Pepco Holdings, Inc. 2015 NON-MANAGEMENT DIRECTOR COMPENSATION ELECTION AGREEMENT

Exhibit 10.42

Pepco Holdings, Inc.

2015 NON-MANAGEMENT DIRECTOR COMPENSATION ELECTION AGREEMENT

I understand that I am permitted to elect, with respect to the compensation due me for my services as a director of Pepco Holdings, Inc. (the “Company”), either (i) to receive my cash compensation currently in the form of cash or (ii) to defer the receipt of my cash compensation under the terms of the Company’s Second Revised and Restated Executive and Director Deferred Compensation Plan (the “Deferred Compensation Plan”). In addition, I understand that I am permitted to elect to receive my stock-based compensation granted pursuant to the terms of the 2012 Long-Term Incentive Plan (the “2012 LTIP”), or to defer the settlement of such stock-based compensation as permitted by the 2012 LTIP pursuant to a deferral program approved by the Board of Directors. If I choose to defer the receipt of my cash compensation, I must also complete and return to the Company the attached Cash Retainer Deferral Allocation Form directing how the deferred funds are to be credited.

I understand that, upon the completion of the proposed merger of a wholly-owned subsidiary of Exelon Corporation with and into the Company, with the Company being the surviving corporation (the “Merger”), each share of Company common stock and each share underlying stock-based awards of the Company will be converted in the right to receive $27.25 in cash, without interest (the “Cash Consideration”). I acknowledge that, if the Merger is consummated, each outstanding restricted stock unit (“RSU”) award (whether vested or unvested) will be automatically converted into the right to receive the Cash Consideration with respect to the number of shares underlying such RSU award in accordance with the terms and conditions of that certain Amended and Restated Agreement and Plan of Merger dated July 18, 2014 (the “Merger Agreement”). I understand that, if the Merger is completed, I will be entitled to receive the Cash Consideration with respect to shares underlying any RSU award I may receive in 2015, as well as all outstanding RSU awards, the settlement of which previously has been deferred by me (a “Deferred Award”). I will receive the Cash Consideration upon the closing of the Merger, or, if I made a prior irrevocable deferral election made with respect to a Deferred Award, at the time I specified in such deferral election.

As a result, with respect to any deferral elections to be made with respect to 2015, I understand that I am being afforded the opportunity hereby to: (i) provide for a contingent and alternate deferral election to the Company phantom shares account of the Deferred Compensation Plan if the Merger is completed during 2015; and (ii) elect to defer the payment of Cash Consideration with respect to Deferred Awards into the Deferred Compensation Plan (other than the Company phantom shares account), which amounts would then become subject to, and distributed to me in accordance with, all of the applicable terms and conditions of the Deferred Compensation Plan.

I am making the following elections with the understanding that the elections (i) will apply to all of the compensation paid to me for service as a director in 2015 (and, if the Merger is completed in 2015, with respect to my (A) prior deferrals of annual retainers and meeting fees that have been credited to my Company phantom shares account under the Deferred Compensation Plan and (B) Cash Consideration that will be deferred in accordance with election(s) I made in prior years with respect to Deferred Award(s)), (ii) once made, cannot be altered or revoked, and (iii) apply to any such compensation paid to me in subsequent years for services as a director of the Company, unless I notify the Company of any changes, either in writing or by execution of a new election form prior to January 1 of the year for which the changes are to take effect.

I hereby elect to receive my compensation for services as a director of the Company as follows (the percentages for each type of compensation must total 100%):

I will receive an annual stock-based retainer award in the form of RSUs (and any associated dividend equivalents) under the 2012 LTIP, to be settled in Common Stock as indicated below:

If you have elected to have all or any portion of your cash retainer(s) or meeting fees credited to your account under the Deferred Compensation Plan, please complete the following:

I hereby elect to have the cash amounts I have deferred under the Deferred Compensation Plan (and accruals thereon) paid to me beginning on the date selected below (check one):

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I hereby elect to have the cash amounts I have deferred under the Deferred Compensation Plan (and accruals thereon) paid to me in the following manner (check one):

YOU MUST COMPLETE THE ATTACHED CASH RETAINER DEFERRAL ALLOCATION FORM TO INDICATE HOW YOU WISH TO HAVE PREVIOUS DEFERRALS OF CASH CREDITED UNDER THE DEFERRED COMPENSATION PLAN, IF THE MERGER IS COMPLETED IN 2015, AND:

IF YOU DO NOT COMPLETE THIS FORM AND YOU ARE DEFERRING OR HAVE DEFERRED CASH INTO THE PHANTOM SHARE ACCOUNT, IF THE MERGER IS COMPLETED IN 2015, SUCH DEFERRALS WILL NO LONGER BE CREDITED TO THE PHANTOM SHARE ACCOUNT AND WILL, BY DEFAULT, BE CREDITED TO THE PRIME RATE ACCOUNT.

If I have elected to defer the settlement of my RSU award (and any associated dividend equivalents) under Item 1.b. above, I hereby elect payment to me (or, if applicable, my beneficiary) in a lump sum solely in shares of Common Stock on one of the dates I designate below (but only to the extent that such award has vested):

More information on the deferral of Stock-Based Awards under the 2012 LTIP is provided in Item 6 below.

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If I have elected under Item 1.b. above to defer the settlement of any RSU award that may be payable to me in 2015, or if I have a prior Deferred Award:

YOU MUST COMPLETE THE ATTACHED LTIP RSU CONVERSION DEFERRAL ALLOCATION FORM TO INDICATE HOW YOU WISH TO HAVE CASH CONSIDERATION CREDITED TO AN ACCOUNT FOR YOUR BENEFIT UNDER THE DEFERRED COMPENSATION PLAN IF:

IF YOU DO NOT COMPLETE THIS FORM AND YOU HAVE A DEFERRED AWARD, THE CASH CONSIDERATION WILL BE DEFERRED UNDER THE DEFERRED COMPENSATION PLAN AND CREDITED BY DEFAULT TO THE PRIME RATE ACCOUNT.

More information on the deferral of Stock-Based Awards under the 2012 Long-Term Incentive Plan is provided in Item 6 below.

With respect to any shares of Common Stock that may be issued upon settlement of an RSU (and any associated dividend equivalents) granted to me under the 2012 LTIP, whether or not deferred under Item 1.b above, please register the stock certificates for those shares in the name set forth below, and provide a mailing or street address for such person:

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I designate the following Beneficiary (or Beneficiaries) to receive any benefits due under the Deferred Compensation Plan and/or the 2012 LTIP in the event of my death (specify full name, relationship and address):

If I have elected in Item 1.b. above to defer settlement of my annual stock-based retainer award (and any associated dividend equivalents), I hereby acknowledge and agree that such deferral shall be subject to the following material terms, which have been approved by the Board of Directors:

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[Signatures appear on following page]

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IN WITNESS WHEREOF, the undersigned has executed this Agreement effective for all purposes as of the      day of             , 2014.

Acknowledged and confirmed this      day of             , 2014

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Pepco Holdings, Inc.

CASH RETAINER DEFERRAL ALLOCATION FORM

Social Security Number:              -              -             

I request that the Company credit my election of my 2015 cash deferred amounts in the Second Revised and Restated Executive and Director Deferred Compensation Plan to the options indicated below:

(Minimum per fund – 10%) (Please be sure your percentages total = 100%)

NOTE: If you have selected the Pepco Holdings Phantom Shares option above for 2015 or prior years, you must also indicate below an alternative election in the event that the Merger is completed during 2015. The alternative election must include at least one of the options indicated below.

Alternative Election for 2015 and Prior Year Deferrals to the Pepco Holdings Phantom Shares Account:

Please indicate below alternative allocation option(s) and percentage(s) for the total amount of amounts credited to the Pepco Holdings Phantom Shares option (including accruals thereon) for 2015 and prior years, which will take effect if and when the Merger is completed during 2015. The total percentages must total to 100%.

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Pepco Holdings, Inc.

LTIP RSU CONVERSION DEFERRAL ALLOCATION FORM

Social Security Number:              -              -             

I wish to defer the receipt of common stock in connection with a 2015 RSU annual retainer award under the 2012 LTIP that I may receive as part of my annual retainer. I understand that my deferral election shall apply to the Cash Consideration payable, upon the completion of the Merger, with respect to such RSU award, which Cash Consideration shall be automatically deferred into the Deferred Compensation Plan. I request that the Company credit my election of such deferred amounts to the options indicated below:

I understand that, if the Merger is completed in 2015, these elections will also apply to Cash Consideration to be received in connection with any of my prior Deferred Awards.

(Minimum per fund – 10%) (Please be sure your percentages total = 100%)

NOTE: If you have elected to defer the settlement of your annual cash retainer and/or meeting fees, you do not need to complete this Form unless you are also deferring in whole or in part any 2015 RSU annual retainer award under the 2012 LTIP that you may receive, or you have a prior Deferred Award. However, you MUST complete the Cash Retainer Deferral Allocation Form on the previous page.

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