SecProbe.io

CORRESP
1
filename1.htm

Correspondence Letter

 October 12, 2007

 VIA
EDGAR SUBMISSION

 Securities and Exchange Commission

 100 F
Street, N.E.

 Washington, D.C. 20549-3561

 Attention: Ellie
Quarles, Mail Stop 3561

Re:
Exelon Corporation

 Definitive 14A

 Filed March 30, 2007

 File No. 1-16169

 Ladies and Gentlemen:

 We are writing in response to the comments contained in the Staff’s comment letter dated August 21, 2007 (the “Comment Letter”) with respect to Exelon Corporation’s (“Exelon”) Definitive 14A, as filed with
the Securities and Exchange Commission on March 30, 2007 (the “proxy statement”).

 For convenience of the Staff’s review, we have set
forth the comments contained in the Staff’s Comment Letter along with Exelon’s responses. All responses to this letter are provided on a supplemental basis.

 * * * *

 Comment:

 Compensation Committee, page 13

1.
Please provide a description of the nature and scope of the compensation consultant’s assignment and the material elements of the instructions or direction given to the
consultant with respect to the performance of its duties under the engagement. See Item 407(e)(3)(iii) of Regulation S-K.

 Response:

 The compensation committee engages a consultant annually. The scope of the duties of Towers Perrin, the compensation
committee’s consultant, is set forth in the scope of work document agreed to between Towers Perrin and the compensation committee. The scope of work document provides that the consultant is to support the committee in executing its duties and
responsibilities with respect to Exelon’s executive compensation programs, including researching, and providing information regarding, market trends and competitive compensation programs and strategies. The consultant attends the
committee’s meetings, as requested. The consultant prepares market data for each senior executive position, including confirming

the company’s compensation strategy and reviewing and confirming the peer group used to prepare the market data. The consultant also provides the
committee with an independent assessment of management recommendations for changes in the compensation structure. The consultant provides market data related to a variety of executive programs as needed, periodic, ad hoc support to the human
resources function on executive compensation matters in support of the consultant’s role in supporting the compensation committee and on its behalf and consistent with the committee’s requirements, and periodic, ad hoc support to the chair
of the committee as needed, including discussing developing executive compensation and related corporate governance trends.

 In future proxy statements,
Exelon will expand the disclosure of the consultant’s role to discuss its nature and scope as well as the material elements of the instructions or directions given to the consultant with respect to the performance of their duties under the
engagement.

 Comment:

 Compensation Committee,
page 13

2.
Please discuss the role of the executive officers in determining or recommending the amount or form of executive and director compensation. See Item 407(e)(3)(ii) of
Regulation S-K. Please consider discussing whether the chief executive officer had the ability to call or attend compensation committee meetings, whether the chief executive officer met with the compensation consultant used by the compensation
committee, whether the chief executive officer retained or had access to any other compensation consultant who influenced your executive compensation and the amount of input the chief executive officer had in developing compensation packages.

 Response:

 Executive officers are
involved in the evaluation of performance and the development of initial recommendations with respect to compensation adjustments; however, the compensation committee (and the full board of directors, with respect to the compensation of the chief
executive officer and the executive vice presidents) makes the final determinations with respect to compensation programs and adjustments. The chief executive officer participates in discussions of these matters (other than his own compensation)
with the committee and the board, but the committee and the board make the final decisions. The chief executive officer cannot call meetings of the compensation committee.

 Executive officers take an active role in evaluating the performance of the executives who report to them, directly or indirectly, and in recommending the amount of compensation their subordinate executives receive.
The compensation function in the human resources group provides the executive officers with market data for each position, derived from the data provided by the consultant to the compensation committee, together with actual compensation data for
each executive. The executive officer reviews such data in conjunction with the annual performance review of the executive to formulate a recommendation for the subordinate executives. These recommendations generally relate to base salary and
whether to apply an individual performance multiplier to the subordinate executive’s annual incentive payout, and if so, the amount of the multiplier. Executive officers generally do not make recommendations with respect to annual and long-term
incentive target percentages, which are within ranges for each level of officer (vice president, senior vice president, and executive vice president) determined by the committee. The chief executive officer reviews all of the recommendations

 2

of the executive officers before they are presented to the compensation committee. Under Exelon’s corporate governance principles, the chief executive
officer is considered an invited guest and attends the meetings of committees, including the compensation committee, except when the compensation committee meets in executive session to discuss, for example, the chief executive officer’s own
compensation. The compensation committee takes the recommendations of the executive officers into account when it determines executive compensation or, in the case of the executive vice presidents, it makes recommendations to the full board of
directors regarding the compensation of such executive officers. The compensation committee determines the amount of the payout of annual and long-term incentives based on the extent to which the criteria for payouts are met and, in the case of
annual incentive compensation awards, taking into account any individual performance multipliers that the compensation committee may determine. The human resources function provide the compensation committee and the board of directors with data
showing the history of the chief executive officer’s compensation and data that analyzes the cost of a range of several alternatives for changes to the chief executive officer’s compensation, but neither the executive officers nor the
chief executive officer makes any recommendation to the compensation committee or the board of directors with respect to the compensation of the chief executive officer.

 The chief executive officer does not have a systematic role in the work of the consultant. In addition to the compensation committee’s consultant, the human resources function from time to time engages the
services of another consultant (from a different firm) in connection with special projects relating to executive compensation. The compensation committee occasionally requests the views of a consultant retained by the human resources function in
order to obtain another view on an emerging issue.

 As disclosed on page 14 of the proxy statement in the paragraph concerning the role of the corporate
governance committee, the corporate governance committee utilizes an independent compensation consultant to assist it in evaluating directors’ compensation, and for this purpose it periodically asks that the compensation committee’s
consultant prepare a study of the compensation of the company’s directors relative to the directors of the same peer group used for executive compensation. This study is used as the basis for the corporate governance committee’s
recommendations to the full board of directors with respect to director compensation.

 In future proxy statements, Exelon will expand the disclosure of the
role of executive officers in recommending the amount and form of executive and director compensation.

 Comment:

 Compensation of Non-Employee Directors, page 18

3.
Please disclose the grant date fair value of the deferred stock unit awards made in 2006 in accordance with FAS 123R. See Instruction to Item 402(k)(2)(iii) of Regulation
S-K.

 Response:

 The values shown in
the table on page 18 for the deferred stock unit awards made in 2006 to non-employee directors are the grant date fair values. In future proxy statements, we will clarify that the values are the grant date fair values under FAS 123-R in a footnote
to the table.

 Comment:

 3

 Compensation Discussion and Analysis, page 26

4.
We refer you to Securities Act Release 8732A, Section II.B.1. As noted in that section, the compensation discussion and analysis should be sufficiently precise to identify
material differences in compensation policies for individual named executive officers. Mr. Rowe’s salary, non-equity incentive compensation and equity awards were significantly higher than amounts given to other named executive officers.
Please supplement the disclosure to explain the reason for the differences in the amounts of compensation awarded to the named executive officers.

 Response:

 There are no material differences in compensation policies for individual executive officers. The
compensation committee carefully considers the roles and responsibilities of each of the named executive officers relative to the peer group, as well as the individual’s performance and contribution in establishing the compensation opportunity
for each named executive officer. The differences in the amounts of compensation awarded to the named executive officers reflect primarily two factors, the differences in the compensation paid to officers in comparable positions in the peer group
and differences in the individual responsibility and experience of the Exelon officers. As disclosed at page 33 of the proxy statement, Mr. Rowe’s target compensation was based on the same factors as the other named executive officers, but
his compensation reflected a greater degree of policy and decision-making authority and a higher level of responsibility with respect to strategic direction and financial and operating results of Exelon. His target compensation was assessed relative
to other CEOs in the peer group and reflects Exelon’s strong performance relative to the peer group.

 Comment:

 Compensation Discussion and Analysis, page 26

5.
Throughout this section, you indicate that you consider a named executive officer’s individual performance in setting compensation. Please discuss how you structure and
implement specific forms of compensation to reflect the named executive officer’s individual performance or contribution that you have taken into consideration. See Item 402(b)(2)(vii) of Regulation S-K.

 Response:

 Individual performance is factored into the setting of
compensation in three ways.

•

 First, base salary adjustments are based on an assessment of the individual’s performance in the preceding year as well as a comparison with market data for
comparable positions in the peer group, as discussed above in the response to Comment 2 regarding the role of executive officers in recommending the amount of compensation.

•

 Second, annual incentive targets are based on the individual’s role in the enterprise — the most senior officers with responsibilities that span specific
business units or functions have a target

 4

based on earnings per share for the company as a whole (Rowe, Skolds, Mehrberg, and Young), while individuals with specific functional or business unit
responsibilities (Clark) have targets based on the performance of that functional or business unit.

•

 Third, consideration is given as to whether an individual performance multiplier would be appropriately applied to the individual’s annual incentive plan
award, based on the individual’s performance. The individual performance multiplier can result in a decision not to make an award or to decrease the award by up to 50% or increase the award by up to 10%.

 Exelon will, as appropriate, add discussion of the role of individual performance in its future compensation discussion and analysis.

 Comment:

 Annual Incentives, page 28

6.
You have not disclosed the financial measures and key performance indicators for the annual incentive plan for 2007 or the total shareholder return goals for awards of
performance share units for 2007. Please disclose or, to the extent you believe disclosure of these targets is not required because it would result in competitive harm, provide us on a supplemental basis a detailed explanation under Instruction 4 to
Item 402(b) of Regulation S-K Interpretations available on out website at www.sec.gov. If disclosure of the performance-related factors would cause competitive harm, please discuss how difficult it will be for the named executive officer
or how likely it will be for you to achieve the target levels or other factors. Please see Instruction 4 to Item 402(b) of Regulation S-K.

 Response:

 Exelon disclosed the financial measures and key performance indicators for the 2006 annual incentive plan at pages 28-29 and
pages 34-35 of the proxy statement, and the total shareholder return goals for awards of performance shares under the 2006 performance share award program at pages 30 and 36 of the proxy statement. Exelon did not disclose the 2007 financial measures
and key performance indicators for the annual incentive plan or the total shareholder return goals for awards of performance share units for 2007 because it does not believe such information to be required under the guidance set forth in Instruction
2 to Item 402(b).

 The first sentence of Instruction 2 to Item 402(b) established the general rule that the compensation discussion and analysis
is to address historical compensation information (i.e., the “information contained in the tables and otherwise disclosed pursuant to” Item 402). The second sentence of this Instruction introduces the possibility that some events that
occur after the end of the fiscal year might nevertheless be subject to disclosure in compensation discussion and analysis. The third sentence of the Instruction clarifies that the post-fiscal year events that must be included in compensation
discussion and analysis are those that “could affect a fair understanding of the named executive’s compensation for the last fiscal year.” Exelon considered the guidance in this third sentence, but did not view the current 2007-year
information, which was constructed in a manner similar to the prior year, to affect the understanding of the prior year information. As such, Exelon does not believe that disclosure of 2007 performance targets was necessary to place its disclosure
in context because this information is not material to an understanding of 2006 compensation. Exelon was also concerned that disclosure of the

 5

2007 information would be confusing to readers seeking to understand the data presented in the tables, which concerns only 2006. Accordingly, Exelon did not
include disclosure of 2007 goals.

 Comment:

 Long-Term Incentives, page 29

7.
Please discuss how the compensation committee determines the amount of long-term equity incentives to allocate to each of the named executive officers. Refer to
Item 401(b)(1)(v) of Regulation S-K.

 Response:

 The compensation committee determined in 2006 that the mix of long-term compensation should be changed to 35% stock options and 65% performance shares, as disclosed on page 29 of the proxy statement. The compensation
committee re