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Retirement Plan Information

Executive officers and other eligible employees of Duke Energy and its affiliated companies participate in the Duke Energy Retirement Cash Balance Plan, a noncontributory, qualified, defined benefit retirement plan. In addition, selected managers are eligible to participate in the Duke Energy Executive Cash Balance Plan, which is a noncontributory, nonqualified, defined benefit retirement plan. A portion of the benefits earned in the Executive Cash Balance Plan is attributable to compensation in excess of the Internal Revenue Service annual compensation limit ($200,000 for 2003) and deferred compensation, as well as reductions caused by maximum benefit limitations that apply to qualified plans from the benefits that would otherwise be provided under the Retirement Cash Balance Plan. The Retirement Benefit Equalization Plan is designed to restore benefit reductions caused by the maximum benefit limitations that apply to qualified plans from benefits that would otherwise be provided under the Retirement Cash Balance Plan for eligible employees who do not participate in the Executive Cash Balance Plan. Benefits under the Retirement Cash Balance Plan, the Executive Cash Balance Plan and the Retirement Benefit Equalization Plan are based on eligible pay, generally consisting of base pay, short-term incentives and lump-sum merit increases. The Retirement Cash Balance Plan and the Retirement Benefit Equalization Plan exclude deferred compensation, other than deferrals pursuant to Sections 401(k) and 125 of the Internal Revenue Code.

Under the benefit accrual formula used to determine benefits under the Retirement Cash Balance Plan and the Executive Cash Balance Plan, an eligible employee's plan account receives a pay credit at the end of each month in which the employee remains eligible and receives eligible pay for services. The monthly pay credit is equal to a percentage of the employee's monthly eligible pay. For most eligible employees, including the Named Executive Officers, the percentage depends on age and completed years of service at the beginning of the year, as shown below:

Age and Service		Monthly Pay Credit Percentage
34 or less		4%
35 to 49		5%
50 to 64		6%
65 or more		7%

In addition, there is an additional 4% pay credit for any portion of eligible pay above the Social Security taxable wage base ($87,000 for 2003). Participant accounts also receive monthly interest credits on their balances. The rate of the interest credit is adjusted quarterly and equals the yield on 30-year U.S. Treasury Bonds during the third week of the last month of the previous quarter, subject to a minimum rate of 4% per year and a maximum rate of 9% per year.

Assuming that the Named Executive Officers currently employed by Duke Energy continue in their present positions at their present salaries until retirement at age 65, their estimated annual pensions in a single life annuity form under the applicable plans attributable to such salaries would be: Fred J. Fowler, $299,462; Richard J. Osborne, $327,270; and Ruth G. Shaw, $253,688. These estimates are calculated assuming interest credits at an annual rate of 4% and using a 2003 Social Security taxable wage base equal to $87,000, increasing 4.5% annually. Richard B. Priory and Richard W. Blackburn retired prior to the normal retirement age of 65 and will be entitled to estimated annual pensions in a single life annuity form commencing at age 65 under the assumptions described above, except for pay credits, of $544,552 and $55,382, respectively. Robert P. Brace was not vested in the Retirement Cash Balance Plan or the Executive Cash Balance Plan at the termination of his employment effective March 1, 2004 . Paul M. Anderson only participates in the Retirement Cash Balance Plan for purposes of determining his eligibility to qualify for early or normal retirement and he does not participate in the Executive Cash Balance Plan.