Progress Energy 2009 Annual Report Download - page 151

Progress Energy Proxy Statement
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SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
Section 16(a) of the Securities Exchange Act of 1934 requires our directors and executive officers to file
reports of their holdings and transactions in our securities with the SEC and the NYSE. Based on our records and
other information, we believe that all Section 16(a) filing requirements applicable to our directors and executive
officers with respect to the Company’s 2009 fiscal year were met, except as follows: James Scarola inadvertently
failed to timely file a Form 4 related to the deferral, in 2009 and 2010, of portions of two awards granted under
the Company’s Management Incentive Compensation Plan. A Form 4 reporting both transactions was filed on
March 16, 2010. Paula J. Sims inadvertently failed to file on a timely basis a Form 4 with respect to the deferral in
2009 of a portion of an award granted under the Company’s Management Incentive Compensation Plan. A Form 4
reporting the transaction was filed on March 16, 2010. Additionally, with regard to the Company’s 2010 fiscal year,
each of Jeffrey A. Corbett, Vincent M. Dolan, William D. Johnson, Michael A. Lewis, Jeffrey J. Lyash, John R.
McArthur, Mark F. Mulhern, James Scarola, Frank A. Schiller, Paula J. Sims, Jeffrey M. Stone and Lloyd M. Yates
inadvertently failed to file on a timely basis a Form 4 with respect to the payout of performance units granted under
the Company’s Performance Share Sub-Plan. A Form 4 reporting the transaction was filed by each individual on
March 11, 2010.
CORPORATE GOVERNANCE GUIDELINES AND CODE OF ETHICS
The Board of Directors operates pursuant to an established set of written Corporate Governance Guidelines
(the “Governance Guidelines”) that set forth our corporate governance philosophy and the governance policies
and practices we have implemented in support of that philosophy. The three core governance principles the Board
embraces are integrity, accountability and independence.
The Governance Guidelines describe Board membership criteria, the Board selection and orientation
process and Board leadership. The Governance Guidelines require that a minimum of 80 percent of the Board’s
members be independent and that the membership of each Board committee, except the Executive Committee,
consist solely of independent directors. Directors who are not full-time employees of the Company must retire
from the Board at age 73. Directors whose job responsibilities or other factors relating to their selection to the
Board change materially after their election are required to submit a letter of resignation to the Board. The Board
will have an opportunity to review the continued appropriateness of the individual’s Board membership under
these circumstances, and the Governance Committee will make the initial recommendation as to the individual’s
continued Board membership. The Governance Guidelines also describe the stock ownership guidelines that are
applicable to Board members and prohibit compensation to Board members other than directors’ fees and retainers.
The Governance Guidelines provide that the Organization and Compensation Committee of the Board
will evaluate the performance of the Chief Executive Officer on an annual basis, using objective criteria, and
will communicate the results of its evaluation to the full Board. The Governance Guidelines also provide that the
Governance Committee is responsible for conducting an annual assessment of the performance and effectiveness of
the Board, and its standing committees, and reporting the results of each assessment to the full Board annually.
The Governance Guidelines provide that Board members have complete access to our management and
can retain, at our expense, independent advisors or consultants to assist the Board in fulfilling its responsibilities,
as it deems necessary. The Governance Guidelines also state that it is the Board’s policy that the nonmanagement
directors meet in executive session on a regularly scheduled basis. Those sessions are chaired by the Lead
Director, John H. Mullin, III, who is also Chair of the Governance Committee. He can be contacted by writing to
John H. Mullin, III, Lead Director, Progress Energy, Inc. Board of Directors, c/o John R. McArthur, Executive Vice
President and Corporate Secretary, P.O. Box 1551, Raleigh, North Carolina 27602-1551. We screen mail addressed
to Mr. Mullin for security purposes and to ensure that it relates to discrete business matters relevant to the Company.
Mail addressed to Mr. Mullin that satisfies these screening criteria will be forwarded to him.