**Amended
      and Restated**


**Progress
      Energy, Inc.**


**Restoration
      Retirement Plan**




Carolina
      Power & Light Company established the Carolina Power & Light Company
      Restoration Retirement Plan (the “Plan”), effective as of January 1, 1998
      (“Effective Date”), which was subsequently amended and restated as of January 1,
      1999, January 1, 2000, July 10, 2002 and January 1, 2005. The Sponsor hereby
      amends and restates the Plan effective as of January 1, 2007. The terms of
      the
      amended and restated Plan shall govern the payment of any benefits commencing
      after January 1, 2007.




ARTICLE
      I




PURPOSE




The
      purpose of the Plan is to provide a means by which certain employees may be
      provided benefits which otherwise would be provided under the Retirement Plan,
      in the absence of certain restrictions imposed by applicable law on benefits
      which may be provided under the Retirement Plan. The Plan is intended to
      constitute a nonqualified deferred compensation plan that complies with the
      provisions of Section 409A of the Code. Accordingly, the Plan and all Plan
      benefits shall be administered in accordance with Section 409A, related
      regulations and other guidance (“Section 409A”), notwithstanding any provisions
      of the Plan to the contrary. The Plan also is intended to constitute an unfunded
      retirement plan for 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.




ARTICLE
      II




DEFINITIONS




Capitalized
      terms which are not defined herein shall have the meaning ascribed to them
      in
      the Retirement Plan.




2.1  “Actuarial
      Value” shall mean an equivalent lump sum value as of the Benefit Commencement
      Date using the average 30-year Treasury Rate for the month of August immediately
      preceding the calendar year the determination is made and the GAR 94 mortality
      table (50% male, 50% female).




2.2  “Affiliated
      Company” shall mean any corporation or other entity that is required to be
      aggregated with the Sponsor pursuant to Sections 414(b), (c), (m), or (o) of
      the
      Code, but only to the extent so required.




2.3  “Benefit
      Commencement Date” shall mean the first day of the month following the
      Termination of the Participant. Notwithstanding the foregoing, payments with
      respect to a Participant who is a Key Employee shall not begin earlier than
      the
      date that is six months after the date of Termination of the Participant (or,
      if
      earlier, the date of death).







2.4  “Board”
      shall mean the Board of Directors of the Sponsor.




2.5  “Change
      in Control” shall occur on the earliest of the following dates:




(a)  the
      date
      any person or group of persons (within the meaning of Section 13(d) or 14(d)
      of
      the Securities Exchange Act of 1934), excluding employee benefit plans of the
      Sponsor, becomes, directly or indirectly, the “beneficial owner” (as defined in
      Rule 13d-3 promulgated under the Securities Act of 1934) of securities of the
      Sponsor representing twenty-five percent (25%) or more of the combined voting
      power of the Sponsor’s then outstanding securities (excluding the acquisition of
      securities of the Sponsor by an entity at least eighty percent (80%) of the
      outstanding voting securities of which are, directly or indirectly, beneficially
      owned by the Sponsor); or




(b)  the
      date
      of consummation of a tender offer for the ownership of more than fifty percent
      (50%) of the Sponsor’s then outstanding voting securities; or




(c)  the
      date
      of consummation of a merger, share exchange or consolidation of the Sponsor
      with
      any other corporation or entity regardless of which entity is the survivor,
      other than a merger, share exchange or consolidation which would result in
      the
      voting securities of the Sponsor outstanding immediately prior thereto
      continuing to represent (either by remaining outstanding or being converted
      into
      voting securities of the surviving or acquiring entity) more than sixty percent
      (60%) of the combined voting power of the voting securities of the Sponsor
      or
      such surviving or acquiring entity outstanding immediately after such merger
      or
      consolidation; or




(d)  the
      date,
      when as a result of a tender offer or exchange offer for the purchase of
      securities of the Sponsor (other than such an offer by the Sponsor for its
      own
      securities), or as a result of a proxy contest, merger, share exchange,
      consolidation or sale of assets, or as a result of any combination of the
      foregoing, individuals who are Continuing Directors cease for any reason to
      constitute at least two-thirds (2/3) of the members of the Board;
      or




(e)  the
      date
      the shareholders of the Sponsor approve a plan of complete liquidation or
      winding-up of the Sponsor or an agreement for the sale or disposition by the
      Sponsor of all or substantially all of the Sponsor’s assets; or




(f)  the
      date
      of any event which the Board determines should constitute a Change in
      Control.




A
      Change
      in Control shall not be deemed to have occurred until a majority of the members
      of the Board receive written certification from the Committee on Organization
      and Compensation of the Board that such event has occurred. Any determination
      that such an event has occurred shall, if made in good faith on the basis of
      information available at that time, be conclusive and binding on the Board,
      the
      Sponsor, the Company, the Participants and their beneficiaries for all purposes
      of the Plan.




2.6  “Code”
      shall mean the Internal Revenue Code of 1986, as amended.







2.7  “Committee”
      shall mean a committee selected by the Plan Administrator to hear claim disputes
      under Article IV of the Plan.




2.8  “Company”
      shall mean Progress Energy, Inc. or any successor to it in the ownership of
      substantially all of its assets and each Affiliated Company that, with the
      consent of the Board, adopts the Plan and is included in Appendix
      A ,
      as in
      effect from time to time. Appendix A shall set forth any limitations imposed
      on
      employees of Affiliated Companies that adopt the Plan including any limitations
      on benefit accruals, notwithstanding any provision in the Plan to the contrary.




2.9  “Compensation
      and Benefit Limitations” shall mean (a) the limitation on compensation under the
      Retirement Plan in accordance with Section 401(a)(17) of the Code and (b) any
      limits on benefits paid under the Retirement Plan that are necessary for
      compliance with Section 415 of the Code.




2.10  “Continuing
      Directors” shall mean the members of the Board as of January 1, 2007; provided,
      however, that any person becoming a director subsequent to such date whose
      election or nomination for election was supported by 75 percent or more of
      the
      directors who then comprised Continuing Directors shall be considered to be
      a
      Continuing Director.




2.11  “Deferrals”
      shall mean a Participant's deferrals of compensation under the MDCP to the
      extent not utilized in calculating a Participant's Accrued Benefit under the
      Retirement Plan.




2.12  “Eligible
      Employee” shall mean any member of the Retirement Plan who is not a Participant
      in the Sponsor's Supplemental Senior Executive Retirement Plan and who has
      not
      retired or terminated his or her employment with the Company prior to the
      Effective Date.




2.13  “Key
      Employee” shall mean a Participant who is a “key employee” as defined in Section
      416(i) of the Code, but determined without regard to paragraph 5 thereof or
      the
      50 employee limit on the number of officers treated as key
      employees.




2.14  “MDCP”
      shall mean the Progress Energy, Inc. Amended and Restated Management Deferred
      Compensation Plan.




2.15  “Participant”
      shall mean an Eligible Employee who participates in the Plan pursuant to Article
      III. An Eligible Employee shall remain a Participant under the Plan until the
      earlier of (a) all amounts payable on his or her behalf under the Plan have
      been
      paid, (b) the Eligible Employee no longer has a Restoration Accrued Benefit,
      (c)
      the Eligible Employee has a Termination without a Vested Restoration Accrued
      Benefit, or (d) the Eligible Employee becomes a Participant in the Sponsor’s
      Supplemental Senior Executive Retirement Plan.




2.16  “Restoration
      Accrued Benefit” shall mean, as of any determination date, the excess of (a) a
      Participant’s Accrued Benefit calculated under the Retirement Plan
      (1) assuming a Participant’s Compensation under the Retirement Plan
      includes Deferrals of a Participant and (ii) without regard to the Compensation
      and Benefit Limitations, over (b) a Participant’s Accrued Benefit calculated
      under the Retirement Plan. For purposes of this Section 2.16, a Participant's
      Accrued Benefit for purposes of clauses (a) and (b) above shall be calculated
      in
      the form of a Single Life Annuity for a Participant who does not have a Spouse
      and in the form of a 50% Qualified Joint and Survivor Annuity for a Participant
      who has a Spouse, with such calculation performed without regard to any other
      form of benefit elected by a Participant under the Retirement Plan.







2.17  “Retirement
      Plan” shall mean the Progress Energy Pension Plan, as it may be amended from
      time to time, or any successor plan.




2.18  “Sponsor”
      shall mean Progress Energy, Inc.




2.19  “Spouse”
      shall mean the spouse of a Participant as would be determined at the applicable
      time under the definition of Spouse in the Retirement Plan (or any successor
      provisions).




2.20  “Termination”
      shall mean “separation from service,” as defined for purposes of Section
      409A.




2.21  “Vested
      Restoration Accrued Benefit” shall mean a Participant’s Restoration Accrued
      Benefit when the Participant becomes fully vested under the provisions of the
      Retirement Plan (or any successor provisions) or as provided in Article VI
      of
      the Plan.




Unless
      the context clearly indicates to the contrary in interpreting the Plan, any
      references to the masculine alone shall include the feminine and the singular
      shall include the plural.




ARTICLE
      III




PARTICIPATION
      AND BENEFITS




3.1  Participation .
      An
      Eligible Employee will participate in the Plan when he or she has a Restoration
      Accrued Benefit.




3.2  Amount
      of Benefit Payable .
      Subject
      to the forfeiture provisions of Section 3.4 and lump sum payment provisions
      of
      Section 3.5 of the Plan, a Participant who becomes eligible for the payment
      of a
      benefit under the Retirement Plan, shall be entitled to monthly benefit payments
      commencing as of his Benefit Commencement Date or as soon thereafter as
      practicable based on the Participant’s Restoration Accrued Benefit calculated
      immediately prior to the Benefit Commencement Date and actuarially adjusted
      as
      if an annuity were being paid under the Retirement Plan as of the Benefit
      Commencement Date. The monthly payment shall be in the form of a Single Life
      Annuity if the Participant has no Spouse and in the form of a 50% Joint and
      Survivor Annuity if the Participant has a Spouse, with the Spouse determined
      at
      the Benefit Commencement Date entitled to any survivor benefit upon the death
      of
      the Participant.




3.3  Pre-Retirement
      Death Benefit .
      Subject
      to the provisions of Section 3.5, if a surviving Spouse of a deceased
      Participant would have been eligible for a pre-retirement death benefit under
      the Retirement Plan ( *i.e.* ,
      the
      Spouse being married to the Participant for a one-year period prior to the
      date
      of death), then upon such Participant’s death, such Spouse shall be entitled to
      a monthly benefit payment under the Plan equal to the amount, if any, by which
      (a) exceeds (b) each month, where (a) is the Spouse’s monthly death benefit that
      would be payable in accordance with the provisions of the Retirement Plan
      determined as if (i) the Participant’s Compensation under the Retirement Plan
      included Deferrals and (ii) the Compensation and Benefit Limitations did not
      apply, and (b) is the monthly death benefit payable under the Retirement
      Plan, and assuming for purposes of clauses (a) and (b) that the Spouse elected
      a
      monthly annuity as a death benefit under the Retirement Plan commencing on
      the
      same date as the pre-retirement death benefit is payable to the Spouse under
      this Plan. The pre-retirement death benefit under this Plan shall commence
      as of
      the first day of the month following the Participant’s death or as soon
      thereafter as practicable, and shall continue on the first day of the each
      month
      thereafter for the life of the Spouse.







3.4  Other
      Termination of Employment; Forfeitures .
      Neither
      Eligible Employees, Participants nor their Spouses or Beneficiaries are entitled
      to any benefits under the Plan except as otherwise provided in this Article
      III
      and under Article VI of the Plan. Any Participant who terminates employment
      with
      the Sponsor and any of its Affiliated Companies without being 100% vested under
      the Retirement Plan shall not be eligible to receive any benefits under the
      Plan
      and shall forfeit his or her Restoration Accrued Benefit. Any Participant
      ceasing to be an Eligible Employee because he or she becomes a Participant
      in
      the Supplemental Senior Executive Retirement Plan shall forfeit his or her
      Restoration Accrued Benefit.




Notwithstanding
      any other provision of the Plan, no benefit shall be payable under the Plan
      with
      respect to an Eligible Employee whose employment with the Sponsor or any of
      its
      Affiliated Companies is terminated for Cause. As used herein, the term “Cause”
shall be limited to (a) action by the Eligible Employee involving willful
      malfeasance having a material adverse effect on the Sponsor or any of its
      Affiliated Companies (b) substantial and continuing willful refusal by the
      Eligible Employee to perform the duties ordinarily performed by an employee
      in
      the same position and having similar duties as the Eligible Employee, (c) the
      Eligible Employee being convicted of a felony, or (d) willful failure to comply
      with the Sponsor or the applicable Affiliated Company's Code of Conduct or
      other
      Policy or Procedure.




3.5  Lump
      Sum Payments .
      The
      Committee shall provide for the payment under the Plan of a cash lump sum amount
      in lieu of the annuity otherwise payable under Sections 3.2 or 3.3, if the
      annuity amount to be paid is less than $500 per month. For a Participant (or
      spouse) whose benefit under the Retirement Plan is based upon the Participant’s
      Cash Balance Account, the lump sum shall be equal to what the Restoration
      Accrued Benefit would be if “Cash Balance Account” were substituted for “Accrued
      Benefit” in Section 2.15 and Restoration Accrued Benefit referred to a dollar
      amount. For a Participant (or spouse) whose benefit under the Retirement Plan
      is
      based on the Final Average Pay Formula Pension, the lump sum shall be equal
      to
      the Actuarial Value of the annuity payments that would otherwise be made to
      the
      Participant (or spouse) under Sections 3.2 or 3.3, as the case may be.
      Notwithstanding the foregoing, no lump sum payment shall be made under the
      Plan
      unless (i) the payment accompanies the termination of the entirety of the
      Participant’s interest in the Plan; (ii) the payment is made on or before the
      later of (A) December 31 of the calendar year in which the Termination of the
      Participant occurs, or (B) the date that is 2 1⁄2 months after the Termination of
      the Participant; and (iii) the payment is not greater than $75,000.










3.6  Payments
      to Key Employees .
      In the
      event the Benefit Commencement Date under this Plan of a Participant who is
      a
      Key Employee shall be delayed for six months following the Termination of the
      Participant as provided in Section 2.3, the Participant (if then living) shall
      receive a lump sum payment as of the first day of the seventh month following
      the Termination in an amount equal to six times the monthly payment due to
      the
      Participant under this Plan, in addition to the monthly payment then due to
      the
      Participant. If the Participant dies following Termination but prior to the
      commencement of payments under this Plan, the Participant’s surviving Spouse, if
      any, shall be entitled to receive the same death benefit payable in the event
      the Participant had commenced receiving benefit payments as of the first day
      of
      the month prior to his death.




ARTICLE
      IV




PLAN
      ADMINISTRATION




4.1  Administration .
      The
      Plan shall be administered by the Sponsor's Vice President, Human Resources
      (the
“Plan Administrator”). The Plan Administrator and the Committee shall have full
      authority to administer and interpret the Plan, determine eligibility for
      benefits, make benefit payments and maintain records hereunder, all in their
      sole and absolute discretion, subject to the allocation of responsibilities
      set
      forth below.




4.2  Delegated
      Responsibilities .
      The
      Plan Administrator shall have the authority to delegate any of his or her
      responsibilities to such persons as he or she deems proper.




4.3  Claims .




(a)  Claims
      Procedure .
      If any
      Participant, Spouse or Beneficiary has a claim for benefits which is not being
      paid, such claimant may file with the Plan Administrator a written claim setting
      forth the amount and nature of the claim, supporting facts, and the claimant’s
      address. The Plan Administrator 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 claim review procedure
      under the Plan.




(b)  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 to the Plan provisions on which the decision is based.
      The decision of the Committee shall be final and binding on all
      parties.







ARTICLE
      V




MISCELLANEOUS




5.1  Amendment
      and Termination .
      The
      Board may amend, modify or terminate the Plan at any time, provided, however,
      that no such amendment or termination shall reduce any Participant’s Vested
      Restoration Accrued Benefit under the Plan as of the date of such amendment
      or
      termination, unless at the time of such amendment or termination, affected
      Participants and spouses become entitled to an amount equal to the equivalent
      actuarial value, to be determined in the sole discretion of the Committee,
      of
      such Vested Restoration Accrued Benefit under another plan, program or practice
      adopted by a Company. In the event the Plan is terminated, the Sponsor shall
      pay
      the Vested Restoration Accrued Benefits in accordance with the terms of the
      Plan
      as in effect prior to such termination except as otherwise provided in Section
      6.4.




5.2  Source
      of Payments .
      Each
      Company will pay with respect to its own Eligible Employees all benefits arising
      under the Plan and all costs, charges and expenses relating thereto out of
      its
      general assets.




5.3  Non-Assignability
      of Benefits .
      Except
      as otherwise required by law, neither any benefit payable hereunder nor the
      right to receive any future benefit under the Plan may be anticipated,
      alienated, sold, transferred, assigned, pledged, encumbered, or subjected to
      any
      charge or legal process, and if any attempt is made to do so, or a person
      eligible for any benefits under the Plan becomes bankrupt, the interest under
      the Plan of the person affected may be terminated by the Plan Administrator
      which, in his or her sole discretion, may cause the same to be held or applied
      for the benefit of one or more of the dependents of such person or make any
      other disposition of such benefits that it deems appropriate.




5.4  Plan
      Unfunded .
      Nothing
      in the Plan shall be interpreted or construed to require a Company in any manner
      to fund any obligation to the Participants, terminated Participants, or
      beneficiaries hereunder. Nothing contained in the Plan nor any action taken
      hereunder shall create, or be construed to create, a trust of any kind, or
      a
      fiduciary relationship between a Company and the Participants, terminated
      Participants, beneficiaries, or any other persons. Any funds which may be
      accumulated by a Company in order to meet any obligations under the Plan shall
      for all purposes continue to be a part of the general assets of a Company.
      A
      Company may establish a trust to hold funds intended to provide benefits
      hereunder to the extent the assets of such trust become subject to the claims
      of
      the general creditors of such Company in the event of bankruptcy or insolvency
      of such Company; provided, however, that a Company shall establish no such
      trust
      if the assets thereof are includable in the income of any Participant thereby
      pursuant to Section 409A(b). To the extent that any Participant, terminated
      Participant, or beneficiary acquires a right to receive payments from a Company
      under the Plan, such rights shall be no greater than the rights of any unsecured
      general creditor of such Company.




5.5  Applicable
      Law .
      All
      questions pertaining to the construction, validity and effect of the Plan shall
      be determined in accordance with the laws of the State of North Carolina to
      the
      extent not preempted by Federal law and shall be construed in a manner
      consistent with the requirements of Section 409A.







5.6  Limitation
      of Rights .
      The
      Plan is a voluntary undertaking on the part of the Sponsor and each Company.
      Neither the establishment of the Plan nor the payment of any benefits hereunder,
      nor any action of the Sponsor, a Company or the Plan Administrator shall be
      held
      or construed to be a contract of employment between the Sponsor, a Company
      and
      any Eligible Employee or to confer upon any person any legal right to be
      continued in the employ of the Sponsor or a Company. The Sponsor and each
      Company expressly reserve the right to discharge, discipline or otherwise
      terminate the employment of any Eligible Employee at any time. Participation
      in
      the Plan gives no right or claim to any benefits beyond those which are
      expressly provided herein and all rights and claims hereunder are limited as
      set
      forth in the Plan.




5.7  Severability .
      In the
      event any provision of the Plan shall be held illegal or invalid, or the
      inclusion of any Participant would serve to invalidate the Plan as an unfunded
      plan for a select group of management or highly compensated employees under
      ERISA, then the illegal or invalid provision shall be deemed to be null- and
      void, and the Plan shall be construed as if it did not contain that provision
      and in the case of the inclusion of any such Participant, a separate plan,
      with
      the same provisions as the Plan, shall be deemed to have been established for
      the Participant or Participants ultimately determined not to constitute a select
      group of management or highly compensated employees.




5.8  Headings .
      The
      headings to the Articles and Sections of the Plan are inserted for reference
      only, and are not to be taken as limiting or extending the provisions
      hereof.




5.9  Incapacity .
      If the
      Plan Administrator shall determine that a Participant, or any other person
      entitled to a benefit under the Plan (the "Recipient") is unable to care for
      his
      or her affairs because of illness, accident, or mental or physical incapacity,
      or because the Recipient is a minor, the Plan Administrator may direct that
      any
      benefit payment due the Recipient be paid to his or her duly appointed legal
      representative, or, if no such representative is appointed, to the Recipient's
      spouse, child, parent, or other blood relative, or to a person with whom the
      Recipient resides or who has incurred expense on behalf of the Recipient. Any
      such payment so made shall be a complete discharge of the liabilities of the
      Plan with respect to the Recipient.




5.10  Binding
      Effect and Release .
      Obligations incurred by the Sponsor or a Company pursuant to this Plan shall
      be
      binding upon the Sponsor or a Company, its successors and assigns, and inure
      to
      the benefit of the Participant or his Eligible Spouse. All persons accepting
      benefits under the Plan shall be deemed to have consented to the terms of the
      Plan. Any payment or distribution to any person entitled to benefits under
      the
      Plan shall be in full satisfaction of all claims against the Plan, the
      Committee, and the Sponsor and any Company arising by virtue of the
      Plan.




5.11  Acceleration
      of Payments .
      The
      acceleration of the time or schedule of any payment due under the Plan is
      prohibited except as provided in regulations and administrative guidance
      provided under Section 409A of the Code. It is not an acceleration of the time
      or schedule of payment if the Company waives or accelerates the vesting
      requirements applicable to a benefit under the Plan.







ARTICLE
      VI




CHANGE
      IN CONTROL




Upon
      the
      occurrence of a Change in Control, the following provisions shall become
      effective immediately:




6.1  Vesting .
      There
      shall be full Vesting of each Participant’s Restoration Accrued Benefit,
      regardless of any termination of employment prior to eligibility for an Early
      Retirement Pension under the Retirement Plan, if he or she is otherwise vested
      under the Retirement Plan.




6.2  No
      Reduction Benefit .
      No
      amendment or termination of the Plan may reduce any Participant's Restoration
      Accrued Benefit as of the date of such amendment or termination.




6.3  Contributions
      to Trust .
      The
      Sponsor shall irrevocably set aside funds in one or more grantor trusts, subject
      to the provisions of Section 5.4, in an amount that is sufficient to pay each
      Participant (or Spouse) the benefits accrued under the Plan as of the date
      of
      the Change in Control. Any such trust shall be subject to the claims of the
      general creditors of the Sponsor in the event of the bankruptcy or insolvency
      of
      the Sponsor. The Sponsor shall establish no such trust if the assets thereof
      are
      includable in the income of Participants thereby pursuant to Section
      409A(b).




6.4  Termination
      of Plan .
      The
      Plan may be terminated and benefits distributed to Participants within twelve
      months of a “change in control event” as defined for purposes of Section 409A of
      the Code.











IN
      WITNESS WHEREOF, this instrument has been executed this 15th day of December,
      2006.





PROGRESS
      ENERGY,
      INC.








By:
/s/
      Robert B.
      McGehee


Robert B. McGehee


Chief Executive Officer




















APPENDIX
      A




Progress
      Energy Florida, Inc. (non-bargaining employees) solely with respect to accrued
      benefits on or after January 1, 2002 so that no Restoration Accrued Benefit
      is
      calculated under the Plan with respect to employment prior to January 1,
      2002.




Progress
      Fuels Corporation (corporate employees) solely with respect to accrued benefits
      on or after January 1, 2002 so that no Restoration Accrued Benefit is calculated
      under the Plan with respect to employment prior to January 1, 2002.




Progress
      Energy Carolinas, Inc.




Progress
      Energy Service Company, LLC




Progress
      Energy Ventures, Inc.