AMENDED AND RESTATED
 
                            ARTICLES OF INCORPORATION
 
                                       of
 
                                CP&L ENERGY, INC.
 
 
 
                                    ARTICLE I
                                      NAME
 
         The name of the corporation is CP&L Energy, Inc. (the "Corporation")
 
 
                                   ARTICLE II
                           REGISTERED OFFICE AND AGENT
 
         The street and mailing address of the registered office and the name
and mailing address of the registered agent of the Corporation in the State of
North Carolina is:
 
                   William D. Johnson
                   c/o Carolina Power & Light Company
                   411 Fayetteville Street
                   Raleigh, Wake County, North Carolina 27601
 
 
                                   ARTICLE III
                                    PURPOSES
 
         The purposes for which the Corporation is formed are to conduct the
business of a holding company as well as to transact any or all other lawful
business, not required to be specifically stated in these Articles of
Incorporation, for which corporations may be incorporated under the North
Carolina Business Corporation Act, as amended from time to time, and any
legislation succeeding thereto (the "NCBCA").
 
         All references herein to "Articles of Incorporation" shall mean these
Amended and Restated Articles of Incorporation, as subsequently amended or
restated in accordance herewith and with the NCBCA.
<PAGE>
 
 
                                   ARTICLE IV
                                  CAPITAL STOCK
 
         The aggregate number of shares that the Corporation shall have
authority to issue shall be 20,000,000 shares of Preferred Stock, no par value
per share (hereinafter called "Preferred Stock"), and 500,000,000 shares of
Common Stock, no par value per share (hereinafter called "Common Stock").
 
         The following is a description of each of such classes of stock, and a
statement of the preferences, limitations, voting rights and relative rights in
respect of the shares of each such class:
 
                  1. Authority to Fix Rights of Preferred Stock. The Board of
         Directors shall have authority, by resolution or resolutions, at any
         time and from time to time to divide and establish any or all of the
         unissued shares of Preferred Stock not then allocated to any series of
         Preferred Stock into one or more series, and, without limiting the
         generality of the foregoing, to fix and determine the designation of
         each such series, the number of shares that shall constitute such
         series and the following relative rights and preferences of the shares
         of each series so established:
 
                           (a) The annual or other periodic dividend rate
                  payable on shares of such series, the time of payment thereof,
                  whether such dividends shall be cumulative or non-cumulative,
                  and the date or dates from which any cumulative dividends
                  shall commence to accrue;
 
                           (b) the price or prices at which and the terms and
                  conditions, if any, on which shares of such series may be
                  redeemed;
 
                           (c) the amounts payable upon shares of such series in
                  the event of the voluntary or involuntary dissolution,
                  liquidation or winding-up of the affairs of the Corporation;
 
                           (d) the sinking fund provisions, if any, for the
                  redemption or purchase of shares of such series;
 
                           (e) the extent of the voting powers, if any, of the
                  shares of such series; provided, however, that no share of
                  Preferred Stock shall entitle its holder to more than one vote
                  on any matter;
 
                           (f) the terms and conditions, if any, on which shares
                  of such series may be converted into shares of stock of the
                  Corporation of any other class or classes or into shares of
                  any other series of the same or any other class or classes;
 
                           (g) whether, and if so the extent to which, shares of
                  such series may participate with the Common Stock in any
                  dividends in excess of the preferential dividend fixed for
                  shares of such series or in any distribution of the assets of
                  the Corporation, upon a liquidation, dissolution or winding-up
                  thereof, in excess of the preferential amount fixed for shares
                  of such series; and
 
                           (h) any other preferences and relative, optional or
                  other special rights, and qualifications, limitations or
                  restrictions of such preferences or rights, of shares of such
                  series not fixed and determined by law or in this Article III.
 
                  2. Distinctive Designations of Series. Each series of
         Preferred Stock shall be so designated as to distinguish the shares
         thereof from the shares of all other series. Different series of
         Preferred Stock shall not be considered to constitute different voting
         groups of shares for the purpose of voting by voting groups except as
         required by the NCBCA or as otherwise specified by the Board of
         Directors with respect to any series at the time of the creation
         thereof.
 
                  3. Restrictions on Certain Distributions. So long as any
         shares of Preferred Stock are outstanding, the Corporation shall not
         declare and pay or set apart for payment any dividends (other than
         dividends payable in Common Stock or other stock of the Corporation
         ranking junior to the Preferred Stock as to dividends) or make any
         other distribution on such junior stock if, at the time of making such
         declaration, payment or distribution, the Corporation shall be in
         default with respect to any dividend payable on, or any obligation to
         redeem, any shares of Preferred Stock.
 
                  4. Redeemed or Reacquired Shares. Shares of any series of
         Preferred Stock that have been redeemed or otherwise reacquired by the
         Corporation (whether through the operation of a sinking fund, upon
         conversion or otherwise) shall have the status of authorized and
         unissued shares of Preferred Stock and may be redesignated and reissued
         as a part of such series (unless prohibited by the articles of
         amendment creating such series) or of any other series of Preferred
         Stock. Shares of Common Stock that have been reacquired by the
         Corporation shall have the status of authorized and unissued shares of
         Common Stock and may be reissued.
 
                  5. Voting Rights. Subject to the provisions of the NCBCA or of
         the By-Laws of the Corporation as from time to time in effect with
         respect to the closing of the transfer books or the fixing of a record
         date for the determination of shareholders entitled to vote, and except
         as otherwise provided by the NCBCA or in resolutions of the Board of
         Directors establishing any series of Preferred Stock pursuant to the
         provisions of paragraph 1 of this Article IV, the holders of
         outstanding shares of Common Stock of the Corporation shall exclusively
         possess voting power for the election of directors and for all other
         purposes, with each holder of record of shares of Common Stock of the
         Corporation being entitled to one vote for each share of such stock
         standing in his name
         on the books of the Corporation. Shares shall not be voted cumulatively
         for the election of directors.
 
                  6. No Preemptive Rights. No holder of shares of stock of any
         class of the Corporation shall, as such holder, have any right to
         subscribe for or purchase (a) any shares of stock of any class of the
         Corporation, or any warrants, options or other instruments that shall
         confer upon the holder thereof the right to subscribe for or purchase
         or receive from the Corporation any shares of stock of any class,
         whether or not such shares of stock, warrants, options or other
         instruments are issued for cash or services or property or by way of
         dividend or otherwise, or (b) any other security of the Corporation
         that shall be convertible into, or exchangeable for, any shares of
         stock of the Corporation of any class or classes, or to which shall be
         attached or appurtenant any warrant, option or other instrument that
         shall confer upon the holder of such security the right to subscribe
         for or purchase or receive from the Corporation any shares of its stock
         of any class or classes, whether or not such securities are issued for
         cash or services or property or by way of dividend or otherwise, other
         than such right, if any, as the Board of Directors, in its sole
         discretion, may from time to time determine. If the Board of Directors
         shall offer to the holders of shares of stock of any class of the
         Corporation, or any of them, any such shares of stock, options,
         warrants, instruments or other securities of the Corporation, such
         offer shall not, in any way, constitute a waiver or release of the
         right of the Board of Directors subsequently to dispose of other
         securities of the Corporation without offering the same to said
         holders.
 
                  7. Shareholder Protection Act and Control Share Acquisition
         Act. The provisions of Articles 9 and 9A of the NCBCA shall not apply
         to acquisitions of shares of any class of capital stock of the
         Corporation.
 
 
                                    ARTICLE V
                                    DIRECTORS
 
                  1. Number. The number of directors shall be as specified in
         the By-Laws of the Corporation, but such number may be increased or
         decreased from time to time in such manner as may be prescribed in the
         By-Laws, provided that in no event shall the number of directors be
         less than nine or more than fifteen.
 
                  2. Removal. Subject to the rights of the holders of any
         Preferred Stock then outstanding, directors may be removed with or
         without cause by the affirmative vote of a majority of the voting power
         of the then outstanding shares of capital stock of the Corporation
         entitled to vote generally in the election of directors ("Voting
         Stock"), voting together as a single voting group.
 
                  3. Vacancies. Subject to the rights of the holders of any
         Preferred Stock then outstanding and to any limitations set forth in
         the NCBCA, newly-created directorships
         resulting from any increase in the number of directors and any
         vacancies in the Board of Directors resulting from death, resignation,
         disqualification, removal or other cause shall be filled solely (i) by
         the Board of Directors or (ii) at an annual meeting of shareholders by
         the shareholders entitled to vote on the election of directors. If the
         directors remaining in office constitute fewer than a quorum of the
         Board, they may fill the vacancy by the affirmative vote of a majority
         of the directors remaining in office.
 
 
                                   ARTICLE VI
                              AMENDMENT OF ARTICLES
 
         An amendment or restatement of the Articles of Incorporation requiring
shareholder approval shall be approved by a majority of the votes entitled to be
cast by each voting group that is entitled to vote on the matter, unless in
submitting any such amendment or restatement to the shareholders the Board of
Directors shall require a greater vote.
 
 
                                   ARTICLE VII
                                    IMMUNITY
 
         To the fullest extent permitted by the NCBCA, a director of the
Corporation shall not be liable to the Corporation or any of its shareholders
for monetary damages for breach of duty as a director. Any amendment to or
repeal of the provisions of this Article shall not impair any right or
protection of a director pertaining to service as a director up to the effective
time of such amendment or repeal.
 
 
                                  ARTICLE VIII
                              AMENDMENT OF BY-LAWS
 
         In furtherance of, and not in limitation of, the powers conferred by
the NCBCA, the Board of Directors is expressly authorized and empowered to
adopt, amend or repeal the By-Laws of the Corporation. By-laws adopted by the
Board of Directors under the powers hereby conferred may be altered, amended or
repealed by the Board of Directors or by the shareholders having voting power
with respect thereto as provided herein. In the case of any such action by
shareholders, the affirmative vote of the holders of a majority of the voting
power of the then outstanding Voting Stock, voting together as a single voting
group, shall be required in order for the shareholders to alter, amend or repeal
any provision of the By-Laws or to adopt any additional by-law. Any by-law
adopted, amended or repealed by the shareholders may not be readopted, amended
or repealed by the Board of Directors unless the Articles of Incorporation or a
by-law adopted by the shareholders authorizes the Board of Directors to adopt,
amend or repeal that particular by-law or the By-laws generally.
[End]
 
 
 

                               ARTICLES OF AMENDMENT

                                CP&L ENERGY, INC.

 

Pursuant to Section 55-10-06 of the General Statutes of North Carolina, the

undersigned corporation hereby submits the following Articles of Amendment for

the purpose of amending its Articles of Incorporation.

 

1.   The name of the corporation is CP&L Energy, Inc.

 

2.   The text of each amendment adopted is as follows:

 

          Article I of the Articles of Incorporation shall be amended and

          restated to read "The name of the Corporation is Progress Energy, Inc.

          (the 'Corporation')."

 

3.   The date of adoption of the amendment was June 15, 2000.

 

4.   The amendment was approved by shareholder action, and such shareholder

     approval was obtained as required by Chapter 55 of the North Carolina

     General Statutes.

 

5.   These articles will be effective upon filing.

 

This the 4th day of December, 2000

         ---        --------

 

                                                    CP&L ENERGY, INC.

 

 

                                                    By: /s/ William D. Johnson

                                                        ----------------------

                                                    William D. Johnson

                                                    Executive Vice President and

                                                    Corporate Secretary

 
 
 
 
 

 

State of North Carolina

Department of the Secretary of State

 

ARTICLES OF AMENDMENT

PROGRESS ENERGY, INC.

 

Pursuant to §55-10-06 of the General Statutes of North Carolina, the undersigned corporation hereby submits the following Articles of Amendment for the purpose of amending its Articles of Incorporation.

 

1.  

The name of the corporation is Progress Energy, Inc.

 

2.  

The text of each amendment adopted is as follows:

 

Article 5 of the Articles of Incorporation shall be amended by adding a new Section 4 to read as follows:

 

“4. Election. Except as provided in Section 3 of this Article, each director shall be elected by a vote of the majority of the votes cast with respect to the director at any meeting for the election of directors at which a quorum is present, provided that if the number of nominees exceeds the number of directors to be elected, the directors shall be elected by a vote of the plurality of the shares represented in person or by proxy at any such meeting and entitled to vote on the election of directors. For purposes of this Section, a majority of the votes cast means that the number of shares voted “for” a director must exceed the number of votes cast “against” that director.”

 

 

3.  

The date of adoption of the amendment was May 10, 2006

 

4.  

The amendment was approved by shareholder action, and such shareholder approval was obtained as required by Chapter 55 of the General Statutes of North Carolina.

 

5.  

These articles will be effective upon filing.

 

This the 10th day of May, 2006

 

                                                        PROGRESS ENERGY, INC.   

 

 

                        By: /s/ William D. Johnson

                        Name William D. Johnson

                        Title President and Chief Operating Officer