Document:

Phantom Stock Agreement

 Exhibit 10-18.3 
  
 PHANTOM STOCK AGREEMENT 
  
 This Phantom Stock Agreement (the “Agreement”) has been made as of November 17, 2003 (the “Date of
Award”) between Duke Energy Corporation, a North Carolina corporation, with its principal offices in Charlotte, North Carolina (the “Company”), and Paul M. Anderson (the “Grantee”). 
  
 RECITALS 
  
 Under the Duke Energy Corporation 1998 Long-Term Incentive Plan as amended, and as it may, from time to time, be further
amended (the “Plan”), the Compensation Committee of the Board of Directors of the Company (the “Committee”), or its delegatee, has determined the form of this Agreement and selected the Grantee, as an Employee, to receive the
Phantom Stock award (the “Award”) evidenced by this Agreement and the Phantom Stock units and tandem Dividend Equivalents that are subject hereto. The applicable terms/provisions of the Plan are incorporated in this Agreement by reference,
including the definitions of terms contained in the Plan. 
  
 PHANTOM STOCK AWARD 
  
 In accordance with the
terms of the Plan, the Company has made this Award, effective as of the Date of Award and upon the following terms and conditions: 
  
 Section 1. Number and Nature of Phantom Stock Units and Dividend Equivalents. The number of Phantom Stock units and the number
of tandem Dividend Equivalents subject to this Award are each two hundred eighty-five thousand (285,000). Each Phantom Stock unit represents a right to receive, with respect to vested Phantom Stock units, payment in the form of one share of
Common Stock. Each tandem Dividend Equivalent, until its expiration, represents a right to receive cash payments equivalent in amount to the cash dividends declared and paid on one share of Common Stock. 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 shareholder of the Company by virtue of this Award. 
  
 Section 2. Vesting of Phantom Stock Units. Phantom Stock units subject to this Award shall vest,
as follows: 
  

			
	 Number

	  	 Upon Grantee remaining continuously
employed with the Corporation and
Subsidiaries from the Date of Award
through the last day of the
Quarter
immediately preceding the vesting date

	 45,000
	  	January 1, 2004
	 20,000
	  	April 1, 2004
	 20,000
	  	July 1, 2004
	 20,000
	  	October 1, 2004
	 20,000
	  	January 1, 2005
	 20,000
	  	April 1, 2005
	 20,000
	  	July 1, 2005
	 20,000
	  	October 1, 2005
	 20,000
	  	January 1, 2006
	 20,000
	  	April 1, 2006
	 20,000
	  	July 1, 2006
	 20,000
	  	October 1, 2006
	 20,000
	  	January 1, 2007

  

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 In the event that the Grantee’s continuous employment by the Company (including Subsidiaries) terminates, any then
unvested Phantom Stock units, and tandem Dividend Equivalents, subject to this Award, are thereupon forfeited, except that if such employment terminates as the result of (i) the Grantee’s death, (ii) the Grantee’s permanent and total
disability within the meaning of Code Section 22(e)(3), or (iii) termination of such employment by the Company, or employing Subsidiary, other than For Cause1, the Committee, or its delegatee, shall immediately vest a portion of unvested Phantom Stock units, such portion to be equal to (1) the number of full calendar months elapsed between November 1, 2003,
and the date of termination (including November 2003) divided by (2) thirty-eight. Notwithstanding the foregoing, in the event that a Change in Control occurs before the Grantee’s continuous employment by the Company (including Subsidiaries)
terminates, any outstanding and unvested Phantom Stock units subject to this Award shall immediately become vested. 
  
 Section 3. Forfeiture/Expiration. Except as otherwise expressly provided herein, any Phantom Stock units subject to
this Award shall be forfeited upon the termination of the Grantee’s continuous employment by the Company (including Subsidiaries) from the Date of Award, to the extent not then or previously vested. Any 

	1	“For Cause”, which is defined as the occurrence of: (A) gross neglect, malfeasance or gross insubordination by the Grantee in performing his duties under
his Employment Agreement; (B) the Grantee’s conviction for a felony, excluding convictions associated with traffic violations; (C) an egregious act of dishonesty (including without limitation theft or embezzlement) or a malicious action by
Grantee toward Duke Energy’s customers or employees; (D) a willful and material violation of any provision of Section 11 of the Grantee’s Employment Agreement; (E) intentional reckless conduct by the Grantee that is materially detrimental
to the business or reputation of Duke Energy; or (F) material failure of the Grantee to carry out reasonably assigned duties or instructions consistent with the titles of Chairman and Chief Executive Officer (provided that material failure to carry
out reasonably assigned duties shall be deemed to constitute cause only after a finding by Duke Energy’s Board of Directors, or a duly constituted committee thereof, of material failure on the part of Grantee and the failure to remedy such
performance to the Board’s or the Committee’s, satisfaction within 30 days after delivery of written notice to Grantee of such finding). 

  

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 Dividend Equivalent subject to this Award shall expire at the time the Phantom Stock unit with respect to which the
Dividend Equivalent is in tandem is either paid or forfeited. 
  
 Section 4. Dividend Equivalent Payments. Payments with respect to any Dividend Equivalent subject to this Award shall be paid in cash to the Grantee (or, if the Grantee is dead, the Grantee’s
beneficiary) as soon as practicable whenever cash dividends are declared and paid with respect to the Common Stock after the Date of Award and before the Dividend Equivalent expires. 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 (or the Grantee’s beneficiary) receives such shares without the right to receive
such dividend and the Grantee (or the Grantee’s beneficiary) would not otherwise be entitled to payment under the expiring tandem Dividend Equivalents with respect to such dividend, the Grantee (or the Grantee’s beneficiary), nevertheless,
shall be entitled to such payment. Dividend Equivalent payments shall be subject to withholding for taxes. 
  
 Section 5. Payment of Phantom Stock Units. Payment under all vested Phantom Stock units subject to this Award shall be
made to the Grantee (or, if the Grantee is dead, the Grantee’s beneficiary) as soon as practicable following the termination of the Grantee’s continuous employment by the Company (including Subsidiaries). In no event will such payment be
made later than the last business day of the month following the month in which his employment with Duke Energy or the employing subsidiary terminates. Payment shall be subject to withholding for taxes and shall not occur until the Grantee (or the
Grantee’s beneficiary) has arranged to meet this obligation to the satisfaction of the Executive Compensation and Benefits Department. Notwithstanding the foregoing, to the extent that Grantee fails to timely tender to the Corporation
sufficient cash to satisfy withholding for tax requirements, such withholding shall be applied to reduce the number of shares of Common Stock that would otherwise be paid. Payment shall be in the form of one (1) share of Common Stock for each full
Phantom Stock unit so vested, and any fractional Phantom Stock unit so vested shall not be paid unless and until subsequent vesting results in the full Phantom Stock unit becoming vested. 
  
 Section 6. No Employment Right. Nothing in this Agreement or in the Plan shall affect the
right of the Company or any Subsidiary to terminate the employment of service of the Grantee at any time for any, or no, reason, or confer upon the Grantee the right to continued employment with the Company (including Subsidiaries). 
  
 Section 7. Restrictions on Transfer,
Beneficiary. Phantom Stock units and Dividend Equivalents subject to this Award may not be sold, transferred, exchanged, assigned, pledged, hypothecated, alienated or otherwise encumbered. The Grantee may designate a beneficiary or
beneficiaries to receive any payments that are due under Section 4 or 5 following Grantee’s death. To be effective, such designation must be made 

  

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in accordance with such rules and on such form as prescribed by the Company’s Executive Compensation and Benefits Department for such purpose which
completed form must be received by the Company’s Executive Compensation and Benefits Department before Grantee’s death. If the Grantee fails to designate a beneficiary or if no designated beneficiary survives Grantee’s death,
Grantee’s estate shall be deemed Grantee’s beneficiary. 
  
 Section 8. Determinations. Determinations by the Committee, or its delegatee, shall be final and conclusive with respect to the interpretation of the Plan and this Agreement. 
  
 Section 9. Governing Law. This Agreement shall be
governed, construed and enforced in accordance with the laws of the State of North Carolina applicable to transactions that take place entirely within that state. 
  
 Section 10. 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 an Award properly granted to the Grantee pursuant to the Plan, the Company, 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. 
  
 Notwithstanding the foregoing, this Award is subject to cancellation by the Company in its sole discretion unless the Grantee, by not later than January
30, 2004, 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 Award (PB04A), Duke Energy Corporation, P. O. Box 1244,
Charlotte, NC 28201-1244. 
  

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

											
	 ATTEST
	 	 	 	DUKE ENERGY CORPORATION
					
	By:	 	/s/    MARTHA B. WYRSCH        	 	 	 	By:	 	/s/    LEO E. LINBECK,
JR.        
	 	 	Corporate Secretary	 	 	 	 	 	Leo E. Linbeck, Jr.
	 	 	 	 	 	 	 	 	 Its:
	 	Chairman, Compensation Committee
	 	 	 	 	 	 	 	 	 	 	 

  
  

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 Acceptance of 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 30th day of December, 2003. 
  

	
	
	 /s/    PAUL M.
ANDERSON        

	 Grantee’s Signature

  

 6Non-Qualified Option Agreement

 Exhibit 10-18.4 
  
 DUKE ENERGY CORPORATION 
 1998 LONG-TERM INCENTIVE PLAN 
  
 NONQUALIFIED STOCK OPTION AGREEMENT 
 (Optionee: Paul M. Anderson 
 November 17, 2003 Grant Date) 
  
 THIS AGREEMENT is made as of the Grant Date specified above (the “Grant Date”), between Duke Energy Corporation, a North Carolina
corporation (the “Corporation”), and the Optionee specified above (the “Optionee”). Except as defined herein, capitalized terms shall have the same meaning ascribed to them in the Duke Energy Corporation 1998 Long-Term Incentive
Plan, as amended, and as may, from time to time, be further amended (the “Plan”). 
  
 1. Grant and Designation of Option. Pursuant to the provisions of the Plan, the Corporation hereby grants to the Optionee, subject to the terms and conditions of the Plan, this Agreement, and the related
Nonqualified Stock Option Certificate specifying the same Optionee and Grant Date as this Agreement, which certificate is incorporated herein by reference (the “Certificate”), the right and option to purchase from the Corporation the
aggregate number of shares of Common Stock set forth on the Certificate at the per share price set forth on the Certificate (the “Option Price”), subject to any adjustment as provided in this Agreement or the Plan (collectively, the
“Option”). The Option is not an incentive stock option within the meaning of Code Section 422A. This Agreement, together with the Certificate, shall constitute an “Award Agreement” under the Plan. 
  
 2. Term of Option and Vesting. Subject to earlier forfeiture,
termination, acceleration or cancellation of the Option as provided in the Plan, this Agreement, or the Certificate, the term of the Option shall be for a period of ten (10) years from the Grant Date. Subject to the 

  

 
provisions of the Plan and this Agreement, the Option shall vest at such times and as to such number of shares as determined on the basis of the schedule set
forth on the Certificate. 
  
 3. Method of Exercise.
To the extent that the right to purchase shares has become vested, the Option, or any part thereof, may be exercised on or after January 1, 2007, or earlier as provided in Section 7, by giving signed, written notice of exercise to the Corporation
(the “Exercise Notice”) specifying the number of shares to be purchased, subject to Section 10. The date of exercise shall be the date the properly completed Exercise Notice is delivered to the Corporation. The Exercise Notice shall be
accompanied by payment of the aggregate Option Price for the shares to be purchased, in the following manner: 
  

	 	(a)	in U.S. dollars by personal check, bank draft or money order payable to the order of the Corporation, or by wire transfer or direct account debit; or 

  

	 	(b)	by delivery of shares of Common Stock or other securities of the Corporation with a Fair Market Value on the date of exercise at least equal to the Option Price for the shares being
purchased, provided, that in the event any such share so delivered was acquired by Optionee pursuant to the Plan, or pursuant to a similar plan of the Corporation or Subsidiary, such share, throughout the six (6) month period immediately preceding
such delivery, must (i) be owned by Optionee, (ii) not have been used or acquired in any “stock for stock” swap transaction, and (iii) not be subject to any restriction upon transferability or other incident of ownership or forfeiture
condition imposed by the respective plan; or 

  

	 	(c)	by combination of the methods described in paragraphs (a) and (b) above. 

  
 For purposes of paragraph (a) above, if, and in such manner, as the Optionee is permitted by the Corporation’s Executive Compensation and Benefits Department, and
which is not contrary to 

  

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federal or state securities or other laws, rules and regulations, the Optionee may provide for the payment of the aggregate Option Price for the shares to be
purchased by delivering a properly executed Exercise Notice together with irrevocable instructions to a broker to promptly deliver to the Corporation the amount of such aggregate Option Price. The Corporation, acting through its Executive
Compensation and Benefits Department, may comply with applicable law by restricting the manner by which the Optionee may pay the Option Price or permitting an alternate method therefore. 
  
 Subject to Section 4 and the other applicable provisions of this Agreement and the Plan, in the event of the exercise of the
Option, the Corporation shall deliver to the Optionee or, if applicable, to a broker designated by the Optionee, a certificate representing the shares of Common Stock purchased as a result of the exercise. 
  
 No partial exercise of the Option may be for fewer than twenty-five (25)
shares or the full number of shares as to which the Option is exercisable at the time of such partial exercise, if less than twenty-five (25) shares. 
  
 4. Tax Withholding. Shares of Common Stock shall not be issued upon the exercise of the Option unless all federal, state and other
governmental withholding tax requirements arising from such exercise have been satisfied by the Optionee or provision therefor has been made to the satisfaction of the Committee in accordance with the Plan. 
  
 5. Nonalienation. The Option granted hereunder is not
assignable or transferable by the Optionee otherwise than (i) by will or the laws of descent and distribution, and is exercisable, during the Optionee’s lifetime, only by the Optionee; or (ii) to the extent authorized in the Certificate. Upon
any attempt to transfer, assign, pledge, hypothecate or otherwise dispose of the Option, or of any right or privilege conferred hereby, contrary to the provisions hereof, or upon the 

  

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levy of any attachment or similar process upon, or other voluntary or involuntary attempted alienation of, the Option, or any right or privilege conferred
hereby, the Option and the right and privilege conferred hereby shall immediately become null and void. 
  
 6. Rights as a Stockholder. The Optionee shall have no rights as a stockholder with respect to any shares of Common Stock subject to
the Option prior to the date of issuance to Optionee of a certificate or certificates for such shares. 
  
 7. Effect of Termination of Employment. Except as otherwise provided in this Section 7, the Option may not be exercised until January 1,
2007, after which date the Option may be exercised provided the Optionee shall have been continuously employed by the Corporation or a Subsidiary from the Grant Date until December 31, 2006. Except as provided in Section 7, the Option shall be
forfeited in the event of termination of such employment. The Committee may make such provision as it deems appropriate if the Optionee is on approved leave of absence from such employment. The Option shall be subject to the following provisions in
the case of the cessation of the Optionee’s employment during the term of the Option: 
  

	 	(a)	If the Optionee shall cease to be employed by the Corporation and all Subsidiaries by reason of (i) an involuntary termination of the Optionee’s employment by the Corporation
or employing Subsidiary, not For Cause1, or (ii) the Optionee’s permanent and total disability within the
meaning of Code Section 22(e)(3) or (iii) 

	1	“For Cause”, which is defined as the occurrence of: (A) gross neglect, malfeasance or gross insubordination by the Optionee in performing his duties under
his Employment Agreement; (B) the Optionee’s conviction for a felony, excluding convictions associated with traffic violations; (C) an egregious act of dishonesty (including without limitation theft or embezzlement) or a malicious action by
Optionee toward Duke Energy’s customers or employees; (D) a willful and material violation of any provision of Section 11 of the Optionee’s Employment Agreement; (E) intentional reckless conduct by the Optionee that is materially
detrimental to the business or reputation of Duke Energy; or (F) material failure of the Optionee to carry out reasonably assigned duties or instructions consistent with the titles of Chairman and Chief Executive Officer (provided that material
failure to carry out reasonably assigned duties shall be deemed to constitute cause only after a finding by Duke Energy’s Board of Directors, or a duly constituted committee thereof, of material failure on the part of Optionee and the failure
to remedy such performance to the Board’s or the Committee’s, satisfaction within 30 days after delivery of written notice to Optionee of such finding). 

  

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the Optionee’s death, the Optionee (or, if the Optionee is dead, the Optionee’s duly appointed legal representative or such other person or persons
to whom the Optionee’s rights under the Option shall pass by the Optionee’s will or the laws of descent and distribution) may, within a period of (A) the remaining term of the Option when such cessation of employment was triggered by
subsection (i) above, or (B) not more than thirty-six (36) months after such cessation of employment when such cessation of employment was triggered by subsections (ii) or (iii) above, exercise the Option, in whole or in part, to the extent of (A)
the number of outstanding shares as to which the Option was vested at the date of such cessation of employment, plus (B) in the event the Option has not become fully vested, such additional number of outstanding shares under the Option the
Committee, or its delegatee, shall immediately vest a portion of the Option, such portion to be equal to (1) the number of full calendar months elapsed between November 1, 2003, and the time of termination (including November 2003) divided by (2)
thirty-eight, and the vested shares under the Option (including those that vest pursuant to the operation of this Section 2) will become immediately exercisable. 

  

	 	(b)	 If the Optionee shall cease to be employed by the Corporation and all Subsidiaries For Cause or any reason other than those set forth in paragraph (a) above, the
Optionee (or, if the Optionee is dead, the Optionee’s duly appointed legal representative or such other person or persons to whom the Optionee’s rights under the Option shall pass by the Optionee’s will or the laws of descent and
distribution) may, within a period of not more than three (3) months after such cessation of employment, exercise the Option, in whole or in part, to the extent of the number of 

  

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outstanding shares as to which the Option was vested at the date of such cessation of employment. 

  
 Notwithstanding, paragraph (a) or (b) above, in no event may the Option be exercised more
than ten (10) years from the Grant Date. 
  
 8.
Adjustments. 
  

	 	(a)	If the outstanding shares of Common Stock shall be changed into or exchanged for a different number or kind of shares of stock or other securities or property of the Corporation or
another corporation (whether by reason of merger, consolidation, recapitalization, reclassification, split up, combination of shares or otherwise), or if the number of such shares of Common Stock shall be increased by a stock dividend or stock
split, there shall be substituted for or added to each share of Common Stock then subject to the Option the number and kind of shares of stock or other securities or property into which each outstanding share of Common Stock shall be so changed, or
for which each such share shall be exchanged, or to which each such share shall be entitled, as the case may be. The Option shall also be amended, as to the shares then subject thereto, as to price and other terms as the Committee may deem necessary
or appropriate to reflect such events. If there shall be any other change in the number or kind of outstanding shares of Common Stock, or of any stock shall have been changed, or for which it shall have been exchanged, and if the Committee shall in
its sole discretion determine that such change equitably requires an adjustment in the Option, such adjustment shall be made by the Committee and shall be effective and binding upon the Optionee. In making any such substitution or adjustment
pursuant to this Section 8, fractional shares may be ignored. 

  

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	 	(b)	The Committee shall have the power, in the event of any merger or consolidation of the Corporation with or into any other corporation, or the merger or consolidation of any other
corporation with or into the Corporation, to amend the Option to permit the exercise thereof in whole or in part at any time, or from time to time, prior to the effective date of any such merger or consolidation and to terminate the Option as of
such effective date. In no event may the Option be exercised more than ten (10) years from the Grant Date. 

  
 9. Effect of Change in Control. In addition to any other adjustments or modification to the Option as the Committee deems appropriate under
the Plan or this Agreement to maintain and protect the rights and interests of the Optionee, in the event of a Change of Control, the Option shall immediately vest in whole or in part with respect to all of the shares as to which such Option remains
outstanding and unexercised and unforfeited, notwithstanding the schedule set forth on the Certificate. 
  
 10. Notices. Except as otherwise provided in this Agreement, any notice to be given to the Corporation under this Agreement shall be
addressed to the Executive Compensation and Benefits Department—Stock Option (PB04A), Duke Energy Corporation at P.O. Box 1244, Charlotte, North Carolina 28201-1244, and any notice to be given to the Optionee under this Agreement shall be
addressed to the Optionee at the address for the Optionee obtained from the records of the Corporation’s Executive Compensation and Benefits Department; provided, however, that either party may substitute a different address by notice in
writing to the other. Except as otherwise provided in this Agreement, any such notice shall be deemed to have been duly given if and when enclosed in a properly sealed envelope addressed as aforesaid and deposited, postage prepaid, in a post office
or branch post office regularly maintained by the United States Government. 
  

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 11. No Employment Rights. Nothing in the Plan, this Agreement or the Certificate shall
confer upon the Optionee the right to continue in the employment or the service of the Company or any Subsidiary, or affect the right of the Corporation or any Subsidiary to terminate the employment or service of the Optionee at any time for any, or
no, reason. 
  
 12. Successors and
Assigns. This Agreement shall bind and inure to the benefit of, and be enforceable by, the Corporation, and its successors and assigns, and the Optionee, and the Optionee’s successors and assigns expressly permitted by Section 5.

  
 13. Optionee Confidentiality Obligations. In
accepting the Option, Optionee acknowledges that Optionee is obligated under company policy, and under federal/state law to protect and safeguard the confidentiality of trade secrets and other proprietary and confidential information belonging to
the Corporation and the Subsidiaries that are acquired by Optionee during Optionee’s employment with the Corporation and the Subsidiaries, and that such obligations continue beyond the termination of such employment. Optionee agrees to notify
any subsequent employer of such obligations and that the Corporation and the Subsidiaries, in order to enforce such obligations, may pursue legal recourse not only against Optionee, but against a subsequent employer of Optionee. 

 
 14. Governing Law. This Agreement shall be governed by,
construed and enforced in accordance with the laws of the State of North Carolina applicable to transactions that take place entirely within the State of North Carolina and, where applicable, the laws of the United States. 
  
 15. Determinations. Determinations by the Committee, or its
delegatee, shall be final and conclusive with respect to the interpretation of the Plan, the Certificate or this Agreement. 
  

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 16. Conflicts with Plan and Correction of Errors. In the event that any provision of the
Certificate or this Agreement conflicts in any way with a provision of the Plan, such Plan provision shall be controlling and the applicable provision of the Certificate or this Agreement, as the case may be, 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, the Certificate and this Agreement do not accurately reflect an option properly granted to the Optionee 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. 
  

  
 By their execution of the Certificate, the Corporation and Optionee enter into this Agreement and agree to be bound by its provisions. 
  

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