**Exhibit10-g**

 

**TEMPLATE**

 

**PHANTOMSTOCK AGREEMENT FOR**

**EMPLOYEESUNDER THE CINERGY CORP.**

 

**1996LONG-TERM INCENTIVE COMPENSATION PLAN**

 

THIS PHANTOM STOCKAGREEMENT (the “Agreement”), effective as of                               (the “Date of Grant”), is made by and between Cinergy Corp., a Delawarecorporation, and                               (the “Employee”), an employee of Cinergy Corp. or one of its directly orindirectly held majority or greater-owned subsidiaries (collectively referredto herein as the “Company”).

 

WHEREAS, Cinergy Corp.has adopted the Cinergy Corp. 1996 Long-Term Incentive Compensation Plan, asamended from time to time (the “Plan”), pursuant to which the Employee has beengranted the right, contingent upon the Employee satisfying certain vestingrequirements, to receive a lump sum cash payment, the amount of which shall bebased on the value of a certain, predetermined number of shares of CinergyCorp. Common Stock, with par value of $0.01 per share (“Common Stock”), on theterms set forth in this Agreement; and

 

WHEREAS, theparties desire to enter into this Agreement to set forth their understandingswith respect to the contingent right described in this Agreement, suchcontingent right sometimes referred to herein as “Phantom Stock Right.”

 

NOW, THEREFORE, inconsideration of the recitals and the mutual agreements contained in thisAgreement, the parties agree as follows:

 

**1.**                                      **Contingent Award.**

 

(a)                                  **Award of Phantom Stock Right. **Inconsideration of Employee’s service for the Company, Cinergy Corp. herebygrants a Phantom Stock Right to Employee and shall establish an account (the “Account”)in the name of Employee on the books and records of Cinergy Corp. and creditthe Account with               Phantom Stock Right units.  Each Phantom Stock Right unit shall correspondto one share of Common Stock.

 

(b)                                 **Vesting of Phantom Stock Right.** Subjectto earlier forfeiture as described below, the Phantom Stock Right shall becomefully vested in its entirety if the Employee is continuously employed by theCompany from the Date of Grant until the earliest to occur of the followingdates (i)                               ,(ii) the date of the Employee’s death, (iii) the date of the Employee’sinvoluntary “separation from service” (within the meaning of Code Section 409A)other than for Cause during the two-year period beginning on the CinergyEffective Time or (iv) the date of the Employee’s voluntary “separationfrom service” (within the meaning of Code Section 409A) for Good Reasonduring the two-year period beginning on the Cinergy Effective Time.  For purposes of this Agreement, “CinergyEffective Time” has the meaning given to such term in the Agreement and Plan ofMerger by and among Duke Energy Corporation, Cinergy Corp., Deer Holding Corp.,Deer Acquisition Corp. and Cougar Acquisition Corp., dated May 8, 2005.(1)

 

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(1)          Thevesting events for phantom stock grants vary for each participant.  Some phantom stock grants incorporate cliffvesting schedules while others use a graded vesting schedule.  The phantom stock grants may incorporate someor all of the items set forth in Section 1(b).

 

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(c)                                  **Forfeiture of Phantom Stock Right.** The Employee shall forfeit his or her Phantom Stock Right in its entirety if heor she ceases to remain continuously employed by the Company until the date onwhich the Phantom Stock Right vests in accordance with Section 1(b) hereof.

 

(d)                                 **Definitions.**  Where used herein,the terms “Cause” and “Good Reason” shall have the meaning given to such termsin the most recent employment agreement, as amended, in effect for theEmployee.

 

**2.**                                      **Payout Calculation and Form of Payment.**

 

Except as otherwiseprovided herein, in the event that Phantom Stock Right units become fully vestedin accordance with Section 1(b), the Employee shall be entitled to receivea lump sum cash payment equal to the sum of (a) the product of (i) thenumber of Phantom Stock Right units vesting, adjusted as provided in thisAgreement, and (ii) the Fair Market Value (as that term is defined in thePlan) of a share of Common Stock as of the date the Phantom Stock Right unitsvest, plus (b) the product of (i) the number of Phantom Stock Rightunits vesting and (ii) the aggregate amount of cash dividends paid on ashare of Common Stock from the Date of Grant through the date of payment. Such payment shall be made within thirty (30) days following the date on whichthe Phantom Stock Right units become vested.  The Company shall have theright to deduct from all payments made to the Employee pursuant to thisAgreement such federal, state or local taxes as are, in the reasonable opinionof the Company, required to be withheld by the Company with respect to suchpayment.  Notwithstanding the above, ifrequired to comply with Code Section 409A, such payment shall not be madeuntil five (5) days following the 6th month anniversary of theEmployee’s separation from service if the Employee is a “specified employee”within the meaning of Code Section 409A.

 

**3.****                                      Adjustments.**

 

The Committee (as definedin the Plan) may make or provide for such adjustments in the number of PhantomStock Right units covered by this Agreement as the Committee, in its solediscretion exercised in good faith, may determine is equitably required inorder to prevent dilution or enlargement of Employee’s rights that otherwisewould result from (i) any stock dividend, stock split, combination ofshares, recapitalization, or other change in the capital structure of CinergyCorp., (ii) any merger, consolidation, spin-off, split-off, spin-out,split-up, reorganization, partial or complete liquidation, or otherdistribution of assets or issuance of rights or warrants to purchasesecurities, or (iii) any other corporate transaction or event having aneffect similar to any of the foregoing.  In the event of any suchtransaction or event, the Committee, in its sole discretion exercised in goodfaith, may provide, in substitution for the Phantom Stock Right, suchalternative consideration as it may determine to be equitable in thecircumstances and may require in connection therewith the surrender of thePhantom Stock Right.

 

**4.****                                      Transferability.**

 

The contingent rights setforth in this Agreement are not transferable otherwise than by will or the lawsof descent and distribution.

 

**5.****                                      Effect ofAssignment or Pledge.**

 

If the Employee assignsor pledges contingent rights covered by this Agreement or attempts to do so, orif there is a levy, attachment, execution or other legal or equitable processupon the contingent rights, Cinergy Corp. shall have the right to terminatethis Agreement.

 

**6.****                                      Incorporationof the Plan’s Terms.**

 

This Agreement is subjectto all of the terms, provisions and conditions of the Plan, which is

 

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incorporated into thisAgreement by reference, and to such regulations as may from time to time beadopted by the Committee.  A copy of the Plan has been furnished to theEmployee and an additional copy may be obtained from Cinergy Corp.  In theevent of any conflict between the provisions of the Plan and the provisions ofthis Agreement, the terms, conditions and provisions of the Plan shall control,and this Agreement shall be deemed to be modified accordingly.  TheCommittee shall have final authority to interpret and construe the Plan andthis Agreement and to make any and all determinations thereunder, and itsdecision shall be binding and conclusive upon the Employee and his or her legalrepresentative in respect of any questions arising under the Plan, or thisAgreement.

 

**7.****                                      No Right toContinued Employment.**

 

Solely for purposes ofthis Agreement, Employee shall be deemed to be employed by the Company duringall periods in which he or she is receiving benefits under anyCinergy-sponsored short-term or long-term disability plan or program; provided,however, that nothing in this Agreement shall restrict the right of the Companyto terminate the Employee’s employment at any time with or without Cause.

 

**8.****                                      Successors.**

 

The terms of thisAgreement shall be binding upon and inure to the benefit of Cinergy Corp., itssuccessors and assigns, and the Employee and the Employee’s beneficiaries,executors, administrators, heirs and successors.

 

**9.****                                      InvalidProvision.**

 

The invalidity orunenforceability of any particular provision of this Agreement shall not affectthe other provisions of this Agreement, and this Agreement shall be construedin all respects as if such invalid or unenforceable provision has been omitted.

 

**10.****                               Modifications and Section 409Aof the Code.**

 

No change, modificationor waiver of any provision of this Agreement shall be valid unless the same bein writing and signed by the parties.  Tothe extent applicable, it is intended that this Agreement andthe Plan comply with the provisions of Section 409A of the Code,including the provisions requiring a delay in payment.  This Agreement and the Plan shall beadministered in a manner consistent with this intent, andany provision that would cause the Agreement or the Plan to fail tosatisfy Section 409A of the Code shall have no force and effect untilamended to comply with Section 409A of the Code (which amendment may beretroactive to the extent permitted by Section 409A of the Code and may bemade by the Company without the consent of the Employee).

 

**11.****                               Headings.**

 

The headings of theSections of this Agreement are provided for convenience only and are not toserve as a basis for interpretation or construction, and shall not constitute apart of this Agreement.

 

**12.****                               Governing Law.**

 

Except to the extentpre-empted by federal law, this Agreement and the Employee’s rights under itshall be construed and determined in accordance with the laws of the state ofDelaware.

 

**13.****                               Entire Agreement.**

 

This Agreement and thePlan contain the entire agreement and understanding of the parties with respectto the subject matter contained in this Agreement, and supersede all priorcommunications,

 

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representations andnegotiations in respect thereto.

 

**14.****                               Counterparts.**

 

This Agreement may beexecuted in counterparts, each of which shall be deemed an original, but all ofwhich together shall constitute one and the same instrument.

 

**15.****                               Satisfaction of LegalRequirements.**

 

No payment will be madeunder this Agreement until the Company has been advised by counsel that allapplicable legal requirements have been met.

 

**16. ****                            Source of Payment.**

 

Any payments to Employeeunder this Agreement shall be paid from the Company’s general assets, andEmployee shall have the status of a general unsecured creditor with respect tothe Company’s obligations to make payments under this Agreement.  Employeeacknowledges that the Company shall have no obligation to set aside any assetsto fund its obligations under this Agreement.

 

**17.****                               Notices andElectronic Delivery and Signature.**

 

All notices to theCompany shall be addressed to Cinergy Corp., 139 East Fourth Street,Cincinnati, Ohio 45202, Attention: Manager, Compensation, or such other addressor in accordance with such other procedure as the Company may, from time totime, specify. Notwithstanding the foregoing, the Employee hereby consentsand agrees to electronic delivery of any Plan documents, proxy materials,annual reports and other related documents, including all materials required tobe distributed pursuant to applicable securities laws.  If the Companyestablishes procedures for an electronic signature system for delivery andacceptance of Plan documents (including documents relating to any programsadopted under the Plan), the Employee hereby consents to such procedures andagrees that his or her electronic signature is the same as, and shall have thesame force and effect as, his or her manual signature.  The Employeeconsents and agrees that any such procedures and delivery may be effected by athird party engaged by the Company to provide administrative services relatedto the Plan, including any program adopted under the Plan.  The Employeeunderstands that, unless earlier revoked by the Employee, this consent shall beeffective for the duration of the Agreement and that he or she shall have theright at any time to request written copies of any and all materials referredto above.

 

IN WITNESS WHEREOF, thisAgreement has been executed by the parties effective as of the date set forthherein.

 

 
| EMPLOYEE   | CINERGY CORP. |
|------------|---------------|
|       |          |
|       |          |
| Signature: |          |   | By: |   |   |
|            |               |  |  |  |  |

 

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