UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D. C. 20549
FORM 11-K
[X] ANNUAL REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934 [NO FEE REQUIRED]
For the plan year ended December 31, 2000
-----------------
OR
[_] TRANSITION REPORT PURSUANT TO SECTION 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934 [NO FEE REQUIRED]
For the transition period from ______ to ______.
Commission file number 1-15929
-------
STOCK PURCHASE-SAVINGS PLAN
OF
PROGRESS ENERGY, INC.
---------------------
Full title plan and the address of the
plan, if different from that of the issuer named below
PROGRESS ENERGY, INC.
(a North Carolina corporation)
410 South Wilmington Street, Raleigh, North Carolina 27601-1748
---------------------------------------------------------------
Name of issuer of the securities held pursuant to the
plan and address of its principal executive office
STOCK PURCHASE-SAVINGS PLAN
OF PROGRESS ENERGY, INC.
TABLE OF CONTENTS
PAGE
----
Independent Auditors' Report ...................................................................... 3
Statement of Net Assets Available for Benefits, December 31, 2000.................................. 4
Statement of Changes in Net Assets Available for Benefits
For the Year Ended December 31, 2000............................................................. 5
Statement of Net Assets Available for Benefits, December 31, 1999.................................. 6
Statement of Changes in Net Assets Available for Benefits
For the Year Ended December 31, 1999............................................................. 7
Notes to Financial Statements...................................................................... 8-12
Schedule H, line 4i - Schedule of Assets (Held at End of Year)
As of December 31, 2000.......................................................................... 13
Schedule H, line 4j - Schedule of Reportable Transactions
For the Year Ended December 31, 2000............................................................. 14
2
INDEPENDENT AUDITORS' REPORT
Stock Purchase-Savings Plan of
Progress Energy, Inc.
We have audited the accompanying statements of net assets available for benefits
of the Stock Purchase-Savings Plan of Progress Energy, Inc. as of December 31,
2000 and 1999, and the related statements of changes in net assets available for
benefits for the years then ended. These financial statements are the
responsibility of the Plan's management. Our responsibility is to express an
opinion on these financial statements based on our audits.
We conducted our audits in accordance with auditing standards generally accepted
in the United States of America. Those standards require that we plan and
perform the audit to obtain reasonable assurance about whether the financial
statements are free of material misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in the financial
statements. An audit also includes assessing the accounting principles used and
significant estimates made by management, as well as evaluating the overall
financial statement presentation. We believe that our audits provide a
reasonable basis for our opinion.
In our opinion, such financial statements present fairly, in all material
respects, information regarding the Plan's net assets available for benefits at
December 31, 2000 and 1999, and the changes therein for the years then ended in
conformity with accounting principles generally accepted in the United States of
America.
Our audits were conducted for the purpose of forming an opinion on the basic
financial statements taken as a whole. The supplemental schedules of (1) assets
held for investment purposes as of December 31, 2000 and (2) reportable
transactions for the year ended December 31, 2000 are presented for the purpose
of additional analysis and are not a required part of the basic financial
statements, but are supplementary information required by the Department of
Labor's Rules and Regulations for Reporting and Disclosure under the Employee
Retirement Income Security Act of 1974. The supplemental information by fund in
the statements of net assets available for benefits and the statements of
changes in net assets available for benefits is presented for the purpose of
additional analysis rather than to present the net assets available for benefits
and changes in net assets available for benefits of the individual funds. The
supplemental schedules and supplemental information by fund is the
responsibility of the Plan's management. Such supplemental schedules and
supplemental information by fund have been subjected to the auditing procedures
applied in our audit of the basic financial statements and, in our opinion, are
fairly stated in all material respects when considered in relation to the basic
financial statements taken as a whole.
/s/ DELOITTE & TOUCHE LLP
Raleigh, North Carolina
June 25, 2001
3
STOCK PURCHASE-SAVINGS PLAN
OF PROGRESS ENERGY, INC.
Statement of Net Assets Available for Benefits
December 31, 2000
SUPPLEMENTAL INFORMATION
-------------------------------------------------------------------
ESOP COMMON STOCK PARTICIPANT
UNALLOCATED ALLOCATED TO PARTICIPANTS' DIRECTED
TOTAL PLAN TO PARTICIPANTS PARTICIPANTS LOANS INVESTMENTS
---------------- ------------------- --------------- ------------- ---------------
ASSETS
Investments:
Progress Energy, Inc. Common Stock $ 959,896,326 $ 284,420,620 $ 675,475,706 $ - $ -
Putnam New Opportunities Fund 41,163,382 - - - 41,163,382
American EuroPacific Growth Fund 16,145,526 - - - 16,145,526
Fidelity Equity - Income Fund 66,989,461 - - - 66,989,461
Fidelity Balanced Fund 10,961,827 - - - 10,961,827
AMEX Fixed Income Fund 17,461,547 - - - 17,461,547
Putnam Investors Large-Cap Growth Fund 10,647,595 - - - 10,647,595
Vanguard S&P 500 Index Fund 8,866,789 - - - 8,866,789
PIMCO Total Return Bond Fund 1,945,645 - - - 1,945,645
Participants' Loans Receivable 19,221,972 - - 19,221,972 -
---------------- ------------------- --------------- ------------- ---------------
Total Investments 1,153,300,070 284,420,620 675,475,706 19,221,972 174,181,772
Dividends/Capital Gains/Interest Receivable 10,351,691 3,064,659 7,278,315 - 8,717
Contributions Receivable 9,873,313 - 9,873,313 - -
Cash and Cash Equivalents 6,495,892 - 6,386,978 108,914 -
---------------- ------------------- --------------- ------------- ---------------
Total Assets 1,180,020,966 287,485,279 699,014,312 19,330,886 174,190,489
---------------- ------------------- --------------- ------------- ---------------
LIABILITIES
ESOP Loan Payable 147,679,302 147,679,302 - - -
Participants' Loans Payable 19,330,886 - - 19,330,886 -
Interest Payable - ESOP Loan 1,476,793 1,476,793 - - -
---------------- ------------------- --------------- ------------- ---------------
Total Liabilities 168,486,981 149,156,095 - 19,330,886 -
---------------- ------------------- --------------- ------------- ---------------
NET ASSETS AVAILABLE FOR BENEFITS $1,011,533,985 $ 138,329,184 $ 699,014,312 $ - $ 174,190,489
================ =================== =============== ============= ===============
See Notes to Financial Statements.
____________________________________________________________________________________________________________________________________
4
STOCK PURCHASE-SAVINGS PLAN
OF PROGRESS ENERGY, INC.
Statement of Changes in Net Assets Available for Benefits
For the Year Ended December 31, 2000
SUPPLEMENTAL INFORMATION
-----------------------------------------------------------
ESOP COMMON STOCK PARTICIPANT
UNALLOCATED ALLOCATED TO PARTICIPANTS' DIRECTED
TOTAL PLAN TO PARTICIPANTS PARTICIPANTS LOANS INVESTMENTS
---------- --------------- ------------ ------------- -----------
ADDITIONS TO NET ASSETS
Investment Income:
Dividends/Capital Gains $ 54,473,543 $ 12,136,629 $ 28,449,118 $ - $ 13,887,796
Net Apppreciation (Deoreciation) in Fair Value 342,362,817 109,414,220 258,536,615 - (25,588,018)
Interest 2,159,434 - 322,355 1,837,079 -
Contributions:
Employer 27,324,915 7,514,954 19,809,961 - -
Participants 30,362,364 - 15,602,698 - 14,759,666
-------------- -------------- ------------ ----------- ------------
Total Additions to Net Assets 456,683,073 129,065,803 322,720,747 1,837,079 3,059,444
-------------- -------------- ------------ ----------- ------------
DEDUCTIONS FROM NET ASSETS
Interest Expense 10,592,903 9,155,326 - 1,437,577 -
Allocation of Shares 18,739,367 18,739,367 - - -
Distribution of Benefits 48,233,585 - 35,687,643 - 12,545,942
Administrative Expense 458,046 - 663 399,502 57,881
-------------- -------------- ------------ ----------- ------------
Total Deductions from Net Assets 78,023,901 27,894,693 35,688,306 1,837,079 12,603,823
-------------- -------------- ------------ ----------- ------------
NET INCREASE (DECREASE) IN NET ASSETS 378,659,172 101,171,110 287,032,441 - (9,544,379)
NET TRANSFERS AMONG INVESTMENT
OPTIONS - - (14,519,019) - 14,519,019
NET ASSETS - DECEMBER 31, 1999 632,874,813 37,158,074 426,500,890 - 169,215,849
-------------- -------------- ------------ ----------- ------------
NET ASSETS - DECEMBER 31, 2000 $1,011,533,985 $ 138,329,184 $699,014,312 $ - $174,190,489
============== ============== ============ =========== ============
See Notes to Financial Statements.
_______________________________________________________________________________
5
STOCK PURCHASE-SAVINGS PLAN
OF PROGRESS ENERGY, INC.
Statement of Net Assets Available for Benefits
December 31, 1999
SUPPLEMENTAL INFORMATION
----------------------------------------------------------------------------
ESOP COMMON STOCK PARTICIPANT
UNALLOCATED ALLOCATED TO PARTICIPANTS' DIRECTED
TOTAL PLAN TO PARTICIPANTS PARTICIPANTS LOANS INVESTMENTS
---------- --------------- ------------ ------------- -----------
ASSETS
Investments:
Progress Energy, Inc. Common Stock $ 600,163,795 $ 193,745,767 $ 406,418,028 $ - $ -
Putnam New Opportunities Fund 34,912,650 - - - 34,912,650
American EuroPacific Growth Fund 14,906,890 - - - 14,906,890
Fidelity Equity - Income Fund 88,872,466 - - - 88,872,466
Fidelity Balanced Fund 13,020,666 - - - 13,020,666
AMEX Fixed Income Fund 17,503,177 - - - 17,503,177
Putnam Investors Large-Cap Growth Fund - - - - -
Vanguard S&P 500 Index Fund - - - - -
PIMCO Total Return Bond Fund - - - - -
Participants' Loans Receivable 20,592,584 - - 20,592,584 -
------------- ------------- ------------- ------------ -------------
Total Investments 789,972,228 193,745,767 406,418,028 20,592,584 169,215,849
Dividends/Capital Gains/Interest Receivable 10,154,722 3,278,162 6,876,560 - -
Contributions Receivable 7,711,673 - 7,711,673 - -
Cash and Cash Equivalents 5,607,033 207 5,494,629 112,197 -
------------- ------------- ------------- ------------ -------------
Total Assets 813,445,656 197,024,136 426,500,890 20,704,781 169,215,849
------------- ------------- ------------- ------------ -------------
LIABILITIES
ESOP Loan Payable 158,283,229 158,283,229 - - -
Participants' Loans Payable 20,704,781 - - 20,704,781 -
Interest Payable - ESOP Loan 1,582,833 1,582,833 - - -
------------- ------------- ------------- ------------ -------------
Total Liabilities 180,570,843 159,866,062 - 20,704,781 -
------------- ------------- ------------- ------------ -------------
NET ASSETS AVAILABLE FOR BENEFITS $ 632,874,813 $ 37,158,074 $ 426,500,890 $ - $ 169,215,849
============= ============= ============= ============ =============
See Notes to Financial Statements.
- ------------------------------------------------------------------------------------------------------------------------------------
6
STOCK PURCHASE-SAVINGS PLAN
OF PROGRESS ENERGY, INC.
Statement of Changes in Net Assets Available for Benefits
For the Year Ended December 31, 1999
SUPPLEMENTAL INFORMATION
-------------------------------------------------------------
ESOP COMMON STOCK PARTICIPANT
UNALLOCATED ALLOCATED TO PARTICIPANTS' DIRECTED
TOTAL PLAN TO PARTICIPANTS PARTICIPANTS LOANS INVESTMENTS
------------- --------------- -------------- ------------- -------------
ADDITIONS TO NET ASSETS
Investment Income:
Dividends/Capital Gains $ 53,598,920 $ 13,087,899 $ 26,260,144 $ - $ 14,250,877
Net Appreciation (Depreciation) in Fair Value (309,692,859) (110,220,765) (212,358,497) - 12,886,403
Interest 2,100,373 - 338,999 1,761,374 -
Contributions:
Employer 28,950,879 6,578,951 22,371,928 - -
Participants 27,697,357 - 14,496,426 - 13,200,931
------------- ------------- -------------- ---------- -------------
Total Additions to Net Assets (197,345,330) (90,553,915) (148,891,000) 1,761,374 40,338,211
------------- ------------- -------------- ---------- -------------
DEDUCTIONS FROM NET ASSETS
Interest Expense 11,026,734 9,774,531 - 1,252,203 -
Allocation of Shares 23,287,834 23,287,834 - - -
Distribution of Benefits 59,755,414 - 48,602,471 - 11,152,943
Administrative Expense 569,904 - 9,484 509,171 51,249
------------- ------------- -------------- ---------- -------------
Total Deductions from Net Assets 94,639,886 33,062,365 48,611,955 1,761,374 11,204,192
------------- ------------- -------------- ---------- -------------
NET INCREASE (DECREASE) IN NET ASSETS (291,985,216) (123,616,280) (197,502,955) - 29,134,019
NET TRANSFERS AMONG INVESTMENT OPTIONS - - 6,747,794 - (6,747,794)
NET ASSETS - DECEMBER 31, 1998 924,860,029 160,774,354 617,256,051 - 146,829,624
------------- ------------- -------------- ---------- -------------
NET ASSETS - DECEMBER 31, 1999 $ 632,874,813 $ 37,158,074 $ 426,500,890 $ - $ 169,215,849
============= ============= ============== ========== =============
See Notes to Financial Statements.
- --------------------------------------------------------------------------------
7
STOCK PURCHASE-SAVINGS PLAN
OF PROGRESS ENERGY, INC.
Notes to Financial Statements
Periods Ended December 31, 2000 and 1999
1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
The Stock Purchase-Savings Plan's (the "Plan") investments in the common stock
of Progress Energy, Inc. (the "Company"), the Putnam New Opportunities Fund, the
American EuroPacific Growth Fund, the Fidelity Equity-Income Fund, the Fidelity
Balanced Fund, the Putnam Investors Large-Cap Growth Fund, the Vanguard S&P 500
Index Fund and the PIMCO Total Return Bond Fund are carried at fair value
determined by quoted prices in an active market. The investment in the AMEX
Fixed Income Fund is carried at cost plus accrued appreciation (depreciation)
which approximates fair value. Participants' loans receivable are valued at
cost which approximates fair value.
Dividends, interest and other income are recognized as earned, and expenses are
accrued as incurred. Benefits are recorded when paid.
The expenses incurred by State Street Bank & Trust Company, N.A. (the
"Trustee"), Wachovia Bank of North Carolina, N.A. (the Trustee prior to February
1, 2000), and ADP, Inc., the third-party administrator, in the administration of
the Plan may be paid from assets of the Plan to the extent not paid by the
Company.
Cash and cash equivalents include funds invested in State Street's Short Term
Investment Fund (STIF) which is a money market fund (see Note 3). Prior to
February 1, 2000, such funds were invested in Wachovia's STIF.
The preparation of financial statements in conformity with generally accepted
accounting principles requires management to make estimates and assumptions that
affect the reported amounts of assets, liabilities, and changes therein, and
disclosure of contingent assets and liabilities. Actual results could differ
from those estimates.
2. DESCRIPTION OF THE PLAN
General Information Regarding the Plan
- --------------------------------------
The purposes of the Plan are to encourage systematic savings by employees and to
provide employees with a convenient method of acquiring an equity interest in
the Company and other investments. The notes which follow provide a high level
summary of Plan features. The Summary Plan Description and Prospectus for the
Plan should be consulted for Plan details and limitations.
Change in Plan Sponsor
- ----------------------
During 1999, the Plan Sponsor was Carolina Power & Light Company ("CP&L"). The
Company was formed as a result of the reorganization of CP&L into a holding
company structure on June 19, 2000. All shares of common stock of CP&L were
exchanged for an equal number of shares of the Company. Effective August 1,
2000, the Plan Sponsor changed to CP&L Energy, Inc. On December 4, 2000, the
Company changed its name from CP&L Energy, Inc. to Progress Energy, Inc.
Effective December 13, 2000, the name of the Plan changed from the Stock
Purchase-Savings Plan of Carolina Power & Light Company to the Stock Purchase-
Savings Plan of Progress Energy, Inc.
8
Participation in the Plan
- -------------------------
Generally, all full-time employees of CP&L and certain other specified
subsidiaries of the Company, who are at least 18 years of age, are eligible to
participate in the Plan on their first day of employment. Certain part-time
employees are also eligible. Only persons treated as employees of CP&L and
certain other specified subsidiaries of the Company for federal tax purposes may
participate in the Plan. Independent contractors, leased employees and contract
employees are not eligible. If employees wish to participate in the Plan, they
must elect to do so and must specify their level of savings and how their
savings should be allocated among the Plan's investment options. Retired
participants and former eligible employees of CP&L and certain other specified
subsidiaries of the Company, who are currently ineligible to participate, may
retain investments in the Plan but may not continue to make contributions.
Employee Contributions Under the Plan
- -------------------------------------
Employees who have eligible earnings equal to or less than a certain level
($85,000 for 2000 and $80,000 for 1999) may contribute up to 16%, in increments
of 1% for 2000 and 2% for 1999, of their annual eligible earnings (the "Deferred
Contribution"). Employees with earnings above this level may contribute up to
12% of their eligible earnings. These contributions reduce, in like amount, the
employee's earnings subject to income tax for that year. An employee's total
before-tax contributions were limited to $10,500 for 2000 and $10,000 for 1999.
Participating employees may also elect to contribute an additional amount on an
after-tax basis. Employees who have eligible earnings equal to or less than a
specified level ($85,000 for 2000 and $80,000 for 1999) may elect to contribute
an after-tax amount up to 16%, in increments of 1% for 2000 and 2% for 1999, of
their eligible earnings. Employees with earnings above this level may
contribute an amount up to 12% of their pay. These contributions are made
after-tax and are not matched by the Company. In no event may the before-tax
contributions plus the after-tax contributions exceed a total of 16% of annual
eligible earnings.
Company Contributions Under the Plan
- ------------------------------------
At the time employee contributions are made, the Company's matching allocations
are made to the Plan in an amount (the "Automatic SPSP Company-match") equal to
50% of the first 6% of each employee's before-tax contributions. All Company
matching allocations and any earnings on securities purchased with these
allocations are invested in common stock of the Company.
The Plan also has an incentive feature (the "Employee Stock Incentive Plan
Match") which provides for additional Company matching allocations to be made to
the Plan on behalf of each eligible employee when at least five out of ten of
the Company and business unit strategic goals set by senior management are met.
All employees eligible to participate in the Plan are eligible for these
additional Company matching allocations. Those eligible employees who do not
contribute to the Plan are, for the purpose of determining the Employee Stock
Incentive Plan Match, assumed to have made a before-tax contribution of 2% to
the Plan. The Company made Employee Stock Incentive Plan Matching allocations
of $9.9 million for the Plan year ended December 31, 2000 and $7.7 million for
the Plan year ended December 31, 1999.
Employees are 100 percent vested in the contributions they have made to the Plan
and 100 percent vested in the investment earnings credited on such
contributions. Upon attaining five years of service with the Company, employees
are 100 percent vested in all Company matches that have been made to their
accounts. Employees with less than five years of service will be vested in the
Automatic SPSP Company-match and the Employee Stock Incentive Plan Match at the
end of the second Plan year after the year in which the matching allocations and
the additional matching allocations were allocated to the employees' accounts.
9
Employee Stock Ownership Plan
- -----------------------------
In 1989, the Plan was restated as an Employee Stock Ownership Plan, which allows
the Plan to enter into acquisition loans ("ESOP Loans") for the purpose of
acquiring Company common stock. Common stock acquired with the proceeds of an
ESOP Loan is held by the Trustee in a suspense account ("ESOP Stock Suspense
Account"). Such common stock is released from the ESOP Stock Suspense Account
and made available for allocation to the accounts of participants as the ESOP
Loan is repaid as specified by provisions of the Internal Revenue Code.
ESOP Loan payments are made quarterly and may be funded by dividends on stock
held in the ESOP Stock Suspense Account, dividends on Company stock held in the
Progress Energy, Inc. Common Stock Fund, Company contributions or the proceeds
of stock sold from the ESOP Stock Suspense Account.
In October 1989, the Trustee purchased 13,636,362 shares of common stock (as
restated for the two-for-one stock split in February 1993) from the Company for
an aggregate purchase price of approximately $300 million. The purchase was
financed with a long-term ESOP Loan from the Company, bearing a 6% interest
rate. Prepayment of the loan without a penalty is allowed. Excluding the
effects of any future prepayments, required payments, including principal and
interest, are $19,865,293 for each of the years 2001 through 2005 and a total of
$97,707,531 from 2006 through 2010. The ESOP Loan is secured by the ESOP Stock
Suspense Account shares in the Plan, which totaled 5,782,376 shares at December
31, 2000. During the 2000 Plan year, 582,988 ESOP shares were released from the
ESOP Stock Suspense Account and allocated to participants.
Progress Energy, Inc. Common Stock Fund
- ---------------------------------------
The Progress Energy, Inc. Common Stock Fund is partially funded through the
release of shares from the ESOP Stock Suspense Account. The price at which such
released shares are allocated to Plan participants is the closing price per
share on the payroll date. In addition, the Progress Energy, Inc. Common Stock
Fund may use available cash from contributions and dividends to purchase
Progress Energy, Inc. common stock on the open market or otherwise, including
purchases from the Company of authorized but unissued shares of common stock.
The purchase price of shares of common stock acquired on the open market for
employee accounts will be the weighted average price of all shares purchased
under the Plan during the applicable Investment Period which is generally one
pay period, running from the payroll date deductions are taken to the date
before the following payroll date. If funds to be invested in Company common
stock are used to purchase authorized but unissued common stock directly from
the Company, the purchase price will be the closing price per share on the date
of purchase. No brokerage commission or other charges shall be deducted.
The Progress Energy, Inc. Common Stock Fund was converted from share to unitized
accounting effective January 1, 1999. This changeover required a conversion of
a small portion of this fund into a cash reserve in order to provide the
liquidity necessary to process daily fund transactions by the close of market
each business day. The cash reserve generally represents between 1 and 3 percent
of the total fund value, and varies depending upon account activity. The
reserve may consist of cash or cash equivalents. As of December 31, 2000 and
December 31, 1999, the reserve totaled approximately $6.4 million and $5.5
million, respectively.
Investment of Funds
- -------------------
At the election of the participating employee, contributions made by the
employee and any earnings on the securities purchased with these contributions
are invested in the investment options listed on the Statement of Net Assets
Available for Benefits. Employee contributions to the Plan can be allocated to
one or more of the investment options in increments of 1% for 2000 and 2% for
1999; however, a minimum of 25% of the first 6% of Deferred Contributions must
be invested in Company common stock. This election is made at the time the
employee begins to participate in the Plan. The election may be changed upon
request and is generally effective by the following pay period. A participant
may transfer current fund balances among the Plan options subject to certain
limitations. All Company matching allocations and any dividends on stock
purchased with Company matching allocations will be invested in common stock of
the Company.
10
For employees age 55 and older who have participated in the Plan for at least 10
years, the Company offers diversification of a portion of a participant's
accumulated investment in Company common stock acquired after 1986. Qualified
participants can elect annually, for a maximum of six years, to transfer to one
or more of the remaining investment options up to 25% (50% in the final year of
election) of 1) Company common stock acquired by the participant, 2) Company
matching allocations and 3) dividends on Company common stock accrued after
1986. At retirement, all contributions made by the participant in Company
common stock may be diversified.
Retirement, Death, or Termination of Employment
- -----------------------------------------------
Participants with five or more years of service with CP&L and certain other
specified subsidiaries of the Company are vested with respect to all Company
matching allocations. Generally, participants leaving the employ of the Company
with less than five years of service forfeit non-vested Company matching
allocations and reinvested earnings on those allocations. In the case of an
employee's death, retirement or termination of employment with at least five
years of service with the Company, all employee and Company matching
allocations, including those otherwise non-vested, become payable upon request
by the employee, the employee's estate or other appropriate recipients.
Forfeited matching allocations are used by the Plan to reduce future matching
allocations otherwise required from the Company. These forfeited matching
allocations and associated reinvested earnings were $464,100 in 2000 and
$364,590 in 1999. As of December 31, 2000, $2.3 million had been approved for
payment to withdrawing participants, but had not been paid as of that date.
Withdrawals
- -----------
Participants may withdraw certain funds while employed at CP&L and certain other
specified subsidiaries of the Company. Such withdrawals will be applied to the
participant's account based on the fund withdrawal hierarchy prescribed by the
Plan (participants cannot direct that the withdrawal be applied to a specific
fund). In general, withdrawals of before-tax contributions - whether the
contributions were from the employee or from the Company - and their earnings
are not permitted unless a penalty is paid. However, under certain specified
circumstances, the IRS will allow limited withdrawals of before-tax
contributions. Financial hardship withdrawals are permitted when an employee has
a substantiated "immediate and heavy" financial need. Once reaching age 59 1/2,
employees may make a non-hardship withdrawal of before-tax contributions without
having to meet the hardship requirements.
Loans
- -----
Participants are allowed to borrow against their accounts while continuing to
defer taxes on the amount of the loan. The tax deferral is preserved as long as
the principal and interest on the loan are repaid as due. The minimum loan
available is $1,000. The maximum is 50 percent of the participant's account
balance or $50,000, whichever is smaller. Loans are available in increments of
$100 only. The interest rate for loans is determined periodically by the Plan's
Committee, and is set at a reasonable amount in accordance with IRS regulations.
Interest rates ranged from 8.75% to 10.00% during 2000 and from 8.25% to 8.75%
during 1999. For active employees, loan repayment is made through automatic
payroll deduction of after-tax dollars. Loans from the Plan must be repaid
within five years or when employment is terminated, whichever happens first. The
loans are funded with a borrowing arrangement by the Plan with an outside
lending institution. The borrowings bear interest at the One-month London
InterBank Offering Rate (LIBOR). For 2000 and 1999, the LIBOR averaged 6.41%
and 5.25%, respectively.
11
Federal Income Taxes
- --------------------
The Plan obtained its latest determination letter on May 16, 1996, in which the
Internal Revenue Service stated that the Plan and Trust, as then designed, was
in compliance with the applicable requirements of the Internal Revenue Code.
The Plan has been amended and restated since receiving the determination letter.
However, the Plan administrator believes that the Plan is currently designed and
being operated in compliance with the applicable requirements of the Internal
Revenue Code. Therefore, it is believed that the Plan was qualified and the
related trust was tax-exempt as of the financial statement date. No provision
for income taxes has been included in the Plan's financial statements.
Termination of the Plan
- -----------------------
The Company has reserved the right to amend, modify, suspend or terminate the
Plan at any time, except that no such action will have a retroactive effect and
none of the assets of the Plan will revert to the Company or be used for any
purpose other than the exclusive benefit of the participating employees,
provided that, in the event of Plan termination, shares of Company common stock
not allocated to participants' accounts may be sold to repay the ESOP Loans. In
the event of termination of the Plan, all contributions of the participants and
of the Company through the date of termination will be vested.
3. RELATED PARTY TRANSACTIONS
Plan investments at end of period include shares of money market funds managed
by State Street Bank, the Trustee as defined by the Plan, and therefore qualify
as party-in-interests transactions.
12
STOCK PURCHASE-SAVINGS PLAN
OF PROGRESS ENERGY, INC.
Schedule H, line 4i - Schedule of Assets (Held at End of Year)
As of December 31, 2000
- ------------------------------------------------------------------------------------------------------------------------------
Identity of Issue Description of Investment Cost Value Fair Value
- ------------------------------------------------------------------------------------------------------------------------------
Progress Energy, Inc. Common Stock Common stock, no par or $464,255,857 $ 959,896,326 *
stated value, 19,515,046 shares
Putnam New Opportunities Fund Mutual fund - 702,207 shares 49,099,115 41,163,382
American EuroPacific Growth Fund Mutual fund - 515,009 shares 17,679,474 16,145,526
Fidelity Equity-Income Fund Mutual fund - 1,253,780 shares 53,599,434 66,989,461
Fidelity Balanced Fund Mutual fund - 721,648 shares 10,899,017 10,961,827
AMEX Fixed Income Fund Mutual Fund - 320,687 shares 15,114,615 17,461,547
Putnam Investors Large-Cap Growth Fund Mutual Fund - 693,203 shares 12,730,710 10,647,595
Vanguard S&P 500 Index Fund Mutual Fund - 72,762 shares 9,614,284 8,866,789
PIMCO Total Return Bond Fund Mutual Fund - 187,261 shares 1,893,403 1,945,645
Participants' Loans Receivable Loans to plan participants 19,221,972 19,221,972 *
------------ --------------
Total $654,107,881 $1,153,300,070
============ ==============
* Party in interest
13
STOCK PURCHASE-SAVINGS PLAN
OF PROGRESS ENERGY, INC.
Schedule H, line 4j - Schedule of Reportable Transactions
For the Year Ended December 31, 2000
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Expenses Current Value on
Identity of Party/Description of Asset Purchase Price Selling Price Incurred Cost Value Transaction Date Gain/Loss
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State Street
Progress Energy, Inc. Common Stock Fund:
113 Purchases $71,726,490 - - $71,726,490 $ 71,726,490 -
217 Sales - $66,571,047 - $58,906,448 $ 66,571,047 $7,664,599
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330 Transactions $138,297,537
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14
SIGNATURES
The Plan. Pursuant to the requirements of the Securities Exchange Act of 1934,
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the Stock Purchase-Savings Plan Committee has duly caused this Annual Report to
be signed on its behalf by the undersigned hereunto duly authorized.
STOCK PURCHASE-SAVINGS PLAN OF
PROGRESS ENERGY, INC.
/s/ Brenda F. Castonguay, Chairperson
-------------------------------------
Brenda F. Castonguay, Chairperson
Stock Purchase-Savings Plan Committee
Date: June 22, 2001
EXHIBITS INDEX
Exhibit Number
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Exhibit No. 23 Consent of Deloitte & Touche LLP