M: That is right. There was a great deal of negotiation, I was told, at that time
 trying to keep the securities from being watered too much in the process of
 this dissolution of the holding companies. Individuals within the holding
 company owning significant amounts of stock made a determined effort to
 benefit themselves significantly by influencing the types and amounts of
 securities that Florida Power and Light Company would assume as its
 corporate capitalization as it broke out of the holding company. Mr. Smith
 negotiated all of this.

P: Mr. Smith came into Florida Power and Light in 1939. He must have been
 a relatively young man then if he stayed in charge for almost another thirty
 years. You said he came out of Louisiana. What was his background?

M: I have mentioned previously that he came from Tennessee. He had worked
 for the Public Utility Commission (or some such name) in Tennessee. In
 some way he came to the attention of Electric Bond and Share and went to
 work in Louisiana. Then in the course of that he proved his capabilities
 politically as well as from an operating standpoint.

P: So he came to Florida well recommended.

M: That is right.

P: And he did a monumental job.

M: He did a very monumental job. He broke the impasse between Florida
 Power and Light Company and its dominant service area, which was south
 Florida (primarily Dade County) at that point. He was successful in
 interesting New York investors in Florida securities.

 As we have previously commented on, Florida had two devastating hurricanes,
 one in 1926 and one in 1928. There was another one in 1935, but that was
 concentrated in the Keys and did not really affect the rest of the state that
 much. But the general impression of the rest of the United States,
 particularly of the financial community in New York, was that Florida was a
 place that had had a disastrous real estate boom and was plagued with
 disastrous hurricanes.

 Mr. Smith set about in the late forties to woo the financial community in
 New York and to convince them that the state as a whole was a worthwhile
 place to consider as an investment. This not only succeeded for Florida
 Power and Light Company, but, I am told, succeeded in influencing them
 favorably to purchase Florida bonds. Florida state and municipal bonds had
 been in default for longer than most states in the twenties and the thirties,
 which was another negative factor in the minds of the financial community
 that had to be overcome. Mr. Smith needed money in order for his company


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