Document:

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                              AMENDED AND RESTATED
                              EMPLOYMENT AGREEMENT

         This AMENDED AND RESTATED EMPLOYMENT AGREEMENT is made and entered into
as of the 31st day of August, 2001, by and between Cinergy and Charles J. Winger
(the "Executive"). This Agreement replaces and supersedes any and all prior
employment agreements between Cinergy and the Executive. The capitalized words
and terms used throughout this Agreement are defined in Section 11.

                                    RECITALS

         A. The Executive is currently serving as Vice President of Cinergy, and
Vice President, Corporate Development of Cinergy, and Cinergy desires to secure
the continued employment of the Executive in accordance with this Agreement.

         B. The Executive is willing to continue to remain in the employ of
Cinergy on the terms and conditions set forth in this Agreement.

         C. The parties intend that this Agreement will replace and supersede
any and all prior employment agreements between Cinergy (or any component
company or business unit of Cinergy) and the Executive.

                                    AGREEMENT

         In consideration of the mutual promises, covenants and agreements set
forth below, the parties agree as follows:

1.       EMPLOYMENT AND TERM

         a.       Cinergy agrees to employ the Executive, and the Executive
                  agrees to remain in the employ of Cinergy, in accordance with
                  the terms and provisions of this Agreement, for the Employment
                  Period set forth in Subsection b. The parties agree that the
                  Company will be responsible for carrying out all of the
                  promises, covenants, and agreements of Cinergy set forth in
                  this Agreement.

         b.       The Employment Period of this Agreement will commence as of
                  the Effective Date and continue until December 31, 2004;
                  provided that, commencing on December 31, 2002, and on each
                  subsequent December 31, the Employment Period will be extended
                  for one (1) additional year unless either party gives the
                  other party written notice not to extend this Agreement at
                  least ninety (90) days before the extension would otherwise
                  become effective.

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2.       DUTIES AND POWERS OF EXECUTIVE

         a.       POSITION. The Executive will serve Cinergy as Vice President
                  of Cinergy, and Vice President, Corporate Development of
                  Cinergy, and he will have such responsibilities, duties, and
                  authority as are customary for someone of that position and
                  such additional duties, consistent with his position, as may
                  be assigned to him from time to time during the Employment
                  Period by the Board of Directors, the Chief Executive Officer,
                  or the senior executive officer to whom he directly reports.
                  Executive shall devote substantially all of Executive's
                  business time, efforts and attention to the performance of
                  Executive's duties under this Agreement; provided, however,
                  that this requirement shall not preclude Executive from
                  reasonable participation in civic, charitable or professional
                  activities or the management of Executive's passive
                  investments, so long as such activities do not materially
                  interfere with the performance of Executive's duties under
                  this Agreement.

         b.       PLACE OF PERFORMANCE. In connection with the Executive's
                  employment, the Executive will be based at the principal
                  executive offices of Cinergy, 221 East Fourth Street,
                  Cincinnati, Ohio. Except for required business travel to an
                  extent substantially consistent with the present business
                  travel obligations of Cinergy executives who have positions of
                  authority comparable to that of the Executive, the Executive
                  will not be required to relocate to a new principal place of
                  business that is more than thirty (30) miles from Cinergy's
                  principal executive offices.

3.       COMPENSATION. The Executive will receive the following compensation for
         his services under this Agreement.

         a.       SALARY. The Executive's Annual Base Salary, payable in pro
                  rata installments not less often than semi-monthly, will be at
                  the annual rate of not less than $350,004.00. Any increase in
                  the Annual Base Salary will not serve to limit or reduce any
                  other obligation of Cinergy under this Agreement. The Annual
                  Base Salary will not be reduced except for across-the-board
                  salary reductions similarly affecting all Cinergy management
                  personnel. If Annual Base Salary is increased or reduced
                  during the Employment Period, then such adjusted salary will
                  thereafter be the Annual Base Salary for all purposes under
                  this Agreement.

         b.       RETIREMENT, INCENTIVE, WELFARE BENEFIT PLANS AND OTHER
                  BENEFITS. During the Employment Period, the Executive will be
                  eligible, and Cinergy will take all necessary action to cause
                  the Executive to become eligible, to participate in short-term
                  and long-term incentive, stock option, restricted stock,
                  performance unit, savings, retirement and welfare plans,
                  practices, policies and programs applicable generally to other
                  senior executives of Cinergy who are considered Tier II
                  executives for compensation purposes, except with respect to
                  any plan, practice, policy or program to which the Executive
                  has waived his rights in writing.

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                  The Executive will be entitled and fully vested in a
                  supplemental retirement benefit equal to the difference
                  between (1) his total benefit under all Executive Retirement
                  Plans, and (2) 60% of the Executive's Highest Average
                  Earnings. The form, timing, and method of payment of the
                  supplemental retirement benefit payable under this Paragraph
                  will be the same as those elected by the Executive under the
                  Pension Plan. If the Executive dies prior to his retirement,
                  and if his Spouse, on the date of his death, is living on the
                  date the first installment of the supplemental retirement
                  benefit would be payable under this Paragraph, the Spouse will
                  be entitled to receive the supplemental retirement benefit as
                  a Spouse's benefit. The form, timing, and method of payment of
                  any Spouse's benefit under this Paragraph will be the same as
                  those applicable to the Spouse under the Pension Plan.

                  Upon his retirement, the Executive will be eligible for
                  comprehensive medical and dental benefits which are not
                  materially different from the benefits provided under the
                  Retirees' Medical Plan and the Retirees' Dental Plan. The
                  Executive, however, will receive the maximum level of subsidy
                  currently applicable to similarly situated active Cinergy
                  employees that is provided by Cinergy to retirees, as of the
                  Effective Date of this Agreement, for purposes of determining
                  the amount of monthly premiums due from the Executive.

                  The Executive will be a participant in the Annual Incentive
                  Plan, and the Executive will be paid pursuant to the terms and
                  conditions of that plan an annual benefit of up to seventy
                  percent (70%) of the Executive's Annual Base Salary (the
                  "Maximum Annual Bonus"), with a target of no less than forty
                  percent (40%) of the Executive's Annual Base Salary (the
                  "Target Annual Bonus").

                  The Executive will be a participant in the Long-Term Incentive
                  Plan (the "LTIP"), and the Executive's annualized target award
                  opportunity under the LTIP will be equal to no less than
                  ninety percent (90%) of his Annual Base Salary (the "Target
                  LTIP Bonus").

         c.       FRINGE BENEFITS AND PERQUISITES. During the Employment Period,
                  the Executive will be entitled to the following additional
                  fringe benefits in accordance with the terms and conditions of
                  Cinergy's policies and practices for such fringe benefits:

                  (i)      Cinergy will furnish to the Executive an automobile
                           appropriate for the Executive's level of position,
                           or, at Cinergy's discretion, a cash allowance of
                           equivalent value. Cinergy will also pay all of the
                           related expenses for gasoline, insurance,
                           maintenance, and repairs, or provide for such
                           expenses within the cash allowance.

                  (ii)     Cinergy will pay the initiation fee and the annual
                           dues, assessments, and other membership charges of
                           the Executive for membership in a country club
                           selected by the Executive.

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                  (iii)    Cinergy will provide paid vacation for four (4) weeks
                           per year (or such longer period for which Executive
                           is otherwise eligible under Cinergy's policy).

                  (iv)     Cinergy will furnish to the Executive annual
                           financial planning and tax preparation services.

                  (v)      Cinergy will provide other fringe benefits in
                           accordance with Cinergy plans, practices, programs,
                           and policies in effect from time to time,
                           commensurate with his position and at least
                           comparable to those received by other Cinergy Tier II
                           executives.

         d.       EXPENSES. Cinergy agrees to reimburse the Executive for all
                  expenses, including those for travel and entertainment,
                  properly incurred by him in the performance of his duties
                  under this Agreement in accordance with the policies
                  established from time to time by the Board of Directors.

         e.       RELOCATION BENEFITS. Following termination of the Executive's
                  employment for any reason (other than death), the Executive
                  will be entitled to reimbursement from Cinergy for the
                  reasonable costs of relocating from the Cincinnati, Ohio, area
                  to a new primary residence in a manner that is consistent with
                  the terms of the Relocation Program. Notwithstanding the
                  foregoing, if the Executive becomes employed by another
                  employer and is eligible to receive relocation benefits under
                  another employer-provided plan, any benefits provided to the
                  Executive under this Subsection 3e will be secondary to those
                  provided under the other employer-provided relocation plan.
                  The executive must report to Cinergy any such relocation
                  benefits that he actually receives under another
                  employer-provided plan.

4.       TERMINATION OF EMPLOYMENT

         a.       DEATH. The Executive's employment will terminate automatically
                  upon the Executive's death during the Employment Period.

         b.       BY CINERGY FOR CAUSE. Cinergy may terminate the Executive's
                  employment during the Employment Period for Cause. For
                  purposes of this Employment Agreement, "Cause" means the
                  following:

                  (i)      The willful and continued failure by the Executive to
                           substantially perform the Executive's duties with
                           Cinergy (other than any such failure resulting from
                           the Executive's incapacity due to physical or mental
                           illness) that, if curable, has not been cured within
                           30 days after the Board of Directors or the Chief
                           Executive Officer has delivered to the Executive a
                           written demand for substantial performance, which
                           demand specifically identifies the manner in which
                           the Executive has not substantially performed his

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                           duties. This event will constitute Cause even if the
                           Executive issues a Notice of Termination for Good
                           Reason pursuant to Subsection 4d after the Board of
                           Directors or Chief Executive Officer delivers a
                           written demand for substantial performance.

                  (ii)     The breach by the Executive of the confidentiality
                           provisions set forth in Section 9.

                  (iii)    The conviction of the Executive for the commission of
                           a felony, including the entry of a guilty or nolo
                           contendere plea, or any willful or grossly negligent
                           action or inaction by the Executive that has a
                           materially adverse effect on Cinergy. For purposes of
                           this definition of Cause, no act, or failure to act,
                           on the Executive's part will be deemed "willful"
                           unless it is done, or omitted to be done, by the
                           Executive in bad faith and without reasonable belief
                           that the Executive's act, or failure to act, was in
                           the best interest of Cinergy.

         c.       BY CINERGY WITHOUT CAUSE. Cinergy may, upon at least 30 days
                  advance written notice to the Executive, terminate the
                  Executive's employment during the Employment Period for a
                  reason other than Cause, but the obligations placed upon
                  Cinergy in Section 5 will apply.

         d.       BY THE EXECUTIVE FOR GOOD REASON. The Executive may terminate
                  his employment during the Employment Period for Good Reason.
                  For purposes of this Agreement, "Good Reason" means the
                  following:

                  (i)      A reduction in the Executive's Annual Base Salary,
                           except for across-the-board salary reductions
                           similarly affecting all Cinergy management personnel,
                           or a reduction in any other benefit or payment
                           described in Section 3 of this Agreement, except for
                           changes to the employee benefits programs generally
                           affecting Cinergy management personnel, provided that
                           those changes, in the aggregate, will not result in a
                           material adverse change with respect to the benefits
                           to which the Executive was entitled as of the
                           Effective Date.

                  (ii)     The material reduction without his consent of the
                           Executive's title, authority, duties, or
                           responsibilities from those in effect immediately
                           prior to the reduction, or a material adverse change
                           in the Executive's reporting responsibilities.

                  (iii)    Any breach by Cinergy of any other material provision
                           of this Agreement (including but not limited to the
                           place of performance as specified in Subsection 2b).

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                  (iv)     The Executive's disability due to physical or mental
                           illness or injury that precludes the Executive from
                           performing any job for which he is qualified and able
                           to perform based upon his education, training or
                           experience.

                  (v)      A failure by the Company to require any successor
                           entity to the Company specifically to assume in
                           writing all of the Company's obligations to the
                           Executive under this Agreement.

         For purposes of determining whether Good Reason exists with respect to
a Qualifying Termination occurring on or within 24 months following a Change in
Control, any claim by the Executive that Good Reason exists shall be presumed to
be correct unless the Company establishes to the Board by clear and convincing
evidence that Good Reason does not exist.

         e.       BY THE EXECUTIVE WITHOUT GOOD REASON. The Executive may
                  terminate his employment without Good Reason upon prior
                  written notice to the Company.

         f.       NOTICE OF TERMINATION. Any termination of the Executive's
                  employment by Cinergy or by the Executive during the
                  Employment Period (other than a termination due to the
                  Executive's death) will be communicated by a written Notice of
                  Termination to the other party to this Agreement in accordance
                  with Subsection 12b. For purposes of this Agreement, a "Notice
                  of Termination" means a written notice that specifies the
                  particular provision of this Agreement relied upon and that
                  sets forth in reasonable detail the facts and circumstances
                  claimed to provide a basis for terminating the Executive's
                  employment under the specified provision. The failure by the
                  Executive or Cinergy to set forth in the Notice of Termination
                  any fact or circumstance that contributes to a showing of Good
                  Reason or Cause will not waive any right of the Executive or
                  Cinergy under this Agreement or preclude the Executive or
                  Cinergy from asserting that fact or circumstance in enforcing
                  rights under this Agreement.

5.       OBLIGATIONS OF CINERGY UPON TERMINATION.

         a.       CERTAIN TERMINATIONS.

                  (i)      If a Qualifying Termination occurs during the
                           Employment Period, Cinergy will pay to the Executive
                           a lump sum amount, in cash, equal to the sum of the
                           following Accrued Obligations:

                           (1)      the pro-rated portion of the Executive's
                                    Annual Base Salary payable through the Date
                                    of Termination, to the extent not previously
                                    paid.

                           (2)      any amount payable to the Executive under
                                    the Annual Incentive Plan in respect of the
                                    most recently completed fiscal year, to the
                                    extent not theretofore paid.

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                           (3)      an amount equal to the AIP Benefit for the
                                    fiscal year that includes the Date of
                                    Termination multiplied by a fraction, the
                                    numerator of which is the number of days
                                    from the beginning of that fiscal year to
                                    and including the Date of Termination and
                                    the denominator of which is three hundred
                                    and sixty-five (365). The AIP Benefit
                                    component of the calculation will be equal
                                    to the annual bonus that would have been
                                    earned by the Executive pursuant to any
                                    annual bonus or incentive plan maintained by
                                    Cinergy in respect of the fiscal year in
                                    which occurs the Date of Termination,
                                    determined by projecting Cinergy's
                                    performance and other applicable goals and
                                    objectives for the entire fiscal year based
                                    on Cinergy's performance during the period
                                    of such fiscal year occurring prior to the
                                    Date of Termination, and based on such other
                                    assumptions and rates as Cinergy deems
                                    reasonable.

                           (4)      the Accrued Obligations described in this
                                    Paragraph 5a(i) will be paid within thirty
                                    (30) days after the Date of Termination.
                                    These Accrued Obligations are payable to the
                                    Executive regardless of whether a Change in
                                    Control has occurred.

                  (ii)     In the event of a Qualifying Termination either prior
                           to the occurrence of a Change in Control, or more
                           than twenty-four (24) months following the occurrence
                           of a Change in Control, Cinergy will pay the Accrued
                           Obligations, and Cinergy will have the following
                           additional obligations:

                           (1)      Cinergy will pay to the Executive a lump sum
                                    amount, in cash, equal to three (3) times
                                    the sum of the Annual Base Salary and the
                                    Annual Bonus. For this purpose, the Annual
                                    Base Salary will be at the rate in effect at
                                    the time Notice of Termination is given
                                    (without giving effect to any reduction in
                                    Annual Base Salary, if any, prior to the
                                    termination, other than across-the-board
                                    reductions), and the Annual Bonus will be
                                    the higher of (A) the annual bonus earned by
                                    the Executive pursuant to any annual bonus
                                    or incentive plan maintained by Cinergy in
                                    respect of the year ending immediately prior
                                    to the fiscal year in which occurs the Date
                                    of Termination, and (B) the annual bonus
                                    that would have been earned by the Executive
                                    pursuant to any annual bonus or incentive
                                    plan maintained by Cinergy in respect of the
                                    fiscal year in which occurs the Date of
                                    Termination, calculated by projecting
                                    Cinergy's performance and other applicable
                                    goals and objectives for the entire fiscal
                                    year based on Cinergy's performance during
                                    the period of such fiscal year occurring
                                    prior to the Date of Termination, and based
                                    on such other assumptions and rates as
                                    Cinergy deems reasonable; provided, however
                                    that for purposes of this Subsection
                                    5a(ii)(1)(B), the Annual Bonus shall not be
                                    less

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                                    than the Target Annual Bonus, nor greater
                                    than the Maximum Annual Bonus for the year
                                    in which the Date of Termination occurs.
                                    This lump sum will be paid within thirty
                                    (30) days of the Date of Termination.

                           (2)      Subject to Clauses (A), (B) and (C) below,
                                    Cinergy will provide, until the end of the
                                    Employment Period, medical and dental
                                    benefits to the Executive and/or the
                                    Executive's dependents at least equal to
                                    those that would have been provided if the
                                    Executive's employment had not been
                                    terminated (excluding benefits to which the
                                    Executive has waived his rights in writing).
                                    The benefits described in the preceding
                                    sentence will be in accordance with the
                                    medical and welfare benefit plans,
                                    practices, programs, or policies of Cinergy
                                    (the "M&W Plans") as then currently in
                                    effect and applicable generally to other
                                    Cinergy senior executives and their
                                    families.

                                    (A)     If, as of the Executive's Date of
                                            Termination, the Executive meets the
                                            eligibility requirements for
                                            Cinergy's retiree medical and
                                            welfare benefit plans, the provision
                                            of those retiree medical and welfare
                                            benefit plans to the Executive will
                                            satisfy Cinergy's obligation under
                                            this Subparagraph 5a(ii)(2).

                                    (B)      If, as of the Executive's Date of
                                             Termination, the provision to the
                                             Executive of the M&W Plan benefits
                                             described in this Subparagraph
                                             5a(ii)(2) would either (1) violate
                                             the terms of the M&W Plans (or any
                                             related insurance policies) or (2)
                                             violate any of the Code's
                                             nondiscrimination requirements
                                             applicable to the M&W Plans, then
                                             Cinergy, in its sole discretion,
                                             may elect to pay the Executive, in
                                             lieu of the M&W Plan benefits
                                             described under this Subparagraph
                                             5a(ii)(2), a lump sum cash payment
                                             equal to the total monthly premiums
                                             (or in the case of a self funded
                                             plan, the cost of COBRA
                                             continuation coverage) that would
                                             have been paid by Cinergy for the
                                             Executive under the M&W Plans from
                                             the Date of Termination through the
                                             end of the Employment Period,
                                             grossed up for the effect of
                                             federal, state and local income
                                             taxes. Nothing in this Clause will
                                             affect the Executive's right to
                                             elect COBRA continuation coverage
                                             under a M&W Plan in accordance with
                                             applicable law, and Cinergy will
                                             make the payment described in this
                                             Clause whether or not the Executive
                                             elects COBRA continuation coverage,
                                             and whether or not the Executive
                                             receives health coverage from
                                             another employer.

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                                    (C)     If the Executive becomes employed by
                                            another employer and is eligible to
                                            receive medical or other welfare
                                            benefits under another
                                            employer-provided plan, any benefits
                                            provided to the Executive under the
                                            M&W Plans will be secondary to those
                                            provided under the other
                                            employer-provided plan during the
                                            Executive's applicable period of
                                            eligibility.

                           (3)      Cinergy will provide tax counseling services
                                    through an agency selected by the Executive,
                                    not to exceed fifteen thousand dollars
                                    ($15,000.00) in cost.

                  (iii) In the event of a Qualifying Termination during the
                  twenty-four (24) month period beginning upon the occurrence of
                  a Change in Control, Cinergy will pay the Accrued Obligations,
                  and Cinergy will also have the following additional
                  obligations:

                           (1)      Cinergy will pay to the Executive a lump sum
                                    severance payment, in cash, equal to three
                                    (3) times the higher of (x) the sum of the
                                    Executive's current Annual Base Salary and
                                    Target Annual Bonus and (y) the sum of the
                                    Executive's Annual Base Salary in effect
                                    immediately prior to the Change in Control
                                    and the Change in Control Bonus. For
                                    purposes of this Agreement, the Change in
                                    Control Bonus shall mean the higher of (A)
                                    the annual bonus earned by the Executive
                                    pursuant to any annual bonus or incentive
                                    plan maintained by Cinergy in respect of the
                                    year ending immediately prior to the fiscal
                                    year in which occurs the Date of Termination
                                    or, if higher, immediately prior to the
                                    fiscal year in which occurs the Change in
                                    Control, and (B) the annual bonus that would
                                    have been earned by the Executive pursuant
                                    to any annual bonus or incentive plan
                                    maintained by Cinergy in respect of the year
                                    in which occurs the Date of Termination,
                                    calculated by projecting Cinergy's
                                    performance and other applicable goals and
                                    objective for the entire fiscal year based
                                    on Cinergy's performance during the period
                                    of such fiscal year occurring prior to the
                                    Date of Termination, and based on such other
                                    assumptions and rates as Cinergy deems
                                    reasonable, provided, however, that for
                                    purposes of this Subsection 5a(iii)(1)(B),
                                    such Change in Control Annual Bonus shall
                                    not be less than the Target Annual Bonus,
                                    nor greater than the Maximum Annual Bonus.
                                    This lump sum will be paid within thirty
                                    (30) days of the Date of Termination.

                           (2)      Cinergy will pay to the Executive the lump
                                    sum present value of any benefits under the
                                    Executive Supplemental Life Program under
                                    the terms of the applicable plan or program
                                    as of the Date of Termination, calculated as
                                    if the Executive was fully vested as of the

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                                    Date of Termination. The lump sum present
                                    value, assuming commencement at age as of
                                    the Date of Termination, will be determined
                                    using the interest rate applicable to lump
                                    sum payments in the Cinergy Corp. Non-Union
                                    Employees' Pension Plan or any successor to
                                    that plan for the plan year that includes
                                    the Date of Termination. To the extent no
                                    such interest rate is provided therein, the
                                    annual interest rate applicable under
                                    section 417(e)(3) of the Code, or any
                                    successor provision thereto, for the second
                                    full calendar month preceding the first day
                                    of the calendar year that includes the Date
                                    of Termination will be used. This lump sum
                                    will be paid within thirty (30) days of the
                                    Date of Termination.

                           (3)      The Executive shall be fully vested in his
                                    accrued benefits as of the Date of
                                    Termination under the Executive Retirement
                                    Plans, and his accrued benefits thereunder
                                    will be calculated as if the Executive was
                                    credited with three (3) additional years of
                                    age and service as of the Date of
                                    Termination. For purposes of determining
                                    benefits under the Executive Retirement
                                    Plans, the definition of earnings will be
                                    the same as defined in such plans.

                           (4)      For a thirty-six (36) month period after the
                                    Date of Termination, Cinergy will arrange to
                                    provide to the Executive and/or the
                                    Executive's dependents life, disability,
                                    accident, and health insurance benefits
                                    substantially similar to those that the
                                    Executive and/or the Executive's dependents
                                    are receiving immediately prior to the
                                    Notice of Termination at a substantially
                                    similar cost to the Executive (without
                                    giving effect to any reduction in those
                                    benefits subsequent to a Change in Control
                                    that constitutes Good Reason), except for
                                    any benefits that were waived by the
                                    Executive in writing. If Cinergy arranges to
                                    provide the Executive and/or the Executive's
                                    dependents with life, disability, accident,
                                    and health insurance benefits, those
                                    benefits will be reduced to the extent
                                    comparable benefits are actually received by
                                    or made available to the Executive and/or
                                    the Executive's dependents during the
                                    thirty-six (36) month period following the
                                    Executive's Date of Termination. The
                                    Executive must report to Cinergy any such
                                    benefits that he or his dependents actually
                                    receives. In lieu of the benefits described
                                    in the preceding sentences, Cinergy, in its
                                    sole discretion, may elect to pay to the
                                    Executive a lump sum cash payment equal to
                                    thirty-six (36) times the monthly premiums
                                    (or in the case of a self funded plan, the
                                    cost of COBRA continuation coverage) that
                                    would have been paid by Cinergy to provide
                                    those benefits to the Executive and/or the
                                    Executive's dependents, grossed up for the
                                    effect of federal, state and local income
                                    taxes. Nothing in this Subparagraph
                                    5a(iii)(4) will affect the Executive's right
                                    to elect COBRA continuation coverage in
                                    accordance with

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                                    applicable law, and Cinergy will make the
                                    payment described in this Clause whether or
                                    not the Executive elects COBRA continuation
                                    coverage, and whether or not the Executive
                                    receives health coverage from another
                                    employer.

                           (5)      Title and ownership of the automobile
                                    assigned to the Executive by Cinergy will be
                                    transferred to the Executive within thirty
                                    (30) days of the Date of Termination. To the
                                    extent there is imputed income to the
                                    Executive resulting from the transfer of
                                    title, the Executive will receive a cash
                                    payment equal to the amount of federal,
                                    state and local income taxes resulting from
                                    this transfer as soon as administratively
                                    feasible after the transfer is effective. At
                                    Cinergy's discretion, a cash payment of an
                                    equivalent value of the automobile and
                                    corresponding income taxes may be paid in
                                    lieu of the assignment of the automobile.

                           (6)      Cinergy will provide tax counseling services
                                    through an agency selected by the Executive,
                                    not to exceed fifteen thousand dollars
                                    ($15,000.00) in cost.

                           (7)      Cinergy will provide annual dues and
                                    assessments of the Executive for membership
                                    in a country club selected by the Executive
                                    until the end of the Employment Period.

                           (8)      Cinergy will provide outplacement services
                                    suitable to the Executive's position until
                                    the end of the Employment Period or, if
                                    earlier, until the first acceptance by the
                                    Executive of an offer of employment. At the
                                    Executive's discretion, 15% of Annual Base
                                    Salary may be paid in lieu of outplacement
                                    services.

         For purposes of this Paragraph 5a(iii), the Executive will be deemed to
have incurred a Qualifying Termination upon a Change in Control if the
Executive's employment is terminated prior to a Change in Control, without Cause
at the direction of a Person who has entered into an agreement with Cinergy, the
consummation of which will constitute a Change in Control, or if the Executive
terminates his employment for Good Reason prior to a Change in Control if the
circumstances or event that constitutes Good Reason occurs at the direction of
such a Person.

         b.       TERMINATION BY CINERGY FOR CAUSE OR BY THE EXECUTIVE OTHER
                  THAN FOR GOOD REASON. Subject to the provisions of Section 7,
                  and notwithstanding any other provisions of this Agreement, if
                  the Executive's employment is terminated for Cause during the
                  Employment Period, or if the Executive terminates employment
                  during the Employment Period other than a termination for Good
                  Reason, Cinergy will have no further obligations to the
                  Executive under this Agreement other than the obligation to
                  pay to the Executive the Accrued Obligations, plus any other
                  earned but unpaid compensation, in each case to the extent not
                  previously paid.

                                      -11-
<Page>

         c.       CERTAIN TAX CONSEQUENCES.

                  (i)      In the event that any Severance Benefits paid or
                           payable to the Executive or for his benefit pursuant
                           to the terms of this Agreement or otherwise in
                           connection with, or arising out of, his employment
                           with Cinergy or a change in ownership or effective
                           control of Cinergy or of a substantial portion of its
                           assets (a "Payment" or "Payments") would be subject
                           to any Excise Tax, then the Executive will be
                           entitled to receive an additional payment (a
                           "Gross-Up Payment") in an amount such that after
                           payment by the Executive of all taxes (including any
                           interest, penalties, additional tax, or similar items
                           imposed with respect thereto and the Excise Tax),
                           including any Excise Tax imposed upon the Gross-Up
                           Payment, the Executive retains an amount of the
                           Gross-Up Payment equal to the Excise Tax imposed upon
                           or assessable against the Executive due to the
                           Payments.

                  (ii)     Subject to the provisions of Section 5(iii), all
                           determinations required to be made under this Section
                           5c, including whether and when a Gross-Up Payment is
                           required and the amount of such Gross-Up Payment and
                           the assumptions to be utilized in arriving at such
                           determination, shall be made by the Accounting Firm,
                           which shall provide detailed supporting calculations
                           both to the Company and the Executive within fifteen
                           (15) business days of the receipt of notice from the
                           Executive that there has been a Payment, or such
                           earlier time as is requested by the Company. All fees
                           and expenses of the Accounting Firm shall be borne
                           solely by the Company. Any Gross-Up Payment, as
                           determined pursuant to this Section 5c, shall be paid
                           by Cinergy to the Executive within five (5) days of
                           the receipt of the Accounting Firm's determination.
                           Any determination by the Accounting Firm shall be
                           binding upon Cinergy and the Executive. However, as a
                           result of the uncertainty in the application of
                           Section 4999 of the Code at the time of the initial
                           determination by the Accounting Firm hereunder, it is
                           possible that Gross-Up Payments which will not have
                           been made by Cinergy should have been made
                           ("Underpayment"), consistent with the calculations
                           required to be made hereunder. In the event that
                           Cinergy exhausts its remedies pursuant to Section
                           5c(iii) and the Executive thereafter is required to
                           make a payment of any Excise Tax, the Accounting Firm
                           shall determine the amount of the Underpayment that
                           has occurred and any such Underpayment shall be
                           promptly paid by Cinergy to or for the benefit of the
                           Executive. In the event that the Excise Tax is
                           subsequently determined to be less than the amount
                           taken into account hereunder at the time of
                           termination of the Executive's employment, the
                           Executive shall repay to the Company, at the time
                           that the amount of such reduction in Excise Tax is
                           finally determined, the portion of the Gross-Up
                           Payment attributable to such reduction (plus that
                           portion of the Gross-Up Payment attributable to the
                           Excise Tax and federal, state and local income

                                      -12-
<Page>

                           and employment tax imposed on the Gross-Up Payment
                           being repaid by the Executive to the extent that such
                           repayment results in a reduction in Excise Tax and/or
                           a federal, state or local income or employment tax
                           deduction) plus interest on the amount of such
                           repayment at the rate provided in Code section
                           1274(b)(2)(B).

                  (iii)    The value of any non-cash benefits or any deferred
                           payment or benefit paid or payable to the Executive
                           will be determined in accordance with the principles
                           of Code sections 280G(d)(3) and (4). For purposes of
                           determining the amount of the Gross-Up Payment, the
                           Executive will be deemed to pay federal income taxes
                           at the highest marginal rate of federal income
                           taxation in the calendar year in which the Gross-Up
                           Payment is to be made and applicable state and local
                           income taxes at the highest marginal rate of taxation
                           in the state and locality of the Executive's
                           residence on the Date of Termination, net of the
                           maximum reduction in federal income taxes that would
                           be obtained from deduction of those state and local
                           taxes.

                  (iv)     Notwithstanding anything contained in this Agreement
                           to the contrary, in the event that, according to the
                           Accounting Firm's determination, an Excise Tax will
                           be imposed on any Payment or Payments, Cinergy will
                           pay to the applicable government taxing authorities
                           as Excise Tax withholding, the amount of the Excise
                           Tax that Cinergy has actually withheld from the
                           Payment or Payments in accordance with law.

         d.       VALUE CREATION PLAN AND STOCK OPTIONS. Upon the Executive's
                  termination of employment for any reason, the Executive's
                  entitlement to restricted shares and performance shares under
                  the Value Creation Plan and any stock options granted under
                  the Stock Option Plan or the LTIP will be determined under the
                  terms of the appropriate plan and any applicable
                  administrative guidelines and written agreements.

         e.       DEFERRED COMPENSATION PLAN AND 401(K) EXCESS PLAN. Upon the
                  Executive's termination of employment for any reason, the
                  Executive's entitlements, if any, under the Non-Qualified
                  Deferred Compensation Plan and 401(k) Excess Plan shall be
                  distributed under the terms of such plans and any applicable
                  administrative guidelines and written agreements.

         f.       OTHER FEES AND EXPENSES. Cinergy will also reimburse the
                  Executive for all reasonable legal fees and expenses incurred
                  by the Executive in successfully disputing a Qualifying
                  Termination that entitles the Executive to Severance Benefits.
                  Payment will be made within five (5) business days after
                  delivery of the Executive's written request for payment
                  accompanied by such evidence of fees and expenses incurred as
                  Cinergy reasonably may require.

                                      -13-
<Page>

6.       NON-EXCLUSIVITY OF RIGHTS. Nothing in this Agreement will prevent or
         limit the Executive's continuing or future participation in any
         benefit, plan, program, policy, or practice provided by Cinergy and for
         which the Executive may qualify, except with respect to any benefit to
         which the Executive has waived his rights in writing or any plan,
         program, policy, or practice that expressly excludes the Executive from
         participation. In addition, nothing in this Agreement will limit or
         otherwise affect the rights the Executive may have under any other
         contract or agreement with Cinergy entered into after the Effective
         Date. Amounts that are vested benefits or that the Executive is
         otherwise entitled to receive under any benefit, plan, program, policy,
         or practice of, or any contract or agreement entered into after the
         Effective Date with Cinergy, at or subsequent to the Date of
         Termination, will be payable in accordance with that benefit, plan,
         program, policy or practice, or that contract or agreement, except as
         explicitly modified by this Agreement.

7.       FULL SETTLEMENT: MITIGATION. Cinergy's obligation to make the payments
         provided for in this Agreement and otherwise to perform its obligations
         under this Agreement will not be affected by any set-off, counterclaim,
         recoupment, defense, or other claim, right, or action that Cinergy may
         have against the Executive or others. In no event will the Executive be
         obligated to seek other employment or take any other action by way of
         mitigation of the amounts (including amounts for damages for breach)
         payable to the Executive under any of the provisions of this Agreement
         and, except as provided in Subsection 3e and Subparagraphs 5a(ii)(2)
         and 5a(iii)(4), those amounts will not be reduced simply because the
         Executive obtains other employment. If the Executive finally prevails
         on the substantial claims brought with respect to any dispute between
         Cinergy and the Executive as to the interpretation, terms, validity, or
         enforceability of (including any dispute about the amount of any
         payment pursuant to) this Agreement, Cinergy agrees to pay all
         reasonable legal fees and expenses that the Executive may reasonably
         incur as a result of that dispute.

8.       ARBITRATION. The parties agree that any dispute, claim, or controversy
         based on common law, equity, or any federal, state, or local statute,
         ordinance, or regulation (other than workers' compensation claims)
         arising out of or relating in any way to the Executive's employment,
         the terms, benefits, and conditions of employment, or concerning this
         Agreement or its termination and any resulting termination of
         employment, including whether such a dispute is arbitrable, shall be
         settled by arbitration. This agreement to arbitrate includes but is not
         limited to all claims for any form of illegal discrimination, improper
         or unfair treatment or dismissal, and all tort claims. The Executive
         will still have a right to file a discrimination charge with a federal
         or state agency, but the final resolution of any discrimination claim
         will be submitted to arbitration instead of a court or jury. The
         arbitration proceeding will be conducted under the employment dispute
         resolution arbitration rules of the American Arbitration Association in
         effect at the time a demand for arbitration under the rules is made.
         The decision of the arbitrator(s), including determination of the
         amount of any damages suffered, will be exclusive, final, and binding
         on all parties, their heirs, executors, administrators, successors and
         assigns. Each party will bear its own expenses in the arbitration for
         arbitrators' fees and attorneys'

                                      -14-
<Page>

         fees, for its witnesses, and for other expenses of presenting its case.
         Other arbitration costs, including administrative fees and fees for
         records or transcripts, will be borne equally by the parties.
         Notwithstanding anything in this Section to the contrary, if the
         Executive prevails with respect to any dispute submitted to arbitration
         Section, Cinergy will reimburse or pay all legal fees and expenses that
         under this the Executive may reasonably incur as a result of the
         dispute as required by Section 7.

9.       CONFIDENTIAL INFORMATION. The Executive will hold in a fiduciary
         capacity for the benefit of Cinergy, as well as all of Cinergy's
         successors and assigns, all secret, confidential information,
         knowledge, or data relating to Cinergy, and its affiliated businesses,
         that the Executive obtains during the Executive's employment by Cinergy
         or any of its affiliated companies, and that has not been or
         subsequently becomes public knowledge (other than by acts by the
         Executive or representatives of the Executive in violation of this
         Agreement). During the Employment Period and thereafter, the Executive
         will not, without Cinergy's prior written consent or as may otherwise
         by required by law or legal process, communicate or divulge any such
         information, knowledge, or data to anyone other than Cinergy and those
         designated by it. The Executive understands that during the Employment
         Period, Cinergy may be required from time to time to make public
         disclosure of the terms or existence of the Executive's employment
         relationship to comply with various laws and legal requirements. In
         addition to all other remedies available to Cinergy in law and equity,
         this Agreement is subject to termination by Cinergy for Cause under
         Section 4b in the event the Executive violates any provision of this
         Section.

10.      SUCCESSORS.

         a.       This Agreement is personal to the Executive and, without
                  Cinergy's prior written consent, cannot be assigned by the
                  Executive other than Executive's designation of a beneficiary
                  of any amounts payable hereunder after the Executive's death.
                  This Agreement will inure to the benefit of and be enforceable
                  by the Executive's legal representatives.

         b.       This Agreement will inure to the benefit of and be binding
                  upon Cinergy and its successors and assigns.

         c.       Cinergy will require any successor (whether direct or
                  indirect, by purchase, merger, consolidation or otherwise) to
                  all or substantially all of the business and/or assets of
                  Cinergy to assume expressly and agree to perform this
                  Agreement in the same manner and to the same extent that
                  Cinergy would be required to perform it if no succession had
                  taken place. Cinergy's failure to obtain such an assumption
                  and agreement prior to the effective date of a succession will
                  be a breach of this Agreement and will entitle the Executive
                  to compensation from Cinergy in the same amount and on the
                  same terms as if the Executive were to terminate his
                  employment for Good Reason upon a Change in Control, except

                                      -15-
<Page>

                  that, for purposes of implementing the foregoing, the date on
                  which any such succession becomes effective will be deemed the
                  Date of Termination.

11.      DEFINITIONS. As used in this Agreement, the following terms, when
         capitalized, will have the following meanings:

         a.       ACCOUNTING FIRM. "Accounting Firm" means Cinergy's independent
                  auditors.

         b.       ACCRUED OBLIGATIONS. "Accrued Obligations" means the accrued
                  obligations described in Paragraph 5a(i).

         c.       AGREEMENT. "Agreement" means this Amended and Restated
                  Employment Agreement between Cinergy and the Executive.

         d.       AIP BENEFIT. "AIP Benefit" means the Annual Incentive Plan
                  benefit described in Subsection 5a(i).

         e.       ANNUAL BASE SALARY. "Annual Base Salary" means the annual base
                  salary payable to the Executive pursuant to Subsection 3a.

         f.       ANNUAL BONUS. "Annual Bonus" has the meaning set forth in
                  Subsection 5a(ii)(1).

         g.       ANNUAL INCENTIVE PLAN. "Annual Incentive Plan" means the
                  Cinergy Corp. Annual Incentive Plan or any similar plan or
                  successor to the Annual Incentive Plan.

         h.       BOARD OF DIRECTORS. "Board of Directors" means the board of
                  directors of the Company.

         i.       COBRA. "COBRA" means the Consolidated Omnibus Budget
                  Reconciliation Act of 1985, as amended.

         j.       CAUSE.  "Cause" has the meaning set forth in Subsection 4b.

         k.       CHANGE IN CONTROL. "A Change in Control" will be deemed to
                  have occurred if any of the following events occur, after the
                  Effective Date:

                  (i)      Any "person" or "group" (within the meaning of
                           subsection 13(d) and paragraph 14(d)(2) of the 1934
                           Act) is or becomes the beneficial owner (as defined
                           in Rule l3d-3 under the 1934 Act), directly or
                           indirectly, of securities of the Company (not
                           including in the securities beneficially owned by
                           such a Person any securities acquired directly from
                           the Company or its affiliates) representing more than
                           twenty percent (20%) of the combined voting power of
                           the Company's then outstanding securities,

                                      -16-
<Page>

                           excluding any person who becomes such a beneficial
                           owner in connection with a transaction described in
                           Clause (1) of Paragraph (ii) below; or

                  (ii)     There is consummated a merger or consolidation of the
                           Company or any direct or indirect subsidiary of the
                           Company with any other corporation, other than (1) a
                           merger or consolidation that would result in the
                           voting securities of the Company outstanding
                           immediately prior to that merger or consolidation
                           continuing to represent (either by remaining
                           outstanding or by being converted into voting
                           securities of the surviving entity or its parent) at
                           least sixty percent (60%) of the combined voting
                           power of the securities of the Company or the
                           surviving entity or its parent outstanding
                           immediately after the merger or consolidation, or (2)
                           a merger or consolidation effected to implement a
                           recapitalization of the Company (or similar
                           transaction) in which no person is or becomes the
                           beneficial owner, directly or indirectly, of
                           securities of the Company (not including in the
                           securities beneficially owned by such a Person any
                           securities acquired directly from the Company or its
                           affiliates other than in connection with the
                           acquisition by the Company or its affiliates of a
                           business) representing twenty percent (20%) or more
                           of the combined voting power of the Company's then
                           outstanding securities; or

                  (iii)    During any period of two (2) consecutive years,
                           individuals who at the beginning of that period
                           constitute the Board of Directors and any new
                           director (other than a director whose initial
                           assumption of office is in connection with an actual
                           or threatened election contest, including but not
                           limited to a consent solicitation, relating to the
                           election of directors of the Company) whose
                           appointment or election by the Company's shareholders
                           was approved or recommended by a vote of at least
                           two-thirds (2/3) of the directors then still in
                           office who either were directors at the beginning of
                           that period or whose appointment, election, or
                           nomination for election was previously so approved or
                           recommended cease for any reason to constitute a
                           majority of the Board of Directors; or

                  (iv)     The shareholders of the Company approve a plan of
                           complete liquidation or dissolution of the Company or
                           there is consummated an agreement for the sale or
                           disposition by the Company of all or substantially
                           all of the Company's assets, other than a sale or
                           disposition by the Company of all or substantially
                           all of the Company's assets to an entity, at least
                           sixty percent (60%) of the combined voting power of
                           the voting securities of which are owned by
                           shareholders of the Company in substantially the same
                           proportions as their ownership of the Company
                           immediately prior to the sale.

         l.       CHANGE IN CONTROL BONUS. "Change in Control Bonus" has the
                  meaning set forth in Subsection 5a(iii)(1).

                                      -17-
<Page>

         m.       CHIEF EXECUTIVE OFFICER. "Chief Executive Officer" means the
                  chief executive officer of the Company.

         n.       CINERGY. "Cinergy" means the Company, its subsidiaries, and/or
                  its affiliates, and any successors to the foregoing.

         o.       CODE. "Code" means the Internal Revenue Code of 1986, as
                  amended, and interpretive rules and regulations.

         p.       COMPANY.  "Company" means Cinergy Corp.

         q.       DATE OF TERMINATION.  "Date of Termination" means:

                  (i)      if the Executive's employment is terminated by the
                           Company for Cause, or by the Executive with Good
                           Reason, the date of receipt of the Notice of
                           Termination or any later date specified in the
                           notice, as the case may be;

                  (ii)     if the Executive's employment is terminated by the
                           Executive without Good Reason, thirty (30) days after
                           the date on which the Executive notifies the Company
                           of the termination;

                  (iii)    if the Executive's employment is terminated by the
                           Company other than for Cause, thirty (30) days after
                           the date on which the Company notifies the Executive
                           of the termination; and

                  (iv)     if the Executive's employment is terminated by reason
                           of death, the date of death.

         r.       DEFERRED COMPENSATION PLAN. "Deferred Compensation Plan" means
                  the Cinergy Corp. Non-Qualified Deferred Incentive
                  Compensation Plan or any similar plan or successor to that
                  plan.

         s.       EFFECTIVE DATE.  "Effective Date" means August 31, 2001.

         t.       EMPLOYMENT PERIOD. "Employment Period" has the meaning set
                  forth in Subsection 1b.

         u.       EXCISE TAX. "Excise Tax" means any excise tax imposed by Code
                  section 4999, together with any interest, penalties,
                  additional tax or similar items that are incurred by the
                  Executive with respect to the excise tax imposed by Code
                  section 4999.

         v.       EXECUTIVE.  "Executive" means Charles J. Winger.

                                      -18-
<Page>

         w.       EXECUTIVE RETIREMENT PLANS. "Executive Retirement Plans" means
                  the Cinergy Corp. Non-Union Employees' Pension Plan, the
                  Cinergy Corp. Supplemental Executive Retirement Plan and the
                  Cinergy Corp. Excess Pension Plan or any similar plans or
                  successors to those plans.

         x.       EXECUTIVE SUPPLEMENTAL LIFE PROGRAM. "Executive Supplemental
                  Life Program" means the Cinergy Corp. Executive Supplemental
                  Life Insurance Program or any similar program or successor to
                  the Executive Supplemental Life Program.

         y.       401(K) EXCESS PLAN. "401(k) Excess Plan" means the Cinergy
                  Corp. 401(k) Excess Plan, or any similar plan or successor to
                  that plan.

         z.       GOOD REASON. "Good Reason" has the meaning set forth in
                  Subsection 4d.

         aa.      GROSS-UP PAYMENT. "Gross-Up Payment" has the meaning set forth
                  in Subsection 5c.

         bb.      HIGHEST AVERAGE EARNINGS. "Highest Average Earnings" means the
                  greater of (a) the Executive's "Highest Average Earnings" as
                  defined in the Pension Plan (without regard to the limitation
                  of Code paragraph 401(a)(17)) or (b) the Executive's Earnings
                  for the 12 consecutive calendar months immediately preceding
                  his termination of employment with Cinergy.

         cc.      LONG-TERM INCENTIVE PLAN OR LTIP. "Long-Term Incentive Plan"
                  or "LTIP" means the long-term incentive plan implemented under
                  the Cinergy Corp. 1996 Long-Term Incentive Compensation Plan
                  or any successor to that plan.

         dd.      M&W PLANS. "M&W Plans" has the meaning set forth in
                  Subparagraph 5a(ii)(2).

         ee.      MAXIMUM ANNUAL BONUS. "Maximum Annual Bonus" has the meaning
                  set forth in Subsection 3b.

         ff.      NOTICE OF TERMINATION. "Notice of Termination" has the meaning
                  set forth in Subsection 4f.

         gg.      PAYMENT OR PAYMENTS. "Payment" or "Payments" has the meaning
                  set forth in Subsection 5c.

         hh.      PENSION PLAN. "Pension Plan" means the Cinergy Corp. Non-Union
                  Employees' Pension Plan or any successor to that plan.

         ii.      PERSON. "Person" has the meaning set forth in paragraph
                  3(a)(9) of the 1934 Act, as modified and used in subsections
                  13(d) and 14(d) of the 1934 Act; however, a Person will not
                  include the following:

                                      -19-
<Page>

                  (i)      Cinergy or any of its subsidiaries;

                  (ii)     A trustee or other fiduciary holding securities under
                           an employee benefit plan of Cinergy or its
                           subsidiaries;

                  (iii)    An underwriter temporarily holding securities
                           pursuant to an offering of those securities; or

                  (iv)     A corporation owned, directly or indirectly, by the
                           stockholders of the Company in substantially the same
                           proportions as their ownership of stock of the
                           Company.

         jj.      QUALIFYING TERMINATION. "Qualifying Termination" means (i) the
                  termination by the Company of the Executive's employment with
                  Cinergy other than a termination for Cause or (ii) the
                  termination by the Executive of the Executive's employment
                  with Cinergy for Good Reason.

         kk.      RELOCATION PROGRAM. "Relocation Program" means the Cinergy
                  Corp. Relocation Program, or any similar program or successor
                  to that program, as in effect on the date of the Executive's
                  termination of employment.

         ll.      RETIREES' DENTAL PLAN. "Retirees' Dental Plan" means the
                  Cinergy Corp. Retirees' Dental program or any similar program
                  or successor to that program.

         mm.      RETIREES' MEDICAL PLAN. "Retirees' Medical Plan" means the
                  Cinergy Corp. Retirees' Medical program or any similar program
                  or successor to that program.

         nn.      SEVERANCE BENEFITS. "Severance Benefits" means the payments
                  and benefits payable to the Executive pursuant to Section 5.

         oo.      SPOUSE. "Spouse" means the Executive's lawfully married
                  spouse. For this purpose, common law marriage or a similar
                  arrangement will not be recognized unless otherwise required
                  by federal law.

         pp.      STOCK RELATED DOCUMENTS. "Stock Related Documents" means the
                  LTIP, the Cinergy Corp. Stock Option Plan, and the Value
                  Creation Plan and any applicable administrative guidelines and
                  written agreements relating to those plans.

         qq.      TARGET ANNUAL BONUS. "Target Annual Bonus" has the meaning set
                  forth in Subsection 3b.

         rr.      TARGET LTIP BONUS. "Target LTIP Bonus" has the meaning set
                  forth in Subsection 3b.

                                      -20-
<Page>

         ss.      VALUE CREATION PLAN. "Value Creation Plan" means the Value
                  Creation Plan or any similar plan, or successor plan of the
                  LTIP.

12.      MISCELLANEOUS.

         a.       This Agreement will be governed by and construed in accordance
                  with the laws of the State of Ohio, without reference to
                  principles of conflict of laws. The captions of this Agreement
                  are not part of its provisions and will have no force or
                  effect. This Agreement may not be amended, modified, repealed,
                  waived, extended, or discharged except by an agreement in
                  writing signed by the party against whom enforcement of the
                  amendment, modification, repeal, waiver, extension, or
                  discharge is sought. Only the Chief Executive Officer or his
                  designee will have authority on behalf of Cinergy to agree to
                  amend, modify, repeal, waive, extend, or discharge any
                  provision of this Agreement.

         b.       All notices and other communications under this Agreement will
                  be in writing and will be given by hand delivery to the other
                  party or by Federal Express or other comparable national or
                  international overnight delivery service, addressed as
                  follows:

                  IF TO THE EXECUTIVE:
                  Charles J. Winger
                  Cinergy Corp.
                  221 East Fourth Street
                  Cincinnati, Ohio 45201-0960

                  IF TO CINERGY:
                  Cinergy Corp.
                  221 East Fourth Street
                  Cincinnati, Ohio  45201-0960
                  Attn: Chief Executive Officer

                  or to such other address as either party has furnished to the
                  other in writing in accordance with this Agreement. All
                  notices and communications will be effective when actually
                  received by the addressee.

         c.       The invalidity or unenforceability of any provision of this
                  Agreement will not affect the validity or enforceability of
                  any other provision of this Agreement.

         d.       Cinergy may withhold from any amounts payable under this
                  Agreement such federal, state, or local taxes as are required
                  to be withheld pursuant to any applicable law or regulation.

         e.       The Executive's or Cinergy's failure to insist upon strict
                  compliance with any provision of this Agreement or the failure
                  to assert any right the Executive or

                                      -21-
<Page>

                  Cinergy may have under this Agreement, including without
                  limitation the right of the Executive to terminate employment
                  for Good Reason pursuant to Subsection 4d or the right of
                  Cinergy to terminate the Executive's employment for Cause
                  pursuant to Subsection 4b, will not be deemed to be a waiver
                  of that provision or right or any other provision or right of
                  this Agreement.

         f.       References in this Agreement to the masculine include the
                  feminine unless the context clearly indicates otherwise.

         g.       This instrument contains the entire agreement of the Executive
                  and Cinergy with respect to the subject matter of this
                  Agreement; and subject to any agreements evidencing stock
                  option or restricted stock grants described in Subsection 3b
                  and the Stock Related Documents, all promises,
                  representations, understandings, arrangements, and prior
                  agreements are merged into this Agreement and accordingly
                  superseded.

         h.       This Agreement may be executed in counterparts, each of which
                  will be deemed to be an original but all of which together
                  will constitute one and the same instrument.

         i.       Cinergy and the Executive agree that Cinergy Services, Inc.
                  will be authorized to act for Cinergy with respect to all
                  aspects pertaining to the administration and interpretation of
                  this Agreement.

         IN WITNESS WHEREOF, the Executive and the Company have caused this
Agreement to be executed as of the Effective Date.

                                   CINERGY SERVICES, INC.

                                   By:  /s/ James E. Rogers
                                      ------------------------------
                                        James E. Rogers
                                        Chairman and
                                        Chief Executive Officer

                                   EXECUTIVE

                                     /s/ Charles J. Winger
                                   ---------------------------------
                                   Charles J. Winger

                                      -22-<Page>

                                  CINERGY CORP.
            AMENDED AND RESTATED SEPARATION AND RETIREMENT AGREEMENT
                       AND WAIVER AND RELEASE OF LIABILITY

         This Amended and Restated Separation and Retirement Agreement and
Waiver and Release of Liability (the "Agreement"), which is effective as of this
15th day of February, 2002, is entered into by and between Larry E. Thomas (the
"Executive") and Cinergy Corp., with the mutual exchange of promises as
consideration. Capitalized words and terms used throughout this Agreement that
are not defined elsewhere in this Agreement are defined in Section 22.

                                    RECITALS

     A.   The Executive has elected to terminate voluntarily his employment with
Cinergy and retire effective March 31, 2002.

     B.   The Executive resigned from his position as Chief Executive Officer of
the Power Technology & Infrastructure Services Business Unit ("Former Position")
effective June 30, 2001 and continued in the employ of Cinergy in a new position
with the title of Vice Chairman of Public Service Indiana (PSI) ("New Position")
following such resignation from such Former Position and plans to continue in
such New Position until his retirement on March 31, 2002. Cinergy desires to
have the Executive serve in the New Position until his retirement and is willing
to relocate the Executive to Indianapolis, Indiana and to provide certain
additional benefits and arrangements to the Executive, provided that the
Executive executes and does not timely revoke this Agreement.

     C.   Previously, the Executive and Cinergy negotiated certain additional
separation benefits to be paid to the Executive in exchange for his voluntary
retirement provided that the Executive executed (and did not timely revoke) the
Cinergy Corp. Separation and Retirement Agreement and Waiver and Release of
Liability and timely executed and did not timely revoke a waiver and release, in
the form attached to the Cinergy Corp. Separation and Retirement Agreement and
Waiver and Release of Liability as Exhibit A, of all claims that the Executive
might be able to assert against Cinergy and certain related entities and
individuals.

     D.   The parties have agreed to enter into this Agreement, which has been
specifically negotiated between the Executive and Cinergy. The parties
acknowledge and agree that this Agreement replaces and supersedes (i) the
Amended and Restated Employment Agreement dated December 30, 1999 ("Employment
Agreement") and (ii) and the Cinergy Corp. Separation and Retirement Agreement
and Waiver and Release of Liability.

     THEREFORE, Cinergy and the Executive enter into the following Agreement:

                                    AGREEMENT

     1.   NEW POSITION, RELOCATION, AND RETIREMENT.

          a.   RESIGNATION FROM FORMER POSITION. The Executive agreed to resign
from his Former Position effective June 30, 2001, and did so resign.

<Page>

          b.   NEW POSITION. Cinergy extended to the Executive, and the
Executive accepted, the New Position effective July 1, 2001. The New Position is
located in the metropolitan area of Indianapolis, Indiana. The duties of the New
Position are those duties assigned to the Executive by the Chief Executive
Officer of the Company from time to time. Until March 31, 2002, the compensation
and prerequisites for the New Position will be the same as those for the
Executive's Former Position as provided in Section 3 of the Employment
Agreement.

          c.   RELOCATION. In June of 2001, the Executive relocated to the
metropolitan area of Indianapolis, Indiana, pursuant to the terms of the
Executive Relocation Agreement.

          d.   TERMINATION OF EMPLOYMENT. The Executive will retire, and his
employment with Cinergy will terminate, effective as of the close of business on
March 31, 2002.

          e.   EFFECT ON OTHER AGREEMENTS. This Agreement replaces and
supersedes, except as otherwise provided in Section 1.b of this Agreement, any
and all prior employment, separation and retirement agreements between Cinergy
and the Executive, including but not limited to (i) the Employment Agreement and
(ii) the Cinergy Corp. Separation and Retirement Agreement and Waiver and
Release of Liability.

     2.   SEPARATION BENEFITS. In exchange for resigning from employment,
entering into this Agreement, and satisfying any additional conditions set forth
in this Agreement, the Executive will receive the following benefits, as a
result of negotiations between the parties, which benefits shall be payable
following March 31, 2002 as described below:

          a.   SEVERANCE PAY. After March 31, 2002, provided that the Executive
timely executes and does not timely revoke a waiver and release, in the form
attached to this Agreement as EXHIBIT A, of all claims that the Executive might
be able to assert against Cinergy and certain related entities and individuals
(the "Waiver and Release"), Cinergy agrees to pay the Executive, in lieu of any
other severance benefits that might be payable to the Executive under the
Employment Agreement, severance pay in the gross amount of $3,382,276.00. This
amount, less applicable tax withholdings, will be paid in a lump sum within 10
days after the expiration of the revocation period described in the Waiver and
Release.

          b.   RETIREE WELFARE BENEFITS. After March 31, 2002, provided that the
Executive executes and does not timely revoke the Waiver and Release, upon his
retirement, pursuant to this Agreement, the Executive will be entitled to
comprehensive retiree medical and dental coverage pursuant to the terms of the
Cinergy Corp. Welfare Benefits Program. The Executive will receive the maximum
subsidy provided by Cinergy to retirees for purposes of determining the amount
of the monthly premiums due from the Executive.

          c.   VACATION PAY. After March 31, 2002, provided that the Executive
executes and does not timely revoke the Waiver and Release, within 10 days after
the expiration of the revocation period described in the Waiver and Release, the
Executive will receive, in a lump sum cash payment, fifteen (15) weeks of
accrued but unused vacation pay in the gross amount of $158,656.20, less
applicable tax withholdings.

                                       -2-
<Page>

          d.   WAIVER OF PREPAYMENT PENALTY. If the prepayment penalty under
Cinergy's Executive Stock Purchase Program is waived for any participant in that
program, it will also be waived for the Executive.

          e.   EXECUTIVE SUPPLEMENTAL LIFE INSURANCE. After March 31, 2002,
provided that the Executive timely executes and does not timely revoke the
Waiver and Release, the Executive will receive the value of the additional life
insurance provided to the Executive under the Executive Supplemental Life
Insurance Program, which is $150,000. This amount will be paid to the Executive
in cash, in equal annual installments of $15,000, less applicable tax
withholdings, over a 10-year period beginning in February of 2003.

          f.   STOCK OPTIONS. Any rights the Executive may have with respect to
the stock options granted to the Executive on October 24, 1994 will be
determined under the terms of the incentive stock option agreement dated October
24, 1994 the nonqualified stock option agreement dated October 24, 1994, and the
Cinergy Corp. Stock Option Plan effective October 24, 1994. Similarly, any
rights the Executive may have with respect to the stock options granted to the
Executive pursuant to the Cinergy Corp. 1996 Long-Term Incentive Compensation
Plan ("LTIP") will be determined under the LTIP, the relevant Administrative
Guidelines and any incentive stock option agreement or nonqualified stock option
agreement that the Executive may have been required to sign with regard to those
options.

          g.   LONG-TERM INCENTIVE PLAN. After March 31, 2002, provided that the
Executive timely executes and does not revoke the Waiver and Release, the
Executive shall receive any performance shares award to which he may become
entitled under Cycle IV, Cycle V and Cycle VI of the LTIP and the Cinergy Corp.
Value Creation Plan The amount of any such award shall be determined and
pro-rated, and any such award shall be paid to the Executive, in accordance with
the terms of the LTIP, the Value Creation Plan, any relevant administrative
guidelines, and any applicable performance shares agreements.

          h.   TAX COUNSELING. After March 31, 2002, provided that the Executive
timely executes and does not timely revoke the Waiver and Release, Cinergy will
provide tax counseling services to the Executive through an agency selected by
the Executive, not to exceed $15,000 in cost.

          i.   AUTOMOBILE ALLOWANCE. After March 31, 2002, provided that the
Executive executes and does not timely revoke the Waiver and Release, the
Executive will receive a lump sum payment of $50,000, grossed up to cover any
applicable federal and state income taxes, to cover the cost of the Executive's
automobile. This amount, less applicable withholding taxes, will be paid to the
Executive within fifteen (15) days after the expiration of the revocation period
described in the Waiver and Release.

          j.   COMPUTER ALLOWANCE. After March 31, 2002, provided that the
Executive executes and does not timely revoke the Waiver and Release, the
Executive will receive a lump sum payment of $2,000, grossed up for applicable
federal and state income taxes, which payment will be reduced by applicable
withholding taxes, to cover the cost of a computer and printer. This amount will
be paid to the Executive within fifteen (15) days after the expiration of the
revocation period described in the Waiver and Release.

                                      -3-
<Page>

          k.   SUPPLEMENTAL RETIREMENT BENEFIT. The Executive shall be entitled
to the benefits described in this Section 2.k but only if, after March 31, 2002,
he timely executes and does not revoke the Waiver and Release. The Executive
will be entitled to, and fully vested in, a supplemental retirement benefit in
an annual amount equal to the excess of (1) 60% of the Executive's Highest
Average Earnings over (2) his total aggregate annual benefit under the Pension
Plan and the Cinergy Corp. Excess Pension Plan, PROVIDED, HOWEVER, that the
amount in clause (2) above shall be calculated based upon the assumption that
the Executive elects to receive the distribution of his benefits under the
Pension Plan and the Cinergy Corp. Excess Pension Plan in the form of a
contingent pension option which provides a reduced pension to the Executive
during his lifetime and an equal amount (i.e., the 100% option) to the
Executive's Spouse during her lifetime if she survives the Executive; and
PROVIDED FURTHER, HOWEVER, that the Executive's Spouse, if she survives the
Executive, shall be entitled to receive a supplemental retirement benefit in an
amount equal to the monthly amount received by the Executive, the payment of
which shall commence upon the Executive's death and shall continue during the
remaining portion of the Spouse's life. Notwithstanding the preceding sentence,
the amount of the supplemental retirement benefit payable to the Executive shall
be calculated without regard to the fact that the Spouse, if she survives the
Executive, shall also be entitled to a benefit under this Section 2.k. All terms
in this Section 2.k with initial capital letters that are not defined in this
Agreement shall have the meaning given to such terms in the Employment
Agreement. The benefits provided pursuant to this Section 2.k shall be provided
to the Executive in accordance with the funding provisions of Article 12 of the
Cinergy Corp. Supplemental Executive Retirement Plan ("SERP") and any trust that
has been established in connection with the SERP (including the Master Trust for
Cinergy Corp. Nonqualified Deferred Compensation Plans); PROVIDED, HOWEVER, that
the benefit provided to the Executive pursuant to this Section 2.k shall be in
lieu of any benefit provided to the Executive under the SERP and the Executive
shall not be entitled to any benefit under that plan.

          l.   2001 ANNUAL INCENTIVE PLAN. The Executive shall receive a lump
sum payment, less applicable withholding taxes, equal to the excess of (a) the
incentive award the Executive would have received under the Cinergy Corp. Annual
Incentive Plan ("AIP") for the 2001 performance period if he attained a level
three payout with respect to both corporate and individual goals over (b) the
incentive award the Executive actually received under the AIP for the 2001
performance period.

          m.   2002 ANNUAL INCENTIVE PLAN. After March 31, 2002, provided the
Executive timely executes and does not timely revoke the Waiver and Release, the
Executive will receive an AIP award for the 2002 performance period equal to 25%
of the award that he would have received if he had remained employed until the
date of payment of the award, which award will be paid based on a level three
payout with respect to both individual and corporate goals, which payment shall
be reduced by applicable withholding taxes and shall be payable in March, 2003.

     3.   RELEASE AND INDEMNITY. Cinergy irrevocably and unconditionally
releases and discharges the Executive and will indemnify, save and hold
harmless, and defend the Executive from any and all claims, losses, demands,
suits, actions, causes of action, damages, costs, and expenses, including
attorneys' fees, payments, judgments, and any and all liability arising, or
alleged to arise, in whole or in part, from or out of, in any manner whatsoever,
any work performed by the Executive while he was employed by Cinergy.

                                      -4-
<Page>

     4.   BASIS FOR ENTITLEMENT. The Executive acknowledges that he would not be
entitled to certain of the benefits described in this Agreement absent his
election to terminate employment voluntarily and retire voluntarily and his
execution of this Agreement and the Waiver and Release.

     5.   ADEQUATE CONSIDERATION. The Executive agrees that this Agreement
provides good, valuable, and sufficient consideration for the obligations he
assumes in Sections 6 through 13 and Section 17 and the Waiver and Release.

     6.   WAIVER OF CLAIMS. The Executive irrevocably and unconditionally waives
and releases any and all rights or claims that he has or may have, as of the
date of the execution of this Agreement, based on or arising out of the
employment relationship, or the termination of the employment relationship,
against Cinergy, its employee benefit plans, or any of their respective current
or former officers, directors, agents, employees, fiduciaries, attorneys,
insurers, predecessors, successors, or assigns (together, the "Releasees"),
other than workers' compensation claims filed prior to the date of execution of
this Agreement and claims for vested benefits under the terms of Cinergy's
qualified pension and profit sharing plans. The rights and claims so waived
include, but are not limited to, the following:

          a.   Claims and rights arising under any federal, state, or local
statute, ordinance, or common law (including, but not limited to, claims for
breach of promise, breach of contract, promissory estoppel, intentional
infliction of emotional distress, negligent misrepresentation, defamation, and
wrongful discharge) or claims in equity or public policy;

          b.   Claims and rights arising under any law relating to sex, race,
age, religion, disability, or national origin discrimination (including but not
limited to any rights or claims arising under Title VII of the Civil Rights Act
of 1964, the Age Discrimination in Employment Act of 1967, the Employee
Retirement Income Security Act of 1974, the Americans with Disabilities Act, the
Fair Labor Standards Act of 1938, the Family and Medical Leave Act, the Indiana
Civil Rights Law, the Kentucky Labor and Human Rights Law, and the Ohio Fair
Employment Practices Law, as those laws may be amended from time to time);

          c.   Claims or rights arising under the civil rights laws of any state
or municipality; and

          d.   Any claims for compensatory damages, punitive damages, attorneys'
fees, expenses, and litigation costs.

     7.   FUTURE EMPLOYMENT. The Executive waives any right to assert any claim
or demand for reemployment with Cinergy. The Executive, however, may accept an
offer of reemployment with Cinergy in the event such an offer is made.

     8.   NONDISCLOSURE OF CONFIDENTIAL INFORMATION. The Executive will not at
any time, directly or indirectly, use any trade secrets or confidential
information of Cinergy for his benefit or the benefit of any other person or,
directly or indirectly, disclose any trade secrets or confidential information
of Cinergy to any other person, unless he is required by law or any lawful
authority to do so. For purposes of this Section, "confidential information of
Cinergy" means all secret, proprietary information, knowledge, or data relating
to Cinergy and its businesses that have been obtained by the Executive during
the Executive's employment by

                                      -5-
<Page>

Cinergy that have not been now or subsequently become public knowledge (other
than by acts of the Executive or representatives of the Executive in
violation of this Agreement).

     9.   CONSULTING ARRANGEMENT. The Executive agrees to serve as a business
consultant to Cinergy for a period of three (3) years beginning on the
Termination Date (the "Consulting Period"). The consulting services to be
provided by the Executive during the Consulting Period will consist of
consultation with, and advice to, the officers and managerial employees of
Cinergy, as requested by Cinergy, on matters relating to Cinergy's business
affairs about which the Executive has knowledge and experience. The consulting
services will be performed at reasonable times when and as needed, as determined
by mutual agreement between Cinergy and the Executive. The parties understand
and agree that all of the consulting services to be provided by the Executive
under this Agreement will be performed by him as an independent contractor and
not as an employee of Cinergy. The Executive will not have any authority to act
as an agent or representative of Cinergy, except to the extent expressly
authorized in writing by Cinergy. The Executive will perform his consulting
services to the best of his abilities. The Executive's duties pursuant to this
Paragraph are purely those of a consultant, and Cinergy is free to accept or
reject his advice as it deems appropriate. Cinergy is responsible for all
actions it chooses to take based on the Executive's advice, and Cinergy agrees
to hold the Executive harmless for the results of those actions, including all
losses and damages resulting from any legal or regulatory action. Cinergy will
reimburse the Executive for all expenses authorized by Cinergy and incurred by
the Executive, including but not limited to telephone, duplication, secretarial
services, mail and courier services, and normal supplies that may reasonably be
required. Reimbursement will be made within thirty (30) days of Cinergy's
receipt of reasonable and customary documentation. For any travel requested and
authorized by Cinergy, the Executive will be reimbursed for all reasonable and
customary expenses, including transportation, parking, food, and lodging.
Nothing in this Section 9 will prohibit the Executive from seeking or accepting
other employment, engaging in any other consulting services, or participating in
any other endeavor for profit, as he deems appropriate, provided that, in so
doing, he does not breach any of his other obligations under this Agreement.

     10.  NON-SOLICITATION AND NON-COMPETITION. At no time during the Consulting
Period will the Executive: (a) employ or seek to employ any person employed at
that time by Cinergy or otherwise encourage or entice any such person to leave
employment with Cinergy; (b) become employed by, enter into a consulting
arrangement with, or otherwise agree to perform personal services for, a
Competitor; (c) acquire an ownership interest in a Competitor, provided that the
Executive may, for investment purposes, own not more than 3% of the outstanding
stock of any class of a Competitor that is publicly traded; or (d) solicit any
customers or vendors of Cinergy on behalf of or for the benefit of a Competitor.

          The Executive acknowledges that monetary damages will not be an
adequate remedy for Cinergy in the event of a breach of this Section 10, and
that it would be impossible for Cinergy to measure damages in the even of such a
breach. Therefore, the Executive agrees that, in lieu of any other remedy that
Cinergy may have for such a breach, Cinergy is entitled to an injunction
preventing the Executive from any breach of this Section 10.

     11.  COOPERATION WITH LITIGATION. Upon Cinergy's request, the Executive
agrees to render reasonable assistance to Cinergy in connection with any
litigation or investigation relating to Cinergy's business, provided that
rendering such assistance does not impose an unreasonable

                                      -6-
<Page>

burden on the Executive. Such assistance will include, but will not be limited
to, providing information, attending meetings, assisting with interrogatories,
giving depositions, and making court appearances. The Executive agrees to notify
the General Counsel of the Company promptly of any requests for information or
testimony that the Executive receives in connection with any litigation or
investigation relating to Cinergy's business. Cinergy agrees to advance to the
Executive, without any expectation of repayment, any monies reasonably
anticipated by the Executive as necessary to discharge the Executive's
obligations under this Section and to reimburse the Executive for his time and
out-of-pocket expenses in meeting those obligations.

     12.  RETURN OF CORPORATE PROPERTY. Except as otherwise provided in this
Agreement, the Executive agrees to return to Cinergy all keys, identification
badges, electronic passes, credit cards, computer programs, and other property
belonging to Cinergy when requested and to do so by Cinergy's representative.

     13.  COMMUNICATIONS. While the Executive is employed by Cinergy and
thereafter, Cinergy will not make any untrue, disparaging, defamatory, or
derogatory statements about the Executive, and the Executive will not make any
untrue, disparaging, defamatory, or derogatory statements about Cinergy.

     14.  SEVERABILITY. If any portion of this Agreement is found to be
unenforceable for any reason, the parties agree that the remaining portions will
remain in effect (to the extent the invalidity of the particular portion does
not substantially undermine the purpose of this Agreement).

     15.  CONSULTATION WITH ATTORNEY ADVISED. The Executive is advised to
consult with an attorney prior to executing this Agreement. The Executive
acknowledges being given that advice. The Executive represents that he has read
and fully understands all of the provisions of this Agreement. The Executive
represents that he is voluntarily signing this Agreement.

     16.  TIME TO CONSIDER. The Executive acknowledges that he has been given a
period of at least twenty-one (21) days within which to consider and sign this
Agreement.

          a.   To enter into this Agreement, the Executive must execute it by
signing, dating, and returning it to James E. Rogers, Jr., Cinergy Corp., 221
East Fourth Street, Cincinnati, Ohio, 45202.

          b.   The Executive acknowledges that if he has signed this Agreement,
it is because he freely chose to do so.

          c.   The Executive may revoke this Agreement during the seven (7)
calendar days after he signs it. To be effective, a revocation must be
communicated in writing to James E. Rogers, Jr., Cinergy Corp., 221 East Fourth
Street, Cincinnati, Ohio, 45202, and delivered no later than 5:00 p.m. Eastern
Standard Time on the final day of the seven (7) day period.

     17.  CONFIDENTIALITY. The Executive covenants and agrees to keep completely
confidential and not to disclose the existence or terms of this Agreement except
to Executive's spouse, legal counsel, accountant, and financial advisors, unless
he is required by law or any lawful authority to do so. The Executive will
advise those to whom proper disclosure is made that this is a confidential
agreement, and he will instruct them that they are not to disclose the

                                      -7-

<Page>

existence or terms of this Agreement. In addition, the Executive covenants and
agrees that any breach of this confidentiality provision will be considered a
breach of this Agreement.

     18.  BINDING EFFECT OF AGREEMENT. This Agreement will be binding upon and
will operate for the benefit of, the heirs, executors, administrators, assigns,
and successors in interest of the Executive and Cinergy. Cinergy agrees that in
the event of a sale, merger, acquisition, or other change in structure
(including the cessation or restructuring of any part of Cinergy's business)
and/or ownership, Cinergy will ensure that the contract language pertaining to
the transaction confirms the continuing liability of Cinergy (and its assigns
and successors in interest) to the Executive under this Agreement.

     19.  COMPLETE AGREEMENT. Except as otherwise expressly provided in this
Agreement, the terms of this Agreement and the Waiver and Release constitute the
entire Agreement between the parties and supersede all previous communications,
representations, and agreements, oral or written, between the parties with
respect to the subject matter of this Agreement. No agreement or understanding
modifying this Agreement will be binding on either party unless it is in writing
and signed by an authorized representative of the party sought to be bound. If
any part of this Agreement is adjudged by a court of competent jurisdiction to
be contrary to law, then this Agreement will, in all other respects, remain
effective and binding to the full extent permitted by law.

     20.  ARBITRATION. The parties agree that any dispute, claim, or controversy
based on common law, equity, or any federal, state, or local statute, ordinance,
or regulation (other than workers' compensation claims) arising out of or
relating in any way to the Executive's employment, the terms, benefits, and
conditions of employment, or concerning this Agreement or its termination and
any resulting termination of employment, including whether such a dispute is
arbitrable, will be settled by arbitration. This agreement to arbitrate includes
but is not limited to all claims for any form of illegal discrimination,
improper or unfair treatment or dismissal, and all tort claims. The Executive
will still have a right to file a discrimination charge with a federal or state
agency, but the final resolution of any discrimination claim will be submitted
to arbitration instead of a court or jury. The arbitration proceeding will be
conducted under the employment dispute resolution arbitration rules of the
American Arbitration Association in effect at the time a demand for arbitration
under the rules is made. The decision of the arbitrator(s), including
determination of the amount of any damages suffered, will be exclusive, final,
and binding on all parties, their heirs, executors, administrators, successors
and assigns. Each party will bear its own expenses in the arbitration for
arbitrators' fees and attorneys' fees, for its witnesses, and for other expenses
of presenting its case. Other arbitration costs, including administrative fees
and fees for records or transcripts, will be borne equally by the parties.
Notwithstanding anything in this Section to the contrary, if the Executive
prevails with respect to any dispute submitted to arbitration under this
Section, Cinergy will reimburse or pay all legal fees and expenses that the
Executive may reasonably incur as a result of the dispute.

     21.  GOVERNING LAW. This Agreement will be interpreted, enforced, and
governed under the laws of the State of Ohio, without regard to any principles
of conflicts of laws.

     22.  DEFINITIONS. As used in this Agreement, the following terms, when
capitalized, will have the following meanings:

                                      -8-
<Page>

          a.   AGREEMENT. "Agreement" means this Amended and Restated Separation
and Retirement Agreement and Waiver and Release of Liability.

          b.   ANNUAL INCENTIVE PLAN. "Annual Incentive Plan" means the Cinergy
Corp. Annual Incentive Plan or any successor to that Plan.

          c.   CINERGY. "Cinergy" means the Company, Cinergy Services, Inc., The
Cincinnati Gas & Electric Company, and PSI Energy, Inc.

          d.   COMPANY. "Company" means Cinergy Corp.

          e.   COMPETITOR. "Competitor" means any person or entity that sells
goods or services that are directly competitive with those sold by a business
that (1) is being conducted by Cinergy at the time in question and (2) was being
conducted by Cinergy on the Termination Date. Notwithstanding anything in the
preceding sentence, goods or services will not be deemed to be competitive with
those of Cinergy solely as a result of the Executive being employed by or
otherwise associated with a business that is in competition with Cinergy but as
to which the Executive does not have direct or indirect responsibilities for the
products or services involved.

          f.   EMPLOYMENT AGREEMENT. "Employment Agreement" means the Amended
and Restated Employment Agreement between the Executive and Cinergy dated
December 30, 1999.

          g.   EXECUTIVE. "Executive" means Larry E. Thomas.

          h.   EXECUTIVE RELOCATION AGREEMENT. "Executive Relocation Agreement"
means the Cinergy Corp. Executive Relocation Agreement.

          i.   EXECUTIVE SUPPLEMENTAL LIFE PROGRAM. "Executive Supplemental Life
Program" means the Cinergy Corp. Executive Supplemental Life Insurance Program
and any successor that that plan.

          j.   NEW POSITION. "New Position" has the meaning set forth in
Subsection l.b.

          k.   TERMINATION DATE. "Termination Date" means March 31, 2002.

         IN WITNESS WHEREOF, the parties have caused this Agreement to be
executed, effective as of the date above written.

CINERGY CORP.                                  Larry E. Thomas

By:
   -------------------------------             ---------------------------------
   James E. Rogers, Jr.                        Executive

                                      -9-

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