As filed with the Securities and Exchange Commission on October 26, 1999.
REGISTRATION STATEMENT NO. 333-_____
================================================================================
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
--------------------
FORM S-8
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
--------------------
CAROLINA POWER & LIGHT COMPANY
(Exact name of Registrant as specified in its Charter)
411 Fayetteville Street
Raleigh, North Carolina 27601-1748
(919) 546-6111
(Address of principal executive office, including zip code)
North Carolina 56-0165465
(State or other jurisdiction of (I.R.S. Employer Identification Number)
incorporation or organization)
CAROLINA POWER & LIGHT COMPANY
MANAGEMENT DEFERRED COMPENSATION PLAN
(Full title of the Plan)
----------------------
Mr. Robert B. McGehee
Executive Vice President and General Counsel
Carolina Power & Light Company
411 Fayetteville Street
Raleigh, North Carolina 27601-1748
(919) 546-6111
(Name, address, including zip code, and telephone number including area code,
of agent for service)
Copy to:
Timothy S. Goettel, Esq.
Hunton & Williams
421 Fayetteville Street Mall
Raleigh, North Carolina 27601
(919) 899-3094
--------------------
CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
================================================================================================================
<S> <C> <C> <C> <C> <C> <C>
Proposed maximum Proposed maximum
Title of securities Amount to be offering price aggregate Amount of
to be registered registered per obligations offering price(2) registration fee
- ----------------------------------------------------------------------------------------------------------------
Deferred Compensation $ 3,940,000 100% $ 3,940,000 $ 1,095.32
Obligations (1)
================================================================================================================
</TABLE>
(1) The Deferred Compensation Obligations are unsecured obligations of
Carolina Power & Light Company to pay deferred compensation in the future in
accordance with the terms of the Carolina Power & Light Company Management
Deferred Compensation Plan.
(2) Estimated solely for the purpose of computing the registration fee.
================================================================================
<PAGE>
PART I
INFORMATION REQUIRED IN THE SECTION 10(A) PROSPECTUS
The document(s) containing the information specified in Part I of Form
S-8 will be sent or given to participating employees as specified by Rule
428(b)(1) of the Securities Act of 1933, as amended. Such documents and the
documents incorporated by reference herein pursuant to Item 3 of Part II hereof,
taken together, constitute a prospectus that meets the requirements of Section
10(a) of the Securities Act of 1933, as amended.
I-1
<PAGE>
PART II
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
ITEM 3. INCORPORATION OF DOCUMENTS BY REFERENCE.
The following documents filed by Carolina Power & Light Company (the
"Company") with the Commission pursuant to the Securities and Exchange Act of
1934, as amended (the "Exchange Act"), are hereby incorporated by reference into
this Registration Statement:
(a) The Company's Annual Report on Form 10-K for the fiscal year ended
December 31, 1998;
(b) The Company's Quarterly Report on Form 10-Q for the quarter ended
March 31, 1999;
(c) The Company's Quarterly Report on Form 10-Q for the quarter ended
June 30, 1999;
(d) The Company's Current Report on Form 8-K, dated February 26, 1999,
filed by the Company with the Commission under the Securities
Exchange Act of 1934;
(e) The Company's Current Report on Form 8-K, dated March 19, 1999,
filed by the Company with the Commission under the Securities
Exchange Act of 1934;
(f) The Company's Current Report on Form 8-K, dated July 22, 1999,
filed by the Company with the Commission under the Securities
Exchange Act of 1934;
(g) The Company's Current Report on Form 8-K, dated August 23, 1999,
filed by the Company with the Commission under the Securities
Exchange Act of 1934; and
(h) The Company's Current Report on Form 8-K, dated August 30, 1999,
filed by the Company with the Commission under the Securities
Exchange Act of 1934.
In addition to the foregoing, all documents subsequently filed by (i)
the Company or (ii) the Carolina Power & Light Company Management Deferred
Compensation Plan (the "Plan") pursuant to Sections 13(a), 13(c), 14 or 15(d) of
the Exchange Act, prior to the filing of a post-effective amendment which
indicates that all securities registered hereunder have been issued or which
deregisters all securities offered then remaining unsold, shall be deemed
incorporated by reference in this Registration Statement and to be a part hereof
from the date of the filing of such documents. Any statement, including
financial statements, contained in a document incorporated or deemed to be
incorporated by reference herein shall be deemed to be modified or superseded
for purposes of this Registration Statement to the extent that a statement
contained herein or in any other subsequently filed document which also is or is
deemed to be incorporated by reference
II-1
<PAGE>
herein modifies or supersedes such statement. Any such statement so modified or
superseded shall not be deemed, except as so modified or superseded, to
constitute a part of this Registration Statement.
ITEM 4. DESCRIPTION OF SECURITIES.
Under the Carolina Power & Light Company Management Deferred
Compensation Plan (the "Plan"), the Company will provide eligible employees the
opportunity to agree to the deferral of a specified percentage of their cash
compensation. Eligible employees who elect to participate in the Plan (each a
"Participant") may make compensation deferrals to deferral accounts administered
pursuant to the Plan in the form of deemed investments in certain deemed
investment funds individually chosen by each Participant from a list of
investment media provided pursuant to the Plan. Additionally, qualifying
Participants will receive matching allocations, pursuant to the terms of the
Plan, which the Company will allocate to a company account on behalf of such
Participants. Matching allocations allocated by the Company to a Participant's
company account will be deemed initially invested in hypothetical shares of the
Company's common stock. When a Participant's company account has matured,
pursuant to the terms of the Plan, the Participant may reallocate any part of
such account among the deemed investment funds chosen by the Participant. The
obligations of the Company under the Plan (the "Obligations") will be unsecured
general obligations of the Company to pay the deferred compensation in the
future in accordance with the terms of the Plan, and will rank pari passu with
other unsecured and unsubordinated indebtedness of the Company from time to time
outstanding.
The amount of compensation to be deferred by each Participant will be
determined in accordance with the Plan based on elections by each Participant.
Each Obligation will be payable on a date selected by each Participant in
accordance with the terms of the Plan. The Obligations will be indexed to the
deemed investment funds individually chosen by each Participant or, in the case
of Obligations in the form of hypothetical shares of the Company's common stock,
the closing price of a share of such stock on the New York Stock Exchange on the
relevant date. Each Participant's Obligations will be adjusted to reflect the
investment experience, whether positive or negative, of the Participant's
deferral account and/or company account, including any appreciation or
depreciation. The Obligations will be denominated and be payable in United
States dollars.
A Participant's right or the right of any other person to the
Obligations cannot be assigned, alienated, sold, garnished, transferred,
pledged, or encumbered except by a written designation of a beneficiary under
the Plan, by written will, or by the laws of descent and distribution.
The Obligations are not subject to redemption, in whole or in part,
prior to the individual payment dates specified by each Participant, at the
option of the Company or through operation of a mandatory or optional sinking
fund or analogous provision. However, the Company reserves the right to amend or
terminate the Plan at any time, except that no such amendment or termination
shall adversely affect the right of a Participant to the balance of his or her
deferred account as of the date of such amendment or termination.
II-2
<PAGE>
The Obligations are not convertible into another security of the
Company. The Obligations will not have the benefit of a negative pledge or any
other affirmative or negative covenant on the part of the Company. No trustee
has been appointed having the authority to take action with respect to the
Obligations and each Participant will be responsible for acting independently
with respect to, among other things, the giving of notices, responding to any
requests for consents, waivers or amendments pertaining to the Obligations,
enforcing covenants and taking action upon default.
ITEM 5. INTERESTS OF NAMED EXPERTS AND COUNSEL.
Not applicable.
ITEM 6. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
Sections 55-8-51 through 55-8-57 of the General Statutes of North
Carolina and the Charter and By-Laws of CP&L provide for indemnification of the
registrant's directors and officers in a variety of circumstances, which may
include liabilities under the Securities Act. CP&L has insurance covering its
expenditures which might arise in connection with the lawful indemnification of
its directors and officers for their liabilities and expenses. Officers and
directors of CP&L also have insurance which insures them against certain
liabilities and expenses.
ITEM 7. EXEMPTION FROM REGISTRATION CLAIMED.
Not applicable.
ITEM 8. EXHIBITS.
Exhibit No.
- -----------
II-3
<PAGE>
4 Carolina Power & Light Company Management Deferred Compensation
Plan, effective as of January 1, 2000.
5 Opinion of William D. Johnson as to the legality of the
securities being registered.
23.1 Consent of William D. Johnson (included in Exhibit 5).
23.2 Consent of Deloitte & Touche LLP.
24 Power of Attorney (included on signature page).
ITEM 9. UNDERTAKINGS
(a) The undersigned registrant hereby undertakes:
1. To file, during any period in which offers or sales are
being made, a post-effective amendment to this Registration Statement:
(i) to include any Prospectus required by
Section 10(a)(3) of the Securities Act;
(ii) to reflect in the Prospectus any facts or
events arising after the effective date of the Registration Statement (or the
most recent post-effective amendment thereof) which, individually or in the
aggregate, represent a fundamental change in the information set forth in the
Registration Statement; and
(iii) to include any material information with
respect to the plan of distribution not previously disclosed in this
Registration Statement or any material change to such information in this
Registration Statement;
provided, however, that the registrant need not file a post-effective amendment
to include the information required to be included by subsection (i) or (ii) if
such information is contained in periodic reports filed by the registrant
pursuant to Section 13 or Section 15(d) of the Exchange Act that are
incorporated by reference in this Registration Statement.
2. That, for the purpose of determining any liability under
the Securities Act, each such post-effective amendment shall be deemed to be a
new Registration Statement relating to the securities offered therein, and the
offering of such securities at that time shall be deemed to be the initial bona
fide offering thereof.
3. To remove from registration by means of a post-effective
amendment any of the securities being registered which remain unsold at the
termination of the offering.
II-4
<PAGE>
(b) That, for purposes of determining any liability under the
Securities Act, each filing of the registrant's annual report pursuant to
Section 13(a) or Section 15(d) of the Exchange Act that is incorporated by
reference in this Registration Statement shall be deemed to be a new
Registration Statement relating to the securities offered herein, and the
offering of such securities at that time shall be deemed to be the initial bona
fide offering thereof.
(c) Insofar as indemnification for liabilities arising under the
Securities Act may be permitted to directors, officers and controlling persons
of the registrant pursuant to the provisions described under Item 6 above, or
otherwise, the registrant has been advised that in the opinion of the Commission
such indemnification is against public policy as expressed in the Securities Act
and is, therefore, unenforceable. In the event that a claim for indemnification
against such liabilities (other than the payment by the registrant of expenses
incurred or paid by a director, officer or controlling person of the registrant
in the successful defense of any action, suit or proceeding) is asserted by such
director, officer or controlling person in connection with the securities being
registered, the registrant will, unless in the opinion of its counsel the matter
has been settled by controlling precedent, submit to a court of appropriate
jurisdiction the question whether such indemnification by it is against public
policy as expressed in the Securities Act and will be governed by the final
adjudication of such issue.
II-5
<PAGE>
POWER OF ATTORNEY
Each director and/or officer of the issuer whose signature appears
below hereby appoints William Cavanaugh III, Robert B. McGehee, and Timothy S.
Goettel, and each of them severally, as his attorney-in-fact to sign in his name
and behalf, in any and all capacities stated below, and to file with the
Commission, any and all amendments, including post-effective amendments, to this
Registration Statement.
SIGNATURES
THE REGISTRANT
Pursuant to the requirements of the Securities Act of 1933, the
registrant certifies that it has reasonable grounds to believe that it meets all
of the requirements for filing on Form S-8 and has duly caused this Registration
Statement to be signed on its behalf by the undersigned, thereunto duly
authorized, in the City of Raleigh, State of North Carolina on the 25th day of
October, 1999.
CAROLINA POWER & LIGHT COMPANY
/s/ William Cavanaugh III
---------------------------------------
William Cavanaugh III, Chairman of the Board,
President and Chief Executive Officer
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C> <C>
Signature Title Date
/s/William Cavanaugh III Chairman of the Board, President and Chief October 25, 1999
--------------------------------- Executive Officer and Director
William Cavanaugh III
/s/Glenn E. Harder Executive Vice President October 25, 1999
--------------------------------- and Chief Financial Officer
Glenn E. Harder
/s/Larry M. Smith Vice President and Controller October 25, 1999
---------------------------------
Larry M. Smith
II-6
<PAGE>
/s/Richard L. Daugherty Director October 25, 1999
---------------------------------
Richard L. Daugherty
/s/Robert L. Jones Director October 25, 1999
---------------------------------
Robert L. Jones
/s/Estell C. Lee Director October 25, 1999
---------------------------------
Estell C. Lee
/s/William O. McCoy Director October 25, 1999
---------------------------------
William O. McCoy
/s/Sherwood H. Smith, Jr. Director October 25, 1999
---------------------------------
Sherwood H. Smith, Jr.
/s/J. Tylee Wilson Director October 25, 1999
---------------------------------
J. Tylee Wilson
</TABLE>
II-7
<PAGE>
THE PLAN
Pursuant to the requirements of the Securities Act, the Plan has duly
caused this Registration Statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in the City of Raleigh, State of North
Carolina, on October 25, 1999.
CAROLINA POWER & LIGHT COMPANY
MANAGEMENT DEFERRED COMPENSATION PLAN
/s/Bob Stock
-------------------------------------
Bob Stock on behalf of The
Carolina Power & Light
Company Management Deferred Compensation
Plan Administrative Committee
II-8
<PAGE>
EXHIBIT INDEX
EXHIBIT NO. DESCRIPTION
- ----------- -----------
4 Carolina Power & Light Company Management Deferred
Compensation Plan, effective as of January 1, 2000.
5 Opinion of William D. Jobnson as to the legality of the
securities being registered.
23.1 Consent of William D. Jobnson (included in Exhibit 5).
23.2 Consent of Deloitte & Touche LLP.
24 Power of Attorney (included on signature page).
EXHIBIT 4
CAROLINA POWER & LIGHT COMPANY
MANAGEMENT DEFERRED COMPENSATION PLAN
Adopted as of January 1, 2000
<PAGE>
TABLE OF CONTENTS
PAGE
PREAMBLE .............................................................1
Article I. DEFINITIONS.....................................................2
1.1 Account Balance................................................2
1.2 Additional Deferral Election...................................2
1.3 Board..........................................................2
1.4 Board Committee................................................2
1.5 Change of Control..............................................2
1.6 Change-of-Form Election........................................3
1.7 Change-of-Investment Election..................................3
1.8 Code...........................................................3
1.9 Committee......................................................4
1.10 Company........................................................4
1.11 Continuing Directors...........................................4
1.12 Deemed Investment Return.......................................4
1.13 Deferral Election..............................................4
1.14 Deferrals......................................................4
1.15 Effective Date.................................................4
1.16 Eligible Employee..............................................5
1.17 Employee Stock Incentive Plan..................................5
1.18 Enrollment Form................................................5
1.19 ERISA..........................................................5
1.20 Incentive Matching Allocations.................................5
1.21 Investment Election............................................5
1.22 Matching Allocation............................................5
1.23 Matured Plan Year Company Account..............................6
1.24 Net Salary.....................................................6
1.25 Participant....................................................6
1.26 Participant Accounts...........................................6
1.27 Participant Company Account....................................6
1.28 Participant Deferral Account...................................6
1.29 Participant Matchable Deferral.................................7
1.30 Payment Commencement...........................................7
1.31 Phantom Investment Fund........................................7
1.32 Phantom Funds Account..........................................7
1.33 Phantom Investment Subaccount..................................8
1.34 Phantom Stock Unit.............................................8
1.35 Plan...........................................................8
1.36 Plan Year......................................................8
1.37 Plan Year Accounts.............................................8
1.38 Retirement Date................................................8
1.39 Salary.........................................................9
1.40 SMC Participant................................................9
i
<PAGE>
<TABLE>
<CAPTION>
PAGE
<S> <C> <C>
1.41 Sponsor....................................................................9
1.42 SSERP......................................................................9
1.43 Stock Purchase-Savings Plan................................................9
1.44 Valuation Date.............................................................9
1.45 Value......................................................................9
1.46 Years of Service..........................................................10
Article II. PARTICIPATION..............................................................11
2.1 Eligibility..............................................................11
2.2 Commencement of Participation............................................11
2.3 Annual Participation Agreement...........................................11
2.4 Election of Phantom Investment Subaccounts...............................12
Article III. DEFERRAL ELECTIONS.........................................................13
3.1 Participant Deferred Salary Elections.....................................13
3.2 Matching Allocations......................................................14
3.3 Incentive Matching Allocations............................................14
Article IV. ACCOUNTS...................................................................16
4.1 Maintenance of Accounts...................................................16
4.2 Separate Plan Year Accounts...............................................16
4.3 Phantom Investment Subaccounts............................................16
4.4 Administration of Deferral Accounts.......................................16
4.5 Administration of Company Accounts........................................17
4.6 Change of Phantom Investment Subaccounts and Phantom Stock Units..........18
4.7 Transferred Accounts......................................................19
Article V. VESTING....................................................................20
5.1 Vesting...................................................................20
Article VI. DISTRIBUTIONS..............................................................21
6.1 Distribution Elections....................................................21
6.2 Change-of-Form Elections and Additional Deferral Elections................21
6.3 Payment...................................................................22
6.4 Hardships.................................................................22
6.5 Termination of Employment.................................................23
6.6 Taxes.....................................................................23
6.7 Acceleration of Payment...................................................24
Article VII. DEATH BENEFITS.............................................................25
7.1 Designation of Beneficiaries..............................................25
7.2 Death Benefit.............................................................25
</TABLE>
ii
<PAGE>
PAGE
Article VIII. CLAIMS...........................................26
8.1 Claims Procedure....................................26
8.2 Claims Review Procedure.............................26
Article IX. ADMINISTRATION.....................................28
9.1 Committee...........................................28
9.2 Authority...........................................28
Article X. AMENDMENT AND TERMINATION OF THE PLAN...............30
10.1 Amendment of the Plan...............................30
10.2 Termination of the Plan.............................30
10.3 No Impairment of Benefits...........................30
Article XI. FUNDING AND CLAIM STATUS...........................31
11.1 General Provisions..................................31
Article XII. EFFECT ON EMPLOYMENT OR ENGAGEMENT................33
12.1 General.............................................33
Article XIII. GOVERNING LAW....................................34
13.1 General.............................................34
iii
<PAGE>
PREAMBLE
The Carolina Power & Light Company Management Deferred
Compensation Plan (the "Plan") has been adopted by Carolina Power & Light
Company (the "Company") effective as of January 1, 2000. The Plan is unfunded
and will benefit only a select group of management or highly compensated
employees within the meaning of Title I of the Employee Retirement Income
Security Act of 1974, as amended ("ERISA").
1
<PAGE>
ARTICLE I
DEFINITIONS
1.1 Account Balance
---------------
The value in terms of a dollar amount of a Participant's Deferral
Account or Company Account, as the case may be, as of the last Valuation Date.
1.2 Additional Deferral Election
----------------------------
The election by a Participant under Section 6.2 to defer distribution
from a Plan Year Account.
1.3 Board
-----
The Board of Directors of the Sponsor.
1.4 Board Committee
---------------
The Organization and Compensation Committee of the Board.
1.5 Change of Control
-----------------
The first to occur of the following circumstances:
(i) the acquisition by any person (including a group, within the
meaning of Section 13(d) of the Securities Exchange Act of 1934, as
amended), of beneficial ownership of 15% or more of the Company's then
outstanding voting securities;
(ii) a tender offer is made and consummated for the ownership of
51% or more of the Sponsor's then outstanding voting securities;
(iii) the first day on which less than 66-2/3 percent of the total
membership of the Board are Continuing Directors;
2
<PAGE>
(iv) approval by the stockholders of the Sponsor of a merger,
consolidation, liquidation or dissolution of the Sponsor, or the sale
of all or substantially all of the assets of the Company.
A Change of Control shall not be deemed to have occurred until the
Board or a committee or subcommittee of the Board receives written certification
from the Sponsor's President and Chief Executive Officer or, in the event of his
or her inability to act, the Sponsor's Chief Financial Officer, or any Executive
or Senior Vice President of the Sponsor that one of the events set forth in
Section 1.4(i) through (iv) has occurred. The officers referred to in the
previous sentence shall be those officers in office immediately prior to the
occurrence of one of the events set forth above in Section 1.4(i) through (iv)
above. Any determination under the Plan that an event described in Section
1.4(i) through (iv) above has occurred shall be made in good faith by the Board
Committee on the basis of information available at the time and be conclusive
and binding for all purposes of the Plan.
1.6 Change-of-Form Election
-----------------------
The election by a Participant under Section 6.2 to change the form of
distribution of a Plan Year Account.
1.7 Change-of-Investment Election
-----------------------------
The election by a Participant under Section 4.6 to change a Phantom
Subaccount for the Participant Deferral Account or Company Account.
1.8 Code
----
The Internal Revenue Code of 1986, as amended, or any successor
statute.
3
<PAGE>
1.9 Committee
---------
The Administrative Committee described in Section 9.1 for administering
the Plan.
1.10 Company
-------
Carolina Power & Light Company and any successor in interest and its
wholly owned subsidiaries which elect to participate in the Plan with the
approval of the Board Committee.
1.11 Continuing Directors
--------------------
The members of the Board at the Effective Date; PROVIDED, HOWEVER, that
any person becoming a director subsequent to such whose election or nomination
for election was supported by 75% or more of the directors who then comprised
Continuing Directors shall be considered to be a Continuing Director.
1.12 Deemed Investment Return
------------------------
The amounts that are credited (or charged) from time to time to each
Participant's Deferral Account and Company Account to reflect deemed investment
gains and losses of Phantom Investment Subaccounts.
1.13 Deferral Election
-----------------
An election to defer Salary pursuant to Section 3.1.
1.14 Deferrals
---------
The deferrals of Salary of a Participant pursuant to Section 3.1.
1.15 Effective Date
--------------
January 1, 2000.
4
<PAGE>
1.16 Eligible Employee
-----------------
An employee of the Company who is eligible to participate in the
Company's Management Incentive Compensation Plan and who is not excluded from
participation pursuant to Section 2.1(b).
1.17 Employee Stock Incentive Plan
-----------------------------
The Employee Stock Incentive Plan as adopted by the Board and any
successor to such plan which provides additional matching allocations under the
Stock Purchase-Savings Plan.
1.18 Enrollment Form
---------------
The enrollment form prepared by the Company which a Participant must
execute to have Deferrals with respect to a Plan Year.
1.19 ERISA
-----
The Employee Retirement Income Security Act of 1974, as amended.
1.20 Incentive Matching Allocations
------------------------------
The additional match allocation which is to be allocated to a
Participant's Company Account in accordance with Section 3.3.
1.21 Investment Election
-------------------
The election by a Participant under Sections 2.4 and 4.6 of the Phantom
Investment Subaccounts in which the Participant's Deferral Accounts and Company
Accounts will be allocated.
1.22 Matching Allocation
-------------------
A match allocation to a Participant's Company Account of a
Participant's Matchable Deferrals in accordance with Section 3.2.
5
<PAGE>
1.23 Matured Plan Year Company Account
---------------------------------
A Plan Year Company Account of a Participant which has matured in
accordance with Section 5.1(c).
1.24 Net Salary
----------
The Salary of a Participant projected to be payable (assuming no
deferral elections under the Plan or the Stock Purchase-Savings Plan) with
respect to a Plan Year reduced by the projected Deferrals of a Participant for
the Plan Year under the Plan.
1.25 Participant
-----------
An Eligible Employee participating in the Plan pursuant to Article II.
1.26 Participant Accounts
--------------------
The aggregate of a Participant's Deferral Account and Participant's
Company Accounts.
1.27 Participant Company Account
---------------------------
The notional bookkeeping account maintained under Sections 4.1 and 4.5
to record Matching Allocations and Incentive Matching Allocations on behalf of a
Participant and the Deemed Investment Return thereon pursuant to the provisions
of the Plan.
1.28 Participant Deferral Account
----------------------------
The notional bookkeeping account maintained under Section 4.1 of the
Plan to record Deferrals of a Participant and the Deemed Investment Return
thereon pursuant to the provisions of the Plan.
6
<PAGE>
1.29 Participant Matchable Deferral
------------------------------
6% of the amount of Deferrals of a Participant for a Plan Year but no
greater than 6% of (A-B) where A is the compensation limit under Section
401(a)(17) of the Code for the Plan Year and B is the Net Salary of a
Participant for the Plan Year (with any negative differences equating to $0 for
purposes of this calculation); PROVIDED, HOWEVER, that the Participant Matchable
Deferrals for an SMC Participant for a Plan Year shall be an amount equal to 6%
of (C - D) where C is the projected Salary of a Participant for the Plan Year
and D is the compensation limit under Section 401(a)(17) of the Code for the
Plan Year. Participant Matchable Deferrals for a Plan Year shall be determined
for each payroll period during the Plan Year based on projected Matchable
Deferrals for the entire Plan Year.
1.30 Payment Commencement
--------------------
The date payments are to commence with respect to a Plan Year Account
in accordance with Section 6.1.
1.31 Phantom Investment Fund
-----------------------
A deemed investment option selected by the Committee for purposes of
the Plan.
1.32 Phantom Funds Account
---------------------
Notional bookkeeping accounts maintained under the Plan at the
direction of the Committee representing allocations of Participants of Phantom
Investment Subaccounts in a Phantom Investment Fund.
7
<PAGE>
1.33 Phantom Investment Subaccount
-----------------------------
A notional bookkeeping account maintained under the Plan at the
direction of the Committee representing a deemed investment in one or more
Phantom Investment Funds as directed by the Participant under Sections 2.4 and
4.6.
1.34 Phantom Stock Unit
------------------
A hypothetical share of common stock of Carolina Power & Light Company.
1.35 Plan
----
The Carolina Power & Light Company Management Deferred Compensation
Plan as set forth herein and as amended from time to time.
1.36 Plan Year
---------
The twelve (12) consecutive month periods beginning January 1 and
ending the following December 31 commencing with the Effective Date.
1.37 Plan Year Accounts
------------------
The separate Participant Deferral Account and Participant Company
Account maintained under the Plan pursuant to Section 4.2 with respect to a
Participant for each Plan Year a Participant has Deferrals.
1.38 Retirement Date
---------------
The date a Participant retires from the Company on or after attaining
(i) age 65 with 5 years of service, (ii) age 55 with 15 years of service, (iii)
35 years of service or (iv) eligibility for retirement under the SSERP if
covered under such plan.
8
<PAGE>
1.39 Salary
------
The amount of an Eligible Employee's regular annual base salary,
payable from time to time by the Company prior to a Deferral Election under the
Plan and prior to any deferral election under the Stock Purchase-Savings Plan.
1.40 SMC Participant
---------------
A senior executive officer of the Company who is a member of the
"Senior Management Committee" of the Company.
1.41 Sponsor
-------
Carolina Power & Light Company and its successors in interest.
1.42 SSERP
-----
The Supplemental Senior Executive Retirement Plan of the Company.
1.43 Stock Purchase-Savings Plan
---------------------------
The Stock Purchase-Savings Plan of Carolina Power & Light Company
adopted by the Board and any successor to such plan.
1.44 Valuation Date
--------------
The last day of each calendar month and such other dates as selected by
the Committee, in its sole discretion.
1.45 Value
-----
The value of an account maintained under the Plan based on the fair
market value of notional investments of Phantom Investment Subaccounts and
Phantom Stock Units, as the case may be, as of the last Valuation Date. For
purposes of calculating Value as of the end of a Plan Year, accrued but
unallocated Incentive
9
<PAGE>
Matching Allocations shall be taken into consideration with respect to
Participant Company Accounts.
1.46 Years of Service
----------------
Years of service of a Participant as calculated under the Stock
Purchase-Savings Plan.
10
<PAGE>
Article II
PARTICIPATION
2.1 Eligibility
-----------
(a) Participation in the Plan shall be limited to Eligible Employees.
(b) The Committee, in its sole discretion, may at any time limit the
participation of an Eligible Employee in the Plan so as to assure that the Plan
will not be subject to the provisions of parts 2, 3 and 4 of Title I of ERISA.
2.2 Commencement of Participation
-----------------------------
Each Eligible Employee on the Effective Date may elect to become a
Participant as of the Effective Date by completing and submitting an Enrollment
Form to the Sponsor's designated agent by November 30, 1999. An employee of the
Company first becoming an Eligible Employee after January 1, 2000 may elect to
become a Participant effective as of thirty days after first becoming an
Eligible Employee by completing and submitting an Enrollment Form to the
Sponsor's designated agent within such thirty-day period. An Eligible Employee
who is not a Participant may elect to become a Participant as of the first day
of a Plan Year commencing after December 31, 2000 by completing and submitting
an Enrollment Form to the Sponsor's designated agent by November 30 prior to the
commencement of the Plan Year.
2.3 Annual Participation Agreement
------------------------------
Each Participant shall complete a new Enrollment Form with respect to a
Plan Year by November 30 prior to the commencement of the Plan Year. If the
Participant does not complete such form and submit it to the Sponsor's
designated agent by November 30, the Participant will have no Deferrals for the
following Plan Year.
11
<PAGE>
2.4 Election of Phantom Investment Subaccounts
------------------------------------------
Each Participant shall elect on his Enrollment Form the allocation of
his Plan Year Participant Deferral Account among the Phantom Investment
Subaccounts.
12
<PAGE>
Article III
DEFERRAL ELECTIONS
3.1 Participant Deferred Salary Elections
-------------------------------------
(a) A Participant completing an Enrollment Form in accordance with
Sections 2.2 or 2.3 may make an election, pursuant to this Section 3.1, to
defer his or her Salary (a "Deferral Election") in accordance with the
Plan. A Deferral Election shall apply only to the Participant's Salary for
the Plan Year specified in the Enrollment Form.
(b) Deferral Elections shall be made in writing on the Enrollment Form
for the applicable Plan Year pursuant to the following limitations:
(i) A Participant who is eligible for a bonus at the 15% of
salary target incentive level (the "Target") for the Plan Year under
the Company Management Incentive Compensation Plan ("MICP") may defer
up to 15% of Salary.
(ii) A Participant who is eligible for a bonus at the 20% of
salary Target for the Plan Year under the MICP may defer up to 25% of
Salary.
(iii) A Participant who is eligible for a bonus at the 25% or
more of salary Target under the MICP may defer up to 50% of Salary.
All Deferrals shall be in increments of 5% of Salary. The minimum
projected Deferrals for a Plan Year for a Participant who commences Deferrals
after the beginning of a Plan Year in accordance with Section 2.2 shall be
$1,000.
(c) A Deferral Election once made with respect to a Plan Year, cannot
be changed or revoked. In the case of a new Participant, the Deferral
Election will
13
<PAGE>
apply only to amounts that are both paid after the election is made and
earned for services performed after the election is made. The amount of
Salary that is deferred pursuant to a Deferral Election will reduce the
Participant Salary proportionately throughout the applicable Plan Year or,
in the case of a new Participant, throughout the portion of the Plan Year
to which the Deferral Election is applicable.
(d) A dollar amount equal to the Salary deferred pursuant to this
Section 3.1 ("Deferrals") at each applicable payroll date shall be credited
to the Participant's Deferral Account within ten business days following
the applicable payroll date.
3.2 Matching Allocations
--------------------
A Participant who has made a Deferral Election with respect to a Plan
Year and has Participant Matchable Deferrals for such Plan Year shall receive a
credit to his Participant Company Account of a Matching Allocation for such Plan
Year. The Matching Allocation with respect to a Plan Year shall equal 50% of the
Participant Matchable Deferrals. Matching Allocations shall be credited to the
Participant Company Account within ten business days following the applicable
payroll date, based on a pro-rata portion of projected Matchable Deferrals for
the Plan Year applicable to each payroll period during the Plan Year.
3.3 Incentive Matching Allocations
------------------------------
Participants with Matchable Deferrals for a Plan Year shall
receive a credit to their Participant Company Account for the Plan Year of an
Incentive Matching Allocation if an "Incentive Matching Allocation" is provided
under the Stock Purchase-
14
<PAGE>
Savings Plan for the Plan Year. The Incentive Matching Allocation shall equal
that percentage of the Participant Matchable Deferrals for the Plan Year equal
to the "Incentive Matching Allocation" (stated as a percentage) provided (or
that would have been provided if the Participant participated) under the Stock
Purchase-Savings Plan for such Plan Year. Incentive Matching Allocations with
respect to a Plan Year, if any, shall be credited to a Participant's Company
Account in accordance with Section 4.5 pursuant to rules and procedures adopted
by the Committee approximately coincident with the credit under the Stock
Purchase-Savings Plan of "Incentive Matching Allocations" following the end of a
Plan Year; PROVIDED, HOWEVER, no such allocation shall be made if a Participant
is not employed at the end of the applicable Plan Year, unless the Participant
retired, died, or became disabled during the Plan Year.
15
<PAGE>
Article IV
ACCOUNTS
4.1 Maintenance of Accounts
-----------------------
The Committee shall maintain a Participant Deferral Account and a
Participant Company Account for each Participant. There shall be credited to a
Participant's Deferral Account all Deferrals by a Participant under the Plan and
there shall be credited to a Participant's Company Account all Matching
Allocations and Incentive Matching Allocations with respect to a Participant
under the Plan in accordance with Sections 3.1 and 3.2.
4.2 Separate Plan Year Accounts
---------------------------
The Committee shall maintain a separate Participant Deferral Account
and Participant Company Account for each Plan Year a Participant has Deferrals
(separately a "Plan Year Deferral Account" and a "Plan Year Company Account" and
together the "Plan Year Account").
4.3 Phantom Investment Subaccounts
------------------------------
The Committee shall maintain separate Phantom Investment Subaccounts
representing deemed investments in Phantom Investment Funds as directed by the
Participant. Phantom Investment Subaccounts shall be valued as of each Valuation
Date based on the notional investments of each such account, pursuant to rules
and procedures adopted by the Committee.
4.4 Administration of Deferral Accounts
-----------------------------------
(a) A Participant's Deferral Accounts shall be comprised in total, of
units in Phantom Investment Subaccounts.
16
<PAGE>
(b) Participants shall allocate their Deferrals among Phantom
Investment Subaccounts pursuant to elections under Section 2.4.
(c) The Value of that portion of a Participant's Deferral Account
allocated to a Phantom Investment Subaccount shall be changed on each
Valuation Date to reflect the new Value of the Phantom Investment
Subaccount.
(d) The interest of a Participant's Deferral Account in a Phantom
Investment Subaccount shall be stated in a unit value or dollar amount, as
determined by the Committee.
4.5 Administration of Company Accounts
----------------------------------
(a) A Participant's Company Account shall be comprised of Phantom Stock
Units or fractions thereof, and of units in Phantom Investment Subaccounts
pursuant to an election by the Participant under Section 4.6(b). All
Matching Allocations and Incentive Matching Allocations shall be deemed
invested in Phantom Stock Units on the date of allocations under the Plan
based on the closing price of a share of common stock of the Sponsor on the
New York Stock Exchange on the date of such allocation.
(b) The number of Phantom Stock Units allocated to a Participant's
Company Account shall be adjusted periodically to reflect the deemed
reinvestment of dividends on Sponsor common stock in additional Phantom
Stock Units.
(c) In the event there is any change in the common stock of the
Sponsor, through merger, consolidation, reorganization, recapitalization
(other than pursuant to bankruptcy proceedings), stock dividend, stock
split, reverse stock
17
<PAGE>
split, split-up, split-off, spin-off, combination of shares, exchange of
shares, dividend in kind or other like change in capital structure (an
"Adjustment Event"), the number of Phantom Stock Units subject to the Plan
shall be adjusted by the Committee in its sole judgment so as to give
appropriate effect to such Adjustment Event. Any fractional units resulting
from such adjustment may be eliminated. Each successive Adjustment Event
shall result in the consideration by the Committee of whether any
adjustment to the number of Phantom Stock Units subject to the Plan is
necessary in the Committee's judgment. Issuance of common stock or
securities convertible into common stock for value will not be deemed to be
an Adjustment Event unless otherwise expressly determined by the Committee.
4.6 Change of Phantom Investment Subaccounts and Phantom Stock Units
----------------------------------------------------------------
(a) A Participant may elect to reallocate the value of his Phantom
Investment Subaccounts comprising his Deferral Accounts among other Phantom
Investment Subaccounts and change the allocation of future Deferrals among
Phantom Investment Subaccounts once per calendar month, pursuant to uniform
rules and procedures adopted by the Committee.
(b) A Participant may elect to reallocate (i) the Phantom Stock Units
which are part of a Matured Plan Year Company Account among Phantom
Investment Subaccounts and (ii) Phantom Investment Subaccounts comprising
part of his Company Account, once per calendar month, pursuant to uniform
rules adopted by the Committee.
18
<PAGE>
4.7 Transferred Accounts
--------------------
(a) Effective as of the Effective Date, the Value of a SMC
Participant's Company Account shall include the value of such Participant's
deferral account as of such date (being a "Transferred Account") under the
Carolina Power & Light Executive Deferred Compensation Plan, but only to
the extent the Participant acknowledges in writing he has no further
interest in the Executive Deferred Compensation Plan.
(b) Effective on the Effective Date, the Value of any Participant's
company Account shall include the value of such Participant's additional
benefits (currently recorded as phantom Company stock units) granted under
Article VIII.2. (also being a "Transferred Account") under the Company's
Deferred Compensation Plan for Key Management Employees, but only to the
extent the Participant acknowledges in writing that he has no further
interest in these benefits in the Company's Deferred Compensation Plan for
key Management Employees.
(c) The total value of the Transferred Accounts as described in this
Section 4.7 shall be deemed a vested Matured Plan Year Company Account for
all purposes of the Plan.
19
<PAGE>
Article V
VESTING
5.1 Vesting
-------
(a) A Participant's Deferral Accounts shall be 100% vested at all
times. A Participant's Company Accounts shall vest in accordance with the
following schedule:
Years of Service Percent of Vesting
---------------- ------------------
Less than 5 0
5 or more 100%
(b) If not otherwise vested under Section 5.1(a), a Participant's Plan
Year Company Account shall vest two years after the end of the applicable
Plan Year.
(c) A Participant's Plan Year Company Account shall be deemed a Matured
Plan Year Company Account two years after the end of the applicable Plan
Year.
20
<PAGE>
Article VI
DISTRIBUTIONS
6.1 Distribution Elections
----------------------
A Participant when making a Deferral Election pursuant to an Enrollment
Form with respect to a Plan Year shall elect on such Enrollment Form (a) to
defer the payment of his Plan Year Accounts with respect to such Plan Year, in
accordance with the Plan until (i) the April 1 following the date that is five
years from the last day of such Plan Year, (ii) the April 1 following the
Participant's Retirement or (iii) the April 1 following the first anniversary of
the Participant's Retirement (each a "Payment Commencement Date") and (b) to
provide for the payment of such Plan Year Account in the form of (i) a lump sum
or (ii) approximately equal installments over a period extending from two years
to ten years (by paying a fraction of the account balance each year during such
period), as elected by the Participant. Except as otherwise provided in this
ARTICLE VI, such elections may not be changed or revoked.
6.2 Change-of-Form Elections and Additional Deferral Elections
----------------------------------------------------------
Any Participant who has made elections under Section 6.1 with respect
to Plan Year Accounts may elect at least one year prior to the Payment
Commencement Date with respect to such accounts a new Payment Commencement Date
that either is five years from the then current Payment Commencement Date or
otherwise is permitted under Section 6.1(a)(ii) or (iii). Only one such
Additional Deferral Election will be permitted with respect to Plan Year
Accounts relating to a particular Plan Year. In addition a Participant may elect
to change the form of distribution to any of the forms permitted under Section
6.1(b) by completing a Change-of-Form Elections with respect
21
<PAGE>
to Plan Year Accounts at least one year prior to the applicable Payment
Commencement Date for such accounts.
6.3 Payment
-------
Upon occurrence of an event specified in the Participant's distribution
election under Section 6.1 (a "Distribution Event") with respect to Plan Year
Accounts, as modified by any applicable subsequent Additional Deferral Election
under Section 6.2, the Account Balance of a Participant's Plan Year Accounts
shall be paid by the Company to the Participant in the form elected under
Section 6.1 as modified by any subsequent Change-of-Form Election under Section
6.2. Such payments shall commence as soon as practicable and in no event more
than 30 days following the occurrence of the Distribution Event.
6.4 Hardships
---------
In case of an unforeseeable emergency, a Participant may request the
Committee, on a form to be provided by the Committee or its delegate, that
payment of the vested portion of Participant Accounts be made earlier than the
date provided under the Plan.
An "unforeseeable emergency" shall be limited to a severe financial
hardship to the Participant resulting from a sudden and unexpected illness or
accident of the Participant or of a dependent (as defined in Section 152(a) of
the Code) of the Participant, loss of the Participant's property due to
casualty, or other similar extraordinary and unforeseeable circumstances arising
as a result of events beyond the control of the Participant. The circumstances
that will constitute an unforeseeable emergency will depend upon the facts of
each case, but, in any case, payment may not be
22
<PAGE>
made to the extent that such hardship is or may be relieved: (i) through
reimbursement or compensation by available insurance or otherwise or (ii) by
liquidation of the Participant's assets, to the extent the liquidation of such
assets would not itself cause severe financial hardship.
The Committee shall consider any requests for payment under this
Section 6.4 on a uniform and nondiscriminatory basis and in accordance with the
standards of interpretation described in Section 457 of the Code and the
regulations thereunder.
In the event of a hardship determination by the Committee, the Company
shall pay out in a lump sum to the Participant such portion of the Participant
Accounts as determined by the Committee and Deferrals by the Participant for the
Plan Year in which the hardship distribution is made will cease.
6.5 Termination of Employment
-------------------------
In the event of the termination of the employment of a Participant with
the Company and any parent, subsidiary or affiliate for any reason, other than
Retirement or death, the vested portion of the Participant Accounts of such
Participant shall be paid in a lump sum to such Participant based on the Value
of such accounts on the Valuation Date immediately following the termination
date. Such payment shall be made as soon as administratively practicable
following the Participant's termination date as determined under the Company's
normal administrative practices. The nonvested portion of a terminated
Participant's Company Account shall be forfeited by the Participant.
6.6 Taxes
-----
The Company shall deduct from all payments under the Plan federal,
state and local income and employment taxes, as required by applicable law.
Deferrals will be
23
<PAGE>
taken into account for purposes of any tax or withholding obligation under the
Federal Insurance Contributions Act and Federal Unemployment Tax Act in the year
of the Deferrals, as required by Sections 3121(v) and 3306(r) of the Code and
the regulations thereunder. Amounts required to be withheld in the year of the
Deferrals pursuant to Sections 3121(v) and 3306(r) shall be withheld out of
current wages or other compensation paid by the Company to the Participant.
6.7 Acceleration of Payment
-----------------------
Notwithstanding any provision contained in the Plan to the contrary,
the Committee may, in its sole discretion, accelerate the distribution in a lump
sum of the Value of all Participant Accounts on the date of a Change of Control.
Such payment shall be made by the Company, to the extent practicable, on the
date of such Change of Control.
24
<PAGE>
Article VII
DEATH BENEFITS
7.1 Designation of Beneficiaries
----------------------------
The Participant's beneficiary under this Plan entitled to receive
benefits under the Plan in the event of the Participant's death shall be
designated by the Participant on a form provided by the Committee. In the
absence of such designation or in the event the designated beneficiary has
predeceased the Participant, the beneficiary shall be deemed the estate of the
Participant.
7.2 Death Benefit
-------------
In the event of the death of a Participant prior to the payout of his
Participant Accounts, the Value of the remaining portion of the Participant
Accounts shall be paid by the Company in a lump sum to the Participant's
beneficiary (as defined under Section 7.1) based on the Value of such accounts
on the Valuation Date immediately following the date of death. Payment shall be
made as soon as administratively practicable following such Valuation Date
pursuant to rules and procedures adopted by the Committee.
25
<PAGE>
Article VIII
CLAIMS
8.1 Claims Procedure
----------------
If any Participant or his or her beneficiary has a claim for benefits
which is not being paid, such claimant may file with the Committee a written
claim setting forth the amount and nature of the claim, supporting facts, and
the claimant's address. The Committee shall notify each claimant of its decision
in writing by registered or certified mail within sixty (60) days after its
receipt of a claim or, under special circumstances, within ninety (90) days
after its receipt of a claim. If a claim is denied, the written notice of denial
shall set forth the reasons for such denial, refer to pertinent Plan provisions
on which the denial is based, describe any additional material or information
necessary for the claimant to realize the claim, and explain the claims review
procedure under the Plan.
8.2 Claims Review Procedure
-----------------------
A claimant whose claim has been denied, or such claimant's duly
authorized representative, may file, within sixty (60) days after notice of such
denial is received by the claimant, a written request for review of such claim
by the Committee. If a request is so filed, the Committee shall review the claim
and notify the claimant in writing of its decision within sixty (60) days after
receipt of such request. In special circumstances, the Committee may extend for
up to sixty (60) additional days the deadline for its decision. The notice of
the final decision of the Committee shall include the reasons for its decision
and specific references
26
<PAGE>
to the Plan provisions on which the decision is based. The decision of the
Committee shall be final and binding on all parties.
27
<PAGE>
Article IX
ADMINISTRATION
9.1 Committee
---------
The Administrative Committee consisting of not less than three (3) nor
more than seven (7) persons appointed by the Board Committee or its delegate to
administer the Plan.
9.2 Authority
---------
(a) The Committee shall have the exclusive right to interpret the Plan
to the maximum extent permitted by law, to prescribe, amend and rescind
rules and regulations relating to it, and to make all other determinations
necessary or advisable for the administration of the Plan, including the
determination under Section 9.2(b) herein. The decisions, actions and
records of the Committee shall be conclusive and binding upon the Company
and all persons having or claiming to have any right or interest in or
under the Plan
(b) The Committee may delegate to one or more agents, or to the Company
such administrative duties as it may deem advisable. The Committee may
employ such legal or other counsel and consultants as it may deem desirable
for the administration of the Plan and may rely upon any opinion or
determination received from counsel or consultant.
(c) No member of the Committee shall be directly or indirectly
responsible or otherwise liable for any action taken or any failure to take
action as a member of the Committee, except for such action, default,
exercise or failure to exercise resulting from such member's gross
negligence or willful misconduct.
28
<PAGE>
No member of the Committee shall be liable in any way for the acts or
defaults of any other member of the Committee, or any of its advisors,
agents or representatives.
(d) The Company shall indemnify and hold harmless each member of the
Committee against any and all expenses and liabilities arising out of his
or her own activities relating to the Committee, except for expenses and
liabilities arising out of a member's gross negligence or willful
misconduct.
(e) The Company shall furnish to the Committee all information the
Committee may deem appropriate for the exercise of its powers and duties in
the administration of the Plan. The Committee shall be entitled to rely on
any information provided by the Company without any investigation thereof.
(f) No member of the Committee may act, vote or otherwise influence a
decision of such Committee relating to his or her benefits, if any, under
the Plan.
29
<PAGE>
Article X
AMENDMENT AND TERMINATION OF THE PLAN
10.1 Amendment of the Plan
---------------------
The Plan may be wholly or partially amended or otherwise modified at
any time by the Board or the Board Committee.
10.2 Termination of the Plan
-----------------------
The Plan may be terminated at any time by written action of the Board
or the Board Committee or by the Committee as provided under the Plan. On
termination of the Plan, the Committee may (but shall not be required to) direct
the immediate payment of all benefits under the Plan by the Company employing
each respective Participant.
10.3 No Impairment of Benefits
-------------------------
Notwithstanding the provisions of Sections 10.1 and 10.2, no amendment
to or termination of the Plan shall impair any rights to benefits which
theretofore accrued hereunder; PROVIDED, HOWEVER, an immediate payout of all
Plan benefits on termination of the Plan, pursuant to Section 10.2, or a change
of any Phantom Investment Funds or creation of a substitute for Phantom
Investment Funds as a result of a Plan amendment or action of the Committee
shall not constitute an impairment of any rights or benefits.
30
<PAGE>
Article XI
FUNDING AND CLAIM STATUS
11.1 General Provisions
------------------
(a) The Company shall make no provision for the funding of any
Participant Accounts payable hereunder that (i) would cause the Plan to be
a funded plan for purposes of Section 404(a)(5) of the Code or for purposes
of Title I of ERISA, or (ii) would cause the Plan to be other than an
"unfunded and unsecured promise to pay money or other property in the
future" under Treasury Regulations ss. 1.83-3(e); and, except in the case
of a Change of Control of the Sponsor, the Company shall have no obligation
to make any arrangements for the accumulation of funds to pay any amounts
under this Plan. Subject to the restrictions of this Section 11.1, the
Company, in its sole discretion, may establish one or more grantor trusts
described in Treasury Regulations ss. 1.677(a)-1(d) to accumulate funds to
pay amounts under this Plan, provided that the assets of such trust(s)
shall be required to be used to satisfy the claims of the Company's general
creditors in the event of the Company's bankruptcy or insolvency.
(b) In the case of a Change of Control, the Company shall, subject to
the restrictions in this paragraph and in Section 11.1, irrevocably set
aside funds in one or more such grantor trusts in an amount that is
sufficient to pay each Participant employed by such Company (or
beneficiary) the net present value as of the date on which the Change of
Control occurs, of the benefits to which Participants (or their
beneficiaries) would be entitled pursuant to the terms of the
31
<PAGE>
Plan if the Value of their Participant Account would be paid in a lump sum
upon the Change of Control.
(c) In the event that the Company shall decide to establish an advance
accrual reserve on its books against the future expense of payments from
any Participant, such reserve shall not under any circumstances be deemed
to be an asset of this Plan but, at all times, shall remain a part of the
general assets of the Company, subject to claims of the Company's
creditors.
(d) Participants, their legal representatives and their beneficiaries
shall have no right to anticipate, alienate, sell, assign, transfer, pledge
or encumber their interests in the Plan, nor shall such interests be
subject to attachment, garnishment, levy or execution by or on behalf of
creditors of the Participants or of their beneficiaries.
(e) Participants shall have no right, title, or interest whatsoever in
or to any investments which the Company may make to aid it in meeting its
obligations under the Plan. Nothing contained in the Plan, and no action
taken pursuant to its provisions, shall create a trust of any kind, or a
fiduciary relationship between the Company and any Participant,
beneficiary, legal representative or any other person. To the extent that
any person acquires a right to receive payments from the Company under the
Plan, such right shall be no greater than the right of an unsecured general
creditor of the Company. All payments to be made hereunder with respect to
a Participant shall be paid from the general funds of the Company employing
such Participant.
32
<PAGE>
Article XII
EFFECT ON EMPLOYMENT OR ENGAGEMENT
12.1 General
-------
Nothing contained in the Plan shall affect, or be construed as
affecting, the terms of employment or engagement of any Participant except to
the extent specifically provided herein. Nothing contained in the Plan shall
impose, or be construed as imposing, an obligation on the Company to continue
the employment or engagement of any Participant.
33
<PAGE>
Article XIII
GOVERNING LAW
13.1 General
-------
The Plan and all actions taken in connection with the Plan shall be
governed by and construed in accordance with the laws of the State of North
Carolina without reference to principles of conflict of laws, except as
superseded by applicable federal law.
* * *
34
William D. Johnson EXHIBIT 5
Senior Vice President and Corporate Secretary
Carolina Power & Light Company
411 Fayetteville Street
Raleigh, North Carolina 27602
October 25, 1999
Carolina Power & Light Company
411 Fayetteville Street
Raleigh, North Carolina 27601-6111
REGISTRATION STATEMENT ON FORM S-8
RELATING TO $ 3,940,000 OF DEFERRED COMPENSATION OBLIGATIONS TO BE ISSUED
PURSUANT TO THE CAROLINA POWER & LIGHT MANAGEMENT DEFERRED COMPENSATION PLAN
----------------------------------------------------------------------------
Ladies and Gentlemen:
I have acted as counsel to Carolina Power & Light Company, a North
Carolina corporation (the "Company"), in connection with the registration by the
Company of $ 3,940,000 of Deferred Compensation Obligations, which represent
unsecured obligations of the Company to pay deferred compensation in the future
in accordance with the terms of the Carolina Power & Light Management Deferred
Compensation Plan (the "Plan"), as set forth in the Registration Statement on
Form S-8 (the "Registration Statement") that is being filed on the date hereof
with the Securities and Exchange Commission (the "Commission") by the Company
pursuant to the Securities Act of 1933, as amended. The Obligations are to be
issued from time to time as set forth in the Registration Statement, the Plan
and any amendments or supplements thereto.
In rendering this opinion, I have examined the Plan and such other
records of the Company and certificates of its officers and of public officials
as I have deemed necessary.
Based upon the foregoing and the further qualifications stated below,
I am of the opinion that, when issued in accordance with the provisions of the
Plan, the Deferred Compensation Obligations constitute the valid and binding
obligations of the Company, enforceable against the Company in accordance with
their terms, except as may be limited or otherwise affected by (a) bankruptcy,
insolvency, reorganization, moratorium or other laws affecting the rights of
creditors generally and (b) principles of equity, whether considered at law or
in equity.
<PAGE>
Carolina Power & Light Company
October 25, 1999
Page 2
I hereby consent to the filing of this opinion with the Commission as
an exhibit to the Registration Statement.
Very truly yours,
/s/ William D. Johnson
EXHIBIT NO. 23.2
INDEPENDENT AUDITORS' CONSENT
We consent to the incorporation by reference in this Registration Statement of
Carolina Power & Light Company on Form S-8 of our report dated February 9, 1999,
appearing in the Annual Report on Form 10-K of Carolina Power & Light Company
for the year ended December 31, 1998.
/s/ DELOITTE & TOUCHE LLP
Raleigh, North Carolina
October 25, 1999
