, SOLD, PLEDGED OR OTHERWISE TRANSFERRED WITHIN THE UNITED STATES OR TO, OR 

  

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FOR THE ACCOUNT OR BENEFIT OF, U.S. PERSONS, EXCEPT AS SET FORTH IN THE FOLLOWING SENTENCE. BY ITS ACQUISITION HEREOF OR OF A BENEFICIAL INTEREST HEREIN,
THE HOLDER: 
 (1) REPRESENTS THAT IT IS A “QUALIFIED INSTITUTIONAL BUYER” (AS DEFINED IN RULE 144A UNDER THE SECURITIES
ACT) (A “QIB”); 
 (2) AGREES THAT IT WILL NOT, PRIOR TO THE EXPIRATION OF THE HOLDING PERIOD APPLICABLE TO SALES OF THIS
NOTE UNDER RULE 144 UNDER THE SECURITIES ACT (OR ANY SUCCESSOR PROVISION), RESELL OR OTHERWISE TRANSFER THIS NOTE EXCEPT (A) TO THE ISSUER OR ANY OF ITS SUBSIDIARIES, (B) TO A PERSON WHOM THE SELLER REASONABLY BELIEVES IS A QIB PURCHASING
FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF A QIB IN A TRANSACTION MEETING THE REQUIREMENTS OF RULE 144A, (C) IN AN OFFSHORE TRANSACTION MEETING THE REQUIREMENTS OF REGULATION S UNDER THE SECURITIES ACT, (D) IN A TRANSACTION MEETING THE
REQUIREMENTS OF RULE 144 UNDER THE SECURITIES ACT, (E) IN ACCORDANCE WITH ANOTHER EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT (AND BASED UPON AN OPINION OF COUNSEL ACCEPTABLE TO THE ISSUER), OR (F) PURSUANT TO AN
EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT AND, IN EACH CASE, IN ACCORDANCE WITH THE APPLICABLE SECURITIES LAWS OF ANY STATE OF THE UNITED STATES OR ANY OTHER APPLICABLE JURISDICTION; AND 
 (3) AGREES THAT IT WILL DELIVER TO EACH PERSON TO WHOM THIS NOTE OR AN INTEREST HEREIN IS TRANSFERRED A NOTICE SUBSTANTIALLY TO THE EFFECT OF THIS
LEGEND. 
 AS USED HEREIN, THE TERMS “OFFSHORE TRANSACTION” AND “UNITED STATES” HAVE THE MEANINGS GIVEN TO THEM BY
RULE 902 OF REGULATION S UNDER THE SECURITIES ACT. THE INDENTURE GOVERNING THIS NOTE CONTAINS A PROVISION REQUIRING THE TRUSTEE TO REFUSE TO REGISTER ANY TRANSFER OF THIS NOTE IN VIOLATION OF THE FOREGOING RESTRICTIONS. 
  

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	No. [RA-  ] [RTRS-    ]	  		  	$                            
			
	CUSIP No.                    	  		  	[ISIN                     ]

 MARITIMES & NORTHEAST PIPELINE, L.L.C. 
 7.5% SENIOR NOTE DUE 2014 
 MARITIMES & NORTHEAST PIPELINE, L.L.C., a limited liability company duly organized and existing under the laws of the State of Delaware (herein referred to as the “Issuer” or the “Company,” which
term includes any successor Person under the Indenture), for value received, hereby promises to pay to                      or registered assigns,
the principal sum equal to              Dollars ($            ) [Insert if Note is in a global form—or such other
principal sum as shall be set forth in the Schedule of Exchanges of Interests in the Global Note attached hereto], such payment to be made in installments in the amounts and on the Principal Payment Dates indicated in the Installment Payment
Schedule attached hereto and to pay interest on the unpaid principal balance hereof from and including May 14, 2009, or from and including the most recent interest payment date (each such date, an “Interest Payment Date”) to
which interest has been paid or duly provided for, payable semiannually in arrears on May 31 and November 30 of each year, commencing on November 30, 2009 at the rate of 7.5% per annum until all of the principal hereof shall have
become due and payable, and on any overdue principal and any Make-Whole Premium, and (to the extent that payment of such interest is enforceable under applicable law) on any overdue installment of interest at the same rate per annum. The amount of
interest payable on any Interest Payment Date shall be computed on the basis of a 360-day year of twelve 30-day months. In the event that any date on which principal or interest is payable on this Note is not a Business Day, then payment of
principal or interest payable on such date will be made on the next succeeding day which is a Business Day (and without any interest or other payment in respect of any such delay), with the same force and effect as if made on such date. The
principal or interest installment so payable, and punctually paid or duly provided for on any Scheduled Payment Date will, as provided in the Indenture, be paid to the Person in whose name this Note (or one or more Predecessor Notes, as defined in
the Indenture) is registered at the close of business on the May 15 or November 15 (whether or not a Business Day), respectively, preceding that Scheduled Payment Date (each, a “Record Date”). Any such principal or
interest installment not punctually paid or duly provided for on any Scheduled Payment Date shall forthwith cease to be payable to the registered holder on the relevant Record Date, and may be paid to the Person in whose name this Note (or one or
more Predecessor Notes) is registered at the close of business on a special record date to be fixed by the Trustee for the payment of such defaulted principal or interest, notice whereof shall be given to the registered holders of this series of
Notes not less than 10 days prior to such special record date, or may be paid at any time in any other lawful manner not inconsistent with the requirements of any securities exchange on which the Notes may then be listed, and upon such notice as may
be required by such exchange, all as more fully provided in the Indenture hereinafter referred to. The principal of (and premium, if any) and the interest on this Note shall be payable at the office or agency of the Company maintained for that
purpose in accordance with Section 4.02 of the Indenture, in Dollars; provided, however, that [include if Note is in certificated form — such payment may be made at the option of the Company by check mailed to the registered holder
at such address as shall appear in the Note Register or, with respect to a 

  

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registered holder of $1,000,000 or more in aggregate principal amount of Notes who has delivered a written request to the Trustee at least five
(5) Business Days prior to the relevant Scheduled Payment Date electing to have payments made by wire transfer to a designated account in the United States, by wire transfer of immediately available funds to such designated account;
provided further, however, that, in either case, the payment of the principal with respect to any such Note due upon redemption or at the Final Maturity Date will be made only upon surrender of that Note to the Trustee] [include
if Note is in global form — payment of principal, premium, if any, and interest shall be made by the Company in immediately available funds by wire transfer to the Depositary or its nominee]. 
 No recourse under or upon any obligation, covenant or agreement of the Indenture or this Note, or for any claim based thereon or otherwise in respect
thereof, shall be had against any stockholder, Member, Sponsor, employee, manager, Affiliate, officer or director, past, present or future as such, of any stockholder, Member or Sponsor, or of the Company or any predecessor or successor of the
Company, either directly or through the Company or any such predecessor or successor of the Company, whether by virtue of any constitution, statute or rule of law, or by the enforcement of any assessment or penalty or otherwise; it being expressly
understood that the Indenture and this Note and the obligations issued hereunder are solely obligations of the Company, and that no such personal liability whatever shall attach to, or is or shall be incurred by, the stockholders, Members,
employees, managers, Affiliates, officers or directors as such, of any stockholder, Member or Sponsor, or of the Company or of any predecessor or successor of the Company, or any of them, because of the creation of the indebtedness evidenced hereby,
or under or by reason of the obligations, covenants or agreements contained in the Indenture or this Note; and that any and all such personal liability of every name and nature, either at common law, in equity or by constitution or statute, of, and
any and all such rights and claims against, every such stockholder, Member, Sponsor, employee, manager, Affiliate, officer or director as such, because of the creation of the indebtedness evidenced hereby, or under or by reason of the obligations,
covenants or agreements contained in the Indenture or this Note or implied therefrom, are hereby expressly waived and released as a condition of, and as a consideration for, the execution of the Indenture and the issuance of this Note. 

This Note shall not be entitled to any benefit under the Indenture hereinafter referred to or be valid or become obligatory for any purpose until the
Certificate of Authentication hereon shall have been signed by or on behalf of the Trustee. 
 The provisions of this Note are continued on
the reverse side hereof and such continued provisions shall for all purposes have the same effect as though fully set forth at this place. 
  

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 IN WITNESS WHEREOF, the Company has caused this Instrument to be executed. 
  

			
	MARITIMES & NORTHEAST PIPELINE, L.L.C.
		
	By:	 	M&N Management Company,
		 	its Managing Member
		
	By:	 	  

  

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 CERTIFICATE OF AUTHENTICATION 
 This is one of the Notes of the series designated therein referred to in the within-mentioned Indenture. 
  

			
	DEUTSCHE BANK TRUST
	 COMPANY AMERICAS,
 as
Trustee

		
	 By:
	 	  

		 	Authorized Signatory

  

			
	 Dated:
	 	  

  

 A-6 

 [FORM OF REVERSE OF NOTE] 
 7.5% SENIOR NOTE DUE 2014 
 This Note is one of a duly authorized issue of senior notes of the
Company (herein sometimes referred to as the “Notes”), all issued or to be issued in one or more series under and pursuant to an Indenture dated as of May 14, 2009, duly executed and delivered between the Company and Deutsche
Bank Trust Company Americas, a New York banking corporation, as Trustee (the “Trustee”, which term includes any successor trustee under the Indenture), (such Indenture, as amended and supplemented by the First Supplemental Indenture
of even date therewith, being referred to herein as the “Indenture”) to which Indenture reference is hereby made for a description of the rights, limitation of rights, obligations, duties and immunities thereunder of the Trustee,
the Company and the holders of the Notes. By the terms of the Indenture, the Notes are issuable in series which may vary as to amount, date of maturity, rate of interest and in other respects as in the Indenture provided. This series of Notes is
designated as the “7.5% Senior Notes due 2014” and is initially limited to the aggregate principal amount of $500,000,000. 
 The
Notes of this series may be redeemed in whole or in part (if in part, on a pro rata basis, by lot or by such other method as the Trustee shall deem fair or appropriate (except (i) if the Notes are listed on any national securities exchange, in
compliance with the requirements of the principal national securities exchange on which the Notes are listed, as such requirements shall be certified to the Trustee by the Company in an Officer’s Certificate or (ii) if otherwise required
by law)), prior to the Final Maturity Date at the option of the Company, at any time and from time to time, upon mailing a notice of such redemption not less than 30 nor more than 60 days prior to the date fixed for redemption to the holders of
Notes, all as provided in the Indenture, at a redemption price equal to 100% of the principal amount of the Notes to be redeemed, plus the applicable Make-Whole Premium, plus accrued and unpaid interest, if any, on such Notes to, but excluding, the
date of redemption. 
 In the event of redemption of this Note in part only, a new Note or Notes of this series for the unredeemed portion
hereof will be issued in the name of the holder hereof upon the cancellation hereof. 
 In case an Event of Default, as defined in the
Indenture, with respect to the Notes of this series shall have occurred and be continuing, the principal of all of the Notes of this series may be declared, and upon such declaration shall become (or, in the case of an Event of Default specified in
Section 6.01(a)(iv) or (v) of the Indenture, shall become automatically), due and payable, in the manner, with the effect and subject to the conditions provided in the Indenture. 
 The Indenture contains provisions for defeasance at any time of (i) the entire indebtedness of the Notes of this series and (ii) certain
restrictive covenants, in either case upon compliance by the Company with certain conditions set forth therein. 
 The Indenture contains
provisions permitting the Company and the Trustee, with the consent of the holders of a majority in aggregate principal amount of the Notes of each series affected at the time Outstanding, as defined in the Indenture, to execute supplemental
indentures 

  

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for the purpose of adding any provisions to, changing in any manner or eliminating any of the provisions of the Indenture or of any supplemental indenture or
of modifying in any manner the rights of the holders of the Notes; provided, however, that no such supplemental indenture shall (i) change the fixed maturity of any Notes of any series, or alter or waive any of the provisions with
respect to the redemption of the Notes, alter or waive any provisions relating to waivers of past Defaults or the rights of Noteholders to receive payments of principal of, or interest or premium, if any, on, the Notes, reduce the principal amount
thereof, reduce the rate or extend the time of payment of interest (including default interest) thereon, reduce any premium (including the Make-Whole Premium) payable upon the redemption thereof, waive a Default or Event of Default in the payment of
principal of, or premium, if any, or interest on, the Notes (except a rescission of acceleration of the Notes of a series by holders of at least a majority in aggregate principal amount of the then Outstanding Notes of such series and a waiver of
the payment default that resulted from such acceleration), change the currency in which any payment on the Notes is payable or impair the right to institute suit for the enforcement of any such payment on or after the date such payment is due,
(ii) reduce the aforesaid percentage of Notes, the holders of which are required to consent to any such supplemental indenture, or modify any provision of Section 6.01(c) of the Indenture (except to increase the percentage of the principal
amount of Notes required to rescind and annul any declaration of amounts due and payable under the Notes) or (iii) make any change in the amendment and waiver provisions of the Indenture, without the consent of the holder of each Note then
Outstanding and affected thereby. The Indenture also contains provisions permitting the holders of a majority in aggregate principal amount of the Notes of a series at the time Outstanding affected thereby, on behalf of the holders of the Notes of
such series, to waive any past default or Event of Default in the performance of any of the covenants contained in the Indenture, or established pursuant to the Indenture with respect to such series, and its consequences, except a default in the
payment of the principal of, or premium, if any, or interest on, any of the Notes of such series as and when the same shall become due by the terms of such Notes, which default may be waived by the unanimous consent of the holders affected. Any such
consent or waiver by the holder of this Note (unless revoked as provided in the Indenture) shall be conclusive and binding upon such holder and upon all future holders and owners of this Note and of any Note issued in exchange herefor or in place
hereof (whether by registration of transfer or otherwise), irrespective of whether or not any notation of such consent or waiver is made upon this Note. 
 No reference herein to the Indenture and no provision of this Note or of the Indenture shall alter or impair the obligation of the Company, which is absolute and unconditional, to pay the principal of and premium, if
any, and interest on this Note at the time and place and at the rate and in the money herein prescribed. 
 As provided in the Indenture and
subject to certain limitations therein set forth, this Note is transferable by the registered holder hereof on the Note Register of the Company, upon surrender of this Note for registration of transfer at the office or agency of the Company
designated for such purpose in accordance with Section 4.02 of the Indenture, accompanied by a written instrument or instruments of transfer in form satisfactory to the Company and the Trustee duly executed by the registered holder hereof or
its attorney duly authorized in writing, and thereupon one or more new Notes of authorized denominations and for the same aggregate principal amount and series will be issued to the designated transferee or transferees. No service charge will be
made for any such transfer, but the Company may require payment of a sum sufficient to cover any tax or other governmental charge payable in relation thereto. 
  

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 Prior to due presentment for registration of transfer of this Note, the Company, the Trustee, any paying
agent and any Note Registrar may deem and treat the registered holder hereof as the absolute owner hereof (whether or not this Note shall be overdue and notwithstanding any notice of ownership or writing hereon made by anyone other than the Note
Registrar) for the purpose of receiving payment of or on account of (subject to Section 2.03 of the Indenture) the principal hereof and premium, if any, and (also subject to Section 2.03 of the Indenture) interest due hereon and for all
other purposes, and neither the Company nor the Trustee nor any paying agent nor any Note Registrar shall be affected by any notice to the contrary. 
 The Notes of this series are issuable in registered form without coupons in denominations of $100,000 and integral multiples of $1,000 in excess thereof. As provided in the Indenture and subject to certain limitations
herein and therein set forth, Notes of this series so issued are exchangeable for a like aggregate principal amount of Notes of this series of a different authorized denomination, as requested by the holder surrendering the same. 
 By accepting this Note, the holder will be deemed to have acknowledged and agreed that it has no right as a third party beneficiary to enforce any
provision of (i) any material operative document of the Issuer referred to in the offering circular of the Issuer relating to the Notes of this series or (ii) its FERC Gas Tariff, First Revised Volume No. 1. 
 The laws of the State of New York will govern and be used to construe the Indenture and the Notes. 
 All terms used in this Note which are defined in the Indenture shall have the meanings assigned to them in the Indenture. 
  

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 TRANSFER NOTICE 
 FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and transfer(s) unto
                                         
                whose taxpayer identification number is
                                         and
whose address including postal/zip code is                              the within Note and all rights
thereunder, hereby irrevocably constituting and appointing
                                        
attorney-in-fact to transfer said Note on the books of the Company with full power of substitution in the premises. 
 [Include if Note is a
Rule 144A Global Note or any certificated Note issued in accordance with Section 2.05 of the Indenture in exchange for such a Global Note: 
 In connection with the transfer of this Note, the undersigned certifies that: 
 (Check one) 
  

					
	  ̈
	  	(a)	  	This Note is being transferred to a Person the transferor reasonably believes is a “qualified institutional buyer” (as defined in Rule 144A under the Securities Act) in compliance with
Rule 144A.
			
	  ̈
	  	(b)	  	This Note is being transferred outside the United States in compliance with Rule 904 of Regulation S under the Securities Act.
			
	  ̈
	  	(c)	  	This Note is being transferred to Maritimes & Northeast Pipeline, L.L.C. or any of its subsidiaries.
			
	  ̈
	  	(d)	  	This Note is being transferred pursuant to the exemption from registration provided by Rule 144 under the Securities Act.
			
	  ̈
	  	(e)	  	This Note is being transferred in accordance with another exemption from the registration requirements of the Securities Act.
			
	  ̈
	  	(f)	  	This Note is being transferred pursuant to a registration statement that has been declared effective under the Securities Act.]

  

 A-10 

											
	Dated:	 	  
	 		 		 	Name:	 	  

		 		 		 		 	By:	 	  

		 		 		 		 	Title:	 	  

				
		 		 		 	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 whatsoever.
					
		 		 		 		 	SIGNATURE GUARANTEED*
					
		 		 		 		 	  

  

	*	Participant in a recognized Signature Guarantee Medallion Program (or other signature satisfactory to the Trustee). 

  

 A-11 

 SCHEDULE OF EXCHANGES OF INTERESTS IN THE GLOBAL NOTE 
 The following exchanges of a part of this Global Note for an interest in another Global Note or for a certificated Note, or exchanges of a part of
another Global Note or certificated Note for an interest in this Global Note, have been made: 
  

									
	 Date of Exchange
	 	 Amount of decrease
 in Principal Amount
 of this
Global Note
	 	 Amount of increase
 in Principal Amount
 of this
Global Note
	 	 Principal Amount of
 this Global Note
 following such
 decrease (or
 increase)
	 	 Signature of
 authorized signatory
 of Trustee or
 Custodian

		 		 		 		 	
		 		 		 		 	
		 		 		 		 	

  

 A-12 

 INSTALLMENT PAYMENT SCHEDULE 
 Installments of principal on the within Note shall be payable on each Principal Payment Date indicated below, and the amount of each such installment shall be calculated as the product of the percentage specified
below for such Principal Payment Date multiplied by the original principal amount of such Note (with any fraction of $1.00 being rounded upwards or downwards to the nearest $1.00 as provided in Section 4.01(c) of the Indenture): 
  

				
	 Principal Payment Date
	  	Percentage	 
		
	 November 30, 2009
	  	1.91	% 
	 May 31, 2010
	  	2.05	  
	 November 30, 2010
	  	2.15	  
	 May 31, 2011
	  	2.01	  
	 November 30, 2011
	  	2.05	  
	 May 31, 2012
	  	1.99	  
	 November 30, 2012
	  	2.04	  
	 May 31, 2013
	  	1.76	  
	 November 30, 2013
	  	1.76	  
	 May, 31, 2014
	  	82.28	  
		  	 	 
		  	100.00	% 
		  	 	 

  

 A-13Tax Matters Agreement

 EXHIBIT 10.1 
 EXECUTION COPY 
 TAX MATTERS AGREEMENT 
 by and among 
 DUKE ENERGY CORPORATION, 
 SPECTRA ENERGY CORP, 
 and

 THE OTHER SPECTRA ENERGY PARTIES 
 Dated as of 
 December 13, 2006 

 TAX MATTERS AGREEMENT 
 THIS TAX MATTERS AGREEMENT is entered into as of December 13, 2006, by and among Duke Energy Corporation, a Delaware corporation (“Duke
Energy”), Spectra Energy Corp (f/k/a Gas SpinCo, Inc.), a Delaware corporation (“Spectra Energy”), and each of the Other Spectra Energy Parties; each a “Party” and collectively, the “Parties”.

 R E C I T A L S: 
 WHEREAS, Duke Energy, acting through its direct and indirect subsidiaries, currently conducts a number of businesses, including (i) the Gas Business, and (ii) the Power Business; 
 WHEREAS, as of the date hereof, Duke Energy and its direct and indirect domestic subsidiaries are members of an Affiliated Group, of which Duke Energy is
the common parent; 
 WHEREAS, the Board of Directors of Duke Energy has determined that it is appropriate, desirable and in the best
interests of Duke Energy and its stockholders to separate Duke Energy into two separate, independent and publicly traded companies: (i) one comprising the Gas Business, which shall be owned and conducted, directly or indirectly, by Spectra
Energy, and (ii) one comprising the Power Business which shall continue to be owned and conducted, directly or indirectly, by Duke Energy (the “Separation”); 
 WHEREAS, in order to effect the Separation, (i) Duke Energy Services Inc. intends to transfer certain Gas Assets and Gas Liabilities to Duke Energy
Enterprises Corp. (“Internal Contribution 1”) and distribute the stock of Duke Energy Enterprises Corp. to PanEnergy Corp. (“Internal Distribution 1”); (ii) PanEnergy Corp. intends to transfer certain Gas
Assets and Gas Liabilities to Duke Energy Enterprises Corp. (“Internal Contribution 2”) and distribute the stock of Duke Energy Enterprises Corp. to Duke Energy Registration Services, Inc. (“Internal Distribution
2”); (iii) Duke Energy Registration Services, Inc. intends to transfer certain Gas Assets and Gas Liabilities to Duke Energy Enterprises Corp. (“Internal Contribution 3” and together with Internal Contribution 1 and
Internal Contribution 2, the “Internal Contributions”) and distribute the stock of Duke Energy Enterprises Corp. to Duke Capital, LLC (“Internal Distribution 3,” and together with Internal Distribution 1 and
Internal Distribution 2, the “Internal Distributions”); and (iv) Duke Energy intends to transfer the membership interests of Duke Capital LLC to Spectra Energy (the “Contribution”) and distribute all of the
issued and outstanding shares of common stock of Spectra Energy, on a pro rata basis (the “Distribution,” and together with the Internal Contributions, Internal Distributions and the Contribution, the “Spin-Off”) to
the holders of the outstanding common stock of Duke Energy. 
 WHEREAS, Duke Energy and Spectra Energy have determined that it is necessary
and desirable, as part of the Separation, to allocate, transfer, retain or assign to the Spectra Energy Group, the Gas Assets and Gas Liabilities, and to allocate, transfer, retain or assign to the Duke Energy Group, the Power Assets and Power
Liabilities; 
 WHEREAS, to effect this separation Duke Energy and Spectra Energy entered into that certain Separation and Distribution
Agreement dated as of even date hereof (as amended or otherwise modified from time to time, the “Separation Agreement”); 
  

 1 

 WHEREAS, it is the intention of the Parties that Internal Contribution 1 and Internal Distribution 1
together qualify as a reorganization within the meaning of sections 368(a)(1)(D) and 355 of the Code; 
 WHEREAS, it is the intention of the
Parties that Internal Contribution 2 and Internal Distribution 2 together qualify as a reorganization within the meaning of sections 368(a)(1)(D) and 355 of the Code; 
 WHEREAS, it is the intention of the Parties that Internal Contribution 3 and Internal Distribution 3 together qualify as a reorganization within the meaning of sections 368(a)(1)(D) and 355 of the Code; 
 WHEREAS, it is the intention of the Parties that the Contribution, and the Distribution together qualify as a reorganization within the meaning of
sections 368(a)(1)(D) and 355 of the Code; 
 WHEREAS, in contemplation of the Separation, pursuant to which the Spectra Energy Group will
cease to be members of the Affiliated Group of which Duke Energy is the parent, if (but only if) the Distribution occurs, the Parties have determined to enter into this Agreement, setting forth their agreement with respect to certain tax matters;
and 
 NOW, THEREFORE, in consideration of the foregoing premises, the mutual promises and covenants hereinafter set forth, and other good
and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Parties, intending to be legally bound, agree as follows: 
 Section 1. Definitions. 
 Capitalized terms used in this Agreement and not otherwise defined in this Section 1
shall have the meanings set forth in the Separation Agreement. As used in this Agreement, the following capitalized terms shall have the following meanings: 
 “Affiliated Group” means an affiliated group of corporations within the meaning of section 1504(a)(1) of the Code that files a consolidated return for United States federal Income Tax purposes.

 “After Tax Amount” means any additional amount necessary to reflect the hypothetical Tax consequences of the receipt or
accrual of any payment required to be made under this Agreement (including payment of an additional amount or amounts hereunder and the effect of the deductions available for interest paid or accrued and for Taxes such as state and local Income
Taxes), determined by using the highest applicable statutory corporate Income Tax rate (or rates, in the case of an item that affects more than one Tax) for the relevant taxable period (or portion thereof). 
 “Agreement” shall have the meaning set forth in the preamble hereto. 
  

 2 

 “Audit” means any audit, assessment of Taxes, other examination by any Taxing Authority,
proceeding, or appeal of such a proceeding relating to Taxes, whether administrative or judicial, including proceedings relating to competent authority determinations. 
 “Business Day” shall have the meaning set forth in the Separation Agreement. 
 “Carryback Period” shall have the meaning set forth in Section 4.02. 
 “Code” means the
Internal Revenue Code of 1986, as amended. 
 “Combined Return” means any Tax Return, other than with respect to United
States federal Income Taxes, filed on a consolidated, combined (including nexus combination, worldwide combination, domestic combination, line of business combination or any other form of combination) or unitary basis wherein Spectra Energy or one
or more Spectra Energy Affiliates join in the filing of such Tax Return (for any taxable period or portion thereof) with Duke Energy or one or more Duke Energy Affiliates. 
 “Consolidated Return” means any Tax Return with respect to United States federal Income Taxes filed on a consolidated basis wherein
Spectra Energy or one or more Spectra Energy Affiliates join in the filing of such Tax Return (for any taxable period or portion thereof) with Duke Energy or one or more Duke Energy Affiliates. 
 “Contribution” shall have the meaning set forth in the recitals hereto. 
 “Deferred Intercompany Item” shall mean any income, gain, deduction or loss from transactions between members of the same Affiliated
Group that is deferred for U.S. federal income tax purposes under the principles in Treasury Regulations § 1.1502-13, or any similar provision under state, local or foreign law. 
 “Distribution” shall have the meaning set forth in the recitals hereto. 
 “Distribution Date” shall have the meaning set forth in the Separation Agreement. 
 “Distribution Taxes” means any Taxes imposed on, or increase in Taxes incurred by, Duke Energy or any Duke Energy Affiliate, and any
Taxes of a Duke Energy shareholder (or former Duke Energy shareholder) that are required to be paid or reimbursed by Duke Energy or any Duke Energy Affiliate pursuant to a Final Determination, provided that Duke Energy shall have vigorously defended
itself in any legal proceeding involving Taxes of a Duke Energy shareholder, (without regard to whether such Taxes are offset or reduced by any Tax Asset, Tax Item, or otherwise) resulting from, or arising in connection with, the failure of Internal
Contribution 1, Internal Distribution 1, Internal Contribution 2, Internal Distribution 2, Internal Contribution 3, Internal Distribution 3, the Contribution or the Distribution to qualify as a transaction in which no income, gain or loss is
recognized pursuant to sections 355 and 368(a)(1)(D) of the Code (including any Tax resulting from the application of section 355(d) or section 355(e) of the Code to Internal Distribution 1, Internal Distribution 2, Internal Distribution 3 or the
Distribution) or corresponding provisions of the laws of any other jurisdictions. Any Income Tax referred to in the immediately preceding sentence shall be determined using the highest applicable statutory corporate Income Tax rate for the relevant
taxable period (or portion thereof). 
  

 3 

 “Duke Energy” shall have the meaning set forth in the preamble hereto. 
 “Duke Energy Affiliate” means any Person included in the Duke Energy Group. 
 “Duke Energy Business Records” shall have the meaning set forth in Section 9.01(c). 
 “Duke Energy Group” shall have the meaning set forth in the Separation Agreement. 
 “Duke Energy Separate Tax Liability” means an amount equal to the Tax liability that Duke Energy and each Duke Energy Affiliate would
have incurred if they had filed a consolidated return, combined return or a separate return, as the case may be, separate from the members of the Spectra Energy Group, for the relevant Tax period, and such amount shall be computed by Duke Energy in
a manner consistent with (i) general Tax accounting principles, (ii) the Code and the Treasury Regulations promulgated thereunder, and (iii) past practice, if any. For the avoidance of doubt, the Duke Energy Separate Tax Liability
shall in no event be less than zero. 
 “Duke Energy Stock Options” means options to acquire Duke Energy common stock.

 “Duke Energy Tax Acts” shall have the meaning set forth in Section 4.01(a). 
 “Effective Time” shall have the meaning set forth in the Separation Agreement. 
 “Estimated Tax Installment Date” means, with respect to United States federal Income Taxes, the estimated Tax installment due dates
prescribed in section 6655(c) of the Code and, in the case of any other Tax, means any other date on which an installment payment of an estimated amount of such Tax is required to be made. 
 “Exchangeco Tax” means any Tax imposed on Spectra Energy or any Spectra Energy Affiliate in connection with (i) the transfer of
shares of Duke Energy stock to Spectra Energy or any Spectra Energy Affiliate during any Post-Distribution Period in connection with a transfer of such stock to holders of Duke Energy Canada Exchangeco Inc. exchangeable shares; (ii) the
transfer of cash by Duke Energy to Spectra Energy or any Spectra Energy Affiliate in connection with any Duke Energy dividend; or (iii) the transfer of shares of Duke Energy stock to holders of Duke Energy Canada Exchangeco Inc. exchangeable
shares. 
 “Excluded Spectra Energy Affiliates” means Duke Energy Early Grove Company and Duke Energy Virginia Pipeline
Company. 
 “Filing Party” shall have the meaning set forth in Section 8.01. 
  

 4 

 “Final Determination” means the final resolution of liability for any Tax for any
taxable period, by or as a result of (i) a final and unappealable decision, judgment, decree or other order by any court of competent jurisdiction; (ii) a final settlement with the IRS, a closing agreement or accepted offer in compromise
under section 7121 or section 7122 of the Code, or a comparable agreement under the laws of other jurisdictions, which resolves the entire Tax liability for any taxable period; (iii) any allowance of a refund or credit in respect of an
overpayment of Tax, but only after the expiration of all periods during which such refund may be recovered by the jurisdiction imposing the Tax; or (iv) any other final disposition, including by reason of the expiration of the applicable
statute of limitations. 
 “Force Majeure” shall have the meaning set forth in the Separation Agreement. 
 “Gas Assets” shall have the meaning set forth in the Separation Agreement. 
 “Gas Business” shall have the meaning set forth in the Separation Agreement. 
 “Gas Liabilities” shall have the meaning set forth in the Separation Agreement. 
 “Income Tax” means any federal, state, local or foreign Tax determined (in whole or in part) by reference to net income, net worth,
gross receipts or capital, or any such Taxes imposed in lieu of such a Tax. For the avoidance of doubt, the term “Income Tax” includes any franchise Tax, net worth, gross receipts, capital or any such Taxes imposed in lieu of such a Tax.

 “Income Tax Return” means any Tax Return relating to any Income Tax. 
 “Internal Contribution 1” shall have the meaning set forth in the recitals hereto. 
 “Internal Contribution 2” shall have the meaning set forth in the recitals hereto. 
 “Internal Contribution 3” shall have the meaning set forth in the recitals hereto. 
 “Internal Contributions” shall have the meaning set forth in the recitals hereto. 
 “Internal Distribution 1” shall have the meaning set forth in the recitals hereto. 
 “Internal Distribution 2” shall have the meaning set forth in the recitals hereto. 
 “Internal Distribution 3” shall have the meaning set forth in the recitals hereto. 
 “Internal Distributions” shall have the meaning set forth in the recitals hereto. 
 “IRS” means the United States Internal Revenue Service or any successor thereto, including its agents, representatives, and attorneys.

 “IRS Ruling” means the private letter ruling issued by the IRS in connection with the Spin-Off, which is a condition to
the Distribution under the Separation Agreement. 
  

 5 

 “IRS Ruling Documents” means the request for the IRS Ruling filed with the IRS, together
with all supplemental filings or other materials subsequently submitted on behalf of Duke Energy, the Duke Energy Affiliates and Duke Energy’s shareholders to the IRS, the appendices and exhibits thereto, and the IRS Ruling itself. 

“Joint Responsibility Item” means any Tax Item, including Distribution Taxes, for which the non-Filing Party’s responsibility
under this Agreement could exceed one million dollars ($1,000,000), but not a Sole Responsibility Item. 
 “Non-Income Tax
Return” means any Tax Return relating to any Tax other than an Income Tax. 
 “Officer’s Certificate” means a
letter executed by an officer of Duke Energy or Spectra Energy and provided to Spin-Off Tax Counsel or Tax Counsel as a condition for the completion of the Spin-Off Tax Opinion, a Supplemental Tax Spin-Off Opinion or Supplemental Tax Opinion.

 “Other Spectra Energy Parties” means the entities listed in Schedule 1.1(129) of the Separation Agreement other
than Spectra Energy and the Excluded Spectra Energy Affiliates. 
 “Owed Party” shall have the meaning set forth in
Section 7.05. 
 “Owing Party” shall have the meaning set forth in Section 7.05. 
 “Parties” shall have the meaning set forth in the preamble hereto. 
 “Payment Period” shall have the meaning set forth in Section 7.05(e). 
 “Post-Distribution Period” means any taxable period beginning after the Distribution Date. 
 “Power Assets” shall have the meaning set forth in the Separation Agreement. 
 “Power Business” shall have the meaning set forth in the Separation Agreement. 
 “Power Liabilities” shall have the meaning set forth in the Separation Agreement. 
 “Pre-Distribution Period” means any taxable period beginning on or before the Distribution Date. 
 “Separation” shall have the meaning set forth in the preamble hereto. 
 “Separation Agreement” shall have the meaning set forth in the recitals hereto. 
  

 6 

 “Sole Responsibility Item” means any Tax Item for which the non-Filing Party has the
entire economic liability under this Agreement. 
 “Spectra Energy” shall have the meaning set forth in the preamble hereto.

 “Spectra Energy Affiliate” means any Person included in the Spectra Energy Group. 
 “Spectra Energy Business Records” shall have the meaning set forth in Section 9.01(c). 
 “Spectra Energy Group” shall have the meaning set forth in the Separation Agreement. 
 “Spectra Energy Separate Tax Liability” means an amount equal to the Tax liability that Spectra Energy and each Spectra Energy Affiliate
would have incurred if they had filed a consolidated return, combined return or a separate return, as the case may be, separate from the members of the Duke Energy Group, for the relevant Tax period, and such amount shall be computed by Duke Energy
in a manner consistent with (i) general Tax accounting principles, (ii) the Code and the Treasury Regulations promulgated thereunder, and (iii) past practice, if any. For the avoidance of doubt, the Spectra Energy Separate Tax
Liability shall in no event be less than zero, and nothing in this Agreement shall be construed to require compensation by Duke Energy for any losses of Spectra Energy or any Spectra Energy Affiliate. 
 “Spectra Energy Stock Options” means options to acquire Spectra Energy common stock. 
 “Spectra Energy Tax Acts” shall have the meaning set forth in Section 4.01(b). 
 “Spin-Off” shall have the meaning set forth in the recitals hereto. 
 “Spin-Off Tax Counsel” means Skadden, Arps, Slate, Meagher & Flom LLP. 
 “Spin-Off Tax Opinion” means the opinion to be issued by Spin-Off Tax Counsel, as one of the conditions to completing the Spin-Off,
addressing certain United States federal Income Tax consequences of the Spin-Off under section 355 of the Code. 
 “Supplemental Ruling” means any ruling (other than the IRS Ruling) issued by any Taxing Authority in connection with the Spin-Off. 
 “Supplemental Ruling Documents” means any request for a Supplemental Ruling, together with any supplemental filings or other materials subsequently submitted, the appendices and exhibits thereto, and
any Supplemental Rulings issued. 
 “Supplemental Spin-Off Tax Opinion” means any opinion (other than the Spin-Off
Tax Opinion) issued by any tax counsel in connection with the Spin-Off.  
 “Supplemental Tax Opinion” shall have the
meaning set forth in Section 4.04(d). 
  

 7 

 “Tax Asset” means any Tax Item that has accrued for Tax purposes, but has not been
realized during the taxable period in which it has accrued, and that could reduce a Tax in another taxable period, including a net operating loss, net capital loss, investment tax credit, foreign tax credit, charitable deduction or credit related to
alternative minimum tax or any other Tax credit. 
 “Tax Benefit” means a reduction in the Tax liability (or increase in
refund or credit or any item of deduction or expense) of a taxpayer (or of the Affiliated Group, or similar group of entities as defined under corresponding provisions of the laws of any other jurisdiction, of which it is a member) for any taxable
period. Except as otherwise provided in this Agreement, a Tax Benefit shall be deemed to have been realized or received from a Tax Item in a taxable period only if and to the extent that the Tax liability of the taxpayer (or of the Affiliated Group,
or similar group of entities as defined under corresponding provisions of the laws of any other jurisdiction, of which it is a member) for such period, after taking into account the effect of the Tax Item on the Tax liability of such taxpayer (or of
the Affiliated Group, or similar group of entities as defined under corresponding provisions of the laws of any other jurisdiction, of which it is a member) in the current period and all prior periods, is less than it would have been had such Tax
liability been determined without regard to such Tax Item. 
 “Tax Counsel” means a nationally recognized law firm mutually
agreed upon by Duke Energy and Spectra Energy to provide a Supplemental Tax Opinion. 
 “Tax Detriment” means an increase in
the Tax liability (or reduction in refund or credit or any item of deduction or expense) of a taxpayer (or of the Affiliated Group, or similar group of entities as defined under corresponding provisions of the laws of any other jurisdiction, of
which it is a member) for any taxable period. Except as otherwise provided in this Agreement, a Tax Detriment shall be deemed to have been realized or incurred from a Tax Item in a taxable period only if and to the extent that the Tax liability of
the taxpayer (or of the Affiliated Group, or similar group of entities as defined under corresponding provisions of the laws of any other jurisdiction, of which it is a member) for such period, after taking into account the effect of the Tax Item on
the Tax liability of such taxpayer (or of the Affiliated Group, or similar group of entities as defined under corresponding provisions of the laws of any other jurisdiction, of which it is a member) in the current period and all prior periods, is
more than it would have been had such Tax liability been determined without regard to such Tax Item. 
 “Tax Item” means any
item of income, gain, loss, deduction, expense or credit, or other attribute that may have the effect of increasing or decreasing any Tax. 
 “Tax Return” means any return, report, certificate, form or similar statement or document (including any related or supporting information or schedule attached thereto and any information return, amended tax return, claim
for refund or declaration of estimated Tax) required to be supplied to, or filed with, a Taxing Authority in connection with the determination, assessment or collection of any Tax or the administration of any laws, regulations or administrative
requirements relating to any Tax. 
 “Tax Material” shall have the meaning set forth in Section 9.01(a). 
  

 8 

 “Taxes” means all federal, state, local or foreign taxes, charges, fees, duties, levies,
imposts, rates or other assessments, including income, gross receipts, excise, property, sales, use, license, capital stock, transfer, franchise, payroll, withholding, social security, value added or other taxes, (including any interest, penalties
or additions attributable thereto) and a “Tax” shall mean any one of such Taxes. 
 “Taxing Authority” means any
governmental authority or any subdivision, agency, commission or authority thereof or any quasi-governmental or private body having jurisdiction over the assessment, determination, collection or imposition of any Tax (including the IRS). 

“U.S. Gas Transmission Business” means the U.S. Gas Transmission Business as defined in the IRS Ruling Documents. 
 Section 2. Preparation and Filing of Tax Returns. 
 2.01. Duke Energy’s Responsibility. Subject to the other applicable provisions of this Agreement, Duke Energy shall have sole and exclusive responsibility for the preparation and filing of: 
 (a) all Consolidated Returns and all Combined Returns for any taxable period; 
 (b) all Income Tax Returns (other than Consolidated Returns and Combined Returns) with respect to Duke Energy and/or any Duke Energy
Affiliate for any taxable period; 
 (c) all Non-Income Tax Returns with respect to Duke Energy, any Duke Energy Affiliate, or
the Power Business or any part thereof for any taxable period; and 
 (d) all Non-Income Tax Returns with respect to Spectra
Energy, any Spectra Energy Affiliate, or the Gas Business or any part thereof, that are required to be filed (taking into account any extension of time which has been requested or received) on or prior to the Distribution Date. 
 2.02. Spectra Energy’s Responsibility. Spectra Energy shall have sole and exclusive responsibility for the preparation and filing of:

 (a) all Income Tax Returns (other than Consolidated Returns and Combined Returns) with respect to Spectra Energy and/or any
Spectra Energy Affiliate for any taxable period; and 
 (b) all Non-Income Tax Returns with respect to Spectra Energy, any
Spectra Energy Affiliate, or the Gas Business or any part thereof, that are required to be filed (taking into account any extension of time which has been requested or received) after the Distribution Date. 
 2.03. RESERVED. 
  

 9 

 2.04. Agent. Subject to the other applicable provisions of this Agreement, Spectra Energy hereby
irrevocably designates, and agrees to cause each Spectra Energy Affiliate to so designate, Duke Energy as its sole and exclusive agent and attorney-in-fact to take such action (including execution of documents) as Duke Energy, in its sole
discretion, may deem appropriate in any and all matters (including Audits) relating to any Tax Return described in Section 2.01. 
 2.05. Manner of Tax Return Preparation. 
 (a) Unless otherwise required by a Taxing Authority, the Parties
hereby agree to prepare and file all Tax Returns, and to take all other actions, in a manner consistent with (1) this Agreement, (2) the Spin-Off Tax Opinion, (3) any Supplemental Spin-Off Tax Opinion, (4) any Supplemental Tax
Opinion, (5) the IRS Ruling Documents, and (6) any Supplemental Ruling Documents. All Tax Returns shall be filed on a timely basis (taking into account applicable extensions) by the Party responsible for filing such returns under this
Agreement. 
 (b) Subject to the other applicable provisions of this Agreement, Duke Energy shall have the exclusive right, in
its sole discretion, with respect to any Tax Return described in Section 2.01, to determine (1) the manner in which such Tax Return shall be prepared and filed, including the elections, method of accounting, positions, conventions and
principles of taxation to be used and the manner in which any Tax Item shall be reported, (2) whether any extensions shall be requested, (3) the elections that will be made by Duke Energy, any Duke Energy Affiliate, Spectra Energy, and/or
any Spectra Energy Affiliate on such Tax Return, (4) whether any amended Tax Returns shall be filed, (5) whether any claims for refund shall be made, (6) whether any refunds shall be paid by way of refund or credited against any
liability for the related Tax, and (7) whether to retain outside firms to prepare and/or review such Tax Returns. 
 (c)
With respect to any Consolidated Return or Combined Return including or reporting a Spectra Energy Separate Tax Liability: (1) Spectra Energy shall provide Duke Energy with a pro forma draft of the portion of such Tax Return that reflects
Spectra Energy and/or any Spectra Energy Affiliate at least seventy-five (75) days prior to the due date (with applicable extensions) for the filing of such Tax Return; (2) Duke Energy shall provide to Spectra Energy a pro forma draft of
the portion of such Tax Return that reflects the Spectra Energy Separate Tax Liability and a statement showing in reasonable detail Duke Energy’s calculation of the Spectra Energy Separate Tax Liability (including copies of all worksheets and
other materials used in preparation thereof) at least forty-five (45) days prior to the due date (with applicable extensions) for the filing of such Tax Return for Spectra Energy’s review and comment; and (3) Spectra Energy shall
provide its comments to Duke Energy at least thirty (30) days prior to the due date (with applicable extensions) for the filing of such Tax Return. For the avoidance of doubt, nothing in this Section 2.05(c) shall alter the sole and
exclusive responsibility for the preparation and filing of Tax Returns under Sections 2.01 and 2.02. Any dispute regarding the reporting of any Tax Item on any Tax Return covered by this section shall be resolved pursuant to Section 9.02. If
Spectra Energy has not provided its comments on the pro forma draft of the portion of the Tax Return, or in the case of a dispute regarding the reporting of any Tax Item, such dispute has not been resolved by the due date (with applicable
extensions) for the filing of any Tax Return, Duke Energy shall file such Tax Return reporting all Tax Items in the manner as originally set forth on the pro forma draft of the portion of the Tax 

  

 10 

 
Return provided to Spectra Energy; provided, however, that Duke Energy agrees that it will thereafter file an amended Tax Return, if necessary,
reporting any disputed Tax Item in the manner determined under Section 9.02, and any other Tax Item as agreed upon by Duke Energy and Spectra Energy. 
 2.06. Tax Services. The Transition Services Agreement shall control the provision of any other Tax related services by Duke Energy for Spectra Energy and/or any Tax related services by Spectra Energy for Duke
Energy. 
 Section 3. Liability for Taxes. 
 3.01. Spectra Energy’s Liability for Taxes. Spectra Energy and each Spectra Energy Affiliate (other than the Excluded Spectra Energy Affiliates) shall be jointly and severally liable for the following Taxes, and shall be
entitled to receive and retain all refunds and credits of Taxes previously incurred by Spectra Energy, any Spectra Energy Affiliate, or the Gas Business with respect to such Taxes: 
 (a) all Taxes with respect to Tax Returns described in Section 2.01(a) to the extent that such Taxes are related to (i) the
Spectra Energy Separate Tax Liability, or (ii) the Gas Business, for any taxable period; 
 (b) all Taxes with respect to
Tax Returns described in Section 2.01(d); 
 (c) all Taxes with respect to Tax Returns described in Section 2.02;

 (d) all Taxes imposed by any Taxing Authority with respect to Spectra Energy, any Spectra Energy Affiliate, or the Gas
Business (other than in connection with the required filing of a Tax Return described in Sections 2.01(a), 2.01(d) or 2.02) for any taxable period; 
 (e) notwithstanding any other provision in Sections 3.01 or 3.02, Spectra Energy and any Spectra Energy Affiliates (other than the Excluded Spectra Energy Affiliates) shall be jointly and severally liable for the
portion of any Exchangeco Tax as determined based on the formula for the allocation of Unallocated Liabilities described in Article VI of the Separation Agreement; 
 (f) notwithstanding any other provision in Sections 3.01 or 3.02, Spectra Energy and any Spectra Energy Affiliates (other than the
Excluded Spectra Energy Affiliates) shall be jointly and severally liable for any Taxes resulting from any Deferred Intercompany Item, whenever created, that is caused to be recognized after the Distribution, by any action or omission of Spectra
Energy or any Spectra Energy Affiliate (Duke Energy shall have no liability for any such Taxes); and 
 (g) notwithstanding
any other provision in this Agreement, all Taxes with respect to the matters or items described on Schedule 3.01(g) attached hereto. 
  

 11 

 3.02. Duke Energy’s Liability for Taxes. Duke Energy shall be liable for the following Taxes,
and shall be entitled to receive and retain all refunds and credits of Taxes previously incurred by Duke Energy, any Duke Energy Affiliate, or the Power Business with respect to such Taxes: 
 (a) all Taxes with respect to Tax Returns described in Section 2.01(a) to the extent that such Taxes are related to (i) the Duke
Energy Separate Tax Liability, or (ii) the Power Business, for any taxable period; 
 (b) all Taxes with respect to Tax
Returns described in Section 2.01(b) or Section 2.01(c); 
 (c) all Taxes imposed by any Taxing Authority with
respect to Duke Energy, any Duke Energy Affiliate, or the Power Business (other than in connection with the required filing of a Tax Return described in Sections 2.01(a), 2.01(b) or 2.01(c)) for any taxable period; 
 (d) notwithstanding any other provision in Sections 3.01 or 3.02, Duke Energy shall be liable for the portion of any Exchangeco Tax as
determined based on the formula for the allocation of Unallocated Liabilities described in Article VI of the Separation Agreement; 
 (e) notwithstanding any other provision in Sections 3.01 or 3.02, Duke Energy shall be liable for any Taxes resulting from any Deferred Intercompany Item, whenever created, that is caused to be recognized after the Distribution, by any
action or omission of Duke Energy or any Duke Energy Affiliate (Spectra Energy shall have no liability for any such Taxes); and 
 (f) notwithstanding any other provision in this Agreement, all Taxes with respect to the matters or items described on Schedule 3.02(f) attached hereto. 
 3.03. Joint Liability for Certain Unallocated Taxes. 
 (a) In the event that any Taxes
with respect to Tax Returns described in Section 2.01(a) are not otherwise allocated by Sections 3.01 or 3.02, then the liability for such Taxes shall be allocated in the manner consistent with the allocation of Unallocated Liabilities
described in Article VI of the Separation Agreement. 
 (b) Except for Distribution Taxes, any Tax resulting from any
transactions undertaken to effectuate the Separation shall be allocated in the manner consistent with the allocation of Unallocated Liabilities described in Article VI of the Separation Agreement, and for the avoidance of doubt, such Taxes shall not
be allocated under the provisions in Section 3.01 or 3.02. 
 3.04. Refunds and Credits. Nothing in this Agreement shall be
construed as to require compensation, by payment, credit, offset or otherwise, by Duke Energy (or any Duke Energy Affiliate) to Spectra Energy (or any Spectra Energy Affiliate) for any loss, deduction, credit or other Tax attribute arising in
connection with, or related to, Spectra Energy or any Spectra Energy Affiliate, that is shown on, or otherwise reflected with respect to, any Tax Return 

  

 12 

 
described in Section 2.01. Nothing in this Agreement shall be construed as to require compensation, by payment, credit, offset or otherwise, by Spectra
Energy (or any Spectra Energy Affiliate) to Duke Energy (or any Duke Energy Affiliate) for any loss, deduction, credit or other Tax attribute arising in connection with, or related to, Duke Energy or any Duke Energy Affiliate, that is shown on, or
otherwise reflected with respect to, any Tax Return described in Section 2.02. 
 3.05. Payment of Tax Liability. If one Party is
liable or responsible for Taxes, under Sections 3.01 through 3.04, with respect to Tax Returns for which another party is responsible for preparing and/or filing, or with respect to Taxes that are paid by another Party, then the liable or
responsible Party shall pay the Taxes (or a reimbursement of such Taxes) to the other Party pursuant to Section 7.05; provided, however, Spectra Energy’s liability to pay Duke Energy under Section 7.05 shall be reduced
by the amount Duke Energy accrued for Income Taxes of Spectra Energy for the 2006 calendar year; provided further, however, that if the amount that Spectra Energy owes Duke Energy is negative as a result of such reduction, Duke Energy shall pay the
absolute value of such negative amount to Spectra Energy. 
 3.06. Computation. Duke Energy shall provide Spectra Energy with a
written calculation in reasonable detail (including copies of all work sheets and other materials used in preparation thereof) setting forth the amount of any Spectra Energy Separate Tax Liability or estimated Spectra Energy Separate Tax Liability
(for purposes of Section 7.01) and any Taxes for which Spectra Energy is liable under Section 3.01. Spectra Energy shall have the right to review and comment on such calculation. Any dispute with respect to such calculation shall be
resolved pursuant to Section 9.02; provided, however, that, notwithstanding any dispute with respect to any such calculation, in no event shall any payment attributable to the amount of any Spectra Energy Separate Tax Liability or
estimated Spectra Energy Separate Tax Liability be paid later than the date provided in Section 7. 
 Section 4. Distribution Taxes and
Deconsolidation. 
 4.01. Distribution Taxes. 
 (a) Duke Energy’s Liability for Distribution Taxes. Notwithstanding Sections 3.01 through 3.04, Duke Energy shall be liable
for any Distribution Taxes, to the extent that such Distribution Taxes are attributable to, caused by, or result from, one or more of the following (collectively, “Duke Energy Tax Acts”): 
 (i) any action or omission by Duke Energy or any Duke Energy Affiliate, at any time, that is inconsistent with any material, information,
covenant or representation in an Officer’s Certificate, Spin-Off Tax Opinion, Supplemental Spin-Off Tax Opinion, Supplemental Tax Opinion, IRS Ruling Documents or Supplemental Ruling Documents (for the avoidance of doubt, disclosure by Duke
Energy (or any Duke Energy Affiliate) to Spectra Energy (or any Spectra Energy Affiliate) of any action or fact that is inconsistent with any material, information, covenant or representation submitted to Spin-Off Tax Counsel, Tax Counsel, the IRS,
or other Taxing Authority, as applicable, in connection with an Officer’s Certificate, Spin-Off Tax Opinion, Supplemental Spin-Off Tax Opinion, Supplemental Tax Opinion, IRS Ruling Documents or Supplemental Ruling Documents, shall not relieve
Duke Energy (or any Duke Energy Affiliate) of liability under this Agreement); 
  

 13 

 (ii) any action or omission by Duke Energy or any Duke Energy Affiliate, after the
Distribution (including any act or omission that is in furtherance of, connected to, or part of a plan or series of related transactions (within the meaning of section 355(e) of the Code) occurring on or prior to the Distribution), including a
cessation, transfer to affiliates, or disposition of the active trades or businesses, stock buyback or payment of an extraordinary dividend; 
 (iii) any acquisition of any stock or assets of Duke Energy or any Duke Energy Affiliate, by one or more other Persons (other than Spectra Energy or a Spectra Energy Affiliate) prior to or following the Distribution;

 (iv) any issuance of stock by Duke Energy or any Duke Energy Affiliate, after the Distribution, including any issuance
pursuant to the exercise of employee stock options or other employment related arrangements, or the exercise of warrants; or 
 (v) any change in ownership of stock in Duke Energy or any Duke Energy Affiliate after the Distribution. 
 (b)
Spectra Energy’s Liability for Distribution Taxes. Notwithstanding Sections 3.01 through 3.04, Spectra Energy, and each Spectra Energy Affiliate (other than the Excluded Spectra Energy Affiliates), shall be jointly and severally liable
for any Distribution Taxes, to the extent that such Distribution Taxes are attributable to, caused by, or result from, one or more of the following (collectively, “Spectra Energy Tax Acts”): 
 (i) any action or omission by Spectra Energy or any Spectra Energy Affiliate, at any time, that is inconsistent with any material,
information, covenant or representation in an Officer’s Certificate, Spin-Off Tax Opinion, Supplemental Spin-Off Tax Opinion, Supplemental Tax Opinion, IRS Ruling Documents or Supplemental Ruling Documents, (for the avoidance of doubt,
disclosure by Spectra Energy (or any Spectra Energy Affiliate) to Duke Energy (or any Duke Energy Affiliate) of any action or fact that is inconsistent with any material, information, covenant or representation submitted to Spin-Off Tax Counsel, Tax
Counsel, the IRS, or other Taxing Authority, as applicable, in connection with an Officer’s Certificate, Spin-Off Tax Opinion, Supplemental Spin-Off Tax Opinion, Supplemental Tax Opinion, IRS Ruling Documents, Supplemental Ruling Documents,
shall not relieve Spectra Energy (or any Spectra Energy Affiliate) of liability under this Agreement); 
 (ii) any action or
omission by Spectra Energy or any Spectra Energy Affiliate, after the Distribution (including any act or omission that is in furtherance of, connected to, or part of a plan or series of related transactions (within the meaning of section 355(e) of
the Code) occurring on or prior to the Distribution), including a cessation, transfer to affiliates, or disposition of the active trades or businesses, stock buyback or payment of an extraordinary dividend; 
  

 14 

 (iii) any acquisition of any stock or assets of Spectra Energy or any Spectra Energy
Affiliate, by one or more other Persons (other than Duke Energy or any Duke Energy Affiliate) prior to or following the Distribution; 
 (iv) any issuance of stock by Spectra Energy or any Spectra Energy Affiliate, after the Distribution, including any issuance pursuant to the exercise of employee stock options or other employment related arrangements,
or the exercise of warrants; or 
 (v) any change in ownership of stock in Spectra Energy or any Spectra Energy Affiliate
after the Distribution. 
 (c) Joint Liability for Remaining Distribution Taxes. In the event that Distribution Taxes
are not otherwise allocated by Sections 4.01(a) or (b), then the liability for such Distribution Taxes shall be allocated in the manner consistent with the allocation of Unallocated Liabilities described in Article VI of the Separation Agreement. In
the event that one or more Duke Energy Tax Acts occur simultaneously with one or more Spectra Energy Tax Acts and these result in Distribution Taxes, then the allocation of the liability for such Distribution Taxes shall be allocated in the manner
consistent with the allocation of Unallocated Liabilities described in Article VI of the Separation Agreement, and, for the avoidance of doubt, Sections 4.01(a) or (b) shall not control the allocation of such Distribution Taxes. 
 (d) Representation. Each of Duke Energy and Spectra Energy represents that, as of the date of this Agreement, neither it nor its
Affiliates know of any fact that may cause Internal Contribution 1, Internal Distribution 1, Internal Contribution 2, Internal Distribution 2, Internal Contribution 3, Internal Distribution 3, the Contribution or the Distribution to fail to qualify
as transactions in which no income, gain, or loss is recognized pursuant to section 355 of the Code. 
 (e) Representative
Examples. For the avoidance of doubt, Appendix A to this Agreement sets forth examples illustrating the intended application of this Section 4.01. 
 4.02. Carrybacks. 
 (a) In General. Duke Energy agrees to pay to Spectra Energy
the United States federal Income Tax Benefit from the use in any Pre-Distribution Period (the “Carryback Period”) of a carryback of any Tax Asset of the Spectra Energy Group from a Post-Distribution Period (other than a carryback of
any Tax Asset attributable to Distribution Taxes for which the liability is borne by Duke Energy or any Duke Energy Affiliate). If subsequent to the payment by Duke Energy to Spectra Energy of the United States federal Income Tax Benefit of a
carryback of a Tax Asset of the Spectra Energy Group, there shall be a Final Determination which results in a (1) change to the amount of the Tax Asset so carried back or (2) change to the amount of such United States federal Income Tax
Benefit, Spectra Energy shall repay to Duke Energy, or Duke Energy shall repay to Spectra Energy, as the case may be, any amount which would not have been payable to such other Party pursuant to this Section 4.02(a) had the amount of the Tax
Benefit been determined in light of these events. Nothing in this Section 4.02(a) shall require Duke Energy to file an amended Tax Return or claim for refund of United States federal Income Taxes; provided, however, that Duke
Energy shall use its reasonable efforts to use any carryback of a Tax Asset of the Spectra Energy Group that is carried back under this Section 4.02(a). 
  

 15 

 (b) Net Operating Losses. Notwithstanding any other provision of this Agreement,
Spectra Energy hereby expressly agrees to elect (under section 172(b)(3) of the Code and, to the extent feasible, any similar provision of any state, local or foreign Tax law) to relinquish any right to carryback net operating losses to any
Pre-Distribution Periods of Duke Energy (in which event no payment shall be due from Duke Energy to Spectra Energy in respect of such net operating losses). 
 4.03. Allocation of Tax Items. All Tax computations for (1) any Pre-Distribution Periods ending on the Distribution Date and (2) the immediately following taxable period of Spectra Energy or any
Spectra Energy Affiliate, shall be made pursuant to the principles of section 1.1502-76(b) of the Treasury Regulations or of a corresponding provision under the laws of other jurisdictions, as agreed upon by Duke Energy and Spectra Energy.

 4.04. Continuing Covenants. 
 (a) In General. Each of Duke Energy and Spectra Energy agrees (1) not to take any action (or cause its Affiliates to take any action) reasonably expected to result in an increased Tax liability to the
other, a reduction in a Tax Asset of the other or an increased liability to the other under this Agreement, and (2) to take any action (and cause its Affiliates to take any action) reasonably requested by the other that would reasonably be
expected to result in a Tax Benefit or avoid a Tax Detriment to the other, provided, in either such case, that the taking or refraining to take such action does not result in any additional cost not fully compensated for by the other Party or any
other adverse effect to such Party. The Parties hereby acknowledge that the preceding sentence is not intended to limit, and therefore shall not apply to, the rights of the Parties with respect to matters otherwise covered by this Agreement.

 (b) Spectra Energy Restrictions. Spectra Energy agrees that it will not knowingly take or fail to take, or permit
any Spectra Energy Affiliate to knowingly take or fail to take, any action where such action or failure to act would be inconsistent with any material, information, covenant or representation that relates to facts or matters related to Spectra
Energy (or any Spectra Energy Affiliate) or within the control of Spectra Energy and is contained in an Officer’s Certificate, Spin-Off Tax Opinion, Supplemental Tax Opinion, Supplemental Spin-Off Tax Opinion, IRS Ruling Documents or
Supplemental Ruling Documents, (except where such material, information, covenant or representation was not previously disclosed to Spectra Energy) other than as permitted by this Section 4.04. For this purpose an action is considered
inconsistent with a representation if the representation states that there is no plan or intention to take such action. Spectra Energy agrees that it will not take (and it will cause the Spectra Energy Affiliates to refrain from taking) any position
on a Tax Return that is inconsistent with the treatment of Internal Contribution 1, Internal Distribution 1, Internal Contribution 2, Internal Distribution 2, Internal Contribution 3, Internal Distribution 3, the Contribution or the Distribution as
transactions in which no income, gain, or loss is recognized pursuant to section 355 of the Code. 
  

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 (c) Duke Energy Restrictions. Duke Energy agrees that it will not knowingly take
or fail to take, or permit any Duke Energy Affiliate to knowingly take or fail to take, any action where such action or failure to act would be inconsistent with any material, information, covenant or representation that relates to facts or matters
related to Duke Energy (or any Duke Energy Affiliate) or within the control of Duke Energy and is contained in a Spin-Off Tax Opinion, Supplemental Tax Opinion, Supplemental Spin-Off Tax Opinion, IRS Ruling Documents or Supplemental Ruling
Documents, other than as permitted by this Section 4.04. For this purpose an action is considered inconsistent with a representation if the representation states that there is no plan or intention to take such action. Duke Energy agrees that it
will not take (and it will cause the Duke Energy Affiliates to refrain from taking) any position on a Tax Return that is inconsistent with the treatment of Internal Contribution 1, Internal Distribution 1, Internal Contribution 2, Internal
Distribution 2, Internal Contribution 3, Internal Distribution 3, the Contribution or the Distribution as transactions in which no income, gain, or loss is recognized pursuant to section 355 of the Code. 
 (d) Certain Spectra Energy Actions Following the Distribution. Spectra Energy agrees that, during the two (2) year period
following the Distribution, without first obtaining, at Spectra Energy’s own expense, either a supplemental opinion from Tax Counsel that such action will not result in Distribution Taxes (a “Supplemental Tax Opinion”) or a
Supplemental Ruling that such action will not result in Distribution Taxes, unless in any such case Duke Energy and Spectra Energy agree otherwise, in writing, Spectra Energy shall not (1) sell all or substantially all of the assets of the U.S.
Gas Transmission Business, (2) merge any entity that is part of the U.S. Gas Transmission Business with another entity, without regard to which party is the surviving entity, (3) transfer any assets of the U.S. Gas Transmission Business in
a transaction described in section 351 (other than a transfer to a corporation which files a United States federal consolidated Income Tax Return with Spectra Energy and which is wholly-owned, directly or indirectly, by Spectra Energy), section 721
or subparagraph (C) or (D) of section 368(a)(1) of the Code, (4) issue stock of Spectra Energy or any Spectra Energy Affiliate (or any instrument that is convertible or exchangeable into any such stock) in an acquisition or public or
private offering (excluding any issuance pursuant to the exercise of employee stock options or other employment related arrangements having customary terms and conditions and that satisfy the requirements of Treasury Regulations section
1.355-7(d)(8), or any successor provision thereto), or (5) facilitate or otherwise participate in any acquisition of stock in Spectra Energy that would result in any shareholder owning five percent (5%) or more of the outstanding stock of
Spectra Energy. Spectra Energy (or any Spectra Energy Affiliate) shall only undertake any of such actions after Duke Energy’s receipt of such Supplemental Tax Opinion or Supplemental Ruling and pursuant to the terms and conditions of any such
Supplemental Tax Opinion or Supplemental Ruling or as otherwise consented to in writing in advance by Duke Energy. The Parties hereby agree that they will act in good faith to take all reasonable steps necessary to amend this Section 4.04(d),
from time to time, by mutual agreement, to (i) add certain actions to the list contained herein, or (ii) remove certain actions from the list contained herein, in either case, in order to reflect any relevant change in law, regulation or
administrative interpretation occurring after the date of this Agreement. 
  

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 (e) Spectra Energy and Duke Energy Cooperation. Spectra Energy and Duke Energy
agree that, at the request of the other Party, the Parties shall cooperate fully to seek to obtain, as expeditiously as possible, the Spin-Off Tax Opinion, any Supplemental Spin-Off Tax Opinion, any Supplemental Tax Opinion, the IRS Ruling, and/or
any Supplemental Ruling. Such cooperation shall include the execution of any documents that may be necessary or reasonably helpful in connection with obtaining the Spin-Off Tax Opinion, Supplemental Spin-Off Tax Opinion, Supplemental Tax Opinion,
IRS Ruling, and/or Supplemental Ruling (including any power of attorney, Officer’s Certificate, IRS Ruling Documents, Supplemental Rulings Documents, and/or reasonably requested written representations confirming that (i) Duke Energy or
Spectra Energy, as the case may be, has read the Officer’s Certificate, IRS Ruling Documents, and/or Supplemental Ruling Documents, and (ii) all information and representations, if any, relating to Duke Energy (or any Duke Energy
Affiliate) or Spectra Energy (or any Spectra Energy Affiliate), as the case may be, contained in the Officer’s Certificate, IRS Ruling Documents, and/or Supplemental Ruling Documents are true, correct and complete in all material respects).

 4.05. Allocation of Tax Assets. 
 (a) In General. In connection with the Spin-Off, Duke Energy and Spectra Energy shall cooperate in determining the allocation of any Tax Assets among Duke Energy, each Duke Energy Affiliate, Spectra Energy, and
each Spectra Energy Affiliate. The Parties hereby agree that in the absence of controlling legal authority or unless otherwise provided under this Agreement, Tax Assets shall be allocated to the legal entity that created such Tax Assets. 

(b) Earnings and Profits. Duke Energy will advise Spectra Energy in writing of the decrease in Duke Energy earnings and profits
attributable to the Spin-Off under section 312(h) of the Code on or before the first anniversary of the Distribution Date; provided, however, that Duke Energy shall provide Spectra Energy with estimates of such amounts (determined in
accordance with past practice) prior to such anniversary as reasonably requested by Spectra Energy. Any reasonable third party cost incurred after the Spin-Off in connection with determining the earnings and profits attributable to the Spin-Off
shall be allocated among Duke Energy and Spectra Energy consistent with the allocation of Unallocated Liabilities described in Article VI of the Separation Agreement. 
 4.06. DEFS Distribution. Notwithstanding anything to the contrary in Article III, Spectra Energy agrees to pay Duke Energy no later than March 9, 2007 an amount equal to the 2006 tax distribution paid or
distributed by Duke Energy Field Services LLC to Duke Energy Enterprises Corporation (which is expected to be paid or distributed in January 2007). Spectra Energy shall notify Duke Energy of the amount of such 2006 tax distribution within ten
(10) days of Duke Energy Enterprises Corporation’s receipt of such tax distribution from Duke Energy Field Services. 
 4.07.
Alternative Minimum Tax Audits. If the proposed settlement associated with the Audit by the IRS of certain Duke Energy entities (including certain members of the Spectra Energy Group) with respect primarily to alternative minimum tax matters
for the periods 1997-1998 is not finally agreed to by Duke Energy and the IRS prior to the Effective Time, then Duke Energy will cause the Spectra Energy Target Cash Amount set forth in the Separation Agreement to be increased by $44 million. If
such $44 million is required to be delivered to Spectra Energy 

  

 18 

 
pursuant to this Section 4.07, promptly following effectiveness of the settlement and receipt by Duke Energy of any amounts payable by the Service to
Duke Energy, Spectra Energy shall repay such $44 million to Duke Energy with interest at the rate described in Section 7.05(e). 
 Section 5.
Employee Wages. 
 At Duke Energy’s request, Spectra Energy shall assume the Form W-2 and Form W-3 reporting obligations (including
the filing of all forms necessary to comply with magnetic media reporting requirements) of Duke Energy with respect to any employee of the Gas Business that Spectra Energy or any Spectra Energy Affiliate employs during the calendar year which
includes the Distribution Date consistent with the procedures set forth in section 5 of Rev. Proc. 2004-53, 2004-34 I.R.B. 320. 
 Section 6.
Indemnification. 
 6.01. In General. Duke Energy shall indemnify Spectra Energy, each Spectra Energy Affiliate, and their
respective directors, officers and employees, and hold them harmless from and against any and all Taxes for which Duke Energy or any Duke Energy Affiliate is liable under this Agreement and any loss, cost, damage or expense, including reasonable
attorneys’ fees and costs, that is attributable to, or results from, the failure of Duke Energy, any Duke Energy Affiliate or any director, officer or employee to make any payment required to be made under this Agreement. Spectra Energy and
each Spectra Energy Affiliate (other than the Excluded Spectra Energy Affiliates) shall jointly and severally indemnify Duke Energy, each Duke Energy Affiliate, and their respective directors, officers and employees, and hold them harmless from and
against any and all Taxes for which Spectra Energy or any Spectra Energy Affiliate is liable under this Agreement and any loss, cost, damage or expense, including reasonable attorneys’ fees and costs, that is attributable to, or results from,
the failure of Spectra Energy, any Spectra Energy Affiliate or any director, officer or employee to make any payment required to be made under this Agreement. 
 6.02. Inaccurate or Incomplete Information. Duke Energy shall indemnify Spectra Energy, each Spectra Energy Affiliate, and their respective directors, officers and employees, and hold them harmless from and
against any cost, fine, penalty, or other expenses of any kind attributable to the failure of Duke Energy or any Duke Energy Affiliate to supply Spectra Energy or any Spectra Energy Affiliate with accurate and complete information in connection with
the preparation of any Tax Return. Spectra Energy and each Spectra Energy Affiliate (other than the Excluded Spectra Energy Affiliates) shall jointly and severally indemnify Duke Energy, each Duke Energy Affiliate, and their respective directors,
officers and employees, and hold them harmless from and against any cost, fine, penalty, or other expenses of any kind attributable to the failure of Spectra Energy or any Spectra Energy Affiliate to supply Duke Energy or any Duke Energy Affiliate
with accurate and complete information in connection with the preparation of any Tax Return. 
 6.03. No Indemnification for Tax
Items. Nothing in this Agreement shall be construed as a guarantee of the existence or amount of any loss, credit, carryforward, basis or other Tax Item, whether past, present or future, of Duke Energy, any Duke Energy Affiliate, Spectra Energy
or any Spectra Energy Affiliate. 
  

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 Section 7. Payments. 
 7.01. Estimated Tax Payments. Not later than five (5) Business Days prior to each Estimated Tax Installment Date with respect to a taxable period for which a Consolidated Return or a Combined Return will
be filed, Spectra Energy shall pay to Duke Energy on behalf of the Spectra Energy Group an amount equal to the amount of any estimated Spectra Energy Separate Tax Liability for any Post-Distribution Period that Spectra Energy otherwise would have
been required to pay to a Taxing Authority on such Estimated Tax Installment Date. 
 7.02. True-Up Payments. Not later than five
(5) Business Days after completion of a Tax Return, Spectra Energy shall pay to Duke Energy, or Duke Energy shall pay to Spectra Energy, as appropriate, an amount equal to the difference, if any, between the Spectra Energy Separate Tax
Liability and the aggregate amount paid by Spectra Energy with respect to such period under Section 7.01. 
 7.03. Redetermination
Amounts. In the event of a redetermination of any Tax Item reflected on any Consolidated Return or Combined Return (other than Tax Items relating to Distribution Taxes), as a result of a refund or credit of Taxes paid, a Final Determination or
any settlement or compromise with any Taxing Authority which in any such case would affect the Spectra Energy Separate Tax Liability, Duke Energy shall prepare a revised pro forma Tax Return in accordance with Section 2.01(a) for the relevant
taxable period reflecting the redetermination of such Tax Item as a result of such refund, Final Determination, settlement or compromise. Spectra Energy shall pay to Duke Energy, or Duke Energy shall pay to Spectra Energy, as appropriate, an amount
equal to the difference, if any, between the Spectra Energy Separate Tax Liability reflected on such revised pro forma Tax Return and the Spectra Energy Separate Tax Liability for such period as originally computed pursuant to this Agreement.

 7.04. Payments of Refunds and Credits. If one Party receives a refund or credit of any Tax to which the other Party is entitled
pursuant to Section 3.04, the Party receiving such refund or credit shall pay to the other Party the amount of such refund or credit pursuant to Section 7.05. 
 7.05. Payments Under This Agreement. In the event that one Party (the “Owing Party”) is required to make a payment to another Party (the “Owed Party”) pursuant to this
Agreement, then such payments shall be made according to this Section 7.05. 
 (a) In General. All payments shall
be made to the Owed Party or to the appropriate Taxing Authority as specified by the Owed Party within the time prescribed for payment in this Agreement, or if no period is prescribed, within ten (10) days after delivery of written notice of
payment owing together with a computation of the amounts due. 
  

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 (b) Treatment of Payments. Unless otherwise required by any Final Determination,
the Parties agree that any payments made by one Party to another Party pursuant to this Agreement (other than (i) payments for tax services pursuant to the Transition Services Agreement, (ii) payments of After Tax Amounts pursuant to
Section 7.05(d), and (iii) payments of interest pursuant to Section 7.05(e)) shall be treated for all Tax purposes as nontaxable payments (dividend distributions or capital contributions, as the case may be) made immediately prior to
the Distribution and, accordingly, as not includible in the taxable income of the recipient or as deductible by the payor. 
 (c) Prompt Performance. All actions required to be taken (including payments) by any Party under this Agreement shall be performed within the time prescribed for performance in this Agreement, or if no period is prescribed, such
actions shall be performed promptly. 
 (d) After Tax Amounts. If pursuant to a Final Determination it is determined
that the receipt or accrual of any payment made under this Agreement (other than (i) payments for Tax Services pursuant to Section 2.06, and (ii) payments of interest pursuant to Section 7.05(e)) is subject to any Tax, the Party
making such payment shall be liable for (a) the After Tax Amount with respect to such payment and (b) interest at the rate described in Section 7.05(e) on the amount of such Tax from the date such Tax accrues with respect to the
receipt of such payment through the date of payment of such After Tax Amount. A Party making a demand for a payment pursuant to this Agreement and for a payment of an After Tax Amount with respect to such payment shall separately specify and compute
such After Tax Amount. However, a Party may choose not to specify an After Tax Amount in a demand for payment pursuant to this Agreement without thereby being deemed to have waived its right subsequently to demand an After Tax Amount with respect to
such payment. 
 (e) Interest. Payments pursuant to this Agreement that are not made within the period prescribed in
this Agreement (the “Payment Period”) shall bear interest for the period from and including the date immediately following the last date of the Payment Period through and including the date of payment at a per annum rate equal to
the prime rate of interest (the base rate on corporate loans) as published under “Money Rates” in The Wall Street Journal on the last day of such Payment Period, plus two percent (2%). Such interest will be payable at the same time
as the payment to which it relates and shall be calculated on the basis of a year of three hundred sixty-five (365) days and the actual number of days for which due. 
 (f) Procedures. Any claim for indemnification under this Section 7 shall be governed by, and be subject to, the provisions of
Article VII of the Separation Agreement, which provisions are hereby incorporated by reference into this Agreement and any references to “Agreement” in such Article VII as incorporated herein shall be deemed to be references to this
Agreement. 
 Section 8. Tax Proceedings. 
 8.01. In General. Except as otherwise provided in this Agreement, the Party responsible for preparing and filing a Tax Return pursuant to Section 2 (the “Filing Party”) shall have the exclusive right, in its
sole discretion, to control, contest, and represent the interests of Duke 

  

 21 

 
Energy, any Duke Energy Affiliate, Spectra Energy, and/or any Spectra Energy Affiliate in any Audit relating to such Tax Return and to resolve, settle or
agree to any deficiency, claim or adjustment proposed, asserted or assessed in connection with or as a result of any such Audit. The Filing Party’s rights shall extend to any matter pertaining to the management and control of an Audit,
including execution of waivers, choice of forum, scheduling of conferences and the resolution of any Tax Item. Any costs incurred in handling, settling, or contesting an Audit shall be borne by the Filing Party. 
 8.02. Participation of non-Filing Party. Except as provided in Section 8.04, the non-Filing Party shall, at its own expense, have control
over decisions to resolve, settle or otherwise agree to any deficiency, claim or adjustment with respect to any Sole Responsibility Item. Except as provided in Section 8.04, the Filing Party, at its own expense, and the non-Filing Party, at its
own expense, shall have joint control over decisions to resolve, settle or otherwise agree to any deficiency, claim or adjustment with respect to any Joint Responsibility Item. Except as provided in Section 8.04, the Filing Party shall not
settle any Audit it controls concerning a Tax Item on a basis that would reasonably be expected to adversely affect the non-Filing Party by at least one million dollars ($1,000,000) without obtaining such non-Filing Party’s consent, which
consent shall not be unreasonably withheld, conditioned or delayed if failure to consent would adversely affect the Filing Party. 
 8.03.
Notice. Within ten (10) days after a Party becomes aware of the existence of a Tax issue that may give rise to an indemnification obligation under this Agreement, such Party shall give notice to the other Party of such issue (such notice
shall contain factual information, to the extent known, describing any asserted tax liability in reasonable detail), and shall forward to the other Party copies of all notices and material communications with any Taxing Authority relating to such
issue. Notwithstanding any provision in Section 9.06 to the contrary, if a Party to this Agreement fails to provide the other Party notice as required by this Section 8.03, and the failure results in a detriment to the other Party then any
amount which the other Party is otherwise required to pay pursuant to this Agreement shall be reduced by the amount of such detriment. 
 8.04. Control of Distribution Tax Proceedings. Spectra Energy may assume sole control of any Audits relating to Distribution Taxes if it acknowledges in writing that it has sole liability for any Distribution Taxes under
Section 4.01(b) that might arise in such Audit and can demonstrate to the reasonable satisfaction of Duke Energy that it can satisfy its liability for any such Distribution Taxes. 
 Section 9. Miscellaneous. 
 9.01. Cooperation and Exchange of Information. 
 (a) Cooperation. Spectra Energy and Duke Energy shall each cooperate fully (and each shall cause its respective Spectra Energy
Affiliates and Duke Energy Affiliates to cooperate fully) with all reasonable requests from another Party for information, data files and materials not otherwise available to the requesting Party in connection with the preparation and filing of Tax
Returns, claims for refund, and Audits concerning issues or other matters covered 

  

 22 

 
by this Agreement or in connection with the determination of a liability for Taxes or a right to a refund of Taxes; provided, however, that
nothing in this Section 9.01 shall be construed to require Duke Energy to provide Spectra Energy or any Spectra Energy Affiliate with any financial accounting or tax-related software. Such cooperation shall include: 
 (i) the retention until the expiration of the applicable statute of limitations, and the provision upon request, of copies of all Tax
Returns, books, records (including information regarding ownership and Tax basis of property), documentation and other information relating to the Tax Returns, including accompanying schedules, related work papers, and documents relating to rulings
or other determinations by Taxing Authorities (collectively, “Tax Material”), provided, however, that no such retention obligation shall exist to the extent such Tax Material has previously been provided from one Party
to the other Party; 
 (ii) the execution of any document that may be necessary or reasonably helpful in connection with any
Tax Proceeding, or the filing of a Tax Return or refund claim by a member of the Duke Energy Group or the Spectra Energy Group, including certification, to the best of a Party’s knowledge, of the accuracy and completeness of the information it
has supplied; and 
 (iii) the use of the Party’s reasonable best efforts to obtain any documentation that may be
necessary or reasonably helpful in connection with any of the foregoing. Each Party shall make its employees and facilities available on a reasonable and mutually convenient basis in connection with the foregoing matters. 
 (b) Notices, Withholding, Reporting. 
 (i) Spectra Energy shall notify Duke Energy of any event after the Distribution Date giving rise to income to any current and former employees of Duke Energy (or any Duke Energy Affiliate) in connection with any
Spectra Energy Stock Options, Spectra Energy restricted stock, Spectra Energy performance shares or Spectra Energy phantom stock units by 12:00 P.M. of the first business day after such event, and, subject to any obligations under the Employee
Matters Agreement, Duke Energy shall remit applicable Taxes and satisfy applicable Tax reporting obligations in connection therewith if required by law.
 (ii) Duke Energy shall notify Spectra Energy of any event after the Distribution Date giving rise to income to any current and former employees of Spectra Energy (or any Spectra Energy Affiliate) in connection with
any Duke Energy Stock Options, Duke Energy restricted stock, Duke Energy performance shares or Duke Energy phantom stock units by 12:00 P.M. of the first business day after such event, and, subject to any obligations under the Employee Matters
Agreement, Spectra Energy shall remit applicable Taxes and satisfy applicable Tax reporting obligations in connection therewith if required by law.
 (c) Retention of Records. Duke Energy, or any Duke Energy Affiliate, that is in possession of documentation relating to the Gas Business, including books, records, Tax Returns and all supporting schedules and
information relating thereto that has not been previously provided to Spectra Energy by Duke Energy (the “Spectra Energy Business Records”), and 

  

 23 

 
Spectra Energy, or any Spectra Energy Affiliate, that is in possession of documentation relating to the Power Business, including books, records, Tax Returns
and all supporting schedules and information relating thereto that has not been previously provided to Duke Energy by Spectra Energy (the “Duke Energy Business Records”) shall each retain such Spectra Energy Business Records or Duke
Energy Business Records for a period of seven (7) years following the Distribution Date. Thereafter, (i) if Duke Energy wishes to dispose of Spectra Energy Business Records in its possession, shall provide written notice to Spectra Energy
describing the documentation proposed to be destroyed or disposed of sixty (60) Business Days prior to taking such action, and Spectra Energy may arrange to take delivery of any or all of the documentation described in the notice at its expense
during the succeeding sixty (60) day period; and (ii) if Spectra Energy wishes to dispose of Duke Energy Business Records in its possession, shall provide written notice to Duke Energy describing the documentation proposed to be destroyed
or disposed of sixty (60) Business Days prior to taking such action, and Duke Energy may arrange to take delivery of any or all of the documentation described in the notice at its expense during the succeeding sixty (60) day period.

 (d) Gain Recognition Agreement. Duke Energy and Spectra Energy mutually agree to comply with all notification
requirements pursuant to Treas. Reg. § 1.367(a)-8 with respect to the gain recognition agreement entered into with respect to PanEnergy Corp’s April 1, 2003 transfer of shares of Westcoast Energy Inc. (“WEI”) to Duke Energy
Nova Scotia Holdings Company and to take all reasonable steps necessary to preserve the nonrecognition treatment of such transfer. In connection with such requirement, among other notifications, Spectra Energy agrees to notify Duke Energy within
twenty (20) days after any disposition of stock or assets prior to January 1, 2009 that could reasonably be expected to affect the gain recognition agreement or the notification requirements pursuant to Treas. Reg. § 1.367(a)-8.

 9.02. Dispute Resolution. In the event that Duke Energy and Spectra Energy disagree as to the amount or calculation of any payment
to be made under this Agreement, or the interpretation or application of any provision under this Agreement, the disagreement shall be resolved in accordance with Article IX of the Separation Agreement provided however for the avoidance of doubt
that the provisions in section 9.12 of the Separation Agreement shall not apply. Notwithstanding anything in this Agreement to the contrary, the dispute resolution provisions set forth in this Section 9.02 shall not be applicable to any
disagreement between the Parties relating to Distribution Taxes and any such dispute shall be settled in a court of law or as otherwise agreed to by the Parties. 
 9.03. Complete Agreement; Construction. This Agreement, including the Appendix, shall constitute the entire agreement between the Parties with respect to the subject matter hereof and shall supersede all
previous negotiations, commitments and writings with respect to such subject matter. This Agreement supersedes any prior tax matters agreements between Duke Energy (or any Duke Energy Affiliate) and Spectra Energy (or any Spectra Energy Affiliate)
and such prior tax matters agreements shall have no further force and effect. In the event of any conflict between the terms and conditions of the body of this Agreement and the terms and conditions of the Appendix, the terms and conditions of such
Appendix shall control. In the event of any conflict between the terms and conditions of this Agreement and the terms and conditions of the Separation Agreement or any other Ancillary Agreement, the terms and conditions of this Agreement shall
control. 
  

 24 

 9.04. Counterparts. This Agreement may be executed in more than one counterparts, all of which
shall be considered one and the same agreement, and shall become effective when one or more such counterparts have been signed by each of the Parties and delivered to the other Parties. Execution of this Agreement or any other documents pursuant to
this Agreement by facsimile or other electronic copy of a signature shall be deemed to be, and shall have the same effect as, execution by original signature. 
 9.05. Survival of Agreement. Except as otherwise contemplated by this Agreement, all covenants and agreements of the Parties contained in this Agreement shall survive the Effective Time and remain in full force
and effect in accordance with their applicable terms. 
 9.06. Notices. All notices, requests, claims, demands and other
communications under this Agreement, as between the Parties, shall be in writing and shall be given or made (and shall be deemed to have been duly given or made upon receipt unless the day of receipt is not a Business Day, in which case it shall be
deemed to have been duly given or made on the next Business Day) by delivery in person, by overnight courier service, by facsimile with receipt confirmed (followed by delivery of an original via overnight courier service) or by registered or
certified mail (postage prepaid, return receipt requested) to the respective Parties at the following addresses (or at such other address for a Party as shall be specified in a notice given in accordance with this Section 9.06): 
 To Duke Energy: 
 Duke Energy Corporation

 526 South Church Street 
 Charlotte, North Carolina 28202 
 Attn: Vice President of Corporate Tax 
 Facsimile: (704) 382-8137 
 To Spectra
Energy: 
 Spectra Energy Corp 
 5400 Westheimer Court 
 Houston, Texas 77056 
 Attn: Vice President, Tax 
 Facsimile: (713) 989-3280 
  

 25 

 9.07. Changes in Law. 
 (a) Any reference to a provision of the Code or a law of another jurisdiction shall include a reference to any applicable successor
provision or law. 
 (b) If, due to any change in applicable law or regulations or their interpretation by any court of law or
other governing body having jurisdiction subsequent to the date of this Agreement, performance of any provision of this Agreement or any transaction contemplated thereby shall become impracticable or impossible, the Parties hereto shall use their
commercially reasonable efforts to find and employ an alternative means to achieve the same or substantially the same result as that contemplated by such provision. 
 9.08. Waivers. The failure of any Party to require strict performance by any other Party of any provision in this Agreement will not waive or diminish that Party’s right to demand strict performance
thereafter of that or any other provision hereof. 
 9.09. Amendments. Subject to the terms of Section 9.12, this Agreement may
not be modified or amended except by an agreement in writing signed by each of the Parties. 
 9.10. Assignment. Except as otherwise
expressly provided for in this Agreement, this Agreement shall not be assignable, in whole or in part, by any Party without the prior written consent of the other Party, and any attempt to assign any rights or obligations arising under this
Agreement without such consent shall be null and void; provided, that a Party may assign this Agreement in connection with a merger transaction in which such Party is not the surviving entity or the sale by such Party of all or substantially all of
its Assets, and upon the effectiveness of such assignment, the assigning Party shall be released from all of its obligations under this Agreement, if the surviving entity of such merger or the transferee of such Assets shall agree in writing in form
and substance reasonably satisfactory to the other Party, to be bound by the terms of this Agreement as if named as a “Party” hereto. 
 9.11. Successors and Assigns. The provisions of this Agreement and the obligations and rights hereunder shall be binding upon, inure to the benefit of and be enforceable by (and against) the Parties and their respective successors
and permitted transferees and assigns. 
 9.12. Termination, Etc. Notwithstanding anything to the contrary herein, this Agreement
(including Section 6 (Indemnification) hereof) may be terminated and abandoned at any time prior to the Distribution Date by and in the sole discretion of Duke Energy without the approval of Spectra Energy or the stockholders of Duke Energy. In
the event of such termination, no Party shall have any liability to any other Party or any other Person. After the Distribution Date, this Agreement may not be terminated except by an agreement in writing signed by each of the Parties. 

9.13. Third Party Beneficiaries. Except as otherwise expressly provided in this Agreement, this Agreement is solely for the benefit of the
Parties and should not be deemed to confer upon third parties any remedy, claim, liability, reimbursement, cause of action or other right in excess of those existing without reference to this Agreement. 
  

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 9.14. Interpretations. Titles and headings to sections herein are inserted for the convenience of
reference only and are not intended to be a part of or to affect the meaning or interpretation of this Agreement. 
 9.15. Schedules and
Appendix. The Schedules and Appendix attached hereto are incorporated herein by reference and shall be construed with and as an integral part of this Agreement to the same extent as if the same had been set forth verbatim herein. 
 9.16. Governing Law. This Agreement shall be governed by and construed in accordance with the internal laws, and not the laws governing conflicts
of laws (other than Sections 5-1401 and 5-1402 of the New York General Obligations Law), of the State of New York. 
 9.17. Consent to
Jurisdiction. Subject to the provisions of this section 9.17, each of the Parties irrevocably submits to the exclusive jurisdiction of (a) the Supreme Court of the State of New York, New York County, and (b) the United States District
Court for the Southern District of New York (the “New York Courts”), for the purposes of any suit, action or other proceeding to compel arbitration or for provisional relief in aid of arbitration in accordance with Section 9 or
for provisional relief to prevent irreparable harm, and to the non-exclusive jurisdiction of the New York Courts for the enforcement of any award issued thereunder. Each of the Parties further agrees that service of any process, summons, notice or
document by United States registered mail to such Party’s respective address set forth above shall be effective service of process for any action, suit or proceeding in the New York Courts with respect to any matters to which it has submitted
to jurisdiction in this Section 9.17. Each of the Parties irrevocably and unconditionally waives any objection to the laying of venue of any action, suit or proceeding arising out of this Agreement or the transactions contemplated hereby in the
New York Courts, and hereby further irrevocably and unconditionally waives and agrees not to plead or claim in any such court that any such action, suit or proceeding brought in any such court has been brought in an inconvenient forum. 

9.18. Specific Performance. The Parties agree that irreparable damage would occur in the event that the provisions of this Agreement were not
performed in accordance with their specific terms. Accordingly, it is hereby agreed that the Parties shall be entitled to (i) an injunction or injunctions to enforce specifically the terms and provisions hereof in any arbitration in accordance
with Section 9.02 herein, (ii) provisional or temporary injunctive relief in accordance therewith in any New York Court, and (iii) enforcement of any such award of an arbitral tribunal or a New York Court in any court of the United
States, or any other court or tribunal sitting in any state of the United States or in any foreign country that has jurisdiction, this being in addition to any other remedy or relief to which they may be entitled. 
 9.19. Waiver of Jury Trial. SUBJECT TO SECTIONS 9.02, 9.17 AND 9.18 HEREIN, EACH OF THE PARTIES HEREBY WAIVES TO THE FULLEST EXTENT PERMITTED BY
APPLICABLE LAW ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY WITH RESPECT TO ANY COURT PROCEEDING DIRECTLY OR INDIRECTLY ARISING OUT OF AND PERMITTED UNDER OR IN CONNECTION WITH THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED BY THIS AGREEMENT. EACH OF
THE PARTIES 

  

 27 

 
HEREBY (A) CERTIFIES THAT NO REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER PARTY HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PARTY WOULD
NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER AND (B) ACKNOWLEDGES THAT IT HAS BEEN INDUCED TO ENTER INTO THIS AGREEMENT AND THE TRANSACTIONS CONTEMPLATED BY THIS AGREEMENT, AS APPLICABLE, BY, AMONG OTHER THINGS, THE
MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION 9.19. 
 9.20. Severability. In the event any one or more of the provisions
contained in this Agreement should be held invalid, illegal or unenforceable in any respect, the validity, legality and enforceability of the remaining provisions contained herein shall not in any way be affected or impaired thereby, and the Parties
shall endeavor in good-faith negotiations to replace the invalid, illegal or unenforceable provisions with valid provisions, the economic effect of which comes as close as possible to that of the invalid, illegal or unenforceable provisions.

 9.21. Force Majeure. No Party (or any person acting on its behalf) shall have any liability or responsibility for failure to
fulfill any obligation (other than a payment obligation) under this Agreement so long as and to the extent to which the fulfillment of such obligation is prevented, frustrated, hindered or delayed as a consequence of circumstances of Force Majeure.
A Party claiming the benefit of this provision shall, as soon as reasonably practicable after the occurrence of any such event: (a) notify the other Party of the nature and extent of any such Force Majeure condition and (b) use due
diligence to remove any such causes and resume performance under this Agreement as soon as reasonably practicable. 
 9.22. No
Circumvention. The Parties agree not to directly or indirectly take any actions, act in concert with any person who takes an action, or cause or allow any member Affiliate to take any actions (including the failure to take a reasonable action)
such that the resulting effect is to materially undermine the effectiveness of any of the provisions of this Agreement (including adversely affecting the rights or ability of any Party to successfully pursue indemnification, contribution or payment
pursuant to Sections 6 and 7). 
 9.23. Authorization. Each of the Parties hereby represents and warrants that it has the power and
authority to execute, deliver and perform this Agreement, that this Agreement has been duly authorized by all necessary corporate action on the part of such Party, that this Agreement constitutes a legal, valid and binding obligation of each such
Party and that the execution, delivery and performance of this Agreement by such Party does not contravene or conflict with any provision of law or of its charter or bylaws or any material agreement, instrument or order binding on such Party.

 9.24. Setoff. All payments to be made by any Party under this Agreement may be netted against payments due to such Party under this
Agreement, but otherwise shall be made without setoff, counterclaim or withholding, all of which are hereby expressly waived. 
 9.25.
Confidentiality. The Parties shall comply with the confidentiality provisions in Article VIII of the Separation Agreement. 
  

 28 

 9.26. Affiliates. Each of the Parties shall cause to be performed all actions, agreements and
obligations set forth herein to be performed by any Affiliate of such Party or by any entity that becomes an Affiliate of such Party on and after the Distribution Date; provided, however, that if a Spectra Energy Affiliate ceases to be a Spectra
Energy Affiliate as a result of a transfer of its stock or other ownership interests to a third party in exchange for consideration in an amount approximately equal to the fair market value of the stock or other ownership interests transferred and
such consideration is not distributed outside of the Spectra Energy Group to the shareholders of Spectra Energy then Duke Energy shall, upon request, execute a release of such Spectra Energy Affiliate from its obligations under this Agreement upon
such transfer provided that such Spectra Energy Affiliate shall have executed a release of any rights it may have against Duke Energy or any Duke Energy Affiliate by reason of this Agreement. 
 9.27. Construction. The Parties have participated jointly in the negotiation and drafting of this Agreement. This Agreement shall be construed
without regard to any presumption or rule requiring construction or interpretation against the party drafting or causing any instrument to be drafted. 
 9.28. Effective Time. This Agreement shall be effective as of the Effective Time. 
 [Signature Pages
Follow] 
  

 29 

 IN WITNESS WHEREOF, the Parties caused this Tax Matters Agreement to be duly executed as of the day and
year first above written. 
  

			
	DUKE ENERGY CORPORATION
		
	By:	 	/s/ James E. Rogers
	Name:	 	James E. Rogers
	Title:	 	President and Chief Executive Officer
	
	 SPECTRA ENERGY CORP
 on behalf of itself and
each of the Other Spectra Energy Parties

		
	By:	 	/s/ Fred J. Fowler
	Name:	 	Fred J. Fowler
	Title:	 	President and Chief Executive Officer

 [Signature Page to Tax Matters Agreement] 

 Appendix A 
 Illustrative Distribution Taxes Examples 
 Example 1: After the Distribution Date, Spectra Energy contemplates
entering into a transaction. Spectra Energy receives a Supplemental Tax Opinion or Supplemental Ruling that the transaction will not result in Distribution Taxes. That Supplemental Tax Opinion or Supplemental Ruling relies in part on an
Officer’s Certificate provided by Duke Energy. That Officer’s Certificate provided by Duke Energy contains a material misstatement. If Distribution Taxes arise solely because of the material misstatement in the Officer’s Certificate
provided by Duke Energy, Duke Energy shall be liable for such Distribution Taxes under Section 4.01(a) (and Spectra Energy shall not be liable for such Distribution Taxes under Section 4.01(b)), notwithstanding the fact that such
Distribution Taxes resulted from a Spectra Energy transaction. 
 Example 2: After the Distribution Date, Duke Energy contemplates entering into a
transaction. Duke Energy receives a Supplemental Tax Opinion or Supplemental Ruling that the transaction will not result in Distribution Taxes. That Supplemental Tax Opinion or Supplemental Ruling relies in part on an Officer’s Certificate
provided by Spectra Energy. That Officer’s Certificate provided by Spectra Energy contains a material misstatement. If Distribution Taxes arise solely because of the material misstatement in the Officer’s Certificate provided by Spectra
Energy, Spectra Energy and each Spectra Energy Affiliate other than the Excluded Spectra Energy Affiliates shall be jointly and severally liable for such Distribution Taxes under Section 4.01(b) (and Duke Energy shall not be liable for such
Distribution Taxes under Section 4.01(a)), notwithstanding the fact that such Distribution Taxes resulted from a Duke Energy transaction. 
  

 A-1 

 CONFIDENTIAL 
 EXECUTION COPY 
 SCHEDULES 
 TO 
 TAX MATTERS AGREEMENT 
 by and among 
 DUKE ENERGY
CORPORATION, 
 SPECTRA ENERGY CORP, and 
 THE OTHER SPECTRA ENERGY PARTIES 
 Dated as of December 13, 2006 

 CONFIDENTIAL 
  

 SCHEDULES 
 Capitalized terms used in these Schedules and not otherwise defined in these Schedules shall have the respective meanings ascribed thereto in the body of the Tax Matters Agreement referenced on the first page of these
Schedules (the “Agreement”). 
 The headings in these Schedules are for convenience of reference only, do not form a part of these
Schedules and shall not be deemed to limit or otherwise affect any of the disclosure in these Schedules. 

 CONFIDENTIAL 
  

 Schedule 3.01(g) 
 Spectra Energy Liability for Taxes 
  

	1.	Any Taxes resulting from Duke Energy’s, Spectra Energy’s, or any of their respective Affiliates’ ownership of Engage Energy Canada Co. or Engage Energy Canada, LP
during any tax period, whether beginning before or after the Distribution Date. 

  

	2.	Any Taxes resulting from the recognition of gain or the recharacterization of income as a result of Duke Energy Field Services, LLC’s sale of Texas Eastern Products Pipeline
Company, LLC (the general partner of TEPPCO Partners, LP), and Duke Energy’s sale of its limited partner interest in TEPPCO Partners, LP. 

  

 -1- 

 CONFIDENTIAL 
  

 Schedule 3.02(f) 
 Duke Energy Liability for Taxes Tax Items 
  

	1.	Notwithstanding anything in Section 3.03(b) of the Agreement, any Taxes resulting from the recognition of gain if such gain recognition is a result of any restructuring of the
ownership of Duke Energy Nova Scotia Holdings Co. undertaken to effect the Separation. 

  

 -2-

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