EXECUTION COPY



                              ASSUMPTION AGREEMENT

                                                                  August 5, 2002

To Citibank, N.A., as Administrative
Agent under the Credit Agreement
referred to below

Ladies and Gentlemen:

     We make reference to the  (three-year)  Credit  Agreement and the (364-day)
Credit  Agreement,  each dated as of July 31,  2002  (collectively,  the "Credit
Agreements"), among Carolina Power & Light Company (the "Borrower"), the lenders
named therein and Citibank,  N.A., as Administrative Agent. Terms defined in the
Credit Agreement are used herein as defined therein.

     The Borrower and The Bank of New York (the  "Assuming  Lender") each hereby
agree as follows:

1.   The  Assuming  Lender  proposes  to become an Assuming  Lender  pursuant to
     Section 2.04(b) of Each Credit  Agreement and, in that  connection,  hereby
     agrees with the Administrative  Agent and the Borrower that it shall become
     a Lender with a  Commitment  of  $12,500,000  for all  purposes  under each
     Credit Agreement on the applicable Commitment Increase Date.

2.   The Assuming  Lender (a) confirms that it has received copies of the Credit
     Agreements, together with copies of the financial statements referred to in
     Section  4.01(e) thereof and such other documents and information as it has
     deemed  appropriate  to make its own credit  analysis and decision to enter
     into this Assumption Agreement;  (b) agrees that it will, independently and
     without  reliance  upon the  Administrative  Agent or any other  Lender and
     based on such documents and information as it shall deem appropriate at the
     time,  continue  to make its own credit  decisions  in taking or not taking
     action  under the  Credit  Agreements;  (c)  appoints  and  authorizes  the
     Administrative  Agent to take  such  action as agent on its  behalf  and to
     exercise  such powers and  discretion  under the Credit  Agreements  as are
     delegated to the Administrative  Agent by the terms thereof,  together with
     such powers and discretion as are reasonably  incidental  thereto;  and (d)
     agrees  that it will  perform in  accordance  with  their  terms all of the
     obligations  that by the terms of the Credit  Agreements are required to be
     performed by it as a Lender.

3.   Following the execution hereof, this Assumption Agreement will be delivered
     to  the   Administrative   Agent  for   acceptance  and  recording  by  the
     Administrative Agent. The effective date for this Assumption Agreement (the
     "Effective Date") shall be the applicable Commitment Increase Date.

4.   Upon satisfaction of the applicable conditions set forth in Section 2.04(b)
     of each Credit  Agreement  and upon such  acceptance  and  recording by the
     Administrative  Agent,  as of the Effective Date, the Assuming Lender shall
     be a  party  to the  Credit  Agreements  and  have  all of the  rights  and
     obligations of a Lender thereunder.

5.   This Assumption Agreement shall be governed by, and construed in accordance
     with, the law of the State of New York.

6.   This Assumption Agreement may be executed in any number of counterparts and
     by different parties hereto in separate counterparts, each of which when so
     executed  shall be deemed to be an original and all of which taken together
     shall  constitute  one and the  same  agreement.  Delivery  of an  executed
     counterpart of the Assumption  Agreement by Facsimile shall be effective as
     delivery of a manually executed counterpart of this Assumption Agreement.

IN   WITNESS  WHEREOF,  the Borrower  and the  Assuming  Lender have caused this
     letter  to be duly  executed  and  delivered  as of the  date  first  above
     written.

                                       Very truly yours,

                                       CAROLINA POWER & LIGHT COMPANY



                                       By /s/ Thomas R. Sullivan
                                          --------------------------------------
                                          Name:      Thomas R. Sullivan
                                          Title:     Treasurer

                                       THE BANK OF NEW YORK



                                       By /s/ Jesus Williams
                                          --------------------------------------
                                          Name:      Jesus Williams
                                          Title:     Assistant Vice President
Accepted this 5th day of
  August 2002:

CITIBANK, N.A.,
As Administrative Agent



By________________________________
     Name:
     Title:



<PAGE>



                                                                  EXECUTION COPY



                          NOTICE OF COMMITMENT INCREASE


                                                                  August 5, 2002


 Ladies and Gentlemen:

     We refer to the  (364-day)  Credit  Agreement and the  (three-year)  Credit
Agreement,   each  dated  as  of  July  31,  2002  (collectively,   the  "Credit
Agreements"), among Carolina Power & Light Company (the "Borrower"), the lenders
named therein and Citibank, N.A., as Administrative Agent (the "Agent").  Unless
otherwise defined herein,  capitalized terms used herein shall have the meanings
ascribed to them in the Credit Agreements.

     Pursuant to Section  2.04(b) of each Credit  Agreement,  we hereby  provide
notice to you of a proposed Commitment Increase under each Credit Agreement. The
Bank of New York has indicated to the Borrower that it wishes to  participate in
the  facilities  under each  Credit  Agreement  and  thereby  become an Assuming
Lender.  The Bank of New York has  indicated to the  Borrower  that it wishes to
participate in the facilities  under each Credit Agreement and thereby become an
Assuming  Lender.  The Bank of New York proposes to  participate  in each Credit
Agreement in the amount of $12,500,000  thus increasing the aggregate  amount of
the  Commitments  to  $285,000,000  under each Credit  Agreement as of August 8,
2002, which will be the Commitment Increase Date.


                                       Very truly yours,

                                       CITIBANK, N.A.



                                       By /s/ Anita J. Brickell
                                          --------------------------------------
                                          Name:      Anita J. Brickell
                                          Title:     Vice President