UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D. C. 20549
FORM 10-Q
(Mark One)
[ X ] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended June 30, 1995
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR
15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from _____ to _____
Commission file number 1-3382
CAROLINA POWER & LIGHT COMPANY
______________________________
(Exact name of registrant as specified in its charter)
North Carolina 56-0165465
____________________________________________________________________________
(State or other jurisdiction of incorporation (I.R.S. Employer Identifica-
or organization tion No.)
411 Fayetteville Street, Raleigh, North Carolina 27601-1748
___________________________________________________________
(Address of principal executive offices)
(Zip Code)
919-546-6111
____________
(Registrant's telephone number, including area code)
____________________________________________________________________________
(Former name, former address and former fiscal year, if changed since
last report)
Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the preceding 12 months (or for such shorter period that the registrant was
required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days. Yes X . No .
APPLICABLE ONLY TO CORPORATE ISSUERS:
Indicate the number of shares outstanding of each of the issuer's classes of
common stock, as of the latest practicable date.
Common Stock (Without Par Value) shares outstanding at July 31,1995: 155,431,022
PART I. FINANCIAL INFORMATION
Item 1. Financial Statements
_______ ____________________
Reference is made to the attached Appendix containing the
Consolidated Interim Financial Statements for the periods ended June 30, 1995.
The amounts are unaudited but, in the opinion of management, reflect all
transactions necessary to fairly present the Company's financial position and
results of operations for the interim periods.
Item 2. Management's Discussion and Analysis of Financial Condition
and Results of Operations
_______ ___________________________________________________________
Results of Operations
For the Three, Six and Twelve Months Ended June 30, 1995,
As Compared With the Corresponding Periods One Year Earlier
___________________________________________________________
Operating Revenues: For the three, six and twelve months ended June
30, 1995, operating revenues increased (decreased) due to the following factors
(in millions):
Three Months Six Months Twelve Months
____________ __________ _____________
Customer Growth/Changes
In Usage Patterns $24 $54 $107
Weather (8) (24) (116)
Price (21) (49) (79)
Sales to North Carolina Eastern
Municipal Power Agency (9) (21) (38)
Sales to Other Utilities 9 18 36
___ ___ ___
Total $ (5) $ (22) $ (90)
=== === ===
The decrease in the weather component of revenue for the twelve
months ended June 30, 1995 is the result of mild weather in the current periods
as compared to more extreme weather in the prior periods. The decrease in the
price component of revenue for all periods is due primarily to the expiration of
a North Carolina rate rider. This reduction in revenue did not significantly
impact net income due to a corresponding decrease in amortization expense.
In addition, for the twelve-month period, approximately $20 million of the price
component decrease is attributable to a decrease in the fuel cost component of
revenue. Sales to North Carolina Eastern Municipal Power Agency (Power Agency)
decreased for all periods due to the greater availability of the jointly-owned
generating units. Sales to other utilities increased for the six-month and
twelve-month periods due to the greater availability of the Company's generating
units. For the three-month and six-month periods, the Company has become more
active in the bulk power market, contributing to the increase in sales to other
utilities for these periods.
Operating Expenses: Despite an increase in total generation, fuel for
generation decreased for the six months and twelve months ended June 30, 1995,
due to greater availability of the Company's nuclear generating units. During
these periods, lower-cost nuclear generation, as a percentage of total
generation, increased and higher-cost fossil generation correspondingly
decreased. For the three months ended June 30, 1995, fuel for generation
increased due to an increase in total generation.
For the six and twelve months ended June 30, 1995, deferred fuel cost
increased primarily due to lower fuel costs associated with increased nuclear
generation. For the twelve-month period, the increase due to lower fuel costs
more than offset a decrease of $33 million related to fuel settlements reached
with the Company's regulators. Pursuant to these settlements, the Company
agreed to forgo recovery of deferred fuel costs totaling approximately $8
million and $41 million for the twelve-month periods ended June 30, 1995, and
June 30, 1994, respectively.
Purchased power decreased for the six and twelve months ended June 30,
1995, due to decreased purchases from other utilities, resulting from greater
availability of the Company's generating facilities in the current periods, and
due to lower purchases from Power Agency in accordance with the Harris Plant
buyback agreement.
The decrease in maintenance expense for the twelve months ended June
30, 1995, is due to a decrease in expense associated with outages at the
Company's nuclear generating facilities.
For all periods, the decreases in depreciation and amortization are
primarily due to the completion of the amortization of abandoned plant costs for
Harris Unit No. 2 and of costs associated with the North Carolina rate rider.
The increase in income tax expense for all periods is primarily due to
a reduction of expense in the prior periods related to certain Internal Revenue
Service (IRS) audit issues. Additionally, for the twelve-month period, an
increase in income contributed to the increase in income tax expense.
Other Income (Expense): The decrease in Harris Plant carrying costs for
the twelve months ended June 30, 1995, is primarily related to the Company's
settlement with North Carolina Electric Membership Corporation in 1993.
The decrease in interest income for all periods is due to the June 1994
recording of interest income related to certain IRS audit issues. Additionally,
for the twelve months ended June 30, 1995, interest income decreased due to a
settlement recorded in 1993, which increased interest income in the prior
period.
Other income, net, decreased for the twelve months ended June 30,
1995, due to a decrease in accretion to present value associated with the
Company's abandonment costs and due to various other items, none of which is
individually significant.
The increase in the income tax credit for the twelve months ended June
30, 1995 is primarily attributable to lower income in the current period.
Material Changes in Capital Resources and Liquidity
From December 31, 1994, to June 30, 1995
and From June 30, 1994, to June 30, 1995
___________________________________________________
During the six and twelve months ended June 30, 1995, the Company
issued long-term debt of $185 million and $235 million, respectively. The
proceeds of these issuances, along with the issuance of short-term debt and
internally generated funds, financed the redemption or retirement of long-term
debt totaling $227.1 million during both the six and twelve months ended June
30, 1995.
In order to provide flexibility in the timing and amounts of long-term
financing, the Company uses short-term financing in the form of commercial
paper backed by revolving credit agreements. These revolving credit agreements
currently amount to $285 million. The Company had $82.7 million of
commercial paper outstanding at June 30, 1995.
The Company's capital structure at June 30, 1995, was 47.98% common
stock equity, 49.37% long-term debt and 2.65% preferred stock. At June 30,
1994, the Company's capital structure was 49.9% common stock equity, 47.4%
long-term debt and 2.7% preferred stock.
The Company's First Mortgage Bonds are currently rated "A2" by
Moody's Investors Service, "A" by Standard & Poors and "A+" by Duff &
Phelps. Moody's Investors Service, Standard & Poors and Duff & Phelps have
rated the Company's commercial paper "P-1", "A-1" and "D-1" respectively.
In 1994, the Board of Directors of the Company authorized the
Executive Committee of the Board to repurchase up to 10 million shares of the
Company's common stock on the open market. Under this stock repurchase
program, the Company has purchased approximately 4.6 million shares from July
1994 through June 1995. The decrease in average common shares outstanding
resulted in an increase in earnings per common share of approximately $.01, $.03
and $.05 for the three, six and twelve months ended June 30, 1995, respectively.
Other Matters
_____________
In 1994, the Company established a wholly-owned subsidiary, CaroNet,
Inc., which owns a ten percent interest in BellSouth Carolinas PCS, L.P., a
limited partnership led by BellSouth Personal Communications, Inc. (BellSouth).
In March 1995, BellSouth won its bid for a Federal Communications
Commission license to operate a personal communications services (PCS) system
covering most of North Carolina and South Carolina and a small portion of
Georgia. PCS, a wireless communications technology, is expected to provide
high-quality mobile communications. BellSouth will transfer the PCS license to
the limited partnership. BellSouth is the general partner and handles day-to-day
management of the business. In April 1995, the Company invested $50 million
in CaroNet, Inc. in anticipation of infrastructure construction. Construction
of the system infrastructure began in the spring of 1995 and service start-up
is expected to begin in mid-1996.
PART II. OTHER INFORMATION
Item 1. Legal Proceedings
_______ _________________
Legal aspects of certain matters are set forth in Item 5 below.
Item 2. Changes in Securities )
_______ _____________________ )
)
Item 3. Defaults upon Senior Securities ) Not
_______ _______________________________ ) applicable for
) the quarter ended
) June 30, 1995.
)
)
Item 4. Submission of Matters to a Vote
of Security Holders
_______ _________________________________
(a) The Annual Meeting of the Shareholders was held on
May 10, 1995.
(b) The meeting involved the election of directors. Proxies
for the meeting were solicited pursuant to Regulation 14,
there was no solicitation in opposition to the
management's nominees as listed below, and all such
nominees were elected.
(c) The Board of Directors' proposal to amend the
Company's Restated Charter and By-Laws to establish a
variable range for the size of the Company's Board of
Directors was approved by the shareholders. The number
of shares voted for the amendment was 123,301,566, the
number of shares voted against the amendment was
13,424,654 and the number of shares that abstained from
voting was 3,132,155. The Board of Directors' proposal
to amend the Company's By-Laws to provide for
Classification of the Board of Directors was approved by
the shareholders. The number of shares voted for the
amendment was 96,591,670, the number of shares voted
against the amendment was 20,511,125, the number of
shares that abstained from voting was 2,068,442, and the
number of shares represented by broker non-votes was
20,687,138.
The total votes for the election of directors were as
follows:
Votes For Votes Withheld
_________ ______________
Class I
(Term Expiring in 1996)
_______________________
Leslie M. Baker, Jr. 136,916,998 2,941,377
George H. V. Cecil 136,903,383 2,954,922
Sherwood H. Smith, Jr. 136,974,655 2,883,720
J. Tylee Wilson 136,980,130 2,878,245
Class II
(Term Expiring in 1997)
_______________________
Edwin B. Borden 137,080,180 2,778,195
Richard L. Daugherty 136,954,985 2,903,390
J. R. Bryan Jackson 137,108,169 2,750,206
Robert L. Jones 137,034,539 2,823,836
Class III
(Term Expiring in 1998)
_______________________
Felton J. Capel 136,941,665 2,916,710
William Cavanaugh III 136,921,201 2,937,174
Charles W. Coker 137,064,173 2,794,202
Estell C. Lee 137,085,472 2,772,903
(d) Not applicable.
Item 5. Other Information
_______ _________________
1. (Reference is made to the Company's 1994 Form 10-K,
Competition and Franchises, page 8, paragraph 1b.) With
regard to the petition filed with the North Carolina Utilities
Commission (NCUC) by the Carolina Utility Customers
Association, Inc. requesting that the NCUC hold a generic
hearing to address various retail wheeling issues (Docket No.
E-100, Sub 77), on July 21, 1995, the NCUC issued an order
indicating that it will not convene a formal hearing to
investigate these issues at this time. The NCUC's order noted
that North Carolina's territorial assignment statute appears to
prohibit retail wheeling, and the issue represents a number of
jurisdictional uncertainties. The NCUC concluded that for the
time being, it should monitor developments in other states and
at the Federal Energy Regulatory Commission (FERC)
regarding jurisdictional and other issues affecting retail
wheeling. Instead of convening a hearing, the NCUC
requested that interested parties suggest, by mid September
1995, specific issues for further consideration in this docket.
The NCUC also indicated that it is considering holding
informal proceedings to gather more information on
competition issues in the future. The Company cannot predict
the outcome of this matter.
2. (Reference is made to the Company's 1994 Form 10-K,
Competition and Franchises, page 8, paragraph 1c.) On
June 8, 1995, and July 5, 1995, the Company filed with the
NCUC and the South Carolina Public Service Commission
(SCPSC) respectively, an Economic Development Rider which
will permit the Company to provide a discount on the first five
years of electric service it provides to businesses that locate to
or expand within the Company's service territory if they meet
certain criteria, including threshholds for the size of new load,
the amount of investment and the number of new jobs
provided by the businesses. The Economic Development Rider
was approved by the NCUC on July 10, 1995, and by the
SCPSC on July 21, 1995.
3. (Reference is made to the Company's 1994 Form 10-K,
Competition and Franchises, page 8, paragraph 1d.) In March
1995, the Company submitted bids in response to each of
North Carolina Electric Membership Corporation's (NCEMC)
two requests for proposals to provide (for a minimum of ten
years) up to 225 MW per year of base load power to NCEMC
beginning in 2001, an additional block of up to 225 MW per
year beginning in 2002, and a third block of up to 225 MW
per year beginning in 2003. On June 30, 1995, the Company
was notified by NCEMC that one of Company's bids had been
selected for further negotiations. The Company is negotiating
with NCEMC and is developing new bids, which will include
a hybrid of the Company's two original bids. The Company
cannot predict the outcome of this matter.
4. (Reference is made to the Company's 1994 Form 10-K,
Competition and Franchises, page 8. Reference is also made
to the Company's Form 10-Q for the quarter ended March 31,
1995, Item 5, paragraph 2.) On July 29, 1995, the North
Carolina General Assembly (General Assembly) passed a bill
directing the Joint Legislative Utility Review Committee
(Utility Review Committee) to study whether or not the
extension of interstate natural gas pipelines into North Carolina
can and should be encouraged by amending the North Carolina
Public Utilities Act (Public Utilities Act) to exempt from
regulation as public utilities facilities that sell electric power
and thermal energy generated with natural gas from these
pipelines. The bill also directs the Utility Review Committee
to study whether the Public Utilities Act should be amended to
encourage the construction of new interstate pipelines in North
Carolina. The bill orders the Utility Review Committee to
report its findings and any recommendations regarding these
matters to the General Assembly in 1996. The Company
cannot predict the outcome of this matter.
5. (Reference is made to the Company's 1994 Form 10-K,
Competition and Franchises, page 8. Reference is also made
to the Company's Form 10-Q for the quarter ended March 31,
1995, Item 5, paragraph 3.) With regard to the bill introduced
in the General Assembly concerning public power agencies in
the state, a substantially amended version of the bill, which
authorizes internal reorganizational changes among the state's
municipal power agencies, and orders the Utility Review
Committee to study other issues contained in the bill as
originally introduced, was passed by the General Assembly
effective July 11, 1995. The Company cannot predict the
outcome of this matter.
6. (Reference is made to the Company's 1994 Form 10-K,
Financing Program, page 11, paragraph 4. Reference is also
made to the Company's Form 10-Q for the quarter ended
March 31, 1995, Item 5, paragraph 5.) Retirements since
March 31, 1995 consist of the following:
-- The retirement on April 1, 1995, of $77.1 million
principal amount of First Mortgage Bonds, 9.14%
Series, which matured on that date.
-- The retirement on June 8, 1995, of $25 million
principal amount of First Mortgage Bonds, 8.92%
Secured Medium-Term Notes, Series A, which
matured on that date.
-- The retirement on July 20, 1995, of $25 million
principal amount of First Mortgage Bonds, 8.86%
Secured Medium-Term Notes, Series A, which
matured on that date.
7. (Reference is made to the Company's 1994 Form 10-K, Retail
Rate Matters, page 12, paragraph 3.) The Company filed its
1995 Integrated Resource Plan (IRP) with the NCUC on
April 28, 1995, and with the SCPSC on June 30, 1995. The
NCUC has scheduled a hearing regarding the Company's 1995
IRP to begin on October 10, 1995. The Company cannot
predict the outcome of these matters.
8. (Reference is made to the Company's 1994 Form 10-K, Retail
Rate Matters, page 12, paragraph 5.) With regard to the
Company's annual North Carolina fuel case proceeding, on
June 2, 1995, the Company filed an application with the
NCUC to reduce the fuel expense portion of the Company's
rates by approximately 15% to reflect improved nuclear
performance and to refund, over a twelve-month period
beginning in September 1995, approximately $50 million in
fuel revenues, which exceeded actual costs for the test period,
and interest. The Company's North Carolina fuel case hearing
was held on August 1, 1995, but the NCUC has not yet
rendered a decision. The Company cannot predict the outcome
of this matter.
In the South Carolina retail jurisdiction, the Company's fall
1995 South Carolina fuel case is scheduled to begin on
September 13, 1995. The Company cannot predict the
outcome of this matter.
9. (Reference is made to the Company's 1994 Form 10-K, Retail
Rate Matters, page 12, paragraph 6.) With regard to the
NCUC's biennial avoided cost proceeding (Docket No. E-100,
Sub 75), on June 23, 1995, the NCUC approved, with one
minor exception, the Company's proposed lower avoided cost
rates. The Company anticipates that the revised lower rates
will result in savings to the Company, as it enters into new
purchase agreements with qualifying facilities.
10. (Reference is made to the Company's 1994 Form 10-K, Retail
Rate Matters, page 12, paragraph 7.) With regard to the
NCUC proceeding to consider whether the adoption of certain
standards would further the purposes of the Public Utility
Regulatory Policies Act, on May 16, 1995, the NCUC issued
an order stating that it has already adopted the standards
related to the use of integrated resource planning by electric
utilities and investments in conservation and demand-side
management. The order also states that the NCUC has
implemented the standards related to energy efficiency
investments in power generation and supply to the extent
permitted by state law.
11. (Reference is made to the Company's 1994 Form 10-K,
Wholesale Rate Matters, page 14.) By letter dated May 31,
1995, the Company requested that the FERC (Docket No. 95-
1139) establish a return on equity (ROE) in connection with
the formula rates provided in the Power Coordination
Agreement (PCA) dated August 27, 1993 between the
Company and NCEMC. The requested ROE is consistent with
the rate of return on common equity approved by the NCUC
in the Company's 1988 rate case. The Company cannot
predict the outcome of this matter.
12. (Reference is made to the Company's 1994 Form 10-K,
Wholesale Rate Matters, page 14.) On May 31, 1995, the
Company filed a petition with the FERC (Docket No. EL95-
50) seeking to recover certain fuel costs from the Company's
wholesale customers. These costs are related to the
Company's $6.8 million buyout of its contractual agreement
with The Arch Coal Sales Company (Arch Coal). As a result
of this buyout, the Company will purchase less coal from Arch
Coal in the future and will pay a lower purchase price for that
coal. The Company is seeking recovery of these costs from
the NCUC and the SCPSC. The Company cannot predict the
outcome of this matter.
13. (Reference is made to the Company's 1994 Form 10-K,
Wholesale Rate Matters, page 14.) On July 7, 1995,
Smithfield Foods, Inc., doing business as Carolina Foods
Processors, Inc. (Carolina Foods), filed a Complaint with the
FERC (Docket No. EL95-60) alleging that certain charges
imposed upon NCEMC under the PCA between the Company
and NCEMC are unreasonable. These charges are related to
generation installed by Carolina Foods, which receives electric
service from Four County EMC (a customer of NCEMC). The
Company filed its response to the Complaint on August 10,
1995. The Company cannot predict the outcome of this
matter.
14. (Reference is made to the Company's 1994 Form 10-K,
Environmental Matters, page 15, paragraph 3.a.) With regard
to the settlement negotiations involving the Maxey Flats
Nuclear Disposal Site in Fleming County, Kentucky, on June
5, 1995, a De Maximus Consent Decree (Consent Decree) was
filed on behalf of the Maxey Flats Steering Committee, which
includes the Company, and eleven federal agencies in the
United States District Court for the Eastern District of
Kentucky (Civil Action No. 95-58). The Consent Decree
provides for the performance of the Initial Remediation Phase
and the Balance of Remediation Phase, and for the
reimbursement of certain response costs incurred by the EPA.
The Department of Justice will receive comments relating to
the proposed Consent Decree until August 18, 1995. Although
the Company cannot predict the outcome of this matter, it does
not anticipate that costs associated with this site will be
material to the results of operations of the Company.
15. (Reference is made to the Company's 1994 Form 10-K,
Environmental Matters, page 15, paragraph 3.c.) With regard
to the remedial activities performed at the Elliot's Auto Parts
site in Benton, Arkansas, on July 12, 1995, the Company was
informed that the EPA had approved the final report regarding
the site on October 13, 1994. Now that the final report has
been approved, the settlement agreement between the Company
and the Elliot's Auto Parts Potentially Responsible Party
Committee will be implemented. Although the Company
cannot predict the outcome of this matter, it does not anticipate
that future costs associated with this site, if any, would be
material to the results of operations of the Company.
16. (Reference is made to the Company's 1994 Form 10-K,
Nuclear Matters, page 19, paragraph 3.) With regard to the
disposal of low-level radioactive waste, effective July 1, 1995,
South Carolina withdrew from the Southeast regional compact
and excluded North Carolina waste generators from the
existing disposal site in South Carolina. As a result, the State
of North Carolina does not have access to a low-level
radioactive waste disposal facility. The North Carolina Low-
Level Radioactive Waste Management Authority, which is
responsible for siting and operating a new low-level radioactive
waste disposal facility for the Southeast regional compact, has
submitted a license application for the site it selected in Wake
County, North Carolina to the North Carolina Division of
Radiation Protection. The Company's nuclear plants in North
Carolina are currently storing low-level waste on site and are
developing additional storage capacity to accommodate future
needs. The Company's nuclear plant in South Carolina has
access to the existing disposal site in South Carolina.
Although the Company cannot predict the outcome of this
matter, it does not expect the cost of providing additional on-
site storage capacity for low-level radioactive waste to be
material to the results of operations of the Company.
17. (Reference is made to the Company's 1994 Form 10-K, Other
Matters, page 27, paragraph 2. Reference is also made to the
Company's Form 10-Q for the quarter ended March 31, 1995,
Item 5, paragraph 6.) With regard to the independent safety
inspection report for the Marshall Hydroelectric Project, by
letter dated June 15, 1995, the FERC requested that the
Company perform further analyses and submit its findings to
the FERC by no later than August 14, 1995. The Company
cannot predict the outcome of this matter.
18. (Reference is made to the Company's 1994 Form 10-K, Other
Matters, page 27, paragraph 4.) With regard to the tax refund
dispute (Civil Action No. 5:94-CV-313-BR3) in which the
Company is seeking a refund of certain tax and interest related
to the Harris Plant depreciation deductions that were previously
disallowed by the Internal Revenue Service, it is anticipated
that a trial in this matter will begin in late 1995 or early 1996.
Item 6. Exhibits and Reports on Form 8-K
_______ ________________________________
(a) Exhibits
3(i) Restated Charter of Carolina Power & Light Company
as amended on May 10, 1995.
3(ii) By-Laws of Carolina Power & Light Company as
amended on May 10, 1995.
(b) Reports on Form 8-K filed during or with respect to the
quarter:
Date of Report
(Earliest Event Reported) Date of Signature Items Reported
_________________________ _________________ ______________
April 13, 1995 April 13, 1995 Item 7. Financial
Statements, Pro Forma
Financial Information
and Exhibits
April 20, 1995 April 20, 1995 Item 7. Financial
Statements, Pro Forma
Financial Information
and Exhibits
SIGNATURES
Pursuant to requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
CAROLINA POWER & LIGHT COMPANY
(Registrant)
By /s/ Glenn E. Harder
Executive Vice President
By /s/ Paul S. Bradshaw
Vice President and Controller
(and Principal Accounting Officer)
Date: August 10, 1995
<TABLE>
<CAPTION>
Carolina Power & Light Company
(ORGANIZED UNDER THE LAWS OF NORTH CAROLINA)
CONSOLIDATED INTERIM FINANCIAL STATEMENTS
(NOT AUDITED BY INDEPENDENT AUDITORS)
JUNE 30, 1995
<S> <C> <C> <C> <C> <C> <C>
STATEMENTS OF INCOME
Three Months Ended Six Months Ended Twelve Months Ended
(In thousands June 30 June 30 June 30
except per share amounts) 1995 1994 1995 1994 1995 1994
--------------------------------------------------------------------------------------------------------------------------------
Operating Revenues $ 681,965 $ 687,310 $ 1,410,203 $ 1,431,771 $ 2,855,021 $ 2,945,077
--------------------------------------------------------------------------------------------------------------------------------
Operating Expenses
Operation - fuel for generation 127,322 121,505 238,118 251,417 458,668 526,954
deferred fuel cost (credit), net (6,675) (5,964) 15,800 (8,215) 62,185 22,324
purchased power 105,137 105,814 198,796 217,355 395,741 425,372
other 139,106 139,266 266,184 270,070 536,073 528,021
Maintenance 57,353 63,777 98,108 110,736 194,105 217,628
Depreciation and amortization 90,896 109,145 181,171 214,202 364,703 420,716
Taxes other than on income 35,280 36,831 74,200 72,267 140,473 147,765
Income tax expense 32,942 23,812 94,358 81,310 211,583 183,243
Harris Plant deferred costs, net 7,178 6,694 13,783 13,172 26,940 30,457
--------------------------------------------------------------------------------------------------------------------------------
Total Operating Expenses 588,539 600,880 1,180,518 1,222,314 2,390,471 2,502,480
--------------------------------------------------------------------------------------------------------------------------------
Operating Income 93,426 86,430 229,685 209,457 464,550 442,597
--------------------------------------------------------------------------------------------------------------------------------
Other Income (Expense)
Allowance for equity funds used during construction 984 1,838 1,897 4,101 3,870 9,190
Income tax credit (expense) 3,207 (1,094) 6,497 2,489 13,432 2,965
Harris Plant carrying costs 2,128 2,482 4,347 5,045 9,055 27,063
Harris Plant disallowance - Power Agency - - - - - (20,645)
Interest income 2,781 10,108 5,369 11,402 8,536 34,939
Other income, net 4,250 7,525 8,271 14,015 19,846 35,587
--------------------------------------------------------------------------------------------------------------------------------
Total Other Income 13,350 20,859 26,381 37,052 54,739 89,099
--------------------------------------------------------------------------------------------------------------------------------
Income Before Interest Charges 106,776 107,289 256,066 246,509 519,289 531,696
--------------------------------------------------------------------------------------------------------------------------------
Interest Charges
Long-term debt 47,248 46,589 93,841 93,965 183,767 192,428
Other interest charges 5,011 3,486 11,039 7,737 19,420 15,376
Allowance for borrowed funds used
during construction (1,445) (1,001) (2,809) (2,232) (4,021) (5,661)
--------------------------------------------------------------------------------------------------------------------------------
Net Interest Charges 50,814 49,074 102,071 99,470 199,166 202,143
--------------------------------------------------------------------------------------------------------------------------------
Net Income 55,962 58,215 153,995 147,039 320,123 329,553
Preferred Stock Dividend Requirements (2,402) (2,402) (4,804) (4,804) (9,609) (9,609)
--------------------------------------------------------------------------------------------------------------------------------
Earnings for Common Stock $ 53,560 $ 55,813 $ 149,191 $ 142,235 $ 310,514 $ 319,944
================================================================================================================================
Average Common Shares
Outstanding (Note 3) 147,183 151,057 147,226 150,939 147,772 155,878
Earnings per Common Share (Note 3) $ 0.36 $ 0.37 $ 1.01 $ 0.94 $ 2.10 $ 2.05
Dividends Declared per Common Share $ 0.440 $ 0.425 $ 0.880 $ 0.850 $ 1.745 $ 1.685
................................................................................................................................
See Supplemental Data and Notes to Financial Statements.
</TABLE>
<TABLE>
<CAPTION>
Carolina Power & Light Company
BALANCE SHEETS June 30 December 31
(In thousands) 1995 1994 1994
------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
ASSETS
Electric Utility Plant
Electric utility plant in service $ 9,295,945 $ 8,960,319 $ 9,190,874
Accumulated depreciation (3,337,249) (3,054,933) (3,196,139)
------------------------------------------------------------------------------------------------------
Electric utility plant in service, net 5,958,696 5,905,386 5,994,735
Held for future use 13,303 13,222 13,195
Construction work in progress 188,610 244,124 170,390
Nuclear fuel, net of amortization 181,774 199,281 171,164
------------------------------------------------------------------------------------------------------
Total Electric Utility Plant, Net 6,342,383 6,362,013 6,349,484
------------------------------------------------------------------------------------------------------
Current Assets
Cash and cash equivalents 16,600 19,254 80,239
Accounts receivable 308,941 332,829 302,218
Fuel 97,264 81,735 96,136
Materials and supplies 126,191 118,891 122,720
Prepayments 64,935 44,589 52,988
Other current assets 29,607 15,160 24,129
------------------------------------------------------------------------------------------------------
Total Current Assets 643,538 612,458 678,430
------------------------------------------------------------------------------------------------------
Deferred Debits and Other Assets
Income taxes recoverable
through future rates 385,960 381,856 384,375
Abandonment costs 63,880 85,278 71,079
Harris Plant deferred costs 118,388 136,272 127,824
Unamortized debt expense 60,875 65,726 63,302
Miscellaneous other property and investments 428,556 314,163 360,611
Other assets and deferred debits 175,136 190,801 176,058
------------------------------------------------------------------------------------------------------
Total Deferred Debits and Other Assets 1,232,795 1,174,096 1,183,249
------------------------------------------------------------------------------------------------------
Total Assets $ 8,218,716 $ 8,148,567 $ 8,211,163
======================================================================================================
CAPITALIZATION AND LIABILITIES
Capitalization
Common stock equity $ 2,607,920 $ 2,659,859 $ 2,586,179
Preferred stock - redemption not required 143,801 143,801 143,801
Long-term debt, net 2,683,514 2,527,025 2,530,773
------------------------------------------------------------------------------------------------------
Total Capitalization 5,435,235 5,330,685 5,260,753
------------------------------------------------------------------------------------------------------
Current Liabilities
Current portion of long-term debt 78,000 227,050 275,050
Notes payable (principally commercial paper) 82,700 72,600 68,100
Accounts payable 187,318 181,116 285,610
Taxes accrued 87,142 77,681 4,650
Interest accrued 50,265 55,070 54,569
Dividends declared 69,925 70,095 70,658
Deferred fuel credit (cost) 44,144 (18,042) 28,344
Other current liabilities 62,508 75,888 67,161
------------------------------------------------------------------------------------------------------
Total Current Liabilities 662,002 741,458 854,142
------------------------------------------------------------------------------------------------------
Deferred Credits and Other Liabilities
Accumulated deferred income taxes 1,630,742 1,580,845 1,628,430
Accumulated deferred investment tax credits 246,945 257,819 252,051
Other liabilities and deferred credits 243,792 237,760 215,787
------------------------------------------------------------------------------------------------------
Total Deferred Credits and Other Liabilities 2,121,479 2,076,424 2,096,268
------------------------------------------------------------------------------------------------------
Commitments and Contingencies (Note 4)
Total Capitalization and Liabilities $ 8,218,716 $ 8,148,567 $ 8,211,163
======================================================================================================
SCHEDULES OF COMMON STOCK EQUITY
(In thousands)
Common stock (Note 3) $ 1,505,093 $ 1,624,696 $ 1,510,956
Unearned ESOP common stock (197,010) (211,285) (204,947)
Capital stock issuance expense (790) (790) (790)
Retained earnings 1,300,627 1,247,238 1,280,960
------------------------------------------------------------------------------------------------------
Total Common Stock Equity $ 2,607,920 $ 2,659,859 $ 2,586,179
======================================================================================================
......................................................................................................
See Supplemental Data and Notes to Financial Statements.
</TABLE>
<TABLE>
<CAPTION>
Carolina Power & Light Company
STATEMENTS OF CASH FLOWS
(In thousands) Three Months Ended Six Months Ended Twelve Months Ended
June 30 June 30 June 30
1995 1994 1995 1994 1995 1994
-----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Operating Activities
Net income $ 55,962 $ 58,215 $ 153,995 $ 147,039 $ 320,123 $ 329,553
Adjustments to reconcile net income to net cash
provided by operating activities
Depreciation and amortization 107,687 124,160 222,748 243,627 452,602 474,534
Harris Plant deferred costs 5,050 4,212 9,436 8,127 17,885 3,394
Harris Plant disallowance - Power Agency - - - - - 20,645
Deferred income taxes 4,068 9,628 (7,512) 807 28,922 58,181
Investment tax credit adjustments (2,553) (2,884) (5,106) (5,768) (10,877) (12,788)
Allowance for equity funds used during construction (984) (1,838) (1,897) (4,101) (3,870) (9,190)
Deferred fuel cost (credit) (6,675) (5,964) 15,800 (8,215) 62,185 22,324
Net increase in receivables, inventories and
prepaid expenses (35,573) (46,231) (78,965) (69,314) (83,542) (7,625)
Net increase (decrease) in payables and accrued
expenses 9,573 (33,956) (6,803) (26,799) (26,775) (53,269)
Miscellaneous 15,248 (4,177) 27,228 15,444 6,852 (12,212)
-----------------------------------------------------------------------------------------------------------------------------------
Net Cash Provided by Operating Activities 151,803 101,165 328,924 300,847 763,505 813,547
-----------------------------------------------------------------------------------------------------------------------------------
Investing Activities
Gross property additions (66,804) (55,628) (138,732) (127,941) (285,567) (325,596)
Nuclear fuel additions (19,442) (1,212) (35,310) (12,428) (48,732) (34,486)
Contributions to external decommissioning trust (8,052) (7,387) (26,616) (13,715) (34,526) (27,287)
Contributions to retiree benefit trusts - - (2,400) (18,917) (2,400) (21,417)
Loan transactions with SPSP Trustee, net - - - - - 16,009
Allowance for equity funds used during construction 984 1,838 1,897 4,101 3,870 9,190
Miscellaneous (16,035) - (16,522) - (22,617) -
-----------------------------------------------------------------------------------------------------------------------------------
Net Cash Used in Investing Activities (109,349) (62,389) (217,683) (168,900) (389,972) (383,587)
-----------------------------------------------------------------------------------------------------------------------------------
Financing Activities
Proceeds from issuance of long-term debt 120,939 120,339 180,670 268,325 230,556 555,104
Net increase (decrease) in short-term notes
payable (maturity less than 90 days) (12,800) 65,900 14,600 (3,400) 10,100 41,700
Retirement of long-term debt (102,050) (172,616) (227,095) (268,239) (227,236) (771,555)
Purchase of Company common stock (Note 3) (3,815) - (7,993) - (122,710) -
Dividends paid on common stock (65,583) (64,186) (130,239) (128,172) (257,274) (259,117)
Dividends paid on preferred stock (2,403) (2,403) (4,823) (4,814) (9,623) (9,484)
-----------------------------------------------------------------------------------------------------------------------------------
Net Cash Used in Financing Activities (65,712) (52,966) (174,880) (136,300) (376,187) (443,352)
-----------------------------------------------------------------------------------------------------------------------------------
Net Decrease in Cash and Cash Equivalents (23,258) (14,190) (63,639) (4,353) (2,654) (13,392)
Cash and Cash Equivalents at Beginning of the Period 39,858 33,444 80,239 23,607 19,254 32,646
-----------------------------------------------------------------------------------------------------------------------------------
Cash and Cash Equivalents at End of the Period $ 16,600 $ 19,254 $ 16,600 $ 19,254 $ 16,600 $ 19,254
===================================================================================================================================
Supplemental Disclosures of Cash Flow Information
Cash paid during the period - interest $ 48,761 $ 43,383 $ 103,455 $ 95,630 $ 196,578 $ 203,789
income taxes $ 39,000 $ 50,675 $ 40,611 $ 52,725 $ 168,645 $ 135,996
...................................................................................................................................
See Supplemental Data and Notes to Financial Statements.
</TABLE>
<TABLE>
<CAPTION>
Carolina Power & Light Company
SUPPLEMENTAL DATA Three Months Ended Six Months Ended Twelve Months Ended
June 30 June 30 June 30
1995 1994 1995 1994 1995 1994
---------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Operating Revenues (in thousands)
Residential $ 193,263 $ 190,017 $ 444,618 $ 452,390 $ 908,214 $ 956,060
Commercial 149,714 149,520 290,856 293,317 593,112 603,469
Industrial 187,742 192,686 352,158 359,546 734,274 744,591
Government and municipal 18,723 19,582 37,565 39,098 76,784 79,354
Wholesale - standard rate schedules 20,125 25,137 40,525 48,991 76,309 101,146
Power Agency contract requirements 22,590 31,818 46,408 67,765 93,905 131,759
NCEMC 58,657 56,328 142,364 133,672 275,425 267,247
Other utilities 20,128 11,571 33,669 15,641 51,817 22,350
Miscellaneous revenue 11,023 10,651 22,040 21,351 45,181 39,101
---------------------------------------------------------------------------------------------------------------------------
Total Operating Revenues $ 681,965 $ 687,310 $ 1,410,203 $ 1,431,771 $ 2,855,021 $ 2,945,077
===========================================================================================================================
Energy Sales (millions of kWh)
Residential 2,419 2,303 5,682 5,646 11,184 11,549
Commercial 2,247 2,167 4,338 4,218 8,811 8,703
Industrial 3,733 3,676 7,000 6,793 14,237 13,919
Government and municipal 299 304 600 610 1,252 1,260
Wholesale - standard rate schedules 473 574 935 1,052 1,866 2,132
Power Agency contract requirements 489 804 965 1,451 2,103 3,099
NCEMC 1,100 1,053 2,484 2,275 5,093 4,944
Other utilities 902 216 1,476 334 2,126 507
---------------------------------------------------------------------------------------------------------------------------
Total Energy Sales 11,662 11,097 23,480 22,379 46,672 46,113
===========================================================================================================================
Energy Supply (millions of kWh)
Generated - coal 5,877 5,753 10,440 11,849 19,591 25,330
nuclear 4,044 3,668 9,891 7,051 21,352 13,995
hydro 155 232 453 537 800 734
combustion turbines 1 28 - 66 1 119
Purchased 2,034 1,859 3,544 3,816 6,767 7,879
---------------------------------------------------------------------------------------------------------------------------
Total Energy Supply
(Company Share) 12,111 11,540 24,328 23,319 48,511 48,057
===========================================================================================================================
Detail of Income Taxes (in thousands)
Included in Operating Expenses
Income tax expense - current $ 33,016 $ 18,837 $ 110,171 $ 89,080 $ 203,736 $ 144,618
Income tax expense - deferred 2,479 7,859 (10,708) (2,002) 18,721 50,219
Income tax expense - investment
tax credit adjustments (2,553) (2,884) (5,105) (5,768) (10,874) (11,594)
---------------------------------------------------------------------------------------------------------------------------
Subtotal 32,942 23,812 94,358 81,310 211,583 183,243
---------------------------------------------------------------------------------------------------------------------------
Harris Plant deferred costs -
investment tax credit adjustments (74) (74) (149) (149) (297) 158
---------------------------------------------------------------------------------------------------------------------------
Total Included in Operating Expenses 32,868 23,738 94,209 81,161 211,286 183,401
---------------------------------------------------------------------------------------------------------------------------
Included in Other Income
Income tax expense (credit) - current (4,796) (675) (9,693) (5,298) (23,633) (9,733)
Income tax expense - deferred 1,589 1,769 3,196 2,809 10,201 7,962
Income tax expense - investment
tax credit adjustments - - - - - (1,194)
---------------------------------------------------------------------------------------------------------------------------
Total Included in Other Income (3,207) 1,094 (6,497) (2,489) (13,432) (2,965)
---------------------------------------------------------------------------------------------------------------------------
Total Income Tax Expense $ 29,661 $ 24,832 $ 87,712 $ 78,672 $ 197,854 $ 180,436
===========================================================================================================================
FINANCIAL STATISTICS
Ratio of earnings to fixed charges 3.35 3.26
Return on average common stock equity 11.93 % 12.22 %
Book value per common share $ 17.72 $ 17.60
Capitalization ratios
Common stock equity 47.98 % 49.90 %
Preferred stock - redemption not required 2.65 2.70
Long-term debt, net 49.37 47.40
---------------------------------------------------------------------------------------------------------------------------
Total 100.00 % 100.00 %
===========================================================================================================================
...........................................................................................................................
See Notes to Financial Statements.
</TABLE>
Carolina Power & Light Company
NOTES TO FINANCIAL STATEMENTS
1. These interim financial statements are prepared in conformity with the
accounting principles reflected in the financial statements included in
the Company's 1994 Annual Report to Shareholders and the 1994 Annual
Report on Form 10-K. These are interim financial statements, and
because of temperature variations between seasons of the year and the
timing of outages of electric generating units, especially
nuclear-fueled units, the amounts reported in the Statements of Income
for periods of less than twelve months are not necessarily indicative of
amounts expected for the year. Certain amounts for 1994 have been
reclassified to conform to the 1995 presentation.
2. In 1994, the Company established a wholly-owned subsidiary, CaroNet,
Inc., which owns a ten percent interest in BellSouth Carolinas PCS, a
limited partnership, led by BellSouth Personal Communications, Inc.
(BellSouth). In March 1995, BellSouth won its bid for a Federal
Communications Commission license for the limited partnership to operate
a personal communications services (PCS) system covering most of North
Carolina and South Carolina, as well as a small portion of Georgia. PCS,
a wireless communications technology, is expected to provide
high-quality mobile communications. BellSouth will transfer the PCS
license to the limited partnership. BellSouth is the general partner
and handles day-to-day management of the business. In April 1995, the
Company invested $50 million in CaroNet, Inc. in anticipation of
infrastructure construction. Construction of the system infrastructure
began in the spring of 1995 and service start-up is expected by
mid-1996.
3. In 1994, the Board of Directors of the Company authorized the Executive
Committee of the Board to repurchase up to 10 million shares of the
Company's common stock on the open market. In accordance with the stock
repurchase program, the Company has purchased approximately 4.6 million
shares through June 30,1995. The decrease in average common shares
outstanding resulted in an increase in earnings per common share of
approximately $.01, $.03 and $.05 for the three, six and twelve month
periods ended June 30, 1995, respectively.
4. Contingencies existing as of the date of these statements are described
below. No significant changes have occurred since December 31, 1994,
with respect to the commitments discussed in Note 10 of the financial
statements included in the Company's 1994 Annual Report to Shareholders.
a) In the Company's retail jurisdictions, provisions for nuclear
decommissioning costs are approved by the North Carolina Utilities
Commission and the South Carolina Public Service Commission and are
based on site-specific estimates that included the costs for removal of
all radioactive and other structures at the site. In the wholesale
jurisdiction, the provisions for nuclear decommissioning costs are based
on amounts agreed upon in applicable rate settlements. Based on the
site-specific estimates discussed below, and using an assumed after-tax
earnings rate of 8.5% and an assumed cost escalation rate of 4%, current
levels of rate recovery for nuclear decommissioning costs are adequate
to provide for decommissioning of the Company's nuclear facilities.
The Company's most recent site-specific estimates of
decommissioningcosts were developed in 1993, using 1993 cost factors,
and are based on prompt dismantlement decommissioning, which reflects
the cost of removal of all radioactive and other structures currently at
the site, with such removal occurring shortly after operating license
expiration. These estimates, in 1993 dollars, are $257.7 million for
Robinson Unit No. 2, $235.4 million for Brunswick Unit No. 1, $221.4
million for Brunswick Unit No. 2 and $284.3 million for the Harris
Plant. These estimates are subject to change based on a variety of
factors including, but not limited to, cost escalation, changes in
technology applicable to nuclear decommissioning, and changes in
federal, state orlocal regulations. The cost estimates exclude the
portion attributable to North Carolina Eastern Municipal Power Agency,
which holds an undivided ownership interest in certain of the Company's
generating facilities. Operating licenses for the Company's nuclear
units expire in the year 2010 for Robinson Unit No. 2, 2016 for
Brunswick Unit No. 1, 2014 for Brunswick Unit No. 2 and 2026 for the
Harris Plant.
The Financial Accounting Standards Board has added a project to its
agenda regarding the electric industry's current accounting practices
related to decommissioning costs. Any changes to these practices could
affect such items as: 1) when the decommissioning obligation is
recognized, 2) where balances of accumulated decommissioning costs are
recorded, 3) where income earned on external decommissioning trust
balances is recorded, and 4) the levels of annual decommissioning cost
provisions. It is uncertain what impact, if any, this project may have
on the Company's accounting for decommissioning costs.
b) As required under the Nuclear Waste Policy Act of 1982, the Company
entered into a contract with the U. S. Department of Energy (DOE) under
which the DOE agreed to dispose of the Company's spent nuclear fuel.
The Company cannot predict whether the DOE will be able to perform its
contractual obligations and provide interim storage or permanent
disposal repositories for spent nuclear fuel and/or high-level
radioactive waste materials on a timely basis.
With certain modifications, the Company's spent fuel storage facilities
are sufficient to provide storage space for spent fuel generated on the
Company's system through the expiration of the current operating
licenses for all of the Company's nuclear generating units. Subsequent
to the expiration of the licenses, dry storage may be necessary.
c) The Company is subject to federal, state and local regulations
addressing air and water quality, hazardous and solid waste management
and other environmental matters.
Various organic materials associated with the production of manufactured
gas, generally referred to as coal tar, are regulated under various
federal and state laws, and a liability may exist for their remediation.
There are several manufactured gas plant (MGP) sites to which the
Company and certain entities that were later merged into the Company may
have had some connection. In this regard, the Company, along with other
entities alleged to be former owners and operators of MGP sites in North
Carolina, is participating in a cooperative effort with the North
Carolina Department of Environment, Health and Natural Resources,
Division of Solid Waste Management (DSWM) to establish a uniform
framework for addressing those sites. It is anticipated that the
investigation and remediation of specific MGP sites will be addressed
pursuant to one or more Administrative Orders on Consent between DSWM
and individual potentially responsible parties. To date, the Company
has not entered into any such orders.
The Company has been approached by another North Carolina public utility
concerning a possible cost-sharing arrangement with respect to the
investigation and, if necessary, remediation of four MGP sites. The
Company is currently engaged in discussions with the other utility
regarding this matter.
In addition, a current owner of property that was the site of one MGP
owned by Tide Water Power Company (Tide Water Power), which merged into
the Company in 1952, and the Company have entered into an agreement to
share the cost of the investigation and, if necessary, the remediation
of this site. The Company has also been approached by a North Carolina
municipality that is the current owner of another MGP site that was
formerly owned by Tide Water Power. The Company is engaged in
discussions with that municipality concerning a possible cost-sharing
arrangement with respect to the investigation and, if necessary, the
remediation of that site.
The Company is continuing its investigation regarding the identities of
parties connected to several additional MGP sites, the relative
relationships of the Company and other parties to those sites and the
degree, if any, to which the Company should undertake shared voluntary
efforts with others at individual sites.
The Company has been notified by regulators of its involvement or
potential involvement in several sites, other than MGP sites, that
require remedial action. Although the Company cannot predict the
outcome of these matters, it does not anticipate significant costs
associated with these sites.
The Company has accrued a liability for the estimated costs associated
with investigation and remediation activities for certain MGP sites and
for sites other than MGP sites. This accrual was not material to the
results of operations of the Company. Due to the lack of information
with respect to the operation of MGP sites for which a liability has not
been accrued and due to the uncertainty concerning questions of
liability and potential environmental harm, the extent and cost of
required remedial action, if any, are not currently determinable. The
Company cannot predict the outcome of these matters or the extent to
which other MGP sites may become the subject of inquiry.
<TABLE> <S> <C>
<ARTICLE> UT
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED
FROM (INTERIM FINANCIAL STATEMENTS AS OF JUNE 30, 1995) AND
IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL
STATEMENTS.
</LEGEND>
<CIK> 0000017797
<NAME> CAROLINA POWER & LIGHT COMPANY
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> DEC-31-1995
<PERIOD-END> JUN-30-1995
<BOOK-VALUE> PER-BOOK
<TOTAL-NET-UTILITY-PLANT> $6,342,383
<OTHER-PROPERTY-AND-INVEST> $428,556
<TOTAL-CURRENT-ASSETS> $643,538
<TOTAL-DEFERRED-CHARGES> $629,103
<OTHER-ASSETS> $175,136
<TOTAL-ASSETS> $8,218,716
<COMMON> $1,308,083
<CAPITAL-SURPLUS-PAID-IN> ($790)
<RETAINED-EARNINGS> $1,300,627
<TOTAL-COMMON-STOCKHOLDERS-EQ> $2,607,920
$0
$143,801
<LONG-TERM-DEBT-NET> $2,683,514
<SHORT-TERM-NOTES> $0
<LONG-TERM-NOTES-PAYABLE> $0
<COMMERCIAL-PAPER-OBLIGATIONS> $82,700
<LONG-TERM-DEBT-CURRENT-PORT> $78,000
$0
<CAPITAL-LEASE-OBLIGATIONS> $0
<LEASES-CURRENT> $0
<OTHER-ITEMS-CAPITAL-AND-LIAB> $2,622,781
<TOT-CAPITALIZATION-AND-LIAB> $8,218,716
<GROSS-OPERATING-REVENUE> $1,410,203
<INCOME-TAX-EXPENSE> $94,358
<OTHER-OPERATING-EXPENSES> $1,086,160
<TOTAL-OPERATING-EXPENSES> $1,180,518
<OPERATING-INCOME-LOSS> $229,685
<OTHER-INCOME-NET> $26,381
<INCOME-BEFORE-INTEREST-EXPEN> $256,066
<TOTAL-INTEREST-EXPENSE> $102,071
<NET-INCOME> $153,995
$4,804
<EARNINGS-AVAILABLE-FOR-COMM> $149,191
<COMMON-STOCK-DIVIDENDS> $129,524
<TOTAL-INTEREST-ON-BONDS> $93,841
<CASH-FLOW-OPERATIONS> $328,924
<EPS-PRIMARY> $1.01
<EPS-DILUTED> $1.01
</TABLE>
EXHIBIT 3(i)
RESTATED CHARTER
OF
CAROLINA POWER & LIGHT COMPANY
The undersigned corporation, pursuant to action by its shareholders,
hereby executes this Restated Charter for the purpose of integrating into one
document its Articles of Incorporation, entitled Agreement of Merger of
Tidewater Power Company with and into Carolina Power & Light Company and all
amendments thereto:
FIRST: The name of the corporation is Carolina Power & Light Company
("Company").
SECOND: The location of the principal office of the Company in the
State of North Carolina shall be at Raleigh.
THIRD: The object or objects for which the Company is to exist are the
following, to wit:
The object or objects of the Company and in aid thereof and in
addition thereto the following object or objects the enumeration of
which shall not limit or restrict or be held to limit or restrict in any
manner the object or objects of the Company, namely:
To acquire, buy, hold, own, sell, lease, exchange, dispose of,
finance, deal in, construct, build, equip, improve, use, operate,
maintain and work upon:
(a) Any and all kinds of plants and systems for the manufacture,
storage, utilization, supply, transmission, distribution, or disposition
of electricity, gas, water or steam, or power produced thereby, or of
ice and refrigeration, of any and every kind, or telegraphs or
telephones, or for the transmission of information, or any thereof;
(b) Any and all kinds of street railways (except railroads) and
bus lines for the transportation of passengers and/or freight,
transmission lines, systems, appliances, equipment and devices and
tracks, stations, buildings and other structures and facilities;
(c) Any and all kinds of works, power plants, substations,
systems, tracts, machinery, generators, motors, lamps, poles, pipes,
wires, cables, conduits, apparatus, devices, supplies and articles of
every kind pertaining to or in anywise connected with the construction,
operation or maintenance of street railways (except railroads) and bus
lines or in anywise connected with the manufacture, purchase, use,
transmission, distribution, regulation, control or application of
electricity, gas, light, heat, refrigeration, ice, water, power,
telephones and telegraphs, or any other purposes;
To acquire, buy, hold, own, sell, lease, exchange, dispose of,
distribute, deal in, use, produce, furnish and supply electricity, gas, light,
heat, refrigeration, ice, water and power and any other power or force in any
form and for any purpose whatsoever;
To carry on the business of general brokers and dealers in stocks,
bonds, securities, mortgages and other choses in action, including the
acquisition thereof by original subscription; to make investments in such
property and to hold, manage, mortgage, pledge, sell, and dispose of the same
in like manner as individuals may do;
To carry on in States and jurisdictions when and where permissible
by the laws of such States and jurisdictions, the business of constructing and
operating or aiding in the construction and operation of street railways,
telegraph and telephone companies, gas and electric companies.
To acquire, organize, assemble, develop, build up and operate,
constructing and operating and other organizations and systems and to hire,
sell, lease, exchange, turn over, deliver and dispose of such organizations
and systems in whole or in part, and as going organizations and systems and
otherwise, and to enter into and perform contracts, agreements and
undertakings of any kind in connection with any or all of the foregoing
purposes;
To do a general contracting business;
To purchase, acquire, hold, own, develop and dispose of lands,
interests in and rights with respect to lands and waters and fixed and movable
property, franchises, concessions, consents, privileges and licenses in its
opinion useful or desirable for or in connection with the foregoing purposes;
To underwrite, acquire by purchase, subscription or otherwise, and
to own, hold for investment or otherwise, and to use, sell, assign, transfer,
mortgage, pledge, exchange or otherwise dispose of real and personal property
of every sort and description and wheresoever situated, including shares of
stock, bonds, debentures, notes, scrip, warrants, securities, evidences of
indebtedness, contracts or obligations of any corporation or corporations,
association or associations, domestic or foreign, or of any firm or individual
of the United States or any state, territory or dependency of the United
States or any foreign country, or any municipality or local authority within
or without the United States, and also to issue in exchange therefor stocks,
bonds or other securities or evidences of indebtedness of the Company, and
while the owner or holder of any such property, to receive, collect and
dispose of the interest, dividends and income on or from such property and to
possess and exercise in respect thereto all of the rights, powers and
privileges of ownership, including all voting powers thereon;
To aid in any manner any corporation or association, domestic or
foreign, or any firm or individual, any shares of stock in which or any bonds,
debentures, notes, securities, evidences of indebtedness, contracts, or
obligations of which are held by or for the Company, directly or indirectly,
or in which, or in the welfare of which, the Company shall have any interest,
and to do any acts designed to protect, preserve, improve or enhance the value
of any property at any time held or controlled by the Company or in which it
may be at any time interested, directly or indirectly or through other
corporations or otherwise; and to organize or promote or facilitate the
organization of subsidiary companies.
IN FURTHERANCE AND NOT IN LIMITATION of the general powers
conferred by the laws of the State of North Carolina and of the objects and
purposes hereinbefore stated, it is hereby expressly provided that the Company
shall also have the following powers, that is to say:
To do any or all things set forth to the same extent and as
fully as natural persons might or could do, and in any part of the
world, and as principal, agent, contractor or otherwise, and either
alone or in conjunction with any other persons, firms, associations or
corporations;
To borrow money, to issue bonds, promissory notes, bills of
exchange, debentures and other obligations and evidences of
indebtedness, whether secured by mortgage, pledge or otherwise, or
unsecured, for money borrowed or in payment for property purchased or
acquired or for any other lawful object; to mortgage or pledge all or
any part of its properties, rights, interests and franchises, including
any or all shares of stock, bonds, debentures, notes, scrip, warrants or
other obligation or evidences of indebtedness at any time owned by it;
To guarantee the payment of dividends upon any capital stock
and to endorse or otherwise guarantee the principal or interest, or
both, of any bonds, debentures, notes, scrip or other obligations or
evidences of indebtedness, or the performance of any contract or
obligation, of any other corporation or association, domestic or
foreign, or of any firm or individual in which the Company may have a
lawful interest, in so far and to the extent that such guaranty may be
permitted by law;
To purchase or otherwise acquire its own shares of stock (so
far as may be permitted by law), and its bonds, debentures, notes,
scrip, warrants or other securities or evidences of indebtedness, and to
cancel or to hold, sell, transfer or reissue the same;
To do all and everything necessary or convenient for the
accomplishment of the objects herein enumerated, and in general to carry
on any lawful business, incidental, necessary or convenient to any of
said objects but nothing herein contained is to be construed as
authorizing the Company to carry on the business of railroads other than
street railways, of banking or insurance or of building and loan
associations.
Nothing herein shall be deemed to limit or exclude any
power, right or privilege given to the Company by law or construed to
give the Company any rights, powers or privileges not permitted by the
laws of the State of North Carolina to corporations organized under the
statutes of the State of North Carolina for the general purposes for
which the Company is organized.
The foregoing clauses shall be construed as objects,
purposes and powers and it is hereby expressly provided that the
foregoing specific enumeration shall not be held to limit or restrict in
any manner the powers of the Company.
FOURTH: The total number of the authorized shares of the Company is
135,300,000 shares divided into 300,000 shares of $5 Preferred Stock
(hereinafter called "$5 Preferred Stock"), 20,000,000 shares of Serial
Preferred Stock (hereinafter called "Serial Preferred Stock"), 5,000,000
shares of Preferred Stock A (hereinafter called "Preferred Stock A"),
10,000,000 shares of Preference Stock, (hereinafter called "Preference
Stock"), and 100,000,000 shares of Common Stock, all without nominal or par
value.
The preferences, limitations and relative rights of each said classes of
stock shall be as follows:
PREFERRED STOCKS AND COMMON STOCK
(1)(a) The Board of Directors is authorized to establish and issue at
any time and from time to time (i) one or more series of Serial Preferred
Stock which shall be of equal rank and identical in all respects except that
there may be variations between series in the following relative rights and
preferences: Dividend rates, redemption prices and the terms and conditions
on which shares may be redeemed, sinking fund provisions for the redemption or
purchase of shares, amounts payable upon voluntary or involuntary liquidation,
and terms and conditions on which shares may converted, if shares are issued
with the privilege of conversion, and bearing such series' designations, all
as may be fixed by the Board of Directors and stated or expressed in the
resolution or resolutions establishing the respective series of such stock,
the authority for which is hereby expressly vested in the Board of Directors,
and (ii) one or more series of Preferred Stock A which shall be of equal rank
and identical in all respects except that there may be variations between
series in the following relative rights and preferences: dividend rates,
redemption prices and the terms and conditions on which shares may be
redeemed, sinking fund provisions for the redemption or purchase of shares,
the amounts payable upon voluntary or involuntary liquidation, and terms and
conditions on which shares may be converted, if shares are issued with the
privilege of conversion, and bearing such series' designations, all as may be
fixed by the Board of Directors and stated or expressed in the resolution or
resolutions establishing the respective series of stock, the authority for
which is hereby expressly vested in the Board of Directors. So long as shares
of any series of Preferred Stock A shall be outstanding, no amendment or
modification of the terms thereof fixed by the resolution or resolutions of
the Board of Directors establishing any such series shall be made unless the
holders of record of not less than a majority of the number of shares of such
series then outstanding shall consent thereto in writing or by voting therefor
in person or by proxy at a meeting of such holders called for such purpose.
(b) The $5 Preferred Stock, the Serial Preferred Stock and the
Preferred Stock A are hereinafter sometimes referred to collectively as the
"Preferred Stocks," and the Serial Preferred Stock and the Preferred Stock A
are hereinafter sometimes referred to collectively as the "Serial Stocks."
(2)(a) The $5 Preferred Stock pari passu with the Serial Stocks shall
be entitled, in preference to the Preference Stock and the Common Stock, to
dividends at the rate of $5 per share per annum, and the Serial Stocks pari
passu with the $5 Preferred Stock shall be entitled, in preference to the
Preference Stock and the Common Stock, to dividends at the rate or rates as to
each series thereof fixed by resolution of the Board of Directors establishing
such series of Serial Stocks, payable as the Board of Directors may from time
to time determine. Dividends on the $5 Preferred Stock shall be cumulative
from and after April 1, 1926, or in the case of $5 Preferred Stock issued
after April 1, 1926, from the date of issue of such $5 Preferred Stock unless
the Company shall have then established regular dividend periods with respect
to its said $5 Preferred Stock, in which event the dividends shall be
cumulative from the first day of the current dividend period within which such
$5 Preferred Stock shall be issued. Dividends on each series of the Serial
Preferred Stock shall be cumulative from the first day of the current dividend
period within which such stock shall be issued and dividends on each share of
Preferred Stock A shall be cumulative from the date on which such share shall
originally have been issued and shall be payable quarterly on the first day of
the months of January, April, July and October. When the stated dividends are
not paid in full on all shares of the Preferred Stock such shares shall share
pro rata in the payment of dividends including accumulations, if any, in
accordance with the sums which would be payable on such shares if all
dividends, including accumulations, if any, were paid in full.
(b) In any distribution of assets other than by dividends from
surplus or profits, the Preferred Stocks shall also have a preference over the
Preference Stock and the Common Stock, until there shall have been paid or set
apart for payment (i) on each share of the Preferred Stocks issued prior to
June 1, 1980, One Hundred Dollars ($100.00), and (ii) on each share of
Preferred Stock issued on or after June 1, 1980, the liquidation value thereof
fixed by resolution of the Board of Directors establishing such series of
Preferred Stock, plus in each case the amount, if any, by which dividends at
the rate or rates per annum fixed for such stock from and after the respective
dates on which dividends on such stock became cumulative to the date of such
distribution exceeds the dividends actually paid thereon or declared and set
apart for payment thereon. If, in any distribution of assets, the assets
distributable shall be insufficient to permit payment to the holders of the
Preferred Stocks of the full amounts to which they are respectively entitled
as aforesaid, then such assets shall be distributed pro rata among the holders
of the Preferred Stocks in proportion to the sums which would be payable on
such distribution of assets if all such sums were paid in full.
(c) If and so long as any quarterly dividend on any of the
Preferred Stocks shall be in arrears, or if any voluntary or involuntary
liquidation of the Company shall have been commenced and the amount payable
with respect to any of the Preferred Stocks on such liquidation shall have not
been paid in full, or if at any time the Company shall not have made all
payments then or theretofore due under the terms of the sinking fund for the
purchase or redemption of any series of Preferred Stock A, the Company shall
not pay or declare any dividends on, or make any other distribution on, or
redeem, purchase or otherwise acquire for value (including, without
limitation, pursuant to any sinking fund therefor) any shares of, the Common
Stock, Preference Stock or any other class of stock of the company ranking
subordinate to the Preferred Stocks as to the payment of dividends or the
distribution of assets.
(3) The Preferred Stocks and the Preference Stock shall not receive
any dividends or shares in distribution in excess of the amounts herein
expressly provided, but after the payment of the dividends and/or shares in
distribution of assets to which the Preferred Stocks and the Preference Stock,
respectively, are entitled, in accordance with the provisions herein set
forth, the Common Stock, subject to the rights of any class of stock hereafter
authorized, shall receive all further dividends and shares in distribution.
(4) Each holder of the $5 Preferred Stock, Serial Preferred Stock
and/or Common Stock shall be entitled to one vote for each share of such stock
held by him.
(5) If and when dividends payable on any of the Preferred Stocks shall
be in default in an amount equivalent to four full quarterly payments or more
per share, and thereafter until all dividends on any of the Preferred Stocks
in default shall have been paid, the holders of all of the then outstanding
Preferred Stocks, voting as a class, shall be entitled to elect the smallest
number of directors necessary to constitute a majority of the full Board of
Directors, and the holders of the Common Stock, voting as a class, subject to
the rights of the holders of the Preference Stock, shall have the right to
elect the remaining directors of the company, anything herein or in the By-
laws to the contrary notwithstanding. The terms of office, as directors, of
all persons who may be directors of the Company at the time shall terminate
upon the election of a majority of the Board of Directors by the holders of
the Preferred Stocks, except that, if the holders of the Common Stock shall
not have elected the remaining directors of the Company because of the lack of
a quorum consisting of a majority of the outstanding Common Stock, and subject
to the rights of the holders of the Preference Stock, then such remaining
directors shall be elected by those directors whose term of office is thus
terminated and who have not been elected by the holders of the Preferred
Stocks as a class; and, in that event, such elected directors shall hold
office for the interim period pending such time as a quorum shall be present
at a meeting of stockholders held for the election of directors by the Common
Stockholders as a class.
(6) If and when all dividends then in default on any of the Preferred
Stocks then outstanding shall be paid (and such dividends shall be declared
and paid out of any funds legally available therefor as soon as reasonably
practicable), the holders of the Preferred Stocks shall be divested of any
special right with respect to the election of directors, and the voting power
of the holders of the Preferred Stocks and the holders of the Common Stock
shall revert, subject to the rights of the holders of the Preference Stock, to
the status existing before the first dividend payment date on which dividends
on any of the Preferred Stocks were not paid in full; but always subject to
the same provisions for vesting such special rights in the holders of the
Preferred Stocks in case of further like default or defaults in dividends
thereon. Upon the termination of any such special voting right, the terms of
office of all persons who may have been elected directors of the Company by
vote of the holders of the Preferred Stocks, as a class, pursuant to such
special voting right shall forthwith terminate, and the resulting vacancies
shall be filled by the vote of a majority of the remaining directors.
(7) In case of any vacancy in the office of a director occurring among
the directors elected by the holders of the Preferred Stocks, voting as a
class, the remaining directors elected by the holders of the Preferred Stocks,
by affirmative vote of a majority thereof or the remaining director so elected
if there be but one, may elect a successor or successors to hold office for
the unexpired term of the director or directors whose place or places shall be
vacant. Likewise in case of any vacancy in the office of a director occurring
among the directors not elected by the holders of the Preferred Stocks,
subject to the provisions of subdivision (28) below, the remaining directors
not elected by the holders of the Preferred Stocks or the Preference Stock, by
affirmative vote of a majority thereof, or the remaining director so elected
if there be but one, may elect a successor or successors to hold office for
the unexpired term of the director or directors whose place or places shall be
vacant.
(8) Whenever the right shall have accrued to the holders of the
Preferred Stocks to elect directors, voting as a class, then upon request in
writing signed by any holder of Preferred Stocks entitled to vote, delivered
by registered mail or in person to the president, a vice-president or
secretary, it shall be the duty of such officer forthwith to cause notice to
be given to the shareholders entitled to vote of a meeting to be held at such
time as such officer may fix, not less than ten (10) nor more than sixty (60)
days after the receipt of such request, for the purpose of electing directors.
At all meetings of stockholders held for the purpose of electing directors
during such time as the holders of the Preferred Stocks shall have the special
right, voting as a class, to elect directors, the presence in person or by
proxy of the holders of a majority of the outstanding Common Stock shall be
required to constitute a quorum of such class for the election of directors,
and the presence in person or by proxy of the holders of a majority of the
outstanding Preferred Stocks shall be required to constitute a quorum of such
class for the election of directors; provided, however, that the absence of a
quorum of the holders of stock of either such class shall not prevent the
election at any such meeting or adjournment thereof of directors by the other
such class if the necessary quorum of the holders of stock of such other class
is present in person or by proxy at such meeting or any adjournment thereof;
and provided further that in the event a quorum of the holders of the Common
Stock is present but a quorum of the holders of the Preferred Stocks is not
present, then the election of the directors elected by the holders of the
Common Stock shall not become effective and the directors so elected by the
holders of the Common Stock shall not assume their offices and duties until
the holders of the Preferred Stocks, with a quorum present, shall have elected
the directors they shall be entitled to elect; and provided further, however,
that in the absence of a quorum of the holders of stock of either class, a
majority of the holders of the stock of the class who are present in person or
by proxy shall have power to adjourn the election of the directors to be
elected by such class from time to time without notice other than announcement
at the meeting until the requisite number of holders of such class shall be
present in person or by proxy, but such adjournment shall not be made to a
date beyond the date for the mailing of notice of the next annual meeting of
the Company or special meeting in lieu thereof.
(9) Upon the affirmative vote of a majority of the shares of the
issued and outstanding Common Stock at any annual meeting or at any special
meeting called for the purpose, the $5 Preferred Stock may be redeemed in
whole or in part at any time at One Hundred Ten Dollars ($110) for each share
of the $5 Preferred Stock redeemed plus the amount, if any, by which Five
Dollars ($5) per annum upon such shares from the date after which dividends
thereon became cumulative to the date of redemption exceeds the dividends
actually paid thereon or declared and set apart for payment thereon from such
date to the date of redemption. If, pursuant to such vote, less than all of
the shares of the $5 Preferred Stock are to be redeemed, the shares to be
redeemed shall be selected by lot, in such manner as the Board of Directors
shall determine, by an independent bank or trust company selected for that
purpose by the Board of Directors.
(10) Upon the vote of a majority of the full Board of Directors the
Company may redeem any series of the Serial Stocks in whole or in part at any
time at the redemption price or prices fixed for said series of Serial Stocks
by resolution or resolutions of the Board of Directors establishing said
series, plus, as to each share or shares so redeemed, the amount, if any, by
which the rate of dividends per annum fixed for such share or shares redeemed
from and after the date on which dividends thereon became cumulative to the
date of redemption exceeds the dividends actually paid thereon or declared and
set apart for payment thereon from such date to the date of redemption. If,
pursuant to such vote, less than all of the shares of any series of the Serial
Preferred Stock are to be redeemed, the shares to be redeemed shall be
selected by lot, in such manner as the Board of Directors shall determine, by
an independent bank or trust company selected for that purpose by the Board of
Directors. If, pursuant to such vote, less than all of the shares of any
series of the Preferred Stock A are to be redeemed, the shares to be redeemed
shall be selected pro rata or by lot as the Board of Directors may determine
in the resolution or resolutions establishing each series of Preferred Stock
A, or if not determined therein, in any resolution adopted thereafter.
(11) Notice of the intention of the Company to redeem any shares of the
Preferred Stocks shall be mailed thirty days before the date of redemption to
each holder of record of the shares to be redeemed, at his last known post
office address as shown by the records of the Company. At any time after such
notice has been mailed as aforesaid the Company may deposit, or may cause its
nominee to deposit, the aggregate redemption price (or the portion thereof not
already paid in the redemption of shares so to be redeemed) with any bank or
trust company in the City of New York, a member of the Clearing House of the
City of New York, named in such notice, payable in amounts aforesaid to the
respective orders of the record holders of the shares so to be redeemed, on
endorsement and surrender of their certificates, and thereupon said holders
shall cease to be stockholders with respect to said shares and from and after
the making of such deposit said holders shall have no interest in or claim
against the Company or its nominee with respect to said shares, but shall be
entitled only to receive said moneys from said bank or trust company without
interest. If the shares to be redeemed shall be shares of the $5 Preferred
Stock or any series of Serial Preferred Stock, and if such deposit shall be
made by the nominee of the Company as aforesaid, such nominee shall upon such
deposit become the owner of the shares with respect to which such deposit is
made and certificates of stock may be issued to such nominee in evidence of
such ownership. The Company may require any shares of the $5 Preferred Stock
or any series of Serial Preferred Stock so called for redemption to be
delivered, duly assigned, to a nominee upon payment by such nominee to the
holder of said shares of all amounts payable on such redemption. Any shares
of the $5 Preferred Stock or any series of Serial Preferred Stock delivered to
or acquired by the nominee of the Company under the provisions hereof shall be
converted into or exchanged for such other securities of the Company and on
such terms as on or before such delivery or acquisition may have been provided
by the Company in accordance with the next three paragraphs hereof.
(12) The Company from time to time may sell any of its own stocks,
acquired by it at such price as may be fixed by its Board of Directors or
Executive Committee; provided, however, that any shares of any series of
Preferred Stock A redeemed, purchased or otherwise acquired (including,
without limitation, pursuant to the sinking fund therefor) by the Company
shall be cancelled and shall not be reissued as shares of such series, but
shall be restored to the status of authorized but unissued shares of Preferred
Stock A.
(13) The Company, subject to the restrictions herein set forth, in
order to acquire funds with which to redeem any Preferred Stocks or Preference
Stock may issue and sell stock of any class then authorized but unissued,
bonds, notes, evidences of indebtedness, or other securities.
(14) The Board of Directors may at any time authorize the conversion or
exchange of the whole or any particular shares of the outstanding $5 Preferred
Stock or the Serial Preferred Stock, with the consent of the holder thereof,
into or for stock of any other class at the time of such consent then
authorized but unissued and may fix the terms and conditions upon which such
conversion or exchange may be made; provided that without the consent of the
holders of record of two-thirds of the shares of Common Stock outstanding
given at a meeting of the holders of the Common Stock called and held as
provided by the By-laws or given in writing without a meeting, the Board of
Directors shall not authorize the conversion or exchange of any $5 Preferred
Stock or any Serial Preferred Stock into or for Common Stock or authorize the
conversion or exchange of any $5 Preferred Stock or any Serial Preferred Stock
into or for Preferred Stock of any other class, if by such conversion or
exchange the amount which the holders of the shares of $5 Preferred Stock or
the Serial Preferred Stock so converted or exchanged would be entitled to
receive either as dividends or shares in distribution of assets in preference
to the Common Stock would be increased.
(15) No holder of any stock of the Company shall be entitled as of
right to purchase or subscribe for any part of any authorized stock of the
Company or of any additional stock of any class to be issued by reason of any
increase of the authorized Capital Stock of the Company or of any bonds,
certificates of indebtedness, debentures, or other securities convertible into
stock of the Company, but any authorized stock or any such additional
authorized issue of new stock or of securities convertible into stock may be
issued and disposed of by the Board of Directors to such persons, firms,
corporations or associations for such consideration and upon such terms and in
such manner as the Board of Directors may in their discretion determine
without offering any thereof, on the same terms or on any terms, to the
stockholders then of record or to any class of stockholders.
(16) A consolidation, merger or amalgamation of the Company with or
into any other corporation or corporations shall not be deemed a distribution
of assets of the Company within the meaning of any provision herein.
(17) No new class of stock shall hereafter be created or authorized
which is entitled to dividends or shares in distribution of assets on a parity
with or in priority to the $5 Preferred Stock nor shall there be created or
authorized any securities convertible into shares of any such stock, unless
the holders of record of not less than two-thirds of the number of shares of
the $5 Preferred Stock then outstanding shall consent thereto in writing or by
voting therefor in person or by proxy at the meeting of stockholders at which
the creation or authorizing of such new class of stock or such convertible
securities is considered; and provided further that no new class of stock
shall hereafter be created or authorized which is entitled to dividends or
shares in distribution of assets in priority to the Serial Stocks nor shall
there be created or authorized any securities convertible into shares of any
such stock, unless the holders of record of not less than two-thirds of the
number of shares then outstanding of each class of the Serial Stocks so
affected shall consent thereto in writing or by voting therefor in person or
by proxy at the meeting of stockholders at which the creation or authorizing
of such new class of stock or such convertible securities is considered. Any
vote creating or authorizing a new class of stock may provide that all moneys
payable by the Company with respect to any class of stock thereby authorized
shall be paid in the money of any foreign country named therein or designated
by the Board of Directors, pursuant to authority therein granted, at a fixed
rate of exchange with the money of the United States of America therein stated
or provided for and all such payments shall be made accordingly. Any such
vote may authorize any shares of any class then authorized but unissued to be
issued as shares of such new class or classes.
(18) So long as any shares of the Preferred Stocks are outstanding, the
Company shall not, without the consent (given by vote at a meeting held
pursuant to notice containing a statement of such purpose) of the holders of a
majority of the total number of shares of the Preferred Stocks considered as
one class, then outstanding:
(a) Increase the total authorized amount of any class of the
Preferred Stocks; or
(b) Merge or consolidate with or into any other corporation or
corporations, unless such merger or consolidation, or the exchange, issuance
or assumption of all securities to be issued or assumed in connection with any
such merger or consolidation, shall have been ordered, approved or permitted
by the Securities and Exchange Commission under the provisions of the Public
Utility Holding Company Act of 1935 or by any successor commission or other
regulatory authority of the United States of America having jurisdiction over
the exchange, issuance or assumption of securities in connection with such
merger similar to that conferred upon the Securities and Exchange Commission
by such Act; provided that the provisions of this clause (b) shall not apply
to a purchase or other acquisition by the Company of franchises or assets of
another corporation in any manner which does not involve a merger or
consolidation; or
(c) Issue shares of any of the Preferred Stocks or of any other
class of stock ranking prior to or on a parity with any of the Preferred
Stocks as to dividends or distributions, unless the net income of the company,
determined after provisions for depreciation and all taxes, and in accordance
with generally accepted accounting practices to be available for the payment
of dividends for a period of twelve (12) consecutive calendar months within
the fifteen (15) calendar months immediately preceding the issuance, sale or
disposition of such stock, is at least equal to twice the annual dividend
requirements on all outstanding shares of the Preferred Stocks and of all
other classes of stock ranking prior to, or on a parity with, any of the
Preferred Stocks as to dividends or distributions, including the shares
proposed to be issued, and unless the gross income of the Company for said
period, determined in accordance with generally accepted accounting practices
(but in any event after deducting the amount for said period charged by the
Company on its books to depreciation expense and all taxes) to be available
for the payment of interest, shall have been at least one and one-half times
the sum of (i) the annual interest charges on all interest bearing
indebtedness of the Company and (ii) the annual dividend requirements on all
outstanding shares of the Preferred Stocks and of all other classes of stock
ranking prior to, or on a parity with the Preferred Stocks as to dividends or
distributions, including the shares proposed to be issued. There shall be
excluded from the foregoing computation, interest charges on all indebtedness
and dividends on all stock which are to be retired in connection with the
issue of such additional shares of stock. Where such additional shares of
stock are to be issued in connection with the acquisition of new property, the
net earnings of the property to be so acquired may be included on a pro forma
basis in the foregoing computation, computed on the same basis as the net
earnings of the Company; or
(d) Issue shares of the Preferred Stocks, or of any other class
of stock ranking prior to or on a parity with any of the Preferred Stocks as
to the payment of dividends or the distribution of assets, unless the
aggregate of the capital of the Company applicable to the Common Stock and the
surplus of the Company shall be not less than the aggregate stated value of
the Preferred Stocks, and of any other class of stock ranking prior to or on a
parity with any of the Preferred Stocks as to the payment of dividends or the
distribution of assets, to be outstanding immediately after the proposed issue
of such additional Preferred Stocks, excluding from the foregoing computation
all indebtedness and stock which are to be retired in connection with the
issue of such additional shares of Preferred Stocks, or of any other class of
stock ranking prior to or on a parity with any of the Preferred Stocks as to
the payment of dividends or the distribution of assets, provided that no
portion of the surplus of the Company which shall be used to meet the
requirements of this paragraph (d) shall, after the issue of such additional
shares of Preferred Stocks, or of any other class of stock ranking prior to or
on a parity with any of the Preferred Stocks as to the payment of dividends or
the distribution of assets, and until such shares or a like number of other
shares of Preferred Stocks, or of any other class of stock ranking prior to or
on a parity with any of the Preferred Stocks as to the payment of dividends or
the distribution of assets, shall have been retired, be available for
dividends or other distribution upon the Common Stock.
(19) So long as any shares of Preferred Stocks are outstanding the
Company shall not pay any dividends (other than dividends on Common Stock
payable by the issuance of Common Stock) on, or make any distribution on, or
redeem, purchase or otherwise acquire for value, any of its Common Stock or
Preference Stock or other stock, if any, subordinate to such Preferred Stocks
as to the payment of dividends or the distribution of assets, if, after giving
effect to any such payment, distribution, redemption, purchase or other
acquisition, the aggregate amount of such dividends, distributions, purchases
and acquisitions paid or made subsequent to December 31, 1945, exceeds (a) 50%
of the aggregate of net income available for Common Stock subsequent to
December 31, 1945, if, at the end of the calendar month immediately preceding
the dividend declaration date, the Common Stock Equity is less than 20% of
total capitalization, including surplus, or (b) 75% of the aggregate of net
income available for Common Stock subsequent to December 31, 1945, if, at the
end of the calendar month immediately preceding the dividend declaration date,
the Common Stock Equity is less than 25% but at least 20% of total
capitalization, including surplus; provided that, when the Common Stock equity
shall have reached 25% of total capitalization, including surplus, all
restrictions on the payment of dividends on the Common Stock, or the purchase
or acquisition of, or distributions on, the Common Stock, shall be, so long as
such ratio remains at 25% or above, eliminated; provided further that, after
once having reached such ratio of 25%, no dividends on or distributions,
purchases or acquisitions of Common Stock shall be paid or made, aggregating
an amount in excess of 75% of the current year's earnings otherwise available
for Common Stock, if, after such payment, distribution, purchase or
acquisition, the ratio of the Common Stock Equity to the total capitalization,
including surplus, will be less than 25% but not less than 20%; and provided
further that, after having once reached a ratio of 20%, no dividends on or
distributions, purchases or acquisitions of Common Stock shall be paid or
made, aggregating an amount in excess of 50% of the current year's earnings
otherwise available for Common Stock, if, after such payment, distribution,
purchase or acquisition, the ratio of the Common Stock Equity to the total
capitalization, including surplus, will be less than 20%. As used in this
paragraph the term "Common Stock Equity" shall mean the aggregate of (a)
stated value of Common Stock of the Company (including proceeds from the sale
of issuance of Common Stock subsequent to December 31, 1945) and (b) surplus.
(20) The consideration received by the Company from the issuance and
sale of any additional shares of Common Stock without nominal or par value
shall be entered in its capital stock account and the provisions of this
paragraph shall not be changed unless the holders of record of not less than
two-thirds (2/3) of the number of shares of the Preferred Stocks then
outstanding, voting as a single class, and of not less than two-thirds of the
number of shares of Common Stock then outstanding, voting separately as a
class shall consent thereto in writing or by voting therefor in person or by
proxy at the meeting of stockholders at which any such change is considered.
PREFERENCE STOCK
(21) The Board of Directors is authorized to issue at any time and from
time to time one or more series of Preference Stock as hereinafter provided.
(22) To the extent that variations in the designations, preferences,
limitations and relative rights as between series of the Preference Stock are
not established, fixed and determined herein, authority is hereby expressly
vested in the Board of Directors to fix and determine the designations,
preferences, limitations and relative rights of the shares of any series of
such Preference Stock hereinafter established, including authority to fix any
one or more of the following:
(a) The distinctive designations of such series and the number of
shares which shall constitute such series;
(b) The rate of dividend;
(c) The right of redemption, if any, and the price at and the
terms and conditions on which the shares may be redeemed;
(d) The amount payable upon shares in event of involuntary
liquidation;
(e) The amount payable upon shares in event of voluntary
liquidation;
(f) Sinking fund provisions, if any, for the redemption or
purchase of shares; and
(g) The terms and conditions on which shares may be converted, if
the shares of any series are issued with the privilege of
conversion.
(23) All shares of Preference Stock regardless of series shall be
identical with each other in all respects except as provided in subdivision
(22) above.
(24) The Preference Stock is subject to the prior rights and
preferences of the Preferred Stocks and all other classes of preferred stock
of equal rank therewith hereafter authorized.
(25) Subject to the prior rights and preferences of the Preferred
Stocks, the holders of Preference Stock of each series shall be entitled to
receive, out of any funds legally available for the purpose, when and as
declared by the Board of Directors, cumulative cash dividends thereon at such
rate per annum as fixed by resolution of the Board of Directors establishing
such series. Dividends on the Preference Stock of each series shall be
payable quarterly on the first day of the months of January, April, July and
October in each year or otherwise as the Board of Directors may determine
prior to the issue thereof. Dividends on Preference Stock of each series
shall be cumulative with respect to each share from such date, if any, as may
be fixed by resolution of the Board of Directors prior to the issue thereof
or, if no such date is established, from the date on which such shares shall
originally have been issued. Accumulation of dividends shall not bear
interest.
(26) In the event of any partial or complete liquidation, dissolution
or winding up of the affairs of the Company, whether voluntary or involuntary,
before any distribution shall be made to the holders of any shares of Common
Stock, but subject to the prior rights and preferences of the Preferred
Stocks, the Preference Stock of each series shall be entitled, pari passu with
all stock of equal rank, to receive for each share thereof, out of any legally
available assets of the Company, the amount or amounts fixed therefor by
resolution of the Board of Directors establishing such series, plus, in each
case, an amount equal to all cumulated unpaid dividends thereon, whether or
not declared or earned, accrued to the date when payment of such preferential
amounts shall be made available to the holders of the Preference Stock; and
the Preference Stock shall be entitled to no further participation in such
distribution.
If, upon any such liquidation, dissolution or winding up of the
affairs of the Company, the assets of the Company legally available for
distribution as aforesaid among the holders of the Preference Stock of all
series and all stock of equal rank shall be insufficient to permit the payment
to them of the full preferential amounts aforesaid, then the entire assets of
the Company so to be distributed shall be distributed ratably among the
holders of the Preference Stock of all series and of all stock of equal rank
in proportion to the full preferential amounts to which they are respectively
entitled.
A consolidation or merger of the Company, or a sale or transfer of
all or substantially all of its assets as an entirety shall not be regarded as
a "liquidation, dissolution or winding up of the affairs of the Company"
within the meaning of this subdivision (26).
(27) The Company may, unless otherwise prohibited by any provisions of
the Company's Charter, as amended, or by any resolution adopted by the Board
of Directors providing for the issuance of any series of Preference Stock of
which there are shares then outstanding, at its option, expressed by
resolution of its Board of Directors, at any time redeem the whole or any part
of the Preference Stock or of any series thereof at the time outstanding, by
the payment in cash for each share of stock to be redeemed of the then
applicable redemption price or prices as shall be fixed by resolution of the
Board of Directors establishing such series, plus, in any such case, a sum of
money equivalent to all accrued and cumulated unpaid dividends, whether or not
declared or earned, thereon to the date fixed for redemption.
Notice of any proposed redemption of shares of Preference Stock
shall be given by the Company by mailing a copy of such notice at least 30
days prior to the date fixed for such redemption to the holders of record of
the shares of Preference Stock to be redeemed, at their respective addresses
appearing on the books of the Company. Said notice shall specify the shares
called for redemption, the redemption price and the place at which and the
date on which the shares called for redemption will, upon presentation and
surrender of the certificates of stock evidencing such shares, be redeemed and
the redemption price therefor paid.
If less than all of the shares of any series of Preference Stock
then outstanding are to be redeemed, the shares to be redeemed shall be
selected by such method, either by lot or pro rata, as shall from time to time
be determined by resolution of the Board of Directors.
From and after the date fixed in any such notice as the date of
redemption, unless default shall be made by the Company in providing moneys at
the time and place specified for the payment of the redemption price pursuant
to said notice, all dividends on the shares of Preference Stock thereby called
for redemption shall cease to accrue and all rights of the holders thereof as
stockholders of the Company except the right to receive the redemption price,
but without interest, shall cease and determine; provided, however, the
Company may, in the event of any such redemption, and prior to the redemption
date specified in the notice thereof, deposit in trust, for the account of the
holders of the shares of Preference Stock to be redeemed, with any bank or
trust company located in the City of Raleigh, North Carolina, or the City of
New York, New York, named in such notice and having a capital, surplus and
undivided profits aggregating at least $5,000,000, all funds necessary for
such redemption, and thereupon all shares of the Preference Stock with respect
to which such deposit shall have been made shall forthwith upon the making of
such deposit no longer be deemed to be outstanding and all rights of the
holders thereof with respect to such shares of Preference Stock shall
thereupon cease and terminate, except the right of such holders to receive
from the funds so deposited the amount payable upon the redemption thereof,
but without interest, or, if any right of conversion conferred upon such
shares shall not, by the terms thereof, previously have expired, to exercise
the right to conversion thereof on or before the redemption date specified in
such notice, unless such right of conversion by the terms thereof expires at
an earlier time, and then only on or before such earlier time for the
expiration of such right of conversion. Any funds so set aside or deposited
which, because of the exercise of any right of conversion of shares called for
redemption, shall not be required for such redemption, shall be released or
repaid forthwith to the Company. Any funds so set aside or deposited, which
shall be unclaimed at the end of six years from such redemption date, shall be
released or repaid to the Company upon its request expressed in a resolution
of its Board of Directors, and any depositary thereof shall thereby be
relieved of all responsibility in respect thereof, after which release or
repayment the holders of shares so called for redemption shall look only to
the Company for payment of the redemption price, but without interest. Any
interest on funds so deposited which may be allowed by any bank or trust
company with which such deposit was made shall belong to the Company.
If and so long as any quarterly dividend on any series of the
Preferred Stocks or the Preference Stock shall be in arrears, the Company
shall not redeem, purchase or otherwise acquire, by way of sinking fund
payments or otherwise, any Preference Stock.
Whenever there shall be deposited or set aside the whole or any
part of the funds required to be deposited or set aside by the Company as a
sinking fund for any series of Preference Stock there shall be also deposited
or set aside at the same time the full amount or the same proportionate part,
as the case may be, of the funds, if any, then due to be deposited or set
aside as sinking fund for each other series of Preference Stock then
outstanding.
All shares of Preference Stock which shall have been redeemed,
converted, purchased or otherwise acquired by the Company shall be retired and
cancelled and shall have the status of authorized but unissued shares of
Preference Stock.
(28) Except as otherwise provided by law, the holders of the Preference
Stock shall not have any right to vote for the election of directors or for
any other purpose except as set forth below.
In the event that at any time, or from time to time, when
dividends payable on any shares of Preference Stock shall be in default in an
amount equivalent to six quarterly dividends, or more, per share, and
thereafter until all dividends of Preference Stock in default shall have been
paid, the holders of the Preference Stock, voting as a single class separate
from the holders of all other classes of stock, shall be entitled to elect two
directors, subject to the prior rights of the holders of the Preferred Stocks.
The terms of office, as directors, of all persons who may be directors of the
Company, except those directors, if any, elected by the holders of the
Preferred Stocks voting separately as a single class, shall terminate upon the
election of two directors by the holders of the Preference Stock. Subject to
the prior rights of the Preferred Stocks and the Preference Stock, the holders
of the Common Stock, voting as a single class, shall have the right to elect
the remaining directors of the Company. If the holders of the Common Stock
have not exercised their right to elect directors of the Company because of
the lack of a quorum consisting of a majority of the Common Stock, then the
said remaining directors shall be elected by the directors whose term of
office is thus terminated and who have not been elected by the holders of the
Preferred Stocks; and in that event, such elected directors shall hold office
for the interim period, pending such time as a quorum of the Common Stock
shall be present at a meeting held for the election of directors.
If and when all dividends then in default on the Preference Stock,
then outstanding, shall be paid (and such dividends shall be declared and paid
out of any funds legally available therefor as soon as reasonably
practicable), the holders of the Preference Stock shall be divested of any
special right with respect to the election of directors, and the voting power
of the holders of the Preference Stock shall revert to the status existing
before the first dividend payment date on which dividends on any share of the
Preference Stock were not paid in full; but always subject to the same
provisions for vesting such special rights in the holders of the Preference
Stock in case of further like default or defaults on dividends thereon. Upon
the termination of any such special voting right, the terms of office of all
persons who may have been elected directors of the Company by vote of the
holders of the Preference Stock as a class, pursuant to such special voting
right shall forthwith terminate, and the resulting vacancies shall be filled
by the vote of a majority of the remaining directors.
In case of any vacancy in the office of a director occurring among
the directors elected by the holders of the Preference Stock voting as a
single class, separate from the holders of all other classes of stock, the
remaining director elected by the holders of the Preference Stock, may elect a
successor to hold office for the unexpired term of the director whose place
shall be vacant. In the event of simultaneous vacancies among directors
elected by the holders of the Preference Stock, an election, pursuant to the
provisions of this subdivision (28) will be held.
Whenever the right shall have accrued to the holders of the Preference
Stock to elect directors, voting as a single class, separate from the holders
of all other classes of stock, then upon request in writing signed by any
holder of the Preference Stock entitled to vote, delivered by registered mail
or in person to the president, a vice-resident or secretary of the Company, it
shall be the duty of such officer forthwith to cause notice to be given to the
shareholders entitled to vote at a meeting to be held at such time as such
officer may fix, not less than ten (10) nor more than sixty (60) days after
the receipt of such request, for the purpose of electing directors. At all
meetings of shareholders held for the purpose of electing directors during
such time as the holders of the Preference Stock shall have the special right,
voting as single class, separate from the holders of all other classes of
stock to elect directors, the presence in person or by proxy of the holders of
a majority of the outstanding Preference Stock shall be required to constitute
a quorum of such class for election of directors, and the presence in person
or by proxy of the holders of a majority of all other classes of stock
outstanding at the time, and not entitled to such special right, shall be
required to constitute a quorum of such other classes for the election of
directors.
(29) So long as any shares of the Preference Stock shall remain
outstanding, no dividend (other than a dividend payable in shares of Common
Stock) shall be paid or declared, nor shall any distribution be made on Common
Stock and no Common Stock shall be redeemed, purchased, retired or otherwise
acquired either directly or indirectly, unless:
(i) All dividends on the Preference Stock of all series then
outstanding for all past quarterly dividend periods and for the current
quarterly dividend period shall have been paid or declared and a sum
sufficient for the payment thereof set apart; and
(ii) All sinking fund payments and all purchase fund payments or
other obligations of the Company for the periodic retirement of shares of
Preference Stock of all series then outstanding required to have been made or
performed by the Company shall have been made or performed.
(30) The affirmative approval of the holders of at least two-thirds
(2/3) of the Preference Stock at the time outstanding, voting as a class
without regard to series, shall be required for any amendment of the Company's
Charter altering materially any existing provision of the Preference Stock or
for the creation, or an increase in the authorized amount, of any class of
stock (other than the 300,000 authorized shares of $5 Preferred Stock and the
10,000,000 authorized shares of Serial Preferred Stock) ranking, as to
dividends or assets, prior to the Preference Stock, and the affirmative
approval of the holders of at least a majority of the Preference Stock at the
time outstanding, voting as a class without regard to series, shall be
required for an increase in the authorized amount of the Preference Stock or
for the creation, or an increase in the authorized amount, of any class of
stock ranking, as to dividends or assets, on a parity with the Preference
Stock; provided, however, that if any amendment of the Company's Charter shall
affect adversely the rights of preferences of one or more, but not all, of the
series of Preference Stock at the time outstanding or shall unequally
adversely affect the rights or preferences of different series of Preference
Stock at the time outstanding, the affirmative approval of the holders of at
least two-thirds (2/3) of such shares of each such series so adversely or
unequally adversely affected shall be required in lieu of or (if such
affirmative approval is required by law) in addition to the affirmative
approval of the holders of at least two-third (2/3) of the outstanding shares
of Preference Stock as a class.
(31) No holder of Preference Stock shall have any preemptive right to
purchase, subscribe for or otherwise acquire securities of the Company upon
the issuance or sale by the Company of any type of security.
FIFTH: The period of the duration of the Company shall be nine hundred
and ninety-nine years from April 6, 1926.
SIXTH: The number of directors of the Company shall be fourteen. Seven
directors shall constitute a quorum. The names and addresses of the persons
who are currently serving as directors are:
Name Address
Daniel D. Cameron, Sr. 404 West Renovah Circle
Wilmington, NC 28401
Felton J. Capel 1009 West New Hampshire Avenue
Southern Pines, NC 28387
George H.V. Cecil 436 Vanderbilt Road
Biltmore, NC 28803
Charles W. Coker, Jr. Rt 5, Greenbrier Road
Hartsville, SC 29550
Margaret T. Harper 105 East Bay Street
Southport, NC 28461
Shearon Harris 2516 Wake Drive
Raleigh, NC 27608
L. H. Harvin, Jr. 935 Hargrove Street
Henderson, NC 27536
Karl G. Hudson, Jr. 2416 White Oak Road
Raleigh, NC 27609
J. A. Jones 3004 Sandia Drive
Raleigh, NC 27607
Edward G. Lilly, Jr. 612 Scotland Street
Raleigh, NC 27609
A.C. Monk, Jr. 207 West Church Street
Farmville, NC 27828
Sherwood H. Smith, Jr. 408 Drummond Drive
Raleigh, NC 27609
Horace L. Tilghman, Jr. 104 Oakenwald Street
Marion, SC 29571
John F. Watlington, Jr. 2020 Virginia Road
Winston-Salem, NC 27104
SEVENTH: The officers of the Company shall be as prescribed by its Board
of Directors and set forth in the Company's By-laws.
EIGHTH: All corporate powers shall be exercised by the Board of
Directors except as a otherwise provided by statute or by this Restated
Charter.
NINTH: An Executive Committee may be appointed by and from the Board of
Directors in such manner and subject to such regulations as may be provided in
the by-laws, which committee shall have and may exercise, when the Board is
not in session, all the powers of said Board which may be lawfully delegated,
subject to such limitations as may be provided in the by-laws or by
resolutions of the Board.
TENTH: A director of the Company shall not be disqualified by his office
from dealing or contracting with the Company either as a vendor, purchaser or
otherwise, nor shall any transaction or contract of the Company be void or
voidable by reason of the fact that any director or any firm of which any
director is a member or any corporation of which any director is a shareholder
or director, is in anyway interested in such transaction or contract, provided
that such transaction or contract is or shall be authorized, ratified or
approved either (1) by a vote of a majority of a quorum of the Board of
Directors or of the Executive Committee without counting in such majority or
quorum any director so interested or member of a firm so interested or a
shareholder or director of a corporation so interested, or (2) by vote at any
stockholders' meeting of the holders of record of a majority of all the
outstanding shares of stock of the Company entitled to vote or by writing or
writings signed by a majority of such holders; nor shall any director be
liable to account to the Company for any profits realized by and from or
through any such transaction, or contract of the Company authorized, ratified
or approved as aforesaid by reason of the fact that he or any firm of which he
is a member or any corporation of which he is a shareholder or director, was
interested in such transaction or contract. Nothing herein contained shall
create any liability in the events above described or prevent the
authorization, ratification or approval of such contracts in any other manner
provided by law.
ELEVENTH: The directors shall hold office after the expiration of their
terms until their successors are elected and have qualified. An increase in
the Board of Directors shall be deemed to create vacancies in the Board, to be
filled in the manner provided by the by-laws. Each director, so long as and
if required by law to be a stockholder of the Company but not otherwise, shall
hold at least one share of stock in the Company. The Board of Directors shall
have power to hold their meetings, to have one or more offices, and to keep
the corporate books (except such books as are required by law to be kept
within the State of North Carolina) outside of the State of North Carolina at
such places as may from time to time be designated by them.
The Board of Directors shall have power to authorize and cause to be
executed mortgages or deeds of trust which shall cover and create a lien upon
all or any part of the property of the Company of whatsoever kind and
wheresoever situated, whether then owned or thereafter acquired, and to
provide in any such mortgage or deed of trust that the amount of bonds or
other evidences of indebtedness to be issued thereunder and to be secured
thereby shall be limited to a definite amount or limited only by the
conditions therein specified.
The Board of Directors shall have power from time to time to fix and
determine and to vary the amount to be reserved as a working capital, to
direct and determine the use and disposition of the working capital, and to
determine the date or dates for the declaration and payment of dividends.
Any and all of the directors may at any time be removed without cause
assigned by the vote of the holders of a majority of the total number of
shares of the Company then issued and outstanding and entitled to vote
thereon, given at a meeting called for the purpose of considering such action.
TWELFTH: The Board of Directors shall have power and power is hereby
conferred upon them from time to time to adopt, amend, add to and repeal by-
laws for the Company and any by-laws so made or any provision thereof may be
altered or repealed by vote of the holders of a majority of the total number
of shares of the Company then issued and outstanding and entitled to vote
thereon at any annual meeting or at any special meeting of stockholders called
for the purpose of considering such action.
THIRTEENTH: Stockholders shall have no rights except as conferred by
statute or by the by-laws to inspect any book, paper or account of the
Company.
FOURTEENTH: Upon the written consent or vote of the holders of a
majority in aggregate number of the shares of stock of the Company then
outstanding and entitled to vote, (1) every statute of the State of North
Carolina (a) increasing, diminishing, or in any way affecting the rights,
powers or privileges of stockholders of companies organized under the general
laws of said State, or (b) giving effect to the action taken by any part less
than all, of the stockholders of any such company, shall be binding upon the
Company and every stockholder and/or (2) amendments to the charter of the
Company authorized at the time of the making of such amendments by the laws of
the State of North Carolina may be made. No such written consent or vote
shall decrease the amounts which the holders of outstanding $5 Preferred Stock
are entitled to receive as dividends or in distribution of assets in
preference to the holders of the Common Stock or decrease the price at which
the $5 Preferred Stock may be redeemed, all as set forth in Article Fourth
hereof, unless the holders of at least 90% of the then outstanding $5
Preferred Stock consent in writing to or vote for such decrease; nor shall any
such written consent or vote (a) reduce the percentage of the shares of
outstanding $5 Preferred Stock required to take any action for which the
consent of a particular percentage of the shares of outstanding $5 Preferred
Stock is provided in Article Fourth hereof, or (b) make any other amendment,
alteration, change or repeal of the express terms of the $5 Preferred Stock
then outstanding in a manner substantially prejudicial to the holders thereof
unless the holders of record of not less than two-thirds of the number of
shares of the $5 Preferred Stock then outstanding shall consent thereto in
writing or by voting therefor in person or by proxy at the meeting at which
said vote is cast.
FIFTEENTH: This Restated Charter was adopted by the shareholders of the
corporation on the 21st day of May, 1980 in the manner prescribed by law for
adopting a charter amendment; and it supersedes the original Articles of
Incorporation and all amendments thereto.
The number of shares of the corporation outstanding at the time of such
adoption was 51,684,509; and the number of shares entitled to vote thereon was
48,504,509.
The number of shares voted for such adoption was 37,053,564; and the
number of shares voted against such adoption was 522,776.
Such adoption does not give rise to dissenter's rights nor to class
voting rights for the reason that the only effect of this Restated Charter is
to set forth without change the corresponding provisions of the Articles of
Incorporation as heretofore amended.
IN WITNESS WHEREOF, this statement is executed by the President and
Secretary of the corporation this 22nd day of May, 1980.
CAROLINA POWER & LIGHT COMPANY
By Sherwood H. Smith, Jr.
President
By J. L. Lancaster, Jr.
Secretary
STATE OF NORTH CAROLINA )
COUNTY OF WAKE )
I, Marsha H. Manning, a notary public, hereby certify that on this 22nd
day of May, 1980, personally appeared before me Sherwood H. Smith, Jr. and J.
L. Lancaster, Jr., each of whom being by me first duly sworn, declared that he
signed the foregoing documents in the capacity indicated, that he was
authorized so to sign, and that the statements therein contained are true.
By: Marsha H. Manning
Notary Public
My commission expires: June 28, 1982
EXHIBIT A
CAROLINA POWER & LIGHT COMPANY
Excerpts from Minutes
Board of Directors - December 8, 1954
RESOLVED that the Board of Directors of Carolina Power & Light Company
does hereby create and establish an initial series of the Company's Serial
Preferred Stock and does hereby fix the designation, dividend rate, and
redemption prices of said series as follows:
(1) the designation of said initial series of the Company's
Serial Preferred Stock shall by "Serial Preferred Stock,
$4.20 Series";
(2) the dividend rate of said initial series of the Company's
Serial Preferred Stock shall be $4.20 per share per annum;
(3) the redemption prices of said initial series of the
Company's Serial Preferred Stock shall be: for the period
from January 12, 1955 to and including January 12, 1960,
$104.25 per share; thereafter to and including January 12,
1965, $103.25 per share; thereafter to and including January
12, 1970, $102.50 per share; and thereafter $102.00 per share;
plus, in each case, as to each share redeemed, the amount, if
any, by which $4.20 per annum upon such share from and after
the date upon which dividends thereon shall become cumulative
to the date of redemption exceeds the dividends actually paid
thereon or declared or set apart for payment thereon from
such date to the date of redemption,
said initial series of the Company's Serial Preferred Stock otherwise to have
the preferences, voting powers, restrictions, and qualifications which are
applicable to all shares of the Company's Serial Preferred Stock, irrespective
of series, as set forth in the Agreement of Merger of Tide Water Power Company
with and into Carolina Power & Light Company, dated December 12, 1951, as
amended; and further
RESOLVED that the calendar quarters of each year are hereby established
as the regular dividend periods for the Serial Preferred Stock, $4.20 Series,
of the Company; and further....
EXHIBIT B
CAROLINA POWER & LIGHT COMPANY
Excerpts from Minutes
Board of Directors - January 17, 1967
RESOLVED, that the Board of Directors of Carolina Power & Light Company
does hereby create and establish and authorize the issuance of a new series of
the Company's Serial Preferred Stock and does hereby fix the designation,
dividend rate, and redemption prices of said series as follows:
(1) the designation of said new series of the Company's Serial
Preferred Stock shall be "Serial Preferred Stock, $5.44
Series";
(2) the Serial Preferred Stock, $5.44 Series, is hereby
authorized to be issued in the amount of 250,000 shares;
(3) the dividend rate of the Serial Preferred Stock, $5.44
Series shall be $5.44 per share per annum;
(4) the redemption prices of the Serial Preferred Stock, $5.44
Series shall be: for the period from January 24, 1967, to
and including January 24, 1974, $112 per share; thereafter to
and including January 24, 1977, $105 per share; thereafter to
and including January 24, 1982, $103 per share; and
thereafter $101 per share; plus, in each case, as to each
share redeemed, the amount, if any, by which $5.44 per annum
upon such share from and after the date upon which dividends
thereon shall become cumulative to the date of redemption
exceeds the dividends actually paid thereon or declared or
set apart for payment thereon from such date to the date of
redemption, said Serial Preferred Stock, $5.44 Series,
otherwise to have the preferences, voting powers,
restrictions, and qualifications which are applicable to all
shares of the Company's Serial Preferred Stock, irrespective
of series, as set forth in the Agreement of Merger of Tide
Water Power Company with and into Carolina Power & Light
Company, dated December 12, 1951, as amended; and further
RESOLVED, that regular dividend periods for the Serial Preferred Stock
$5.44 Series, are hereby established as the period commencing January 24,
1967 to and including March 31, 1967 and thereafter as the quarterly periods
commencing April 1, July 1, October 1, and January 1 of each year.
EXHIBIT C
STATEMENT OF CLASSIFICATION OF SHARES
OF
CAROLINA POWER & LIGHT COMPANY
The undersigned corporation hereby executes this Statement of
Classification of Shares pursuant to Section 55-42 of the North Carolina
General Statutes relating to the preferences, limitations and relative rights
of a series of a class of its shares:
1. The name of the Corporation is CAROLINA POWER & LIGHT COMPANY.
2. The Certificate of Amendment to the Charter of the corporation
adopted at a regular meeting of the shareholders duly convened and held on
March 11, 1953, contained a resolution amending the Charter, which resolution,
in part, relates to the fixing of the preferences, limitations and relative
rights of the shares of Serial Preferred Stock of the corporation, and which
authorizes the Board of Directors to issue one or more series of Serial
Preferred Stock with such dividend rates, redemption prices and series
designations as may be fixed by resolution of the Board of Directors, which
Certificate of Amendment is on file in the Office of the Secretary of State of
North Carolina, and is set out below:
"The preferences, voting powers, restrictions, and qualifications
of each of said classes of stock shall be as follows:
"The term `Serial Preferred Stock' as used herein means Preferred
Stock of any series of the 200,000 shares authorized by this Article
Fourth. The Board of Directors is authorized to issue at any time and
from time to time one or more series of Serial Preferred Stock with such
dividend rates and redemption prices and bearing such series
designations as may be fixed by the Board of Directors and stated and
expressed in the resolution or resolutions establishing the respective
series of such stock, the authority for which is hereby expressly vested
in the Board of Directors."
The number of authorized shares of Serial Preferred Stock was increased to
1,000,000 by Articles of Amendment to the Charter adopted at a regular meeting
of the shareholders in May 1969, which Articles of Amendment are on file in
the Office of the Secretary of State of North Carolina.
3. On May 4, 1970, the Board of Directors of the corporation duly
adopted resolutions authorizing the issuance and sale of 300,000 shares of a
new series of Serial Preferred Stock, without par value, designated as "Serial
Preferred Stock, $9.10 Series" bearing a dividend rate of $9.10 per share per
annum; and with the following redemption prices: $112 per share for the period
May 12, 1970 through May 12, 1977; $105 per share thereafter through May 12,
1980; $103 per share thereafter through May 12, 1985; and $101 per share
thereafter. A copy of the resolutions creating and authorizing the issuance
and sale of the $9.10 Series and the Company's Serial Preferred Stock is
attached hereto and incorporated fully herein by reference.
IN WITNESS WHEREOF, this statement is signed by the executive vice
president and secretary of the corporation this 7th day of May, 1970.
CAROLINA POWER & LIGHT COMPANY
By: W. Reid Thompson
Executive Vice President
ATTEST:
By: R. S. Mallison
Secretary
EXHIBIT D
STATEMENT OF CLASSIFICATION OF SHARES
OF
CAROLINA POWER & LIGHT COMPANY
The undersigned corporation hereby executes this Statement of
Classification of Shares pursuant to Section 55-42 of the North Carolina
General Statutes relating to the preferences, limitations and relative rights
of a series of a class of its shares:
1. The name of the corporation is CAROLINA POWER & LIGHT COMPANY.
2. The Certificate of Amendment to the Charter of the corporation
adopted at a regular meeting of the shareholders duly convened and held on
March 11, 1953, contained a resolution amending the Charter, which resolution,
in part, relates to the fixing of the preferences, limitations and relative
rights of the shares of Serial Preferred Stock of the corporation, and which
authorizes the Board of Directors to issue one or more series of Serial
Preferred Stock with such dividend rates, redemption prices and series
designations as may be fixed by resolution of the Board of Directors, which
Certificate of Amendment is on file in the Office of the Secretary of State of
North Carolina, and is set out below:
"The preferences, voting powers, restrictions and qualifications
of each of said classes of stock shall be as follows:
"The term `Serial Preferred Stock' as used herein means Preferred
Stock of any series of the 200,000 shares authorized by this Article
Fourth. The Board of Directors is authorized to issue at any time and
from time to time one or more series of Serial Preferred Stock with such
dividend rates and redemption prices and bearing such series
designations as may be fixed by the Board of Directors and stated and
expressed in the resolution or resolutions establishing the respective
series of such stock, the authority for which is hereby expressly vested
in the Board of Directors."
The number of authorized shares of Serial Preferred Stock was increased to
1,000,000 by Articles of Amendment to the Charter adopted at a regular meeting
of the shareholders in May 1969, which Articles of Amendment are on file in
the Office of the Secretary of State of North Carolina.
3. On January 6, 1971, the Board of Directors of the corporation duly
adopted resolutions authorizing the issuance and sale of 350,000 shares of a
new series of Serial Preferred Stock, without par value, designated as "Serial
Preferred Stock, $7.95 Series" bearing a dividend rate of $7.95 per share per
annum; and with the following redemption prices: for the period from January
14, 1971, to and including January 14, 1976, $115 per share; thereafter to and
including January 14, 1979, $110 per share; thereafter to and including
January 14, 1982, $107 per share; thereafter to and including January 14,
1985, $104 per share; and thereafter $101 per share. A copy of the
resolutions creating and authorizing the issuance and sale of the $7.95 Series
of the Company's Serial Preferred Stock is attached hereto and incorporated
fully herein by reference.
IN WITNESS WHEREOF, this statement is signed by a vice president and an
assistant secretary of the corporation this 13th day of January, 1971.
CAROLINA POWER & LIGHT COMPANY
By: Charles F. Rouse
Vice President
ATTEST:
By: J. L. Lancaster, Jr.
Assistant Secretary
(Corporate Seal)
EXHIBIT E
STATEMENT OF CLASSIFICATION SHARES
OF
CAROLINA POWER & LIGHT COMPANY
The undersigned corporation hereby executes this Statement of
Classification of Shares pursuant to Section 55-42 of the North Carolina
General Statutes relating to the preferences, limitations and relative rights
of a series of a class of its shares:
1. The name of the Corporation is CAROLINA POWER & LIGHT COMPANY.
2. The Certificate of Amendment to the Charter of the corporation
adopted at a regular meeting of the shareholders duly convened and held on May
19, 1971, contained a resolution amending the Charter, which resolution, in
part, relates to the fixing of the preferences, limitations and relative
rights of the shares of Serial Preferred Stock of the corporation, and which
authorizes the Board of Directors to issue one or more series of Serial
Preferred Stock with such dividend rates, redemption prices and series
designations as may be fixed by resolution of the Board of Directors, which
Certificate of Amendment is on file in the office of the Secretary of State of
North Carolina, and is set out below:
(1) The term "Serial Preferred Stock" as used herein means
Preferred Stock of any series of the 5,000,000 shares authorized by this
Article Fourth. The $5 Preferred Stock and the Serial Preferred Stock
are hereinafter sometimes referred to collectively as the "Preferred
Stocks." The Board of Directors is authorized to issue at any time and
from time to time one or more series of Serial Preferred Stock with such
dividends rates and redemption prices and bearing such series
designations as may be fixed by the Board of Directors and stated and
expressed in the resolution or resolutions establishing the respective
series of such stock, the authority for which is hereby expressly vested
in the Board of Directors.
3. On September 6, 1972, the Board of Directors of the corporation
duly adopted resolutions authorizing the issuance and sale of $500,000 shares
of a new series of Serial Preferred Stock, without par value, designated as
"Serial Preferred Stock, $7.72 Series" bearing a dividend rate of $7.72 per
share per annum; and with the following redemption prices: for the period from
September 14, 1972, to and including September 14, 1977, $115 per share;
thereafter to and including September 14, 1980, $110 per share; thereafter to
and including September 14, 1983, $107 per share; thereafter to and including
September 14, 1986, $104 per share; and thereafter $101 per share. A copy of
the resolutions creating and authorizing the issuance and sale of the $7.72
Series of the Company's Serial Preferred Stock is attached hereto and
incorporated fully herein by reference.
IN WITNESS WHEREOF, this statement is signed by a Senior Vice President
and the Secretary of the corporation this 7th day of September, 1972.
CAROLINA POWER & LIGHT COMPANY
By: Sherwood H. Smith, Jr.
Senior Vice President
Attest:
By: J. L. Lancaster, Jr.
Secretary
(Corporate Seal)
EXHIBIT F
STATEMENT OF CLASSIFICATION OF SHARES
OF
CAROLINA POWER & LIGHT COMPANY
The undersigned corporation hereby executes this Statement of
Classification of Shares pursuant to Section 55-42 of the North Carolina
General Statutes relating to the relative rights and preferences of a series
within a class of its shares:
1. The name of the corporation is CAROLINA POWER & LIGHT COMPANY.
2. The Certificate of Amendment to the Charter of the corporation
adopted at a special meeting of the shareholders duly convened and held on
October 23, 1973, contained a resolution amending the Charter, which
resolution, in part, relates to the fixing of the relative rights and
preferences of a series of Preferred Stock A of the corporation, and which
authorizes the Board of Directors to establish and issue one or more series of
Preferred Stock A which shall be of equal rank and identical in all respects
except that there may be variations between series in the following relative
rights and preferences: dividend rates, redemption prices, and the terms and
conditions on which shares may be redeemed, sinking fund provisions for the
redemption or purchase of shares, and terms and conditions on which shares may
be converted, if shares are issued with the privilege of conversion, and
bearing such series' designations, all as may be fixed by the Board of
Directors and stated or expressed in the resolution or resolutions
establishing the respective series of such stock, which Certificate of
Amendment is on file in the office of the Secretary of State of North
Carolina, and is set out in part below:
(1) (a) The Board of Directors is authorized to establish and
issue at any time and from time to time (i) one or more series of Serial
Preferred Stock with such dividend rates and redemption prices and
bearing such series designations as may be fixed by the Board of
Directors and stated and expressed in the resolution or resolutions
establishing the respective series of such stock, the authority for
which is hereby expressly vested in the Board of Directors and (ii) one
or more series of Preferred Stock A which shall be of equal rank and
identical in all respects except that there may be variations between
series in the following relative rights and preferences: dividend rates,
redemption prices and the terms and conditions on which shares may be
redeemed, sinking fund provisions for the redemption or purchase of
shares, and terms and conditions on which shares may be converted, if
shares are issued with the privilege of conversion, and bearing such
series' designations, all as may be fixed by the Board of Directors and
stated or expressed in the resolutions establishing the respective
series of such stock, the authority for which is hereby expressly vested
in the Board of Directors. So long as shares of any series of Preferred
Stock A shall be outstanding, no amendment or modification of the terms
thereof fixed by the resolution or resolutions of the Board of Directors
establishing any such series shall be made unless the holders of record
of not less than a majority of the number of shares of such series then
outstanding shall consent thereto in writing or by voting therefor in
person or by proxy at a meeting of such holders for such purpose.
3. On September 19, 1973, subject to the adoption by the shareholders
of the Amendment to the Charter of the corporation authorizing a class of
stock designated Preferred Stock A which Amendment was duly adopted by the
shareholders on October 23, 1973, the Board of Directors of the corporation
duly adopted resolutions authorizing the issuance and sale of 500,000 share of
Preferred Stock A, $7.45 Series, with a dividend rate of $7.45 per share per
annum; a mandatory sinking fund commencing in 1984 designed to redeem 20,000
shares annually at a redemption price of $100 per share; a noncumulative
option in the corporation to redeem not less than an additional 20,000 shares
annually at a redemption price of $100 per share up to a maximum of 120,000
shares in the aggregate without premium; and redeemable at any time at prices
ranging from $115 per share to $101 per share, subject to certain limitations
on refundings prior to September 2, 1980.
The above description is qualified by reference to the resolutions
creating and authorizing the issuance of the corporation's Preferred Stock A,
$7.45 Series, which are attached hereto and incorporated herein by reference.
IN WITNESS WHEREOF, this statement is signed by a Senior Vice President
and an Assistant Secretary of the corporation this 23rd day of October, 1973.
CAROLINA POWER & LIGHT COMPANY
By: Edward G. Lilly, Jr.
Senior Vice President
ATTEST:
By: Robert M. Williams
Assistant Secretary
(Corporate Seal)
EXHIBIT G
STATEMENT OF CLASSIFICATION OF SHARES
OF
CAROLINA POWER & LIGHT COMPANY
The undersigned corporation hereby executes this Statement of
Classification of Shares pursuant to Section 55-42 of the North Carolina
General Statutes relating to the relative rights and preferences of a series
within a class of its shares:
1. The name of the corporation is CAROLINA POWER & LIGHT COMPANY.
2. The Certificate of Amendment to the Charter of the corporation
adopted at a special meeting of the shareholders duly convened and held on
October 23, 1973, contained a resolution amending the Charter, which
resolution, in part, relates to the fixing of the relative rights and
preferences of a series of Serial Preferred Stock of the corporation, and
which authorizes the Board of Directors to establish and issue one or more
series of Serial Preferred Stock with such dividend rates and redemption
prices and bearing such series designations as may be fixed by the Board of
Directors and stated and expressed in the resolution or resolutions
establishing the respective series of such stock, which Certificate of
Amendment is on file in the office of the Secretary of State of North
Carolina, and is set out in part below:
(l) (a) The Board of Directors is authorized to establish and
issue at any time and from time to time (i) one or more series of Serial
Preferred Stock with such dividend rates and redemption prices and
bearing such series designations as may be fixed by the Board of
Directors and stated and expressed in the resolution or resolutions
establishing the respective series of such stock, the authority for
which is hereby expressly vested in the Board of Directors and (ii) one
or more series of Preferred Stock A which shall be of equal rank and
identical in all respects except that there may be variations between
series in the following relative rights and preferences: dividend
rates, redemption prices and the terms and conditions on which shares
may be redeemed, sinking fund provisions for the redemption or purchase
of shares, and terms and conditions on which shares may be converted, if
shares are issued with the privilege of conversion, and bearing such
series' designations, all as may be fixed by the Board of Directors and
stated or expressed in the resolutions establishing the respective
series of such stock, the authority for which is hereby expressly vested
in the Board of Directors. So long as shares of any series of Preferred
Stock A shall be outstanding, no amendment or modification of the terms
thereof fixed by the resolution or resolutions of the Board of Directors
establishing any such series shall be made unless the holders of record
of not less than a majority of the number of shares of such series then
outstanding shall consent thereto in writing or by voting therefor in
person or by proxy at a meeting of such holders for such purpose.
3. On February 20, 1974, the Board of Directors of the corporation
duly adopted resolutions authorizing the issuance and sale of 650,000 shares
of a new series of Serial Preferred Stock designated as "Serial Preferred
Stock, $8.48 Series" bearing a dividend rate of $8.48 per share per annum; and
with the following redemption prices: for the period from February 28, 1974,
to and including February 28, 1979, $115 per share; thereafter to and
including February 28, 1982, $108 per share; thereafter to and including
February 28, 1985, $105 per share; thereafter to and including February 28,
1988, $103 per share; and thereafter $101 per share. A copy of the
resolutions creating and authorizing the issuance and sale of the $8.48 Series
of the Company's Serial Preferred Stock is attached hereto and incorporated
fully herein by reference.
IN WITNESS WHEREOF, this statement is signed by a Senior Vice President
and the Secretary of the corporation this 22nd day of February, 1974.
CAROLINA POWER & LIGHT COMPANY
By: Sherwood H. Smith, Jr.
Senior Vice President
ATTEST:
By: J. L. Lancaster, Jr.
Secretary
(Corporate Seal)
EXHIBIT H
STATEMENT OF CLASSIFICATION OF SHARES
OF
CAROLINA POWER & LIGHT COMPANY
The undersigned Company hereby executes this Statement of Classification
of Shares pursuant to Section 55-42 of the North Carolina General Statutes
relating to the preferences, limitations and relative rights of a series of a
class of its shares:
1. The name of the Company is CAROLINA POWER & LIGHT COMPANY.
2. The Certificate of Amendment to the Charter of the Company adopted
at a regular meeting of the shareholders duly convened and held on May 19,
1971, contained a resolution amending the Charter, which resolution, in part,
relates to the fixing of the preferences, limitations and relative rights of
the shares of Preference Stock of the Company, and which authorizes the Board
of Directors to issue one or more series of Preference Stock with such
dividend rates, redemption prices and series designations as may be fixed by
resolution of the Board of Directors, which Certificate of Amendment is on
file in the office of the Secretary of State of North Carolina, and is set out
below:
PREFERENCE STOCK
(22) The Board of Directors is authorized to issue at any time and from
time to time one or more series of Preference Stock as hereinafter provided.
(23) To the extent that variations in the designations, preferences,
limitations and relative rights as between series of the Preference Stock are
not established, fixed and determined herein, authority is hereby expressly
vested in the Board of Directors to fix and determine the designations,
preferences, limitations and relative rights of the shares of any series of
such Preference Stock hereinafter established, including authority to fix any
one or more of the following:
(a) The distinctive designations of such series and the number
of shares which shall constitute such series;
(b) The rate of dividend;
(c) The right of redemption, if any, and the price at and the
terms and conditions on which the shares may be redeemed;
(d) The amount payable upon shares in event of involuntary
liquidation;
(e) The amount payable upon shares in event of voluntary
liquidation;
(f) Sinking fund provisions, if any, for the redemption or
purchase of shares; and
(g) The terms and conditions on which shares may be converted,
if the shares of any series are issued with the privilege of
conversion.
3. On March 12, 1975, the Executive Committee of the Board of Directors
of the Company duly adopted resolutions authorizing the issuance and sale of
2,000,000 shares of the A Series of Preference Stock, without par value,
designated as "$2.675 Preference Stock, Series A" bearing a dividend rate of
$2.675 per share per annum; and with the following redemption prices: For the
period from March 20, 1975, to and including March 31, 1980, $27.68 per share;
thereafter to and including March 31, 1985, $26.50 per share; thereafter to
and including March 31, 1990, $25.75 per share; and thereafter $25.25 per
share. A copy of the resolutions creating and authorizing the issuance and
sale of the A Series of the Company's Preference Stock is attached hereto and
incorporated fully herein by reference.
IN WITNESS WHEREOF, this statement is signed by a Vice President and the
Secretary of the Company this 13th day of March, 1975.
CAROLINA POWER & LIGHT COMPANY
By: William E. Graham, Jr.
Vice President
ATTEST:
By: J. L. Lancaster, Jr.
Secretary
(Corporate Seal)
EXHIBIT I
STATEMENT OF CLASSIFICATIONS OF SHARES
OF
CAROLINA POWER & LIGHT COMPANY
The undersigned corporation hereby executes this Statement of
Classification of Shares pursuant to Section 55-42 of the North Carolina
General Statutes relating to the relative rights and preferences of a series
within a class of its shares:
1. The name of the corporation is CAROLINA POWER & LIGHT COMPANY.
2. The Certificate of Amendment to the Charter of the corporation
adopted at a special meeting of the shareholders duly convened and held on
October 23, 1973, contained a resolution amending the Charter, which
resolution, in part, relates to the fixing of the relative rights and
preferences of a series of Preferred Stock A of the corporation, and which
authorizes the Board of Directors to establish and issue one or more series of
Preferred Stock A which shall be of equal rank and identical in all respects
except that there may be variations between series in the following relative
rights and preferences: dividend rates, redemption prices, and the terms and
conditions on which shares may be redeemed, sinking fund provisions for the
redemption or purchase of shares, and terms and conditions on which shares may
be converted, if shares are issued with the privilege of conversion, and
bearing such series' designations, all as may be fixed by the Board of
Directors and stated or expressed in the resolution or resolutions
establishing the respective of such stock, which Certificate of Amendment is
on file in the office of the Secretary of State of North Carolina, and is set
out in part below:
(1) (a) The Board of Directors is authorized to establish and
issue at any time and from time to time (i) one or more series of Serial
Preferred Stock with such dividend rates and redemption prices and
bearing such series designations as may be fixed by the Board of
Directors and stated and expressed in the resolution or resolutions
establishing the respective series of such stock, the authority for
which is hereby expressly vested in the Board of Directors and (ii) one
or more series of Preferred Stock A which shall be of equal rank and
identical in all respects except that there may be variations between
series in the following relative rights and preferences: dividend
rates, redemption prices and the terms and conditions on which shares
may be redeemed, sinking fund provisions for the redemption or purchase
of shares, and terms and conditions on which shares may be converted, if
shares are issued with the privilege of conversion, and bearing such
series' designations, all as may be fixed by the Board of Directors and
stated or expressed in the resolutions establishing the respective
series of such stock, the authority for which is hereby expressly vested
in the Board of Directors. So long as shares of any series of Preferred
Stock A shall be outstanding, no amendment or modification of the terms
thereof fixed by the resolution or resolutions of the Board of Directors
establishing any such series shall be made unless the holders of record
of not less than a majority of the number of shares of such series then
outstanding shall consent thereto in writing or by voting therefor in
person or by proxy at a meeting of such holders for such purpose.
3. On September 6, 1979 the Executive Committee of the Board of
Directors of the corporation duly adopted resolutions authorizing the issuance
and sale of 500,000 shares of Preferred Stock A, $8.75 Series, with a dividend
rate of $8.75 per share per annum; a mandatory sinking fund commencing in 1985
designed to redeem 20,000 shares annually at a redemption price of $100 per
share until 1999, after which 40,000 shares per year shall be redeemed; a
noncumulative option in the corporation to redeem not greater than an
additional 20,000 shares annually (40,000 shares after 1999) at a redemption
price of $100 per share which shall be credited against the sinking fund
redemption requirement in reverse chronological order; and which are
redeemable at any time at prices ranging from $108.75 per share to $100.00 per
share, subject to certain limitations on refinancings prior to September 1,
1989 and other specified means of redemption.
The above description is qualified by reference to the resolutions
creating and authorizing the issuance of the corporation's Preferred Stock A,
$8.75 Series, which are attached hereto and incorporated herein by reference.
IN WITNESS WHEREOF, this statement is signed by a Senior Vice President
and an Assistant Secretary of the corporation this 7th day of September, 1979.
CAROLINA POWER & LIGHT COMPANY
By: William E. Graham, Jr.
Senior Vice President
ATTEST:
By: Robert M. Williams
Assistant Secretary
(Corporate Seal)
EXHIBIT J
STATEMENT OF CLASSIFICATION OF SHARES
OF
CAROLINA POWER & LIGHT COMPANY
The undersigned corporation hereby executes this Statement of
Classification of Shares pursuant to Section 55-42 of the North Carolina
General Statutes relating to the relative rights and preferences of a series
within a class of its shares:
1. The name of the corporation is CAROLINA POWER & LIGHT COMPANY.
2. The Certificate of Amendment to the Charter of the corporation
adopted at a special meeting of the shareholders duly convened and held on
October 23, 1973, contained a resolution amending the Charter, which
resolution, in part, relates to the fixing of the relative rights and
preferences of a series of Preferred Stock A of the corporation, and which
authorizes the Board of Directors to establish and issue one or more series of
Preferred Stock A which shall be of equal rank and identical in all respects
except that there may be variations between series in the following relative
rights and preferences: dividend rates, redemption prices, and the terms and
conditions on which shares may be redeemed, sinking fund provisions for the
redemption or purchase of shares, and terms and conditions on which shares may
be converted, if shares are issued with the privilege of conversion, and
bearing such series' designations, all as may be fixed by the Board of
Directors and stated or expressed in the resolution or resolutions
establishing the respective series of such stock, which Certificate of
Amendment is on file in the office of the Secretary of State of North
Carolina, and is set out in part below:
(1) (a) The Board of Directors is authorized to establish and
issue at any time and from time to time (i) one or more series of Serial
Preferred Stock with such dividend rates and redemption prices and
bearing such series designations as may be fixed by the Board of
Directors and stated and expressed in the resolution or resolutions
establishing the respective series of such stock, the authority for
which is hereby expressly vested in the Board of Directors and (ii) one
or more series of Preferred Stock A which shall be of equal rank and
identical in all respects except that there may be variations between
series in the following relative rights and preferences: dividend
rates, redemption prices and the terms and conditions on which shares
may be redeemed, sinking fund provisions for the redemption or purchase
of shares, and terms and conditions on which shares may be converted, if
shares are issued with the privilege of conversion, and bearing such
series' designations, all as may be fixed by the Board of Directors and
stated or expressed in the resolutions establishing the respective
series of such stock, the authority for which is hereby expressly vested
in the Board of Directors. So long as shares of any series of Preferred
Stock A shall be outstanding, no amendment or modification of the terms
thereof fixed by the resolution or resolutions of the Board of Directors
establishing any such series shall be made unless the holders of record
of not less than a majority of the number of shares of such series then
outstanding shall consent thereto in writing or by voting therefor in
person or by proxy at a meeting of such holders for such purpose.
3. On February 20, 1980 the Executive Committee of the Board of
Directors of the corporation duly adopted resolutions authorizing the issuance
and sale of 180,000 shares of Preferred Stock A, $9.25 Series, with a dividend
rate of $9.25 per share per annum; which are redeemable at any time at prices
ranging from $109.00 per share to $100.00 per share, subject to certain
limitations on refinancings prior to March 1, 1985 and other specified means
of redemption.
The above description is qualified by reference to the resolutions
creating and authorizing the issuance of the corporation's Preferred Stock A,
$9.25 Series, which are attached hereto and incorporated herein by reference.
IN WITNESS WHEREOF, this statement is signed by a Senior Vice President
and an Assistant Secretary of the corporation this 20th day of February, 1980.
CAROLINA POWER & LIGHT COMPANY
By: William E. Graham, Jr.
Senior Vice President
ATTEST:
By: Robert M. Williams
Assistant Secretary
(Corporate Seal)
ARTICLES OF AMENDMENT OF
CAROLINA POWER & LIGHT COMPANY
The undersigned corporation hereby executes these Articles of Amendment
for the purpose of amending its charter:
1. The name of the corporation is Carolina Power & Light Company.
2. The following amendment to the Eleventh Article of the Restated
Charter of the corporation was adopted by its shareholders of the 10th day of
May, 1989, in the manner prescribed by law:
To the fullest extent permitted by the North Carolina
Business Corporation Act as it exists or may hereafter
be amended, a director of the corporation shall not be
liable to the corporation or any of its shareholders
for monetary damages for breach of duty as a director.
3. The number of shares of the corporation outstanding at the time of
such adoption was 84,210,520, and the number of shares entitled to vote
thereon was 82,755,520. All classes entitled to vote on the amendment voted
as one class.
4. The number of shares voted for such amendment was 64,941,613, and
the number of shares voted against such amendment was 3,311,105.
5. The amendment herein effected does not give rise to dissenter's
rights to payment for the reason that the only effect of such amendment is to
eliminate directors' liability for monetary damages for certain breaches of
their duties as directors pursuant to N.C.G.S. Section 55-7(11).
IN WITNESS WHEREOF, these articles of amendment are signed by the Senior
Vice President and Assistant Secretary of the corporation this 19th day of
May, 1989.
CAROLINA POWER & LIGHT COMPANY
By Charles D. Barham, Jr.
SEAL Senior Vice President
By Robert M. Williams
Assistant Secretary
State of North Carolina )
County of Wake )
I, Fay P. Frederick, a notary public, hereby certify that on this 19th
day of May, 1989, personally appeared before me Charles D. Barham, Jr. and
Robert M. Williams, each of whom being by me first duly sworn, declared that
he signed the foregoing document in the capacity indicated, that he was
authorized so to sign, and that the statements therein contained are true.
By: Fay P. Frederick
Notary Public
My commission expires: March 11, 1991
ARTICLES OF AMENDMENT
OF
CAROLINA POWER & LIGHT COMPANY
The undersigned corporation hereby submits these Articles of Amendment
for the purpose of amending its Restated Charter.
1. The name of the corporation is CAROLINA POWER & LIGHT COMPANY.
2. The Restated Charter of the corporation is hereby amended to
increase the authorized number of shares of Common Stock from 100,000,000 to
200,000,000 by amending the first paragraph of Article Fourth as follows:
a. The figure "135,300,000" there appearing
shall be deleted in its entirety and in lieu and
substitution thereof the figure "235,300,000"
shall be added.
b. The figure "100,000,000" there appearing
shall be deleted in its entirety and in lieu and
substitution thereof the figure "200,000,000"
shall be added.
As amended, the full text of the first paragraph of Article Fourth of
the corporation's Restated Charter is as follows:
FOURTH: The total number of the authorized shares of the
Company is 235,300,000 shares divided into 300,000 shares of $5
Preferred Stock (hereinafter called "$5 Preferred Stock"),
20,000,000 shares of Serial Preferred Stock (hereinafter called
"Serial Preferred Stock"), 5,000,000 shares of Preferred Stock A
(hereinafter called "Preferred Stock A"), 10,000,000 shares of
Preference Stock (hereinafter called "Preference Stock"), and
200,000,000 shares of Common Stock, all without nominal or par
value.
3. Shareholder approval of the foregoing Amendment was obtained on
the 13th day of May, 1992, as required by the North Carolina Business
Corporation Act.
This 27th day of May, 1992.
CAROLINA POWER & LIGHT COMPANY
By: Sherwood H. Smith, Jr.
Title: Chairman/President and Chief Executive Officer
ARTICLES OF AMENDMENT
OF
CAROLINA POWER & LIGHT COMPANY
The undersigned corporation hereby submits these Articles of Amendment for
the purpose of amending its Restated Charter.
1. The name of the corporation is CAROLINA POWER & LIGHT COMPANY.
2. The Restated Charter of the corporation is hereby amended to
establish a variable range for the size of the Board of Directors by amending
Article SIXTH of the Restated Charter.
As amended, the full text of Article SIXTH of the corporation's
Restated Charter is as follows:
SIXTH: The number of directors constituting the Board
of Directors shall be determined in accordance with the
Company's By-Laws. At least fifty percent of the number
of directors so determined shall constitute a quorum.
3. Shareholder approval of the foregoing Amendment was obtained on the
10th day of May, 1995, as required by the North Carolina Business Corporation
Act.
This 10th day of May, 1995.
CAROLINA POWER & LIGHT COMPANY
By: Sherwood H. Smith, Jr.
Title: Chairman and Chief Executive Officer
EXHIBIT 3(ii)
B Y - L A W S
of
CAROLINA POWER & LIGHT COMPANY
Raleigh, North Carolina
(As Amended May 10, 1995)
Meetings of Stockholders
________________________
Section 1. The annual meeting of the stockholders of the Company shall be
held at the principal office of the Company, on the second Wednesday of May in
each year, if not a legal holiday, and if a legal holiday, then on the next day
not a legal holiday, at ten o'clock A.M., or at such other date, or hour, or at
such other place within or without the State of North Carolina as stated in the
notice of the meeting as the Board of Directors may determine.
Section 2. Special meetings of the stockholders of the Company may be held
upon call by a majority of the Board of Directors or of the Executive Committee,
or by the Chairman of the Board, or by the President of the Company, at the
principal office of the Company or at such other place within or without the
State of North Carolina, and at such time, as may be stated in the call and
notice.
Section 3. Written notice of the time and place of every meeting of
stockholders may be given, and shall be deemed to have been duly given, by
mailing the same at least ten, but not more than sixty, days prior to the
meeting, to each stockholder of record, entitled to vote at such meeting, and
addressed to him at his address as it appears on the records of the Company,
with postage thereon prepaid. Notice may also be given by any other lawful
means.
Section 4. In accordance with Section 55-7-20 of the General Statutes of
North Carolina, the Company, or an officer having charge of the record of
stockholders of the Company, shall prepare a list of stockholders which shall be
available for inspection by stockholders, or their agents or attorneys.
Section 5. The holders of a majority of the stock of the Company having
voting powers must be present in person or represented by proxy at each meeting
of the stockholders to constitute a quorum; absent such quorum, the meeting may
be adjourned by a majority of shares voting on a motion to adjourn. If such
adjournment is for less than thirty days, notice other than announcement at the
meeting need not be given. At any adjourned meeting at which a quorum shall be
present or represented, any business may be transacted which might have been
transacted at the original meeting.
Section 6. When a quorum is present at any meeting, the vote of the
holders of a majority of the outstanding stock having voting power present in
person or represented by proxy shall decide any question brought before such
meeting, unless the question is one upon which by express provision of any
applicable statute or of the Charter a different vote is required, in which case
such express provision shall govern and control the decision of such question.
Section 7. The Board of Directors in advance of any meeting of
stockholders may appoint two voting inspectors to act at any such meeting or
adjournment thereof. If they fail to make such appointment, or if their
appointees or any of them fail to appear at the meeting of stockholders, the
chairman of the meeting may appoint such inspectors or any inspector to act at
that meeting.
Section 8. Meetings of the stockholders shall be presided over by the
Chairman of the Board of Directors, or, if he is not present, the President, or,
if the President is not present, a Vice President, or if neither of said
officers is present, by a chairman pro tem to be elected at the meeting. The
Secretary of the Company shall act as secretary of such meetings, if present,
but if not present, some person shall be appointed by the presiding officer to
act during the meeting.
Section 9. Each holder of Preferred Stock and/or Common Stock shall at
every meeting of the stockholders be entitled to one vote in person or by proxy
for each share of such stock held by such stockholder. Except where the transfer
books of the Company have been closed or a date has been fixed as a record date
for the determination of its stockholders entitled to vote, no share of stock
shall be voted at any election for directors which has been transferred on the
books of the Company within twenty days next preceding such election of
directors.
Directors and Meetings of Directors
___________________________________
Section 10. (a) The number of directors of the Company shall not be less
than eleven (11) nor more than fifteen (15). The authorized number of directors,
within the limits above specified, shall be determined by the affirmative vote
of a majority of the whole board given at any regular or special meeting of the
Board of Directors, provided that, the number of directors shall not be reduced
to a number less than the number of directors then in office unless such
reduction shall become effective only at and after the next ensuing meeting of
the shareholders for the election of directors. This subsection (a) was adopted
by the stockholders of the Company.
(b) The directors shall appoint from among their number a Chairman, who
shall serve at the pleasure of the Board. Members of the Board of Directors of
the Company who are full-time employees of the Company shall retire from the
Board upon attaining the age of 65 years; provided, however, that the Chairman
and Chief Executive Officer of the Company shall be eligible to continue as a
member of the Board after attaining the age of 65 years and will be considered
a Director who is not employed full-time by the Company. Those persons who are
not employed full-time by the Company shall not be eligible for election as a
Director in any calendar year (or subsequent year) in which he or she has
reached or will reach the age of 71 years. Any Director who reaches the age of
71 during a term of office shall resign as of the first day of the month so
following unless otherwise determined by the Board.
(c) The election of directors shall be held at the annual meeting of
stockholders. The directors, other than those who may be elected under
circumstances specified in the Company's Restated Charter, as it may be amended,
by the holders of any class of stock having a preference over the Common Stock
as to dividends or in liquidation, shall be classified into three classes, as
nearly equal in number as possible. The initial terms of directors first
elected or re-elected by the stockholders on the date this amendment to the By-
Laws is adopted shall be for the following terms of office:
Class I: One year
Class II: Two years
Class III: Three years
and until their successors shall be elected and shall qualify. Upon the
expiration of the initial term specified for each class of directors their
successors shall be elected for three-year terms or until such time as their
successors shall be elected and qualified. In the event of any increase or
decrease in the number of directors, the additional or eliminated directorships,
shall be classified or chosen so that all classes of directors shall remain or
become equal in number, as nearly as possible. This subsection (c) was adopted
by the stockholders of the Company.
Section 11. In case of any vacancy in the number of directors through
death, resignation, disqualification, increase in the number of directors or
other cause, the remaining directors present at the meeting, by affirmative vote
of a majority thereof, though less than a quorum, may elect a successor to hold
office until the next shareholders' meeting at which directors are elected and
until the election of his successor.
Section 12. Regular meetings of the Board of Directors shall be held at
times fixed by resolution of the Board,and special meetings may be held upon the
written call of the Executive Committee, or by the Chairman of the Board, or by
the President or by any two directors; and the Secretary or officer performing
his duties shall give reasonable notice of all meetings of directors; provided,
that a meeting may be held without notice immediately after the annual election,
and notice need not be given of regular meetings held at times fixed by
resolution of the Board. Meetings may be held at any time without notice if all
the directors are present, or if those not present waive notice either before or
after the meeting. All regular and special meetings shall be held at the
principal offices of the Company, provided that the Board, from time to time,
may order that any meeting be held elsewhere within or without the State of
North Carolina. A majority of the whole Board of Directors shall constitute a
quorum and the act of a majority of the directors present at a meeting at which
a quorum is present shall be the act of the Board of Directors, unless a greater
proportion is required by the Charter.
Section 13. The business and affairs of the Company shall be managed by
its Board of Directors, which may exercise all such powers of the Company and do
all such lawful acts and things which are not by law or by the Charter directed
or required to be exercised or done by the stockholders; provided, however, that
the officers of the Company shall, without prior action of the Board of
Directors, perform all acts and things incidental to the usual and ordinary
course of the business in which the Company is engaged as hereinafter provided
by the By-Laws or as may hereafter be delegated by the Board of Directors. A
majority of the Board of Directors may create one or more Committees and appoint
other members of the Board of Directors to serve on such Committees. Each such
Committee shall have two or more members, who serve at the pleasure of the Board
of Directors. Any such Committee may exercise authority over any matters except
those matters described in Section 55-8-25(e) of the General Statutes of North
Carolina.
Section 14. A majority of the whole Board of Directors, present at any
meeting held after their election in each year, may appoint an Executive
Committee, to consist of three or more directors, which Committee shall have and
may exercise, during the intervals between meetings of the Board, by a majority
vote of those present at a meeting, all the powers vested in the Board, except
the following matters as more fully described in Section 55-8-25(e) of the
General Statutes of North Carolina:
- Authorize distributions;
- Approve or propose to shareholders action that is by law required
to be approved by the shareholders;
- Fill vacancies on the Board of Directors or on any of its
Committees;
- Amend the Company's Articles of Incorporation pursuant to N.C.G.S.
Section 55-10-102;
- Adopt, amend or repeal the Company's By-Laws;
- Approve a plan of merger not requiring shareholder approval;
- Authorize or approve reacquisition of shares, except according to
a formula or method prescribed by the Board of Directors; or
- Authorize or approve the issuance or sale or contract for sale of
shares, or determine the designation and relative rights,
preferences, and limitations of a class or series of shares.
A majority of the whole Board of Directors present at any meeting shall have the
power at any time to change the membership of such Committee and to fill
vacancies in it. The Executive Committee may make rules for the conduct of its
business. A majority of the members of said Committee shall constitute a quorum.
The Chairman of the Executive Committee shall be appointed by the Board of
Directors from the membership of the Executive Committee.
Notices
_______
Section 15. Notices to directors or stockholders shall be in writing and
given personally or by mail to the directors and by mail to the stockholders at
their addresses appearing on the books of the Company; provided, however, that
no notice need be given any stockholder or director whose address is outside of
the United States. Notice by mail shall be deemed to be given at the time when
the same shall be mailed. Notice to directors may also be given verbally, or by
telegram, or cable, and any such notice shall be deemed to be given when
delivered to and accepted for transmittal by an office of the transmitting
company.
Section 16. Whenever any notice is required to be given under the
provisions of applicable statutes or of the Charter or of these By-Laws, a
waiver thereof in writing, signed by the person or persons entitled to said
notice whether before or after the time stated therein, shall be deemed
equivalent to the giving of such notice in apt time.
Officers, Their Authority, and Their Terms of Office
____________________________________________________
Section 17. The Board of Directors shall elect the officers of the
Company, who shall consist of a Chairman, a President, one or more Senior
Executive Vice Presidents and Executive Vice Presidents, two or more Senior
Vice Presidents, three or more Vice Presidents, a Secretary, a Treasurer, a
Controller and such other officers or assistant officers and agents as may be
appointed by the Board of Directors. From time to time the Board of Directors
may also elect a Vice Chairman who shall have such duties as described herein
and as may from time to time be directed. Any two offices may be held by the
same person but, no officer may act in more than one capacity where action of
two or more officers is required. The Chairman and Vice Chairman, if any, of the
Board of Directors shall be chosen from among the Directors, but the other
officers need not be Directors of the Company. The Officers shall be chosen
annually by the Board of Directors at its first meeting held after the Annual
Meeting of Stockholders, or as soon thereafter as may be practical, and shall
serve for the period specified or until a successor is chosen.
Section 18. The Chairman shall be the Chief Executive Officer. In the
event the Chairman is unavailable at the time for needed action, or in other
circumstances as directed by the Chairman,then the Vice Chairman, if any, or the
President if there is no Vice Chairman, shall be the next officer in line of
authority to perform the duties of Chief Executive Officer. If the Chairman, the
Vice Chairman and the President should be unavailable at the time for needed
action, or in other circumstances as directed by the Chief Executive Officer,
then the next officer in line of authority to perform the duties of the Chief
Executive Officer shall be a Senior Executive Vice President or Executive Vice
President as designated by the Chief Executive Officer.
Section 19. Any officer may be reassigned duties by appropriate members
of Senior Management at any time. Any officer may be removed from office at any
time by the Board of Directors, without prejudice to the rights of the officer
removed under an employment agreement in writing previously duly authorized by
the Board of Directors or an Executive Committee of the Board of Directors. Any
officer may resign at any time by giving written notice to the Board of
Directors, the President or any other officer of the Company. Such resignation
shall take effect at the time specified therein, and, unless otherwise specified
therein, the acceptance of such resignation shall not be necessary to make it
effective. The Board of Directors or an Executive Committee of the Board of
Directors may fill any vacancy in any office occurring by virtue of the
incumbent's death, resignation, removal or otherwise at any duly convened
meeting of the Board.
Section 20. The Board of Directors or the Chief Executive Officer of the
Company may require the Treasurer and any other officer, employee or agent of
the Company to give bond, in such sum and with such surety or sureties as either
shall determine, for the faithful discharge of their duties.
Section 21. Unless otherwise provided by the Board of Directors, the
Company's Chief Executive Officer is vested with full power, authority, and the
duty, to perform in person, and by delegation of authority to subordinate
officers and employees of the Company, all acts and things deemed by him to be
reasonably necessary or desirable to direct, handle, and manage, and in general
carry on the Company's business transactions authorized by its Charter, in
respect to all matters except those which by law must be performed by the
Directors, including but not limited to the following: (a) constructing and
contracting for the construction of generating plants authorized by the
Directors;(b) operating and maintaining generating plants and appurtenant works;
(c) constructing, maintaining, and operating substations, lines and all other
facilities, appurtenant to the transmission, distribution and delivery of
electricity; (d) acquiring by direct purchase, gift, exchange, or by
condemnation, all rights of way, easements, lands, and estates in lands, flowage
and water rights; (e) acquiring, maintaining and disposing of tools, machinery,
appliances, materials, vehicles, and other appurtenant facilities;(f) employing,
and fixing compensation of, Company personnel (except that the compensation of
the Chief Executive Officer and the other Company employees who are members of
the Board shall be fixed by the Board of Directors) in compliance with any
procedures established by the Board; (g) borrowing money from time to time for
terms not exceeding three years, and in connection therewith pledging the credit
of the Company and executing unsecured loan agreements, promissory notes, and
other desirable instruments evidencing obligations to the lender; (h) fixing the
rates and conditions of service and dealing with regulatory bodies in respect
thereto, and promoting the use of electricity by means of sales representatives,
advertising and otherwise; (i) collecting and keeping accounts of all monies due
the Company and making and preserving records of the Company's properties and
accounts and fiscal affairs; and (j) possessing, preserving, and protecting all
property, assets, and interests of the Company and instituting, prosecuting,
intervening in, and defending actions and proceedings in any court or before any
administrative agency or tribunal affecting the Company's interests and welfare.
Certificates of Stock
_____________________
Section 22. Every holder of stock in the Company shall be entitled to have
a certificate or certificates certifying the number of fully paid shares owned
by him in the Company which shall be in form consistent with law and with the
Charter of the Company and as shall be approved by the Board of Directors. The
stock certificates shall be signed by: 1) either the Chairman of the Board of
Directors or the President, and 2) either the Secretary or Treasurer. Such
signatures may be facsimile or other similar method.
Section 23. All transfers of stock of the Company shall be made upon its
books by authority of the holder of the shares or of his legal representative,
and before a new certificate is issued the old certificate shall be surrendered
for cancellation, provided that in case any certificate is lost, stolen or
destroyed, a new certificate therefor may be issued pursuant to the provisions
of Section 24 hereof.
Section 24. No certificate of shares of stock of the Company shall be
issued in place of any certificate alleged to have been lost or stolen or
destroyed, except upon the approval of the Board of Directors who may require
delivery to the Company of a bond in such sum as it may direct and subject to
its approval as indemnity against any claim in respect to such lost or stolen or
destroyed certificate; provided that the Board of Directors may delegate to the
Company's Transfer Agent and Registrar authority to issue and register,
respectively, from time to time without further action or approval of the Board
of Directors, new certificates of stock to replace certificates reported lost,
stolen or destroyed upon receipt of an affidavit of loss and bond of indemnity
in form and amount and with corporate surety satisfactory to them in each
instance protecting the Company and them against loss. Such legal evidence of
such loss or theft or destruction shall be furnished to the Board of Directors
as may be required by them.
Section 25. The Board of Directors shall have power and authority to make
all such rules and regulations as it may deem expedient concerning the issue,
transfer, conversion and registration of certificates for shares of the capital
stock of the Company, not inconsistent with the laws of North Carolina, the
Charter of the Company and these By-Laws. The Board of Directors is authorized
to appoint one or more transfer agents and registrars for the capital stock of
the Company.
Section 26. The Board of Directors shall have power to close the stock
transfer books or in lieu thereof to fix record dates as authorized by law.
General
_______
Section 27. Subject to the provisions of the applicable statutes and the
Charter of the Company, dividends, either cash or stock, upon the capital stock
of the Company may be declared by the Board of Directors at any meeting thereof.
Section 28. Deeds, bonds, notes, mortgages and contracts of the Company
may be executed on behalf of the Company by the President, or a Vice President,
or any one of such other persons as shall from time to time be authorized by the
Board of Directors, and when necessary or appropriate may be attested or
countersigned by the Secretary or an Assistant Secretary, or the Treasurer or an
Assistant Treasurer. The corporate seal of the Company may be affixed to deeds,
bonds, notes, mortgages, contracts or stock certificates by an appropriate
officer of the Company by impression thereon, or, by order of an appropriate
officer of the Company, a facsimile of said seal may be affixed thereto by
engraving, printing, lithograph or other method.
Section 29. The monies of the Company shall be deposited in the name of
the Company in such bank or banks or trust company or trust companies as the
Treasurer, with approval of the Chief Executive Officer, shall from time to time
select, and shall be drawn out only by checks or other orders signed by persons
designated by resolution by the Board of Directors.
Section 30. As and when used in any of the foregoing By-Laws the words
"stockholder" and "stockholders" shall be deemed and held to be synonymous with
the words "shareholder" and "shareholders", and the word "stock" shall be deemed
and held to be synonymous with the words "share" or "shares", respectively, as
used in Chapter 55 of the General Statutes of North Carolina.
Amendment of By-Laws
____________________
Section 31. The Board of Directors shall have power from time to time to
adopt, amend, alter, add to, and repeal By-Laws for the Company by affirmative
vote of a majority of the directors then holding office, provided, however, that
the By-Laws may not be amended by the Board of Directors to require more than a
majority of the voting shares for a quorum at a stockholder's meeting, or more
than a majority vote at such meeting, except where higher percentages are
required by law. Any By-Laws so made or any provisions thereof may be altered
or repealed by vote of the holders of a majority of the total number of shares
of the Company then issued and outstanding and entitled to vote thereon at any
annual stockholders' meeting. Additionally, any By-Law adopted, amended or
repealed by the stockholders may not be readopted, amended or repealed by the
Board of Directors unless the Charter or a By-Law adopted by the stockholders
authorizes the Board of Directors to adopt, amend or repeal that particular By-
Law or the By-Laws generally.
Indemnity of Officers and Directors
___________________________________
Section 32. (a) The Company shall reimburse or indemnify any past, present
or future officer or director of the Company for and against such liabilities
and expenses as are authorized by (1) a resolution adopted by the Company's
stockholders at a special meeting held on December 31, 1943, which is made a
part hereof as though incorporated herein, or (2) by Sections 55-8-54, 55-8-55,
55-8-56 and 55-8-57 of the General Statutes of North Carolina. Persons serving
as officers or directors of the Company or serving in any such capacity at the
request of the Company in any other corporation, partnership, joint venture,
trust or other enterprise shall be provided reimbursement and indemnification by
the Company to the maximum extent allowed hereunder or under applicable law,
including without limitation Sections 55-8-54, 55-8-55, 55-8-56 and 55-8-57 of
the General Statutes of North Carolina.
(b) In addition to the reimbursement and indemnification provisions set
forth above, any person who at any time serves or has served (1) as an officer
or director of the Company, or (2) at the request of the Company as an officer
of director (or in any position of similar authority, by whatever title known)
of any other corporation, partnership, joint venture, trust or other enterprise,
or(3) as an individual trustee or administrator under any employee benefit plan,
shall have a right to be indemnified by the Company to the fullest extent
permitted by law against (i) all reasonable expenses, including attorney's fees,
actually and necessarily incurred by him in connection with any pending,
threatened or completed action, suit or proceeding, whether civil, criminal,
administrative or investigative, and whether or not brought by the Company or
on behalf of the Company in a derivative action, seeking to hold him liable by
reason of or arising out of his status as such or his activities in any of the
foregoing capacities, and (ii) payments made by him in satisfaction of any
judgement, money decree, fine, penalty or settlement for which he may have
become liable in any such action, suit or proceeding;provided, however, that the
Company shall not indemnify any person against liability or litigation expense
he may incur on account of his activities which were at the time taken known or
believed by him to be clearly in conflict with the best interests of the
Company.
(c) The Board of Directors shall take all action as may be necessary
or appropriate to authorize the Company to pay all amounts required under these
Sections 32(a),(b) and (c) of the By-Laws including, without limitation and to
the extent deemed to be appropriate, necessary, or required by law (1) making a
good faith evaluation of the manner in which the claimant for indemnity acted
and of the reasonable amount of indemnity due such individual, or (2) making
advances of costs and expenses, or (3) giving notice to, or obtaining approval
by, the shareholders of the Company.
(d) Any person who serves or has served in any of the aforesaid
capacities for or on behalf of the Company shall be deemed to be doing or to
have done so in reliance upon, and as consideration for, the rights of
reimbursement and indemnification provided for herein. Such rights of
reimbursement and indemnification shall inure to the benefit of the legal
representatives of such individuals, shall include amounts paid in settlement
and shall not be exclusive of any other rights to which such individuals shall
be entitled apart from the provisions of this Section.
(e) The Company may, in its sole discretion, wholly or partially
indemnify and advance expenses to any employee or agent of the Company to the
same extent as provided herein for officers and directors.
