Progress Energy 2010 Annual Report Download - page 206

PROXY STATEMENT
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4 Amounts shown for restricted stock units are based on a December 31, 2010, closing price of $43.48 per share.
For a detailed description of outstanding restricted stock units, see the “Outstanding Equity Awards at Fiscal Year-End Table.”
Unvested restricted stock units would be forfeited under voluntary termination, involuntary not for cause termination, or for
cause termination. Mr. Yates is not eligible for early retirement or normal retirement. In the event of involuntary or good reason
termination (CIC), all outstanding restricted stock units would vest immediately. Upon death or disability, all outstanding
restricted stock units that are more than one year past their grant date would vest immediately. Shares that are less than one year
past their grant date would be forfeited. Mr. Yates would immediately vest restricted stock units granted in 2007, 2008, and 2009;
and would forfeit restricted stock units granted in 2010.
5 Amounts shown for restricted stock shares are based on a December 31, 2010, closing price of $43.48 per share.
For a detailed description of outstanding restricted stock shares, see the “Outstanding Equity Awards at Fiscal Year-End Table.”
Unvested restricted stock would be forfeited under voluntary termination, involuntary not for cause termination, or for cause
termination. Mr. Yates is not eligible for early retirement or normal retirement. In the event of involuntary or good reason
termination (CIC), all outstanding restricted stock shares would vest immediately. Upon death or disability, all outstanding
restricted stock shares that are more than one year past their grant date would vest immediately. Shares that are less than one year
past their grant date would be forfeited. All of Mr. Yates’ restricted stock grant dates are beyond the one-year threshold; therefore,
all outstanding restricted stock shares would vest immediately.
6 No accelerated vesting or incremental nonqualified pension benefit applies under any of these scenarios. Mr. Yates
was vested under the SERP as of December 31, 2010, so there is no incremental value due to accelerated vesting under
involuntary or good reason termination (CIC).
7 All outstanding deferred compensation balances will be paid immediately following termination, subject to IRC
Section 409(a) regulations, under voluntary termination, involuntary not for cause termination, for cause termination, involuntary
or good reason termination (CIC), death and disability. Mr. Yates is not eligible for early retirement or normal retirement.
Unvested MICP deferral premiums would be forfeited. Mr. Yates would forfeit $0 of unvested deferred MICP premiums.
8 No post-retirement health care benefits apply under voluntary termination, for cause termination, death or disability.
Mr. Yates is not eligible for early retirement or normal retirement. Under involuntary not for cause termination, Mr. Yates
would be reimbursed for 18 months of COBRA premiums at $1,371.22 per month as provided in his employment agreement.
In the event of involuntary or good reason termination (CIC), the Management Change-in-Control Plan provides for Company-
paid medical, dental and vision coverage in the same plan Mr. Yates was participating in prior to termination for 36 months at
$1,344.33 per month.
9 Mr. Yates would be eligible to receive $500,000 proceeds from the executive AD&D policy.
10 Upon a change in control, the Management Change-in-Control Plan provides for the Company to pay all excise taxes
under IRC Section 280G plus applicable gross-up amounts for Mr. Yates. Under IRC Section 280G, Mr. Yates would be subject
to excise tax on $2,895,652 of excess parachute payments above his base amount. Those excess parachute payments result in
$579,130 of excise taxes, $953,400 of tax gross-ups, and $22,222 of employer Medicare tax related to the excise tax payment.
11 See “Management Change-in-Control Plan – Application of the CIC Plan and Other Compensation Related
Consequences of the Proposed Merger with Duke Energy” on pages 38 through 39 above for a discussion regarding
“involuntary” or “good reason” termination following the merger with Duke Energy.