Common use of Vesting of Phantom Stock Units Clause in Contracts

Vesting of Phantom Stock Units. The specified percentage of the Phantom Stock units subject to this Award, and not previously forfeited, shall vest, with such percentage considered satisfied to the extent such Phantom Stock units have previously vested, as follows: (a) Upon Grantee remaining continuously employed by the Corporation, including Subsidiaries, from the Date of Grant through the Vesting Date, (i) For purposes of vesting under this Section 2(a), if such employment terminates as a result of termination of such employment (1) by the Corporation without “Cause” (as defined in the Employment Agreement) or (2) by the Grantee with “Good Reason” (as defined in the Employment Agreement) or (3) by reason of retirement of the Grantee with approval of the Board of Directors of the Corporation (the “Board”), subject to the timely execution and non-revocation of a release of claims as described in the Employment Agreement, each Phantom Stock unit subject to this Award, which unit has not previously been forfeited or vested, shall continue to vest under this Section 2(a) as if Grantee’s employment had not been terminated (ii) If such employment terminates (1) as the result of Grantee’s death or (2) as the result of Grantee’s disability (meaning any physical or mental illness or injury that precludes Grantee from performing any job for which he is qualified and able to perform based upon his education, training or experience), subject to the timely execution and non-revocation of a release of claims as further described in the Employment Agreement, each Phantom Stock unit subject to this Award, which unit has not previously been forfeited or vested, immediately shall become fully vested. (iii) If such employment terminates as a result of termination of such employment (1) by the Employee other than with “Good Reason” (as defined in the Employment Agreement) and other than by reason of retirement with the approval of the Board or (2) by the Corporation for “Cause” (as defined in the Employment Agreement), each Phantom Stock unit subject to this Award, which unit has not previously been forfeited or vested, shall expire and be forfeited immediately. (iv) In the event that at a time when vesting would otherwise occur under this Section 2(a), Grantee is on an employer-approved, personal leave of absence, then, unless prohibited by law, vesting shall be postponed and shall not occur unless and until Grantee returns to active service in accordance with the terms of the approved personal leave of absence and before January 15 of the calendar year immediately following the calendar year in which occurs the Date of Grant. In the event Grantee does not return to active service from such leave of absence prior to such January 15, any Phantom Stock units covered by this Award that were not vested as of the commencement of such leave shall be immediately forfeited (as if Grantee terminated employment for purposes of Section 4 hereof). (b) If, following the occurrence of a Change in Control (as defined in the Plan as in effect on the effective date of the Employment Agreement) and before vesting or forfeiture, such employment is terminated (1) by the Corporation without “Cause” (as defined in the Employment Agreement), (2) by the Grantee with “Good Reason” (as defined in the Employment Agreement) or (3) by reason of retirement of the Grantee with the approval of the Board, each Phantom Stock unit subject to this Award, which unit has not previously been forfeited or vested, immediately shall become fully vested.

Vesting of Phantom Stock Units. The specified percentage of the Phantom Stock units subject to this Award, and not previously forfeited, shall vest, with such percentage considered satisfied to the extent such Phantom Stock units have previously vested, as follows: (a) Upon Grantee remaining continuously employed by the Corporation, including Subsidiaries, from through the specified anniversary of the Date of Grant through the Grant, Vesting Date, (i) Percentage Anniversary For purposes of vesting under this Section 2(a), if such employment terminates as at a result of termination of such employment (1) by time when Grantee is eligible for an immediately payable early or normal retirement benefit under the Corporation without “Cause” (as defined in the Employment Agreement) Duke Energy Retirement Cash Balance Plan or (2) by the Grantee with “Good Reason” (as defined in the Employment Agreement) Cinergy Corp. Non-Union Employees’ Pension Plan, or (3) by reason of under another retirement of the Grantee with approval of the Board of Directors plan of the Corporation (or Subsidiary which plan the Committee, or the delegatee, in its sole discretion, determines to be the functional equivalent of the Duke Energy Retirement Cash Balance Plan or Cinergy Corp. Non-Union Employees’ Pension Plan, Grantee shall be considered to have “Board”)retired” and such employment shall be considered to continue, subject to the timely execution and non-revocation of a release of claims as described in the Employment Agreement, each Phantom Stock unit subject to this Award, which unit has not previously been forfeited or vested, shall continue to vest with continued vesting under this Section 2(a) as if Grantee’s employment had ), unless the Committee or its delegatee, in its sole discretion, determines that Grantee is in violation of any obligation identified in Section 3, in which case any such Phantom Stock units not been terminated (ii) previously vested, or vested by application of the following sentence shall be forfeited, or unless the Grantee dies, in which case the Phantom Stock units subject to this Award shall vest in accordance with the following sentence. If such employment terminates (1i) as the result of Grantee’s death or death, (2ii) as the result of Grantee’s permanent and total disability (within the meaning any physical or mental illness or injury that precludes Grantee from performing any job for which he is qualified and able to perform based upon his education, training or experienceof Code Section 22(e)(3), subject to the timely execution and non-revocation of a release of claims as further described in the Employment Agreement, each Phantom Stock unit subject to this Award, which unit has not previously been forfeited or vested, immediately shall become fully vested. (iii) If such employment terminates as a the result of termination of such employment (1) by the Employee Corporation, or employing Subsidiary, other than with “Good Reason” for cause, as determined by the Committee or its delegatee, or (iv) as defined the direct and sole result, as determined by the Committee or its delegatee, in the Employment Agreement) and other than by reason of retirement with the approval its sole discretion, of the Board divestiture of assets, a business or (2) a company, by the Corporation for “Cause” (as defined in or a Subsidiary, the Employment Agreement), each Phantom Stock unit units subject to this AwardAward shall vest at such vesting percentage determined by the Committee or its delegatee, in its sole discretion, by prorating from the above schedule to reflect only that portion of the period beginning on the Date of Grant and ending with the anniversary of the Date of Grant during which unit has such employment continued while Grantee was entitled to payment of salary (including any period that employment was deemed to continue prior to the Grantee’s death as a result of his or her “retirement”), and any such Phantom Stock units not then or previously been forfeited or vested, vested shall expire and be forfeited immediately. (iv) forfeited. In the event that at a time when vesting would otherwise occur under this Section 2(a), Grantee is on an employer-approved, personal leave of absence, then, unless prohibited by law, vesting shall be postponed and shall not occur unless and until Grantee returns to active service in accordance with the terms of the approved personal leave of absence and before January 15 the tenth anniversary of the calendar year immediately following the calendar year in which occurs the Date of Grant. In the event Grantee does not return to active service from such leave of absence prior to such January 15, any Phantom Stock units covered by this Award that were not vested as of the commencement of such leave shall be immediately forfeited (as if Grantee terminated employment for purposes of Section 4 hereof). (b) If100%, if, following the occurrence of a Change in Control (as defined in the Plan as in effect on the effective date of the Employment Agreement) and before vesting or forfeiturethe anniversary of such occurrence, such employment is terminated (1) involuntarily, and not for cause, by the Corporation without “Cause” (Corporation, or employing Subsidiary, or their successor, as defined determined by the Committee or its delegate, or their successor, in its sole discretion, other than under circumstances described in the Employment Agreementsecond sentence of Section 2(a), (2) by the Grantee with “Good Reason” (as defined in the Employment Agreement) or (3) by reason of retirement of the Grantee with the approval of the Board, each Phantom Stock unit subject to this Award, which unit has not previously been forfeited or vested, immediately shall become fully vested.

Vesting of Phantom Stock Units. The specified percentage of the Phantom Stock units subject to this Award, and not previously forfeited, shall vest, with such percentage considered satisfied to the extent such Phantom Stock units have previously vested, as follows: (a) Upon Grantee remaining continuously employed by the Corporation, including Subsidiaries, from through the specified anniversary of the Date of Grant through the (each a “Vesting Date,”), with respect to the percentage of Phantom Stock units set forth next to such date: (i) 33-1 3% 1st 66-2/3% 2nd 100% 3rd For purposes of vesting under this Section 2(a), if such employment terminates upon Retirement, which is defined as termination at a result time when Grantee has attained age 55 and has at least five years of termination of such employment (1) by vesting service under the Corporation without “Cause” (as defined in the Employment Agreement) Duke Energy Retirement Cash Balance Plan or (2) by the Grantee with “Good Reason” (as defined in the Employment Agreement) Cinergy Corp. Non-Union Employees’ Pension Plan, or (3) by reason of under another retirement of the Grantee with approval of the Board of Directors plan of the Corporation (or Subsidiary which plan the “Board”)Committee, subject or the delegatee, in its sole discretion, determines to be the timely execution and nonfunctional equivalent of the Duke Energy Retirement Cash Balance Plan or Cinergy Corp. Non-revocation of a release of claims as described in the Employment AgreementUnion Employees’ Pension Plan, each Phantom Stock unit subject then Grantee’s employment shall be considered to this Awardcontinue, which unit has not previously been forfeited or vested, shall continue to vest with continued vesting under this Section 2(a) as if Grantee’s employment had ), unless the Committee or its delegatee, in its sole discretion, determines that Grantee is in violation of any obligation identified in Section 3, in which case any such Phantom Stock units not been terminated (ii) previously vested, or vested by application of the following sentence shall be forfeited, or unless the Grantee dies, in which case the Phantom Stock units subject to this Award shall vest in accordance with the following sentences. If such employment terminates (1i) as the result of Grantee’s death or (2ii) as the result of Grantee’s permanent and total disability (within the meaning any physical or mental illness or injury that precludes Grantee from performing any job for which he is qualified and able to perform based upon his education, training or experienceof Code Section 22(e)(3), subject to the timely execution and non-revocation of a release of claims as further described in the Employment Agreement, each all Phantom Stock unit units subject to this Award, which unit has units have not previously been forfeited or vested, immediately shall become fully vested. (iii) . If such employment terminates (i) as a the result of termination of such employment (1) by the Employee Corporation, or employing Subsidiary, other than with “Good Reason” for cause, as determined by the Committee or its delegatee or (ii) as defined the direct and sole result, as determined by the Committee or its delegatee, in the Employment Agreement) and other than by reason of retirement with the approval its sole discretion, of the Board divestiture of assets, a business or (2) a company, by the Corporation for “Cause” (as defined in or a Subsidiary, the Employment Agreement), each Phantom Stock unit units subject to this AwardAward shall vest at such vesting percentage determined by the Committee or its delegatee, in its sole discretion, by prorating from the above schedule to reflect only that portion of the period beginning on the Date of Grant and ending with the third (3rd) anniversary of the Date of Grant during which unit has such employment continued while Grantee was entitled to payment of salary, and any such Phantom Stock units not then or previously been forfeited vested shall be forfeited. Unless the Grantee would satisfy the definition of Retirement upon termination of employment (i.e., Grantee is “Retirement-eligible”) on the Date of Grant or vestedcould become Retirement-eligible during the vesting period, shall expire and be forfeited immediately. (iv) In in the event that at a time when vesting would otherwise occur under this Section 2(a), ) Grantee is on an employer-approved, personal leave of absence, then, unless prohibited by law, vesting shall be postponed and shall not occur unless and until Grantee returns to active service in accordance with the terms of the approved personal leave of absence and before January 15 14 of the calendar year immediately following the calendar year in which occurs the Date of Grantleave commenced. In the event Grantee does not return to active service from such leave of absence prior to such January 1514 of the calendar year immediately following the calendar year in which the leave commenced, any Phantom Stock units covered by this Award that were not vested as of the commencement of such leave shall be immediately forfeited (as if Grantee terminated employment for purposes of Section 4 hereof). (b) If100%, if, following the occurrence of a Change in Control (as defined in the Plan as in effect on the effective date of the Employment Agreement) and before vesting or forfeiturethe second anniversary of such occurrence, such employment is terminated (1) involuntarily, and not for cause, by the Corporation without “Cause” (Corporation, or employing Subsidiary, as defined in the Employment Agreement), (2) determined by the Grantee with “Good Reason” (as defined Committee or its delegatee in the Employment Agreement) or (3) by reason of retirement of the Grantee with the approval of the Board, each Phantom Stock unit subject to this Award, which unit has not previously been forfeited or vested, immediately shall become fully vestedits sole discretion.

Vesting of Phantom Stock Units. The specified percentage of the Phantom Stock units subject to this Award, and not previously forfeited, shall vest, with such percentage considered satisfied to the extent such Phantom Stock units have previously vested, as follows: (a) Upon Grantee remaining continuously employed by the Corporation, including Subsidiaries, from through the specified anniversary of the Date of Grant through the Vesting Date, (i) Grant, 66-2/3% 2nd 100% 3rd For purposes of vesting under this Section 2(a), if such employment terminates as at a result time when Grantee has attained age 55 and has at least five years of termination of such employment (1) by vesting service under the Corporation without “Cause” (as defined in the Employment Agreement) Duke Energy Retirement Cash Balance Plan or (2) by the Grantee with “Good Reason” (as defined in the Employment Agreement) Cinergy Corp. Non-Union Employees’ Pension Plan, or (3) by reason of under another retirement of the Grantee with approval of the Board of Directors plan of the Corporation (or Subsidiary which plan the Committee, or the delegatee, in its sole discretion, determines to be the functional equivalent of the Duke Energy Retirement Cash Balance Plan or Cinergy Corp. Non-Union Employees’ Pension Plan, Grantee shall be considered to have “Board”)retired” and such employment shall be considered to continue, subject to the timely execution and non-revocation of a release of claims as described in the Employment Agreement, each Phantom Stock unit subject to this Award, which unit has not previously been forfeited or vested, shall continue to vest with continued vesting under this Section 2(a) as if Grantee’s employment had ), unless the Committee or its delegatee, in its sole discretion, determines that Grantee is in violation of any obligation identified in Section 3, in which case any such Phantom Stock units not been terminated (ii) previously vested, or vested by application of the following sentence shall be forfeited, or unless the Grantee dies, in which case the Phantom Stock units subject to this Award shall vest in accordance with the following sentences. If such employment terminates (1i) as the result of Grantee’s death or (2ii) as the result of Grantee’s permanent and total disability (within the meaning any physical or mental illness or injury that precludes Grantee from performing any job for which he is qualified and able to perform based upon his education, training or experienceof Code Section 22(e)(3), subject to the timely execution and non-revocation of a release of claims as further described in the Employment Agreement, each all Phantom Stock unit units subject to this Award, which unit has units have not previously been forfeited or vested, immediately shall become fully vested. (iii) . If such employment terminates (i) as a the result of termination of such employment (1) by the Employee Corporation, or employing Subsidiary, other than with “Good Reason” for cause, as determined by the Committee or its delegatee or (ii) as defined the direct and sole result, as determined by the Committee or its delegatee, in the Employment Agreement) and other than by reason of retirement with the approval its sole discretion, of the Board divestiture of assets, a business or (2) a company, by the Corporation for “Cause” (as defined in or a Subsidiary, the Employment Agreement), each Phantom Stock unit units subject to this AwardAward shall vest at such vesting percentage determined by the Committee or its delegatee, in its sole discretion, by prorating from the above schedule to reflect only that portion of the period beginning on the Date of Grant and ending with the third (3rd) anniversary of the Date of Grant during which unit has such employment continued while Grantee was entitled to payment of salary, and any such Phantom Stock units not then or previously been forfeited or vested, vested shall expire and be forfeited immediately. (iv) forfeited. In the event that at a time when vesting would otherwise occur under this Section 2(a), Grantee is on an employer-approved, personal leave of absence, then, unless prohibited by law, vesting shall be postponed and shall not occur unless and until Grantee returns to active service in accordance with the terms of the approved personal leave of absence and before January 15 of the calendar year immediately following the calendar year in which occurs the Date of Grantleave commenced. In the event Grantee does not return to active service from such leave of absence prior to such January 1515 of the calendar year immediately following the calendar year in which the leave commenced, any Phantom Stock units covered by this Award that were not vested as of the commencement of such leave shall be immediately forfeited (as if Grantee terminated employment for purposes of Section 4 hereof). (b) If100%, if, following the occurrence of a Change in Control (as defined in the Plan as in effect on the effective date of the Employment Agreement) and before vesting or forfeiturethe second anniversary of such occurrence, such employment is terminated (1) involuntarily, and not for cause, by the Corporation without “Cause” (Corporation, or employing Subsidiary, as defined determined by the Committee or its delegatee in its sole discretion, other than under circumstances described in the Employment Agreementsecond sentence of Section 2(a), (2) by the Grantee with “Good Reason” (as defined in the Employment Agreement) or (3) by reason of retirement of the Grantee with the approval of the Board, each Phantom Stock unit subject to this Award, which unit has not previously been forfeited or vested, immediately shall become fully vested.

Vesting of Phantom Stock Units. The specified percentage of the Phantom Stock units subject to this Award, and not previously forfeited, shall vest, with such percentage considered satisfied to the extent such Phantom Stock units have previously vested, as follows: (a) Upon Grantee remaining continuously employed by the Corporation, including Subsidiaries, from through the specified anniversary of the Date of Grant through the (each a “Vesting Date, (i) ”), with respect to the percentage of Phantom Stock units set forth next to such date: 66-2/3% 2nd 100% 3rd For purposes of vesting under this Section 2(a), if such employment terminates upon Retirement, which is defined as termination at a result time when Grantee has attained age 55 and has at least five years of termination of such employment (1) by vesting service under the Corporation without “Cause” (as defined in the Employment Agreement) Duke Energy Retirement Cash Balance Plan or (2) by the Grantee with “Good Reason” (as defined in the Employment Agreement) Cinergy Corp. Non-Union Employees’ Pension Plan, or (3) by reason of under another retirement of the Grantee with approval of the Board of Directors plan of the Corporation (or Subsidiary which plan the “Board”)Committee, subject or the delegatee, in its sole discretion, determines to be the timely execution and nonfunctional equivalent of the Duke Energy Retirement Cash Balance Plan or Cinergy Corp. Non-revocation of a release of claims as described in the Employment AgreementUnion Employees’ Pension Plan, each Phantom Stock unit subject then Grantee’s employment shall be considered to this Awardcontinue, which unit has not previously been forfeited or vested, shall continue to vest with continued vesting under this Section 2(a) as if Grantee’s employment had ), unless the Committee or its delegatee, in its sole discretion, determines that Grantee is in violation of any obligation identified in Section 3, in which case any such Phantom Stock units not been terminated (ii) previously vested, or vested by application of the following sentence shall be forfeited, or unless the Grantee dies, in which case the Phantom Stock units subject to this Award shall vest in accordance with the following sentences. If such employment terminates (1i) as the result of Grantee’s death or (2ii) as the result of Grantee’s permanent and total disability (within the meaning any physical or mental illness or injury that precludes Grantee from performing any job for which he is qualified and able to perform based upon his education, training or experienceof Code Section 22(e)(3), subject to the timely execution and non-revocation of a release of claims as further described in the Employment Agreement, each all Phantom Stock unit units subject to this Award, which unit has units have not previously been forfeited or vested, immediately shall become fully vested. (iii) . If such employment terminates (i) as a the result of termination of such employment (1) by the Employee Corporation, or employing Subsidiary, other than with “Good Reason” for cause, as determined by the Committee or its delegatee or (ii) as defined the direct and sole result, as determined by the Committee or its delegatee, in the Employment Agreement) and other than by reason of retirement with the approval its sole discretion, of the Board divestiture of assets, a business or (2) a company, by the Corporation for “Cause” (as defined in or a Subsidiary, the Employment Agreement), each Phantom Stock unit units subject to this AwardAward shall vest at such vesting percentage determined by the Committee or its delegatee, in its sole discretion, by prorating from the above schedule to reflect only that portion of the period beginning on the Date of Grant and ending with the third (3rd) anniversary of the Date of Grant during which unit has such employment continued while Grantee was entitled to payment of salary, and any such Phantom Stock units not then or previously been forfeited or vestedvested shall be forfeited. Unless the Grantee’s right to receive payment of the Phantom Stock units constitutes a “deferral of compensation” within the meaning of Section 409A of the Code, shall expire and be forfeited immediately. (iv) In in the event that at a time when vesting would otherwise occur under this Section 2(a), ) Grantee is on an employer-approved, personal leave of absence, then, unless prohibited by law, vesting shall be postponed and shall not occur unless and until Grantee returns to active service in accordance with the terms of the approved personal leave of absence and before January 15 14 of the calendar year immediately following the calendar year in which occurs the Date of Grantleave commenced. In the event Grantee does not return to active service from such leave of absence prior to such January 1514 of the calendar year immediately following the calendar year in which the leave commenced, any Phantom Stock units covered by this Award that were not vested as of the commencement of such leave shall be immediately forfeited (as if Grantee terminated employment for purposes of Section 4 hereof). (b) If100%, if, following the occurrence of a Change in Control (as defined in the Plan as in effect on the effective date of the Employment Agreement) and before vesting or forfeiturethe second anniversary of such occurrence, such employment is terminated (1) involuntarily, and not for cause, by the Corporation without “Cause” (Corporation, or employing Subsidiary, as defined in the Employment Agreement), (2) determined by the Grantee with “Good Reason” (as defined Committee or its delegatee in the Employment Agreement) or (3) by reason of retirement of the Grantee with the approval of the Board, each Phantom Stock unit subject to this Award, which unit has not previously been forfeited or vested, immediately shall become fully vestedits sole discretion.

Vesting of Phantom Stock Units. The specified percentage of the Phantom Stock units subject to this Award, and not previously forfeited, shall vest, with such percentage considered satisfied to the extent such Phantom Stock units have previously vested, as follows: (a) Upon Grantee remaining continuously employed by the Corporation, including Subsidiaries, from through the specified anniversary of the Date of Grant through the Vesting DateGrant, (i) 33—1 3% 1st 66—2 3% 2nd 100% 3rd For purposes of vesting under this Section 2(a), if such employment terminates as at a result time when Grantee has attained age 55 and has at least five years of termination of such employment (1) by vesting service under the Corporation without “Cause” (as defined in the Employment Agreement) Duke Energy Retirement Cash Balance Plan or (2) by the Grantee with “Good Reason” (as defined in the Employment Agreement) Cinergy Corp. Non-Union Employees’ Pension Plan, or (3) by reason of under another retirement of the Grantee with approval of the Board of Directors plan of the Corporation (or Subsidiary which plan the Committee, or the delegatee, in its sole discretion, determines to be the functional equivalent of the Duke Energy Retirement Cash Balance Plan or Cinergy Corp. Non-Union Employees’ Pension Plan, Grantee shall be considered to have “Board”)retired” and such employment shall be considered to continue, subject to the timely execution and non-revocation of a release of claims as described in the Employment Agreement, each Phantom Stock unit subject to this Award, which unit has not previously been forfeited or vested, shall continue to vest with continued vesting under this Section 2(a) as if Grantee’s employment had ), unless the Committee or its delegatee, in its sole discretion, determines that Grantee is in violation of any obligation identified in Section 3, in which case any such Phantom Stock units not been terminated (ii) previously vested, or vested by application of the following sentence shall be forfeited, or unless the Grantee dies, in which case the Phantom Stock units subject to this Award shall vest in accordance with the following sentences. If such employment terminates (1i) as the result of Grantee’s death or (2ii) as the result of Grantee’s permanent and total disability (within the meaning any physical or mental illness or injury that precludes Grantee from performing any job for which he is qualified and able to perform based upon his education, training or experienceof Code Section 22(e)(3), subject to the timely execution and non-revocation of a release of claims as further described in the Employment Agreement, each all Phantom Stock unit units subject to this Award, which unit has units have not previously been forfeited or vested, immediately shall become fully vested. (iii) . If such employment terminates (i) as a the result of termination of such employment (1) by the Employee Corporation, or employing Subsidiary, other than with “Good Reason” for cause, as determined by the Committee or its delegatee or (ii) as defined the direct and sole result, as determined by the Committee or its delegatee, in the Employment Agreement) and other than by reason of retirement with the approval its sole discretion, of the Board divestiture of assets, a business or (2) a company, by the Corporation for “Cause” (as defined in or a Subsidiary, the Employment Agreement), each Phantom Stock unit units subject to this AwardAward shall vest at such vesting percentage determined by the Committee or its delegatee, in its sole discretion, by prorating from the above schedule to reflect only that portion of the period beginning on the Date of Grant and ending with the third (3rd) anniversary of the Date of Grant during which unit has such employment continued while Grantee was entitled to payment of salary, and any such Phantom Stock units not then or previously been forfeited or vested, vested shall expire and be forfeited immediately. (iv) forfeited. In the event that at a time when vesting would otherwise occur under this Section 2(a), Grantee is on an employer-approved, personal leave of absence, then, unless prohibited by law, vesting shall be postponed and shall not occur unless and until Grantee returns to active service in accordance with the terms of the approved personal leave of absence and before January 15 the second anniversary of the calendar year immediately following commencement of such leave of absence; unless the calendar year Committee or delegatee determines otherwise, in which occurs the Date of Grant. In the event Grantee does not return to active service from such leave of absence prior to the second anniversary of the commencement of such January 15leave of absence, any Phantom Stock units covered by this Award that were not vested as of the commencement of such leave shall be immediately forfeited (as if Grantee terminated employment for purposes of Section 4 hereof). (b) If100%, if, following the occurrence of a Change in Control (as defined in the Plan as in effect on the effective date of the Employment Agreement) and before vesting or forfeiturethe second anniversary of such occurrence, such employment is terminated (1) involuntarily, and not for cause, by the Corporation without “Cause” (Corporation, or employing Subsidiary, as defined determined by the Committee or its delegatee in its sole discretion, other than under circumstances described in the Employment Agreementsecond sentence of Section 2(a), (2) by the Grantee with “Good Reason” (as defined in the Employment Agreement) or (3) by reason of retirement of the Grantee with the approval of the Board, each Phantom Stock unit subject to this Award, which unit has not previously been forfeited or vested, immediately shall become fully vested.

Vesting of Phantom Stock Units. The specified percentage of the Phantom Stock units subject to this Award, and not previously forfeited, shall vest, with such percentage considered satisfied to the extent such Phantom Stock units have previously vested, as follows: (a) Upon Grantee remaining continuously employed by the Corporation, including Subsidiaries, from through the specified anniversary of the Date of Grant through the Award, Vesting Date, (i) Percentage Anniversary ------------------ ----------- 20% 1st 40% 2nd 60% 3rd 80% 4th 100% 5th For purposes of vesting under this Section 2(a), if such employment terminates at a time when Grantee is eligible for an immediately payable early or normal retirement benefit under the Duke Energy Retirement Cash Balance Plan, or under another retirement plan of the Corporation or Subsidiary which plan the Committee, or the delegatee, in its sole discretion, determines to be the functional equivalent of the Duke Energy Retirement Cash Balance Plan, Grantee shall be considered to have "retired" and such employment shall be considered to continue, with continued vesting under this Section 2(a), unless the Corporation, in its sole discretion, determines that Grantee is in violation of any obligation identified in Section 3, or until Grantee's death and, upon such determination or death, any such Phantom Stock units not previously vested, or vested by application of the following sentence shall be forfeited. If such employment terminates, and constitutes a "separation from service" under Code Section 409A, (i) as a the result of Grantee's death, (ii) as the result of Grantee's permanent and total disability within the meaning of Code Section 22(e)(3), (iii) as the result of termination of such employment by the Corporation, or employing Subsidiary, other than for cause, as determined by the Corporation, or employing Subsidiary, in its sole discretion, or (1iv) as the direct and sole result, as determined by the Corporation, or employing Subsidiary, in its sole discretion, of the divestiture of assets, a business or a company, by the Corporation without “Cause” (as defined in or a Subsidiary, the Employment Agreement) or (2) by the Grantee with “Good Reason” (as defined in the Employment Agreement) or (3) by reason of retirement of the Grantee with approval of the Board of Directors of the Corporation (the “Board”), subject to the timely execution and non-revocation of a release of claims as described in the Employment Agreement, each Phantom Stock unit units subject to this AwardAward shall vest at such vesting percentage determined by the Committee, or its delegatee, in its sole discretion, by prorating from the above schedule to reflect only that portion of the period beginning on the Date of Award and ending with the fifth (5th) anniversary of the Date of Award during which unit has not previously been forfeited or vested, shall continue to vest under this Section 2(a) as if Grantee’s employment had not been terminated (ii) If such employment terminates (1) as the result continued while Grantee was entitled to payment of Grantee’s death or (2) as the result of Grantee’s disability (meaning salary, and any physical or mental illness or injury that precludes Grantee from performing any job for which he is qualified and able to perform based upon his education, training or experience), subject to the timely execution and non-revocation of a release of claims as further described in the Employment Agreement, each such Phantom Stock unit subject to this Award, which unit has units not then or previously been forfeited or vested, immediately vested shall become fully vested. (iii) If such employment terminates as a result of termination of such employment (1) by the Employee other than with “Good Reason” (as defined in the Employment Agreement) and other than by reason of retirement with the approval of the Board or (2) by the Corporation for “Cause” (as defined in the Employment Agreement), each Phantom Stock unit subject to this Award, which unit has not previously been forfeited or vested, shall expire and be forfeited immediately. (iv) forfeited. In the event that at a time when vesting would otherwise occur under this Section 2(a), Grantee is on an employer-approved, personal leave of absence, then, unless prohibited by law, vesting shall be postponed and shall not occur unless and until Grantee returns to active service in accordance with the terms of the approved personal leave of absence and before January 15 the tenth anniversary of the calendar year immediately following the calendar year in which occurs the Date of Grant. In the event Grantee does not return to active service from such leave of absence prior to such January 15, any Phantom Stock units covered by this Award that were not vested as of the commencement of such leave shall be immediately forfeited (as if Grantee terminated employment for purposes of Section 4 hereof)Award. (b) If100%, if, following the occurrence of a Change in Control (as defined in the Plan as in effect on the effective date of the Employment Agreement) and before vesting or forfeiturethe second anniversary of such occurrence, such employment is terminated (1) involuntarily, and not for cause, by the Corporation without “Cause” (as defined in the Employment Agreement)Corporation, (2) by the Grantee with “Good Reason” (as defined in the Employment Agreement) or (3) by reason of retirement of the Grantee with the approval of the Boardemploying Subsidiary, each Phantom Stock unit subject to this Award, which unit has not previously been forfeited or vested, immediately shall become fully vested.and constitutes a "separation from service" under Code Section 409A.