Exhibit 10.1


INDEPENDENT
DIRECTOR AWARD


PHANTOM
STOCK AWARD AGREEMENT


This
Phantom Stock  Award
Agreement (the “Agreement”) has been made as of           
(the “Date of Grant”) between Duke Energy Corporation,
a Delaware corporation, with its principal offices in Charlotte, North Carolina
(the “Corporation”), and          
(the “Grantee”).


RECITALS


Under
the            as it may,
from time to time, be amended (the “Plan”), the Board of Directors of the
Corporation (the “Board”) has determined the form of this Agreement and
selected the Grantee, as an Independent Director, to receive the award
evidenced by this Agreement (the “Award”) and the Phantom Stock units and
tandem Dividend Equivalents that are subject hereto. The applicable provisions
of the Plan are incorporated in this Agreement by reference, including the
definitions of terms contained in the Plan (unless such terms are otherwise
defined herein).


AWARD


In accordance with the Plan, the Corporation has made this Award,
effective as of the Date of Grant and upon the following terms and conditions:


Section 1.     Number and Nature of Phantom Stock Units and Tandem
Dividend Equivalents. The number of Phantom Stock units and the
number of tandem Dividend Equivalents subject to this Award are each             (     ). Each Phantom Stock unit,
upon becoming vested, before its expiration, represents a right to receive
payment in the form of one (1) share of Common Stock. Each tandem Dividend
Equivalent represents a right to receive cash payments equivalent to the amount
of cash dividends declared and paid on one (1) share of Common Stock after
the Date of Grant and before the Dividend Equivalent expires. Phantom Stock
units and Dividend Equivalents are used solely as units of measurement, and are
not shares of Common Stock and the Grantee is not, and has no rights as, a
stockholder of the Corporation by virtue of this Award.


Section 2.     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
continuously remaining an Independent Director from the Date of Grant through            .


b.              100%, upon Grantee
ceasing to continuously remain an Independent Director, provided such cessation
constitutes a “separation from service” within the meaning of Code Section 409A(a)(2)(A)(i),
(i) after Grantee has attained age sixty-two (62) and has completed at
least ten (10) years of continuous service as an Independent Director
(including, if applicable, continuous service as a member of the board of
directors of Cinergy Corp.), (ii) on or after the date of the annual
meeting of the stockholders of the Corporation coinciding with, or next
following, Grantee’s attainment of age seventy (70), (iii) by reason of
Grantee’s total and permanent disability within the meaning of Code Section 22(e)(3),
or (iv) by reason of Grantee’s death.


c.               100%, upon the
occurrence of a Change in Control, provided such occurrence would satisfy the
distribution requirements of Code Section 409A(a)(2)(A)(v).


Section 3.     Forfeiture/Expiration. Any Phantom
Stock unit subject to this Award shall be forfeited upon Grantee ceasing to
continuously remain an Independent Director from the Date of Grant, except to
the extent otherwise provided in Section 2, and, if not previously vested
and paid, or deferred, or forfeited, shall expire immediately before the tenth
anniversary of the Date of Grant. Any Dividend Equivalent subject to this Award
shall expire at the time the unit of Phantom Stock with respect to which the
Dividend Equivalent is in tandem (i) is vested and paid, or deferred, (ii) is
forfeited, or (iii) expires.


Section 4.     Dividend Equivalent Payments.
Payments with respect to any Dividend Equivalent subject to this Award shall be
paid in cash to the Grantee as soon as practicable following any time cash
dividends are declared and paid with respect to the Common Stock on or after
the Date of Grant and before the Dividend Equivalent expires (but in no event
shall such payment be made later than March 15 of the year following the
calendar year in which the dividends are paid to the holders of Common Stock). However,
should the timing of a particular payment under Section 5 to the Grantee
in shares of Common Stock in conjunction with the timing of a particular cash
dividend declared and paid on Common Stock be such that the Grantee receives
such shares without the right to receive such dividend and the Grantee would
not otherwise be entitled to payment under the expiring Dividend Equivalent
with respect to such dividend, the Grantee, nevertheless, shall be entitled to
such payment.


Section 5.     Payment of Phantom Stock Units. Payment
of Phantom Stock units subject to this Award shall be made to the Grantee as
soon as practicable following the time such units become vested in accordance
with Section 2 prior to their expiration, but in no event later than 30
days following such vesting, except to the extent deferred by Grantee. Payment
shall be in the form of one (1) share of Common Stock for each full vested
unit of Phantom Stock and any partial vested Phantom Stock unit









 



shall be valued on the basis of the corresponding part
of the Fair Market Value of a share of Common Stock on the date the respective
partial Phantom Stock unit became vested and shall be paid in cash.


Section 6.     No Right to Continue to Be an
Independent Director. Nothing in this Agreement or in the Plan shall
confer upon the Grantee the right to continue as an Independent Director or to
be nominated as a candidate for re-election as an Independent Director.


Section 7.     Nonalienation. The
Phantom Stock units and Dividend Equivalents subject to this Award are not
assignable or transferable by the Grantee. Upon any attempt to transfer,
assign, pledge, hypothecate, sell or otherwise dispose of any such Phantom
Stock unit or Dividend Equivalent, or of any right or privilege conferred
hereby, or upon the levy of any attachment or similar process upon such Phantom
Stock unit or Dividend Equivalent, or upon such right or privilege, such
Phantom Stock unit or Dividend Equivalent or right or privilege, shall
immediately become null and void.


Section 8.     Determinations. Determinations by
the Board, or its delegatee, shall be final and conclusive with respect to the
interpretation of the Plan and this Agreement.


Section 9.     Governing Law. The validity and
construction of this Agreement shall be governed by the laws of the state of
Delaware applicable to transactions taking place entirely within that state.


Section 10.   Certain Definitions. The
following shall apply notwithstanding anything in this Agreement or the Plan to
the contrary. The term “Change in Control” has the meaning given such term in Section 12.2
of the Duke Energy Corporation 1998 Long-Term Incentive Plan, as amended; provided,
however, that no Change in Control shall be deemed to occur in respect
of any transactions or events resulting from the separation of the Corporation’s
gas and electric businesses. The term “Independent Director” means a member of
the Board who is not an employee of the Corporation or any entity that is
wholly owned, directly or indirectly, by the Corporation, or any other
affiliate of the Corporation that is so designated, from time to time, by the
Board.


Section 11.   Conflicts with Plan and Correction of Errors.
In the event that any provision of this Agreement conflicts in any way with a
provision of the Plan, such Plan provision shall be controlling and the
applicable provision of this Agreement shall be without force and effect to the
extent necessary to cause such Plan provision to be controlling. In the event
that, due to administrative error, this Agreement does not accurately reflect a
Phantom Stock Award properly granted to Grantee pursuant to the Plan, the
Corporation, acting through its Executive Compensation and Benefits Department,
reserves the right to cancel any erroneous document and, if appropriate, to
replace the cancelled document with a corrected document. It is the intention
of the Corporation and the Grantee that this Award not result in unfavorable
tax consequences to Grantee under Code Section 409A. Accordingly, Grantee
consents to such









 



amendment of this Agreement as the Corporation may
reasonably make in furtherance of such intention, and the Corporation shall
promptly provide, or make available to, Grantee a copy of any such amendment.


NOTWITHSTANDING
THE FOREGOING, this Award is subject to cancellation by the Corporation in its
sole discretion unless the Grantee, by not later than         
has signed a duplicate of this Agreement, in the space provided below, and
returned the signed duplicate to the Executive Compensation and Benefits
Department - Phantom Stock (STO5F), Duke Energy Corporation, P. O. Box
1007, Charlotte, NC 28201-1007, which, if and to the extent permitted may
be accomplished by electronic means.


IN
WITNESS WHEREOF, the Corporation has caused this Agreement to be executed and
granted in Charlotte, North Carolina, to be effective as of the Date of Grant.


	
  ATTEST:

  	
   

  	
  DUKE ENERGY CORPORATION

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  By:

  	
   

  	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
  Corporate Secretary

  	
   

  	
  Its:

  	
   

  	
  Chief Executive Officer

  



 


Acceptance
of Phantom Stock Award


IN
WITNESS OF Grantee’s acceptance of this Award and Grantee’s agreement to be
bound by the provisions of this Agreement and the Plan, Grantee has signed this
Agreement this         day of                      .


	
  

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
  Grantee’s Signature

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
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Election
to Defer


This Agreement (“Agreement”) is made and entered into
as of            by and
between Duke Energy Corporation, a Delaware corporation (the “Company”) and            
(the “Director”).


WHEREAS, the Company and the Director wish to provide for the
deferral of the payment of certain shares of the Company’s common stock (“Common
Stock”) that may be payable upon the vesting of the Phantom Stock Award
Agreement provided to the Director by the Company (the “Award”) in      
in consideration for the Director’s service as a member of the Company’s Board
of Directors (“Board”).


NOW THEREFORE, in consideration of the premises and other
good and valuable consideration, receipt of which is hereby acknowledged, the
Company and the Director hereby agree as follows:


1.   Account.   The Company shall establish a
bookkeeping account for the benefit of the Director (the “Account”). The
balance in the Account shall reflect the shares of Common Stock credited by the
Company, and adjustments thereto for dividend equivalents, in accordance with Section 2
hereof.


2.   Credit to, and Adjustment of, Account.   Effective
upon the vesting of the Director’s Award, the Company shall credit to the
Account the number of shares of Common Stock that otherwise would have been
delivered to the Director pursuant to the Award. The amount credited to the
Account, plus dividend equivalents thereon, shall be deemed to be invested at
all times in shares of Common Stock, in accordance with procedures established
from time to time by the Board or its delegate. The Board or its delegate may
make or provide for such adjustments in the number of shares of Common Stock
credited to the Account as the Board or its delegate, in its sole discretion
exercised in good faith, may determine is equitably required in order to
prevent dilution or enlargement of the Director’s rights that otherwise would
result from (i) any stock dividend, stock split, combination of shares,
recapitalization, or other change in the capital structure of the Company, (ii) any
merger, consolidation, spin-off, split-off, spin-out, split-up, reorganization,
partial or complete liquidation, or other distribution of assets or issuance of
rights or warrants to purchase securities, or (iii) any other corporate
transaction or event having an effect similar to any of the foregoing. In the
event of any such transaction or event, the Board or its delegate, in its sole
discretion exercised in good faith, may provide, in substitution for the Common
Stock credited to the Account, such alternative consideration as it may
determine to be equitable in the circumstances.


3.   Payments to Director.   The Director will
be entitled to receive the shares of Common Stock then-credited to his Account
as soon as administratively practicable following the date on which the
Director ceases to be a director of the Company and its affiliates. The lump
sum payment shall be made in the form of shares of Common Stock, and cash in
lieu of any fractional share. The payment to the Director of a single lump sum
payment shall discharge all obligations of the Company to the Director under









 



this Agreement. Notwithstanding the above, the date on
which the Director ceases to be a director of the Company shall be deemed to
have not occurred for purposes of this Agreement unless such cessation
constitutes a “separation from service” within the meaning of Section 409A
of the Internal Revenue Code of 1986, as amended (the “Code”), and any
regulations promulgated thereunder.


4.   Death.   If
the Director dies before the balance of his Account has been paid to him, the
balance of the Account shall be paid to the Director’s beneficiary in a single
lump sum payment as soon as administratively practicable following the date of
the Director’s death. The lump sum payment shall be made in the form of shares
of Common Stock, and cash in lieu of any fractional share. The Director’s “beneficiary”
is the person or persons, including one or more trusts, designated by the
Director to receive payment of the Account in the event of the death of the
Director on a form provided by the Company. If the Director fails to designate
a beneficiary or designates a beneficiary who fails to survive him, the
Director’s beneficiary shall be his estate.


5.   Administration.   The
Company, through the Board or its delegate, shall be responsible for the
general administration of the Agreement and for carrying out the provisions
hereof. All payments under this Agreement shall be paid by the Company out of
its general assets. No amount payable under this Agreement may be assigned,
transferred, encumbered or subject to any legal process for the payment of any
claim against the Director or his or her beneficiary. This Agreement may be
amended from time to time by a writing signed by both parties hereto which
makes specific reference to this Agreement. This Agreement and the Director’s
rights under it shall be construed and determined in accordance with the laws
of the State of Delaware. This Agreement shall be binding upon the successors
and assigns of the parties hereto.


6.   Compliance with Law.   This
Agreement shall be construed, administered and governed in a manner that is
consistent with, and that satisfies the requirements of, Section 409A of
the Code and any regulations promulgated thereunder, so that taxation to the
Director is deferred under this Agreement until distribution as provided
hereunder.


7.   Tax
Withholding.   To the extent required by law, the Company will withhold
all applicable income and other taxes from amounts otherwise payable under this
Agreement.


IN WITNESS WHEREOF, this
Agreement has been executed and delivered by the parties as of the date first
written above.


	
  DIRECTOR

  	
   

  	
  DUKE ENERGY CORPORATION