TERMS AND CONDITIONS
Exhibit 10(b)
Progress
Energy, Inc.
Non-transferable
GRANT
TO
Name of the
Employee
(“Grantee”)
by
Progress Energy, Inc. (the “Sponsor”) of # of Units
Restricted
Stock Units (the “Units”) representing the right to earn, on a one-for-one
basis, shares of the Sponsor’s common stock (“Stock”), pursuant to and subject
to the provisions of the Progress Energy, Inc. Amended and Restated 2007 Equity
Incentive Plan (the “Plan”) and to the terms and conditions set forth on the
following pages of this award agreement (“Agreement”). Capitalized
terms used herein and not otherwise defined shall have the meanings assigned to
such terms in the Plan.
By
accepting this award, Grantee shall be deemed to have agreed to the terms and
conditions of this Agreement and the Plan. Unless vesting is
accelerated as provided in section 2 of the Terms and Conditions or otherwise in
the discretion of the Sponsor’s Committee on Organization and Compensation
(“Committee”), the Units shall vest (become non-forfeitable) in 1/3 increments
on each of the 1st, 2nd, and
3rd
anniversaries of the Grant Date.
IN
WITNESS WHEREOF, Progress Energy, Inc. has caused this Agreement to be executed
as of the Grant Date, as indicated below.
| PROGRESS ENERGY, INC. | |
| By: ________________________________________ | |
| Grant Date: ____________________ | |
TERMS
AND CONDITIONS
1. Grant
of Units. Each
Unit represents the right to receive one share of the Sponsor’s Stock on
the terms set forth in this Agreement.
2. Vesting of
Units. The Units have been credited to a bookkeeping account
on behalf of Grantee. The Units will vest and become non-forfeitable
on the earliest to occur of the following (the “Vesting Date”):
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(a)
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As
to one-third of the units on the first anniversary of the Grant Date,
another one-third on the second anniversary of the Grant Date, and the
remaining one-third on the third anniversary of the Grant
Date;
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(b)
|
As
to all of the Units, the termination of Grantee’s employment with the
Company due to death or Disability (as defined for purposes of Code
Section 409A) at least one year following the Grant
Date;
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(c)
As to all of the Units, the involuntary termination of Grantee’s
employment with the Company due to
Divestiture;
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(d)
|
As
to all of the Units, upon the occurrence of a Change in Control (as
defined for purposes of Code Section 409A), if the Units are not assumed
by the surviving company or equitably converted or
substituted;
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(e)
|
As
to all of the Units, upon termination of Grantee’s employment by Sponsor
without Cause at any time after a Change in Control;
or
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(f)
|
As
to all of the Units, upon Grantee’s Normal Retirement on or after
attaining age 65. Upon Grantee’s Early Retirement on or after
age 55 with 10 or more years of service, a prorata percentage of the
then-unvested Units, if any, will vest based upon the number of full
months elapsed between the Grant Date and the date of Early Retirement,
divided by the number of months within the applicable vesting period
described in 2(a) above.
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If
Grantee’s employment terminates prior to the Vesting Date for any reason other
than as described in (b), (c) or (e) or (f) above, Grantee shall forfeit all
right, title and interest in and to the then unvested Units as of the date of
such termination and the unvested Units will be reconveyed to the Sponsor
without further consideration or any act or action by Grantee.
3. Conversion to
Stock. Unless the Units are forfeited prior to the Vesting
Date as provided in Section 2 above, the Units will be converted to Shares on
the later of (i) the Vesting Date, or (ii) if required to comply with Code
Section 409A and Treasury regulations and guidance with respect to such law, the
six-month anniversary of Grantee’s separation from service (the “Conversion
Date”). Such Shares will be registered on the books of the Sponsor in
Grantee’s name as of the Conversion Date and delivered to Grantee within 30 days
thereafter, in certificated or uncertificated form, as the Participant shall
direct.
4. Dividend
Equivalents. If and when cash dividends or other cash
distributions are paid with respect to the Stock while the Units are
outstanding, the dollar amount of such dividends or distributions with respect
to the number of Shares then underlying the Units will be paid to Grantee within
30 days after the date that dividends are paid to shareholders of the
Sponsor.
5. Rights as
Stockholder. Except for the right to receive Dividend
Equivalents as provided in Section 4 above, Grantee shall not have any rights as
a stockholder of the Sponsor with respect to the Units, including voting rights,
until conversion of the Units to shares of Stock. Upon conversion of
the Units into shares of Stock, Grantee will obtain full voting and other rights
as a stockholder of the Sponsor.
6. Restrictions on
Transfer. The Units may not be sold, transferred, exchanged,
assigned, pledged, hypothecated or otherwise encumbered to or in favor of any
party other than the Company, or be subjected to any lien, obligation or
liability of Grantee to any other party other than the Company.
7. No Right of Continued
Employment. Nothing in this Agreement shall interfere with or
limit in any way the right of the Company to terminate Grantee’s employment at
any time, nor confer upon Grantee any right to continue in the employ of the
Company.
8. Payment of
Taxes. The Company has the authority and the right to deduct
or withhold, or require Grantee to remit to the employer, an amount sufficient
to satisfy federal, state, and local taxes (including Grantee’s FICA obligation)
required by law to be withheld with respect to any taxable event arising as a
result of the vesting or settlement of the Units. The obligations of
the Sponsor under this Agreement will be conditional on such payment or
arrangements, and the Sponsor, and, where applicable, its Affiliates will, to
the extent permitted by law, have the right to deduct any such
taxes
from any payment of any kind otherwise due to Grantee. Grantee hereby
authorizes the Company to instruct a third party broker or plan administrator to
sell Shares earned by Grantee upon settlement of the Units in an amount
sufficient to satisfy the amount required to be withheld for tax purposes, and
to remit the cash proceeds from such sale to the Company.
9. Amendment. The
Committee may amend, modify or terminate this Agreement without approval of
Grantee; provided, however, that such amendment, modification or termination
shall not, without Grantee’s consent, reduce or diminish the value of this award
determined as if it had been fully vested (i.e., as if all restrictions on the
Units hereunder had expired) on the date of such amendment or
termination.
10. Plan
Controls. The terms contained in the Plan are incorporated
into and made a part of this Agreement and this Agreement shall be governed by
and construed in accordance with the Plan. In the event of any actual
or alleged conflict between the provisions of the Plan and the provisions of
this Agreement, the provisions of the Plan shall be controlling and
determinative.
11. Successors. This
Agreement shall be binding upon any successor of the Sponsor, in accordance with
the terms of this Agreement and the Plan.
12. Severability. If
any one or more of the provisions contained in this Agreement is invalid,
illegal or unenforceable, the other provisions of this Agreement will be
construed and enforced as if the invalid, illegal or unenforceable provision had
never been included.
13. Notice. Notices
and communications under this Agreement must be in writing and either personally
delivered or sent by registered or certified United States mail, return receipt
requested, postage prepaid. Notices to the Sponsor must be addressed
to:
Progress
Energy, Inc.
000 Xxxxx
Xxxxxxxxxx Xxxxxx
Xxxxxxx,
XX 00000
Attn:
General Counsel
or any
other address designated by the Sponsor in a written notice to Grantee. Notices
to Grantee will be directed to the address of Grantee then currently on file
with the Sponsor, or at any other address given by Grantee in a written notice
to the Sponsor.
