Duke Energy Subsidiary Details Governance, Legal Amid Securitization Focus

TL;DR

Duke Energy's storm funding arm is a complex, low-risk entity focused on securitization, but watch the U.S. Bank legal drama for broader industry implications.

AI Summary

Duke Energy Carolinas SC Storm Funding LLC (DECSCSF), a bankruptcy-remote subsidiary of Duke Energy Carolinas, LLC, filed its 10-K for the fiscal year ended December 31, 2025. This filing primarily details its corporate structure, governance, and legal proceedings, rather than traditional financial performance metrics like revenue or net income, which are omitted per General Instruction J of Form 10-K. Key personnel changes include Nicholas J. Giaimo becoming President, CFO, and Treasurer of DECSCSF in January 2026, and Abigail L. Motsinger appointed Senior Vice President, Chief Accounting Officer, and Controller of Duke Energy Carolinas, LLC, and Manager and Controller of DECSCSF, effective March 2026. The company reported no compensation paid to its managers or executive officers, except for an annual independent manager fee of $2,000 to Global Securitization Services, LLC. A significant legal proceeding involves U.S. Bank National Association, acting as indenture trustee for DECSCSF, facing a lawsuit in the Delaware Court of Chancery regarding student loan-backed securities, captioned 'The National Collegiate Student Loan Master Trust I, et al. v. U.S. Bank National Association, et al.', which was stayed on November 7, 2018. DECSCSF's strategic outlook is tied to its role in securitizing storm recovery property, as evidenced by agreements dated November 25, 2025, including a Storm Recovery Property Servicing Agreement and a Storm Recovery Property Purchase and Sale Agreement.

Why It Matters

This 10-K provides crucial insight into the operational and governance structure of Duke Energy Carolinas SC Storm Funding LLC, a specialized entity designed to manage storm recovery costs through securitization. For investors in Duke Energy Carolinas, LLC, understanding this subsidiary's legal and administrative framework is vital, as it directly impacts how storm-related expenses are financed and recovered, potentially affecting future rate structures and financial stability. The ongoing legal dispute involving U.S. Bank National Association, while not directly against DECSCSF, highlights potential third-party risks in complex financial structures that could indirectly impact investor confidence in similar securitization vehicles. This filing underscores the utility sector's increasing reliance on innovative financing mechanisms to mitigate large, unpredictable costs like storm damage, setting a precedent for other utilities facing similar challenges.

Risk Assessment

Risk Level: low — The risk level is low because Duke Energy Carolinas SC Storm Funding LLC is a bankruptcy-remote subsidiary, specifically designed to isolate financial risks. The filing explicitly states that DECSCSF is a 'wholly owned, bankruptcy remote subsidiary of Duke Energy Carolinas, LLC,' which significantly limits its direct exposure to broader corporate liabilities. Furthermore, the company reported no legal proceedings directly against it, and its executive compensation is minimal at $2,000 annually, indicating a lean operational structure with limited direct financial obligations.

Analyst Insight

Investors should recognize DECSCSF as a specialized financing vehicle for Duke Energy Carolinas, LLC, rather than a standalone operating entity. Monitor the legal proceedings involving U.S. Bank National Association, as it could set precedents for securitization structures, but understand that DECSCSF's bankruptcy-remote status largely insulates it from direct impact.

Executive Compensation

Key Numbers

• $2,000 — Annual Independent Manager Fee (Paid to Global Securitization Services, LLC, representing the only compensation to managers/officers.)
• 2025-12-31 — Fiscal Year End (The period covered by this 10-K filing.)
• 2026-03-26 — Filing Date (Date the 10-K was filed with the SEC.)
• 333-290125-01 — Commission File Number (Unique identifier for Duke Energy Carolinas SC Storm Funding LLC's SEC filings.)
• 1997 — Year Bernard J. Angelo assumed role (Mr. Angelo became Senior Vice President of Global Securitization Services, LLC.)
• 2025-08 — Month Bernard J. Angelo assumed role (Mr. Angelo became Independent Manager of DECSCSF.)
• 2026-01 — Month Nicholas J. Giaimo assumed role (Mr. Giaimo became President, CFO, and Treasurer of DECSCSF.)
• 2026-03 — Month Abigail L. Motsinger assumed role (Ms. Motsinger became Manager and Controller of DECSCSF.)
• 2018-03-09 — Date NCMSLT Action filed (Lawsuit against U.S. Bank National Association was initiated.)
• 2018-11-07 — Date NCMSLT Action stayed (Delaware Court of Chancery ruled to stay the case.)

Key Players & Entities

• Duke Energy Carolinas SC Storm Funding LLC (company) — registrant and bankruptcy-remote subsidiary
• Duke Energy Carolinas, LLC (company) — depositor, sponsor, servicer, and parent company
• Duke Energy Corporation (company) — indirect parent company
• Nicholas J. Giaimo (person) — President, Chief Financial Officer and Treasurer of DECSCSF since January 2026
• Abigail L. Motsinger (person) — Manager and Controller of DECSCSF since March 2026
• Bernard J. Angelo (person) — Independent Manager of DECSCSF since August 2025
• U.S. Bank National Association (company) — indenture trustee and successor special servicer facing a lawsuit
• Global Securitization Services, LLC (company) — recipient of annual independent manager fee of $2,000
• $2,000 (dollar_amount) — annual independent manager fee
• Delaware Court of Chancery (regulator) — court where NCMSLT Action is pending

FAQ

Risk Factors

• Stayed Legal Proceedings [low — legal]: The National Collegiate Student Loan Master Trust I, et al. v. U.S. Bank National Association, et al. lawsuit, initiated on March 9, 2018, involves U.S. Bank National Association as indenture trustee for DECSCSF. This case was stayed on November 7, 2018, in the Delaware Court of Chancery. The implications of this stayed proceeding for DECSCSF are not detailed but represent a past legal entanglement.

Industry Context

Duke Energy Carolinas SC Storm Funding LLC operates within the specialized area of utility storm cost securitization. This niche involves creating financial instruments backed by future storm recovery charges to finance immediate recovery expenses. The broader utility industry is increasingly focused on resilience and infrastructure hardening in the face of climate change, leading to higher capital expenditures and a greater need for innovative financing solutions like those provided by DECSCSF.

Regulatory Implications

As a bankruptcy-remote subsidiary of a regulated utility, DECSCSF is indirectly subject to utility regulatory oversight. The securitization of storm recovery costs must comply with state public utility commission approvals and specific securitization statutes. Any changes in regulatory frameworks regarding storm cost recovery or securitization could significantly impact DECSCSF's operations and the viability of its funding mechanisms.

What Investors Should Do

1. Monitor future filings for details on storm recovery property securitization volumes and terms.
2. Track any developments in the previously stayed legal proceeding involving U.S. Bank National Association.
3. Observe changes in key personnel and their impact on governance and financial oversight.

Key Dates

• 2025-12-31: Fiscal Year End — Marks the end of the reporting period for the 10-K filing.
• 2026-01-01: Nicholas J. Giaimo assumed roles — Mr. Giaimo became President, CFO, and Treasurer of DECSCSF, indicating a change in key financial leadership.
• 2026-03-01: Abigail L. Motsinger assumed roles — Ms. Motsinger became Manager and Controller of DECSCSF, alongside her new role at Duke Energy Carolinas, LLC, signifying a shift in accounting and control oversight.
• 2025-08-01: Bernard J. Angelo assumed role — Mr. Angelo became Independent Manager of DECSCSF, adding to his long tenure at Global Securitization Services, LLC.
• 2018-11-07: NCMSLT Action stayed — The Delaware Court of Chancery stayed the lawsuit involving U.S. Bank National Association as indenture trustee for DECSCSF, marking a pause in a significant legal proceeding.
• 2026-03-26: 10-K Filing Date — The official date the 10-K report was filed with the SEC, making the information publicly available.

Glossary

Bankruptcy-remote subsidiary

A legal entity structured to isolate its assets and liabilities from its parent company, typically to protect those assets in the event of the parent's bankruptcy. (This structure is crucial for DECSCSF as it aims to protect the storm recovery property assets from the financial distress of Duke Energy Carolinas, LLC.)

Securitization

The process of pooling various types of contractual debt (like mortgages, auto loans, or credit card debt) and selling their related cash flows to third-party investors as securities. (DECSCSF's primary function is to securitize storm recovery property, which involves packaging these assets to be sold to investors.)

Indenture Trustee

A financial institution appointed to represent the interests of bondholders in a debt issuance, ensuring the issuer complies with the terms of the indenture agreement. (U.S. Bank National Association serves as the indenture trustee for DECSCSF, highlighting its role in managing the debt instruments issued by the LLC.)

Storm Recovery Property

Assets or financial instruments created or designated to recover costs associated with storm damage and related recovery efforts. (This is the core asset class that DECSCSF is designed to securitize, as indicated by the specific agreements mentioned in the filing.)

Form 10-K

An annual report required by the U.S. Securities and Exchange Commission (SEC) that gives a comprehensive summary of a company's financial performance. (This document is the primary filing detailing DECSCSF's structure, governance, and legal matters, though it omits traditional financial performance metrics.)

Year-Over-Year Comparison

This 10-K filing for the fiscal year ended December 31, 2025, omits traditional financial performance metrics like revenue and net income, as per General Instruction J of Form 10-K. Therefore, a direct comparison of key financial metrics to the previous year is not possible based on the provided information. The filing focuses on corporate structure, governance, and legal proceedings, with new information primarily related to executive appointments in early 2026 and the ongoing nature of a previously stayed legal proceeding.

Key Financial Figures

• $2,000 — n the annual independent manager fee of $2,000 paid to Global Securitization Services,

Filing Documents

• duk-20251231.htm (10-K) — 98KB
• decscsf-20251231xexhibit311.htm (EX-31.1) — 7KB
• decscsf-20251231xexhibit331.htm (EX-33.1) — 50KB
• decscsf-20251231xexhibit332.htm (EX-33.2) — 79KB
• decscsf-20251231xexhibit341.htm (EX-34.1) — 8KB
• decscsf-20251231xexhibit342.htm (EX-34.2) — 7KB
• decscsf-20251231xexhibit351.htm (EX-35.1) — 6KB
• image_0.jpg (GRAPHIC) — 8KB
• image_0a.jpg (GRAPHIC) — 74KB
• image_1a.jpg (GRAPHIC) — 18KB
• image_2a.jpg (GRAPHIC) — 9KB
• 0002082860-26-000003.txt ( ) — 642KB
• duk-20251231.xsd (EX-101.SCH) — 2KB
• duk-20251231_def.xml (EX-101.DEF) — 20KB
• duk-20251231_lab.xml (EX-101.LAB) — 36KB
• duk-20251231_pre.xml (EX-101.PRE) — 21KB
• duk-20251231_htm.xml (XML) — 6KB

Risk Factors

Item 1A. Risk Factors.

Cybersecurity

Item 1C. Cybersecurity.

Unresolved Staff Comments

Item 1B. Unresolved Staff Comments. None.

Legal Proceedings

Item 3. Legal Proceedings. None.

Mine Safety Disclosures

Item 4. Mine Safety Disclosures. None. PART II The following Items have been omitted pursuant to General Instruction J of Form 10-K:

Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities

Item 5. Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities.

Selected Financial Data

Item 6. Selected Financial Data.

Management's Discussion and Analysis of Financial Condition and Results of Operations

Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations.

Quantitative and Qualitative Disclosures About Market Risk

Item 7A. Quantitative and Qualitative Disclosures About Market Risk.

Financial Statements and Supplementary Data

Item 8. Financial Statements and Supplementary Data.

Changes in and Disagreements with Accountants on Accounting and Financial Disclosure

Item 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure.

Controls and Procedures

Item 9A. Controls and Procedures.

Other Information

Item 9B. Other Information. None.

Disclosure Regarding Foreign Jurisdictions that Prevent Inspections

Item 9C. Disclosure Regarding Foreign Jurisdictions that Prevent Inspections. None. PART III

Directors, Executive Officers and Corporate Governance

Item 10. Directors, Executive Officers and Corporate Governance. Following are the managers and executive officers of Duke Energy Carolinas SC Storm Funding LLC ("DECSCSF") as of the date of the report: Name Age Current and Recent Positions Held Nicholas J. Giaimo 44 Senior Vice President, Treasurer and Chief Risk Officer , Duke Energy Carolinas and Duke Energy Corporation. Mr. Giaimo has served in this role since January 2026, when he also assumed his role as President, Chief Financial Officer and Treasurer of DECSCSF. Prior to this, he served as Senior Vice President of Financial Planning & Analysis, from November 2024 to January 2026; Vice President Financial Planning & Analysis from May 2021 to November 2024; Director Financial Planning & Analysis Carolinas Electric Utilities, from August 2019 to May 2021; Director Financial Planning & Analysis and CFO of Natural Gas Segment, from October 2016 to August 2019. During his tenure at Piedmont Natural Gas, Mr. Giaimo served as Assistant Treasurer and Director Investor Relations from November 2014 to October 2016 and Manager Capital Markets and Investor Relations, August 2007 to November 2014. Abigail L. Motsinger 42 Senior Vice President, Chief Accounting Officer and Controller. Ms. Motsinger has been appointed to serve as Senior Vice President, Chief Accounting Officer and Controller, effective March 2026. Prior to that she was Vice President, Investor Relations from November 2022 until March 2026; Director, Jurisdictional Forecasting from May 2021 until November 2022; Investor Relations Manager from November 2017 until May 2021; and, prior to that, in various roles of increasing responsibility since joining Duke Energy in 2010. Her role as Manager and Controller of DECSCSF began in March 2026. Bernard J. Angelo 56 Senior Vice President of Global Securitization Services, LLC. Mr. Angelo assumed his role as Senior Vice President of Global Securitization Services in 1997. In addition, he assumed his role as In

Executive Compensation

Item 11. Executive Compensation. Other than the annual independent manager fee of $2,000 paid to Global Securitization Services, LLC, DECSCSF does not pay any compensation to its managers or executive officers.

Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters

Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters. None.

Certain Relationships and Related Transactions, and Director Independence

Item 13. Certain Relationships and Related Transactions, and Director Independence. None.

Principal Accounting Fees and Services

Item 14. Principal Accounting Fees and Services. Omitted pursuant to General Instruction J of Form 10-K. PART IV

Exhibits and Financial Statement Schedules

Item 15. Exhibits and Financial Statement Schedules. (a)(1) and (a)(2) Financial Statements and Financial Statement Schedules are omitted pursuant to General Instruction J of Form 10-K as listed under Item 8 of this report. (a)(3) and (b) See Exhibit Index included as the last part of this report, which is incorporated herein by reference. (c) Not applicable.

Form 10-K Summary

Item 16. Form 10-K Summary. None.

(b). Significant Obligors of Pool Assets

Item 1112(b). Significant Obligors of Pool Assets. None.

(b)(2). Credit Enhancement and Other Support, Except For Certain Derivative Instruments

Item 1114(b)(2). Credit Enhancement and Other Support, Except For Certain Derivative Instruments. None.

(b). Certain Derivative Instruments

Item 1115(b). Certain Derivative Instruments. None.

Legal Proceedings

Item 1117. Legal Proceedings. U.S. Bank National Association has provided the following information to the depositor: On March 9, 2018, a law firm purporting to represent fifteen Delaware statutory trusts (the "DSTs") that issued securities backed by student loans (the "Student Loans") filed a lawsuit in the Delaware Court of Chancery against U.S. Bank National Association ("U.S. Bank") in its capacities as indenture trustee and successor special servicer, and three other institutions in their respective transaction capacities, with respect to the DSTs and the Student Loans. This lawsuit is captioned The National Collegiate Student Loan Master Trust I, et al. v. U.S. Bank National Association, et al. , C.A. No. 2018-0167-JRS (Del. Ch.) (the "NCMSLT Action"). The complaint, as amended on June 15, 2018, alleged that the DSTs have been harmed as a result of purported misconduct or omissions by the defendants concerning administration of the trusts and special servicing of the Student Loans. Since the filing of the NCMSLT Action, certain Student Loan borrowers have made assertions against U.S. Bank concerning special servicing that appear to be based on certain allegations made on behalf of the DSTs in the NCMSLT Action. U.S. Bank has filed a motion seeking dismissal of the operative complaint in its entirety with prejudice pursuant to Chancery Court Rules 12(b)(1) and 12(b)(6) or, in the alternative, a stay of the case while other prior filed disputes involving the DSTs and the Student Loans are litigated. On November 7, 2018, the Court ruled that the case should be stayed in its entirety pending resolution of the first-filed cases. On January 21, 2020, the Court entered an order consolidating for pretrial purposes the NCMSLT Action and three other lawsuits pending in the Delaware Court of Chancery concerning the DSTs and the Student Loans, which remains pending. U.S. Bank denies liability in the NCMSLT Action and believes it has performed its obligations as inden

Affiliations and Certain Relationships and Related Transactions

Item 1119. Affiliations and Certain Relationships and Related Transactions. DECSCSF is a wholly owned subsidiary of Duke Energy Carolinas, LLC, which is the depositor, sponsor and servicer.

Compliance With Applicable Servicing Criteria

Item 1122. Compliance With Applicable Servicing Criteria. See Exhibits 33.1, 33.2, 34.1, and 34.2 of this Form 10-K.

Servicer Compliance Statement

Item 1123. Servicer Compliance Statement. See Exhibit 35.1 of this Form 10-K. SUPPLEMENTAL INFORMATION TO BE FURNISHED WITH REPORTS FILED PURSUANT TO SECTION 15(d) OF THE ACT BY REGISTRANTS WHICH HAVE NOT REGISTERED SECURITIES PURSUANT TO SECTION 12 OF THE ACT No such annual report, proxy statement, form of proxy or other proxy soliciting material has been sent to the registrant's security holders. The registrant will not be sending an annual report or proxy material to its security holders subsequent to the filing of this form. EXHIBIT INDEX Exhibits filed herewith are designated by an asterisk (*). All exhibits not so designated are incorporated by reference to a prior filing, as indicated. Exhibit No. Description of Exhibit 3.1 Certificate of Formation of Duke Energy Carolinas S C Storm Funding LLC (incorporated by reference to Exhibit 3.1 to Registration Statement on Form SF-1 of Duke Energy Carolinas, LLC and Duke Energy Carolinas SC Storm F unding LLC filed on September 9 , 202 5 ) 3.2 Amended and Restated Limited Liability Company Agreement of Duke Energy Carolinas S C Storm Funding LLC, dated and effective as of November 1 3 , 202 5 (incorporated by reference to Exhibit 3.2 to Form 8-K filed November 25 , 202 5 ) 4.1 Indenture, dated as of November 2 5 , 202 5 , by and between Duke Energy Carolinas S C Storm Funding LLC, and U.S. Bank Trust Company, National Association , as Indenture Trustee and U.S. Bank National Association , as Securities Intermediary and A ccount Bank (incorporated by reference to Exhibit 4.1 to Form 8-K filed November 2 5 , 202 5 ) 4.2 Series Supplement, dated as of November 2 5 , 202 5 , by and between Duke Energy Carolinas S C Storm Funding LLC, and U.S. Bank Trust Company, National Association , as Indenture Trustee (incorporated by reference to Exhibit 4.2 to Form 8-K filed November 2 5 , 202 5 ) 10.1 Storm Recovery Property Servicing Agreement dated as of November 25, 2025 by and between Duke Energy Carolinas S C

SIGNATURES

SIGNATURES Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrants have duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized. Date: March 26, 2026 DUKE ENERGY CAROLINAS SC STORM FUNDING LLC By: /s/ Abigail L. Motsinger Abigail L. Motsinger Controller and Manager DUKE ENERGY CAROLINAS, LLC By: /s/ Abigail L. Motsinger Abigail L. Motsinger Senior Vice President, Chief Accounting Officer and Controller Duke Energy Carolinas, LLC

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