Document:

Form of Stock Option Agreement under the 2007 Equity Incentive Plan

 Exhibit 10.10 
 [FORM FOR EXECUTIVE OFFICERS] 
 EMPHASYS MEDICAL, INC. 
 2007 EQUITY INCENTIVE PLAN 
 NOTICE OF STOCK OPTION GRANT 
  

			
	Address:	 	
	  
	 	
	  
	 	

 You have been granted an option to purchase Common Stock of Stock of Emphasys Medical, Inc. (the
“Company”) under the terms of the Company’s 2007 Equity Incentive Plan (the “Plan”) as follows: 
  

			
	Date of Grant:	  	
		
	Exercise Price per Share:	  	$
		
	Total Number of Shares Granted:	  	
		
	Total Exercise Price:	  	$
		
	Type of Option:	  	         Incentive Stock Option
		
		  	         Nonstatutory Stock Option
		
	Expiration Date:	  	
		
	Vesting Commencement Date:	  	
		
	Vesting/Exercise Schedule:	  	So long as your Continuous Service with the Company continues, the Shares underlying this Option shall vest and become exercisable in accordance with the following schedule:
         of the Shares subject to the Option shall vest and become exercisable on the first anniversary of the Vesting Commencement Date and          of
the total number of Shares subject to the Option shall vest and become exercisable on each month thereafter.
		
		  	Notwithstanding the foregoing, in the event of a Change of Control in which the acquiror (or successor) does not assume the Option or substitute an equivalent option for the Option, the vesting
of the Option shall automatically accelerate with respect to 100% of the shares then unvested immediately prior to the effective time of the Change of Control.

			
		
		  	Notwithstanding the foregoing, in the event that the Option is assumed or an equivalent option is substituted for the Option by an acquiror (or successor) in a Change of Control, following which
your Continuous Service with the Company is Involuntarily Terminated for any reason other than for Cause during the period beginning with the effective date of a Change of Control (as defined below) and ending on the first anniversary of such
effective date, the vesting of the Option shall automatically accelerate with respect to 100% of the shares then unvested at the effective time of termination.
		
		  	For purposes of this Option, the following definitions shall apply:
		
		  	“Change in Control” shall have the meaning set forth in the Plan.
		
		  	“Involuntary Termination” shall include any termination of your employment by the Company other than (1) termination for Cause and (2) your voluntary termination.
Involuntary Termination also shall include your voluntary termination following: (a) a substantial reduction in your base salary (other than in connection with a general decrease in base salaries for employees of the Company); (b) a
material reduction in the kind or level of employee benefits with the result that your overall benefits package is significantly reduced; (c) the relocation of your place of employment to a facility or a location more than 50 miles from your
then present location, without your consent; or (d) a material diminution of your duties or your responsibilities.
		
		  	“Cause” shall have the meaning set forth in the Plan. 

  

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	Termination Period:	  	This Option may be exercised for 90 days after termination of your Continuous Service with the Company except as set forth in Section 5 of the Stock Option Agreement (but in no event later
than the Expiration Date). You are responsible for keeping track of these exercise periods following termination for any reason of your service relationship with the Company. The Company will not provide further notice of such
periods.
		
	Transferability:	  	This Option may not be transferred.

 By your signature and the signature of the Company’s representative below, you and the
Company agree that this option is granted under and governed by the terms and conditions of the Emphasys Medical, Inc. 2007 Equity Incentive Plan and the Stock Option Agreement, both of which are attached and made a part of this document.

 In addition, you agree and acknowledge that your rights to any Shares underlying the Option will be earned only as you provide services to
the Company over time, that the grant of the Option is not as consideration for services you rendered to the Company prior to your Vesting Commencement Date, and that nothing in this Notice or the attached documents confers upon you any right to
continue your employment or consulting relationship with the Company for any period of time, nor does it interfere in any way with your right or the Company’s right to terminate that relationship at any time, for any reason, with or without
cause. 
  

							
		 		 	EMPHASYS MEDICAL, INC.
				
	  
	 		 	By:	 	  

							
		 		 	Name:	 	  

							
		 		 	Title:	 	  

  

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 EMPHASYS MEDICAL, INC. 
 2007 EQUITY INCENTIVE PLAN 
 STOCK OPTION AGREEMENT 
 1.        Grant of Option. Emphasys Medical, Inc., a Delaware corporation (the
“Company”), hereby grants to                      (“Optionee”), an option (the “Option”) to
purchase the total number of shares of Common Stock (the “Shares”) set forth in the Notice of Stock Option Grant (the “Notice”), at the exercise price per Share set forth in the Notice (the “Exercise
Price”) subject to the terms, definitions and provisions of the Emphasys Medical, Inc. 2007 Equity Incentive Stock Plan (the “Plan”) adopted by the Company, which is incorporated in this Agreement by reference. Unless
otherwise defined in this Agreement, the terms used in this Agreement shall have the meanings defined in the Plan. This Stock Option Agreement shall be deemed executed by the Company and Optionee upon execution by such parties of the Notice.

 2.        Designation of Option. This Option is intended to be an Incentive Stock
Option as defined in Section 422 of the Code only to the extent so designated in the Notice, and to the extent it is not so designated or to the extent the Option does not qualify as an Incentive Stock Option, it is intended to be a
Nonstatutory Stock Option. 
 Notwithstanding the above, if designated as an Incentive Stock Option, in the event that the Shares subject to
this Option (and all other Incentive Stock Options granted to Optionee by the Company or any Parent or Subsidiary, including under other plans of the Company) that first become exercisable in any calendar year have an aggregate fair market value
(determined for each Share as of the date of grant of the option covering such Share) in excess of $100,000, the Shares in excess of $100,000 shall be treated as subject to a Nonstatutory Stock Option, in accordance with Section 5(c) of the
Plan. 
 3.        Exercise of Option. This Option shall be exercisable during its term
in accordance with the Vesting/Exercise Schedule set out in the Notice and with the provisions of Section 10 of the Plan as follows: 
   (a)        Right to Exercise. 
       (i)        This Option may not be exercised for a fraction of a share. 
       (ii)        In the event of Optionee’s death, disability or other termination of employment, the exercisability of the Option is
governed by Section 5 below, subject to the limitations contained in this Section 3. 
       (iii)        In no event may this Option be exercised after the Expiration Date of the Option as set forth in the Notice. 

   (b)        Method of Exercise.

       (i)        This Option shall be exercisable by execution and
delivery of the Exercise Notice attached hereto as Exhibit A or any other form of written notice approved for such purpose by the Company which shall state Optionee’s election to exercise the Option, the number of Shares in respect of
which the Option is being exercised, and such other representations and agreements as to the holder’s investment intent with respect to such Shares as may be required by the Company pursuant to the provisions of the Plan. Such written notice
shall be signed by Optionee and shall be delivered to the Company by such means as are determined by the Plan Administrator in its discretion to constitute adequate delivery. The written notice shall be accompanied by payment of the Exercise Price.
This Option shall be deemed to be exercised upon receipt by the Company of such written notice accompanied by the Exercise Price. 
       (ii)        As a condition to the exercise of this Option and as further set forth in Section 12 of the Plan, Optionee agrees to make adequate provision for
federal, state or other tax withholding obligations, if any, which arise upon the vesting or exercise of the Option, or disposition of Shares, whether by withholding, direct payment to the Company, or otherwise. 
       (iii)        The Company is not obligated, and will have no liability for
failure, to issue or deliver any Shares upon exercise of the Option unless such issuance or delivery would comply with the Applicable Laws, with such compliance determined by the Company in consultation with its legal counsel. This Option may not be
exercised until such time as the Plan has been approved by the stockholders of the Company, or if the issuance of such Shares upon such exercise or the method of payment of consideration for such shares would constitute a violation of any applicable
federal or state securities or other law or regulation, including any rule under Part 221 of Title 12 of the Code of Federal Regulations as promulgated by the Federal Reserve Board. As a condition to the exercise of this Option, the
Company may require Optionee to make any representation and warranty to the Company as may be required by the Applicable Laws. Assuming such compliance, for income tax purposes the Shares shall be considered transferred to Optionee on the date on
which the Option is exercised with respect to such Shares. 
 4.        Method of
Payment. Payment of the Exercise Price shall be by any of the following, or a combination of the following, at the election of Optionee: 
   (a)        cash or check; or 
   (b)        following the date, if any, upon which the Common Stock is a Listed Security, delivery of a properly executed exercise notice together with irrevocable instructions to a broker
approved by the Company to deliver promptly to the Company the amount of sale or loan proceeds required to pay the exercise price. 
 5.        Termination of Continuous Service. Following the date of Termination of Continuous Service of Optionee for any reason (the “Termination Date”), Optionee may
exercise the Option only as set forth in the Notice and this Section 5. To the extent that Optionee is not 

  

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entitled to exercise this Option as of the Termination Date, or if Optionee does not exercise this Option within the Termination Period set forth in the
Notice or the termination periods set forth below, the Option shall terminate in its entirety. In no event, may any Option be exercised after the Expiration Date of the Option as set forth in the Notice. 
   (a)        Termination. In the event of Termination of Continuous Service of Optionee
other than as a result of Optionee’s disability or death, Optionee may, to the extent otherwise so entitled at the Termination Date of such termination, exercise this Option during the Termination Period set forth in the Notice. 
   (b)        Other Terminations. In connection with any termination other than a
termination covered by Section 5(a), Optionee may exercise the Option only as described below: 
       (i)        Termination upon Disability of Optionee. In the event of Termination of Continuous Service of Optionee as a result of Optionee’s
disability, Optionee may, but only within twelve months from the Termination Date, exercise this Option to the extent Optionee was entitled to exercise it as of such Termination Date. 
       (ii)        Death of Optionee. In the event of the death of
Optionee (a) during the term of this Option and while an Employee or Consultant of the Company and having been in Continuous Service since the date of grant of the Option, or (b) within thirty (30) days after Optionee’s
Termination Date, the Option may be exercised at any time within twelve months following the date of death by Optionee’s estate or by a person who acquired the right to exercise the Option by bequest or inheritance, but only to the extent
Optionee was entitled to exercise the Option as of the Termination Date. 
 6.        Non-Transferability of Option. Except as otherwise set forth in the Notice, this Option may not be transferred in any manner otherwise than by will or by the laws of descent or
distribution and may be exercised during the lifetime of Optionee only by him or her. The terms of this Option shall be binding upon the executors, administrators, heirs, successors and assigns of Optionee. 
 7.        Tax Consequences. Below is a brief summary as of the date of this Option of certain of
the federal tax consequences of exercise of this Option and disposition of the Shares under the laws in effect as of the Date of Grant. THIS SUMMARY IS INCOMPLETE, AND THE TAX LAWS AND REGULATIONS ARE SUBJECT TO CHANGE. OPTIONEE SHOULD CONSULT A TAX
ADVISER BEFORE EXERCISING THIS OPTION OR DISPOSING OF THE SHARES. 
   (a)        Incentive Stock Option. 
       (i)        Tax Treatment upon Exercise and Sale of Shares. If this Option qualifies as an Incentive Stock Option, there will be no regular federal
income tax liability upon the exercise of the Option, although the excess, if any, of the fair market value of the Shares on the date of exercise over the Exercise Price will be treated as an adjustment to the alternative minimum tax for federal tax
purposes and may subject Optionee to the alternative minimum tax 

  

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in the year of exercise. If Shares issued upon exercise of an Incentive Stock Option are held for at least one year after exercise and are disposed of at
least two years after the Option grant date, any gain realized on disposition of the Shares will also be treated as long-term capital gain for federal income tax purposes. If Shares issued upon exercise of an Incentive Stock Option are disposed of
within such one-year period or within two years after the Option grant date, any gain realized on such disposition will be treated as compensation income (taxable at ordinary income rates) to the extent of the difference between the Exercise Price
and the lesser of (i) the fair market value of the Shares on the date of exercise, or (ii) the sale price of the Shares. 
       (ii)        Notice of Disqualifying Dispositions. With respect to any Shares issued upon exercise of an Incentive Stock Option, if Optionee
sells or otherwise disposes of such Shares on or before the later of (i) the date two years after the Option grant date, or (ii) the date one year after the date of exercise, Optionee shall immediately notify the Company in writing of such
disposition. Optionee acknowledges and agrees that he or she may be subject to income tax withholding by the Company on the compensation income recognized by Optionee from the early disposition by payment in cash or out of the current earnings paid
to Optionee. 
   (b)        Nonstatutory Stock Option. If
this Option does not qualify as an Incentive Stock Option, there may be a regular federal (and state) income tax liability upon the exercise of the Option. Optionee will be treated as having received compensation income (taxable at ordinary income
tax rates) equal to the excess, if any, of the fair market value of the Shares on the date of exercise over the Exercise Price. If Optionee is an Employee, the Company will be required to withhold from Optionee’s compensation or collect from
Optionee and pay to the applicable taxing authorities an amount equal to a percentage of this compensation income at the time of exercise. If Shares issued upon exercise of a Nonstatutory Stock Option are held for at least one year, any gain
realized on disposition of the Shares will be treated as long-term capital gain for federal income tax purposes. 
 8.        Effect of Agreement. Optionee acknowledges receipt of a copy of the Plan and represents that he or she is familiar with the terms and provisions thereof (and has had an
opportunity to consult counsel regarding the Option terms), and hereby accepts this Option and agrees to be bound by its contractual terms as set forth herein and in the Plan. Optionee hereby agrees to accept as binding, conclusive and final all
decisions and interpretations of the Plan Administrator regarding any questions relating to the Option. In the event of a conflict between the terms and provisions of the Plan and the terms and provisions of the Notice and this Agreement, the Plan
terms and provisions shall prevail. The Option, including the Plan, constitutes the entire agreement between Optionee and the Company on the subject matter hereof and supersedes all proposals, written or oral, and all other communications between
the parties relating to such subject matter. 
  

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 EXHIBIT A 
 EMPHASYS MEDICAL, INC. 
 2007 EQUITY INCENTIVE PLAN 
 EXERCISE NOTICE 
  

									
	To:	    	Emphasys Medical, Inc.
	Attn:	    	Stock Option Administrator
	Subject:	    	Notice of Intention to Exercise Stock Option
	
	 This is official notice that the undersigned (“Optionee”) intends to exercise Optionee’s option to purchase
                     shares of Emphasys Medical Common Stock, under and pursuant to the Company’s 2007 Equity Incentive Plan and the
Stock Option Agreement dated                     , as follows:

				
		    	Grant Number:	    	  
	    	
				
		    	Date of Purchase:	    	  
	    	
				
		    	Number of Shares:	    	  
	    	
				
		    	Purchase Price:	    	  
	    	
				
		    	 Method of Payment
 of Purchase Price:

	    	  
	    	

									
			
	 Social Security No.:
	  	  
	    	
	
	 The shares should be issued as follows:

											
					
		    	Name:	    	  
	    		    	
					
		    	Address:	    	  
	    		    	
					
		    		    	  
	    		    	
					
		    		    	  
	    		    	
					
		    	Signed:	    	  
	    		    	
					
		    	Date:Eighty-Fifth Supplemental Indenture

 Exhibit 4.1 
 Execution Copy 

 DUKE ENERGY CAROLINAS, LLC

 TO 
 THE BANK OF NEW YORK TRUST
COMPANY, N.A., 
 Trustee 
  

 EIGHTY-FIFTH SUPPLEMENTAL INDENTURE 
 Dated as of January 10, 2008 
  

 CREATING TWO SERIES OF FIRST AND REFUNDING 
 MORTGAGE BONDS 
 $400,000,000 FIRST AND REFUNDING MORTGAGE BONDS, 5.25% SERIES DUE 2018 
 $500,000,000 FIRST AND REFUNDING MORTGAGE BONDS, 6.00% SERIES DUE 2038 
  

 SUPPLEMENTAL TO 
 FIRST AND REFUNDING MORTGAGE

 DATED AS OF DECEMBER 1, 1927 
  

 SUPPLEMENTAL INDENTURE, bearing date as of the 10th day of January, 2008, made and entered into by and
between Duke Energy Carolinas, LLC, a limited liability company duly organized and existing under the laws of the State of North Carolina, hereinafter called the “Company,” party of the first part, and The Bank of New York Trust Company,
N.A., a national banking association, having a corporate trust office at 100 Ashford Center North, Suite 520, Atlanta, Georgia 30338, hereinafter called the “Trustee,” as Trustee, party of the second part. The Trustee is the successor to
JPMorgan Chase Bank, N.A. (formerly known as The Chase Manhattan Bank, formerly known as Chemical Bank (successor to Morgan Guaranty Trust Company of New York)), as trustee. 
 WHEREAS the Company’s predecessor is Duke Energy Corporation (formerly known as Duke Power Company), a corporation organized under the laws of the
State of North Carolina, which converted its form of organization on April 3, 2006 from a North Carolina corporation to a North Carolina limited liability company named “Duke Power Company LLC,” which changed its name to Duke Energy
Carolinas, LLC on October 1, 2006; and 
 WHEREAS Duke Power Company, a New Jersey corporation, hereinafter called the “New Jersey
Company,” duly executed and delivered its First and Refunding Mortgage, dated as of December 1, 1927, to Guaranty Trust Company of New York, as Trustee, to secure its First and Refunding Mortgage Gold Bonds, to be issued from time to time
in series as provided in said Mortgage, and has from time to time duly executed and delivered supplemental indentures, including supplemental indentures dated as of September 1, 1947 and February 1, 1949, to Guaranty Trust Company of New
York (the corporate name of which has been changed to Morgan Guaranty Trust Company of New York), as Trustee, and a supplemental indenture dated as of February 1, 1960 to Morgan Guaranty Trust Company of New York, as Trustee, supplementing and
modifying said Mortgage (said Mortgage, as so supplemented and modified, being hereinafter referred to as the “original indenture”); and 
 WHEREAS bonds of a series known as the “First and Refunding Mortgage Bonds, 2.65% Series Due
1977” (herein called “bonds of the 2.65% Series”), bonds of a series known as the “First and Refunding Mortgage Bonds, 2  7/8% Series Due 1979” (herein called “bonds of the 1979 Series”), bonds of a series known as the “First and Refunding Mortgage Bonds, 6  3/8% Series Due 1998” (herein called “bonds of the 1998 Series”), bonds of a series known as the “First and Refunding Mortgage Bonds,
Pollution Control Facilities Revenue Refunding Series Due 2014” (herein called “bonds of the 1990 Pollution Control Series”), bonds of a series known as the “First and Refunding Mortgage Bonds, City of Greensboro Series Due
2027” (herein called “bonds of the 2027 City of Greensboro Series”), bonds of a series known as the “First and Refunding Mortgage Bonds, Medium-Term Notes Series” (herein called “bonds of the Medium-Term Notes
Series”), bonds of a series known as the “First and Refunding Mortgage Bonds, 6  5/8% Series B Due
2003” (herein called “bonds of the 2003 Series B”), bonds of a series known as the “First and Refunding Mortgage Bonds, 6  3/8% Series Due 2008” (herein called “bonds of the 2008 Series”), bonds of a series known as the “First and Refunding Mortgage Bonds, 5  7/8% Series C Due 2003” (herein called “bonds of the 2003 Series C”), bonds of a series known as the “First and Refunding Mortgage Bonds,
Pollution Control Facilities Revenue Refunding Series Due 2014” (herein called “bonds of the 1993 Pollution Control Series”), bonds of a series known as the “First and Refunding Mortgage Bonds, 6  1
/4% Series B 2004” (herein called “bonds of the 2004 Series B”), bonds of a series known as the “First and Refunding
Mortgage Bonds, 7% 

  

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Series Due 2033” (herein called “bonds of the 2033 Series”), bonds of a series known as the “First and Refunding Mortgage Bonds, 6  7/8% Series B Due 2023” (herein called “bonds of the 2023 Series B”), bonds of a series known as the
“First and Refunding Mortgage Bonds, 6  3/4% Series Due 2025” (herein called “bonds of the 2025
Series”), bonds of a series known as the “First and Refunding Mortgage Bonds, 7  7/8% Series Due
2024” (herein called “bonds of the 2024 Series”), bonds of a series known as the “First and Refunding Mortgage Bonds, 7  1/2% Series B Due 2025” (herein called “bonds of the 2025 Series B”), bonds of a series known as the “First and Refunding Mortgage Bonds, 7 1/2% Series Due 1999” (herein called “bonds of the 1999 Series”), bonds of a series known as the “First and Refunding Mortgage Bonds, 7%
Series Due 2000” (herein called “bonds of the 2000 Series”), bonds of a series known as the “First and Refunding Mortgage Bonds, 7% Series B Due 2000” (herein called “bonds of the 2000 Series B”), bonds of a series
known as the “First and Refunding Mortgage Bonds, 6.625% Series due 2003” (herein called “bonds of the 2003 Series”), bonds of a series known as the “First and Refunding Mortgage Bonds, 9  5
/8% Series due 2020” (herein called “bonds of the 2020 Series”), bonds of a series known as the “First and Refunding
Mortgage Bonds, 8  3/4% Series due 2021” (herein called “bonds of the 2021 Series”), bonds of a
series known as “First and Refunding Mortgage Bonds, 7% Series due 2005” (herein called “bonds of the 2005 Series”), bonds of a series known as “First and Refunding Mortgage Bonds, 3.75% Series A due 2008” (herein
called “bonds of the 3.75% Series A”), bonds of series known as “First and Refunding Mortgage Bonds, 3.75% Series B due 2008” (herein called “bonds of the 3.75% Series B,” and together with the bonds of the 3.75% Series
A, the “bonds of the 3.75% Series”), bonds of a series known as “First and Refunding Mortgage Bonds, 7  3/8% Series Due 2023” (herein called “bonds of the 7  3/8% Series”), bonds of series
known as “First and Refunding Mortgage Bonds, 4 1/2% Series Due 2010” (herein called “bonds of the
4 1/2% Series”), bonds of series known as “First and Refunding Mortgage Bonds, 5.30% Series due
2015” (herein called “bonds of the 5.30% Series”) and such other bonds that have been issued have heretofore been issued and (except for bonds of the 2.65% Series, bonds of the 1979 Series, bonds of the 1998 Series, bonds of the 1999
Series, bonds of the 2000 Series, bonds of the 2000 Series B, bonds of the 2003 Series, bonds of the 2003 Series B, bonds of the 2003 Series C, bonds of the 2020 Series, bonds of the 2021 Series, bonds of the 2005 Series, bonds of the 2025 Series B,
bonds of the 7  3/8% Series and other such bonds which have been redeemed or retired in their entirety) are the
only bonds now outstanding under the original indenture as heretofore supplemented; and 
 WHEREAS the Company has duly executed and delivered a supplemental indenture, dated as of June 15, 1964, to Morgan Guaranty Trust Company of New
York, as Trustee, for the purpose of evidencing the succession by merger of the Company to the New Jersey Company and the assumption by the Company of the covenants and conditions of the New Jersey Company in the original indenture and to enable the
Company to have and exercise the powers and rights of the New Jersey Company under the original indenture in accordance with the terms thereof and whereby the Company assumed and agreed to pay duly and punctually the principal of and interest on the
bonds issued under the original indenture in accordance with the provisions of said bonds and the coupons thereto appertaining and the original indenture, and agreed to perform and fulfill all the terms, covenants and conditions of the original
indenture binding upon the New Jersey Company, and 
 WHEREAS Morgan Guaranty Trust Company of New York resigned as Trustee under the
original indenture as heretofore supplemented and Chemical Bank was appointed successor 

  

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Trustee, said resignation and appointment having taken effect on August 30, 1994 pursuant to an Instrument of Resignation, Appointment and Acceptance
dated as of August 30, 1994 among the Company, Morgan Guaranty Trust Company of New York, as Trustee, and Chemical Bank (now known as JPMorgan Chase Bank); and 
 WHEREAS JPMorgan Chase Bank, N.A. resigned as Trustee and The Bank of New York Trust Company, N.A. was appointed successor Trustee, said resignation and appointment having taken effect on September 24, 2007
pursuant to an Instrument of Resignation, Appointment and Acceptance dated as of September 24, 2007 among the Company, JPMorgan Chase Bank, N.A., as Trustee, and The Bank of New York Trust Company, N.A., as successor Trustee; and 
 WHEREAS the Company desires to create under the original indenture, as heretofore supplemented and as to be supplemented by this supplemental indenture,
two new series of bonds, to be known as its “First and Refunding Mortgage Bonds, 5.25% Series due 2018” and its “First and Refunding Mortgage Bonds, 6.00% Series due 2038”, and to determine the terms and provisions and the form
of the bonds of each such series; and 
 WHEREAS for the purposes hereinabove recited, and pursuant to due limited liability company action,
the Company has duly determined to execute and deliver to the Trustee a supplemental indenture in the form hereof supplementing the original indenture (the original indenture, as supplemented by the aforesaid supplemental indenture dated as of
June 15, 1964, by supplemental indentures dated as of February 1, 1968, March 1, 1990, May 15, 1990, July 1, 1991, March 1, 1993, April 1, 1993, May 1, 1993, July 1,
1993, August 1, 1993, August 20, 1993, May 1, 1994, February 25, 2003, March 21, 2003, September 23, 2003, March 20, 2006 and as hereby supplemented, being sometimes hereinafter
referred to as the “Indenture”); and 
 WHEREAS all conditions and requirements necessary to make this supplemental indenture a
valid, legal and binding instrument in accordance with its terms have been done and performed, and the execution and delivery hereof have been in all respects duly authorized: 
 NOW, THEREFORE, THIS INDENTURE WITNESSETH: 
 That in consideration of the premises and of the sum of one dollar duly paid by the Company to the Trustee at or before the execution and delivery of these presents, the receipt whereof is hereby acknowledged, the Company hereby covenants
and agrees with the Trustee and its successors in the trust under the Indenture as follows: 
 PART ONE. 
 BONDS OF THE 2018 SERIES AND BONDS OF THE 2038 SERIES 
 SECTION 1. BONDS OF THE 2018 SERIES 
 SECTION 1.1 The Company hereby creates a new series of
bonds to be issued under and secured by the Indenture and known as its First and Refunding Mortgage Bonds, 5.25% Series due 2018 (herein called “bonds of the 2018 Series”) and the Company hereby establishes, determines and fixes the terms
and provisions of the bonds of the 2018 Series as hereinafter in this Part One set forth. 
  

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 Each bond of the 2018 Series shall be dated the date of its authentication (except that if any such bond
shall be authenticated on any interest payment date, it shall be dated the following day) and interest shall be payable on the principal represented thereby commencing July 15, 2008, from the January 15 or July 15, as the case may be,
next preceding the date thereof to which interest has been paid, unless such date of authentication is prior to July 15, 2008, in which case interest shall be payable from January 10, 2008; provided, however, that interest
shall be payable on each bond of the 2018 Series authenticated after the record date (as defined in the next succeeding paragraph of this Section 1.1) with respect to any interest payment date and prior to such interest payment date, only from
such interest payment date. 
 Interest on any bond of the 2018 Series shall be paid to the person who, according to the bond register of the
Company, is the registered holder of such bond of the 2018 Series at the close of business on the applicable record date, and such interest payments shall be made by check mailed to such registered holder at his last address shown on such bond
register or, at the option of the Company, by wire transfer at such place and to such account at a banking institution in the United States as may be designated in writing to the Trustee at least sixteen (16) days prior to the date of payment
by the Person entitled thereto (provided, that if the bonds of the 2018 Series are represented by Global Securities held by the Depositary, payment may be made pursuant to the procedures of the Depositary); provided, however,
that, if the Company shall default in the payment of the interest due on any interest payment date on any bond of the 2018 Series, such defaulted interest shall be paid to the registered holder of such bond (or any bond or bonds of the 2018 Series
issued upon transfer, exchange or substitution thereof) on the date of subsequent payment of such defaulted interest or, at the election of the Company, to the person in whose name such bond (or any bond or bonds of the 2018 Series issued upon
transfer, exchange or substitution thereof) is registered on a subsequent record date established by notice given by mail by or on behalf of the Company to the holders of all bonds of the 2018 Series not less than ten (10) days preceding such
subsequent record date. The term “record date” as used in this Section 1.1 shall mean, with respect to any semi-annual interest payment date, the close of business on the January 1 or July 1, whether or not a business day,
next preceding such interest payment date or, in the case of a payment of defaulted interest, the close of business on any subsequent record date established as provided above. 
 SECTION 1.2 All bonds of the 2018 Series shall mature as to principal on January 15, 2018 and shall bear interest at a rate of 5.25% per
annum, payable semi-annually on the fifteenth day of January and July in each year, commencing on the fifteenth day of July, 2008. 
 SECTION 1.3 The bonds of the 2018 Series shall be fully registered bonds, without coupons, in denominations of two thousand dollars ($2,000) and integral multiples of one thousand dollars ($1,000) in excess thereof, all such bonds to
be numbered, and shall be transferable and exchangeable as provided in the form of bond set forth as Exhibit A to this supplemental indenture. The provisions of §1.19 and any other provision in the Indenture in respect of coupon bonds or
reservation of coupon bond numbers shall be inapplicable to the bonds of the 2018 Series. 
  

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 SECTION 1.4 The bonds of the 2018 Series may be redeemed at the option of the Company, in whole or
in part at any time and from time to time, at a redemption price equal to the greater of (1) 100% of the principal amount of the bonds of the 2018 Series to be redeemed and (2) the sum of the present values of the remaining scheduled
payments of principal and interest on such bonds of the 2018 Series (exclusive of interest accrued to the redemption date) discounted to the redemption date on a semiannual basis (assuming a 360-day year consisting of twelve 30-day months) at the
Treasury Rate plus 25 basis points, plus, in either case, accrued and unpaid interest on the principal amount being redeemed to such redemption date. The Company shall notify the Trustee of the redemption price with respect to any redemption
pursuant to this paragraph promptly after the calculation thereof. The Trustee shall not be responsible for calculating said redemption price. 
 The bonds of the 2018 Series are also subject to redemption through the operation of the Replacement Fund provided in Part Two of this supplemental indenture or through the application of moneys paid to the Trustee pursuant to the
provisions of §5.05 of the Indenture, at any time or from time to time prior to maturity, upon prior notice as hereinafter provided, at the redemption prices specified in the fourth paragraph of the reverse side of the form of bond set forth as
Exhibit A to this supplemental indenture, together with interest accrued thereon to the date fixed for redemption thereof. 
 All such
redemptions of bonds of the 2018 Series shall be effected as provided in Article 3 of the Indenture except that, in case a part only of the bonds of the 2018 Series is to be paid and redeemed, the particular bonds or part thereof shall be selected
by the Trustee in such manner as the Trustee in its uncontrolled discretion shall determine to be fair and in any case where several bonds are registered in the same name, the Trustee may treat the aggregate principal amount so registered as if it
were represented by one bond and except that when bonds are redeemed in part only the notice given to any particular holder need state only the principal amount of the bonds of that holder which is to be redeemed and except that notice to the
holders of bonds to be redeemed shall be given by mailing to such holders a notice of such redemption, first class mail postage prepaid, not later than the thirtieth day, and not earlier than the sixtieth day, before the date fixed for redemption,
at their last addresses as they shall appear upon the bond register of the Company. Any notice which is mailed in the manner herein provided shall be conclusively presumed to have been duly given, whether or not the holder receives such notice; and
failure duly to give such notice by mail, or any defect in such notice, to the holder of any bond designated for redemption as a whole or in part shall not affect the validity of the proceedings for the redemption of any other bond. No publication
of notice of such redemption shall be required. 
 SECTION 1.5 The limit upon the aggregate principal amount of the bonds of the 2018
Series which may be authenticated and delivered pursuant to this Eighty-Fifth Supplemental Indenture shall be $400,000,000. 
 SECTION 1.6
The place or places of payment (as to principal and premium, if any, and interest), redemption, transfer, exchange and registration of the bonds of the 2018 Series shall be the office or offices or the agency or agencies of the Company in the
Borough of Manhattan, The City of New York, designated from time to time by the Board of Directors of the Company (provided, that if the bonds of the 2018 Series are represented by Global Securities held by or on behalf of the Depositary, the
procedures of the Depositary may be followed for any action under this Section 1.6 of Part One). 
  

 6 

 SECTION 1.7 The form of the bonds of the 2018 Series and the certificate of the Trustee to be
endorsed on such bonds, respectively, shall be in substantially the form set forth in Exhibit A hereto. 
 SECTION 2. BONDS OF THE
2038 SERIES 
 SECTION 2.1 The Company hereby creates a new series of bonds to be issued under and secured by the Indenture and
known as its First and Refunding Mortgage Bonds, 6.00% Series due 2038 (herein called “bonds of the 2038 Series”, and together with the bonds of the 2018 Series, the “Bonds”) and the Company hereby establishes, determines and
fixes the terms and provisions of the bonds of the 2038 Series as hereinafter in this Part One set forth. 
 Each bond of the 2038 Series
shall be dated the date of its authentication (except that if any such bond shall be authenticated on any interest payment date, it shall be dated the following day) and interest shall be payable on the principal represented thereby commencing
July 15, 2008, from the January 15 or July 15, as the case may be, next preceding the date thereof to which interest has been paid, unless such date of authentication is prior to July 15, 2008, in which case interest shall be
payable from January 10, 2008; provided, however, that interest shall be payable on each bond of the 2038 Series authenticated after the record date (as defined in the next succeeding paragraph of this Section 2.1) with
respect to any interest payment date and prior to such interest payment date, only from such interest payment date. 
 Interest on any bond
of the 2038 Series shall be paid to the person who, according to the bond register of the Company, is the registered holder of such bond of the 2038 Series at the close of business on the applicable record date, and such interest payments shall be
made by check mailed to such registered holder at his last address shown on such bond register or, at the option of the Company, by wire transfer at such place and to such account at a banking institution in the United States as may be designated in
writing to the Trustee at least sixteen (16) days prior to the date of payment by the Person entitled thereto (provided, that if the bonds of the 2038 Series are represented by Global Securities held by the Depositary, payment may be
made pursuant to the procedures of the Depositary); provided, however, that, if the Company shall default in the payment of the interest due on any interest payment date on any bond of the 2038 Series, such defaulted interest shall be
paid to the registered holder of such bond (or any bond or bonds of the 2038 Series issued upon transfer, exchange or substitution thereof) on the date of subsequent payment of such defaulted interest or, at the election of the Company, to the
person in whose name such bond (or any bond or bonds of the 2038 Series issued upon transfer, exchange or substitution thereof) is registered on a subsequent record date established by notice given by mail by or on behalf of the Company to the
holders of all bonds of the 2038 Series not less than ten (10) days preceding such subsequent record date. The term “record date” as used in this Section 2.1 shall mean, with respect to any semi-annual interest payment date, the
close of business on the January 1 or July 1, whether or not a business day, next preceding such interest payment date or, in the case of a payment of defaulted interest, the close of business on any subsequent record date established as
provided above. 
  

 7 

 SECTION 2.2 All bonds of the 2038 Series shall mature as to principal on January 15, 2038 and
shall bear interest at a rate of 6.00% per annum, payable semi-annually on the fifteenth day of January and July in each year, commencing on the fifteenth day of July, 2008. 
 SECTION 2.3 The bonds of the 2038 Series shall be fully registered bonds, without coupons, in denominations of two thousand dollars ($2,000) and
integral multiples of one thousand dollars ($1,000) in excess thereof, all such bonds to be numbered, and shall be transferable and exchangeable as provided in the form of bond set forth as Exhibit B to this supplemental indenture. The provisions of
§1.19 and any other provision in the Indenture in respect of coupon bonds or reservation of coupon bond numbers shall be inapplicable to the bonds of the 2038 Series. 
 SECTION 2.4 The bonds of the 2038 Series may be redeemed at the option of the Company, in whole or in part at any time and from time to time, at a
redemption price equal to the greater of (1) 100% of the principal amount of the bonds of the 2038 Series to be redeemed and (2) the sum of the present values of the remaining scheduled payments of principal and interest on such bonds of
the 2038 Series (exclusive of interest accrued to the redemption date) discounted to the redemption date on a semiannual basis (assuming a 360-day year consisting of twelve 30-day months) at the Treasury Rate plus 30 basis points, plus, in either
case, accrued and unpaid interest on the principal amount being redeemed to such redemption date. The Company shall notify the Trustee of the redemption price with respect to any redemption pursuant to this paragraph promptly after the calculation
thereof. The Trustee shall not be responsible for calculating said redemption price. 
 The bonds of the 2038 Series are also subject to
redemption through the operation of the Replacement Fund provided in Part Two of this supplemental indenture or through the application of moneys paid to the Trustee pursuant to the provisions of §5.05 of the Indenture, at any time or from time
to time prior to maturity, upon prior notice as hereinafter provided, at the redemption prices specified in the fourth paragraph of the reverse side of the form of bond set forth as Exhibit B to this supplemental indenture, together with interest
accrued thereon to the date fixed for redemption thereof. 
 All such redemptions of bonds of the 2038 Series shall be effected as provided
in Article 3 of the Indenture except that, in case a part only of the bonds of the 2038 Series is to be paid and redeemed, the particular bonds or part thereof shall be selected by the Trustee in such manner as the Trustee in its uncontrolled
discretion shall determine to be fair and in any case where several bonds are registered in the same name, the Trustee may treat the aggregate principal amount so registered as if it were represented by one bond and except that when bonds are
redeemed in part only the notice given to any particular holder need state only the principal amount of the bonds of that holder which is to be redeemed and except that notice to the holders of bonds to be redeemed shall be given by mailing to such
holders a notice of such redemption, first class mail postage prepaid, not later than the thirtieth day, and not earlier than the sixtieth day, before the date fixed for redemption, at their last addresses as they shall appear upon the bond register
of the Company. Any notice which is mailed in the manner herein provided shall be conclusively presumed to have been duly given, whether or not the holder receives such notice; and failure duly to give such notice by mail, or any defect in such
notice, to the holder of 

  

 8 

 
any bond designated for redemption as a whole or in part shall not affect the validity of the proceedings for the redemption of any other bond. No
publication of notice of such redemption shall be required. 
 SECTION 2.5 The limit upon the aggregate principal amount of the bonds
of the 2038 Series which may be authenticated and delivered pursuant to this Eighty-Fifth Supplemental Indenture shall be $500,000,000. 
 SECTION 2.6 The place or places of payment (as to principal and premium, if any, and interest), redemption, transfer, exchange and registration of the bonds of the 2038 Series shall be the office or offices or the agency or agencies
of the Company in the Borough of Manhattan, The City of New York, designated from time to time by the Board of Directors of the Company (provided, that if the bonds of the 2038 Series are represented by Global Securities held by or on behalf
of the Depositary, the procedures of the Depositary may be followed for any action under this Section 2.6 of Part One). 
 SECTION
2.7 The form of the bonds of the 2038 Series and the certificate of the Trustee to be endorsed on such bonds, respectively, shall be in substantially the form set forth in Exhibit B hereto. 
 PART TWO. 
 REPLACEMENT FUND. 

 SECTION 1. So long as any of the Bonds are outstanding, the Company will continue to maintain the Replacement Fund set forth in,
and in accordance with the applicable terms and conditions now contained in, Part Two of the supplemental indenture dated as of February 1, 1949, and the covenants on the part of the Company contained in such Part Two shall continue and remain
in full force and effect, whether or not bonds of the 1979 Series are outstanding and to the same extent as though the words “or any bonds of the 2018 Series or the 2038 Series” were inserted after the word “Series” appearing in
the second line of Section 1 and the second line of Section 4 of said Part Two of said supplemental indenture dated as of February 1, 1949. 
 SECTION 2. If at any time (a) any of the Bonds are outstanding and (b) no bonds
of the Medium-Term Notes Series, of the 2008 Series, of the 2003 Series C, of the 2004 Series B, of the 3.75% Series, of the 4 1/2% Series, of the 5.30% Series, of the 2033 Series, of the 2023 Series B, of the 2025 Series or of the 2024 Series are outstanding and (c) cash which shall have been deposited with the Trustee pursuant to such Replacement Fund
shall not within five years from the date of deposit thereof have been paid out, or used or set aside by the Trustee for the payment, purchase or redemption of bonds, pursuant to such Replacement Fund, such cash shall, if in excess of fifty thousand
dollars ($50,000), be applied to the redemption of bonds of the 2018 Series and the 2038 Series on a pro rata basis as between such series in an aggregate principal amount sufficient to exhaust as nearly as possible the full amount of such cash.
Anything in Section 5 of Part Two of the aforesaid supplemental indenture dated as of February 1, 1949, in Section 3 of Part Two of the supplemental indentures dated as of May 1, 1993, July 1, 1993, August 1,
1993, August 20, 1993, May 1, 1994, February 25, 2003, March 21, 2003 and 

  

 9 

 
September 23, 2003, in Section 3 of Part Three of the supplemental indenture dated as of March 1, 1990 and in Section 5 of Part Four of
the supplemental indenture dated as of March 1, 1993 to the contrary notwithstanding, no cash shall be paid over to the Company thereunder if at the time any bonds of the 2018 Series or the 2038 Series are then outstanding, and such cash shall
in such event be applied as in this Part Two set forth. 
 SECTION 3. Whenever
all of the Bonds, the bonds of the Medium-Term Notes Series, the 2003 Series B, the 2008 Series, the 2003 Series C, the 2004 Series B, the 3.75% Series, the 4 1/2% Series, the 5.30% Series, the 2033 Series, the 2025 Series and the 2024 Series shall have been paid, purchased or redeemed, the Trustee shall, upon application of the Company, pay to or upon the
order of the Company all cash theretofore deposited with the Trustee pursuant to the provisions of the Replacement Fund and not previously disposed of pursuant to the provisions of the Replacement Fund, and shall deliver to the Company any bonds
which shall theretofore have been deposited with the Trustee pursuant to the provisions of the Replacement Fund or paid, purchased or redeemed pursuant to the provisions of the Replacement Fund. 
 PART THREE. 
 ADDITIONAL COVENANTS
OF THE COMPANY 
 SECTION 1. Whether or not the covenants on the part of
the Company contained in Part Three of the supplemental indenture dated as of February 1, 1949 are modified with the consent of the holders of bonds of the 1990 Pollution Control Series, the 2027 City of Greensboro Series, the Medium-Term Notes
Series, the 2008 Series, the 2003 Series C, the 1993 Pollution Control Series, the 2004 Series B, the 2033 Series, the 2023 Series B, the 2025 Series, the 2024 Series, the bonds of the 3.75% Series, the bonds of the 4 1/2% Series or the bonds of the 5.30% Series and whether or not the bonds of the 1990 Pollution Control Series, the
2027 City of Greensboro Series, the Medium-Term Notes Series, the 2008 Series, the 2003 Series C, the 1993 Pollution Control Series, the 2004 Series B, the 2033 Series, the 2023 Series B, the 2025 Series, the 2024 Series, the bonds of the 3.75%
Series, the bonds of the 4 1/2% Series or the bonds of the 5.30% Series are outstanding, such covenants on the
part of the Company contained in said Part Three shall continue and remain in full force and effect so long as any of the Bonds are outstanding and to the same extent as though the words “or so long as any bonds of the 2018 Series or the 2038
Series are outstanding” were inserted after the words “so long as any of the bonds of the 1979 Series or any bonds of the 2.65% Series are outstanding” wherever such words appear in said Part Three of the supplemental indenture dated
as of February 1, 1949. 
 SECTION 2. Whether or not the second sentence of paragraph (a) of §2.08 of the
original indenture (making certain provisions for the definition of the term “net amount” applicable while bonds of the 2.65% Series were outstanding and which was originally set forth in Section 4 of Article One of the supplemental
indenture dated as of September 1, 1947 and which is corrected and clarified by Section 2 of Part Four of the supplemental indenture dated as of February 1, 1968) is modified with the consent of the holders of bonds of the 1990
Pollution Control Series, the 2027 City of Greensboro Series, Medium-Term Notes Series, the 2008 Series, the 2003 Series C, the 1993 Pollution Control Series, the 2004 Series B, the 2033 Series, the 2023 Series B, the 2025 Series, the 2024 Series,
the bonds of the 3.75% Series, the bonds of the 

  

 10 

 
4 1/2% Series or the
bonds of the 5.30% Series and whether or not bonds of the 1990 Pollution Control Series, the 2027 City of Greensboro Series, the Medium-Term Notes Series, the 2008 Series, the 2003 Series C, the 1993 Pollution Control Series, the 2004 Series B, the
2033 Series, the 2023 Series B, the 2025 Series, the 2024 Series, the bonds of the 3.75% Series, the bonds of the 4 1/2% Series or the bonds of the 5.30% Series are outstanding, said sentence shall continue and remain in full force and effect so long as any Bonds are outstanding, and with the same force and effect as though said sentence had stated
that such provisions were to be applicable so long as any of the bonds of the 2018 Series or the 2038 Series are outstanding. 
 PART FOUR. 
 GLOBAL SECURITIES; TRANSFER AND EXCHANGE 
 SECTION 1. The bonds of the 2018 Series shall initially be issued in the form of one or more Global Securities registered in the name of the
Depositary (which initially shall be The Depository Trust Company) or its nominee. Except under the limited circumstances described below, bonds of the 2018 Series represented by such Global Security or Global Securities shall not be exchangeable
for, and shall not otherwise be issuable as, bonds of the 2018 Series in definitive form. The Global Securities described in this Part Four may not be transferred except by the Depositary to a nominee of the Depositary or by a nominee of the
Depositary to the Depositary or another nominee of the Depositary or to a successor Depositary or its nominee. 
 None of the Company, the
Trustee nor any agent of the Company or the Trustee will have any responsibility or liability for any aspect of the records relating to or payments made on account of beneficial ownership interests of a Global Security or maintaining, supervising or
reviewing any records relating to such beneficial ownership interests. 
 A Global Security shall be exchangeable for bonds of the 2018
Series registered in the names of persons other than the Depositary or its nominee only if (i) the Depositary notifies the Company that it is unwilling or unable to continue as a Depositary for such Global Security and no successor Depositary
shall have been appointed by the Company within 90 days of receipt by the Company of such notification, or if at any time the Depositary ceases to be a clearing agency registered under the Exchange Act at a time when the Depositary is required to be
so registered to act as such Depositary and no successor Depositary shall have been appointed by the Company within 90 days after it becomes aware of such cessation, (ii) an Event of Default has occurred and is continuing with respect to the
2018 Series or (iii) the Company in its sole discretion, and subject to the procedures of the Depositary, determines that such Global Security shall be so exchangeable. Any Global Security that is exchangeable pursuant to the preceding sentence
shall be exchangeable for bonds of the 2018 Series registered in such names as the Depositary shall direct. 
 SECTION 2. The bonds of
the 2038 Series shall initially be issued in the form of one or more Global Securities registered in the name of the Depositary (which initially shall be The Depository Trust Company) or its nominee. Except under the limited circumstances described
below, bonds of the 2038 Series represented by such Global Security or Global Securities shall not be exchangeable for, and shall not otherwise be issuable as, bonds of the 

  

 11 

 
2038 Series in definitive form. The Global Securities described in this Part Four may not be transferred except by the Depositary to a nominee of the
Depositary or by a nominee of the Depositary to the Depositary or another nominee of the Depositary or to a successor Depositary or its nominee. 
 None of the Company, the Trustee nor any agent of the Company or the Trustee will have any responsibility or liability for any aspect of the records relating to or payments made on account of beneficial ownership interests of a Global
Security or maintaining, supervising or reviewing any records relating to such beneficial ownership interests. 
 A Global Security shall be
exchangeable for bonds of the 2038 Series registered in the names of persons other than the Depositary or its nominee only if (i) the Depositary notifies the Company that it is unwilling or unable to continue as a Depositary for such Global
Security and no successor Depositary shall have been appointed by the Company within 90 days of receipt by the Company of such notification, or if at any time the Depositary ceases to be a clearing agency registered under the Exchange Act at a time
when the Depositary is required to be so registered to act as such Depositary and no successor Depositary shall have been appointed by the Company within 90 days after it becomes aware of such cessation, (ii) an Event of Default has occurred
and is continuing with respect to the 2038 Series or (iii) the Company in its sole discretion, and subject to the procedures of the Depositary, determines that such Global Security shall be so exchangeable. Any Global Security that is
exchangeable pursuant to the preceding sentence shall be exchangeable for bonds of the 2038 Series registered in such names as the Depositary shall direct. 
 SECTION 3. Depository Legend. Each of the Global Securities shall bear the following legend (the “Depository Legend”) on the face thereof: 
 “UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION (“DTC”), NEW
YORK, NEW YORK, TO THE COMPANY OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC
(AND ANY PAYMENT IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE
REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN. 
 TRANSFERS OF THIS GLOBAL SECURITY SHALL BE LIMITED TO TRANSFERS IN
WHOLE, BUT NOT IN PART, TO DTC, TO NOMINEES OF DTC OR TO A SUCCESSOR THEREOF OR SUCH SUCCESSOR’S NOMINEE AND TRANSFERS OF PORTIONS OF THIS GLOBAL SECURITY SHALL BE LIMITED TO TRANSFERS MADE IN ACCORDANCE WITH THE RESTRICTIONS SET FORTH IN THE
INDENTURE REFERRED TO ON THE REVERSE HEREOF.” 
  

 12 

 SECTION 4. Transfer and Exchange. (a) Every bond of the 2018 Series or the 2038 Series
presented or surrendered for registration of transfer or for exchange shall (if so required by the Company or the Trustee) be duly endorsed, or be accompanied by a written instrument of transfer in form satisfactory to the Company and the Trustee
duly executed, by the Holder thereof or his attorney duly authorized in writing. 
 (b) No service charge shall be made for
any registration of transfer or exchange of bonds of the 2018 Series or the 2038 Series, but the Company may require payment of a sum sufficient to cover any tax or other governmental charge that may be imposed in connection with any registration or
transfer or exchange of bonds of the 2018 Series or the 2038 Series. 
 SECTION 5. Definitions. The following defined terms
used herein shall, unless the context otherwise requires, have the meanings specified below. Capitalized terms used herein for which no definition is provided herein shall have the meanings set forth in the Indenture. 
 “Business day” means any day other than a day on which banks in New York City are required or authorized to be closed. 
 “Comparable Treasury Issue” means the United States Treasury security selected by the Quotation Agent as having a maturity comparable to the
remaining term of the Bonds to be redeemed that would be utilized, at the time of selection and in accordance with customary financial practice, in pricing new issues of corporate debt securities of comparable maturity to the remaining term of such
Bonds. 
 “Comparable Treasury Price” means with respect to any redemption date for Bonds, the average of two Reference Treasury
Dealer Quotations for such redemption date. 
 “Depositary” means a clearing agency registered under the Exchange Act that is
designated to act as Depositary for the bonds of the 2018 Series or the 2038 Series, which Depositary shall initially be The Depository Trust Company. 
 “Depository Legend” means a legend set forth in Section 3 of this Part Four. 
 “Exchange
Act” means the Securities Exchange Act of 1934, as amended. 
 “Global Security” means a Bond in global form. 
 “Holder” means a Person in whose name a bond of the 2018 Series or the 2038 Series is registered in the registration books maintained by the
Trustee. 
 “Person” means any individual, corporation, partnership, limited liability company or corporation, joint venture,
trust, unincorporated organization or government or any agency or political subdivision thereof. 
 “Quotation Agent” means a
Reference Treasury Dealer appointed by the Company. 
  

 13 

 “Reference Treasury Dealers” means each of J.P. Morgan Securities Inc. and one other primary
U.S. Government Securities dealer in the United States (a “Primary Treasury Dealer”) selected by Wachovia Capital Markets, LLC, and their respective successors; provided, however, that if any of the foregoing shall cease to
be a Primary Treasury Dealer, the Company shall substitute therefor another Primary Treasury Dealer. 
 “Reference Treasury Dealer
Quotations” means, with respect to each Reference Treasury Dealer and any redemption date, the average, as determined by the Quotation Agent, of the bid and asked prices for the Comparable Treasury Issue (expressed in each case as a percentage
of its principal amount) quoted in writing to the Quotation Agent by such Reference Treasury Dealer at 5:00 p.m., New York City time, on the third business day preceding such redemption date. 
 “Treasury Rate” means, with respect to any redemption date, (1) the yield, under the heading which represents the average for the
immediately preceding week, appearing in the most recently published statistical release designated “H.15(519)” or any successor publication which is published weekly by the Board of Governors of the Federal Reserve System and which
establishes yields on actively traded United States Treasury securities adjusted to constant maturity under the caption “Treasury Constant Maturities,” for the maturity corresponding to the Comparable Treasury Issue (if no maturity is
within three months before or after the maturity date of the Bonds to be redeemed, yields for the two published maturities most closely corresponding to the Comparable Treasury Issue shall be determined, and the Treasury Rate shall be interpolated
or extrapolated from such yields on a straight-line basis, rounding to the nearest month) or (2) if such release (or any successor release) is not published during the week preceding the calculation date or does not contain such yields, the
rate per year equal to the semi-annual equivalent yield to maturity of the Comparable Treasury Issue, calculated using a price for the Comparable Treasury Issue (expressed as a percentage of its principal amount) equal to the Comparable Treasury
Price for such redemption date. The Treasury Rate will be calculated on the third business day preceding the redemption date. 
 PART FIVE.

 MISCELLANEOUS. 
 SECTION 1. (a) For the purposes of §2.10 of the Indenture and for the purposes of
any modification of the provisions of the Replacement Fund referred to in Part Two of this supplemental indenture, the covenants and provisions on the part of the Company which are set forth or incorporated in Part Two of this supplemental indenture
shall be for the benefit only of the holders of the bonds of the 2018 Series and the 2038 Series. Such covenants and provisions shall remain in force and be applicable only so long as any bonds of the 2018 Series or the 2038 Series shall be
outstanding, and, subject to the provisions of paragraph (2) of subdivision (c) of §10.01 of the Indenture, any such covenants and provisions may be modified with respect to the bonds of the 2018 Series or the 2038 Series with the
consent, in writing or by vote at a bondholders’ meeting of the holders of sixty-six and two-thirds per cent (66  2/3%) of the principal amount of the bonds of the 2018 Series or the 2038 Series, as the case may be, at the time outstanding and without the consent of the holders of any other bonds then outstanding under the Indenture;
provided that no such consent shall be effective to waive any past default under such covenants and provisions, and its consequences, unless the consent of the holders of 

  

 14 

 
at least a majority in principal amount of all bonds then outstanding under the Indenture is obtained. Such covenants shall be deemed to be additional
covenants and none of them shall affect or derogate from, or relieve the Company from, its obligation to comply with any of the other covenants, conditions, requirements or provisions of the Indenture or any other supplemental indenture. 

(b) For the purposes of §2.10 of the Indenture and for the purposes of any modification of
the provisions of Part Three of this supplemental indenture, the covenants and provisions on the part of the Company which are set forth or incorporated in said Part Three shall be for the benefit only of the holders of the bonds of the 2018 Series
and the 2038 Series. Such covenants and provisions shall remain in force and be applicable only so long as any bonds of the 2018 Series or the 2038 Series shall be outstanding, and, subject to the provisions of paragraph (2) of subdivision
(c) of §10.01 of the Indenture, any such covenants and provisions may be modified with respect to the bonds of the 2018 Series or the 2038 Series with the consent, in writing or by vote at a bondholders’ meeting of the holders of
sixty-six and two-thirds per cent (66  2/3%) of the principal amount of the bonds of the 2018 Series or the 2038
Series, as the case may be, at the time outstanding and without the consent of the holders of any other bonds then outstanding under the Indenture; provided that no such consent shall be effective to waive any past default under such
covenants and provisions, and its consequences, unless the consent of the holders of at least a majority in principal amount of all bonds then outstanding under the Indenture is obtained. Such covenants shall be deemed to be additional covenants and
none of them shall affect or derogate from, or relieve the Company from, its obligation to comply with any of the other covenants, conditions, requirements or provisions of the Indenture or any other supplemental indenture. 
 SECTION 2. All terms contained in this supplemental indenture shall, except as specifically provided herein or except as the context may otherwise
require, have the meanings given to such terms in the Indenture. 
 SECTION 3. In case any one or more of the provisions contained in
this supplemental indenture should be invalid, illegal or unenforceable in any respect, such invalidity, illegality or unenforceability shall not affect any other provision contained in this supplemental indenture, and, to the extent, but only to
the extent, that such provision is invalid, illegal or unenforceable, this supplemental indenture shall be construed as if such provision had never been contained herein. 
 SECTION 4. The Trustee hereby accepts the trusts herein declared and provided upon the terms and conditions in the Indenture set forth. 
 SECTION 5. This supplemental indenture may be executed in several counterparts, each of which shall be an original, and all collectively but one
instrument. 
 SECTION 6. In addition to the amendment provisions of the Indenture, the terms and conditions of this supplemental
indenture and the bonds of the 2018 Series or the 2038 Series may be modified, amended or supplemented by the Company and the Trustee, without the consent of the holders of the bonds of the 2018 Series or the 2038 Series, and if not inconsistent
with the Indenture, to cure ambiguities in this supplemental indenture or the bonds of the 2018 

  

 15 

 
Series or the 2038 Series, or correct defects or inconsistencies in the provisions of this supplemental indenture or the bonds of the 2018 Series or the 2038
Series or to provide for such appropriate additional provisions in this supplemental indenture or the bonds of the 2018 Series or the 2038 Series as are necessary for certificated bonds to be issued in lieu of Global Securities or to reflect
additional provisions related to the issuance of Global Securities (including changes in the procedures of the Depositary). 
  

 16 

 IN WITNESS WHEREOF, Duke Energy Carolinas, LLC, the party of the first part hereto, has caused this
supplemental indenture to be signed in its name by one of its Vice Presidents and its corporate seal to be hereunto affixed, and the same to be attested by one of its Assistant Secretaries, and The Bank of New York Trust Company, N.A., the party of
the second part hereto, in token of its acceptance of the trust hereby created, has caused this supplemental indenture to be signed in its name by one of its Vice Presidents and its corporate seal to be hereunto affixed, all as of the day and year
first above written. 
  

			
	DUKE ENERGY CAROLINAS, LLC
		
	 By:
	 	 /s/ M. Allen Carrick

	 Name:
	 	M. Allen Carrick
	 Title:
	 	Assistant Treasurer

  

	
	ATTEST:
	
	 /s/ Robert T. Lucas III

	Name: Robert T. Lucas III
	Title: Assistant Secretary
	
	Signed, sealed, executed, acknowledged and delivered by Duke Energy
	Carolinas, LLC, in the presence of:
	
	 /s/ Delcia S. Dunlap

	Delcia S. Dunlap
	
	 /s/ Jennie M. Raine

	Jennie M. Raine

  

 17 

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

		
	 By:
	 	 /s/ Stefan Victory

	 Name:
	 	Stefan Victory
	 Title:
	 	Vice President

  

	
	ATTEST:
	
	 /s/ Reda Sabaliauskaite

	Name: Reda Sabaliauskaite
	Title: Assistant Treasurer
	
	Signed, sealed, executed, acknowledged and delivered by The Bank of New York Trust Company, N.A., in the presence of:
	
	 /s/ Inna Rueve

	Name: Inna Rueve
	Title: Trust Associate
	
	 /s/ Lakeisha Wilson

	Name: Lakeisha Wilson
	Title: Trust Associate

  

 18 

											
	 State of Georgia
	  		  	)	  		  		  	
		  		  	)	  	ss.:	  		  	
	 County of Dekalb
	  		  	)	  		  		  	

 Personally appeared before me, Inna Rueve, and made oath that she saw Stefan Victory, a Vice President, and Reda
Sabaliauskaite, an Assistant Treasurer, respectively, of The Bank of New York Trust Company, N.A., sign, attest and affix hereto the corporate seal of said The Bank of New York Trust Company, N.A., and, as the act and deed of said corporation,
deliver the within written and foregoing deed, and that she, with Lakeisha Wilson, witnessed the execution thereof. 
  

	
	 /s/ Reda Sabaliauskaite

	Reda Sabaliauskaite
	
	Sworn and subscribed before me this 10th day of January, 2008.
	
	 /s/ David Dawes

	David Dawes
	Notary Public
	Commission Expires August 10, 2010

  

											
	 State of Georgia
	  		  	)	  		  		  	
		  		  	)	  	ss.:	  		  	
	 County of Dekalb
	  		  	)	  		  		  	

 I, David Dawes, a Notary Public in and for the State and County aforesaid, certify that Reda Sabaliauskaite
personally came before me this day and acknowledged that she is an Assistant Treasurer of The Bank of New York Trust Company, N.A., a national banking association, and that, by authority duly given and as the act of the corporation, the foregoing
instrument was signed in its name by one of its Vice Presidents, sealed with its corporate seal, and attested by herself as one of its Assistant Treasurers. 
 Witness may hand and official seal, this 10th day of January, 2008. 
  

	
	 /s/ David Dawes

	David Dawes
	Notary Public
	Commission Expires August 10, 2010

  

 19 

															
	 State of North Carolina
	  		  	)	  		  		  		  		  	
		  		  	)	  	ss.:	  		  		  		  	
	 County of Mecklenburg
	  		  	)	  		  		  		  		  	

 I, Heather Paige Blum, a notary public of Mecklenburg County, North Carolina, certify that Delcia S. Dunlap
personally appeared before me this day, and being duly sworn, stated that in her presence M. Allen Carrick executed the foregoing instrument, and that she, with Jennie M. Raine, witnessed the execution thereof. 
 Witness my hand and official seal, this the 10th day of January, 2008. 
  

	
	 /s/ Heather Paige Blum

	Heather Paige Blum
	Notary Public
	
	My Commission expires January 9, 2013.

  

															
	 State of North Carolina
	  		  	)	  		  		  		  		  	
		  		  	)	  	ss.:	  		  		  		  	
	 County of Mecklenburg
	  		  	)	  		  		  		  		  	

 I, Heather Paige Blum, a Notary Public in and for the State and County aforesaid, certify that Robert T. Lucas III
personally came before me this day and acknowledged that he is an Assistant Secretary of Duke Energy Carolinas, LLC, a North Carolina limited liability company, and that, by authority duly given and as the act of the corporation, the foregoing
instrument was signed in its name by one of its Assistant Treasurers, sealed with its corporate seal, and attested by himself as one of its Assistant Secretaries. 
 Witness my hand and official seal, this the 10th day of January, 2008. 
  

	
	 /s/ Heather Paige Blum

	Heather Paige Blum
	Notary Public
	
	My Commission expires January 9, 2013.

  

 20 

 EXHIBIT A 
 FORM OF DUKE ENERGY CAROLINAS, LLC 
 FIRST AND REFUNDING MORTGAGE BOND, 5.25% SERIES DUE 2018 
 [FACE SIDE OF BOND] 
 [DEPOSITORY LEGEND, IF
APPLICABLE] 
 DUKE ENERGY CAROLINAS, LLC 
 FIRST AND REFUNDING MORTGAGE BOND, 
 5.25% SERIES DUE 2018 
  

			
	No.	 	$
	CUSIP No. 26442CAC8	 	
	ISIN US26442CAC82	 	

 Duke Energy Carolinas, LLC, a North Carolina limited liability company (hereinafter called the
“Company”), for value received, hereby promises to pay to              or registered assigns, the principal sum of
             Dollars on January 15, 2018 in any coin or currency of the United States of America which at the time of payment shall be legal tender for the payment of public and
private debts, at the office or agency of the Company in the Borough of Manhattan, The City of New York, and to pay interest thereon at said office or agency from the interest payment date next preceding the date hereof to which interest on
outstanding bonds of this series has been paid (unless the date hereof is prior to July 15, 2008, in which case from January 10, 2008, and unless the date hereof is subsequent to a record date (as defined below) and prior to the next
succeeding January 15 or July 15, in which case from the next succeeding January 15 or July 15, as the case may be), at the rate of 5.25% per cent per annum, in like coin or currency, semi-annually on January 15 and
July 15 in each year, commencing July 15, 2008, until the principal hereof shall become due and payable. Such interest payments shall be made to the person in whose name this bond is registered at the close of business on the
January 1 or July 1, whether or not a business day, preceding each semi-annual interest payment date (a “record date”) (subject to certain exceptions provided in the Indenture hereinafter mentioned), at his last address as it
shall appear upon the bond register of the Company. 
 The provisions of this bond are continued on the reverse hereof and such continued
provisions shall for all purposes have the same effect as though fully set forth in this place. 
 This bond shall not become or be valid or
obligatory for any purpose until the Trustee shall have signed the form of certificate endorsed hereon. 
  

 A-1 

 IN WITNESS WHEREOF, the Company has caused this instrument to be signed in its name by its President or
one of its Vice Presidents, manually or by facsimile signature, and its corporate seal to be hereto affixed, or a facsimile thereof to be hereon engraved, lithographed or printed, and to be attested by the manual or facsimile signature of its
Secretary or one of its Assistant Secretaries. 
 Dated: 
  

			
	DUKE ENERGY CAROLINAS, LLC
		
	 By:
	 	  

	 Name:
	 	
	 Title:
	 	

  

	
	 ATTEST:

	
	  

	 Name:

	 Title:

 CERTIFICATE OF AUTHENTICATION 
 This bond is one of the bonds, of the series designated therein, described in the within-mentioned Indenture. 
  

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

		 	Authorized Signatory

  

 A-2 

 [REVERSE SIDE OF BOND] 
 This bond is one of the bonds of a series, designated specially as First and Refunding Mortgage
Bonds, 5.25% Series due 2018, of an authorized issue of bonds of the Company, without limit as to aggregate principal amount, designated generally as First and Refunding Mortgage Bonds, all issued and to be issued under and equally and ratably
secured by an indenture dated as of December 1, 1927, duly executed by Duke Power Company, a New Jersey corporation (hereinafter called the “New Jersey Company”), to Guaranty Trust Company of New York, as Trustee (The Bank of New York
Trust Company, N.A., as successor trustee), as supplemented and modified by indentures supplemental thereto, including supplemental indentures dated as of September 1, 1947, February 1, 1949, February 1,
1960, June 15, 1964 (under which the Company succeeded to and was substituted for the New Jersey Company), February 1, 1968, March 1, 1990, May 15, 1990, July 1, 1991, March 1,
1993, April 1, 1993, May 1, 1993, July 1, 1993, August 1, 1993, August 20, 1993, May 1, 1994, February 25, 2003, March 21, 2003, September 23,
2003, March 20, 2006 and January 10, 2008, the latter providing for said series (said indenture as so supplemented and modified being hereinafter referred to as the “Indenture”), to which Indenture reference is made for a
description of the property mortgaged, the nature and extent of the security, the rights of the holders of the bonds in respect thereof, the terms and conditions upon which the bonds are secured and the restrictions subject to which additional bonds
secured thereby may be issued. To the extent permitted by, and as provided in, the Indenture, modifications or alterations of the Indenture, or of any indenture supplemental thereto, and of the rights and obligations of the Company and of the
holders of the bonds, may be made with the consent of the Company by the affirmative vote, or with the written consent, of the holders of not less than 66  2/3% in principal amount of the bonds then outstanding, and by the affirmative vote, or with the written consent, of the holders of not less than 66  2/3% in principal amount of the bonds of any series then outstanding and affected by such modification or alteration, in case one or more but less than all of
the series of bonds then outstanding under the Indenture are so affected, evidenced, in each case, as provided in the Indenture; provided that any supplemental indenture may be modified in accordance with the provisions contained therein for
its modification; and provided, further, that no such modification or alteration shall be made which will affect the terms of payment of the principal of, or interest or premium on, this bond, or the right of any bondholder to institute suit for the
enforcement of any such payment on or after the respective due dates expressed in this bond, or reduce the percentage required for the taking of any such action. Any such affirmative vote of, or written consent given by, any holder of this bond is
binding upon all subsequent holders hereof as provided in the Indenture. 
 In case an event of default as defined in the
Indenture shall occur, the principal of all the bonds outstanding thereunder may become or be declared due and payable, at the time, in the manner and with the effect provided in the Indenture. 
 The bonds of this series may be redeemed at the option of the Company, in whole or in part at any time and from time to time, at a redemption price equal
to the greater of (1) 100% of the principal amount of the bonds of this series to be redeemed and (2) the sum of the present values of the remaining scheduled payments of principal and interest on such bonds (exclusive of interest accrued
to the redemption date), discounted to the redemption date on a semiannual basis (assuming a 360-day year consisting of twelve 30-day months) at the Treasury Rate plus 25 basis points, plus, in either case, accrued and unpaid interest on the
principal amount being redeemed to such redemption date. 
  

 A-3 

 “Business day” means any day other than a day on which banks in New York City are required or
authorized to be closed. 
 “Comparable Treasury Issue” means the United States Treasury security selected by the Quotation Agent as
having a maturity comparable to the remaining term of the bonds of this series to be redeemed that would be utilized, at the time of selection and in accordance with customary financial practice, in pricing new issues of corporate debt securities of
comparable maturity to the remaining term of such bonds. 
 “Comparable Treasury Price” means with respect to any redemption date
for bonds of this series, the average of two Reference Treasury Dealer Quotations for such redemption date. 
 “Quotation Agent”
means a Reference Treasury Dealer appointed by the Company. 
 “Reference Treasury Dealers” means each of J.P. Morgan Securities
Inc. and one other primary U.S. Government Securities dealer in the United States (a “Primary Treasury Dealer”) selected by Wachovia Capital Markets, LLC, and their respective successors; provided, however, that if any of the foregoing
shall cease to be a Primary Treasury Dealer, the Company shall substitute therefor another Primary Treasury Dealer. 
 “Reference
Treasury Dealer Quotation” means, with respect to each Reference Treasury Dealer and any redemption date, the average, as determined by the Quotation Agent, of the bid and asked prices for the Comparable Treasury Issue (expressed in each case
as a percentage of its principal amount) quoted in writing to the Quotation Agent by such Reference Treasury Dealer at 5:00 p.m., New York City time, on the third business day preceding such redemption date. 
 “Treasury Rate” means, with respect to any redemption date, (1) the yield, under the heading which represents the average for the
immediately preceding week, appearing in the most recently published statistical release designated “H.15(519)” or any successor publication which is published weekly by the Board of Governors of the Federal Reserve System and which
establishes yields on actively traded United States Treasury securities adjusted to constant maturity under the caption “Treasury Constant Maturities,” for the maturity corresponding to the Comparable Treasury Issue (if no maturity is
within three months before or after the maturity date of the bonds of this series to be redeemed, yields for the two published maturities most closely corresponding to the Comparable Treasury Issue shall be determined, and the Treasury Rate shall be
interpolated or extrapolated from such yields on a straight-line basis, rounding to the nearest month) or (2) if such release (or any successor release) is not published during the week preceding the calculation date or does not contain such
yields, the rate per year equal to the semi-annual equivalent yield to maturity of the Comparable Treasury Issue, calculated using a price for the Comparable Treasury Issue (expressed as a percentage of its principal amount) equal to the Comparable
Treasury Price for such redemption date. The Treasury Rate will be calculated on the third business day preceding the redemption date. 
  

 A-4 

 The bonds of this series are also subject to redemption for the Replacement Fund for bonds of this series
provided for in the supplemental indenture dated as of January 10, 2008, providing for this series, or upon application of certain moneys included in the trust estate, at any time or from time to time prior to maturity, at 100% of their
principal amount, in each case together with accrued interest to the date fixed for redemption. 
 Redemption is in every case to be effected
at the office or agency of the Company in the Borough of Manhattan, The City of New York, upon at least thirty, but not more than sixty, days’ prior notice, given by mail as more fully provided in the Indenture. 
 If this bond or any portion hereof ($2,000 and integral multiples of $1,000 in excess thereof) is called for redemption and payment is duly provided,
this bond or such portion thereof shall cease to bear interest from and after the date fixed for such redemption. 
 This bond is
transferable, as provided in the Indenture, by the registered owner hereof in person or by duly authorized attorney, at the office or agency of the Company in the Borough of Manhattan, The City of New York, upon surrender and cancellation of this
bond, and thereupon a new bond of the same series and of like aggregate principal amount will be issued to the transferee in exchange herefor as provided in the Indenture; or the registered owner of this bond, at his option, may surrender the same
for cancellation at said office or agency of the Company and receive in exchange herefor the same aggregate principal amount of bonds of the same series of authorized denominations; all subject to the terms of the Indenture but without payment of
any charges other than a sum sufficient to reimburse the Company for any stamp taxes or other governmental charges incident thereto. 
 This
bond is a company obligation only and no recourse whatsoever, either directly or through the Company or any trustee, receiver, assignee or any other person, shall be had for the payment of the principal of or premium, if any, or interest on this
bond, or for the enforcement of any claim based hereon, or otherwise in respect hereof or of the Indenture, against any promoter, subscriber to the capital stock, incorporator, or any past, present or future stockholder, member, officer or director
of the Company as such, or of any successor or predecessor corporation or entity, whether by virtue of any constitutional provision, statute or rule of law, or by the enforcement of any assessment, penalty, subscription or otherwise, any and all
such liability of promoters, subscribers, incorporators, stockholders, members, officers and directors being waived and released by each successive holder hereof by the acceptance of this bond, and as a part of the consideration for the issue
hereof, and being likewise waived and released by the terms of the Indenture. 
 [END OF BOND FORM] 
  

 A-5 

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

											
	 TEN COM—as tenants in common
	 		  	UNIF GIFT MIN ACT-	  	  
	  	Custodian	  	  

		 		  		  	(Cust)	  		  	(Minor)
	 TEN ENT—as tenants by the entireties
	 		  		  		  		  	
		
	 JT TEN—as joint tenants with rights of survivorship and not as tenants in common
	  	            under Uniform Gifts to
		 		  		  	 Minors Act
	  	  

		 		  		  		  	        (State)	  	
				
	Additional abbreviations may also be used though not on the above list.	  		  		  	
	
	FOR VALUE RECEIVED, the undersigned hereby sell(s) and transfer(s) unto (please insert Social Security or other identifying number of assignee)
	
	PLEASE PRINT OR TYPEWRITE NAME AND ADDRESS, INCLUDING POSTAL ZIP CODE OF ASSIGNEE
	
	the within Bond and all rights thereunder, hereby irrevocably constituting and appointing
	
	agent to transfer said Bond on the books of the Company, with full power of substitution in the premises.
						
	Dated:
                                        
	 		  		  		  		  	
		 		  	NOTICE: The signature to this assignment must correspond with the name as written upon the face of the within instrument in every particular without alteration or enlargement, or any
change whatever.
				
		 		  	 Signature Guarantee:
	  	  

  

 A-6 

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

 

 A-7 

 EXHIBIT B 
 FORM OF DUKE ENERGY CAROLINAS, LLC 
 FIRST AND REFUNDING MORTGAGE BOND, 6.00% SERIES DUE 2038 
 [FACE SIDE OF BOND] 
 [DEPOSITORY LEGEND, IF
APPLICABLE] 
 DUKE ENERGY CAROLINAS, LLC 
 FIRST AND REFUNDING MORTGAGE BOND, 
 6.00% SERIES DUE 2038 
  

			
	No.	 	$
	CUSIP No. 26442CAB0	 	
	ISIN US26442CAB00	 	

 Duke Energy Carolinas, LLC, a North Carolina limited liability company (hereinafter called the
“Company”), for value received, hereby promises to pay to              or registered assigns, the principal sum of
             Dollars on January 15, 2038 in any coin or currency of the United States of America which at the time of payment shall be legal tender for the payment of public and
private debts, at the office or agency of the Company in the Borough of Manhattan, The City of New York, and to pay interest thereon at said office or agency from the interest payment date next preceding the date hereof to which interest on
outstanding bonds of this series has been paid (unless the date hereof is prior to July 15, 2008, in which case from January 10, 2008, and unless the date hereof is subsequent to a record date (as defined below) and prior to the next
succeeding January 15 or July 15, in which case from the next succeeding January 15 or July 15, as the case may be), at the rate of 6.00% per cent per annum, in like coin or currency, semi-annually on January 15 and
July 15 in each year, commencing July 15, 2008, until the principal hereof shall become due and payable. Such interest payments shall be made to the person in whose name this bond is registered at the close of business on the
January 1 or July 1, whether or not a business day, preceding each semi-annual interest payment date (a “record date”) (subject to certain exceptions provided in the Indenture hereinafter mentioned), at his last address as it
shall appear upon the bond register of the Company. 
 The provisions of this bond are continued on the reverse hereof and such continued
provisions shall for all purposes have the same effect as though fully set forth in this place. 
 This bond shall not become or be valid or
obligatory for any purpose until the Trustee shall have signed the form of certificate endorsed hereon. 
  

 B-1 

 IN WITNESS WHEREOF, the Company has caused this instrument to be signed in its name by its President or
one of its Vice Presidents, manually or by facsimile signature, and its corporate seal to be hereto affixed, or a facsimile thereof to be hereon engraved, lithographed or printed, and to be attested by the manual or facsimile signature of its
Secretary or one of its Assistant Secretaries. 
 Dated: 
  

			
	 DUKE ENERGY CAROLINAS, LLC

		
	By:	 	  

	Name:	 	
	Title:	 	

  

	
	 ATTEST:

	
	  

	Name:
	Title:

 CERTIFICATE OF AUTHENTICATION 
 This bond is one of the bonds, of the series designated therein, described in the within-mentioned Indenture. 
  

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

		
	By:	 	  

		 	Authorized Signatory

  

 B-2 

 [REVERSE SIDE OF BOND] 
 This bond is one of the bonds of a series, designated specially as First and Refunding Mortgage
Bonds, 6.00% Series due 2038, of an authorized issue of bonds of the Company, without limit as to aggregate principal amount, designated generally as First and Refunding Mortgage Bonds, all issued and to be issued under and equally and ratably
secured by an indenture dated as of December 1, 1927, duly executed by Duke Power Company, a New Jersey corporation (hereinafter called the “New Jersey Company”), to Guaranty Trust Company of New York, as Trustee (The Bank of New York
Trust Company, N.A. as successor trustee), as supplemented and modified by indentures supplemental thereto, including supplemental indentures dated as of September 1, 1947, February 1, 1949, February 1,
1960, June 15, 1964 (under which the Company succeeded to and was substituted for the New Jersey Company), February 1, 1968, March 1, 1990, May 15, 1990, July 1, 1991, March 1,
1993, April 1, 1993, May 1, 1993, July 1, 1993, August 1, 1993, August 20, 1993, May 1, 1994, February 25, 2003, March 21, 2003, September 23,
2003, March 20, 2006 and January 10, 2008, the latter providing for said series (said indenture as so supplemented and modified being hereinafter referred to as the “Indenture”), to which Indenture reference is made for a
description of the property mortgaged, the nature and extent of the security, the rights of the holders of the bonds in respect thereof, the terms and conditions upon which the bonds are secured and the restrictions subject to which additional bonds
secured thereby may be issued. To the extent permitted by, and as provided in, the Indenture, modifications or alterations of the Indenture, or of any indenture supplemental thereto, and of the rights and obligations of the Company and of the
holders of the bonds, may be made with the consent of the Company by the affirmative vote, or with the written consent, of the holders of not less than 66  2/3% in principal amount of the bonds then outstanding, and by the affirmative vote, or with the written consent, of the holders of not less than 66  2/3% in principal amount of the bonds of any series then outstanding and affected by such modification or alteration, in case one or more but less than all of
the series of bonds then outstanding under the Indenture are so affected, evidenced, in each case, as provided in the Indenture; provided that any supplemental indenture may be modified in accordance with the provisions contained therein for
its modification; and provided, further, that no such modification or alteration shall be made which will affect the terms of payment of the principal of, or interest or premium on, this bond, or the right of any bondholder to institute suit for the
enforcement of any such payment on or after the respective due dates expressed in this bond, or reduce the percentage required for the taking of any such action. Any such affirmative vote of, or written consent given by, any holder of this bond is
binding upon all subsequent holders hereof as provided in the Indenture. 
 In case an event of default as defined in the
Indenture shall occur, the principal of all the bonds outstanding thereunder may become or be declared due and payable, at the time, in the manner and with the effect provided in the Indenture. 
 The bonds of this series may be redeemed at the option of the Company, in whole or in part at any time and from time to time, at a redemption price equal
to the greater of (1) 100% of the principal amount of the bonds of this series to be redeemed and (2) the sum of the present values of the remaining scheduled payments of principal and interest on such bonds (exclusive of interest accrued
to the redemption date), discounted to the redemption date on a semiannual basis (assuming a 360-day year consisting of twelve 30-day months) at the Treasury Rate plus 30 basis points, plus, in either case, accrued and unpaid interest on the
principal amount being redeemed to such redemption date. 
  

 B-3 

 “Business day” means any day other than a day on which banks in New York City are required or
authorized to be closed. 
 “Comparable Treasury Issue” means the United States Treasury security selected by the Quotation Agent as
having a maturity comparable to the remaining term of the bonds of this series to be redeemed that would be utilized, at the time of selection and in accordance with customary financial practice, in pricing new issues of corporate debt securities of
comparable maturity to the remaining term of such bonds. 
 “Comparable Treasury Price” means with respect to any redemption date
for bonds of this series, the average of two Reference Treasury Dealer Quotations for such redemption date. 
 “Quotation Agent”
means a Reference Treasury Dealer appointed by the Company. 
 “Reference Treasury Dealers” means each of J.P. Morgan Securities
Inc. and one other primary U.S. Government Securities dealer in the United States (a “Primary Treasury Dealer”) selected by Wachovia Capital Markets, LLC, and their respective successors; provided, however, that if any of the foregoing
shall cease to be a Primary Treasury Dealer, the Company shall substitute therefor another Primary Treasury Dealer. 
 “Reference
Treasury Dealer Quotation” means, with respect to each Reference Treasury Dealer and any redemption date, the average, as determined by the Quotation Agent, of the bid and asked prices for the Comparable Treasury Issue (expressed in each case
as a percentage of its principal amount) quoted in writing to the Quotation Agent by such Reference Treasury Dealer at 5:00 p.m., New York City time, on the third business day preceding such redemption date. 
 “Treasury Rate” means, with respect to any redemption date, (1) the yield, under the heading which represents the average for the
immediately preceding week, appearing in the most recently published statistical release designated “H.15(519)” or any successor publication which is published weekly by the Board of Governors of the Federal Reserve System and which
establishes yields on actively traded United States Treasury securities adjusted to constant maturity under the caption “Treasury Constant Maturities,” for the maturity corresponding to the Comparable Treasury Issue (if no maturity is
within three months before or after the maturity date of the bonds of this series to be redeemed, yields for the two published maturities most closely corresponding to the Comparable Treasury Issue shall be determined, and the Treasury Rate shall be
interpolated or extrapolated from such yields on a straight-line basis, rounding to the nearest month) or (2) if such release (or any successor release) is not published during the week preceding the calculation date or does not contain such
yields, the rate per year equal to the semi-annual equivalent yield to maturity of the Comparable Treasury Issue, calculated using a price for the Comparable Treasury Issue (expressed as a percentage of its principal amount) equal to the Comparable
Treasury Price for such redemption date. The Treasury Rate will be calculated on the third business day preceding the redemption date. 
  

 B-4 

 The bonds of this series are also subject to redemption for the Replacement Fund for bonds of this series
provided for in the supplemental indenture dated as of January 10, 2008, providing for this series, or upon application of certain moneys included in the trust estate, at any time or from time to time prior to maturity, at 100% of their
principal amount, in each case together with accrued interest to the date fixed for redemption. 
 Redemption is in every case to be effected
at the office or agency of the Company in the Borough of Manhattan, The City of New York, upon at least thirty, but not more than sixty, days’ prior notice, given by mail as more fully provided in the Indenture. 
 If this bond or any portion hereof ($2,000 and integral multiples of $1,000 in excess thereof) is called for redemption and payment is duly provided,
this bond or such portion thereof shall cease to bear interest from and after the date fixed for such redemption. 
 This bond is
transferable, as provided in the Indenture, by the registered owner hereof in person or by duly authorized attorney, at the office or agency of the Company in the Borough of Manhattan, The City of New York, upon surrender and cancellation of this
bond, and thereupon a new bond of the same series and of like aggregate principal amount will be issued to the transferee in exchange herefor as provided in the Indenture; or the registered owner of this bond, at his option, may surrender the same
for cancellation at said office or agency of the Company and receive in exchange herefor the same aggregate principal amount of bonds of the same series of authorized denominations; all subject to the terms of the Indenture but without payment of
any charges other than a sum sufficient to reimburse the Company for any stamp taxes or other governmental charges incident thereto. 
 This
bond is a company obligation only and no recourse whatsoever, either directly or through the Company or any trustee, receiver, assignee or any other person, shall be had for the payment of the principal of or premium, if any, or interest on this
bond, or for the enforcement of any claim based hereon, or otherwise in respect hereof or of the Indenture, against any promoter, subscriber to the capital stock, incorporator, or any past, present or future stockholder, member, officer or director
of the Company as such, or of any successor or predecessor corporation or entity, whether by virtue of any constitutional provision, statute or rule of law, or by the enforcement of any assessment, penalty, subscription or otherwise, any and all
such liability of promoters, subscribers, incorporators, stockholders, members, officers and directors being waived and released by each successive holder hereof by the acceptance of this bond, and as a part of the consideration for the issue
hereof, and being likewise waived and released by the terms of the Indenture. 
 [END OF BOND FORM] 
  

 B-5 

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

											
	TEN COM—as tenants in common	 		  	UNIF GIFT MIN ACT-	 	  
	 	Custodian	 	  

		 		  		 	(Cust)	 		 	(Minor)
	TEN ENT—as tenants by the entireties	 		  		 		 		 	
			
	JT TEN—as joint tenants with rights of survivorship and not as tenants in common	  		 	            under Uniform Gifts to
		 		  		 	Minors Act	 	  

		 		  		 		 	        (State)	 	
				
	Additional abbreviations may also be used though not on the above list.	 		 		 	
	
	FOR VALUE RECEIVED, the undersigned hereby sell(s) and transfer(s) unto (please insert Social Security or other identifying number of assignee)
	
	PLEASE PRINT OR TYPEWRITE NAME AND ADDRESS, INCLUDING POSTAL ZIP CODE OF ASSIGNEE
	
	the within Bond and all rights thereunder, hereby irrevocably constituting and appointing
	
	agent to transfer said Bond on the books of the Company, with full power of substitution in the premises.
						
	Dated:
                                        
	 		  		 		 		 	
			
		 		  	NOTICE: The signature to this assignment must correspond with the name as written upon the face of the within instrument in every particular without alteration or enlargement, or any
change whatever.
				
		 		  	Signature Guarantee:	 	  

  

 B-6 

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

 

 B-7

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