Document:

Exhibit
10.1

Summary
of Plan Terms for 2007 Executive Short-Term Incentive Plan

The Advent
Software 2007 Executive Short-Term Incentive Plan (“the Plan”) is designed to
motivate and reward the Executive Team for short-term achievement of key
bookings, revenue and operating profit milestones during the 2007 fiscal
year.  A summary of the terms follows:

·                  The
Plan is applicable to the President and CEO and executive-level members of the
Advent’s Executive Management Team (the “Executives”)

·                  The
individual plans establish various target amounts, performance measures and
goals of the cash bonuses awarded under the Plan for each Executive.

·                  Target
amounts range from a total per individual of $90,000 to $275,000.

·                  Plan
targets are based on bookings, recognized revenue, operating profit and
individual executive performance relative to goals.

·                  The
Plan is an annual plan and is effective for fiscal year 2007. any bonuses earned will be paid in the
first quarter of 2008.

·                  The
Plan may be renewed at the election of the Company for future periods.Exhibit
10.1

$2,650,000,000

AMENDED AND
RESTATED CREDIT AGREEMENT

dated as of

June 28, 2007

among

Duke Energy Corporation

Duke Energy Carolinas,
LLC

Duke Energy Ohio, Inc.

Duke Energy Indiana, Inc.

and

Duke Energy
Kentucky, Inc.,

as Borrowers,

The Banks Listed
Herein,

Wachovia Bank, National
Association,

as Administrative
Agent,

JPMorgan Chase Bank,
National Association

Barclays Bank PLC

Bank of America, N.A.

and

Citibank, N.A.,

as Co-Syndication
Agents

and

The Bank of
Tokyo-Mitsubishi, Ltd., New York Branch

and

Credit Suisse,

as
Co-Documentation Agents

J.P. Morgan Securities
Inc. and

Wachovia Capital Markets,
LLC,

Co-Lead Arrangers and

Joint Bookrunners

TABLE OF CONTENTS

	
  

  	
   

  	
  PAGE

  
	
  Article
  1

  
	
  DEFINITIONS

  
	
   

  	
   

  	
   

  
	
  Section 1.01. 

  	
  Definitions

  	
  1

  
	
  Section 1.02. 

  	
  Accounting Terms and Determinations

  	
  15

  
	
  Section 1.03. 

  	
  Types of Borrowings

  	
  15

  
	
   

  	
   

  	
   

  
	
  Article
  2

  
	
  THE
  CREDITS

  
	
   

  	
   

  	
   

  
	
  Section 2.01. 

  	
  Commitments to Lend

  	
  15

  
	
  Section 2.02. 

  	
  Notice of Borrowings

  	
  17

  
	
  Section 2.03. 

  	
  Notice to Banks; Funding of Loans

  	
  18

  
	
  Section 2.04. 

  	
  Registry; Notes

  	
  19

  
	
  Section 2.05. 

  	
  Maturity of Loans; Effect of Cash
  Collateralization of Letters of Credit

  	
  19

  
	
  Section 2.06. 

  	
  Interest Rates

  	
  19

  
	
  Section 2.07. 

  	
  Fees

  	
  21

  
	
  Section 2.08. 

  	
  Optional Termination or Reduction of Sublimits;
  Changes to Sublimits

  	
  21

  
	
  Section 2.09. 

  	
  Method of Electing Interest Rates

  	
  22

  
	
  Section 2.10. 

  	
  Mandatory Termination of Commitments

  	
  23

  
	
  Section 2.11. 

  	
  Optional Prepayments

  	
  23

  
	
  Section 2.12. 

  	
  General Provisions as to Payments

  	
  24

  
	
  Section 2.13. 

  	
  Funding Losses

  	
  24

  
	
  Section 2.14. 

  	
  Computation of Interest and Fees

  	
  25

  
	
  Section 2.15.

  	
  Letters of Credit

  	
  25

  
	
  Section 2.16. 

  	
  Regulation D Compensation

  	
  29

  
	
  Section 2.17. 

  	
  Increase In Commitments; Additional Banks

  	
  29

  
	
  Section 2.18. 

  	
  Swingline Loans

  	
  31

  
	
   

  	
   

  	
   

  
	
  Article
  3

  
	
  CONDITIONS

  
	
   

  	
   

  	
   

  
	
  Section 3.01. 

  	
  Effectiveness

  	
  33

  
	
  Section 3.02. 

  	
  Borrowings and Issuance of Letters of Credit

  	
  35

  
	
   

  	
   

  	
   

  
	
  Article
  4

  
	
  REPRESENTATIONS
  AND WARRANTIES

  
	
   

  	
   

  	
   

  
	
  Section 4.01. 

  	
  Organization and Power

  	
  35

  
				

 

 i
 

 

	
  Section 4.02. 

  	
  Corporate and Governmental Authorization; No
  Contravention

  	
  36

  
	
  Section 4.03. 

  	
  Binding Effect

  	
  36

  
	
  Section 4.04. 

  	
  Financial Information

  	
  36

  
	
  Section 4.05. 

  	
  Regulation U

  	
  37

  
	
  Section 4.06. 

  	
  Litigation

  	
  37

  
	
  Section 4.07. 

  	
  Compliance with Laws

  	
  38

  
	
  Section 4.08. 

  	
  Taxes

  	
  38

  
	
   

  	
   

  	
   

  
	
  Article
  5

  
	
  COVENANTS

  
	
   

  	
   

  	
   

  
	
  Section 5.01. 

  	
  Information

  	
  38

  
	
  Section 5.02. 

  	
  Payment of Taxes

  	
  40

  
	
  Section 5.03. 

  	
  Maintenance of Property; Insurance

  	
  41

  
	
  Section 5.04. 

  	
  Maintenance of Existence

  	
  41

  
	
  Section 5.05. 

  	
  Compliance with Laws

  	
  41

  
	
  Section 5.06. 

  	
  Books and Records

  	
  41

  
	
  Section 5.07. 

  	
  Negative Pledge

  	
  42

  
	
  Section 5.08. 

  	
  Consolidations, Mergers and Sales of Assets

  	
  44

  
	
  Section 5.09. 

  	
  Use of Proceeds

  	
  44

  
	
  Section 5.10. 

  	
  Indebtedness/Capitalization Ratio

  	
  44

  
	
   

  	
   

  	
   

  
	
  Article
  6

  
	
  DEFAULTS

  
	
   

  	
   

  	
   

  
	
  Section 6.01. 

  	
  Events of Default

  	
  44

  
	
  Section 6.02. 

  	
  Notice of Default

  	
  46

  
	
  Section 6.03. 

  	
  Cash Cover

  	
  47

  
	
   

  	
   

  	
   

  
	
  Article
  7

  
	
  THE
  ADMINISTRATIVE AGENT

  
	
   

  	
   

  	
   

  
	
  Section 7.01. 

  	
  Appointment and Authorization

  	
  47

  
	
  Section 7.02. 

  	
  Administrative Agent and Affiliates

  	
  47

  
	
  Section 7.03. 

  	
  Action by Administrative Agent

  	
  47

  
	
  Section 7.04. 

  	
  Consultation with Experts

  	
  48

  
	
  Section 7.05. 

  	
  Liability of Administrative Agent

  	
  48

  
	
  Section 7.06. 

  	
  Indemnification

  	
  48

  
	
  Section 7.07. 

  	
  Credit Decision

  	
  48

  
	
  Section 7.08. 

  	
  Successor Administrative Agent

  	
  49

  
	
  Section 7.09. 

  	
  Administrative Agent’s Fee

  	
  49

  
	
  Section 7.10. 

  	
  Other Agents

  	
  49

  
				

 

 ii
 

 

	
  

  	
   

  	
   

  
	
  Article
  8

  
	
  CHANGE
  IN CIRCUMSTANCES

  
	
   

  	
   

  	
   

  
	
  Section 8.01. 

  	
  Basis for Determining Interest Rate Inadequate or
  Unfair

  	
  49

  
	
  Section 8.02. 

  	
  Illegality

  	
  50

  
	
  Section 8.03. 

  	
  Increased Cost and Reduced Return

  	
  51

  
	
  Section 8.04. 

  	
  Taxes

  	
  52

  
	
  Section 8.05. 

  	
  Base Rate Loans Substituted for Affected
  Euro-Dollar Loans

  	
  54

  
	
  Section 8.06. 

  	
  Substitution of Bank; Termination Option

  	
  55

  
	
   

  	
   

  	
   

  
	
  Article
  9

  
	
  MISCELLANEOUS

  
	
   

  	
   

  	
   

  
	
  Section 9.01.

  	
  Notices

  	
  56

  
	
  Section 9.02.

  	
  No Waivers

  	
  57

  
	
  Section 9.03. 

  	
  Expenses; Indemnification

  	
  57

  
	
  Section 9.04. 

  	
  Sharing of Set-offs

  	
  57

  
	
  Section 9.05. 

  	
  Amendments and Waivers

  	
  58

  
	
  Section 9.06. 

  	
  Successors and Assigns

  	
  58

  
	
  Section 9.07. 

  	
  Collateral

  	
  60

  
	
  Section 9.08. 

  	
  Confidentiality

  	
  60

  
	
  Section 9.09. 

  	
  Governing Law; Submission to Jurisdiction

  	
  61

  
	
  Section 9.10. 

  	
  Counterparts; Integration

  	
  61

  
	
  Section 9.11. 

  	
  WAIVER OF JURY TRIAL

  	
  61

  
	
  Section 9.12. 

  	
  USA Patriot Act

  	
  61

  
	
   

  	
   

  	
   

  
	
  COMMITMENT SCHEDULE

  	
   

  	
   

  
	
  PRICING SCHEDULE

  	
   

  	
   

  
	
  SCHEDULE 1.01 –   EXISTING LETTERS OF
  CREDIT

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  EXHIBIT A –

  	
   

  	
  Note

  
	
  EXHIBIT B-1 –

  	
   

  	
  Opinion of Internal Counsel of the Borrower

  
	
  EXHIBIT B-2 –

  	
   

  	
  Opinion of Special Counsel for the Borrower

  
	
  EXHIBIT C –

  	
   

  	
  Opinion of Davis Polk & Wardwell, Special
  Counsel for the Agents

  
	
  EXHIBIT D –

  	
   

  	
  Assignment and Assumption Agreement

  
	
  EXHIBIT E –

  	
   

  	
  Extension Agreement

  
	
  EXHIBIT F –

  	
   

  	
  Notice of Issuance

  
	
  EXHIBIT G -

  	
   

  	
  Approved Form of Letter of Credit

  
					

 

 iii

AMENDED AND RESTATED
CREDIT AGREEMENT

AGREEMENT
dated as of June 28, 2007 among DUKE ENERGY CORPORATION, DUKE ENERGY CAROLINAS,
LLC, DUKE ENERGY OHIO, INC., DUKE ENERGY INDIANA, INC. and DUKE ENERGY
KENTUCKY, INC., as Borrowers, the BANKS listed on the signature pages hereof,
WACHOVIA BANK, NATIONAL ASSOCIATION, as Administrative Agent, and JPMORGAN
CHASE BANK, NATIONAL ASSOCIATION, BARCLAYS BANK PLC, BANK OF AMERICA, N.A. and
CITIBANK, N.A., as Co-Syndication Agents, and THE BANK OF TOKYO-MITSUBISHI, LTD.,
New York Branch and CREDIT SUISSE, as Co-Documentation Agents.

W I T N E S S E T H:

WHEREAS,
certain of the parties hereto are parties to one or more of the Existing
Agreements (as this and other capitalized terms are defined in Section 1.01 of
this Agreement); and

WHEREAS,
the parties hereto wish to consolidate the credit facilities under the Existing
Agreements into a single multi-borrower credit facility, and in connection
therewith to modify certain terms and conditions of the Existing Agreements,
all as more fully set forth herein;

NOW,
THEREFORE, the parties hereto hereby agree that, on and as of the Effective
Date, the Existing Agreements are hereby amended and restated in their entirety
as follows:

ARTICLE 1

DEFINITIONS

Section
1.01. 
Definitions.  The
following terms, as used herein, have the following meanings:

“Additional Bank” means any financial
institution that becomes a Bank for purposes hereof pursuant to Section 2.17 or
8.06.

“Administrative Agent” means Wachovia in its
capacity as administrative agent for the Banks hereunder, and its successors in
such capacity.

“Administrative
Questionnaire” means, with respect to each Bank, the
administrative questionnaire in the form submitted to such Bank by the
Administrative Agent and submitted to the Administrative Agent (with a copy to
each Borrower) duly completed by such Bank.

“Affiliate” means, as to any Person (the “specified Person”) (i) any Person that
directly, or indirectly through one or more intermediaries, controls the 

specified Person (a “Controlling
Person”) or (ii) any Person (other than the specified Person or a
Subsidiary of the specified Person) which is controlled by or is under common
control with a Controlling Person.  As
used herein, the term “control”
means possession, directly or indirectly, of the power to direct or cause the
direction of the management or policies of a Person, whether through the
ownership of voting securities, by contract or otherwise.

“Agent” means any of the Administrative Agent, the
Co-Syndication Agents or the Co-Documentation Agents.

“Aggregate Exposure” means, with respect to any Bank at any
time, the aggregate amount of its Borrower Exposures to all Borrowers at such
time.

“Agreement” means this Agreement
as the same may be amended from time to time.

“Applicable Lending Office” means, with
respect to any Bank, (i) in the case of its Base Rate Loans, its Domestic
Lending Office and (ii) in the case of its Euro-Dollar Loans, its Euro-Dollar
Lending Office.

“Applicable Margin” means, with respect to
Euro-Dollar Loans or Swingline Loans to any Borrower, the applicable rate per
annum for such Borrower determined in accordance with the Pricing Schedule.

“Appropriate Share” has the meaning set forth in Section
8.03(d).

“Approved Fund” means any Fund that is administered
or managed by (i) a Bank, (ii) an Affiliate of a Bank or (iii) an entity or an
Affiliate of an entity that administers or manages a Bank.

“Approved Officer” means the president, the
chief financial officer, a vice president, the treasurer, an assistant
treasurer or the controller of the Borrower or such other representative of the
Borrower as may be designated by any one of the foregoing with the consent of
the Administrative Agent.

“Assignee” has the meaning set forth in
Section 9.06(c).

“Availability Percentage” means, with respect to each
Borrower at any time, the percentage which such Borrower’s Sublimit bears to
the aggregate amount of the Commitments, all determined as of such time.

“Bank” means each bank or other financial
institution listed on the signature pages hereof, each Additional Bank, each
Assignee which becomes a Bank pursuant to Section 9.06(c), and their respective
successors.  Each reference herein to a “Bank”
shall, unless the context otherwise requires, include the Swingline Bank and
each Issuing Bank in such capacity.

 2
 

“Barclays” means Barclays Bank PLC.

“Base Rate” means, for any day for which the same is to be
calculated, the higher of (a) the Prime Rate and (b) the Federal Funds Rate for
such day plus 1/2 of 1%.  Each change in
the Base Rate shall take effect simultaneously with the corresponding change in
the rates described in clause (a) or clause (b) above, as the case may be.

“Base Rate Loan” means (i) a Loan which
bears interest at the Base Rate pursuant to the applicable Notice of Borrowing
or Notice of Interest Rate Election or the provisions of Article 8 or (ii) an
overdue amount which was a Base Rate Loan immediately before it became overdue.

“Borrower” means each of Duke Energy Carolinas, Duke Energy
Ohio, Duke Energy Indiana, Duke Energy Kentucky and the Company.  References herein to “the Borrower” in
connection with any Loan or Group of Loans or any Letter of Credit hereunder
are to the particular Borrower to which such Loan or Loans are made or proposed
to be made or at whose request and for whose account such Letter of Credit is
issued or proposed to be issued.

“Borrower Exposure” means, with respect to any Bank and any
Borrower at any time, (i) an amount equal to the product of such Bank’s
Percentage and such Borrower’s Sublimit (whether used or unused) at such time
or (ii) if such Bank’s Commitment shall have terminated, either generally or
with respect to such Borrower, or if such Borrower’s Sublimit shall have been
reduced to zero, the sum of the aggregate outstanding principal amount of its
Loans (other than Swingline Loans) to such Borrower, the aggregate amount of
its Letter of Credit Liabilities in respect of such Borrower and the amount of
its Swingline Exposure in respect of such Borrower at such time.

“Borrower Maturity Date” means, with respect to any Revolving
Credit Loan to any Borrower other than the Company, the first anniversary of
the date of the Borrowing of such Revolving Credit Loan; provided
that if the Borrower designates such Borrowing as long-term in its Notice of
Borrowing, then the Borrower Maturity Date shall not be applicable thereto.

“Borrowing” has the meaning set forth in
Section 1.03.

“CG&E First Mortgage Trust Indenture” means the first
mortgage trust indenture, dated as of August 1, 1936, between Duke Energy Ohio
and The Bank of New York (successor to Irving Trust Company), as trustee, as
amended, modified or supplemented from time to time, and any successor or
replacement mortgage trust indenture.

“Cinergy” means Cinergy Corp., a Delaware corporation.

 3
 

“Co-Documentation Agent” means each of The Bank of
Tokyo-Mitsubishi, Ltd., New York Branch and Credit Suisse, in its capacity as
documentation agent in respect of this Agreement.

“Commitment” means (i) with respect to any Bank listed on the
signature pages hereof, the amount set forth opposite its name on the
Commitment Schedule as its Commitment and (ii) with respect to each Additional
Bank or Assignee which becomes a bank pursuant to Sections 2.17, 8.06 and
9.06(c), the amount of the Commitment thereby assumed by it, in each case as
such amount may from time to time be reduced pursuant to Sections 2.08, 2.10,
8.06 or 9.06(c) or increased pursuant to Sections 2.17, 8.06 or  9.06(c).

“Commitment Schedule” means the Commitment Schedule attached
hereto.

“Commitment Termination Date” means, for
each Bank, June 28, 2012, as such date may be extended from time to time with
respect to such Bank pursuant to Section 2.01(c) or, if such day is not a Euro-Dollar
Business Day, the next preceding Euro-Dollar Business Day.

“Company” means Duke Energy Corporation, a Delaware
corporation.

“Consolidated Capitalization” means, with respect to any
Borrower, the sum, without duplication, of (i) Consolidated Indebtedness of
such Borrower, (ii) consolidated common equityholders’ equity as would appear
on a consolidated balance sheet of such Borrower and its Consolidated
Subsidiaries prepared in accordance with generally accepted accounting
principles, (iii) the aggregate liquidation preference of preferred or priority
equity interests (other than preferred or priority equity interests subject to
mandatory redemption or repurchase) of such Borrower and its Consolidated
Subsidiaries upon involuntary liquidation, (iv) the aggregate outstanding
amount of all Equity Preferred Securities of such Borrower and (v) minority
interests as would appear on a consolidated balance sheet of such Borrower and
its Consolidated Subsidiaries prepared in accordance with generally accepted
accounting principles.

“Consolidated Indebtedness” means, at any date, with respect
to any Borrower, all Indebtedness of such Borrower and its Consolidated
Subsidiaries determined on a consolidated basis in accordance with generally
accepted accounting principles; provided that
Consolidated Indebtedness shall exclude, to the extent otherwise reflected
therein, Equity Preferred Securities of such Borrower and its Consolidated
Subsidiaries up to a maximum excluded amount equal to 15% of Consolidated
Capitalization of such Borrower.

“Consolidated Subsidiary” means, for any
Person, at any date any Subsidiary or other entity the accounts of which would
be consolidated with those

 4
 

of such Person in its consolidated financial
statements if such statements were prepared as of such date.

“Co-Syndication Agent” means each of JPMCB, Barclays, Bank of
America, N.A. and Citibank, N.A., in its capacity as syndication agent in
respect of this Agreement.

“Default” means any condition or event which
constitutes an Event of Default or which with the giving of notice or lapse of
time or both would, unless cured or waived, become an Event of Default.

“Departing Bank” means any Person which has a commitment to
extend credit under an Existing Agreement but does not have a Commitment under
this Agreement.

“Domestic Business Day” means any day except
a Saturday, Sunday or other day on which commercial banks in New York City or
in the State of North Carolina are authorized by law to close.

“Domestic Lending Office” means, as to each
Bank, its office located at its address set forth in its Administrative
Questionnaire (or identified in its Administrative Questionnaire as its
Domestic Lending Office) or such other office as such Bank may hereafter
designate as its Domestic Lending Office by notice to the Borrowers and the
Administrative Agent.

“Duke Capital” means Duke Capital, LLC, a former Subsidiary
of the Company.

“Duke Energy Carolinas” means
Duke Energy Carolinas, LLC, a North Carolina limited liability company (f/k/a
Duke Power Company, LLC).

“Duke Energy Carolinas Mortgage” means the First and
Refunding Mortgage between Duke Energy Carolinas and JPMCB, as successor
trustee, dated as of December 1, 1927 as amended or supplemented from time to
time.

“Duke Energy Indiana” means Duke Energy Indiana, Inc., an
Indiana corporation (f/k/a PSI Energy, Inc.).

“Duke Energy Kentucky” means Duke Energy Kentucky, Inc., a
Kentucky corporation (f/k/a The Union Light, Heat & Power Company).

“Duke Energy Ohio” means Duke Energy Ohio, Inc., an Ohio
corporation (f/k/a The Cincinnati Gas & Electric Company).

“Effective Date” means the date this
Agreement becomes effective in accordance with Section 3.01.

 5
 

“Endowment” means the Duke Endowment, a
charitable common law trust established by James B. Duke by Indenture dated
December 11, 1924.

“Environmental Laws” means any and all
federal, state, local and foreign statutes, laws, regulations, ordinances,
rules, judgments, orders, decrees, permits, concessions, grants, franchises,
licenses, agreements or other governmental restrictions relating to the environment
or to emissions, discharges, releases of pollutants, contaminants, chemicals,
or industrial, toxic or hazardous substances or wastes into the environment
including, without limitation, ambient air, surface water, ground water, or
land, or otherwise relating to the manufacture, processing, distribution, use,
treatment, storage, disposal, transport, or handling of pollutants,
contaminants, chemicals, or industrial, toxic or hazardous substances or
wastes.

“Equity Preferred Securities” means, with respect to any
Borrower, any trust preferred securities or deferrable interest subordinated
debt securities issued by such Borrower or any Subsidiary or other financing
vehicle of such Borrower that (i) have an original maturity of at least twenty
years and (ii) require no repayments or prepayments and no mandatory
redemptions or repurchases, in each case, prior to the first anniversary of the
latest Commitment Termination Date.

“ERISA” means the Employee Retirement Income
Security Act of 1974, as amended.

“ERISA Group” means, with respect to any
Borrower, such Borrower and all other members of a controlled group of
corporations and all trades or businesses (whether or not incorporated) under
common control which, together with such Borrower, are treated as a single
employer under Section 414 of the Internal Revenue Code.

“Euro-Dollar Business Day” means any
Domestic Business Day on which commercial banks are open for international
business (including dealings in dollar deposits) in London.

“Euro-Dollar Lending Office” means, as
to each Bank, its office, branch or affiliate located at its address set forth
in its Administrative Questionnaire (or identified in its Administrative
Questionnaire as its Euro-Dollar Lending Office) or such other office,
branch or affiliate of such Bank as it may hereafter designate as its Euro-Dollar
Lending Office by notice to the Borrowers and the Administrative Agent.

“Euro-Dollar Loan” means (i) a Loan
which bears interest at a Euro-Dollar Rate pursuant to the applicable Notice of
Borrowing or Notice of Interest Rate Election or (ii) an overdue amount which
was a Euro-Dollar Loan immediately before it became overdue.

 6
 

“Euro-Dollar Rate” means a rate of interest
determined pursuant to Section 2.06(b) on the basis of a London Interbank Offered
Rate.

“Euro-Dollar Reference Banks” means the
principal London offices of JPMCB and Wachovia.

“Euro-Dollar Reserve Percentage” has
the meaning set forth in Section 2.15.

“Event of Default” has the meaning set forth
in Section 6.01.

“Existing Agreements” shall mean (a) the
$400,000,000 Credit Agreement dated as of December 7, 2006, among the Company,
the banks listed therein and Wachovia, as administrative agent, (b) the
$1,500,000,000 Amended and Restated Credit Agreement dated as of June 29, 2006,
among Cinergy, Duke Energy Ohio, Duke Energy Indiana, Duke Energy Kentucky, the
banks listed therein and Barclays Bank PLC, as administrative agent, (c) the
$600,000,000 Amended and Restated Credit Agreement dated as of June 29, 2006,
among Duke Energy Carolinas, the banks listed therein and Citibank, N.A., as
administrative agent, (d) the $75,000,000 Amended and Restated Credit
Agreement, dated as of September 11, 2006, between Duke Energy Carolinas and
Merrill Lynch Bank USA and (e) the $75,000,000 Credit Agreement, dated as of
September 11, 2006, among Duke Energy Carolinas, the banks listed therein and
Credit Suisse, Cayman Islands Branch, as administrative agent, in each case as
amended and in effect on the Effective Date.

“Existing Letters of Credit” means the letters of credit set
forth in Schedule 1.01.

“Facility Fee Rate” means, with respect to
any Borrower, the applicable rate per annum for such Borrower determined in
accordance with the Pricing Schedule.

“Federal Funds
Rate” means, for any day, the rate per annum (rounded
upwards, if necessary, to the nearest 1/100th of 1%) equal to the weighted
average of the rates on overnight Federal funds transactions with members of
the Federal Reserve System arranged by Federal funds brokers on such day, as published
by the Federal Reserve Bank of New York on the Domestic Business Day next
succeeding such day; provided
that (i) if such day is not a Domestic Business Day, the Federal Funds Rate for
such day shall be such rate on such transactions on the next preceding Domestic
Business Day as so published on the next succeeding Domestic Business Day and
(ii) if no such rate is so published on such next succeeding Domestic Business
Day, the Federal Funds Rate for such day shall be the average rate quoted to
Wachovia on such day on such transactions as determined by the Administrative
Agent.

 7
 

“Final Maturity Date” means, for each Bank,
the first anniversary of its Commitment Termination Date or, if such day is not
a Euro-Dollar Business Day, the next preceding Euro-Dollar Business Day.

“Fund” means any Person (other than a
natural Person) that is (or will be) engaged in making, purchasing, holding or
otherwise investing in commercial loans and similar extensions of credit in the
ordinary course of its business.

“Group of Loans” means at any time a group
of Loans consisting of (i) all Loans to the same Borrower which are Base Rate
Loans at such time or (ii) all Euro-Dollar Loans to the same Borrower having
the same Interest Period at such time;
provided that, if a Loan of any particular Bank is converted to or
made as a Base Rate Loan pursuant to Article 8, such Loan shall be included in
the same Group or Groups of Loans from time to time as it would have been if it
had not been so converted or made.

“Hedging Agreement” means for any Person, any and all
agreements, devices or arrangements designed to protect such Person or any of
its Subsidiaries from the fluctuations of interest rates, exchange rates
applicable to such party’s assets, liabilities or exchange transactions,
including, but not limited to, dollar-denominated or cross-currency interest
rate exchange agreements, forward currency exchange agreements, interest rate
cap or collar protection agreements, commodity swap agreements, forward rate
currency or interest rate options, puts and warrants.  Notwithstanding anything herein to the
contrary, “Hedging Agreements” shall also include fixed-for-floating interest
rate swap agreements and similar instruments.

“Increased Commitments” has the
meaning set forth in Section 2.17.

“Indebtedness” of any Person means at any
date, without duplication, (i) all obligations of such Person for borrowed
money, (ii) all indebtedness of such Person for the deferred purchase price of
property or services purchased (excluding current accounts payable incurred in
the ordinary course of business), (iii) all indebtedness created or arising
under any conditional sale or other title retention agreement with respect to
property acquired, (iv) all indebtedness under leases which shall have been or
should be, in accordance with generally accepted accounting principles,
recorded as capital leases in respect of which such Person is liable as lessee,
(v) the face amount of all outstanding letters of credit issued for the account
of such Person (other than letters of credit relating to indebtedness included
in Indebtedness of such Person pursuant to another clause of this definition)
and, without duplication, the unreimbursed amount of all drafts drawn
thereunder, (vi) indebtedness secured by any Lien on property or assets of such
Person, whether or not assumed (but in any event not exceeding the fair market
value of the property or asset), (vii) all direct guarantees of Indebtedness
referred to above of another Person, (viii) all amounts payable in connection
with 

 8
 

mandatory redemptions or repurchases of preferred
stock or member interests or other preferred or priority equity interests and
(ix) any obligations of such Person (in the nature of principal or interest) in
respect of acceptances or similar obligations issued or created for the account
of such Person.

“Initial Sublimit” means, with respect to each Borrower, the
amount set forth opposite its name in the table below:

	
  Borrower

  	
   

  	
  Initial Sublimit

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Company

  	
   

  	
  $

  	
  850,000,000

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Duke Energy
  Carolinas

  	
   

  	
  $

  	
  800,000,000

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Duke Energy Ohio

  	
   

  	
  $

  	
  500,000,000

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Duke Energy
  Indiana

  	
   

  	
  $

  	
  400,000,000

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Duke Energy Kentucky

  	
   

  	
  $

  	
  100,000,000

  	
   

  

 

“Interest Period” means, with respect to
each Euro-Dollar Loan, the period commencing on the date of borrowing specified
in the applicable Notice of Borrowing or on the date specified in an applicable
Notice of Interest Rate Election and ending one, two, three or six, or, if
deposits of a corresponding maturity are generally available in the London
interbank market, nine or twelve, months thereafter, as the Borrower may elect
in such notice; provided that:

(a)       any Interest Period which would otherwise
end on a day which is not a Euro-Dollar Business Day shall be extended to
the next succeeding Euro-Dollar Business Day unless such Euro-Dollar
Business Day falls in another calendar month, in which case such Interest
Period shall end on the next preceding Euro-Dollar Business Day; and

(b)      any Interest Period which begins on the
last Euro-Dollar Business Day of a calendar month (or on a day for which
there is no numerically corresponding day in the calendar month at the end of
such Interest Period) shall end on the last Euro-Dollar Business Day of a
calendar month;

provided
further that:  (x) no Interest Period applicable to any Loan
of any Bank which begins before such Bank’s Commitment Termination Date may end
after such Bank’s Commitment Termination Date; and (y) no Interest Period
applicable to any Loan of any Bank may end after such Bank’s Final Maturity
Date.

“Internal Revenue Code” means the Internal
Revenue Code of 1986, as amended, or any successor statute.

 9
 

“Investment Grade Status” exists as to any
Person at any date if all senior long-term unsecured debt securities of such
Person outstanding at such date which had been rated by S&P or Moody’s are
rated BBB- or higher by S&P or Baa3
or higher by Moody’s, as the case may be, or if such Person does not have a
rating of its long-term unsecured debt securities, then if the corporate credit
rating of such Person, if any exists, from S&P is BBB- or higher or the issuer rating of such Person, if any exists, from
Moody’s is Baa3 or higher.

“Issuing Bank” means (i) each of JPMCB and
Wachovia, (ii) Barclays, with respect to any Existing Letter of Credit issued
by it and (iii) any other Bank that may agree to issue letters of credit
hereunder, in each case as issuer of a Letter of Credit hereunder.  No Issuing Bank shall be obligated to issue
any Letter of Credit hereunder if, after giving effect thereto, the aggregate
Letter of Credit Liabilities in respect of all Letters of Credit issued by such
Issuing Bank hereunder would exceed (i) in the case of Wachovia, $1,000,000,000
(as such amount may be modified from time to time by agreement between the
Company and Wachovia), (ii) in the case of JPMCB, $500,000,000 (as such amount
may be modified from time to time by agreement between the Company and such
Issuing Bank) or (iii) with respect to any other Issuing Bank, such amount (if
any) as may be agreed for this purpose from time to time by such Issuing Bank
and the Company.  For avoidance of doubt,
the limitations in the preceding sentence are for the exclusive benefit of the
respective Issuing Banks, are incremental to the other limitations specified
herein on the availability of Letters of Credit and do not affect such other
limitations.

“JPMCB” means JPMorgan Chase Bank, National Association.

“Letter of Credit” means a letter of credit
issued or to be issued hereunder by an Issuing Bank in accordance with Section
2.15, including the Existing Letters of Credit.

“Letter of Credit Liabilities” means, for
any Bank and at any time, such Bank’s ratable participation in the sum of (x)
the amounts then owing by all Borrowers in respect of amounts drawn under
Letters of Credit and (y) the aggregate amount then available for drawing under
all Letters of Credit.

“LIBOR Market Index Rate” means, for any day, the rate for
one month U.S. dollar deposits as reported on page “3750” of the Telerate
Service (or such other page as may replace the 3750 page of that service or if
the Telerate Service shall cease displaying such rates, such other service or
services as may be nominated by the British Bankers’ Association for the
purpose of displaying London interbank offered rates for U.S. dollar deposits),
determined as of 11:00 a.m. London time, for such day; or if such day is not a
Euro-Dollar Business Day, for the immediately preceding Euro-Dollar Business
Day (or if not so reported,

 

 10

then
as determined by the Administrative Agent from another recognized source or
interbank quotation.)

“Lien” means, with respect to any asset, any
mortgage, lien, pledge, charge, security interest or encumbrance of any kind in
respect of such asset.  For the purposes
of this Agreement, any Borrower or any of its Subsidiaries shall be deemed to
own subject to a Lien any asset which it has acquired or holds subject to the
interest of a vendor or lessor under any conditional sale agreement, capital
lease or other title retention agreement relating to such asset.

“Loan” means a Revolving Credit Loan, a Term Loan or a
Swingline Loan; provided that Swingline Loans
shall be subject to only those provisions of Article 2 which are specifically
made applicable to Swingline Loans.

“London Interbank Offered Rate” has the
meaning set forth in Section 2.06(b).

“Material Debt” means, with respect to any
Borrower, Indebtedness of such Borrower or any of its Material Subsidiaries in
an aggregate principal amount exceeding $150,000,000.

“Material Plan” has the meaning set forth in
Section 6.01(i).

“Material Subsidiary” means at any time, with respect to any
Borrower, any Subsidiary of such Borrower that is a “significant subsidiary”
(as such term is defined on the Effective Date in Regulation S-X of the
Securities and Exchange Commission (17 CFR 210.1-02(w)), but treating all
references therein to the “registrant” as references to such Borrower).

“Maximum Sublimit” means, with respect to each Borrower, the
amount set forth opposite its name in the table below:

	
  Borrower

  	
   

  	
  Maximum Sublimit

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Company

  	
   

  	
  $

  	
  1,200,000,000

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Duke Energy Carolinas

  	
   

  	
  $

  	
  1,200,000,000

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Duke Energy Ohio

  	
   

  	
  $

  	
  750,000,000

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Duke Energy Indiana

  	
   

  	
  $

  	
  600,000,000

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Duke Energy Kentucky

  	
   

  	
  $

  	
  150,000,000

  	
   

  

“Moody’s”
means Moody’s Investors Service, Inc.

“Mortgage Indenture” means, in the case of each of Duke
Energy Carolinas, Duke Energy Ohio, Duke Energy Indiana and Duke Energy
Kentucky, 

 11
 

the Duke Energy Carolinas Mortgage, the CG&E First
Mortgage Trust Indenture, PSI Energy First Mortgage Trust Indenture or
ULH&P First Mortgage Trust Indenture, respectively.

“Notes” means promissory notes of a
Borrower, in the form required by Section 2.04, evidencing the obligation of such
Borrower to repay the Loans made to it, and “Note”
means any one of such promissory notes issued hereunder.

“Notice of Borrowing” has the meaning set forth in Section
2.02.

“Notice of Interest Rate Election” has the
meaning set forth in Section 2.09(b)

“Notice of Issuance” has the meaning set
forth in Section 2.15(b).

“Parent” means, with respect to any Bank,
any Person controlling such Bank.

“Participant” has the meaning set forth in
Section 9.06(b).

“PBGC” means the Pension Benefit Guaranty
Corporation or any entity succeeding to any or all of its functions under
ERISA.

“Percentage” means, with respect to any Bank at any time, the
percentage which the amount of its Commitment at such time represents of the
aggregate amount of all the Commitments at such time.

“Person” means an individual, a corporation,
a partnership, an association, a trust or any other entity or organization,
including a government or political subdivision or an agency or instrumentality
thereof.

“Plan” means at any time an employee pension
benefit plan which is covered by Title IV of ERISA or subject to the minimum
funding standards under Section 412 of the Internal Revenue Code and is either
(i) maintained by a member of the ERISA Group for employees of a member of the
ERISA Group or (ii) maintained pursuant to a collective bargaining agreement or
any other arrangement under which more than one employer makes contributions
and to which a member of the ERISA Group is then making or accruing an
obligation to make contributions or has within the preceding five plan years
made contributions.

“Pricing Schedule” means the Pricing
Schedule attached hereto.

“Prime Rate” means the per annum rate of interest established
from time to time by the Administrative Agent at its principal office in Charlotte,
North Carolina as its Prime Rate.  Any
change in the interest rate resulting from a

 12
 

change in the Prime Rate shall become effective as of
12:01 a.m. of the Domestic Business Day on which each change in the Prime Rate
is announced by the Administrative Agent. 
The Prime Rate is a reference rate used by the Administrative Agent in
determining interest rates on certain loans and is not intended to be the
lowest rate of interest charged on any extension of credit to any debtor.

“PSI Energy First Mortgage Trust Indenture” means the first
mortgage trust indenture, dated as of September 1, 1939, between Duke Energy
Indiana and LaSalle Bank National Association (formerly known as LaSalle
National Bank Company and successor, as trustee, to First National Bank of
Chicago), as trustee, as amended, modified or supplemented from time to time,
and any successor or replacement mortgage trust indenture.

“Quarterly Payment Date” means the first
Domestic Business Day of each January, April, July and October.

“Regulation U” means Regulation U of the
Board of Governors of the Federal Reserve System, as in effect from time to
time.

“Reimbursement Obligation” means, at any
time, the obligation of the Borrower then outstanding under Section 2.15 to
reimburse the Issuing Bank for amounts paid by the Issuing Bank in respect of
any one or more drawings under a Letter of Credit.

“Removed Borrower” has the meaning set forth in Section
9.05(b)

“Required Banks” means, at any time, Banks having at least
51% in aggregate amount of the Aggregate Exposures at such time.

“Revolving Credit Loan” means a loan made or
to be made by a Bank pursuant to Section 2.01(a); provided that, if any such loan or loans (or portions
thereof) are combined or subdivided pursuant to a Notice of Interest Rate
Election, the term “Revolving Credit Loan” shall refer to the combined
principal amount resulting from such combination or to each of the separate
principal amounts resulting from such subdivision, as the case may be.

“Revolving Credit Period”  means,
with respect to any Bank, the period from and including the Effective Date to
but not including its Commitment Termination Date.

“S&P” means Standard & Poor’s Rating
Services, a division of The McGraw-Hill Companies, Inc.

“Subsidiary” means, as to any Person, any
corporation or other entity of which securities or other ownership interests
having ordinary voting power to 

 13
 

elect a majority of the board of directors or other
persons performing similar functions are at the time directly or indirectly
owned by such Person; unless otherwise specified, “Subsidiary” means a
Subsidiary of a Borrower.

“Substantial Assets” means, with respect to
any Borrower, assets sold or otherwise disposed of in a single transaction or a
series of related transactions representing 25% or more of the consolidated
assets of such Borrower and its Consolidated Subsidiaries, taken as a whole.

“Sublimit” means, with respect to each Borrower, its Initial
Sublimit, as the same may be modified from time to time pursuant to Sections
2.08 and 2.17; provided that a Borrower’s
Sublimit shall at no time exceed such Borrower’s Maximum Sublimit.

“Swingline Bank” means Wachovia, in its capacity as the
Swingline Bank under the swing loan facility described in Section 2.18.

“Swingline Exposure” means, with respect to any Bank, an
amount equal to such Bank’s Percentage of the aggregate outstanding principal
amount of Swingline Loans.

 “Swingline Loan”
means a loan made or to be made by the Swingline Bank pursuant to Section 2.18.

“Swingline Termination Date” 
means the tenth Domestic Business Day prior to Wachovia’s Commitment
Termination Date.

“Term Loan” means a loan made or to be made
by a Bank pursuant to Section 2.01(b); provided
that, if any such loan or loans (or portions thereof) are combined or subdivided
pursuant to a Notice of Interest Rate Election, the term “Term Loan” shall
refer to the combined principal amount resulting from such combination or to
each of the separate principal amounts resulting from such subdivision, as the
case may be.

“Trust” means The Doris Duke Trust, a trust
established by James B. Duke by Indenture dated December 11, 1924 for the
benefit of certain relatives.

“ULH&P First Mortgage Trust Indenture” means the first
mortgage trust indenture, dated as of February 1, 1949, between Duke Energy
Kentucky and The Bank of New York (successor to Irving Trust Company), as
trustee, as amended, modified or supplemented from time to time, and any
successor or replacement mortgage trust indenture.

“Unfunded Vested Liabilities” means, with
respect to any Plan at any time, the amount (if any) by which (i) the present
value of all benefits under such Plan exceeds (ii) the fair market value of all
Plan assets allocable to such benefits, 

 14
 

all determined as of the then most recent valuation date
for such Plan, but only to the extent that such excess represents a potential
liability of a member of the ERISA Group to the PBGC or the Plan under Title IV
of ERISA.

“United States” means the United States of
America, including the States and the District of Columbia, but excluding its
territories and possessions.

“Utilization Limits” means the requirements that (i) for any
Bank, the aggregate outstanding principal amount of its Loans (other than
Swingline Loans) to all Borrowers hereunder plus the aggregate amount of its
Letter of Credit Liabilities plus its Swingline Exposure shall at no time
exceed the amount of its Commitment and (ii) for any Borrower, the aggregate
outstanding principal amount of Loans to such Borrower plus the aggregate
amount of Letter of Credit Liabilities in respect of Letters of Credit issued
for its account shall at no time exceed its Sublimit.

“Wachovia” means Wachovia Bank, National Association.

Section
1.02.  Accounting
Terms and Determinations.  Unless
otherwise specified herein, all accounting terms used herein shall be
interpreted, all accounting determinations hereunder shall be made, and all
financial statements required to be delivered hereunder shall be prepared in
accordance with generally accepted accounting principles as in effect from time
to time, applied on a basis consistent (except for changes concurred in by the
relevant Borrower’s independent public accountants) with the most recent
audited consolidated financial statements of such Borrower and its Consolidated
Subsidiaries delivered to the Banks.

Section
1.03.  Types of
Borrowings.  The term “Borrowing” denotes the aggregation of Loans
of one or more Banks to be made to a single Borrower pursuant to Article 2 on a
single date and for a single Interest Period. 
Borrowings are classified for purposes of this Agreement by reference to
the pricing of Loans comprising such Borrowing (e.g., a “Euro-Dollar
Borrowing” is a Borrowing comprised of Euro Dollar Loans).

ARTICLE 2

THE CREDITS

Section
2.01. 
Commitments to Lend.  (a)   Revolving Credit Loans.  During its Revolving Credit Period, each Bank
severally agrees, on the terms and conditions set forth in this Agreement, to
make loans to each Borrower pursuant to this subsection from time to time; provided that, immediately after each such loan is made, the
Utilization Limits are not exceeded. 
Each Borrowing under this subsection shall be in an aggregate principal
amount of $10,000,000 or any larger 

 15
 

multiple of $1,000,000 (except that any such Borrowing
may be in the aggregate amount available in accordance with Section 3.02(b))
and shall be made from the several Banks ratably in proportion to their
respective Commitments in effect on the date of Borrowing; provided that, if the Interest Period
selected by the Borrower for a Borrowing would otherwise end after the
Commitment Termination Dates of some but not all Banks, the Borrower may in its
Notice of Borrowing elect not to borrow from those Banks whose Commitment
Termination Dates fall prior to the end of such Interest Period.  Within the foregoing limits, the Borrowers
may borrow under this subsection (a), or to the extent permitted by Section
2.11, prepay Loans and reborrow at any time during the Revolving Credit Periods
under this subsection (a).

(b)        Term
Loans.  Each Bank severally
agrees, on the terms and conditions set forth in this Agreement, to make a loan
to each Borrower on its Commitment Termination Date; provided
that, immediately after each such loan is made, the Utilization Limits are not
exceeded; and provided  further that no Bank shall be obligated to make a loan
pursuant to this subsection if any Commitment shall have been extended pursuant
to Section 2.01(c) to a date later than the Commitment Termination Date of such
Bank.  Each Borrowing under this Section
2.01(b) shall be made from the several Banks having the same Commitment
Termination Date ratably in proportion to their respective Commitments.

(c)        Extension
of Commitments.  (i) The
Company may, upon notice to the Administrative Agent not less than 60 days but
no more than 90 days prior to any anniversary of the Effective Date, propose to
extend the Commitment Termination Dates for an additional one-year period
measured from the Commitment Termination Dates then in effect.  The Administrative Agent shall promptly
notify the Banks of receipt of such request. 
Each Bank shall endeavor to respond to such request, whether
affirmatively or negatively (such determination in the sole discretion of such
Bank), by notice to the Company and the Administrative Agent within 30
days.  Subject to the execution by the
Borrowers, the Administrative Agent and such Banks of a duly completed
Extension Agreement in substantially the form of Exhibit E, the Commitment
Termination Date applicable to the Commitment of each Bank so affirmatively
notifying the Company and the Administrative Agent shall be extended for the
period specified above; provided
that no Commitment Termination Date of any Bank shall be extended unless Banks
having Commitments in an aggregate amount equal to at least 51% in aggregate
amount of the Commitments in effect at the time any such extension is requested
shall have elected so to extend their Commitments.

(ii)           Any
Bank which does not give such notice to the Company and the Administrative
Agent shall be deemed to have elected not to extend as requested, and the
Commitment of each non-extending Bank shall terminate on its 

 16
 

Commitment
Termination Date determined without giving effect to such requested
extension.  The Company may, in
accordance with Section 8.06, designate another bank or other financial
institution (which may be, but need not be, an extending Bank) to replace a
non-extending Bank.  On the date of
termination of any Bank’s Commitment as contemplated by this paragraph, the
respective participations of the other Banks in all outstanding Letters of
Credit and Swingline Loans shall be redetermined on the basis of their
respective Commitments after giving effect to such termination, and the
participation therein of the Bank whose Commitment is terminated shall
terminate; provided that the Borrowers shall, if
and to the extent necessary to permit such redetermination of participations in
Letters of Credit and Swingline Loans within the limits of the Commitments
which are not terminated, prepay on such date all or a portion of the
outstanding Revolving Credit Loans, and such redetermination and termination of
participations in outstanding Letters of Credit and Swingline Loans shall be
conditioned upon their having done so.

Section
2.02.  Notice of
Borrowings.  The Borrower
shall give the Administrative Agent notice (a “Notice of Borrowing”) not later than 11:00 A.M. (Eastern time)
on (x) the date of each Base Rate Borrowing and (y) the third Euro-Dollar
Business Day before each Euro-Dollar Borrowing, specifying:

(a)        the date of such Borrowing, which shall
be a Domestic Business Day in the case of a Domestic Borrowing or a Euro-Dollar
Business Day in the case of a Euro-Dollar Borrowing;

(b)        the aggregate amount of such Borrowing;

(c)        whether the Loans comprising such
Borrowing are to bear interest initially at the Base Rate or a Euro-Dollar
Rate;

(d)        in the case of a Euro-Dollar Borrowing,
the duration of the initial Interest Period applicable thereto, subject to the
provisions of the definition of Interest Period; and

(e)        if applicable, the designation
contemplated by the definition of Borrower Maturity Date.

Unless the Borrower shall have given notice to
Administrative Agent not later than 11:00 A.M. (Eastern time) on the date on
which any payment of  a Reimbursement
Obligation is due to an Issuing Bank or on the scheduled date of maturity of a
Swingline Loan to the effect that the Borrower will make such payment with
funds from another source, the Borrower shall be deemed to have given a Notice
of Borrowing for a Base Rate Borrowing on such date in the minimum amount
permitted by Section 2.01 that equals or exceeds the amount of such
Reimbursement Obligation or Swingline Loan.

 17
 

Section
2.03.  Notice to
Banks; Funding of Loans.  (a)  Upon receipt (or deemed
receipt) of a Notice of Borrowing, the Administrative Agent shall promptly
notify each Bank of the contents thereof and of such Bank’s share (if any) of
such Borrowing and such Notice of Borrowing shall not thereafter be revocable
by the Borrower.

(b)        Not later than 1:00 P.M. (Eastern time)
on the date of each Borrowing, each Bank participating therein shall (except as
provided in subsection (c) of this Section) make available its share of such
Borrowing, in Federal or other immediately available funds, to the
Administrative Agent at its address specified in or pursuant to Section
9.01.  Unless the Administrative Agent
determines that any applicable condition specified in Article 3 has not been
satisfied, the Administrative Agent will make the funds so received from the
Banks available to the Borrower at the Administrative Agent’s aforesaid
address; provided that to the extent that all or
a portion of such Borrowing is to be applied to a Reimbursement Obligation or a
Swingline Loan of the Borrower as contemplated by Sections 2.02 and 2.18(b),
the Administrative Agent shall distribute to the applicable Issuing Bank or the
Swingline Bank, as the case may be, the appropriate portion of such funds.

(c)        Unless the Administrative Agent shall
have received notice from a Bank prior to 1:00 P.M. (Eastern time) on the date
of any Borrowing that such Bank will not make available to the Administrative
Agent such Bank’s share of such Borrowing, the Administrative Agent may assume
that such Bank has made such share available to the Administrative Agent on the
date of such Borrowing in accordance with subsection (b) of this Section 2.03
and the Administrative Agent may, in reliance upon such assumption, make
available to the Borrower on such date a corresponding amount.  If and to the extent that such Bank shall not
have so made such share available to the Administrative Agent, such Bank and,
if such Bank shall not have made such payment within two Domestic Business Days
of demand therefor, the Borrower severally agree to repay to the Administrative
Agent forthwith on demand such corresponding amount together with interest
thereon, for each day from the date such amount is made available to the
Borrower until the date such amount is repaid to the Administrative Agent, at (i)
in the case of the Borrower, a rate per annum equal to the higher of the
Federal Funds Rate and the interest rate applicable thereto pursuant to Section
2.06 and (ii) in the case of such Bank, the Federal Funds Rate.  If such Bank shall repay to the Administrative
Agent such corresponding amount, such amount so repaid shall constitute such
Bank’s Loan included in such Borrowing for purposes of this Agreement.

(d)        The failure of any Bank to make the Loan
to be made by it as part of any Borrowing shall not relieve any other Bank of
its obligation, if any, hereunder to make a Loan on the date of such Borrowing,
but no Bank shall be responsible for the failure of any other Bank to make a
Loan to be made by such other Bank.

 18
 

Section
2.04.  Registry;
Notes.  (a)  The Administrative Agent shall maintain a register (the “Register”) on which it will record the
Commitment of each Bank, each Loan made by such Bank and each repayment of any
Loan made by such Bank.  Any such
recordation by the Administrative Agent on the Register shall be conclusive,
absent manifest error.  Failure to make
any such recordation, or any error in such recordation, shall not affect the
Borrowers’ obligations hereunder.

(b)        Each Borrower hereby agrees that,
promptly upon the request of any Bank at any time, such Borrower shall deliver
to such Bank a duly executed Note, in substantially the form of Exhibit A
hereto, payable to the order of such Bank and representing the obligation of
such Borrower to pay the unpaid principal amount of the Loans made to such
Borrower by such Bank, with interest as provided herein on the unpaid principal
amount from time to time outstanding.

(c)        Each Bank shall record the date, amount
and maturity of each Loan (including Swingline Loans) made by it and the date and
amount of each payment of principal made by the Borrower with respect thereto,
and each Bank receiving a Note pursuant to this Section, if such Bank so elects
in connection with any transfer or enforcement of its Note, may endorse on the
schedule forming a part thereof appropriate notations to evidence the foregoing
information with respect to each such Loan then outstanding; provided that the failure of such Bank to
make any such recordation or endorsement shall not affect the obligations of
any Borrower hereunder or under the Notes. 
Such Bank is hereby irrevocably authorized by each Borrower so to
endorse its Note and to attach to and make a part of its Note a continuation of
any such schedule as and when required.

Section
2.05.  Maturity
of Loans; Effect of Cash Collateralization of Letters of Credit.  (a)  Each Revolving Credit Loan made by
any Bank shall mature, and the principal amount thereof shall be due and
payable together with accrued interest thereon, on the earlier of the
Commitment Termination Date of such Bank and the applicable Borrower Maturity
Date (if any).

(b)        Each Term Loan of each Bank shall
mature, and the principal amount thereof shall be due and payable, together
with accrued interest thereon, on the Final Maturity Date of such Bank.

Section
2.06.  Interest
Rates. (a) Each Base Rate Loan shall bear interest on the
outstanding principal amount thereof, for each day from the date such Loan is
made until it becomes due, at a rate per annum equal to the Base Rate for such
day.  Such interest shall be payable
quarterly in arrears on each Quarterly Payment Date, at maturity and on the
date of termination of the Commitments in their entirety.  Any overdue principal of or overdue interest
on any Base Rate Loan shall bear interest, payable on demand, for each day
until paid at a rate per annum equal to the sum of 1% plus the Base Rate for
such day.

 19
 

(b)        Each Euro-Dollar Loan shall bear
interest on the outstanding principal amount thereof, for each day during each
Interest Period applicable thereto, at a rate per annum equal to the sum of the
Applicable Margin for such day plus the London Interbank Offered Rate
applicable to such Interest Period. Such interest shall be payable for each
Interest Period on the last day thereof and, if such Interest Period is longer
than three months, at intervals of three months after the first day thereof.

The
“London Interbank Offered Rate”
applicable to any Interest Period means the rate appearing on Page 3750 of the
Telerate Service Company (or on any successor or substitute page of such
service, or any successor to or substitute for such service, providing rate
quotations comparable to those currently provided on such page of the Telerate
Service, as may be nominated by the British Bankers’ Association for purposes
of providing quotations of interest rates applicable to U.S. dollar deposits in
the London interbank market) as of 11:00 A.M. (London time) two Euro-Dollar
Business Days prior to the commencement of such Interest Period, as the rate
for U.S. dollar deposits with a maturity comparable to such Interest
Period.  In the event that such rate is
not so available at such time for any reason, then the “London Interbank Offered Rate” for such
Interest Period shall be the average (rounded upward, if necessary, to the next
higher 1/16 of 1%) of the respective rates per annum at which deposits in U.S.
dollars are offered to each of the Euro-Dollar Reference Banks in the London
interbank market at approximately 11:00 A.M. (London time) two Euro-Dollar
Business Days before the first day of such Interest Period in an amount
approximately equal to the principal amount of the Loan of such Euro-Dollar
Reference Bank to which such Interest Period is to apply and for a period of
time comparable to such Interest Period. 
If any Euro-Dollar Reference Bank does not furnish a timely quotation,
the Administrative Agent shall determine the relevant interest rate on the
basis of the quotation furnished by the remaining Euro-Dollar Reference Bank
or, if none of such quotations is available on a timely basis, the provisions
of Section 8.01 shall apply.

(c)           Any overdue principal of or overdue
interest on any Euro-Dollar Loan shall bear interest, payable on demand,
for each day from and including the date payment thereof was due to but excluding
the date of actual payment, at a rate per annum equal to the sum of 1% plus the
higher of (i) the sum of the Applicable Margin for such day plus the London
Interbank Offered Rate applicable to such Loan at the date such payment was due
and (ii) the Base Rate for such day.

(d)           The
Administrative Agent shall determine each interest rate applicable to the Loans
hereunder.  The Administrative Agent
shall give prompt notice to the Borrower and the participating Banks by
telecopy, telex or cable of each rate of interest so determined, and its
determination thereof shall be

 20
 

conclusive
in the absence of manifest error unless the Borrower raises an objection
thereto within five Domestic Business Days after receipt of such notice.

Section
2.07.  Fees.  (a)  Facility
Fees.  Each Borrower shall pay
to the Administrative Agent, for the account of the Banks ratably in proportion
to their related Borrower Exposures, a facility fee calculated for each day at
the Facility Fee Rate for such day (determined in accordance with the Pricing
Schedule) on the aggregate amount of the related Borrower Exposures on such
day.  Such facility fee shall accrue for
each day from and including the Effective Date but excluding the day on which
the related Borrower Exposures are reduced to zero.

(b)        Letter
of Credit Fees.  The Borrower
shall pay to the Administrative Agent (i) for the account of the Banks ratably
a letter of credit fee accruing daily on the aggregate amount then available
for drawing under all outstanding Letters of Credit at a rate per annum equal
to the then applicable Applicable Margin and (ii) for the account of each
Issuing Bank a letter of credit fronting fee accruing daily on the aggregate
amount then available for drawing under all Letters of Credit issued by such
Issuing Bank at a rate per annum of 0.10% (or such other rate as may be
mutually agreed from time to time by the Borrower and such Issuing Bank).

(c)        Payments.  Accrued fees under this Section for the
account of any Bank shall be payable quarterly in arrears on each Quarterly
Payment Date and upon such Bank’s Commitment Termination Date and Final
Maturity Date (and, if later, the date the Borrower Exposure of such Bank in
respect of any Borrower is reduced to zero).

Section
2.08.  Optional
Termination or Reduction of Sublimits; Changes to Sublimits.  (a)  The
Company may, upon not less than three Domestic Business Days’ notice to the
Administrative Agent, reallocate amounts of the Commitments among the
respective Sublimits of the Borrowers (i.e., reduce the
Sublimits of one or more Borrowers and increase the Sublimits of one or more
other Borrowers by the same aggregate amount); provided
(i) each Sublimit shall be a multiple of $5,000,000 at all times, (ii) a
Borrower’s Sublimit may not be reduced to an amount less than the sum of the
aggregate outstanding principal amount of Loans to such Borrower plus the
aggregate amount of Letter of Credit Liabilities in respect of Letters of
Credit issued for its account, (iii) a Borrower’s Sublimit may not be increased
to an amount greater than its Maximum Sublimit, (iv) the sum of the Sublimits
of the respective Borrowers shall at all times equal the aggregate amount of
the Commitments and (v) any such increase in a Borrower’s Sublimit shall be
accompanied or preceded by evidence reasonably satisfactory to the
Administrative Agent as to appropriate corporate authorization therefor.

 

 21

(b)      Each
Borrower other than the Company may, upon at least three Domestic Business Days’
notice to the Administrative Agent, reduce its Sublimit (i) to zero, if no
Loans to it or Letter of Credit Liabilities for its account are outstanding or
(ii) by an amount of $5,000,000 or any larger multiple of $5,000,000 so long
as, after giving effect to such reduction, its Sublimit is not less than the
sum of the aggregate principal amount of Loans outstanding to it and the
aggregate Letter of Credit Liabilities outstanding for its account.  Upon any reduction in the Sublimit of a
Borrower to zero pursuant to this Section 2.08(b), such Borrower shall cease to
be a Borrower hereunder.  The aggregate
amount of the Commitments will be automatically and simultaneously reduced by
the amount of each reduction in any Sublimit pursuant to this Section 2.08(b)
or pursuant to Section 6.01.

Section
2.09.  Method of
Electing Interest Rates.  (a)  The Loans included
in each Borrowing shall bear interest initially at the type of rate specified
by the Borrower in the applicable Notice of Borrowing. Thereafter, the Borrower
may from time to time elect to change or continue the type of interest rate
borne by each Group of Loans (subject in each case to the provisions of Article
8 and the last sentence of this subsection (a)), as follows:

(i)          if such Loans are Base Rate Loans, the
Borrower may elect to convert such Loans to Euro-Dollar Loans as of any
Euro-Dollar Business Day; and

(ii)         if such Loans are Euro-Dollar
Loans, the Borrower may elect to convert such Loans to Base Rate Loans or elect
to continue such Loans as Euro-Dollar Loans for an additional Interest
Period, subject to Section 2.13 in the case of any such conversion or
continuation effective on any day other than the last day of the then current
Interest Period applicable to such Loans.

Each such election shall
be made by delivering a notice (a “Notice of
Interest Rate Election”) to the Administrative Agent not later than
11:00 A.M. (Eastern time) on the third Euro-Dollar Business Day before
the conversion or continuation selected in such notice is to be effective.  A Notice of Interest Rate Election may, if it
so specifies, apply to only a portion of the aggregate principal amount of the
relevant Group of Loans; provided
that (i) such portion is allocated ratably among the Loans comprising such
Group and (ii) the portion to which such notice applies, and the remaining
portion to which it does not apply, are each $10,000,000 or any larger multiple
of $1,000,000.

(b)      Each
Notice of Interest Rate Election shall specify:

(i)          the Group of Loans (or portion
thereof) to which such notice applies;

 22
 

(ii)         the date on which the conversion or
continuation selected in such notice is to be effective, which shall comply
with the applicable clause of subsection 2.09(a) above;

(iii)        if the Loans comprising such Group are
to be converted, the new type of Loans and, if the Loans being converted are to
be Euro-Dollar Loans, the duration of the next succeeding Interest Period
applicable thereto; and

(iv)       if such Loans are to be continued as Euro-Dollar
Loans for an additional Interest Period, the duration of such additional
Interest Period.

Each Interest Period
specified in a Notice of Interest Rate Election shall comply with the
provisions of the definition of the term “Interest
Period”.

(c)            Promptly
after receiving a Notice of Interest Rate Election from the Borrower pursuant
to subsection 2.09(a) above, the Administrative Agent shall notify each Bank of
the contents thereof and such notice shall not thereafter be revocable by the
Borrower. If no Notice of Interest Rate Election is timely received prior to
the end of an Interest Period for any Group of Loans, the Borrower shall be
deemed to have elected that such Group of Loans be converted to Base Rate Loans
as of the last day of such Interest Period.

(d)           An
election by the Borrower to change or continue the rate of interest applicable
to any Group of Loans pursuant to this Section shall not constitute a “Borrowing” subject to the provisions of
Section 3.02.

Section
2.10.  Mandatory
Termination of Commitments.  The
Commitment of each Bank shall terminate on such Bank’s Commitment Termination
Date.

Section
2.11.  Optional
Prepayments.  (a)  The Borrower may (i)
upon notice to the Administrative Agent not later than 11:00 A.M. (Eastern
time) on any Domestic Business Day prepay on such Domestic Business Day any
Group of Base Rate Loans and (ii) upon at least three Euro-Dollar
Business Days’ notice to the Administrative Agent not later than 11:00 A.M.
(Eastern time) prepay any Group of Euro-Dollar Loans, in each case in
whole at any time, or from time to time in part in amounts aggregating
$5,000,000 or any larger multiple of $1,000,000, by paying the principal amount
to be prepaid together with accrued interest thereon to the date of prepayment
and together with any additional amounts payable pursuant to Section 2.13. Each
such optional prepayment shall be applied to prepay ratably the Loans of the
several Banks included in such Group or Borrowing.

 23
 

(b)           Upon
receipt of a notice of prepayment pursuant to this Section, the Administrative
Agent shall promptly notify each Bank of the contents thereof and of such Bank’s
share (if any) of such prepayment and such notice shall not thereafter be
revocable by the Borrower.

Section
2.12.  General
Provisions as to Payments.  (a)  The Borrower shall
make each payment of principal of, and interest on, the Loans and of fees
hereunder, not later than 1:00 P.M. (Eastern time) on the date when due, in
Federal or other funds immediately available in New York City, to the
Administrative Agent at its address referred to in Section 9.01 and without
reduction by reason of any set-off, counterclaim or deduction of any kind.  The Administrative Agent will promptly
distribute to each Bank in like funds its ratable share of each such payment
received by the Administrative Agent for the account of the Banks.  Whenever any payment of principal of, or
interest on, the Base Rate Loans, Swingline Loans or Letter of Credit
Liabilities or of fees shall be due on a day which is not a Domestic Business
Day, the date for payment thereof shall be extended to the next succeeding
Domestic Business Day.  Whenever any
payment of principal of, or interest on, the Euro-Dollar Loans shall be
due on a day which is not a Euro-Dollar Business Day, the date for
payment thereof shall be extended to the next succeeding Euro-Dollar
Business Day unless such Euro-Dollar Business Day falls in another
calendar month, in which case the date for payment thereof shall be the next
preceding Euro-Dollar Business Day. 
If the date for any payment of principal is extended by operation of law
or otherwise, interest thereon shall be payable for such extended time.

(b)           Unless
the Administrative Agent shall have received notice from the Borrower prior to
the date on which any payment is due to the Banks hereunder that the Borrower
will not make such payment in full, the Administrative Agent may assume that
the Borrower has made such payment in full to the Administrative Agent on such
date and the Administrative Agent may, in reliance upon such assumption, cause
to be distributed to each Bank on such due date an amount equal to the amount
then due such Bank.  If and to the extent
that the Borrower shall not have so made such payment, each Bank shall repay to
the Administrative Agent forthwith on demand such amount distributed to such
Bank together with interest thereon, for each day from the date such amount is
distributed to such Bank until the date such Bank repays such amount to the
Administrative Agent, at the Federal Funds Rate.

Section
2.13.  Funding
Losses.  If the Borrower makes
any payment of principal with respect to any Euro-Dollar Loan or any
Euro-Dollar Loan is converted to a Base Rate Loan or continued as a Euro-Dollar
Loan for a new Interest Period (pursuant to Article 2, 6 or 8 or otherwise) on
any day other than the last day of an Interest Period applicable thereto, or if
the Borrower fails to borrow, prepay, convert or continue any Euro-Dollar Loans
after notice has been given to any Bank in accordance with Section 2.03(a),
2.09(c) or 2.11(b), the 

 24
 

Borrower shall reimburse each Bank within 15 days
after demand for any resulting loss or expense incurred by it (or by an
existing or prospective Participant in the related Loan), including (without
limitation) any loss incurred in obtaining, liquidating or employing deposits
from third parties, but excluding loss of margin for the period after any such
payment or conversion or failure to borrow, prepay, convert or continue; provided that such Bank shall have
delivered to the Borrower a certificate setting forth in reasonable detail the
calculation of the amount of such loss or expense, which certificate shall be
conclusive in the absence of manifest error.

Section
2.14.  Computation
of Interest and Fees.  Interest
based on the Base Rate or the LIBOR Market Index Rate and facility fees
hereunder shall be computed on the basis of a year of 365 days (or 366 days in
a leap year) and paid for the actual number of days elapsed (including the
first day but excluding the last day). All other interest and Letter of Credit
fees shall be computed on the basis of a year of 360 days and paid for the
actual number of days elapsed (including the first day but excluding the last
day).

Section
2.15.  Letters of
Credit.

(a)            Subject
to the terms and conditions hereof, each Issuing Bank agrees to issue Letters
of Credit hereunder from time to time before its Commitment Termination Date
upon the request and for the account of any Borrower; provided
that, immediately after each Letter of Credit is issued, (i) the Utilization
Limits shall not be exceeded and (ii) the aggregate amount of the Letter of
Credit Liabilities shall not exceed $1,000,000,000.  Upon the date of issuance by the Issuing Bank
of a Letter of Credit, the Issuing Bank shall be deemed, without further action
by any party hereto, to have sold to each Bank, and each Bank shall be deemed,
without further action by any party hereto, to have purchased from the Issuing
Bank, a participation to the extent of its Percentage in such Letter of Credit
and the related Letter of Credit Liabilities.

(b)           The
Borrower shall give the Issuing Bank notice at least three Domestic Business
Days prior to the requested issuance of a Letter of Credit, or in the case of a
Letter of Credit substantially in the form of Exhibit G, at least one Business
Day prior to the requested issuance of such Letter of Credit, specifying the
date such Letter of Credit is to be issued and describing the terms of such
Letter of Credit (such notice, including any such notice given in connection
with the extension of a Letter of Credit, a “Notice
of Issuance”), substantially in the form of Exhibit F, appropriately
completed. Upon receipt of a Notice of Issuance, the Issuing Bank shall
promptly notify the Administrative Agent, and the Administrative Agent shall
promptly notify each Bank of the contents thereof and of the amount of such
Bank’s participation in such Letter of Credit. The issuance by the Issuing Bank
of each Letter of Credit shall, in addition to the conditions precedent set
forth in Article 3, be subject to the conditions precedent that such 

 25
 

Letter
of Credit shall be denominated in U.S. dollars and shall be in such form and
contain such terms as shall be reasonably satisfactory to the Issuing Bank.
Unless otherwise notified by the Administrative Agent, the Issuing Bank may,
but shall not be required to, conclusively presume that all conditions
precedent set forth in Article 3 have been satisfied. The Borrower shall also
pay to each Issuing Bank for its own account issuance, drawing, amendment and
extension charges in the amounts and at the times as agreed between the
Borrower and such Issuing Bank.  Except
for non-substantive amendments to any Letter of Credit for the purpose of
correcting errors or ambiguities or to allow for administrative convenience
(which amendments each Issuing Bank may make in its discretion with the consent
of the Borrower), the amendment, extension or renewal of any Letter of Credit
shall be deemed to be an issuance of such Letter of Credit.  If any Letter
of Credit contains a provision pursuant to which it is deemed to be
automatically renewed unless notice of termination is given by the Issuing Bank
of such Letter of Credit, the Issuing Bank shall timely give notice of
termination if (i) as of close of business on the seventeenth day prior to the
last day upon which the Issuing Bank’s notice of termination may be given to
the beneficiaries of such Letter of Credit, the Issuing Bank has received a
notice of termination from the Borrower or a notice from the Administrative
Agent that the conditions to issuance of such Letter of Credit have not been
satisfied or (ii) the renewed Letter of Credit would have a term not permitted
by subsection (c) below.

(c)            No
Letter of Credit shall have a term extending beyond the first anniversary of
the Commitment Termination Date of the applicable Issuing Bank.

(d)           Upon
receipt from the beneficiary of any applicable Letter of Credit of any notice
of a drawing under such Letter of Credit, the Issuing Bank shall notify the
Administrative Agent and the Administrative Agent shall promptly notify the
Borrower and each other Bank as to the amount to be paid as a result of such
demand or drawing and the payment date. The Borrower shall be irrevocably and
unconditionally obligated forthwith to reimburse the Issuing Bank for any
amounts paid by the Issuing Bank upon any drawing under any Letter of Credit
without presentment, demand, protest or other formalities of any kind. All such
amounts paid by the Issuing Bank and remaining unpaid by the Borrower shall
bear interest, payable on demand, for each day until paid at a rate per annum
equal to the Base Rate for such day plus, if such amount remains unpaid for
more than two Domestic Business Days, 1%. 
In addition, each Bank will pay to the Administrative Agent, for the
account of the applicable Issuing Bank, immediately upon such Issuing Bank’s
demand at any time during the period commencing after such drawing until
reimbursement therefor in full by the Borrower, an amount equal to such Bank’s
ratable share of such drawing (in proportion to its participation therein),
together with interest on such amount for each day from the date of the Issuing
Bank’s demand for such payment (or, if such demand is made after 12:00 Noon
(Eastern time) on such date, from the next 

 26
 

succeeding
Domestic Business Day) to the date of payment by such Bank of such amount at a
rate of interest per annum equal to the Federal Funds Rate and, if such amount
remains unpaid for more than five Domestic Business Days after the Issuing Bank’s
demand for such payment, at a rate of interest per annum equal to the Base Rate
plus 1%. The Issuing Bank will pay to each Bank ratably all amounts received
from the Borrower for application in payment of its reimbursement obligations
in respect of any Letter of Credit, but only to the extent such Bank has made
payment to the Issuing Bank in respect of such Letter of Credit pursuant
hereto.

(e)            The
obligations of the Borrower and each Bank under subsection 2.15(d) above shall
be absolute, unconditional and irrevocable, and shall be performed strictly in
accordance with the terms of this Agreement, under all circumstances
whatsoever, including without limitation the following circumstances:

(i)          the use which may be made of the
Letter of Credit by, or any acts or omission of, a beneficiary of a Letter of
Credit (or any Person for whom the beneficiary may be acting);

(ii)         the existence of any claim, set-off,
defense or other rights that the Borrower may have at any time against a
beneficiary of a Letter of Credit (or any Person for whom the beneficiary may
be acting), the Banks (including the Issuing Bank) or any other Person, whether
in connection with this Agreement or the Letter of Credit or any document
related hereto or thereto or any unrelated transaction;

(iii)        any statement or any other document
presented under a Letter of Credit proving to be forged, fraudulent or invalid
in any respect or any statement therein being untrue or inaccurate in any
respect whatsoever;

(iv)       payment under a Letter of Credit to the
beneficiary of such Letter of Credit against presentation to the Issuing Bank
of a draft or certificate that does not comply with the terms of the Letter of
Credit; provided that the
determination by the Issuing Bank to make such payment shall not have been the
result of its willful misconduct or gross negligence; or

(v)        any other act or omission to act or
delay of any kind by any Bank (including the Issuing Bank), the Administrative
Agent or any other Person or any other event or circumstance whatsoever that
might, but for the provisions of this subsection (v), constitute a legal or
equitable discharge of the Borrower’s or the Bank’s obligations hereunder.

 27
 

(f)            The
Borrower hereby indemnifies and holds harmless each Bank (including the Issuing
Bank) and the Administrative Agent from and against any and all claims,
damages, losses, liabilities, costs or expenses which such Bank or the
Administrative Agent may incur (including, without limitation, any claims,
damages, losses, liabilities, costs or expenses which the Issuing Bank may
incur by reason of or in connection with (i) the failure of any other Bank to
fulfill or comply with its obligations to such Issuing Bank hereunder (but
nothing herein contained shall affect any rights the Borrower may have against
such defaulting Bank) or (ii) any litigation arising with respect to this
Agreement (whether or not the Issuing Bank shall prevail in such litigation)),
and none of the Banks (including the Issuing Bank) nor the Administrative Agent
nor any of their officers or directors or employees or agents shall be liable
or responsible, by reason of or in connection with the execution and delivery
or transfer of or payment or failure to pay under any Letter of Credit,
including without limitation any of the circumstances enumerated in subsection
2.15(e) above, as well as (i) any error, omission, interruption or delay in
transmission or delivery of any messages, by mail, cable, telegraph, telex or
otherwise, (ii) any loss or delay in the transmission of any document required
in order to make a drawing under a Letter of Credit and (iii) any consequences
arising from causes beyond the control of the Issuing Bank, including, without
limitation, any government acts or any other circumstances whatsoever, in
making or failing to make payment under such Letter of Credit; provided that the Borrower shall not be
required to indemnify the Issuing Bank for any claims, damages, losses,
liabilities, costs or expenses, and the Borrower shall have a claim for direct
(but not consequential) damage suffered by it, to the extent found by a court
of competent jurisdiction to have been caused by (x) the willful misconduct or
gross negligence of the Issuing Bank in determining whether a request presented
under any Letter of Credit complied with the terms of such Letter of Credit or
(y) the Issuing Bank’s failure to pay under any Letter of Credit after the
presentation to it of a request strictly complying with the terms and
conditions of the Letter of Credit. Nothing in this subsection 2.15(f) is
intended to limit the obligations of the Borrower under any other provision of
this Agreement. To the extent the Borrower does not indemnify the Issuing Bank
as required by this subsection, the Banks agree to do so ratably in accordance
with their Commitments.

(g)           The
Issuing Bank shall act on behalf of the Banks with respect to any Letters of
Credit issued by it and the documents associated therewith, and the Issuing Bank
shall have all of the benefits and immunities (i) provided to the
Administrative Agent in Article 7 (other than Sections 7.08 and 7.09) with
respect to any acts taken or omissions suffered by the Issuing Bank in
connection with Letters of Credit issued by it or proposed to be issued by it
and the applications and agreements for letters of credit pertaining to such
Letters of Credit as fully as if the term “Administrative Agent” as used in
Article 7 included the Issuing Bank

 28
 

with
respect to such acts or omissions and (ii) as additionally provided herein
with respect to the Issuing Bank.

(h)           On
the Effective Date, each Issuing Bank that has issued an Existing Letter of
Credit shall be deemed, without further action by any party hereto, to have
granted to each Bank, and each Bank shall be deemed, without further action by
any party hereto, to have acquired from the Issuing Bank, a participation in
such Existing Letter of Credit and the related Letter of Credit Liabilities in
the proportion its respective Commitment bears to the aggregate
Commitments.  On and after the Effective
Date, each Existing Letter of Credit shall constitute a Letter of Credit for
all purposes hereof.

Section
2.16.  Regulation
D Compensation.  In the event
that a Bank is required to maintain reserves of the type contemplated by the
definition of “Euro-Dollar Reserve Percentage”, such Bank
may require the Borrower to pay, contemporaneously with each payment of
interest on the Euro-Dollar Loans, additional interest on the related
Euro-Dollar Loan of such Bank at a rate per annum determined by such Bank
up to but not exceeding the excess of (i) (A) the applicable London Interbank
Offered Rate divided by (B) one minus
the Euro-Dollar Reserve Percentage over (ii) the applicable London
Interbank Offered Rate. Any Bank wishing to require payment of such additional
interest (x) shall so notify the Borrower and the Administrative Agent, in
which case such additional interest on the Euro-Dollar Loans of such Bank
shall be payable to such Bank at the place indicated in such notice with
respect to each Interest Period commencing at least three Euro-Dollar
Business Days after the giving of such notice and (y) shall notify the Borrower
at least three Euro-Dollar Business Days prior to each date on which
interest is payable on the Euro-Dollar Loans of the amount then due it
under this Section. Each such notification shall be accompanied by such
information as the Borrower may reasonably request.

“Euro-Dollar Reserve Percentage” means for any day that
percentage (expressed as a decimal) which is in effect on such day, as
prescribed by the Board of Governors of the Federal Reserve System (or any
successor) for determining the maximum reserve requirement for a member bank of
the Federal Reserve System in New York City with deposits exceeding five
billion dollars in respect of “Eurocurrency
liabilities” (or in respect of any other category of liabilities
which includes deposits by reference to which the interest rate on Euro-Dollar
Loans is determined or any category of extensions of credit or other assets
which includes loans by a non-United States office of any Bank to United
States residents).

Section
2.17.  Increase
In Commitments; Additional Banks.  (a)
Subsequent to the Effective Date, the Company may, upon at least 30 days’
notice to the Administrative Agent (which shall promptly provide a copy of such
notice to the Banks), propose to increase the aggregate amount of the
Commitments, 

 29
 

provided that after giving effect
to any such increase, the total Commitments shall not exceed $3,900,000,000
(the amount of any such increase, the “Increased Commitments”).  Each Bank party to this Agreement at such
time shall have the right (but no obligation), for a period of 15 days
following receipt of such notice, to elect by notice to the Company and the
Administrative Agent to increase its Commitment hereunder.

(b)           If
any Bank party to this Agreement shall not elect to increase its Commitment
pursuant to subsection (a) of this Section, the Company may designate another
bank or other lenders (which may be, but need not be, one or more of the
existing Banks) which at the time agree to (i) in the case of any such lender
that is an existing Bank, increase its Commitment and (ii) in the case of any
other such lender (an “Additional Bank”),
become a party to this Agreement.  The
sum of the increases in the Commitments of the existing Banks pursuant to this
subsection (b) plus the Commitments of the Additional Banks shall not in the
aggregate exceed the unsubscribed amount of the Increased Commitments.

(c)            An
increase in the aggregate amount of the Commitments pursuant to this Section
2.17 shall become effective upon the receipt by the Administrative Agent of an
agreement in form and substance satisfactory to the Administrative Agent signed
by the Borrowers, by each Additional Bank and by each other Bank whose
Commitment is to be increased, setting forth the new Commitments of such Banks
and setting forth the agreement of each Additional Bank to become a party to
this Agreement and to be bound by all the terms and provisions hereof, together
with such evidence of appropriate corporate authorization on the part of the
Borrowers with respect to the Increased Commitments and such opinions of
counsel for the Borrowers with respect to the Increased Commitments as the
Administrative Agent may reasonably request.

Upon
any increase in the aggregate amount of the Commitments pursuant to this
Section 2.17, (i) the respective Letter of Credit Liabilities of the Banks
shall be redetermined as of the effective date of such increase and (ii) within
five Domestic Business Days, in the case of any Group of Base Rate Loans then
outstanding, and at the end of the then current Interest Period with respect
thereto, in the case of any Group of Euro-Dollar Loans then outstanding, the
Borrower shall prepay such Group of Loans in its entirety and, to the extent
the Borrower elects to do so and subject to the conditions specified in Article
3, the Borrower shall reborrow Revolving Credit Loans from the Banks in
proportion to their respective Commitments after giving effect to such
increase, until such time as all outstanding Revolving Credit Loans are held by
the Banks in such proportion.  In
connection with any increase in the aggregate amount of the Commitments
pursuant to this Section, the respective Sublimits of the Borrowers shall be
increased by an equal aggregate amount as the Company may direct by notice to
the Administrative Agent, subject to the limitations set forth in Section
2.08(a).

 

 30

 Section 2.18.  Swingline Loans.  (a)  Agreement
to Lend.  From time to time
prior to the Swingline Termination Date, subject to the terms and conditions
hereof, the Swingline Bank agrees to make Swingline Loans to each Borrower
pursuant to this subsection from time to time; provided
that, immediately after each Swingline Loan is made (i) the Utilization Limits
are not exceeded and (ii) the aggregate outstanding principal amount of all
Swingline Loans does not exceed $200,000,000. 
Each Swingline Loan shall be in a principal amount of $1,000,000 or any
larger multiple thereof.  No Swingline
Loan may be used to refinance an outstanding Swingline Loan.  Within the foregoing limits, the Borrower may
borrow under this Section 2.18, prepay Swingline Loans and reborrow at any time
prior to the Swingline Termination Date under this Section 2.18.

(b)        Swingline
Borrowing Procedure.  The
Borrower shall give the Swingline Bank notice not later than 2:00 P.M. (Eastern
time) on the date of each Swingline Loan, specifying the amount of such Loan
and the date of such borrowing, which shall be a Domestic Business Day.  Not later than 3:00 P.M. (Eastern time) on
the date of each Swingline Loan, the Swingline Bank shall, unless it determines
that any applicable condition specified in Article 3 has not been satisfied,
make available the amount of such Swingline Loan, in Federal or other
immediately available funds, to the Borrower at the Swingline Bank’s address
specified in or pursuant to Section 9.01.

(c)        Interest.  Each Swingline Loan shall bear interest on
the outstanding principal amount thereof, payable at maturity, at a rate per
annum equal to the sum of the LIBOR Market Index Rate plus the Applicable
Margin for such day (or such other rate per annum as the Swingline Bank and the
Borrower may mutually agree).  Such
interest shall be payable at the maturity of such Swingline Loan and, with
respect to the principal amount of any Swingline Loan prepaid pursuant to
subsection (d) or (e) below, upon the date of such prepayment.  Any overdue principal of or interest on any
Swingline Loan shall bear interest, payable on demand, for each day until paid
at a rate per annum equal to the sum of the Base Rate for such day plus 1%.

(d)        Maturity;
Mandatory Prepayment.  Each
Swingline Loan shall mature, and the principal amount thereof shall be due and
payable, on the earlier of the date falling ten Domestic Business Days after
such Loan is made and the Swingline Termination Date.  In addition, on the date of each Borrowing of
Revolving Credit Loans pursuant to Section 2.01, the Administrative Agent shall
apply the proceeds thereof to prepay all Swingline Loans then outstanding.

(e)        Optional
Prepayment.  The Borrower may
prepay any Swingline Loan in whole at any time, or from time to time in part in
a principal amount of $1,000,000 or any larger multiple thereof, by giving
notice of such prepayment to 

 31
 

the Swingline Bank not later than 2:00 P.M. (Eastern
time) on the date of prepayment.

(f)         Euro-Dollar Protections.  The Swingline Bank shall be entitled to the
benefits of Sections 8.03 and 8.04 with respect to the Swingline Loans, and
solely  for this purpose such Swingline
Loan shall be deemed to be a Euro-Dollar Loan having an Interest Period from
and including the date such Swingline Loan was made to but not including its
maturity date.

(g)        Payments.  All payments to any Swingline Bank under this
Section 2.09 shall be made to it at its address specified in or pursuant to
Section 9.01 in Federal or other immediately available funds, not later than
3:00 P.M. (Eastern time) on the date of payment.

(h)        Refunding
Unpaid Swingline Loans.  If
(w) any Swingline Loan is not paid in full on its maturity date and the
Swingline Bank so requests, (x) the Swingline Loans become immediately due and
payable pursuant to Article 6, (y) the Commitments terminate at a time any
Swingline Loans are outstanding, or (z) requested by the Swingline Bank by
written notice given to the Administrative Agent not later than 10:00 A.M.
(Eastern time) on any Business Day, the Administrative Agent shall, by notice
to the Banks (including the Swingline Bank, in its capacity as a Bank), require
each Bank to pay to the Administrative Agent for the account of the Swingline
Bank an amount equal to such Bank’s Commitment Percentage of the aggregate
unpaid principal amount of the Swingline Loans described in clause (w), (x),
(y) or (z) above, as the case may be. 
Such notice shall specify the date on which such payments are to be
made, which shall be the first Domestic Business Day after such notice is
given.  Not later than 3:00 P.M. (Eastern
time) on the date so specified, each Bank shall pay the amount so notified to
it to the Administrative Agent at its address specified in or pursuant to Section
9.01, in Federal or other funds immediately available in New York City.  Promptly upon receipt thereof, the
Administrative Agent shall remit such amounts to the Swingline Bank.  The amount so paid by each Bank shall
constitute a Base Rate Loan to the Borrower and shall be applied by the Swingline
Bank to repay the outstanding Swingline Loans.

(i)         Purchase
of Participations in Swingline Loans.  If at the time Loans would have otherwise
been made pursuant to Section 2.18(h), one of the events described in Section
6.01(g) or Section 6.01(h) with respect to the Borrower shall have occurred and
be continuing or the Commitments shall have terminated, each Bank shall, on the
date such Loans would have been made pursuant to the notice from the
Administrative Agent to the Banks referred to in Section 2.18(h) (the “Refunding Date”), purchase an undivided
participating interest in the relevant Swingline Loans in an amount equal to
such Bank’s Percentage of the principal amount of each such Swingline
Loan.  On the Refunding Date, each Bank
shall 

 32
 

transfer to the Administrative Agent, for the account
of the Swingline Bank, in immediately available funds, such amount.

(j)         Payments
on Participated Swingline Loans. 
Whenever, at any time after the Swingline Bank has received from any
Bank such Bank’s payment pursuant to Section 2.18(i), the Swingline Bank
receives any payment on account of the Swingline Loans in which the Banks have
purchased participations pursuant to Section 2.18(i), its receipt of such
payment will be as agent for and for the account of each such Bank and the
Swingline Bank will promptly distribute to each such Bank its ratable share of
such payment (appropriately adjusted, in the case of interest payments, to
reflect the period of time during which such Bank’s participating interest was
outstanding and funded); provided
that in the event that such payment received by the Swingline Bank is required
to be returned, each such Bank will return to the Swingline Bank any portion
thereof previously distributed to it by the Swingline Bank.

(k)        Obligations
to Refund or Purchase Participations in Swingline Loans Absolute.  Each Bank’s obligation to fund a Loan as
provided in Section 2.18(h) or to purchase a participating interest pursuant to
Section 2.18(i) shall be absolute and unconditional and shall not be affected
by any circumstance, including, without limitation, (i) any set-off,
counterclaim, recoupment, defense or other right which such Bank, any Borrower
or any other Person may have against the Swingline Bank or any other Person,
(ii) the occurrence or continuance of a Default or the termination or reduction
of any Commitments,  any adverse change
in the condition (financial or otherwise) of any Borrower or any other Person,
any breach of this Agreement by any Borrower, any other Bank or any other
Person or  any other circumstance,
happening or event whatsoever, whether or not similar to any of the foregoing.

ARTICLE 3

CONDITIONS

Section
3.01. 
Effectiveness.  This
Agreement shall become effective on the date that each of the following
conditions shall have been satisfied (or waived in accordance with Section
9.05(a)).

(a)        receipt by the Administrative Agent of
counterparts hereof signed by each of the parties hereto (or, in the case of
any party as to which an executed counterpart shall not have been received,
receipt by the Administrative Agent in form satisfactory to it of telegraphic,
telecopy, telex or other written confirmation from such party of execution of a
counterpart hereof by such party);

(b)        receipt by the Administrative Agent of
(i) an opinion of internal counsel of each Borrower, substantially in the form
of Exhibit B-1 hereto and (ii) 

 33
 

an opinion of Robinson, Bradshaw & Hinson, P.A.,
special counsel for the Borrowers, substantially in the form of Exhibit B-2
hereto, and, in each case, covering such additional matters relating to the
transactions contemplated hereby as the Required Banks may reasonably request;

(c)        receipt by the Administrative Agent of
an opinion of Davis Polk & Wardwell, special counsel for the Agents,
substantially in the form of Exhibit C hereto and covering such additional
matters relating to the transactions contemplated hereby as the Required Banks
may reasonably request;

(d)        receipt by the Administrative Agent of a
certificate signed by a Vice President, the Treasurer, an Assistant Treasurer
or the Controller of the Company, dated the Effective Date, to the effect set
forth in clauses (c) and (d) of Section 3.02;

(e)        receipt by the Administrative Agent of
all documents it may have reasonably requested prior to the date hereof
relating to the existence of the Borrowers, the corporate authority for and the
validity of this Agreement and the Notes, and any other matters relevant
hereto, all in form and substance satisfactory to the Administrative Agent;

(f)         receipt by the Administrative Agent of
evidence satisfactory to it of (i) the payment of all principal of and interest
on any funded amounts outstanding under, and of all accrued fees under, any
Existing Agreement and (ii) the written consent of Cinergy and any other Person
not a party to this Agreement whose consent is required by the terms of any
Existing Agreement for it to be validly amended and restated pursuant to this
Agreement; and

(g)        receipt by the Administrative Agent for
the account of the Banks of participation fees as heretofore mutually agreed by
the Company and the Administrative Agent;

provided
that this Agreement shall not become effective or be binding on any party
hereto unless all of the foregoing conditions are satisfied not later than July
2, 2007.  The Administrative Agent shall
promptly notify the Company and the Banks of the Effective Date, and such
notice shall be conclusive and binding on all parties hereto.

On the Effective
Date, the Existing Agreements will be automatically amended and restated in
their collective entirety to read as set forth herein.  On and after the Effective Date, the rights
and obligations of the parties hereto shall be governed by this Agreement; provided that the rights and obligations of each party
hereto with respect to the period prior to the Effective Date shall continue to
be governed by the provisions of the Existing Agreements to which it is a
party.  The commitment to extend credit
of any Person which has such a commitment 

 34
 

under an Existing
Agreement but not under this Agreement shall terminate on the Effective Date,
and all accrued fees and other amounts payable to such Person shall be due on
the Effective Date.

Section
3.02.  Borrowings
and Issuance of Letters of Credit.  The
obligation of any Bank to make a Loan on the occasion of any Borrowing by any
Borrower and the obligation of any Issuing Bank to issue (or renew or extend
the term of) any Letter of Credit at the request of any Borrower is subject to
the satisfaction of the following conditions:

(a)        receipt by the Administrative Agent of a
Notice of Borrowing as required by Section 2.02 or receipt by the Issuing Bank
of a Notice of Issuance as required by Section 2.15(b), as the case may be;

(b)        the fact that, immediately after such
Borrowing or issuance of such Letter of Credit, (i) the Utilization Limits
shall not be exceeded, (ii) in the case of an issuance of a Letter of Credit
the aggregate amount of the Letter of Credit Liabilities shall not exceed
$1,000,000,000 and (iii) in the case of a Borrowing of a Swingline Loan, the
aggregate outstanding principal amount of all Swingline Loans shall not exceed
$200,000,000;

(c)        the fact that, immediately after such
Borrowing or issuance of such Letter of Credit, no Default with respect to the
Borrower shall have occurred and be continuing; and

(d)        the fact that the representations and
warranties of the Borrower contained in this Agreement (except the
representations and warranties set forth in Sections 4.04(c) and 4.06) shall be
true on and as of the date of such Borrowing or issuance of such Letter of
Credit.

Each Borrowing and
issuance of a Letter of Credit hereunder shall be deemed to be a representation
and warranty by the Borrower on the date of such Borrowing or issuance as to
the facts specified in clauses (b), (c) and (d) of this Section.

ARTICLE 4

REPRESENTATIONS AND WARRANTIES

Each
Borrower, severally but not jointly, represents and warrants that:

Section
4.01. 
Organization and Power.  Such
Borrower is duly organized, validly existing and in good standing under the
laws of the jurisdiction of its organization and has all requisite powers and
all material governmental licenses, authorizations, consents and approvals
required to carry on its business as now conducted and is duly qualified to do
business in each jurisdiction where such 

 35
 

qualification is required, except where the failure so
to qualify would not have a material adverse effect on the business, financial
position or results of operations of such Borrower and its Consolidated
Subsidiaries, considered as a whole.

Section
4.02.  Corporate
and Governmental Authorization; No Contravention.  The execution, delivery and
performance by such Borrower of this Agreement and the Notes are within such
Borrower’s powers, have been duly authorized by all necessary company action,
require no action by or in respect of, or filing with, any governmental body,
agency or official (except for consents, authorizations or filings which have
been obtained or made, as the case may be, and are in full force and effect)
and do not contravene, or constitute a default under, any provision of
applicable law or regulation or of the articles of incorporation, by-laws,
certificate of formation or the limited liability company agreement of such
Borrower or of any agreement, judgment, injunction, order, decree or other
instrument binding upon such Borrower or result in the creation or imposition
of any Lien on any asset of such Borrower or any of its Material Subsidiaries.

Section
4.03.  Binding
Effect.  This Agreement
constitutes a valid and binding agreement of such Borrower and each Note, if
and when executed and delivered by it in accordance with this Agreement, will
constitute a valid and binding obligation of such Borrower, in each case
enforceable in accordance with its terms, except as the same may be limited by
bankruptcy, insolvency or similar laws affecting creditors’ rights generally
and by general principles of equity.

Section
4.04.  Financial
Information.  (a)  The consolidated
balance sheet of such Borrower and its Consolidated Subsidiaries as of December
31, 2006 and the related consolidated statements of income, cash flows,
capitalization and retained earnings for the fiscal year then ended, reported
on by Deloitte & Touche, copies of which have been delivered to each of the
Banks by using such Borrower’s IntraLinks site or otherwise made available,
fairly present, in conformity with generally accepted accounting principles,
the consolidated financial position of such Borrower and its Consolidated
Subsidiaries as of such date and their consolidated results of operations and
cash flows for such fiscal year.  With
respect to the Company, the preceding representation is qualified as
follows:  As disclosed in the Form 10-Q
of the Company dated May 9, 2007, for the quarter ended March 31, 2007, on
January 2, 2007, the Company completed the spin-off of Spectra Energy, which
principally consists of the Company’s former Natural Gas Transmission business
segment and the Company’s former 50% ownership interest in DCP Midstream, to
the Company’s shareholders. The results of operations of these businesses were
presented as discontinued operations for the three months ended March 31, 2006
in the consolidated statement of operations in the Form 10-Q of the Company for
the quarter ended March 31, 2007. 
However, since the spin-off did not occur until 2007, the results of
operations for these businesses were presented as continuing operations in the 

 36
 

consolidated statements of operations in the Form 10-K
of the Company for the year ended December 31, 2006.  Since the consolidated statement of
operations for the three months ended March 31, 2006 now reflects these
businesses as discontinued operations, generally accepted accounting principles
in the United States of America require the consolidated statements of
operations for the periods covered in the Form 10-K of the Company for the year
ended December 31, 2006 to be recast to reflect the results of these businesses
as discontinued operations in order to continue to be deemed in compliance with
generally accepted accounting principles as of the date of this Agreement.

(b)        The unaudited consolidated balance sheet
of such Borrower and its Consolidated Subsidiaries as of March 31, 2007 and the
related unaudited consolidated statements of income and cash flows for the
three months then ended, copies of which have been delivered to each of the
Banks by using such Borrower’s IntraLinks site or otherwise made available,
fairly present, in conformity with generally accepted accounting principles
applied on a basis consistent with the financial statements referred to in
subsection (a) of this Section, the consolidated financial position of such
Borrower and its Consolidated Subsidiaries as of such date and their
consolidated results of operations and changes in financial position for such
three-month period (subject to normal year-end adjustments and the
absence of footnotes).

(c)        Since December 31, 2006, there has been
no material adverse change in the business, financial position or results of operations
of such Borrower and its Consolidated Subsidiaries, considered as a whole,
except (in the case of the Company) to the extent the spin-off of Duke Capital
may be such a material adverse change.

Section
4.05.  Regulation
U.  Such Borrower and its Material
Subsidiaries are not engaged in the business of extending credit for the
purpose of purchasing or carrying margin stock (within the meaning of
Regulation U issued by the Board of Governors of the Federal Reserve System)
and no proceeds of any Borrowing by and no issuance of Letters of Credit for
the account of such Borrower will be used to purchase or carry any margin stock
or to extend credit to others for the purpose of purchasing or carrying any
margin stock.  Not more than 25% of the
value of the assets of such Borrower and its Material Subsidiaries is
represented by margin stock.

Section
4.06. 
Litigation.  Except as
disclosed (i) in the Borrower’s annual report on Form 10-K for the fiscal year
ended December 31, 2006 and its quarterly report on Form 10-Q for the period
ended March 31, 2007 and (ii) in the Company’s current report on Form 8-K dated
June 25, 2007, there is no action, suit or proceeding pending against, or to
the knowledge of such Borrower threatened against or affecting, such Borrower
or any of its Subsidiaries before any court or arbitrator or any governmental
body, agency or official which would 

 37
 

be likely to be decided adversely to such Borrower or
such Subsidiary and, as a result, have a material adverse effect upon the
business, consolidated financial position or results of operations of such
Borrower and its Consolidated Subsidiaries, considered as a whole, or which in
any manner draws into question the validity of this Agreement or any Note.

Section
4.07.  Compliance
with Laws.  Such Borrower and
each of its Material Subsidiaries is in compliance in all material respects
with all applicable laws, ordinances, rules, regulations and requirements of
governmental authorities (including, without limitation, ERISA and
Environmental Laws) except where (i) non-compliance would not have a material
adverse effect on the business, financial position or results of operations of
such Borrower and its Consolidated Subsidiaries, considered as a whole, or (ii)
the necessity of compliance therewith is contested in good faith by appropriate
proceedings.

Section
4.08. 
Taxes.  Such Borrower
and its Material Subsidiaries have filed all United States Federal income tax
returns and all other material tax returns which are required to be filed by
them and have paid all taxes due pursuant to such returns or pursuant to any
assessment received by such Borrower or any such Material Subsidiary except (i)
where nonpayment would not have a material adverse effect on the business,
financial position or results of operations of such Borrower and its
Consolidated Subsidiaries, considered as a whole, or (ii) where the same are
contested in good faith by appropriate proceedings.  The charges, accruals and reserves on the books
of such Borrower and its Material Subsidiaries in respect of taxes or other
governmental charges are, in the opinion of such Borrower, adequate.

ARTICLE 5

COVENANTS

Each
Borrower, severally but not jointly, agrees that, so long as any Bank has any
Commitment hereunder with respect to such Borrower or any amount payable
hereunder remains unpaid by such Borrower or any Letter of Credit Liabilities
remain outstanding:

Section
5.01. 
Information.  Such
Borrower will deliver to each of the Banks:

(a)        as soon as available and in any event
within 120 days after the end of each fiscal year of such Borrower, a
consolidated balance sheet of such Borrower and its Consolidated Subsidiaries
as of the end of such fiscal year and the related consolidated statements of
income, cash flows, capitalization and retained earnings for such fiscal year,
setting forth in each case in comparative form the figures for the previous
fiscal year, all reported on in a manner consistent 

 38
 

with past practice and with applicable requirements of
the Securities and Exchange Commission by Deloitte & Touche or other
independent public accountants of nationally recognized standing;

(b)        as soon as available and in any event
within 60 days (75 days in the case of Duke Energy Kentucky) after the end of
each of the first three quarters of each fiscal year of such Borrower, a
consolidated balance sheet of such Borrower and its Consolidated Subsidiaries
as of the end of such quarter and the related consolidated statements of income
and cash flows for such quarter and for the portion of such Borrower’s fiscal
year ended at the end of such quarter, setting forth in each case in
comparative form the figures for the corresponding quarter and the
corresponding portion of such Borrower’s previous fiscal year, all certified
(subject to normal year-end adjustments) as to fairness of presentation,
generally accepted  accounting principles
and consistency by an Approved Officer of such Borrower;

(c)        within the maximum time period specified
for the delivery of each set of financial statements referred to in clauses (a)
and (b) above, a certificate of an Approved Officer of such Borrower (i)
setting forth in reasonable detail the calculations required to establish
whether such Borrower was in compliance with the requirements of Section 5.10
on the date of such financial statements and (ii) stating whether any Default
exists on the date of such certificate and, if any Default then exists, setting
forth the details thereof and the action which such Borrower is taking or
proposes to take with respect thereto;

(d)        within five days after any officer of
such Borrower with responsibility relating thereto obtains knowledge of any
Default, if such Default is then continuing, a certificate of an Approved
Officer of such Borrower setting forth the details thereof and the action which
such Borrower is taking or proposes to take with respect thereto;

(e)        promptly upon the filing thereof, copies
of all registration statements (other than the exhibits thereto and any
registration statements on Form S-8 or its equivalent) and reports on Forms
10-K, 10-Q and 8-K (or their equivalents) which such Borrower shall have filed
with the Securities and Exchange Commission;

(f)         if and when any member of such Borrower’s
ERISA Group (i) gives or is required to give notice to the PBGC of any “reportable event” (as defined in Section
4043 of ERISA) with respect to any Material Plan which might constitute grounds
for a termination of such Plan under Title IV of ERISA, or knows that the plan
administrator of any Material Plan has given or is required to give notice of
any such reportable event, a copy of the notice of such reportable event given
or required to be given to the PBGC; (ii) receives notice of complete or
partial withdrawal liability under Title IV of ERISA or notice that any Material
Plan is in reorganization, is insolvent or has been terminated, a copy of such 

 39
 

notice; (iii) receives notice from the PBGC under
Title IV of ERISA of an intent to terminate, impose material liability (other
than for premiums under Section 4007 of ERISA) in respect of, or appoint a
trustee to administer any Plan, a copy of such notice; (iv)applies for a waiver
of the minimum funding standard under Section 412 of the Internal Revenue Code,
a copy of such application; (v) gives notice of intent to terminate any
Material Plan under Section 4041(c) of ERISA, a copy of such notice and other
information filed with the PBGC; (vi) gives notice of withdrawal from any
Material Plan pursuant to Section 4063 of ERISA, a copy of such notice; or
(vii) fails to make any payment or contribution to any Material Plan or makes
any amendment to any Material Plan which has resulted or could result in the
imposition of a Lien or the posting of a bond or other security, a certificate
of the chief financial officer or the chief accounting officer of such Borrower
setting forth details as to such occurrence and action, if any, which such
Borrower or applicable member of the ERISA Group is required or proposes to
take;

(g)        promptly, notice of any change in the
ratings of such Borrower referred to in the Pricing Schedule; and

(h)        from time to time such additional
information regarding the financial position or business of such Borrower and
its Subsidiaries as the Administrative Agent, at the request of any Bank, may
reasonably request.

Information
required to be delivered pursuant to these Sections 5.01(a), 5.01(b) and
5.01(e) shall be deemed to have been delivered on the date on which such
information has been posted on the Securities and Exchange Commission website
on the Internet at sec.gov/edaux/searches.htm, on such Borrower’s IntraLinks or
Syndtrak site or at another website identified in a notice from such Borrower
to the Banks and accessible by the Banks without charge; provided that (i) a certificate delivered
pursuant to Section 5.01(c) shall also be deemed to have been delivered upon
being posted to such Borrower’s IntraLinks or Syndtrak site and (ii) such
Borrower shall deliver paper copies of the information referred to in Sections
5.01(a), 5.01(b) and 5.01(e) to any Bank which requests such delivery.

Section
5.02.  Payment of
Taxes.  Such Borrower will pay
and discharge, and will cause each of its Material Subsidiaries to pay and
discharge, at or before maturity, all their tax liabilities, except where (i)
nonpayment would not have a material adverse effect on the business, financial
position or results of operations of such Borrower and its Consolidated
Subsidiaries, considered as a whole, or (ii) the same may be contested in good
faith by appropriate proceedings, and will maintain, and will cause each of its
Material Subsidiaries to maintain, in accordance with generally accepted
accounting principles, appropriate reserves for the accrual of any of the same.

 

 40

Section
5.03. 
Maintenance of Property; Insurance. 
(a)  Such Borrower will keep, and will
cause each of its Material Subsidiaries to keep, all property useful and
necessary in its business in good working order and condition, ordinary wear
and tear excepted.

(b)        Such Borrower will, and will cause each
of its Material Subsidiaries to, maintain (either in the name of such Borrower
or in such Subsidiary’s own name) with financially sound and responsible
insurance companies, insurance on all their respective properties in at least
such amounts and against at least such risks (and with such risk retention) as
are usually insured against by companies of established repute engaged in the
same or a similar business; provided
that self-insurance by such Borrower or any such Material Subsidiary,
shall not be deemed a violation of this covenant to the extent that companies
engaged in similar businesses and owning similar properties self-insure;
and will furnish to the Banks, upon request from the Administrative Agent, information
presented in reasonable detail as to the insurance so carried.

Section
5.04. 
Maintenance of Existence.  Such
Borrower will preserve, renew and keep in full force and effect, and will cause
each of its Material Subsidiaries to preserve, renew and keep in full force and
effect their respective corporate or other legal existence and their respective
rights, privileges and franchises material to the normal conduct of their
respective businesses; provided
that nothing in this Section 5.04 shall prohibit the termination of any right,
privilege or franchise of such Borrower or any such Material Subsidiary or of
the corporate or other legal existence of any such Material Subsidiary, or the
change in form of organization of such Borrower or any such Material
Subsidiary, if such Borrower in good faith determines that such termination or
change is in the best interest of such Borrower, is not materially
disadvantageous to the Banks and, in the case of a change in the form of
organization of such Borrower, the Administrative Agent has consented thereto.

Section
5.05.  Compliance
with Laws.  Such Borrower will
comply, and cause each of its Material Subsidiaries to comply, in all material
respects with all applicable laws, ordinances, rules, regulations, and requirements
of governmental authorities (including, without limitation, ERISA and
Environmental Laws) except where (i) noncompliance would not have a material
adverse effect on the business, financial position or results of operations of
such Borrower and its Consolidated Subsidiaries, considered as a whole, or (ii)
the necessity of compliance therewith is contested in good faith by appropriate
proceedings.

Section
5.06.  Books and
Records.  Such Borrower will
keep, and will cause each of its Material Subsidiaries to keep, proper books of
record and account in which full, true and correct entries shall be made of all
financial transactions in relation to its business and activities in accordance
with its customary practices; and will permit, and will cause each such
Material 

 41
 

Subsidiary to permit, representatives of any Bank at
such Bank’s expense (accompanied by a representative of such Borrower, if such
Borrower so desires) to visit any of their respective properties, to examine
any of their respective books and records and to discuss their respective
affairs, finances and accounts with their respective officers, employees and
independent public accountants, all upon such reasonable notice, at such
reasonable times and as often as may reasonably be desired.

Section
5.07.  Negative
Pledge.  Such Borrower will
not create, assume or suffer to exist any Lien on any asset now owned or
hereafter acquired by it, except:

(a)        Liens granted by such Borrower existing
as of the Effective Date securing Indebtedness outstanding on the date of this
Agreement in an aggregate principal amount not exceeding $100,000,000;

(b)        the Lien of such Borrower’s Mortgage
Indenture (if any) securing Indebtedness outstanding on the Effective Date or
issued hereafter;

(c)        any Lien on any asset of any Person
existing at the time such Person is merged or consolidated with or into such
Borrower and not created in contemplation of such event;

(d)        any Lien existing on any asset prior to
the acquisition thereof by such Borrower and not created in contemplation of
such acquisition;

(e)        any Lien on any asset securing
Indebtedness incurred or assumed for the purpose of financing all or any part
of the cost of acquiring such asset; provided
that such Lien attaches to such asset concurrently with or within 180 days
after the acquisition thereof;

(f)         any Lien arising out of the
refinancing, extension, renewal or refunding of any Indebtedness secured by any
Lien permitted by any of the foregoing clauses of this Section; provided that such Indebtedness is not
increased and is not secured by any additional assets;

(g)        Liens for taxes, assessments or other
governmental charges or levies not yet due or which are being contested in good
faith by appropriate proceedings and with respect to which adequate reserves or
other appropriate provisions are being maintained in accordance with generally
accepted accounting principles;

(h)        statutory Liens of landlords and Liens
of carriers, warehousemen, mechanics, materialmen and other Liens imposed by
law, created in the ordinary course of business and for amounts not past due
for more than 60 days or which are being contested in good faith by appropriate
proceedings which are sufficient 

 42
 

to prevent imminent foreclosure of such Liens, are
promptly instituted and diligently conducted and with respect to which adequate
reserves or other appropriate provisions are being maintained in accordance
with generally accepted accounting principles;

(i)         Liens incurred or deposits made in the
ordinary course of business (including, without limitation, surety bonds and
appeal bonds) in connection with workers’ compensation, unemployment insurance
and other types of social security benefits or to secure the performance of
tenders, bids, leases, contracts (other than for the repayment of Indebtedness),
statutory obligations and other similar obligations or arising as a result of
progress payments under government contracts;

(j)         easements (including, without
limitation, reciprocal easement agreements and utility agreements), rights-of-way,
covenants, consents, reservations, encroachments, variations and other
restrictions, charges or encumbrances (whether or not recorded) affecting the
use of real property;

(k)        Liens with respect to judgments and
attachments which do not result in an Event of Default;

(l)         Liens, deposits or pledges to secure
the performance of bids, tenders, contracts (other than contracts for the
payment of money), leases (permitted under the terms of this Agreement), public
or statutory obligations, surety, stay, appeal, indemnity, performance or other
obligations arising in the ordinary course of business;

(m)       other Liens including Liens imposed by
Environmental Laws arising in the ordinary course of its business which (i) do
not secure Indebtedness, (ii) do not secure any obligation in an amount
exceeding $100,000,000 at any time at which Investment Grade Status does not
exist as to such Borrower and (iii) do not in the aggregate materially detract
from the value of its assets or materially impair the use thereof in the operation
of its business;

(n)        Liens securing obligations under Hedging
Agreements entered into to protect against fluctuations in interest rates or
exchange rates or commodity prices and not for speculative purposes, provided
that such Liens run in favor of a Bank hereunder or a Person who was, at the
time of issuance, a Bank; and

(o)        Liens not otherwise permitted by the
foregoing clauses of this Section on assets of such Borrower securing
obligations in an aggregate principal or face amount at any date not to exceed
(i) in the case of each of the Company and Duke Energy Carolinas, $500,000,000
and (ii) in the case of each other Borrower, $150,000,000.

 43
 

Section
5.08. 
Consolidations, Mergers and Sales of Assets.  Such Borrower will not (i)
consolidate or merge with or into any other Person or (ii) sell, lease or
otherwise transfer, directly or indirectly, Substantial Assets to any Person
(other than a Subsidiary of such Borrower); provided
that such Borrower may merge with another Person if such Borrower is the Person
surviving such merger and, after giving effect thereto, no Default shall have
occurred and be continuing.

Section
5.09.  Use of
Proceeds.  The proceeds of the
Loans made under this Agreement will be used by such Borrower for its general
corporate purposes, including liquidity support for outstanding commercial
paper and acquisitions.  None of such
proceeds will be used, directly or indirectly, for the purpose, whether
immediate, incidental or ultimate, of buying or carrying any “margin stock” within the meaning of
Regulation U.

Section
5.10. 
Indebtedness/Capitalization Ratio. The ratio of Consolidated
Indebtedness of such Borrower to Consolidated Capitalization of such Borrower
will at no time exceed 65%.

ARTICLE 6

DEFAULTS

Section
6.01.  Events of
Default.  If one or more of
the following events (“Events of Default”)
with respect to a particular Borrower shall have occurred and be continuing:

(a)        such Borrower shall fail to pay when due
any principal of any Loan to it or any Reimbursement Obligation owed by it or
shall fail to pay, within five days of the due date thereof, any interest, fees
or any other amount payable by it hereunder;

(b)        such Borrower shall fail to observe or
perform any covenant contained in Sections 5.04, 5.07, 5.08, 5.10 or the second
sentence of 5.09, inclusive;

(c)        such Borrower shall fail to observe or
perform any covenant or agreement contained in this Agreement (other than those
covered by clause (a) or (b) above) for 30 days after notice thereof has been
given to such Borrower by the Administrative Agent at the request of any Bank;

(d)        any representation, warranty,
certification or statement made by such Borrower in this Agreement or in any
certificate, financial statement or other document delivered pursuant to this
Agreement shall prove to have been incorrect in any material respect when made
(or deemed made);

 44
 

(e)        such Borrower or any of its Material
Subsidiaries shall fail to make any payment in respect of Material Debt (other
than Loans to and Reimbursement Obligations of such Borrower hereunder) when
due or within any applicable grace period;

(f)         any event or condition shall occur and
shall continue beyond the applicable grace or cure period, if any, provided
with respect thereto so as to result in the acceleration of the maturity of
Material Debt;

(g)        such Borrower or any of its Material
Subsidiaries shall commence a voluntary case or other proceeding seeking
liquidation, reorganization or other relief with respect to itself or its debts
under any bankruptcy, insolvency or other similar law now or hereafter in
effect or seeking the appointment of a trustee, receiver, liquidator, custodian
or other similar official of it or any substantial part of its property, or
shall consent to any such relief or to the appointment of or taking possession
by any such official in an involuntary case or other proceeding commenced
against it, or shall make a general assignment for the benefit of creditors, or
shall admit in writing its inability to, or shall fail generally to, pay its
debts as they become due, or shall take any corporate action to authorize any
of the foregoing;

(h)        an involuntary case or other proceeding
shall be commenced against such Borrower or any of its Material Subsidiaries
seeking liquidation, reorganization or other relief with respect to it or its
debts under any bankruptcy, insolvency or other similar law now or hereafter in
effect or seeking the appointment of a trustee, receiver, liquidator, custodian
or other similar official of it or any substantial part of its property, and
such involuntary case or other proceeding shall remain undismissed and unstayed
for a period of 90 days; or an order for relief shall be entered against such
Borrower or any of its Material Subsidiaries under the federal bankruptcy laws
as now or hereafter in effect;

(i)         any member of such Borrower’s ERISA
Group shall fail to pay when due an amount or amounts aggregating in excess of
$25,000,000 which it shall have become liable to pay to the PBGC or to a Plan
under Title IV of ERISA; or notice of intent to terminate a Plan or Plans of
such ERISA Group having aggregate Unfunded Vested Liabilities in excess of
$50,000,000 (collectively, a “Material Plan”)
shall be filed under Title IV of ERISA by any member of such ERISA Group, any
plan administrator or any combination of the foregoing; or the PBGC shall
institute proceedings under Title IV of ERISA to terminate or to cause a
trustee to be appointed to administer any such Material Plan or a proceeding
shall be instituted by a fiduciary of any such Material Plan against any member
of such ERISA Group to enforce Section 515 or 4219(c)(5) of ERISA and such
proceeding shall not have been dismissed within 90 days thereafter; or a
condition shall exist by reason of which the PBGC would be 

 45
 

entitled to obtain a decree adjudicating that any such
Material Plan must be terminated;

(j)         a judgment or other court order for the
payment of money in excess of $50,000,000 shall be rendered against such
Borrower or any of its Material Subsidiaries and such judgment or order shall
continue without being vacated, discharged, satisfied or stayed or bonded
pending appeal for a period of 45 days; or

(k)        any person or group of persons (within
the meaning of Section 13 or 14 of the Securities Exchange Act of 1934, as
amended (the “Exchange Act”)) other than
trustees and participants in employee benefit plans of the Company and its
Subsidiaries or the Endowment or Trust, shall have acquired beneficial
ownership (within the meaning of Rule 13d-3 promulgated by the Securities and
Exchange Commission under the Exchange Act) of 50% or more of the outstanding
shares of common stock of the Company; during any period of twelve consecutive
calendar months, individuals who were directors of the Company on the first day
of such period (together with any successors nominated or appointed by such
directors in the ordinary course) shall cease to constitute a majority of the
board of directors of the Company; or in the case of any Borrower other than
the Company, such Borrower shall cease to be a Subsidiary of the Company;

then, and in every such
event, the Administrative Agent shall (i) if requested by Banks having more
than 66-2/3% in aggregate amount of the Commitments, by notice to such Borrower
terminate the Commitments as to such Borrower and they shall thereupon
terminate, and such Borrower shall no longer be entitled to borrow hereunder,
and the Sublimit of such Borrower shall be reduced to zero, and (ii) if
requested by Banks holding more than 66-2/3% in aggregate principal amount of the
Loans and Reimbursement Obligations of such Borrower, by notice to such
Borrower declare such Loans and Reimbursement Obligations (together with
accrued interest thereon) to be, and such Loans and Reimbursement Obligations
(together with accrued interest thereon) shall thereupon become, immediately
due and payable without presentment, demand, protest or other notice of any
kind, all of which are hereby waived by each Borrower; provided that in the case of any of the
Events of Default specified in clause (g) or (h) above with respect to such
Borrower, without any notice to such Borrower or any other act by the
Administrative Agent or the Banks, the Commitments shall thereupon terminate
with respect to such Borrower and the Loans and Reimbursement Obligations of
such Borrower (together with accrued interest thereon) shall become immediately
due and payable without presentment, demand, protest or other notice of any
kind, all of which are hereby waived by each Borrower.

Section
6.02.  Notice of
Default.  The Administrative
Agent shall give notice to a Borrower under Section 6.01(c) promptly upon being
requested to do 

 46
 

so by any Bank and shall thereupon notify all the
Banks and the Issuing Banks thereof.

Section
6.03.  Cash
Cover.  Each Borrower agrees,
in addition to the provisions of Section 6.01 hereof, that upon the occurrence
and during the continuance of any Event of Default with respect to such
Borrower, it shall, if requested by the Administrative Agent upon the
instruction of the Banks having at least 66 2/3% in the aggregate amount of the
Commitments (or, if the Commitments shall have been terminated, holding at
least 66 2/3% of the Letter of Credit Liabilities for the account of such
Borrower), deposit with the Administrative Agent an amount in immediately
available funds (which funds shall be held as collateral pursuant to
arrangements mutually satisfactory to the Administrative Agent and such
Borrower) equal to the aggregate amount available for drawing under all Letters
of Credit for the account of such Borrower then outstanding at such time; provided that upon the occurrence of any
Event of Default specified in Section 6.01(g) or 6.01(h) with respect to such
Borrower, such Borrower shall pay such amount forthwith without any notice or
demand or any other act by the Administrative Agent or the Banks.

ARTICLE 7

THE ADMINISTRATIVE AGENT

Section
7.01. 
Appointment and Authorization.  Each
Bank irrevocably appoints and authorizes the Administrative Agent to take such
action as agent on its behalf and to exercise such powers under this Agreement
and the Notes as are delegated to the Administrative Agent by the terms hereof
or thereof, together with all such powers as are reasonably incidental thereto.

Section
7.02. 
Administrative Agent and Affiliates. Wachovia  shall have the same rights and powers under this Agreement
as any other Bank and may exercise or refrain from exercising the same as
though it were not the Administrative Agent, and Wachovia and its affiliates
may accept deposits from, lend money to, and generally engage in any kind of
business with any Borrower or any Subsidiary or affiliate of any Borrower as if
it were not the Administrative Agent hereunder.

Section
7.03.  Action by
Administrative Agent.  The
obligations of the Administrative Agent hereunder are only those expressly set
forth herein. Without limiting the generality of the foregoing, the
Administrative Agent shall not be required to take any action with respect to
any Default, except as expressly provided in Article 6.

 47
 

Section
7.04. 
Consultation with Experts.  The
Administrative Agent may consult with legal counsel (who may be counsel for a
Borrower), independent public accountants and other experts selected by it and
shall not be liable for any action taken or omitted to be taken by it in good
faith in accordance with the advice of such counsel, accountants or experts.

Section
7.05.  Liability
of Administrative Agent.  Neither
the Administrative Agent nor any of its affiliates nor any of their respective
directors, officers, agents or employees shall be liable to any Bank for any
action taken or not taken by it in connection herewith (i) with the consent or
at the request of the Required Banks or (ii) in the absence of its own gross
negligence or willful misconduct. 
Neither the Administrative Agent nor any of its affiliates nor any of
their respective directors, officers, agents or employees shall be responsible
for or have any duty to ascertain, inquire into or verify (i) any statement,
warranty or representation made in connection with this Agreement or any
borrowing hereunder; (ii) the performance or observance of any of the covenants
or agreements of any Borrower; (iii) the satisfaction of any condition
specified in Article 3, except receipt of items required to be delivered to the
Administrative Agent; or (iv) the validity, effectiveness or genuineness of
this Agreement, the Notes or any other instrument or writing furnished in
connection herewith.  The Administrative
Agent shall not incur any liability by acting in reliance upon any notice,
consent, certificate, statement, or other writing (which may be a bank wire,
telex or similar writing) believed by it in good faith to be genuine or to be
signed by the proper party or parties. 
Without limiting the generality of the foregoing, the use of the term “agent”
in this Agreement with reference to the Administrative Agent is not intended to
connote any fiduciary or other implied (or express) obligations arising under
agency doctrine of any applicable law. 
Instead, such term is used merely as a matter of market custom and is
intended to create or reflect only an administrative relationship between
independent contracting parties.

Section
7.06. 
Indemnification.  Each
Bank shall, ratably in accordance with its Commitment, indemnify the Administrative
Agent, its affiliates and their respective directors, officers, agents and
employees (to the extent not reimbursed by the Borrowers) against any cost,
expense (including counsel fees and disbursements), claim, demand, action,
loss, penalties or liability (except such as result from such indemnitees’
gross negligence or willful misconduct) that such indemnitees may suffer or
incur in connection with this Agreement or any action taken or omitted by such
indemnitees thereunder.

Section
7.07.  Credit
Decision.  Each Bank
acknowledges that it has, independently and without reliance upon any Agent or
any other Bank, and based on such documents and information as it has deemed
appropriate, made its own credit analysis and decision to enter into this Agreement.  Each Bank also acknowledges that it will,
independently and without reliance upon any Agent or 

 48
 

any other Bank, and based on such documents and
information as it shall deem appropriate at the time, continue to make its own
credit decisions in taking or not taking any action under this Agreement.

Section
7.08.  Successor
Administrative Agent.  The
Administrative Agent may resign at any time by giving notice thereof to the
Banks and the Borrowers.  Upon any such
resignation, (i) the Company, with the consent of the Required Banks (such
consent not to be unreasonably withheld or delayed), or (ii) if an Event of
Default has occurred and is continuing, then the Required Banks, shall have the
right to appoint a successor Administrative Agent.  If no successor Administrative Agent shall
have been so appointed, and shall have accepted such appointment, within 30
days after the retiring Administrative Agent gives notice of resignation, then
the retiring Administrative Agent may, on behalf of the Banks, appoint a
successor Administrative Agent, which shall be a commercial bank organized or
licensed under the laws of the United States of America or of any State thereof
and having a combined capital and surplus of at least $250,000,000.  Upon the acceptance of its appointment as
Administrative Agent hereunder by a successor Administrative Agent, such
successor Administrative Agent shall thereupon succeed to and become vested
with all the rights and duties of the retiring Administrative Agent, and the
retiring Administrative Agent shall be discharged from its duties and
obligations hereunder; provided
that if such successor Administrative Agent is appointed without the consent of
the Company, such successor Administrative Agent may be replaced by the Company
with the consent of the Required Banks so long as no Event of Default has
occurred and is continuing at the time. 
After any retiring Administrative Agent’s resignation hereunder as
Administrative Agent, the provisions of this Article shall inure to its benefit
as to any actions taken or omitted to be taken by it while it was
Administrative Agent.

Section
7.09. 
Administrative Agent’s Fee.  The
Company shall pay to the Administrative Agent for its own account fees in the
amounts and at the times previously agreed upon between the Company and the
Administrative Agent.

Section
7.10.  Other
Agents.  None of the
Co-Syndication Agents or the Co-Documentation Agents, in their respective
capacities as such, shall have any duties or obligations of any kind under this
Agreement.

ARTICLE 8

CHANGE IN CIRCUMSTANCES

Section
8.01.  Basis for
Determining Interest Rate Inadequate or Unfair. 
If on or prior to the first day of any Interest Period for
any Euro-Dollar  Borrowing:

 

 49

(a)   the Administrative Agent is advised by the
Euro-Dollar Reference Banks that deposits in dollars (in the applicable
amounts) are not being offered to the Euro-Dollar Reference Banks in the
relevant market for such Interest Period, or

(b)   Banks having 66-2/3% or more of the aggregate
amount of the affected Loans advise the Administrative Agent that the London
Interbank Offered Rate as determined by the Administrative Agent will not
adequately and fairly reflect the cost to such Banks of funding their Euro-Dollar
Loans for such Interest Period,

the Administrative Agent
shall forthwith give notice thereof to the Borrowers and the Banks, whereupon
until the Administrative Agent notifies the Borrower that the circumstances
giving rise to such suspension no longer exist, (i) the obligations of the
Banks to make Euro-Dollar Loans or to continue or convert outstanding Loans as
or into Euro-Dollar Loans shall be suspended and (ii) each outstanding
Euro-Dollar Loan shall be converted into a Base Rate Loan on the last day of
the then current Interest Period applicable thereto. Unless the Borrower
notifies the Administrative Agent at least one Domestic Business Day before the
date of any Euro-Dollar Borrowing for which a Notice of Borrowing has
previously been given that it elects not to borrow on such date, such Borrowing
shall instead be made as a Base Rate Borrowing.

Section
8.02. 
Illegality.  If on or
after the date of this Agreement, the adoption of any applicable law, rule or
regulation, or any change in any applicable law, rule or regulation, or any
change in the interpretation or administration thereof by any governmental
authority, central bank or comparable agency charged with the interpretation or
administration thereof, or compliance by any Bank (or its Euro-Dollar
Lending Office) with any request or directive (whether or not having the force
of law) of any such authority, central bank or comparable agency shall make it
unlawful or impossible for any Bank (or its Euro-Dollar Lending Office)
to make, maintain or fund any of its Euro-Dollar Loans and such Bank
shall so notify the Administrative Agent, the Administrative Agent shall
forthwith give notice thereof to the other Banks and the Borrowers, whereupon
until such Bank notifies the Borrowers and the Administrative Agent that the
circumstances giving rise to such suspension no longer exist, the obligation of
such Bank to make Euro-Dollar Loans, or to continue or convert
outstanding Loans as or into Euro-Dollar Loans, shall be suspended. Before
giving any notice to the Administrative Agent pursuant to this Section, such
Bank shall designate a different Euro-Dollar Lending Office if such
designation will avoid the need for giving such notice and will not be
otherwise disadvantageous to such Bank in the good faith exercise of its
discretion.  If such notice is given,
each Euro-Dollar Loan of such Bank then outstanding shall be converted to a
Base Rate Loan either (a) on the last day of the then current Interest Period
applicable to such Euro-Dollar Loan if such Bank may lawfully continue to
maintain and fund such Loan 

 50
 

to such day or (b) immediately if such Bank shall
determine that it may not lawfully continue to maintain and fund such Loan to
such day.

Section
8.03.  Increased
Cost and Reduced Return.  (a)   If on or after the
date of this Agreement, the adoption of any applicable law, rule or regulation,
or any change in any applicable law, rule or regulation, or any change in the
interpretation or administration thereof by any governmental authority, central
bank or comparable agency charged with the interpretation or administration
thereof, or compliance by any Bank (the terms “Bank” and “Issuing Bank” shall
include, for purposes of this Section 8.03, the holding company of any Issuing
Bank) (or its Applicable Lending Office) with any request or directive (whether
or not having the force of law) issued on or after such date of any such
authority, central bank or comparable agency shall impose, modify or deem
applicable any reserve, special deposit or similar requirement (including,
without limitation, any such requirement imposed by the Board of Governors of
the Federal Reserve System, but excluding with respect to any Euro-Dollar
Loan any such requirement included in an applicable Euro-Dollar Reserve
Percentage) against assets of, deposits with or for the account of, or credit
extended by, any Bank (or its Applicable Lending Office) or shall impose on any
Bank (or its Applicable Lending Office) or on the London interbank market any
other condition (other than in respect of Taxes or Other Taxes) affecting its
Euro-Dollar Loans, its Note or its obligation to make Euro-Dollar Loans or its
obligations hereunder in respect of Letters of Credit and the result of any of
the foregoing is to increase the cost to such Bank (or its Applicable Lending
Office) of making or maintaining any Euro-Dollar Loan or of issuing or
participating in any Letter of Credit, or to reduce the amount of any sum
received or receivable by such Bank (or its Applicable Lending Office) under
this Agreement or under its Note with respect thereto, by an amount deemed by
such Bank to be material, then, within 15 days after demand by such Bank (with
a copy to the Administrative Agent), each Borrower shall pay to such Bank its
Appropriate Share of such additional amount or amounts as will compensate such
Bank for such increased cost or reduction; provided
that no such amount shall be payable with respect to any period commencing more
than 90 days prior to the date such Bank first notifies the Borrowers of its
intention to demand compensation therefor under this Section 8.03(a).

(b)   If any Bank shall have determined that, on or
after the date of this Agreement, the adoption of any applicable law, rule or
regulation regarding capital adequacy, or any change in any such law, rule or
regulation, or any change in the interpretation or administration thereof by
any governmental authority, central bank or comparable agency charged with the
interpretation or administration thereof, or any request or directive regarding
capital adequacy (whether or not having the force of law) of any such
authority, central bank or comparable agency given or made after the date of
this Agreement, has or would have the effect of reducing the rate of return on
capital of such Bank (or its Parent) as a consequence of such Bank’s
obligations hereunder to a level below that which such Bank (or its 

 51
 

Parent) could have achieved but for such adoption,
change, request or directive (taking into consideration its policies with
respect to capital adequacy) by an amount deemed by such Bank to be material,
then from time to time, within 15 days after demand by such Bank (with a copy
to the Administrative Agent), each Borrower shall pay to such Bank its
Appropriate Share of such additional amount or amounts as will compensate such
Bank (or its Parent) for such reduction; provided
that no such amount shall be payable with respect to any period commencing less
than 30 days after the date such Bank first notifies the Borrowers of its
intention to demand compensation under this Section 8.03(b).

(c)   Each Bank will promptly notify the Borrowers
and the Administrative Agent of any event of which it has knowledge, occurring
after the date hereof, which will entitle such Bank to compensation pursuant to
this Section and will designate a different Applicable Lending Office if such
designation will avoid the need for, or reduce the amount of, such compensation
and will not, in the judgment of such Bank, be otherwise disadvantageous to
such Bank.  A certificate of any Bank
claiming compensation under this Section and setting forth the additional
amount or amounts to be paid to it hereunder shall be conclusive in the absence
of manifest error.  In determining such
amount, such Bank may use any reasonable averaging and attribution methods.

(d)   The “Appropriate Share”
of a Borrower with respect to any amount payable hereunder is the sum of (i) to
the extent such amount is properly allocable to Loans and Letters of Credit
outstanding hereunder, the portion of such amount properly allocable to the
Loans and Letter of Credit outstanding to or for the account of such Borrower,
and (ii) to the extent such amount is not properly allocable to Loans and
Letters of Credit outstanding hereunder, the Appropriate Share shall be the product
of the Availability Percentage of such Borrower and such amount.

Section
8.04. 
Taxes.  (a)  For purposes of this
Section 8.04 the following terms have the following meanings:

“Taxes” means any and all present or future
taxes, duties, levies, imposts, deductions, charges or withholdings with
respect to any payment by a Borrower pursuant to this Agreement or any Note,
and all liabilities with respect thereto, excluding
(i) in the case of each Bank and the Administrative Agent, taxes imposed on its
income, net worth or gross receipts and franchise or similar taxes imposed on
it by a jurisdiction under the laws of which such Bank or the Administrative
Agent (as the case may be) is organized or in which its principal executive
office is located or, in the case of each Bank, in which its Applicable Lending
Office is located and (ii) in the case of each Bank, any United States 

 52
 

withholding tax imposed on such payments except to the
extent that such Bank is subject to United States withholding tax by reason of
a U.S. Tax Law Change.

“Other Taxes” means any present or future
stamp or documentary taxes and any other excise or property taxes, or similar
charges or levies, which arise from any payment made pursuant to this Agreement
or under any Note or from the execution or delivery of, or otherwise with
respect to, this Agreement or any Note.

“U.S. Tax Law Change” means with respect to
any Bank or Participant the occurrence (x) in the case of each Bank listed on
the signature pages hereof, after the date of its execution and delivery of
this Agreement and (y) in the case of any other Bank, after the date such Bank
shall have become a Bank hereunder, and (z) in the case of each Participant,
after the date such Participant became a Participant hereunder, of the adoption
of any applicable U.S. federal law, U.S. federal rule or U.S. federal
regulation relating to taxation, or any change therein, or the entry into
force, modification or revocation of any income tax convention or treaty to
which the United States is a party.

(b)   Any and all payments by any Borrower to or
for the account of any Bank or the Administrative Agent hereunder or under any
Note shall be made without deduction for any Taxes or Other Taxes; provided that, if any Borrower shall be
required by law to deduct any Taxes or Other Taxes from any such payments,
(i) the sum payable shall be increased as necessary so that after making
all required deductions (including deductions applicable to additional sums
payable under this Section 8.04) such Bank or the Administrative Agent (as the
case may be) receives an amount equal to the sum it would have received had no
such deductions been made, (ii) such Borrower shall make such deductions,
(iii) such Borrower shall pay the full amount deducted to the relevant taxation
authority or other authority in accordance with applicable law and
(iv) such Borrower shall furnish to the Administrative Agent, at its
address referred to in Section 9.01, the original or a certified copy of a
receipt evidencing payment thereof.

(c)   Each Borrower agrees to indemnify each Bank
and the Administrative Agent for its Appropriate Share of the full amount of
Taxes or Other Taxes (including, without limitation, any Taxes or Other Taxes
imposed or asserted by any jurisdiction on amounts payable under this Section
8.04) paid by such Bank or the Administrative Agent (as the case may be) and
any liability (including penalties, interest and expenses) arising therefrom or
with respect thereto. This indemnification shall be paid within 15 days after
such Bank or the Administrative Agent (as the case may be) makes demand
therefor.

(d)   Each Bank organized under the laws of a
jurisdiction outside the United States, on or prior to the date of its
execution and delivery of this 

 53
 

Agreement in the case of each Bank listed on the
signature pages hereof and on or prior to the date on which it becomes a Bank
in the case of each other Bank, and from time to time thereafter as required by
law (but only so long as such Bank remains lawfully able to do so), shall
provide the Borrowers two completed and duly executed copies of Internal
Revenue Service form W-8BEN or W-8ECI, as appropriate, or any successor form
prescribed by the Internal Revenue Service, or other documentation reasonably
requested by the Borrowers, certifying that such Bank is entitled to benefits
under an income tax treaty to which the United States is a party which exempts
the Bank from United States withholding tax or reduces the rate of withholding
tax on payments of interest for the account of such Bank or certifying that the
income receivable pursuant to this Agreement is effectively connected with the
conduct of a trade or business in the United States.

(e)   For any period with respect to which a Bank
has failed to provide the Borrowers with the appropriate form pursuant to
Section 8.04(d) (unless such failure is due to a U.S. Tax Law Change), such
Bank shall not be entitled to indemnification under Section 8.04(b) or 8.04(c)
with respect to any Taxes or Other Taxes which would not have been payable had
such form been so provided; provided
that if a Bank, which is otherwise exempt from or subject to a reduced rate of
withholding tax, becomes subject to Taxes because of its failure to deliver a
form required hereunder, the Borrowers shall take such steps as such Bank shall
reasonably request to assist such Bank to recover such Taxes (it being
understood, however, that the Borrowers shall have no liability to such Bank in
respect of such Taxes).

(f)    If any Borrower is required to pay
additional amounts to or for the account of any Bank pursuant to this Section
8.04, then such Bank will take such action (including changing the jurisdiction
of its Applicable Lending Office) as in the good faith judgment of such Bank
(i) will eliminate or reduce any such additional payment which may thereafter
accrue and (ii) is not otherwise disadvantageous to such Bank.

(g)   If any Bank or the Administrative Agent
receives a refund (including a refund in the form of a credit against taxes
that are otherwise payable by the Bank or the Administrative Agent) of any
Taxes or Other Taxes for which any Borrower has made a payment under Section
8.04(b) or (c) and such refund was received from the taxing authority which
originally imposed such Taxes or Other Taxes, such Bank or the Administrative
Agent agrees to reimburse such Borrower to the extent of such refund; provided that nothing contained in this
paragraph (g) shall require any Bank or the Administrative Agent to seek any
such refund or make available its tax returns (or any other information
relating to its taxes which it deems to be confidential).

Section
8.05.  Base Rate
Loans Substituted for Affected Euro-Dollar Loans.  If (i) the obligation of any Bank
to make or to continue or convert 

 54
 

outstanding Loans as or into Euro-Dollar Loans
has been suspended pursuant to Section 8.02 or (ii) any Bank has demanded
compensation under Section 8.03(a) or 8.04 with respect to its Euro-Dollar
Loans and the Borrower shall, by at least five Euro-Dollar Business Days’
prior notice to such Bank through the Administrative Agent, have elected that
the provisions of this Section shall apply to such Bank, then, unless and until
such Bank notifies the Borrowers that the circumstances giving rise to such
suspension or demand for compensation no longer apply:

(a)   all Loans which would otherwise be made by
such Bank as (or continued as or converted to) Euro-Dollar Loans, as the
case may be, shall instead be Base Rate Loans (on which interest and principal
shall be payable contemporaneously with the related Euro-Dollar Loans of the
other Banks), and

(b)   after each of its Euro-Dollar Loans has
been repaid, all payments of principal which would otherwise be applied to
repay such Loans shall be applied to repay its Base Rate Loans instead.

If such Bank notifies the
Borrowers that the circumstances giving rise to such suspension or demand for
compensation no longer exist, the principal amount of each such Base Rate Loan
shall be converted into a Euro-Dollar Loan on the first day of the next
succeeding Interest Period applicable to the related Euro-Dollar Loans of the
other Banks.

Section
8.06. 
Substitution of Bank; Termination Option.  If (i) the obligation of any Bank
to make or to convert or continue outstanding Loans as or into Euro-Dollar
Loans has been suspended pursuant to Section 8.02, (ii) any Bank has demanded
compensation under Section 8.03 or 8.04, (iii) any Bank exercises its right not
to extend its Commitment Termination Date pursuant to Section 2.01(c) or (iv)
Investment Grade Status ceases to exist as to any Bank, then:

(a)   the Company shall have the right, with the
assistance of the Administrative Agent, to designate a substitute bank or banks
(which may be one or more of the Banks) mutually satisfactory to the Company,
the Administrative Agent, the Swingline Bank and the Issuing Banks (whose
consent shall not be unreasonably withheld or delayed) to purchase for cash,
pursuant to an Assignment and Assumption Agreement in substantially the form of
Exhibit D hereto, the outstanding Loans of such Bank and assume the Commitment
and Letter of Credit Liabilities of such Bank, without recourse to or warranty
by, or expense to, such Bank, for a purchase price equal to the principal
amount of all of such Bank’s outstanding Loans and funded Letter of Credit
Liabilities plus any accrued but unpaid interest thereon and the accrued but
unpaid fees in respect of such Bank’s Commitment hereunder and all other
amounts payable by the Borrowers to such Bank hereunder plus such amount, if
any, as would be payable 

 55
 

pursuant to Section 2.13 if the outstanding Loans of
such Bank were prepaid in their entirety on the date of consummation of such
assignment; and

(b)   if at the time Investment Grade Status exists
as to the Borrowers, the Company may elect to terminate this Agreement as to
such Bank; provided that (i)  the Company notifies such Bank through the
Administrative Agent of such election at least three Euro-Dollar Business
Days before the effective date of such termination, (ii) the Borrowers repay or
prepay the principal amount of all outstanding Loans made by such Bank plus any
accrued but unpaid interest thereon and the accrued but unpaid fees in respect
of such Bank’s Commitment hereunder plus all other amounts payable by the
Borrowers to such Bank hereunder, not later than the effective date of such
termination and (iii) if at the effective date of such termination, any Letter
of Credit Liabilities or Swingline Loans are outstanding, the conditions
specified in Section 3.02 would be satisfied (after giving effect to such
termination) were the related Letters of Credit issued or the related Swingline
Loans made on such date.  Upon
satisfaction of the foregoing conditions, the Commitment of such Bank shall
terminate on the effective date specified in such notice, its participation in
any outstanding Letters of Credit or Swingline Loans shall terminate on such
effective date and the participations of the other Banks therein shall be
redetermined as of such date as if such Letters of Credit had been issued or such
Swingline Loans had been made on such date.

ARTICLE 9

MISCELLANEOUS

Section
9.01. 
Notices.  All notices,
requests and other communications to any party hereunder shall be in writing
(including bank wire, telex, facsimile transmission or similar writing) and
shall be given to such party:  (x) in the
case of any Borrower or the Administrative Agent, at its address or telecopy or
telex number set forth on the signature pages hereof, (y) in the case of any
Bank, at its address or telecopy or telex number set forth in its
Administrative Questionnaire or (z) in the case of any party, such other
address or telecopy or telex number as such party may hereafter specify for the
purpose by notice to the Administrative Agent and the Borrowers.  Each such notice, request or other
communication shall be effective (i) if given by telecopy or telex, when such
telecopy or telex is transmitted to the telecopy or telex number specified in
this Section and the appropriate answerback or confirmation slip, as the case
may be, is received or (ii) if given by any other means, when delivered at the
address specified in this Section; provided
that notices to the Administrative Agent, the Swingline Bank or any Issuing
Bank under Article 2 or Article 8 shall not be effective until delivered.

 56
 

Section
9.02.  No
Waivers.  No failure or delay
by the Administrative Agent or any Bank in exercising any right, power or
privilege hereunder or under any Note shall operate as a waiver thereof nor
shall any single or partial exercise thereof preclude any other or further
exercise thereof or the exercise of any other right, power or privilege.  The rights and remedies herein provided shall
be cumulative and not exclusive of any rights or remedies provided by law.

Section
9.03.  Expenses;
Indemnification.  (a)  Each Borrower shall
pay (i) its Appropriate Share of all reasonable out-of-pocket
expenses of the Administrative Agent, including reasonable fees and
disbursements of special counsel for the Agents, in connection with the
preparation of this Agreement, any waiver or consent hereunder or any amendment
hereof or any Default or alleged Default with respect to such Borrower
hereunder and (ii) if an Event of Default with respect to such Borrower occurs,
all reasonable out-of-pocket expenses incurred by the
Administrative Agent or any Bank, including reasonable fees and disbursements
of counsel, in connection with such Event of Default and collection and other
enforcement proceedings resulting therefrom.

(b)   Each Borrower agrees to indemnify each Agent
and each Bank, their respective affiliates and the respective directors,
officers, agents and employees of the foregoing (each an “Indemnitee”) and hold each Indemnitee
harmless from and against any and all liabilities, losses, penalties, damages,
costs and expenses of any kind, including, without limitation, the reasonable
fees and disbursements of counsel, which may be incurred by such Indemnitee in
connection with any investigative, administrative or judicial proceeding
(whether or not such Indemnitee shall be designated a party thereto) relating
to or arising out of this Agreement or any actual or proposed use of proceeds
of Loans hereunder, in each case to the extent of such Borrower’s Appropriate
Share; provided that no
Indemnitee shall have the right to be indemnified hereunder for such
Indemnitee’s own gross negligence or willful misconduct as determined by a
court of competent jurisdiction.

Section
9.04.  Sharing of
Set-offs.  Each Bank agrees
that if it shall, by exercising any right of set-off or counterclaim or
otherwise, receive payment of a proportion of the aggregate amount then due
with respect to the Loans and Letter of Credit Liabilities held by it which is
greater than the proportion received by any other Bank in respect of the
aggregate amount then due with respect to the Loans and Letter of Credit
Liabilities held by such other Bank, the Bank receiving such proportionately
greater payment shall purchase such participations in the Loans and Letter of
Credit Liabilities held by the other Banks, and such other adjustments shall be
made, as may be required so that all such payments with respect to the Loans
and Letter of Credit Liabilities held by the Banks shall be shared by the Banks
pro rata; provided that (i)
nothing in this Section shall impair the right of any Bank to exercise any
right of set-off or counterclaim it may have and to apply the amount
subject to such exercise to the payment of indebtedness 

 57
 

of a Borrower other than its indebtedness under this
Agreement and (ii) this Section is not applicable to Swingline Loans.

Section
9.05.  Amendments
and Waivers.  (a) Any
provision of this Agreement or the Notes may be amended or waived if, but only
if, such amendment or waiver is in writing and is signed by each Borrower and
the Required Banks (and, if the rights or duties of any Agent, the Swingline
Bank or any Issuing Bank are affected thereby, by such Person); provided that no such amendment or waiver
shall (x) unless signed by each affected Bank, (i) increase the Commitment of
any Bank or subject any Bank to any additional obligation, (ii) reduce the
principal of or rate of interest on any Loan or the amount to be reimbursed in
respect of any Letter of Credit or any interest thereon or any fees hereunder
or (iii) postpone the date fixed for any payment of principal of or interest on
any Loan or for reimbursement in respect of any Letter of Credit or interest
thereon or any fees hereunder or for termination of any Commitment or (y)
unless signed by all Banks, (i) change the definition of Required Banks or the
provisions of this Section 9.05 or (ii) change the provisions of Section 9.04.

(b)   This Agreement may be amended by the Company
to remove any other Borrower as a Borrower (a “Removed
Borrower”) hereunder subject to: (i) the receipt by the
Administrative Agent of prior notice from the Company of such amendment, (ii)
repayment in full of all Loans made to such Borrower, (iii) cash
collateralization of all amounts available for drawing under Letters of Credit
issued for the account of such Borrower (or the amendment of such Letter of
Credit to provide for the Company as the account party) and (iv) repayment in
full of all other amounts owing by such Borrower under this Agreement (it being
agreed that any such repayment shall be in accordance with the other terms of
this Agreement).  Upon the satisfaction
of the foregoing conditions the rights and obligations of such Removed Borrower
hereunder shall terminate; provided, however,
that the obligations of such Removed Borrower under Section 9.03 shall survive
such amendment.

Section
9.06.  Successors
and Assigns.  (a)  The provisions of
this Agreement shall be binding upon and inure to the benefit of the parties
hereto and their respective successors and assigns and each Indemnitee, except
that no Borrower may assign or otherwise transfer any of its rights under this
Agreement without the prior written consent of all Banks.

(b)   Any Bank may, with the consent (unless an
Event of Default then exists) of the Company (such consent not to be unreasonably
withheld or delayed), at any time grant to one or more banks or other
institutions (each a “Participant”)
participating interests in its Commitment or any or all of its Loans and Letter
of Credit Liabilities; provided that
any Bank may, without the consent of any Borrower, at any time grant
participating interests in its Commitment or any or all of its Loans and Letter
of Credit Liabilities to another Bank, an 

 58
 

Approved Fund or an Affiliate of such transferor
Bank.  In the event of any such grant by a
Bank of a participating interest to a Participant, whether or not upon notice
to the Administrative Agent, such Bank shall remain responsible for the
performance of its obligations hereunder, and the Borrowers, the Issuing Banks,
the Swingline Bank and the Administrative Agent shall continue to deal solely
and directly with such Bank in connection with such Bank’s rights and
obligations under this Agreement. Any agreement pursuant to which any Bank may
grant such a participating interest shall provide that such Bank shall retain
the sole right and responsibility to enforce the obligations of the Borrowers
hereunder including, without limitation, the right to approve any amendment,
modification or waiver of any provision of this Agreement; provided that such participation agreement
may provide that such Bank will not agree to any modification, amendment or
waiver of this Agreement described in clause (x) (i), (ii) or (iii) of Section
9.05(a) without the consent of the Participant. 
Each Borrower agrees that each Participant shall, to the extent provided
in its participation agreement, be entitled to the benefits of Article 8 with
respect to its participating interest, subject to the performance by such
Participant of the obligations of a Bank thereunder. An assignment or other
transfer which is not permitted by subsection (c) or (d) below shall be given
effect for purposes of this Agreement only to the extent of a participating
interest granted in accordance with this subsection (b).

(c)   Any Bank may at any time assign to one or
more banks or other financial institutions (each an “Assignee”) all, or a proportionate part (equivalent to an
initial Commitment of not less than $10,000,000 (unless the Company and the
Administrative Agent shall otherwise agree)) of all, of its rights and
obligations under this Agreement and its Note (if any), and such Assignee shall
assume such rights and obligations, pursuant to an Assignment and Assumption
Agreement in substantially the form of Exhibit D hereto executed by such Assignee
and such transferor Bank, with (and only with and subject to) the prior written
consent of the Swingline Bank, the Issuing Banks, the Administrative Agent
(which shall not be unreasonably withheld or delayed) and, so long as no Event
of Default has occurred and is continuing, the Company (which shall not be
unreasonably withheld or delayed); provided
that unless such assignment is of the entire right, title and interest of the
transferor Bank hereunder, after making any such assignment such transferor Bank
shall have a Commitment of at least $10,000,000 (unless the Company and the
Administrative Agent shall otherwise agree). 
Upon execution and delivery of such instrument of assumption and payment
by such Assignee to such transferor Bank of an amount equal to the purchase
price agreed between such transferor Bank and such Assignee, such Assignee
shall be a Bank party to this Agreement and shall have all the rights and
obligations of a Bank with a Commitment as set forth in such instrument of
assumption, and the transferor Bank shall be released from its obligations
hereunder to a corresponding extent, and no further consent or action by any
party shall be required.  Upon the
consummation of any assignment pursuant to this

 59
 

subsection (c), the transferor Bank, the
Administrative Agent and the Borrowers shall make appropriate arrangements so
that, if required by the Assignee, a Note(s) is issued to the Assignee. If the
Assignee is not incorporated under the laws of the United States of America or
a state thereof, it shall, prior to the first date on which interest or fees
are payable hereunder for its account, deliver to the Borrowers and the
Administrative Agent certification as to exemption from deduction or
withholding of any United States federal income taxes in accordance with
Section 8.04.  All assignments (other
than assignments to Affiliates) shall be subject to a transaction fee
established by, and payable by the transferor Bank to, the Administrative Agent
for its own account (which shall not exceed $5,000).

(d)   Any Bank may at any time assign all or any
portion of its rights under this Agreement and its Note (if any) to a Federal
Reserve Bank.  No such assignment shall
release the transferor Bank from its obligations hereunder or modify any such
obligations.

(e)   No Assignee, Participant or other transferee
of any Bank’s rights (including any Applicable Lending Office other than such
Bank’s initial Applicable Lending Office) shall be entitled to receive any
greater payment under Section 8.03 or 8.04 than such Bank would have been
entitled to receive with respect to the rights transferred, unless such
transfer is made by reason of the provisions of Section 8.02, 8.03 or 8.04
requiring such Bank to designate a different Applicable Lending Office under certain
circumstances or at a time when the circumstances giving rise to such greater
payment did not exist.

Section
9.07. 
Collateral.  Each of
the Banks represents to the Administrative Agent and each of the other Banks
that it in good faith is not relying upon any “margin stock” (as defined in Regulation U) as collateral in
the extension or maintenance of the credit provided for in this Agreement.

Section
9.08. 
Confidentiality.  Each
Agent and each Bank agrees to keep any information delivered or made available
by any Borrower pursuant to this Agreement confidential from anyone other than
persons employed or retained by such Bank and its affiliates who are engaged in
evaluating, approving, structuring or administering the credit facility
contemplated hereby; provided
that nothing herein shall prevent any Bank from disclosing such information (a)
to any other Bank or any Agent, (b) to any other Person if reasonably
incidental to the administration of the credit facility contemplated hereby,
(c) upon the order of any court or administrative agency, (d) upon the request
or demand of any regulatory agency or authority, (e) which had been publicly
disclosed other than as a result of a disclosure by any Agent or any Bank
prohibited by this Agreement, (f) in connection with any litigation to which
any Agent, any Bank or its subsidiaries or Parent may be a party, (g) to the
extent necessary in connection with the exercise of any remedy hereunder, (h)
to such Bank’s or any Agent’s legal counsel and independent auditors, (i)
subject to provisions substantially 

 60
 

similar to those contained in this Section 9.08, to
any actual or proposed Participant or Assignee and (j) to any direct, indirect,
actual or prospective counterparty (and its advisor) to any swap, derivative or
securitization transaction related to the obligations under this Agreement.

Section
9.09.  Governing
Law; Submission to Jurisdiction.  This Agreement and each Note (if
any) shall be construed in accordance with and governed by the law of the State
of New York.  Each Borrower hereby
submits to the nonexclusive jurisdiction of the United States District Court
for the Southern District of New York and of any New York State court sitting
in New York City for purposes of all legal proceedings arising out of or relating
to this Agreement or the transactions contemplated hereby.  Each Borrower irrevocably waives, to the
fullest extent permitted by law, any objection which it may now or hereafter
have to the laying of the venue of any such proceeding brought in such a court
and any claim that any such proceeding brought in such a court has been brought
in an inconvenient forum.

Section
9.10. 
Counterparts; Integration.  This
Agreement may be signed in any number of counterparts, each of which shall be
an original, with the same effect as if the signatures thereto and hereto were
upon the same instrument. This Agreement constitutes the entire agreement and
understanding among the parties hereto and supersedes any and all prior
agreements and understandings, oral or written, relating to the subject matter
hereof.

Section
9.11.  WAIVER OF
JURY TRIAL.  EACH OF THE
BORROWERS, THE AGENTS, THE ISSUING BANKS AND THE BANKS, TO THE FULLEST EXTENT
IT MAY EFFECTIVELY DO SO UNDER APPLICABLE LAW, HEREBY IRREVOCABLY WAIVES ANY
AND ALL RIGHT TO TRIAL BY JURY IN ANY LEGAL PROCEEDING ARISING OUT OF OR
RELATING TO THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY.

Section
9.12.  USA
Patriot Act.  Each Bank hereby
notifies each Borrower that pursuant to the requirements of the USA Patriot
Act, Title III of Pub. L. 107-56 (signed into law October 26, 2001) (the “Act”), it is required to obtain, verify and
record information that identifies such Borrower, which information includes
the name and address of such Borrower and other information that will allow
such Bank to identify such Borrower in accordance with the Act.

 61

IN WITNESS WHEREOF, the
parties hereto have caused this Agreement to be duly executed by their
respective authorized officers as of the day and year first above written.

	
  

  	
  DUKE ENERGY CORPORATION

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Title:

  	
   

  	
  Senior Vice President and Treasurer

  
	
   

  	
   

  	
  Address:

  	
   

  	
  526 South Church Street 

  Charlotte, NC 28202-1904

  
	
   

  	
   

  	
  Attention:

  	
   

  	
  Lynn J. Good

  
	
   

  	
   

  	
  Telecopy number:

  	
   

  	
  704-382-3288

  
	
   

  	
   

  	
  Taxpayer 

  ID:

  	
   

  	
  20-2777218

  

 

	
  

  	
  DUKE ENERGY CAROLINAS, LLC

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Title:

  	
   

  	
  Senior Vice President and Treasurer

  
	
   

  	
   

  	
  Address:

  	
   

  	
  526 South Church Street

  Charlotte, NC 
  28202-1904

  
	
   

  	
   

  	
  Attention:

  	
   

  	
  Lynn J. Good

  
	
   

  	
   

  	
  Telecopy number:

  	
   

  	
  704-382-3288

  
	
   

  	
   

  	
  Taxpayer ID:

  	
   

  	
  56-0205520

  

 

 

	
  

  	
  DUKE ENERGY OHIO, INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Title:

  	
   

  	
  Senior Vice President and
  Treasurer

  
	
   

  	
   

  	
  Address:

  	
   

  	
  526 South Church Street

  Charlotte, NC  28202-1904

  
	
   

  	
   

  	
  Attention:

  	
   

  	
  Lynn J. Good

  
	
   

  	
   

  	
  Telecopy number:

  	
   

  	
  704-382-3288

  
	
   

  	
   

  	
  Taxpayer ID:

  	
   

  	
  31-0240030

  

 

	
  

  	
  DUKE ENERGY INDIANA, INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Title:

  	
   

  	
  Senior Vice President and
  Treasurer

  
	
   

  	
   

  	
  Address:

  	
   

  	
  526 South Church Street

  Charlotte, NC  28202-1904

  
	
   

  	
   

  	
  Attention:

  	
   

  	
  Lynn J. Good

  
	
   

  	
   

  	
  Telecopy number:

  	
   

  	
  704-382-3288

  
	
   

  	
   

  	
  Taxpayer ID:

  	
   

  	
  35-0594457

  

 

	
  

  	
  DUKE ENERGY KENTUCKY, INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Title:

  	
   

  	
  Senior Vice President and Treasurer

  
	
   

  	
   

  	
  Address:

  	
   

  	
  526 South Church Street

  Charlotte, NC 
  28202-1904

  
	
   

  	
   

  	
  Attention:

  	
   

  	
  Lynn J. Good

  
	
   

  	
   

  	
  Telecopy number:

  	
   

  	
  704-382-3288

  
	
   

  	
   

  	
  Taxpayer ID:

  	
   

  	
  31-0473080

  

 

 2
 

 

	
  

  	
  WACHOVIA BANK,
  NATIONAL ASSOCIATION, as Administrative Agent, as an Issuing Bank, as
  Swingline Bank and as a Bank

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  	
   

  	
   

  
	
   

  	
   

  	
  Title:

  	
   

  	
   

  

 

 3
 

 

	
  

  	
  JPMORGAN CHASE
  BANK, NATIONAL ASSOCIATION, as Co-Syndication Agent, as an Issuing Bank and
  as a Bank

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  	
   

  	
   

  
	
   

  	
   

  	
  Title:

  	
   

  	
   

  

 

 4
 

 

	
  

  	
  BARCLAYS BANK
  PLC, as Co-Syndication Agent, as an Issuing Bank and as a Bank

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  	
   

  	
   

  
	
   

  	
   

  	
  Title:

  	
   

  	
   

  

 

 5
 

 

	
  

  	
  BANK OF AMERICA,
  N.A., as Co-Syndication Agent and as a Bank

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  	
   

  	
   

  
	
   

  	
   

  	
  Title:

  	
   

  	
   

  

 

 6
 

 

	
  

  	
  CITIBANK, N.A.,
  as Co-Syndication Agent and as a Bank

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  	
   

  	
   

  
	
   

  	
   

  	
  Title:

  	
   

  	
   

  

 

 7
 

 

	
  

  	
  THE BANK OF TOKYO-MITSUBISHI
  UFJ, LTD., NEW YORK BRANCH as a Bank

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  	
   

  	
   

  
	
   

  	
   

  	
  Title:

  	
   

  	
   

  

 

 8
 

 

	
  

  	
  CREDIT SUISSE,
  CAYMAN ISLANDS BRANCH, as a Bank

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  	
   

  	
   

  
	
   

  	
   

  	
  Title:

  	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  	
   

  	
   

  
	
   

  	
   

  	
  Title:

  	
   

  	
   

  

 

 9
 

 

	
  

  	
  ABN AMRO BANK,
  N.V., as a Bank

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  	
   

  	
   

  
	
   

  	
   

  	
  Title:

  	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  	
   

  	
   

  
	
   

  	
   

  	
  Title:

  	
   

  	
   

  

 

 10

	
  

  	
  THE BANK OF NEW YORK, as a Bank

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  

 

 11
 

 

	
  

  	
  DEUTSCHE BANK AG
  NEW YORK BRANCH, as a Bank

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  

 

 12
 

 

	
  

  	
  WILLIAM STREET
  COMMITMENT CORPORATION, as a Bank

  (Recourse only
  to assets of William Street Commitment Corporation)

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  

 

 13
 

 

	
  

  	
  KEYBANK NATIONAL
  ASSOCIATION, as a Bank

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  

 

 14
 

 

	
  

  	
  LEHMAN BROTHERS
  BANK, FSB, as a Bank

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  

 

 15
 

 

	
  

  	
  MERRILL LYNCH
  BANK, USA, as a Bank

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  

 

 16
 

 

	
  

  	
  MORGAN STANLEY
  BANK, as a Bank

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  

 

 17
 

 

	
  

  	
  THE ROYAL BANK
  OF SCOTLAND, PLC, as a Bank

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  

 

 18
 

 

	
  

  	
  UBS LOAN FINANCE
  LLC, as a Bank

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  

 

 19
 

 

	
  

  	
  THE BANK OF NOVA
  SCOTIA, as a Bank

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  

 

 20

	
  

  	
  BNP PARIBAS, as
  a Bank

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  

 

 21
 

 

	
  

  	
  DRESDNER BANK
  AG, NEW YORK AND GRAND CAYMAN BRANCHES, as a Bank

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  

 

 22
 

 

	
  

  	
  THE NORTHERN
  TRUST COMPANY, as a Bank

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  

 

 23
 

 

	
  

  	
  SUNTRUST BANK,
  as a Bank

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  

 

 24
 

The undersigned has duly executed this Amended
and Restated Credit Agreement solely to amend and restate the Amended and
Restated Credit Agreement dated as of June 29, 2006 among Cinergy Corp. and the
other Borrowers listed therein, the Banks listed therein, Barclays Bank PLC, as
Administrative Agent and JPMorgan Chase Bank, N.A., as Syndication Agent. 
The undersigned is not a party to this Amended and Restated Credit
Agreement, and will have no rights or obligations under it.

	
  

  	
  CINERGY
  CORP.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Name:

  	
  Lynn J. Good

  
	
   

  	
   

  	
  Title:

  	
  Vice President and Treasurer

  

 

 25
 

COMMITMENT SCHEDULE

	
  Bank

  	
   

  	
   

  	
   

  	
  Commitment

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  JPMorgan Chase Bank,
  National Association

  	
   

  	
  $

  	
  200,000,000.00

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Wachovia Bank, National
  Association

  	
   

  	
  $

  	
  200,000,000.00

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Bank of America, N.A.

  	
   

  	
  $

  	
  200,000,000.00

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Barclays Bank, PLC

  	
   

  	
  $

  	
  200,000,000.00

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Citibank, N.A.

  	
   

  	
  $

  	
  200,000,000.00

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  The Bank of
  Tokyo-Mitsubishi UFJ, Ltd., New York Branch

  	
   

  	
  $

  	
  200,000,000.00

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Credit Suisse

  	
   

  	
  $

  	
  200,000,000.00

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  ABN AMRO Bank, N.V.

  	
   

  	
  $

  	
  100,000,000.00

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  The Bank of New York

  	
   

  	
  $

  	
  100,000,000.00

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Deutsche Bank AG New
  York Branch

  	
   

  	
  $

  	
  100,000,000.00

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  William Street
  Commitment Corporation

  	
   

  	
  $

  	
  100,000,000.00

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  KeyBank National
  Association

  	
   

  	
  $

  	
  100,000,000.00

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Lehman Brothers Bank,
  FSB

  	
   

  	
  $

  	
  100,000,000.00

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Merrill Lynch Bank USA

  	
   

  	
  $

  	
  100,000,000.00

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Morgan Stanley Bank

  	
   

  	
  $

  	
  100,000,000.00

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  The Royal Bank of
  Scotland plc, New York Branch

  	
   

  	
  $

  	
  100,000,000.00

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  UBS Loan Finance LLC

  	
   

  	
  $

  	
  100,000,000.00

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  The Bank of Nova Scotia

  	
   

  	
  $

  	
  50,000,000.00

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  BNP Paribas

  	
   

  	
  $

  	
  50,000,000.00

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Dresdner Bank AG

  	
   

  	
  $

  	
  50,000,000.00

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  The Northern Trust
  Company

  	
   

  	
  $

  	
  50,000,000.00

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  SunTrust Bank

  	
   

  	
  $

  	
  50,000,000.00

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Total

  	
   

  	
  $

  	
  2,650,000,000.00

  	
   

  

 

 26

Pricing Schedule

Each of “Applicable Margin” and “Facility Fee Rate”
means, for any date, the rate set forth below in the applicable row and column
corresponding to the credit rating of the applicable Borrower and the
applicable Utilization that exist on such date:

(basis points per annum)

	
  Borrower’s Credit Rating

  	
   

  	
  at least A

  by S&P or

  A2 by

  Moody’s

  	
   

  	
  at least A-

  by S&P or

  A3 by

  Moody’s

  	
   

  	
  at least

  BBB+ by

  S&P or

  Baa1 by

  Moody’s

  	
   

  	
  at least

  BBB by

  S&P or

  Baa2 by

  Moody’s

  	
   

  	
  at least

  BBB- by

  S&P or

  Baa3 by

  Moody’s

  	
   

  	
  less than BBB-

  by S&P and

  less than Baa3

  by Moody’s

  	
   

  
	
  Facility Fee Rate

  	
   

  	
  5.0

  	
   

  	
  6.0

  	
   

  	
  7.0

  	
   

  	
  9.0

  	
   

  	
  11.0

  	
   

  	
  15.0

  	
   

  
	
  Applicable Margin

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Utilization**
  ≤ 50%

  	
   

  	
  15.0

  	
   

  	
  19.0

  	
   

  	
  23.0

  	
   

  	
  31.0

  	
   

  	
  44.0

  	
   

  	
  55.0

  	
   

  
	
  Utilization **> 50%

  	
   

  	
  20.0

  	
   

  	
  24.0

  	
   

  	
  28.0

  	
   

  	
  36.0

  	
   

  	
  49.0

  	
   

  	
  60.0

  	
   

  

 

The
Applicable Margin for any Term Loan shall equal the sum of (i) the rate that
would otherwise be in effect based upon the table above and (ii) 12.5 basis
points.

The
“Utilization” applicable to any
Borrower at any date is the percentage equivalent of a fraction the numerator
of which is the sum of (i) the aggregate outstanding principal amount of the
Loans to such Borrower determined at such date after giving effect, if one or
more Loans are being made at such time, to any substantially concurrent application
of the proceeds thereof to repay one or more other Loans plus (ii) the
aggregate amount of the Letter of Credit Liabilities of all Banks for the
account of such Borrower at such date and the denominator of which is such
Borrower’s Sublimit at such date. If for any reason any such Loans or Letter of
Credit Liabilities remain outstanding following termination of the Commitments
either in their entirety or with respect to such Borrower or following the
reduction of the Sublimit of such Borrower to zero, its Utilization will be
deemed to be 100%.

Each
Borrower must obtain a long-term unsecured credit rating from two leading
rating agencies, to include at a minimum either Standard & Poor’s, a
division of the McGraw-Hill Companies, together with its successors (“S&P”),
or Moody’s Investors Service (“Moody’s”), or if such a credit
rating is not available, then a corporate credit rating from S&P or an
issuer rating from Moody’s, and formally notify the Administrative Agent of the
current ratings.  The Facility Fee Rate
and Applicable Margin applicable to each Borrower will be based upon such
Borrower’s credit rating.  The ratings in
effect for any day are those in effect at 

the close of business on such day.  A change in credit rating will result in an
immediate change in the applicable pricing. 
In the case of split ratings from S&P and Moody’s, the rating to be
used to determine the applicable pricing will be the higher of the two; provided that if the rating differential is more than one
notch, the applicable pricing will be based on a rating one notch lower than
the higher of the two.

 2
 

SCHEDULE 1.01 - EXISTING LETTERS OF
CREDIT

	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Issuing
  Bank

  	
   

  	
  Amount
  of

  	
   

  	
  Expiration

  	
   

  	
  Borrower

  	
   

  	
  L/C

  
	
   

  	
   

  	
  L/C

  	
   

  	
  Date

  	
   

  	
   

  	
   

  	
  Number

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   Barclays Bank PLC

  	
   

  	
  $1,000,000.00

  	
   

  	
  12/31/07

  	
   

  	
  Cinergy Corp.

  	
   

  	
  SB00001

  
	
   Barclays Bank PLC

  	
   

  	
  $100,000.00

  	
   

  	
  12/31/07

  	
   

  	
  Cinergy Corp. on behalf of Cinergy Capital + Trading

  	
   

  	
  SB01032

  
	
   Barclays Bank PLC

  	
   

  	
  $25,000.00

  	
   

  	
  12/31/07

  	
   

  	
  Cinergy Corp. on behalf of Cinergy Services Inc.

  	
   

  	
  SB01034

  
	
   Barclays Bank PLC

  	
   

  	
  $25,000.00

  	
   

  	
  12/31/07

  	
   

  	
  Cinergy Corp. on behalf of CinCap V, LLC

  	
   

  	
  SB01033

  
	
   Barclays Bank PLC

  	
   

  	
  $300,000.00

  	
   

  	
  12/31/07

  	
   

  	
  Cinergy Corp. on behalf of CinCap V, LLC

  	
   

  	
  SB01031

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Total:

  	
   

  	
  $1,450,000.00

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  JPMorgan Chase
  Bank, N.A.

  	
   

  	
  $4,007,222.32

  	
   

  	
  12/01/07

  	
   

  	
  Duke Energy Corp.

  	
   

  	
  P-210408

  
	
  JPMorgan Chase
  Bank, N.A.

  	
   

  	
  $250,000.00

  	
   

  	
  12/15/07

  	
   

  	
  Duke Energy Corp.

  	
   

  	
  P-206072

  
	
  JPMorgan Chase
  Bank, N.A.

  	
   

  	
  $985,328.13

  	
   

  	
  01/07/08

  	
   

  	
  Duke Energy Corp.

  	
   

  	
  P-220992

  
	
  JPMorgan Chase
  Bank, N.A.

  	
   

  	
  $16,500.00

  	
   

  	
  06/05/07

  	
   

  	
  Duke Energy Corp.

  	
   

  	
  P-214336

  
	
  Wachovia Bank,
  N.A.

  	
   

  	
  $570,000.00

  	
   

  	
  10/01/07

  	
   

  	
  Duke Energy Corp.

  	
   

  	
  SM222278W

  
	
  Wachovia Bank,
  N.A.

  	
   

  	
  $2,622,000.00

  	
   

  	
  08/31/07

  	
   

  	
  Duke Energy Corp.

  	
   

  	
  SM204493W

  
	
  Wachovia Bank,
  N.A.

  	
   

  	
  $0.00

  	
   

  	
  09/30/07

  	
   

  	
  Duke Energy Corp.

  	
   

  	
  SM204839W

  
	
  Wachovia Bank,
  N.A.

  	
   

  	
  $272,000.00

  	
   

  	
  05/23/08

  	
   

  	
  Duke Energy Corp.

  	
   

  	
  SM211026W

  
	
  Wachovia Bank,
  N.A.

  	
   

  	
  $521,000.00

  	
   

  	
  9/1/2007

  	
   

  	
  Duke Energy Corp.

  	
   

  	
  SM215404W

  
	
  Wachovia Bank,
  N.A.

  	
   

  	
  $75,000.00

  	
   

  	
  9/27/2007

  	
   

  	
  Duke Energy Corp.

  	
   

  	
  LC968-131011

  
	
  Wachovia Bank,
  N.A.

  	
   

  	
  $3,149,500.00

  	
   

  	
  5/18/2008

  	
   

  	
  Duke Energy Corp.

  	
   

  	
  SM225924W

  
	
  Wachovia Bank,
  N.A.

  	
   

  	
  $2,600,000.00

  	
   

  	
  1/31/2008

  	
   

  	
  Duke Energy Corp.

  	
   

  	
  SM218102W

  

 

 3
 

 

	
  Wachovia Bank,
  N.A.

  	
   

  	
  $30,000.00

  	
   

  	
  10/09/07

  	
   

  	
  Duke Energy Corp.

  	
   

  	
  SM202061W

  
	
  Wachovia Bank,
  N.A.

  	
   

  	
  $10,000.00

  	
   

  	
  04/19/08

  	
   

  	
  Duke Energy Corp.

  	
   

  	
  SM207431W

  
	
  Wachovia Bank,
  N.A.

  	
   

  	
  $75,000.00

  	
   

  	
  03/21/08

  	
   

  	
  Duke Energy Corp.

  	
   

  	
  SM218754W

  
	
  Wachovia Bank,
  N.A.

  	
   

  	
  $1,552,887.00

  	
   

  	
  07/31/07

  	
   

  	
  Duke Energy Corp.

  	
   

  	
  SM211136W

  
	
  Wachovia Bank,
  N.A.

  	
   

  	
  $463,373.99

  	
   

  	
  09/30/07

  	
   

  	
  Duke Energy Corp.

  	
   

  	
  SM204906W

  
	
  Wachovia Bank,
  N.A.

  	
   

  	
  $7,625,402.50

  	
   

  	
  06/01/08

  	
   

  	
  Duke Energy Corp.

  	
   

  	
  SM213329W

  
	
  Wachovia Bank,
  N.A.

  	
   

  	
  $16,500,000.00

  	
   

  	
  01/03/08

  	
   

  	
  Duke Energy Corp.

  	
   

  	
  SM201544W

  
	
  Wachovia Bank,
  N.A.

  	
   

  	
  $3,025,000.00

  	
   

  	
  06/28/08

  	
   

  	
  Duke Energy Corp.

  	
   

  	
  SM214407W

  
	
  Wachovia Bank,
  N.A.

  	
   

  	
  $0.00

  	
   

  	
  06/01/07

  	
   

  	
  Duke Energy Corp.

  	
   

  	
  SM213611W

  
	
  Wachovia Bank,
  N.A.

  	
   

  	
  $112,500.00

  	
   

  	
  01/02/08

  	
   

  	
  Duke Energy Corp.

  	
   

  	
  SM206350W

  
	
  Wachovia Bank,
  N.A.

  	
   

  	
  $255,000.00

  	
   

  	
  04/19/08

  	
   

  	
  Duke Energy Corp.

  	
   

  	
  SM212235W

  
	
  Wachovia Bank,
  N.A.

  	
   

  	
  $139,420.00

  	
   

  	
  05/05/08

  	
   

  	
  Duke Energy Corp.

  	
   

  	
  LC968-121173

  
	
  Wachovia Bank,
  N.A.

  	
   

  	
  $25,000.00

  	
   

  	
  5/31/2008

  	
   

  	
  Duke Energy Corp.

  	
   

  	
  SM214420W

  
	
  Wachovia Bank,
  N.A.

  	
   

  	
  $1,100,000.00

  	
   

  	
  10/31/2007

  	
   

  	
  Duke Energy Corp.

  	
   

  	
  SM218400W

  
	
  Wachovia Bank,
  N.A.

  	
   

  	
  $2,131,400.00

  	
   

  	
  12/7/2007

  	
   

  	
  Duke Energy Corp.

  	
   

  	
  SM219114W

  
	
  Wachovia Bank,
  N.A.

  	
   

  	
  $0.00

  	
   

  	
  5/25/2007

  	
   

  	
  Duke Energy Corp.

  	
   

  	
  SM223451W

  
	
  Wachovia Bank,
  N.A.

  	
   

  	
  $500,809.00

  	
   

  	
  1/15/2008

  	
   

  	
  Duke Energy Corp.

  	
   

  	
  SM223856W

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Total:

  	
   

  	
  $48,614,342.94

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Wachovia Bank,
  N.A.

  	
   

  	
  $3,520,000.00

  	
   

  	
  10/10/07

  	
   

  	
  Duke Energy Carolinas, LLC

  	
   

  	
  SM222414W

  
	
  Wachovia Bank,
  N.A.

  	
   

  	
  $415,000.00

  	
   

  	
  04/01/08

  	
   

  	
  Duke Energy Carolinas, LLC

  	
   

  	
  SM207518W

  
	
  Wachovia Bank,
  N.A.

  	
   

  	
  $1,750,000.00

  	
   

  	
  7/5/2008

  	
   

  	
  Duke Energy Carolinas, LLC

  	
   

  	
  LC968-129556

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Total:

  	
   

  	
  $5,685,000.00

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  

 

 

 4

EXHIBIT
A

NOTE

New York, New York

                   ,
20   

For value
received, [Duke Energy Corporation., a Delaware corporation] [Duke Energy
Carolinas, LLC, a North Carolina limited liability company] [Duke Energy Ohio,
Inc., a Ohio corporation] [Duke Energy Indiana, Inc., an Indiana corporation]
[Duke Energy Kentucky, Inc., a Kentucky corporation] (the “Borrower”), promises to pay to the order
of                                 (the “Bank”), for the account of its Applicable
Lending Office, the unpaid principal amount of each Loan made by the Bank to
the Borrower pursuant to the Credit Agreement referred to below on the date
specified in the Credit Agreement.  The
Borrower promises to pay interest on the unpaid principal amount of each such
Loan on the dates and at the rate or rates provided for in the Credit
Agreement.  All such payments of
principal and interest shall be made in lawful money of the United States in
Federal or other immediately available funds at the office of Wachovia Bank,
National Association, Charlotte Plaza, 201 S. College Street, CP-8, NC-0680,
Charlotte, North Carolina 28288-0680.

All
Loans made by the Bank, the respective types and maturities thereof and all
repayments of the principal thereof shall be recorded by the Bank, and the
Bank, if the Bank so elects in connection with any transfer or enforcement of
its Note, may endorse on the schedule attached hereto appropriate notations to
evidence the foregoing information with respect to the Loans then outstanding; provided that the failure of the Bank to
make any such recordation or endorsement shall not affect the obligations of
the Borrower hereunder or under the Credit Agreement.

This
note is one of the Notes referred to in the Amended and Restated Credit
Agreement dated as of June 28, 2007 among Duke Energy Corporation, Duke Energy
Carolinas, LLC, Duke Energy Ohio, Inc., Duke Energy Indiana, Inc., Duke Energy
Kentucky, Inc., the banks listed on the signature pages thereof, Wachovia Bank,
National Association, as Administrative Agent, and the other Agents party
thereto (as the same may be amended from time to time, the “Credit Agreement”).  Terms defined in the Credit Agreement are
used herein with the same meanings. 
Reference is made to the Credit Agreement for provisions for the
prepayment hereof and the acceleration of the maturity hereof.

 5
 

 

	
  

  	
   

  	
  [DUKE ENERGY CORPORATION]

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  [DUKE ENERGY CAROLINAS, LLC]

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  [DUKE ENERGY OHIO, INC]

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  [DUKE ENERGY INDIANA, INC.]

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  [DUKE ENERGY KENTUCKY, INC.]

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Title:

  

 

 

 6
 

Note (cont’d)

LOANS AND PAYMENTS OF
PRINCIPAL

 

	
  Date

  	
   

  	
  Amount

  of

  Loan

  	
   

  	
  Type

  of Loan

  	
   

  	
  Amount of

  Principal

  Repaid

  	
   

  	
  Maturity

  Date

  	
   

  	
  Notation

  Made By

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  

 

 

 7

EXHIBIT
B-1

OPINION
OF INTERNAL COUNSEL OF THE BORROWER

[Effective
Date]

To the Banks and the
Administrative Agent

Referred to Below

c/o Wachovia Bank,
National Association

as Administrative Agent

Charlotte Plaza

201 S. College Street

CP-8, NC-0680

Charlotte, NC  28288-0680

Attn:     Syndication Agency Services

Ladies and Gentlemen:

I
am [title of internal counsel] of [Duke Energy Corporation] [Duke Energy
Carolinas, LLC] [Duke Energy Ohio, Inc.] [Duke Energy Indiana, Inc.] [Duke
Energy Kentucky, Inc.] (the “Borrower”)
and have acted as its counsel in connection with the Amended and Restated
Credit Agreement (the “Credit Agreement”),
dated as of June 28, 2007, among Duke Energy Corporation, Duke Energy
Carolinas, LLC, Duke Energy Ohio, Inc., Duke Energy Indiana, Inc., Duke Energy
Kentucky, Inc. (the “Borrowers”),
the banks listed on the signature pages thereof, Wachovia Bank, National
Association, as Administrative Agent, and the other Agents party thereto.  Capitalized terms defined in the Credit
Agreement are used herein as therein defined. 
This opinion letter is being delivered pursuant to Section 3.01(b) of
the Credit Agreement.

In
such capacity, I or attorneys under my direct supervision have examined
originals or copies, certified or otherwise identified to my satisfaction, of
such documents, corporate records, certificates of public officials and other
instruments and have conducted such other investigations of fact and law as I
have deemed necessary or advisable for purposes of this opinion.

Upon
the basis of the foregoing, I am of the opinion that:

1.             The Borrower is [a Delaware
corporation] [a North Carolina limited liability company] [an Ohio corporation]
[an Indiana corporation] [a 

Kentucky corporation], validly existing and in good
standing under the laws of [Delaware] [North Carolina] [Ohio] [Indiana]
[Kentucky].

2.             The execution, delivery and
performance by the Borrower of the Credit Agreement and any Notes are within
the Borrower’s corporate powers, have been duly authorized by all necessary corporate
action, require no action by or in respect of, or filing with, any governmental
body, agency or official (except for [list exceptions], which have been
obtained or made, as the case may be, and are in full force and effect) and do
not contravene, or constitute a default under, any provision of applicable law
or regulation or of the articles of incorporation or by-laws of the Borrower
or, to my knowledge, of any agreement, judgment, injunction, order, decree or
other instrument binding upon the Borrower or, to my knowledge, result in the
creation or imposition of any Lien on any asset of the Borrower or any of its
Material Subsidiaries.

3.             The Credit Agreement and any Notes
executed and delivered as of the date hereof have been duly executed and delivered
by the Borrower.

4.             Except as disclosed in the
Borrower’s annual report on Form 10-K for the fiscal year ended December 31,
2006 and its quarterly report on Form 10-Q for the period ended March 31, 2007,
to my knowledge (but without independent investigation), there is no action,
suit or proceeding pending or threatened against or affecting, the Borrower or
any of its Subsidiaries before any court or arbitrator or any governmental
body, agency or official, which would be likely to be decided adversely to the
Borrower or such Subsidiary and, as a result, to have a material adverse effect
upon the business, consolidated financial position or consolidated results of
operations of the Borrower and its Consolidated Subsidiaries, considered as a
whole, or which in any manner draws into question the validity of the Credit
Agreement or any Notes.

The
phrase “to my knowledge”, as used in the foregoing opinion, refers to my actual
knowledge without any independent investigation as to any such matters.

I
am a member of the Bar of the State of [Delaware] [North Carolina] [Ohio]
[Indiana] [Kentucky] and do not express any opinion herein concerning any law
other than the law of the State of [Delaware] [North Carolina] [Ohio] [Indiana]
[Kentucky] and the federal law of the United States of America.

The
opinions expressed herein are limited to the matters expressly stated herein,
and no opinion is to be inferred or may be implied beyond the matters expressly
so stated.  This opinion is rendered to
you in connection with the above-referenced matter and may not be relied upon
by you for any other purpose, or relied upon by, or furnished to, any other
Person, firm or corporation without my prior written consent, except for
Additional Banks and Assignees.  My
opinions expressed herein are as of the date hereof, and I undertake no
obligation to advise you of any changes of applicable law or any other matters
that may come to my attention after the date hereof that may affect my opinions
expressed herein.

Very truly yours,

 

 

 2

EXHIBIT B-2

OPINION
OF

ROBINSON, BRADSHAW & HINSON, P.A.,

SPECIAL COUNSEL FOR THE BORROWER

[Effective
Date]

To the Banks and the
Administrative Agent

Referred to Below

c/o Wachovia Bank,
National Association

as Administrative Agent

Charlotte Plaza

201 S. College Street

CP-8, NC-0680

Charlotte, NC  28288-0680

Attn:     Syndication Agency Services

Ladies and Gentlemen:

We
have acted as counsel to  [Duke Energy
Corporation., a Delaware corporation] [Duke Energy Carolinas, LLC, a North
Carolina limited liability company] [Duke Energy Ohio, Inc., a Ohio
corporation] [Duke Energy Indiana, Inc., an Indiana corporation] [Duke Energy
Kentucky, Inc., a Kentucky corporation] (the “Borrower”),
in connection with the Amended and Restated Credit Agreement (the “Credit Agreement”), dated as of June 28,
2007, among Duke Energy Corporation, Duke Energy Carolinas, LLC, Duke Energy
Ohio, Inc., Duke Energy Indiana, Inc., Duke Energy Kentucky, Inc. (the “Borrowers”), the banks listed on the signature pages
thereof, Wachovia Bank, National Association, as Administrative Agent, and the
other Agents party thereto.  Capitalized
terms used herein and not defined shall have the meanings given to them in the
Credit Agreement.  This opinion letter is
being delivered pursuant to Section 3.01(b) of the Credit Agreement.

In
connection with this opinion, we also examined originals, or copies identified
to our satisfaction, of such other documents and considered such matters of law
and fact as we, in our professional judgment, have deemed appropriate to render
the opinions contained herein.  Where we
have considered it appropriate, as to certain facts we have relied, without
investigation or analysis of any underlying data contained therein, upon
certificates or other comparable 

documents of public officials and officers or other
appropriate representatives of the Borrower.

In
rendering the opinions contained herein, we have assumed, among other things,
that the Credit Agreement and any Notes to be executed (i) are within the
Borrower’s corporate powers, (ii) have been duly authorized by all necessary
corporate action, (iii) have been duly executed and delivered, (iv) require no
action by or in respect of, or filing with, any governmental body, agency of
official and (v) do not contravene, or constitute a default under, any
provision of applicable law or regulation or of the Borrower’s certificate of
incorporation or by-laws or any agreement, judgment, injunction, order, decree
or other instrument binding upon the Borrower or result in the creation or
imposition of any Lien on any asset of the Borrower.  In addition, we have assumed that the Credit
Agreement fully states the agreement between the Borrower and the Banks with
respect to the matters addressed therein, and that the Credit Agreement constitutes
a legal, valid and binding obligation of each Bank, enforceable in accordance
with its respective terms.

The
opinions set forth herein are limited to matters governed by the laws of the
State of North Carolina and the federal laws of the United States, and no
opinion is expressed herein as to the laws of any other jurisdiction.  For purposes of our opinions, we have
disregarded the choice of law provisions in the Credit Agreement and, instead,
have assumed with your permission that the Credit Agreement and the Notes are
governed exclusively by the internal, substantive laws and judicial
interpretations of the State of North Carolina. 
We express no opinion concerning any matter respecting or affected by
any laws other than laws that a lawyer in North Carolina exercising customary
professional diligence would reasonably recognize as being directly applicable
to the Borrower, the Loans, or any of them.

Based
upon and subject to the foregoing and the further limitations and
qualifications hereinafter expressed, it is our opinion that the Credit
Agreement constitutes the legal, valid and binding obligation of the Borrower
and the Notes, if and when issued, will constitute legal, valid and binding
obligations of the Borrower, in each case, enforceable against the Borrower in
accordance with its terms.

The
opinions expressed above are subject to the following qualifications and
limitations:

1.
            Enforcement of the Credit
Agreement and the Notes is subject to the effect of applicable bankruptcy,
insolvency, reorganization, fraudulent conveyance, moratorium and similar laws
affecting the enforcement of creditors’ rights generally.

 2
 

2.             Enforcement of the Credit Agreement
and the Notes is subject to the effect of general principles of equity
(regardless of whether considered in a proceeding in equity or at law) by which
a court with proper jurisdiction may deny rights of specific performance,
injunction, self-help, possessory remedies or other remedies.

3.             We do not express any opinion as to
the enforceability of any provisions contained in the Credit Agreement or any
Note that (i) purport to excuse a party for liability for its own acts,
(ii) purport to make void any act done in contravention thereof,
(iii) purport to authorize a party to act in its sole discretion,
(iv) require waivers or amendments to be made only in writing,
(v) purport to effect waivers of constitutional, statutory or equitable
rights or the effect of applicable laws, (vi) impose liquidated damages,
penalties or forfeiture, or (vii) purport to indemnify a party for its own
negligence or willful misconduct. 
Indemnification provisions in the Credit Agreement are subject to and
may be rendered unenforceable by applicable law or public policy, including
applicable securities law.

4.             We do not express any opinion as to
the enforceability of any provisions contained in the Credit Agreement or the
Notes purporting to require a party thereto to pay or reimburse attorneys’ fees
incurred by another party, or to indemnify another party therefor, which may be
limited by applicable statutes and decisions relating to the collection and
award of attorneys’ fees, including but not limited to North Carolina General
Statutes § 6-21.2.

5.             We do not express any opinion as to
the enforceability of any provisions contained in the Credit Agreement
purporting to waive the right of jury trial. 
Under North Carolina General Statutes § 22B-10, a provision for the
waiver of the right to a jury trial is unconscionable and unenforceable.

6.             We do not express any opinion as to
the enforceability of any provisions contained in the Credit Agreement
concerning choice of forum or consent to the jurisdiction of courts, venue of
actions or means of service of process.

7.             It is likely that North Carolina
courts will enforce the provisions of the Credit Agreement providing for
interest at a higher rate resulting from a Default or Event of Default
(a ”Default Rate”) which rate
is higher than the rate otherwise stipulated in the Credit Agreement.  The law, however, disfavors penalties, and it
is possible that interest at the Default Rate may be held to be an
unenforceable penalty, to the extent such rate exceeds the rate applicable
prior to a default under the Credit Agreement. 
Also, since North Carolina General Statutes § 24-10.1 expressly
provides for late charges, it is possible that North Carolina courts, when
faced specifically with the issue, might rule that this statutory late charge
preempts any other charge (such as default interest) by a 

 3
 

bank for delinquent payments.  The only North Carolina case which we have
found that addresses this issue is a 1978 Court of Appeals decision, which in
our opinion is of limited precedential value, North
Carolina National Bank v. Burnette, 38 N.C. App. 120, 247 S.E.2d 648
(1978), rev’d on other grounds,
297 N.C. 524, 256 S.E.2d 388 (1979). 
While the court in that case did allow interest after default
(commencing with the date requested in the complaint) at a rate six percent in
excess of pre-default interest, we are unable to determine from the opinion
that any question was raised as to this being penal in nature, nor does the
court address the possible question of the statutory late charge preempting a
default interest surcharge.  Therefore,
since the North Carolina Supreme Court has not ruled in a properly presented
case raising issues of its possible penal nature and those of North Carolina
General Statutes § 24-10.1, we are unwilling to express an unqualified
opinion that the Default Rate of interest prescribed in the Credit Agreement is
enforceable.

8.             We do not express any opinion as to
the enforceability of any provisions contained in the Credit Agreement relating
to evidentiary standards or other standards by which the Credit Agreement are
to be construed.

This
opinion letter is delivered solely for your benefit in connection with the
Credit Agreement and, except for any Additional Bank or any Assignee which
becomes a Bank pursuant to Section 2.17 or 9.06(c) of the Credit Agreement, may
not be used or relied upon by any other Person or for any other purpose without
our prior written consent in each instance. 
Our opinions expressed herein are as of the date hereof, and we
undertake no obligation to advise you of any changes of applicable law or any
other matters that may come to our attention after the date hereof that may
affect our opinions expressed herein.

Very truly yours,

 

 

 

 4

EXHIBIT C

OPINION
OF

DAVIS POLK & WARDWELL, SPECIAL COUNSEL

              FOR
THE
AGENTS             

[Effective
Date]

To the Banks and the Administrative Agent
                 Referred to Below

 

c/o Wachovia Bank,
National Association
         as Administrative Agent

Charlotte Plaza

201 S. College Street

CP-8, NC-0680

Charlotte, NC  28288-0680

Attn:       Syndication Agency Services

Dear Sirs:

We
have participated in the preparation of the Amended and Restated Credit
Agreement (the “Credit Agreement”)
dated as of June 28, 2007 among Duke Energy Corporation, a Delaware
corporation, Duke Energy Carolinas, LLC, a North Carolina limited liability
company, Duke Energy Ohio, Inc. a Ohio corporation, Duke Energy Indiana, Inc.,
an Indiana corporation and Duke Energy Kentucky, Inc., a Kentucky corporation
(the “Borrowers”, each
individually, a “Borrower”), the banks listed on
the signature pages thereof (the “Banks”),
Wachovia Bank, National Association, as Administrative Agent (the “Administrative Agent”), and the other
Agents party thereto, and have acted as special counsel for the Agents for the
purpose of rendering this opinion pursuant to Section 3.01(c)of the Credit
Agreement.  Terms defined in the Credit
Agreement are used herein as therein defined.

We
have examined originals or copies, certified or otherwise identified to our
satisfaction, of such documents, corporate records, certificates of public
officials and other instruments and have conducted such other investigations of
fact and law as we have deemed necessary or advisable for purposes of this
opinion.

In
rendering the opinion contained herein, we have assumed, among other things,
that the Credit Agreement and any Notes to be executed (i) are within each 

Borrower’s corporate powers, (ii) have been duly
authorized by all necessary corporate action, (iii) have been duly executed and
delivered, (iv) require no action by or in respect of, or filing with, any
governmental body, agency of official and (v) do not contravene, or constitute
a default under, any provision of applicable law or regulation or of any
Borrower’s certificate of incorporation or by-laws or any agreement, judgment,
injunction, order, decree or other instrument binding upon any Borrower or
result in the creation or imposition of any Lien on any asset of any Borrower.

Upon
the basis of the foregoing, we are of the opinion that the Credit Agreement
constitutes a valid and binding agreement of each Borrower and the Notes, if
and when issued by a Borrower, constitute valid and binding obligations of such
Borrower enforceable in accordance with their respective terms, except as the
same may be limited by bankruptcy, insolvency or similar laws affecting
creditors’ rights generally and by general principles of equity.

In
giving the foregoing opinion, we express no opinion as to the effect (if any)
of any law of any jurisdiction (except the State of New York) in which any Bank
is located which limits the rate of interest that such Bank may charge or
collect.

This
opinion is rendered solely to you in connection with the above matter.  This opinion may not be relied upon by you
for any other purpose or relied upon by or furnished to any other person, firm
or corporation without our prior written consent, except for Additional Banks
and all Participants.

Very truly yours,

 

 

 2

 

EXHIBIT D

ASSIGNMENT AND ASSUMPTION
AGREEMENT

AGREEMENT
dated as of              ,
20    among [ASSIGNOR] (the “Assignor”),
[ASSIGNEE] (the “Assignee”), [DUKE
ENERGY CORPORATION] and WACHOVIA BANK, NATIONAL ASSOCIATION, as Administrative
Agent (the “Administrative Agent”).

W
I  T  N  E  S
S  E  T  H

WHEREAS,
this Assignment and Assumption Agreement (the “Agreement”) relates to the Amended and Restated Credit
Agreement dated as of June 28, 2007 among Duke Energy Corporation, Duke Energy
Carolinas, LLC, Duke Energy Ohio, Inc., Duke Energy Indiana, Inc., and Duke
Energy Kentucky, Inc. (the “Borrowers”,
each individually, a “Borrower”), the
Assignor and the other Banks party thereto, as Banks, the Administrative Agent
and the other Agents party thereto (the “Credit
Agreement”);

WHEREAS,
as provided under the Credit Agreement, the Assignor has a Commitment to make
Loans to the Borrowers and participate in Letters of Credit in an aggregate
principal amount at any time outstanding not to exceed $                    ;(1)

WHEREAS,
Loans made to the Borrowers by the Assignor under the Credit Agreement in the
aggregate principal amount of $              
are outstanding at the date hereof;

WHEREAS,
Letters of Credit with a total amount available for drawing thereunder of $                 
are outstanding at the date hereof; and

WHEREAS,
the Assignor proposes to assign to the Assignee all of the rights of the
Assignor under the Credit Agreement in respect of a portion of its Commitment
thereunder in an amount equal to $               
(the “Assigned Amount”), together
with a corresponding portion of its outstanding Loans and Letter of Credit
Liabilities, and the Assignee proposes to accept assignment of such rights and
assume the corresponding obligations from the Assignor on such terms;*

NOW,
THEREFORE, in consideration of the foregoing and the mutual agreements
contained herein, the parties hereto agree as follows:

 

(1)The
asterisked provisions shall be appropriately revised in the event of an
assignment after the Commitment Termination Date.

 

SECTION 1. 
Definitions.  All capitalized terms not otherwise defined
herein shall have the respective meanings set forth in the Credit Agreement.

SECTION 2. 
Assignment.  The Assignor hereby assigns and sells to the
Assignee all of the rights of the Assignor under the Credit Agreement to the
extent of the Assigned Amount, and the Assignee hereby accepts such assignment
from the Assignor and assumes all of the obligations of the Assignor under the
Credit Agreement to the extent of the Assigned Amount, including the purchase
from the Assignor of the corresponding portion of the principal amount of the
Loans made by, and Letter of Credit Liabilities of, the Assignor outstanding at
the date hereof.  Upon the execution and
delivery hereof by the Assignor, the Assignee [, Duke Energy Corporation] [,
the Issuing Banks] and the Administrative Agent, the payment of the amounts
specified in Section 3 required to be paid on the date hereof (i) the Assignee
shall, as of the date hereof, succeed to the rights and be obligated to perform
the obligations of a Bank under the Credit Agreement with a Commitment in an
amount equal to the Assigned Amount, and (ii) the Commitment of the Assignor
shall, as of the date hereof, be reduced by a like amount and the Assignor
released from its obligations under the Credit Agreement to the extent such
obligations have been assumed by the Assignee. 
The assignment provided for herein shall be without recourse to the
Assignor.

SECTION 3. 
Payments.  As consideration for the assignment and sale
contemplated in Section 2 hereof, the Assignee shall pay to the Assignor on the
date hereof in Federal funds the amount heretofore agreed between them.(2)  It is understood that facility [and Letter of
Credit] fees accrued to the date hereof in respect of the Assigned Amount are
for the account of the Assignor and such fees accruing from and including the
date hereof are for the account of the Assignee.  Each of the Assignor and the Assignee hereby
agrees that if it receives any amount under the Credit Agreement which is for
the account of the other party hereto, it shall receive the same for the
account of such other party to the extent of such other party’s interest
therein and shall promptly pay the same to such other party.

SECTION 4. 
Consent to Assignment.  This Agreement is conditioned upon
the consent of [Duke Energy Corporation,] [the Issuing Banks] and the
Administrative Agent pursuant to Section 9.06(c) of the Credit Agreement.  The execution of this Agreement by [Duke
Energy Corporation,] [the Issuing Banks] and the Administrative Agent is
evidence of this consent.  Pursuant to
Section 9.06(c) each Borrower agrees to execute and deliver a Note, if required
by the 

 

(2)Amount
should combine principal together with accrued interest and breakage
compensation, if any, to be paid by the Assignee.  It may be preferable in an appropriate case
to specify these amounts generically or by formula rather than as a fixed sum.

 2
 

Assignee,
payable to the order of the Assignee to evidence the assignment and assumption
provided for herein.

SECTION 5. 
Non-reliance on Assignor.  The Assignor makes no
representation or warranty in connection with, and shall have no responsibility
with respect to, the solvency, financial condition, or statements of any
Borrower, or the validity and enforceability of the obligations of any Borrower
in respect of the Credit Agreement or any Note. 
The Assignee acknowledges that it has, independently and without
reliance on the Assignor, and based on such documents and information as it has
deemed appropriate, made its own credit analysis and decision to enter into
this Agreement and will continue to be responsible for making its own
independent appraisal of the business, affairs and financial condition of each
Borrower.

SECTION 6. 
Governing Law.  This Agreement shall be governed
by and construed in accordance with the laws of the State of New York.

SECTION 7. 
Counterparts.  This Agreement may be signed in
any number of counterparts, each of which shall be an original, with the same
effect as if the signatures thereto and hereto were upon the same instrument.

SECTION 8. 
Administrative Questionnaire.  Attached is an Administrative
Questionnaire duly completed by the Assignee.

 3
 

 

IN
WITNESS WHEREOF, the parties have caused this Agreement to be executed and
delivered by their duly authorized officers as of the date first above written.

 

	
  

  	
   

  	
   

  	
   

  	
  [ASSIGNOR]

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  Title:

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
  [ASSIGNEE]

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  Title:

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
  [DUKE ENERGY CORPORATION]

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  Title:

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
  WACHOVIA BANK, NATIONAL 

  ASSOCIATION, as Administrative Agent

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  Title:

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  

 

 4

EXHIBIT E

EXTENSION
AGREEMENT

Wachovia Bank,
National Association, as Administrative

Agent under the Credit Agreement referred to below

Charlotte Plaza

201 S. College Street

CP-8, NC-0680

Charlotte, NC  28288-0680

Attn:    
Syndication Agency Services

Ladies and Gentlemen:

Effective
as of [date], the undersigned hereby agrees to extend its Commitment and
Commitment Termination Date under the Amended and Restated Credit Agreement
dated as of June 28, 2007 among Duke Energy Corporation, Duke Energy Carolinas,
LLC, Duke Energy Ohio, Inc., Duke Energy Indiana, Inc., Duke Energy Kentucky
Inc. (the “Borrowers”, each individually, a “Borrower”), the Banks party thereto, Wachovia Bank, National
Association, as Administrative Agent, and the other Agents party thereto  (the “Credit
Agreement”) for one year to [date to which its Commitment
Termination Date is to be extended] pursuant to Section 2.01(c) of the Credit
Agreement. Terms defined in the Credit Agreement are used herein as therein
defined.

This
Extension Agreement shall be construed in accordance with and governed by the
law of the State of New York. This Extension Agreement may be signed in any
number of counterparts, each of which shall be an original, with the same
effect as if the signatures thereto and hereto were upon the same instrument.

 

	
   

  	
  [NAME OF BANK]

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Title:

  

 

Agreed and Accepted:

	
  DUKE ENERGY CORPORATION. 

  as Borrower

  
	
   

  	
   

  
	
   

  	
   

  
	
  By:

  	
   

  	
   

  
	
   

  	
  Title:

  	
   

  

 

	
  DUKE ENERGY CAROLINAS, LLC,

  as Borrower

  
	
   

  	
   

  
	
   

  	
   

  
	
  By:

  	
   

  	
   

  
	
   

  	
  Title:

  	
   

  

 

	
  DUKE ENERGY OHIO, INC.,

  as Borrower

  
	
   

  	
   

  
	
   

  	
   

  
	
  By:

  	
   

  	
   

  
	
   

  	
  Title:

  	
   

  

 

	
  DUKE ENERGY INDIANA, INC.,

  as Borrower

  
	
   

  	
   

  
	
   

  	
   

  
	
  By:

  	
   

  	
   

  
	
   

  	
  Title:

  	
   

  

 

	
  DUKE ENERGY KENTUCKY, INC.,

  as Borrower

  
	
   

  	
   

  
	
   

  	
   

  
	
  By:

  	
   

  	
   

  
	
   

  	
  Title:

  	
   

  

 

 2
 

 

	
  WACHOVIA BANK, NATIONAL ASSOCIATION, 

  as Administrative Agent

  
	
   

  	
   

  
	
   

  	
   

  
	
  By:

  	
   

  	
   

  
	
   

  	
  Title:

  	
   

  

 

 3
 

EXHIBIT F

NOTICE OF ISSUANCE

Date:                        

To:                     Wachovia Bank, National
Association, as Administrative Agent
                            ______________,
as Issuing Bank

From:                 [Duke Energy Corporation] [Duke
Energy Carolinas, LLC] [Duke Energy Ohio, Inc.] [Duke Energy Indiana, Inc.]
[Duke Energy Kentucky, Inc.]

Re:                                                               Amended and Restated Credit Agreement dated as of
June 28, 2007 (as amended from time to time, the “Credit Agreement”) among Duke
Energy Corporation, Duke Energy Carolinas, LLC, Duke Energy Ohio, Inc., Duke
Energy Indiana, Inc., Duke Energy Kentucky, Inc. (the “Borrowers”, each individually, a “Borrower”), the Banks party thereto, Wachovia Bank, National
Association, as Administrative Agent and the other Agents party thereto

[Duke
Energy Corporation] [Duke Energy Carolinas, LLC] [Duke Energy Ohio, Inc.] [Duke
Energy Indiana, Inc.] [Duke Energy Kentucky, Inc.]  hereby
gives notice pursuant to Section 2.15(b) of the Credit Agreement that it
requests the above-named Issuing Bank to issue on or before ________________ a
Letter of Credit containing the terms attached hereto as Schedule I (the “Requested Letter of Credit”).

The
Requested Letter of Credit will be subject to [UCP 500] [ISP98].

[Duke
Energy Corporation] [Duke Energy Carolinas, LLC] [Duke Energy Ohio, Inc.] [Duke
Energy Indiana, Inc.] [Duke Energy Kentucky, Inc.] hereby represents and warrants
to the Issuing Bank, the Administrative Agent and the Banks that:

(a)                                  immediately
after the issuance of the Requested Letter of Credit, (i) the Utilization
Limits are not exceeded and (ii) the aggregate amount of the Letter of Credit
Liabilities shall not exceed $1,000,000,000;

(b)                                 immediately
after the issuance of the Requested Letter of Credit, no Default shall have
occurred and be continuing; and

(c)                                  the
representations and warranties contained in the Credit Agreement (except the
representations and warranties set forth in Section 4.04(c) and 4.06 of the
Credit Agreement) shall be true on and as of the date of issuance of the
Requested Letter of Credit.

 4
 

[Duke
Energy Corporation] [Duke Energy Carolinas, LLC] [Duke Energy Ohio, Inc.] [Duke
Energy Indiana, Inc.] [Duke Energy Kentucky, Inc.] hereby authorizes the
Issuing Bank to issue the Requested Letter of Credit with such variations from
the above terms as the Issuing Bank may, in its discretion, determine are
necessary and are not materially inconsistent with this Notice of
Issuance.  The opening of the Requested
Letter of Credit and [Duke Energy Corporation] [Duke Energy Carolinas, LLC]
[Duke Energy Ohio, Inc.] [Duke Energy Indiana, Inc.] [Duke Energy Kentucky, Inc.]’s
responsibilities with respect thereto are subject to [UCP 500] [ISP98] as
indicated above and the terms and conditions set forth in the Credit Agreement.

Terms
used herein and not otherwise defined herein have the meanings assigned to them
in the Credit Agreement.

	
   

  	
  [DUKE ENERGY CORPORATION]

  
	
   

  	
   

  
	
   

  	
  [DUKE
  ENERGY CAROLINAS, LLC]

  
	
   

  	
   

  
	
   

  	
  [DUKE
  ENERGY OHIO, INC.]

  
	
   

  	
   

  
	
   

  	
  [DUKE
  ENERGY INDIANA, INC.]

  
	
   

  	
   

  
	
   

  	
  [DUKE
  ENERGY KENTUCKY, INC.]

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Title:

  	
   

  
	
   

  	
   

  	
   

  	
   

  

 

 5

SCHEDULE I

Application and
Agreement for 

Irrevocable Standby Letter of Credit

To:  ____________________ (“Bank”)

Please TYPE information
in the fields below.  We reserve the
right to return illegible applications for clarification.

	
  Date:

  	
   

  	
   

  	
   

  	
  The undersigned Applicant hereby requests Bank to
  issue and transmit by:

  q
  Overnight Carrier   q
  Teletransmission   q
  Mail   q
  Other:

  
	
   

  	
   

  	
   

  	
   

  	
  Explain: 

  
	
  L/C No.

  	
   

  	
   

  	
   

  	
  an Irrevocable Standby
  Letter of Credit (the “Credit”) substantially as set forth below. In issuing
  the Credit, Bank is expressly authorized to make such changes from the terms
  herein below set forth as it, in its sole discretion, may deem advisable.

  
	
   

  	
   

  	
  (Bank Use Only)

  	
   

  	
   

  

 

	
  Applicant (Full name &
  address)

  	
   

  	
  Advising Bank (Designate name & address only, if
  desired)

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Beneficiary (Full name
  & address)

  	
   

  	
  Currency and amount in figures:

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Currency and amount in words:

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Expiration Date:

  
	
   

  	
   

  	
   

  
	
  Charges: the Bank’s charges are for our account; all
  other banking charges are to be paid by beneficiary.

  

 

	
  Credit to be available for
  payment against Beneficiary’s draft(s) at sight drawn on Bank or its
  correspondent at Bank’s option accompanied by the following documents:

  
	
  o   Statement, purportedly signed by the
  Beneficiary, reading as follows (please state below exact wording to appear
  on the statement):

  
	
   

  
	
  o   Other Documents

  
	
   

  
	
  o   Special Conditions (including, if Applicant
  has a preference, selection of UCP as herein defined or ISP98 as herein
  defined).

  
	
   

  
	
  o   Issue substantially in form of attached
  specimen. (Specimen must also be signed by applicant.)

  
	
   

  

 

 

	
  Complete only when the
  Beneficiary (Foreign Bank, or other Financial Institution) is to issue its
  undertaking based on this Credit. o Request
  Beneficiary to issue and deliver their (specify type of undertaking)
                  
  in favor of
                  
  for an amount not exceeding the amount specified above, effective immediately
  relative to (specify contract number or other pertinent reference) to expire
  on
                  .
  (This date must be at least 15 days prior to expiry date indicated above.) It
  is understood that if the Credit is issued in favor of any bank or other
  financial or commercial entity which has issued or is to issue an undertaking
  on behalf of the Applicant of the Credit in connection with the Credit, the
  Applicant hereby agrees to remain liable under this Application and Agreement
  in respect of the Credit (even after its stated expiry date) until Bank is
  released by such bank or entity.

  

 

Each Applicant signing below affirms that it has fully
read and agrees to this Application. 
(Note:  If a bank, trust company,
or other financial institution signs as Applicant or joint and several
co-Applicant for its customer, or if two Applicants jointly and severally
apply, both parties sign below.) 
Documents may be forwarded to the Bank by the beneficiary, or the
negotiating bank, in one mail.  Bank may
forward documents to Applicant’s customhouse broker, or Applicant if specified
above, in one mail.  Applicant
understands and agrees that this Credit will be subject to the Uniform Customs
and Practice for Documentary Credits of the International Chamber of Commerce
currently in effect, and in use by Bank (“UCP”) or to the International Standby
Practices of the International Chamber of Commerce, Publication 590 or any
subsequent version currently in effect and in use by Bank (“ISP98”).

	
  (Print or type name of
  Applicant)

  	
   

  	
  (Print or type
  name of Applicant)

  
	
   

  	
   

  	
   

  
	
  (Address)

  	
   

  	
  (Address)

  
	
   

  	
   

  	
   

  
	
  Authorized
  Signature (Title)

  	
   

  	
  Authorized
  Signature (Title)

  
	
   

  	
   

  	
   

  
	
  Authorized Signature
  (Title)

  	
   

  	
  Authorized
  Signature (Title)

  
	
  Customer Contact:

  	
   

  	
  Phone:

  

 

	
  BANK USE ONLY

  NOTE:   Application
  will NOT be processed if this
  section is not complete.

  
	
  Approved (Authorized
  Signature)

  	
  Date:

  
	
   

  	
   

  
	
   

  	
   

  
	
  Approved (Print name
  and title)

  	
  City:

  
	
   

  	
   

  
	
   

  	
   

  
	
  Customer SIC Code:

  	
  Borrower Default Grade:

  	
  Telephone:

  
	
   

  	
   

  	
   

  
	
  Charge DDA#:

  	
  Fee:

  	
  RC #:

  	
  CLAS Bank #:

  	
  CLAS Obligor #:

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Other (please explain):

  
	
   

  
	
   

  
						

 

 2

EXHIBIT
G

APPROVED FORM OF LETTER OF CREDIT

IRREVOCABLE STANDBY LETTER OF CREDIT NO.

BENEFICIARY:

LADIES AND GENTLEMEN:

WE HEREBY ISSUE OUR IRREVOCABLE STANDBY LETTER OF
CREDIT NUMBER                    , IN
FAVOR OF [INSERT BENEFICIARY NAME], BY ORDER AND FOR THE ACCOUNT OF [DUKE
ENERGY CORPORATION] [DUKE ENERGY CAROLINAS, LLC] [DUKE ENERGY OHIO, INC.] [DUKE
ENERGY INDIANA, INC.] [DUKE ENERGY KENTUCKY, INC.], [ON BEHALF OF [INSERT NAME
OF [DUKE ENERGY CORPORATION] [DUKE ENERGY CAROLINAS, LLC] [DUKE ENERGY OHIO,
INC.] [DUKE ENERGY INDIANA, INC.] [DUKE ENERGY KENTUCKY, INC.]’S AFFILIATE OR
SUBSIDIARY],] AT SIGHT FOR UP TO                   U.S. DOLLARS (                         UNITED STATES DOLLARS) AGAINST THE FOLLOWING
DOCUMENTS:

1)            A
BENEFICIARY’S SIGNED CERTIFICATE STATING “[[DUKE ENERGY CORPORATION] [DUKE
ENERGY CAROLINAS, LLC] [DUKE ENERGY OHIO, INC.] [DUKE ENERGY INDIANA, INC.]
[DUKE ENERGY KENTUCKY, INC.]/[INSERT NAME OF [DUKE ENERGY CORPORATION] [DUKE
ENERGY CAROLINAS, LLC] [DUKE ENERGY OHIO, INC.] [DUKE ENERGY INDIANA, INC.]
[DUKE ENERGY KENTUCKY, INC.]’S AFFILIATE OR SUBSIDIARY]] IS IN DEFAULT UNDER
ONE OR MORE AGREEMENTS BETWEEN [[DUKE ENERGY CORPORATION] [DUKE ENERGY
CAROLINAS, LLC] [DUKE ENERGY OHIO, INC.] [DUKE ENERGY INDIANA, INC.] [DUKE
ENERGY KENTUCKY, INC.]/[INSERT NAME OF [DUKE ENERGY CORPORATION] [DUKE ENERGY
CAROLINAS, LLC] [DUKE ENERGY OHIO, INC.] [DUKE ENERGY INDIANA, INC.] [DUKE
ENERGY KENTUCKY, INC.]’S AFFILIATE OR SUBSIDIARY]] AND [INSERT BENEFICIARY’S
NAME].”

OR

2)            A
BENEFICIARY’S SIGNED CERTIFICATE STATING “[INSERT BENEFICIARY’S NAME] HAS
REQUESTED ALTERNATE SECURITY FROM [[DUKE ENERGY CORPORATION] [DUKE ENERGY
CAROLINAS, LLC] [DUKE ENERGY OHIO, INC.] [DUKE ENERGY INDIANA, INC.] [DUKE
ENERGY KENTUCKY, INC.]/[INSERT NAME OF [DUKE ENERGY CORPORATION] [DUKE ENERGY
CAROLINAS, LLC] [DUKE ENERGY OHIO, INC.] [DUKE ENERGY INDIANA, INC.] [DUKE
ENERGY KENTUCKY, INC.]’S AFFILIATE OR SUBSIDIARY]] AND [DUKE ENERGY 

 3
 

CORPORATION] [DUKE ENERGY CAROLINAS, LLC] [DUKE ENERGY
OHIO, INC.] [DUKE ENERGY INDIANA, INC.] [DUKE ENERGY KENTUCKY, INC.]/[INSERT
NAME OF [DUKE ENERGY CORPORATION] [DUKE ENERGY CAROLINAS, LLC] [DUKE ENERGY
OHIO, INC.] [DUKE ENERGY INDIANA, INC.] [DUKE ENERGY KENTUCKY, INC.]’S
AFFILIATE OR SUBSIDIARY]] HAS NOT PROVIDED ALTERNATE SECURITY ACCEPTABLE TO
[INSERT BENEFICIARY’S NAME] AND THIS LETTER OF CREDIT HAS LESS THAN TWENTY DAYS
UNTIL EXPIRY.”

AND

3)            A
DRAFT STATING THE AMOUNT TO BE DRAWN.

SPECIAL CONDITIONS:

1.             PARTIAL
DRAWINGS ARE PERMITTED.

2.             DOCUMENTS
MUST BE PRESENTED AT OUR COUNTER NO LATER THAN                      , WHICH IS THE EXPIRY
DATE OF THIS STANDBY LETTER OF CREDIT.

WE HEREBY ENGAGE WITH YOU THAT ALL DRAFTS DRAWN UNDER
AND IN COMPLIANCE WITH THE TERMS OF THIS CREDIT WILL BE DULY HONORED IF DRAWN
AND PRESENTED FOR PAYMENT AT OUR OFFICE LOCATED AT                                                   
 ON OR BEFORE THE EXPIRY DATE OF
THIS CREDIT.

EXCEPT AS OTHERWISE EXPRESSLY STATED HEREIN, THIS
CREDIT IS SUBJECT TO THE UNIFORM CUSTOMS AND PRACTICE FOR DOCUMENTARY CREDITS,
1993 REVISION, INTERNATIONAL CHAMBER OF COMMERCE PUBLICATION NO. 500.

COMMUNICATIONS WITH RESPECT TO THIS STANDBY LETTER OF
CREDIT SHALL BE IN WRITING AND SHALL BE ADDRESSED TO US AT                                 , SPECIFICALLY
REFERRING TO THE NUMBER OF THIS STANDBY LETTER OF CREDIT.

VERY
TRULY YOURS

[ISSUING BANK]

 4

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