-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, DxQe8W253qYThLQSJ3k4d0l7EAMppiNVNNszirp1/OS/pHwDkHKnlrfjfxLrt1BS ZXbzMGjEaEgZg0s+rhY8kQ== 0000916641-98-000703.txt : 19980615 0000916641-98-000703.hdr.sgml : 19980615 ACCESSION NUMBER: 0000916641-98-000703 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 5 CONFORMED PERIOD OF REPORT: 19980612 ITEM INFORMATION: FILED AS OF DATE: 19980612 SROS: NYSE FILER: COMPANY DATA: COMPANY CONFORMED NAME: VIRGINIA ELECTRIC & POWER CO CENTRAL INDEX KEY: 0000103682 STANDARD INDUSTRIAL CLASSIFICATION: ELECTRIC SERVICES [4911] IRS NUMBER: 540418825 STATE OF INCORPORATION: VA FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 8-K SEC ACT: SEC FILE NUMBER: 001-02255 FILM NUMBER: 98647741 BUSINESS ADDRESS: STREET 1: ONE JAMES RIVER PLAZA STREET 2: 701 E CARY STREET CITY: RICHMOND STATE: VA ZIP: 23219-3932 BUSINESS PHONE: 8047713000 MAIL ADDRESS: STREET 1: 701 E CARY STREET CITY: RICHMOND STATE: VA ZIP: 23219-3932 8-K 1 VIRGINIA ELECTRIC AND POWER COMPANY 8-K SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 8-K CURRENT REPORT Pursuant to section 13 or 15(d) of The Securities Exchange Act of 1934 Date of Report (Date of earliest event reported) June 12, 1998 Virginia Electric and Power Company (Exact name of registrant as specified in its charter) Virginia 1-2255 54-0418825 (State or other juris- (Commission (IRS Employer diction of Incorporation) File Number) Identification No.) 701 E. Cary Street, Richmond, Virginia 23219-3932 (Address of principal executive offices) (Zip Code) Registrant's telephone number, including area code (804) 771-3000 (Former name or former address, if changed since last report.) ITEM 5. OTHER EVENTS On June 12, 1998, Virginia Electric and Power Company (the Company) entered into an underwriting agreement (the Underwriting Agreement) with Lehman Brothers Inc., as representative of the Underwriters named in Schedule II of the Underwriting Agreement, for the sale of $150 million aggregate principal amount of the Company's Senior Notes. Such Senior Notes, which are designated the 1998 Series A 7.15% Senior Notes, due June 30, 2038, are a portion of the $375 million aggregate principal amount of Debt Securities that were registered by the Company pursuant to a registration statement on Form S-3 under Rule 415 under the Securities Act of 1933, which registration statement was declared effective on March 18, 1998 (File No. 333-47119). This Registration Statement also constitutes Post-Effective Amendment No. 1 of Registration Statement No. 33-59581 regarding $375 million of the Company's First and Refunding Mortgage Bonds registered for sale, pursuant to Rule 429 under the Securities Act of 1933, as amended. A copy of the Underwriting Agreement including exhibits thereto, is filed as Exhibit 1 to this Form 8-K. The designation of, and the terms and conditions applicable to, the 1998 Series A 7.15% Senior Notes, due June 30, 2038 were established as set forth in the First Supplemental Indenture to the Company's Senior Indenture, dated as of June 1, 1998, and have been approved by the Board of Directors of the Company. A copy of the form of Senior Indenture is filed as Exhibit 4.1 to this Form 8-K. A copy of the form of Supplemental Indenture is filed as Exhibit 4.2 to this Form 8-K. Exhibits: 1 Underwriting Agreement, dated June 12, 1998, between the Company and Lehman Brothers Inc., as representative of the Underwriters named in Schedule II of said Underwriting Agreement (filed herewith). 4.1 The form of Senior Indenture filed as Exhibit 4(ii) to the Company's Registration Statement is hereby incorporated by reference. 4.2 Form of First Supplemental Indenture to the Senior Indenture, dated as of June 1, 1998, pursuant to which the 1998 Series A 7.15% Senior Notes, due June 30, 2038, will be issued. The Form of the 1998 Series A 7.15% Senior Notes is included as Exhibit A to the First Supplemental Indenture (filed herewith). 12 Computation of Ratio of Earnings to Fixed Charges (filed herewith). 23 Consent of McGuire, Woods, Battle & Boothe LLP (filed herewith). SIGNATURE Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized. VIRGINIA ELECTRIC AND POWER COMPANY Registrant /s/ James P. Carney --------------------------------- James P. Carney Assistant Treasurer and Assistant Corporate Secretary Date: June 12, 1998 EX-1 2 EXHIBIT 1 - UNDERWRITING AGREEMENT VIRGINIA ELECTRIC AND POWER COMPANY 1998 Series A 7.15% Senior Notes, Due June 30, 2038 UNDERWRITING AGREEMENT June 12, 1998 Lehman Brothers Inc., as Representative for the Several Underwriters named in Schedule II hereto Three World Financial Center 200 Vesey Street, 6th Floor New York, NY 10285 Ladies and Gentlemen: The undersigned, Virginia Electric and Power Company (the Company), hereby confirms its agreement with the several Underwriters named in Schedule II hereto (the Agreement) with respect to the sale to the several Underwriters of certain of its Senior Notes (the Senior Notes) specified in Schedule I hereto, and the public offering thereof by the several Underwriters, upon the terms specified in Schedule I hereto. 1. Underwriters and Representative. The term "Underwriters" as used herein shall be deemed to mean the several persons, firms or corporations (including the Representative hereinafter mentioned) named in Schedule II hereto, and the term "Representative" as used herein shall be deemed to mean the representative to whom this Agreement is addressed, who by signing this Agreement represents that it has been authorized by the other Underwriters to execute this Agreement on their behalf and to act for them in the manner herein provided. If there shall be only one person, firm or corporation named in Schedule II hereto, the term "Underwriters" and the term "Representative" as used herein shall mean that person, firm or corporation. All obligations of the Underwriters hereunder are several and not joint. Any action under or in respect of this Agreement taken by the Representative will be binding upon all the Underwriters. 2. Description of the Senior Notes. Schedule I specifies the aggregate principal amount of the Senior Notes, the initial public offering price of the Senior Notes, the purchase price to be paid by the Underwriters, and any concession from the initial public offering price to be allowed to dealers or brokers, and sets forth the date, time and manner of delivery of the Senior Notes and payment thereof. Schedule I also specifies (to the extent not set forth in the Registration Statement and Prospectus referred to below) the terms and provisions for the purchase of such Senior Notes. The Senior Notes will be issued under the Company's Senior Indenture dated as of June 1, 1998 between the Company and The Chase Manhattan Bank, as Trustee (the Trustee), as supplemented by a First Supplemental Indenture dated as of June 1, 1998 (collectively, the Senior Indenture). 3. Representations and Warranties of the Company. The Company represents and warrants to, and agrees with, the Underwriters that: (a) A registration statement, No. 333-47119 on Form S-3 for the registration of the Senior Notes under the Securities Act of 1933, as amended (the Securities Act), heretofore filed with the Securities and Exchange Commission (the Commission), a copy of which as so filed has been delivered to you, has become effective. The registration statement, including all exhibits thereto, as amended through the date hereof, is hereinafter referred to as the "Registration Statement"; the prospectus relating to the Senior Notes included in the Registration Statement, which prospectus is now proposed to be supplemented by a supplement relating to the Senior Notes to be filed with the Commission under the Securities Act, as so supplemented, is hereinafter referred to as the "Prospectus". As used herein, the terms "Registration Statement", "prospectus" and "Prospectus" include all documents (including any Current Report on Form 8-K) incorporated therein by reference, and shall include any documents (including any Current Report on Form 8-K) filed after the date of such Registration Statement, prospectus or Prospectus and incorporated therein by reference from the date of filing of such incorporated documents (collectively, the Incorporated Documents). (b) No order suspending the effectiveness of the Registration Statement or otherwise preventing or suspending the use of the Prospectus has been issued by the Commission and is in effect and no proceedings for that purpose are pending before or, to the knowledge of the Company, threatened by the Commission. The Registration Statement and the Prospectus comply in all material respects with the provisions of the Securities Act, the Securities Exchange Act of 1934, as amended (the Securities Exchange Act), and the Trust Indenture Act of 1939, as amended (the Trust Indenture Act), and the rules, regulations and releases of the Commission thereunder (the Rules and Regulations), and, on the date hereof, neither the Registration Statement nor the Prospectus contain an untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary to make the statements therein not misleading, and, on the Closing Date, the Registration Statement and the Prospectus (including any amendments and supplements thereto) will conform in all respects to the requirements of the Securities Act, the Trust Indenture Act and the Rules and Regulations, and neither of such documents will include any untrue statement of a material fact or omit to state any material fact required to be stated therein or necessary to make the statements therein not misleading; provided, that the foregoing representations and warranties in this paragraph (b) shall not apply to statements in or omissions from the Registration Statement or the Prospectus made in reliance upon information furnished herein or in writing to the Company by the Underwriters or on the Underwriters' behalf for use in the Registration Statement or Prospectus; and provided, further, that the foregoing representations and warranties are given on the basis that any statement contained in an Incorporated Document shall be deemed not to be contained in the Registration Statement or Prospectus if the statement has been modified or superseded by any statement in a subsequently filed Incorporated Document or in the Registration Statement or Prospectus or in any amendment or supplement thereto. (c) Deloitte & Touche LLP, who have examined certain of the Company's financial statements filed with the Commission and incorporated by reference in the Registration Statement, are independent public accountants as required by the Securities Act and the rules and regulations of the Commission thereunder. (d) Except as reflected in, or contemplated by, the Registration Statement and Prospectus, since the respective most recent dates as of which information is given in the Registration Statement and Prospectus, there has not been any material adverse change in the condition of the Company, financial or otherwise. The Company has no material contingent financial obligation that is not disclosed in each of the Registration Statement and Prospectus. (e) The Company has taken all corporate action necessary to be taken by it to authorize the execution by it of this Agreement and the performance by it of all obligations on its part to be performed hereunder; and the consummation of the transactions herein contemplated and the fulfillment of the terms hereof will not result in a breach of any of the terms or provisions of, or constitute a default under, any indenture, mortgage, deed of trust, or other agreement or instrument to which the Company is now a party, or the charter of the Company, as amended, or any order, rule or regulation applicable to the Company of any federal or state regulatory board or body or administrative agency having jurisdiction over the Company or over its property. (f) The Senior Notes, upon issuance thereof, will conform in all respects to the terms of the relevant order or orders of the State Corporation Commission of Virginia (the Virginia Commission) now or hereafter in effect with respect to the Senior Notes. 4. Public Offering. On the basis of the representations and warranties herein contained, but subject to the terms and conditions in this Agreement set forth, the Company agrees to sell to each of the several Underwriters, and each Underwriter agrees, severally and not jointly, to purchase from the Company, at the price, place and time hereinafter specified, the principal amount of the Senior Notes set forth opposite the name of such Underwriter in Schedule II hereto. The several Underwriters agree to make a public offering of their respective Senior Notes specified in Schedule II hereto at the initial public offering price specified in Schedule I hereto. It is understood that after such initial offering the several Underwriters reserve the right to vary the offering price and further reserve the right to withdraw, cancel or modify such offering without notice. 5. Time and Place of Closing. Delivery of the Senior Notes to, and payment therefor by, the Representative for the accounts of the several Underwriters shall be made at the time, place and date specified in Schedule I or such other time, place and date as the Representative and the Company may agree upon in writing, and subject to the provisions of Section 10 hereof. The hour and date of such delivery and payment are herein called the "Closing Date". Unless otherwise specified in Schedule I hereto, payment for the Senior Notes shall be made to the Company by wire transfer in federal funds at the Closing Date against delivery of the Senior Notes, in fully registered form, registered in the name of Cede & Co., as nominee for the Depositary Trust Company. The certificate(s) for the Senior Notes will be made available at the location specified on Schedule I for examination by the Representative not later than 12:00 Noon, New York time, on the last business day prior to the Closing Date. 6. Covenants of the Company. The Company agrees that: (a) The Company, at or prior to the Closing Date, will deliver to the Representative conformed copies of the Registration Statement as originally filed, including all exhibits, any related preliminary prospectus supplement, the Prospectus and all amendments and supplements to each such document, in each case as soon as available and in such quantities as are reasonably requested by the Representative. (b) The Company will pay all expenses in connection with (i) the preparation and filing by it of the Registration Statement and Prospectus, (ii) the preparation, issue and delivery of certificates for the Senior Notes, (iii) any fees and expenses of the Trustee and (iv) the printing and delivery to the Underwriters in reasonable quantities of copies of the Registration Statement and the Prospectus (each as originally filed and as subsequently amended). The Company also will pay all taxes, if any, except transfer taxes, on the issue of the Senior Notes. In addition, the Company will pay the reasonable fees and disbursements of Underwriters' counsel, Mays & Valentine, L.L.P., in connection with the qualification of the Senior Notes under state securities or blue sky laws or investment laws (if and to the extent such qualification is required by the Underwriters or the Company). (c) If, at any time when a prospectus relating to the Senior Notes is required to be delivered under the Act, any event occurs as a result of which the Prospectus as then amended or supplemented would include an untrue statement of a material fact or omit to state any material fact necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading, or if it is necessary at any time to amend the Prospectus to comply with the Act, the Company promptly will (i) notify the Representative to suspend solicitation of purchases of the Senior Notes and (ii) at its expense, prepare and file with the Commission an amendment or supplement which will correct such statement or omission or an amendment which will effect such compliance. In case any Underwriter is required to deliver a prospectus in connection with the sale of any Senior Notes after the expiration of the period specified in the preceding sentence, the Company, upon the request of the Representative, will furnish to the Representative, at the expense of such Underwriter, a reasonable quantity of a supplemented or amended prospectus, or supplements or amendments to the Prospectus, complying with Section 10(a) of the Securities Act. During the period specified in the second sentence of this paragraph, the Company will continue to prepare and file with the Commission on a timely basis all documents or amendments required under the Securities Exchange Act and the applicable rules and regulations of the Commission thereunder; provided, that the Company shall not file such documents or amendments without also furnishing copies thereof to the Representative and Mays & Valentine, L.L.P. (d) The Company will advise the Representative promptly of any proposal to amend or supplement the Registration Statement or the Prospectus and will afford the Representative a reasonable opportunity to comment on any such proposed amendment or supplement; and the Company will also advise the Representative promptly of the filing of any such amendment or supplement and of the institution by the Commission of any stop order proceedings in respect of the Registration Statement or of any part thereof and will use its best efforts to prevent the issuance of any such stop order and to obtain as soon as possible its lifting, if issued. (e) The Company will make generally available to its security holders, as soon as it is practicable to do so, an earnings statement of the Company (which need not be audited) in reasonable detail, covering a period of at least 12 months beginning within three months after the effective date of the Registration Statement, which earnings statement shall satisfy the requirements of Section 11(a) of the Securities Act. (f) For a period of five years following the Closing Date, the Company will deliver to the Representative, as soon as practicable after the end of each fiscal year, a balance sheet of the Company as of the end of such year and statements of income and earnings reinvested in business for such year, all as certified by independent public or certified public accountants, and will deliver to the Representative upon request, as soon as practicable after the end of each quarterly period, statements of income and earnings reinvested in business for the 12 month period ending with the end of such quarterly period. (g) The Company will use its best efforts promptly to do and perform all things to be done and performed by it hereunder prior to the Closing Date and to satisfy all conditions precedent required of it to the delivery by it of the Senior Notes. (h) The Company will furnish such proper information as may be lawfully required and otherwise cooperate in qualifying the Senior Notes for offer and sale under the securities or blue sky laws of such states as the Representative may designate; provided, however, that the Company shall not be required in any state to qualify as a foreign corporation, or to file a general consent to service of process, or to submit to any requirements which it deems unduly burdensome. (i) Fees and disbursements of Mays & Valentine, L.L.P., who are acting as counsel for the Underwriters (exclusive of fees and disbursements of such counsel which are to be paid as set forth in paragraph 6(b)), shall be paid by the Underwriters; provided, however, that if this Agreement is terminated in accordance with the provisions of Sections 7 or 8 hereof, the Company shall reimburse the Representative for the account of the Underwriters for the amount of such fees and disbursements. 7. Conditions of Underwriters' Obligations; Termination by the Underwriters. (a) The obligations of the Underwriters to purchase and pay for the Senior Notes shall be subject to the following conditions: (i) No stop order suspending the effectiveness of the Registration Statement shall be in effect on the Closing Date and no proceedings for that purpose shall be pending before, or to the knowledge of the Company threatened by, the Commission on such date. The Representative shall have received, prior to payment for the Senior Notes, a certificate dated the Closing Date and signed by the President or any Vice President of the Company to the effect that no such stop order is in effect and that no proceedings for such purpose are pending before or, to the knowledge of the Company, threatened by the Commission. (ii) At the Closing Date an order or orders of the Virginia Commission permitting the issuance and sale of the Senior Notes substantially in accordance with the terms and conditions hereof shall be in full force and effect and shall contain no provision unacceptable to the Representative or the Company (but all provisions of such order or orders heretofore entered are deemed acceptable to the Representative and the Company, and all provisions of such order or orders hereafter entered shall be deemed acceptable to the Representative and the Company unless within 24 hours after receiving a copy of any such order either shall give notice to the other to the effect that such order contains an unacceptable provision). (iii) At the Closing Date the Representative shall receive, on behalf of the several Underwriters, the opinions of Mays & Valentine, L.L.P., and McGuire, Woods, Battle & Boothe LLP, substantially in the forms attached hereto as Schedules III and IV. (iv) On the date of this Agreement and on the Closing Date, the Representative shall have received from Deloitte & Touche LLP a letter addressed to the Representative, dated the date of this Agreement and the Closing Date, respectively, (A) confirming that they are independent public accountants as required by the Securities Act; (B) stating in effect that, in their opinion, the audited financial statements included in or incorporated by reference in the Registration Statement and the Prospectus and audited by them as stated in their report incorporated by reference in the Registration Statement (the Audited Financial Statements), comply as to form in all material respects with the applicable accounting requirements adopted pursuant to the Securities Exchange Act; (C) stating, in effect, that on the basis of a reading of the minutes of the meetings of the Board of Directors of the Company and of committees of the Board since the end of the period covered by the Audited Financial Statements, a reading of the unaudited financial statements incorporated by reference in the Prospectus (if any), of the unaudited statement of income for any interim period for which information is included in the Prospectus under the caption "Selected Financial Information" or any section updating such information, and of the latest available unaudited financial statements of the Company covering a period of twelve months ending after the end of the period covered by the Audited Financial Statements (if any), and inquiries of officials of the Company responsible for financial and accounting matters (which procedures did not constitute an audit made in accordance with generally accepted auditing standards), nothing came to their attention that caused them to believe that such unaudited financial statements incorporated by reference in the Prospectus are not in conformity with generally accepted accounting principles applied on a basis substantially consistent with that of the Audited Financial Statements; and (D) stating, in effect, that on the basis of more limited procedures than those set forth in the foregoing clause (C), consisting merely of the reading of the minutes referred to in said clause and inquiries of officials of the Company responsible for financial and accounting matters, nothing came to their attention at a date not more than five business days prior to the date of such letter that caused them to believe that (1) at such date there was any decrease in common stockholder's equity or any increase in funded debt of the Company or any decrease in net assets as compared with the amounts shown in the balance sheet included in the most recent financial statements incorporated by reference, or (2) for the period from the date of the most recent unaudited financial statements included or incorporated by reference in the Registration Statement and the Prospectus to a date not more than five business days prior to the date of such letter there were any decreases, as compared with the corresponding period in the preceding year, in the operating revenues, operating income or net income, except (with respect to (1) or (2)) in all instances for changes or decreases that the Registration Statement discloses have occurred or may occur; provided, however, that said letters may vary from the requirements specified in clause (D) hereof in such manner as the Representative in its sole discretion may deem to be acceptable. Said letters shall also state that the dollar amounts, percentages and other financial information (in each case to the extent that such dollar amounts, percentages and other financial information, either directly or by analysis or computation, are derived from the general accounting records of the Company) that appear (1) in the Prospectus under the captions "Selected Financial Information" and "Other Selected Data" and under any caption contained in a supplement to the Prospectus updating such dollar amounts, percentages and other financial information (limited to total assets and utility plant expenditures), (2) in the Company's most recent Annual Report on Form 10-K under the caption "Selected Financial Data" or (3) in the Registration Statement under the caption "Ratio of Earnings to Fixed Charges" have been compared with the general accounting records of the Company and such dollar amounts, percentages and financial information have been found to be in agreement with the accounting records of the Company and the computations have been found to be arithmetically correct. Each such letter shall relate to the Registration Statement and Prospectus as amended or supplemented to the date of each such letter. (v) Subsequent to the execution of this Agreement and prior to the Closing Date, (A) except as reflected in, or contemplated by, the Registration Statement and the Prospectus, there shall not have occurred (1) any change in the Senior Notes of the Company (other than a decrease in the aggregate principal amount thereof outstanding), (2) any material adverse change in the general affairs, financial condition or earnings of the Company (whether or not arising in the ordinary course of business) or (3) any material transaction entered into by the Company other than a transaction in the ordinary course of business, the effect of which in each such case in the judgment of the Representative is so material and so adverse that it makes it inadvisable to proceed with the public offering or delivery of the Senior Notes on the terms and in the manner contemplated in the Prospectus and this Agreement, or (B) there shall not have occurred (1) a downgrading in the rating accorded the Company's senior unsecured notes by any "nationally recognized statistical rating organization" (as that term is defined by the Commission for purposes of Rule 436(g)(2) under the Securities Act), (2) any general suspension of trading in securities on the New York Stock Exchange or any limitation on prices for such trading or any restrictions on the distribution of securities established by the New York Stock Exchange or by the Commission or by any federal or state agency or by the decision of any court, (3) a banking moratorium declared either by federal or New York State authorities or (4) any outbreak or escalation of major hostilities in which the United States is involved, any declaration of war by the United States Congress or any other substantial national or international calamity or crisis resulting in the declaration of a national emergency, the effect of which outbreak, escalation, declaration, calamity or crisis, in the reasonable judgment of the Representative, makes it impracticable or inadvisable to proceed with the public offering or delivery of the Senior Notes on the terms and in the manner contemplated in the Prospectus and in this Agreement. (vi) On the Closing Date, the representations and warranties of the Company in this Agreement shall be true and correct as if made on and as of such date, and the Company shall have performed all obligations and satisfied all conditions required of it under this Agreement; and, at the Closing Date, the Representative shall have received a certificate to such effect signed by the President or any Vice President of the Company. (vii) All legal proceedings to be taken in connection with the issuance and sale of the Senior Notes shall have been satisfactory in form and substance to Mays & Valentine, L.L.P. (b) In case any of the conditions specified above in paragraph 7(a) shall not have been fulfilled, this Agreement may be terminated by the Representative upon mailing or delivering written notice thereof to the Company; provided, however, that in case the conditions specified in subparagraphs 7(a)(v) and (vi) shall not have been fulfilled, this Agreement may not be so terminated by the Representative unless Underwriters who have agreed to purchase in the aggregate 50% or more of the aggregate principal amount of the Senior Notes shall have consented to such termination and the aforesaid notice shall so state. Any such termination shall be without liability of any party to any other party except as otherwise provided in Section 9 and in paragraphs 6(b), 6(i) and 7(c) hereof. (c) If this Agreement shall be terminated by the Representative pursuant to paragraph (b) above or because of any failure or refusal on the part of the Company to comply with the terms or to fulfill any of the conditions of this Agreement, or if for any reason the Company shall be unable to perform its obligations under this Agreement, then in any such case, the Company will reimburse the Underwriters, severally, for all out-of-pocket expenses (in addition to the fees and disbursements of their counsel as provided in paragraph 6(i)) reasonably incurred by such Underwriters in connection with this Agreement or the offering contemplated hereunder and, upon such reimbursement, the Company shall be absolved from any further liability hereunder, except as provided in paragraph 6(b) and Section 9. 8. Conditions of the Obligation of the Company. The obligation of the Company to deliver the Senior Notes shall be subject to the conditions set forth in the first sentence of subparagraphs 7(a)(i) and 7(a)(ii). In case said conditions shall not have been fulfilled, this Agreement may be terminated by the Company by mailing or delivering written notice thereof to the Representative. Any such termination shall be without liability of any party to any other party except as otherwise provided in paragraphs 6(b) and 6(i) and in Sections 9 and 10 hereof. 9. Indemnification. (a) The Company agrees to indemnify and hold harmless each Underwriter and each person who controls any Underwriter within the meaning of Section 15 of the Securities Act or Section 20(a) of the Securities Exchange Act, against any and all losses, claims, damages or liabilities, joint or several, to which they or any of them may become subject under the Securities Act, the Securities Exchange Act, or any other statute or common law and to reimburse each such Underwriter and controlling person for any legal or other expenses (including, to the extent hereinafter provided, reasonable counsel fees) incurred by them in connection with investigating any such losses, claims, damages, or liabilities, or in connection with defending any actions, insofar as such losses, claims, damages, liabilities, expenses or actions arise out of or are based upon any untrue statement or alleged untrue statement of a material fact contained in the Registration Statement or the Prospectus, or in either such document as amended or supplemented (if any amendments or supplements thereto shall have been furnished), or any Preliminary Prospectus (if and when used prior to the effective date of the Registration Statement), or the omission or alleged omission to state therein a material fact required to be stated therein or necessary to make the statements therein not misleading; provided that the foregoing agreement, insofar as it relates to any Preliminary Prospectus, shall not inure to the benefit of any Underwriter (or to the benefit of any person who controls such Underwriter) on account of any losses, claims, damages or liabilities arising out of the sale of any of the Senior Notes by such Underwriter to any person if it shall be established that a copy of the Prospectus, excluding any documents incorporated by reference (as supplemented or amended, if the Company shall have made any supplements or amendments which have been furnished to the Representative), shall not have been sent or given by or on behalf of such Underwriter to such person at or prior to the written confirmation of the sale to such person in any case where such delivery is required by the Securities Act, if the misstatement or omission leading to such loss, claim, damage or liability was corrected in the Prospectus (excluding any documents incorporated by reference) as amended or supplemented, and such correction would have cured the defect giving rise to such loss, claim, damage, or liability; and provided further, however, that the indemnity agreement contained in this paragraph 9(a) shall not apply to any such losses, claims, damages, liabilities, expenses or actions arising out of or based upon any such untrue statement or alleged untrue statement, or any such omission or alleged omission, if such statement or omission was made in reliance upon information furnished herein or otherwise in writing to the Company by or on behalf of any Underwriter for use in the Registration Statement or any amendment thereto, in the Prospectus or any supplement thereto, or in any Preliminary Prospectus. The indemnity agreement of the Company contained in this paragraph (a) and the representations and warranties of the Company contained in Section 3 hereof shall remain operative and in full force and effect, regardless of any investigation made by or on behalf of any Underwriter or any such controlling person, and shall survive the delivery of the Senior Notes. (b) Each Underwriter agrees, severally and not jointly, to indemnify and hold harmless the Company, its officers and directors, each other Underwriter, and each person who controls any thereof within the meaning of Section 15 of the Securities Act or Section 20(a) of the Securities Exchange Act, against any and all losses, claims, damages or liabilities, joint or several, to which they or any of them may become subject under the Securities Act, the Securities Exchange Act, or any other statute or common law and to reimburse each of them for any legal or other expenses (including, to the extent hereinafter provided, reasonable counsel fees) incurred by them in connection with investigating any such losses, claims, damages or liabilities or in connection with defending any actions, insofar as such losses, claims, damages, liabilities, expenses or actions arise out of or are based upon any untrue statement or alleged untrue statement of a material fact contained in the Registration Statement or the Prospectus, or in either such document as amended or supplemented (if any amendments or supplements thereto shall have been furnished), or any Preliminary Prospectus (if and when used prior to the effective date of the Registration Statement), or the omission or alleged omission to state therein a material fact required to be stated therein or necessary to make the statements therein not misleading, if such statement or omission was made in reliance upon information furnished herein or in writing to the Company by or on behalf of such Underwriter for use in the Registration Statement or the Prospectus or any amendment or supplement to either thereof, or any Preliminary Prospectus. The indemnity agreement of the respective Underwriters contained in this paragraph 9(b) shall remain operative and in full force and effect, regardless of any investigation made by or on behalf of the Company, or any such other Underwriter or any such controlling person, and shall survive the delivery of the Senior Notes. (c) The Company and each of the Underwriters agrees that, upon the receipt of notice of the commencement of any action against the Company or any of its officers or directors, or any person controlling the Company, or against such Underwriter or controlling person as aforesaid, in respect of which indemnity may be sought on account of any indemnity agreement contained herein, it will promptly give written notice of the commencement thereof to the party or parties against whom indemnity shall be sought hereunder, but the omission so to notify such indemnifying party or parties of any such action shall not relieve such indemnifying party or parties from any liability which it or they may have to the indemnified party otherwise than on account of such indemnity agreement. In case such notice of any such action shall be so given, such indemnifying party shall be entitled to participate at its own expense in the defense or, if it so elects, to assume (in conjunction with any other indemnifying parties) the defense of such action, in which event such defense shall be conducted by counsel chosen by such indemnifying party (or parties) and satisfactory to the indemnified party or parties who shall be defendant or defendants in such action, and such defendant or defendants shall bear the fees and expenses of any additional counsel retained by them; provided that, if the defendants in any such action include both the indemnified party and the indemnifying party (or parties) and the indemnified party shall have reasonably concluded that there may be legal defenses available to it and/or other indemnified parties which are different from or additional to those available to the indemnifying party (or parties), the indemnified party shall have the right to select separate counsel to assert such legal defenses and to participate otherwise in the defense of such action on behalf of such indemnified party. The indemnifying party shall bear the reasonable fees and expenses of counsel retained by the indemnified party if (i) the indemnified party shall have retained such counsel in connection with the assertion of legal defenses in accordance with the proviso to the preceding sentence (it being understood, however, that the indemnifying party shall not be liable for the expenses of more than one separate counsel, representing the indemnified parties under paragraphs 9(a) or 9(b), as the case may be, who are parties to such action), (ii) the indemnifying party shall have elected not to assume the defense of such action, (iii) the indemnifying party shall not have employed counsel satisfactory to the indemnified party to represent the indemnified party within a reasonable time after notice of the commencement of the action, or (iv) the indemnifying party has authorized the employment of counsel for the indemnified party at the expense of the indemnifying party. (d) If the indemnification provided for in this Section 9 is unavailable to or insufficient to hold harmless an indemnified party under paragraphs (a) or (b) above in respect of any losses, claims, damages or liabilities (or actions in respect thereof) referred to therein, then each indemnifying party shall contribute to the amount paid or payable by such indemnified party as a result of such losses, claims, damages or liabilities (or actions in respect thereof) in such proportion as is appropriate to reflect the relative fault of the Company, on the one hand, and of you, on the other, in connection with the statements or omissions that resulted in such losses, claims, damages or liabilities (or actions in respect thereof), as well as any other relevant equitable considerations, including relative benefit. The relative fault shall be determined by reference to, among other things, whether the untrue or alleged untrue statement of a material fact or the omission or alleged omission to state a material fact required to be stated therein or necessary in order to make the statements therein not misleading relates to information supplied by the Company on the one hand or by you on the other and the parties' relative intent, knowledge, access to information and opportunity to correct or prevent such statement or omission. The Company and you agree that it would not be just and equitable if contribution pursuant to this paragraph (d) were determined by pro rata allocation or by any other method of allocation which does not take account of the equitable considerations referred to above in this paragraph (d). The amount paid or payable by an indemnified party as a result of the losses, claims, damages or liabilities (or actions in respect thereof) referred to above in this paragraph (d) shall be deemed to include any legal or other expenses reasonably incurred by such indemnified party in connection with investigating or defending any such action or claim. No person guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of the Securities Act) shall be entitled to contribution from any person who was not guilty of such fraudulent misrepresentation. The Underwriters' obligations under this paragraph (d) to contribute are several in proportion to their respective underwriting obligations and not joint. 10. Termination by the Company. If any one or more of the Underwriters shall fail or refuse to purchase the Senior Notes which it or they have agreed to purchase hereunder, and the aggregate principal amount of the Senior Notes which such defaulting Underwriter or Underwriters agreed but failed or refused to purchase is not more than one-tenth of the aggregate principal amount of the Senior Notes, the other Underwriters shall be obligated severally in the proportions which the principal amount of the Senior Notes set forth opposite their respective names in Schedule II bears to the aggregate underwriting obligations of all non-defaulting Underwriters, or in such other proportions as the Underwriters may specify, to purchase the Senior Notes which such defaulting Underwriter or Underwriters agreed but failed or refused to purchase. If any Underwriter or Underwriters shall so fail or refuse to purchase Senior Notes and the aggregate principal amount of the Senior Notes with respect to which such default occurs is more than one-tenth of the aggregate principal amount of the Senior Notes and arrangements satisfactory to the Underwriters and the Company for the purchase of such Senior Notes are not made within 36 hours after such default, this Agreement will terminate without liability on the part of any non-defaulting Underwriter (except as provided in paragraph 6(i) and Section 9) or of the Company (except as provided in paragraph 6(b) and Section 9). In any such case not involving a termination, either the Representative or the Company shall have the right to postpone the Closing Date, but in no event for longer than seven days, in order that the required changes, if any, in the Registration Statement and in the Prospectus or in any other documents or arrangements may be effected. Any action taken under this Section 10 shall not relieve any defaulting Underwriter from liability in respect of any default of such Underwriter under this Agreement. 11. Representations, Warranties and Agreements to Survive Delivery. All representations, warranties and agreements contained in this Agreement or contained in certificates of officers of the Company submitted pursuant hereto shall remain operative and in full force and effect regardless of any investigation made by or on behalf of any Underwriter or any controlling person of any Underwriter, or by or on behalf of the Company, and shall survive delivery of the Senior Notes. 12. Miscellaneous. The validity and interpretation of this Agreement shall be governed by the laws of the State of New York. This Agreement shall inure to the benefit of the Company, the Underwriters and, with respect to the provisions of Section 9 hereof, each controlling person and each officer and director of the Company referred to in said Section 9, and their respective successors, assigns, executors and administrators. Nothing in this Agreement is intended or shall be construed to give to any other person, firm or corporation any legal or equitable right, remedy or claim under or in respect of this Agreement or any provision herein contained. The term "successors" as used in this Agreement shall not include any purchaser, as such, of any of the Senior Notes from any of the several Underwriters. 13. Notices. All communications hereunder shall be in writing and if to the Underwriters shall be mailed, telexed, telecopied or delivered to the Representative at the address set forth on Schedule I hereto, or if to the Company shall be mailed, telexed, telecopied or delivered to it, attention of Treasurer, Virginia Electric and Power Company, 701 E. Cary Street, Richmond, Virginia 23219-3932. Please sign and return to us a counterpart of this letter, whereupon this letter will become a binding agreement between the Company and the several Underwriters in accordance with its terms. VIRGINIA ELECTRIC AND POWER COMPANY By: /s/ J.A. Shaw --------------------------- Title: Senior Vice President and Chief Financial Officer The foregoing agreement is hereby confirmed and accepted, as of the date first above written. LEHMAN BROTHERS INC. By: /s/ James C. Penrose ----------------------------- Title: Managing Director Acting individually and on behalf of the other several Underwriters named in Schedule II hereto. SCHEDULE I Title of Senior Notes: 1998 Series A 7.15% Senior Notes, due June 30, 2038 Aggregate Principal Amount: $150,000,000 Denominations: $25 and any integral multiple thereof Initial Price to Public: 100% of the principal amount of the Senior Notes plus accrued interest, if any, from the date of issuance Initial Purchase Price to be paid by Underwriters: 96.85% of the principal amount of the Senior Notes except that such price will be increased to 99% of the principal amount of the Senior Notes sold to certain institutions Concessions and reallowances to dealers and brokers: Concession: Up to $.50 per Senior Note Reallowance: Up to $.30 per Senior Note Specified funds for payment of purchase price: Federal funds (by wire transfer). Time of Delivery: June 17, 1998, 10:00 a.m. Closing Location: One James Center 901 East Cary Street Richmond, VA 23219 The Senior Notes will be available for inspection by the Representative at: One James Center 901 East Cary Street Richmond, VA 23219 Address for Notices to the Underwriters: Lehman Brothers Inc. Three World Financial Center 200 Vesey Street, 6th Floor New York, NY 10285 SCHEDULE II Principal Amount Underwriter of Senior Notes to be Purchased - ----------- ------------------------------- Lehman Brothers Inc. $ 18,437,500 A. G. Edwards & Sons, Inc. 18,437,500 Goldman, Sachs & Co. 18,437,500 Morgan Stanley & Co. Incorporated 18,437,500 Smith Barney Inc. 18,437,500 Wheat, First Securities, Inc. 18,437,500 BT Alex.Brown Incorporated 1,875,000 Bear, Stearns & Co. Inc. 1,875,000 Craigie Incorporated 1,875,000 Davenport & Company LLC 1,875,000 EVEREN Securities, Inc. 1,875,000 Janney Montgomery Scott Inc. 1,875,000 Edward D. Jones & Co., L.P. 1,875,000 Legg Mason Wood Walker, Incorporated 1,875,000 McDonald & Company Securities, Inc. 1,875,000 Prudential Securities Incorporated 1,875,000 Scott & Stringfellow, Inc. 1,875,000 Advest, Inc. 750,000 Robert W. Baird & Co. Incorporated 750,000 J.C. Bradford & Co. 750,000 JW Charles Securities, Inc. 750,000 Cowen & Company 750,000 Dain Rauscher Incorporated 750,000 Fahnestock & Co. Inc. 750,000 First Albany Corporation 750,000 Gruntal & Co., L.L.C. 750,000 J. J. B. Hilliard, W. L. Lyons, Inc. 750,000 Interstate/Johnson Lane Corporation 750,000 McGinn, Smith & Co., Inc. 750,000 Mesirow Financial, Inc. 750,000 Morgan Keegan & Company, Inc. 750,000 The Ohio Company 750,000 Olde Discount Corporation 750,000 Parker/Hunter Incorporated 750,000 Piper Jaffray Inc. 750,000 Ragen MacKenzie Incorporated 750,000 Raymond James & Associates, Inc. 750,000 The Robinson-Humphrey Company, LLC 750,000 Roney Capital Markets a division of First Chicago Capital Markets, Inc. 750,000 Stephens Inc. 750,000 Stifel, Nicolaus & Company, Incorporated 750,000 Tucker Anthony Incorporated 750,000 --------------- $150,000,000 SCHEDULE III PROPOSED FORM OF OPINION OF MAYS & VALENTINE, L.L.P. NationsBank Center 1111 East Main Street Richmond, Virginia 23219 Re: VIRGINIA ELECTRIC AND POWER COMPANY 1998 Series A ___% Senior Notes, due June 30, 2038 June ___, 1998 Lehman Brothers Inc., as Representative Three World Financial Center 200 Vesey Street, 6th Floor New York, NY 10285 Ladies and Gentlemen: We have acted as counsel for you in connection with arrangements for the issuance by Virginia Electric and Power Company (the Company) of up to U.S. $150,000,000 aggregate principal amount of its 1998 Series A ___% Senior Notes, due June 30, 2038 (the Senior Notes) under and pursuant to a Senior Indenture, dated as of June 1, 1998 between the Company and The Chase Manhattan Bank, as trustee (the Trustee), as supplemented by First Supplemental Indenture dated as of June 1, 1998 (collectively, the Senior Indenture), and the offering of the Senior Notes by you pursuant to an Underwriting Agreement dated June ___, 1998 by and between you and the Company (the Underwriting Agreement). All terms not otherwise defined herein shall have the meanings set forth in the Underwriting Agreement. We have examined originals, or copies certified to our satisfaction of such corporate records of the Company, indentures, agreements and other instruments, certificates of public officials, certificates of officers and representatives of the Company and of the Trustee, and other documents, as we have deemed necessary as a basis for the opinions hereinafter expressed. As to various questions of fact material to such opinions, we have, when relevant facts were not independently established, relied upon certifications by officers of the Company, the Trustee and other appropriate persons and statements contained in the Registration Statement hereinafter mentioned. All legal proceedings taken as of the date hereof in connection with the transactions contemplated by the Underwriting Agreement have been satisfactory to us. In addition, we attended the closing held today at the offices of McGuire, Woods, Battle & Boothe LLP, One James Center, Richmond, Virginia, at which the Company satisfied the conditions contained in Section 7 of the Underwriting Agreement that are required to be satisfied as of the Closing Date. Based upon the foregoing, and having regard to legal considerations that we deem relevant, we are of the opinion that: A. The Company is a corporation duly incorporated and existing under the laws of Virginia and is duly qualified as a foreign corporation in West Virginia and North Carolina, and has corporate power to transact its business as described in the Prospectus. B. The Underwriting Agreement has been duly authorized by all necessary corporate action and has been duly executed and delivered by the Company. C. The Senior Indenture has been duly authorized, executed and delivered by, and constitutes a valid and binding obligation of, the Company and has been duly qualified under the Trust Indenture Act, except that we express no opinion as to the validity or enforceability of any covenant to pay interest on defaulted interest, and the enforceability thereof may be limited by bankruptcy, insolvency, reorganization, moratorium or other similar laws affecting creditors' rights generally from time to time in force and general principles of equity. D. The Senior Notes have been duly authorized by the Company and, when executed by the Company and completed and authenticated by the Trustee in accordance with the Senior Indenture and delivered and paid for as provided in the Underwriting Agreement, will have been duly issued under the Senior Indenture and will constitute valid and binding obligations of the Company entitled to the benefits provided by the Senior Indenture, except that the enforceability thereof may be limited by bankruptcy, insolvency, reorganization, moratorium or other similar laws affecting creditors' rights generally from time to time in force and general principles of equity. E. The Registration Statement with respect to the Senior Notes filed pursuant to the Securities Act, has become effective and remains in effect at this date, and the Prospectus in the form filed as part of the Registration Statement, including all Incorporated Documents constituting a part thereof, may lawfully be used for the purposes specified in the Securities Act in connection with the offer for sale and the sale of Senior Notes in the manner therein specified. The Registration Statement and the Prospectus (except the financial statements incorporated by reference therein, as to which we express no opinion) appear on their face to be appropriately responsive in all material respects to the requirements of the Securities Act, and to the applicable rules and regulations of the Commission thereunder. As to the statements relating to the Senior Notes under DESCRIPTION OF THE SENIOR NOTES AND SENIOR SUBORDINATED NOTES in the prospectus initially filed as part of the Registration Statement, as supplemented by the statements under the DESCRIPTION OF THE 1998 SERIES A SENIOR NOTES in the Prospectus Supplement dated June __, 1998 (the Prospectus Supplement), we are of the opinion that the statements are accurate and do not omit any material fact required to be stated therein or necessary to make such statements not misleading. As to the statistical statements in the Registration Statement (which includes the Incorporated Documents), we have relied solely on the officers of the Company. As to the other matters, we have not undertaken to determine independently the accuracy or completeness of the statements contained or incorporated by reference in the Registration Statement or in the Prospectus. We accordingly assume no responsibility for the accuracy or completeness of the statements made in the Registration Statement except as stated above in regard to the above captions. We note that we were not involved in the preparation of the Registration Statement or the prospectus initially filed as part thereof, and that the Incorporated Documents were prepared and filed by the Company without our participation. We have, however, participated in conferences with counsel for and representatives of the Company in connection with the preparation of the Prospectus Supplement, and we have reviewed the Incorporated Documents and such of the corporate records of the Company as we deemed advisable. None of the foregoing disclosed to us any information that gives us reason to believe that the Registration Statement or the Prospectus contained (except the financial statements incorporated by reference therein, as to which we express no opinion) on the date the Registration Statement became effective or now contains any untrue statement of a material fact or omitted on said date or now omits to state a material fact required to be stated therein or necessary to make the statements therein not misleading. The foregoing opinion is given on the basis that any statement contained in an Incorporated Document shall be deemed not to be contained in the Registration Statement or Prospectus if the statement has been modified or superseded by any statement in a subsequently filed Incorporated Document or in the Registration Statement or Prospectus. F. An appropriate order of the Virginia Commission with respect to the sale of the Senior Notes on the terms and conditions set forth in the Underwriting Agreement has been issued, and said order remains in effect at this date and constitutes valid and sufficient authorization for the sale of the Senior Notes as contemplated by the Underwriting Agreement. We understand said order does not contain any provision unacceptable to you under the Underwriting Agreement. No approval or consent by any public regulatory body, other than such order and notification of effectiveness by the Commission, is legally required in connection with the sale of the Senior Notes as contemplated by the Underwriting Agreement (except to the extent that compliance with the provisions of securities or blue-sky laws of certain states may be required in connection with the sale of the Senior Notes in such states) and the carrying out of the provisions of the Underwriting Agreement. G. The Senior Notes conform to their description in the Underwriting Agreement and to the statements with respect thereto contained in the Registration Statement and the Prospectus. Very truly yours, MAYS & VALENTINE, L.L.P. SCHEDULE IV PROPOSED FORM OF OPINION OF MCGUIRE, WOODS, BATTLE & BOOTHE LLP One James Center 901 East Cary Street Richmond, Virginia 23219 Re: VIRGINIA ELECTRIC AND POWER COMPANY IV - 1 1998 Series A ___% Senior Notes due June 30, 2038 June ___, 1998 Lehman Brothers Inc., as Representative Three World Financial Center 200 Vesey Street, 6th Floor New York, NY 10285 Ladies and Gentlemen: The arrangements for issuance of up to U.S. $150,000,000 aggregate principal amount of 1998 Series A ___% Senior Notes, due June 30, 2038 (the Senior Notes), of Virginia Electric and Power Company (the Company) under a Senior Indenture dated as of June 1, 1998 between the Company and The Chase Manhattan Bank, as trustee (the Trustee), as supplemented by a First Supplemental Indenture dated as of June 1, 1998 (collectively, the Senior Indenture), and pursuant to an Underwriting Agreement dated June ___, 1998 by and between the Company and the Underwriters listed on Schedule II as attached thereto (the Underwriting Agreement), have been taken under our supervision as counsel for the Company. Terms not otherwise defined herein have the meanings set forth in the Underwriting Agreement. We have examined originals, or copies certified to our satisfaction, of such corporate records of the Company, indentures, agreements, and other instruments, certificates of public officials, certificates of officers and representatives of the Company and of the Trustee, and other documents, as we have deemed it necessary to require as a basis for the opinions hereinafter expressed. As to various questions of fact material to such opinions, we have, when relevant facts were not independently established, relied upon certifications by officers of the Company, the Trustee and other appropriate persons and statements contained in the Registration Statement hereinafter mentioned. All legal proceedings taken as of the date hereof in connection with the transactions contemplated by the Underwriting Agreement have been satisfactory to us. In regard to the title of the Company to its properties, we have made no independent investigation of original records but our opinion is based (a) with respect to land and rights of way for electric lines of 69,000 volts or more, solely on reports and opinions by counsel in whom we have confidence and (b) with respect to rights of way for electric lines of less than 69,000 volts and various matters of fact in regard to all other properties, solely on information from officers of the Company. On this basis we are of the opinion that: 1. The Company is a corporation duly organized and existing under the laws of Virginia and is duly qualified as a foreign corporation in West Virginia and North Carolina. Neither the nature of the Company's business nor the properties it owns or holds under lease makes necessary qualification as a foreign corporation in any state where it is not now so qualified or where the failure to be so qualified would have a material adverse effect on the Company and its subsidiaries taken as a whole, and the Company has corporate power to conduct its business and to issue the Senior Notes. 2. All requisite corporate and governmental authorizations have been given for the issuance of the Senior Notes under the Senior Indenture. 3. The Underwriting Agreement has been duly authorized by all necessary corporate action and has been duly executed and delivered by the Company. 4. The Senior Indenture has been duly authorized, executed, and delivered by, and constitutes a valid and binding obligation of, the Company and has been duly qualified under the Trust Indenture Act, except that we express no opinion as to the validity or enforceability of any covenant to pay interest on defaulted interest and except that the enforceability thereof may be limited by bankruptcy, insolvency, reorganization, moratorium or other similar laws affecting creditors' rights generally from time to time in force and general principles of equity. 5. The Senior Notes have been duly authorized by the Company and, when duly executed by the Company and completed and authenticated by the Trustee in accordance with the Senior Indenture and issued, delivered and paid for in accordance with the Underwriting Agreement, will have been duly issued under the Senior Indenture and will constitute valid and binding obligations of the Company entitled to the benefits provided by the Senior Indenture, except that the enforceability thereof may be limited by bankruptcy, insolvency, reorganization, moratorium or other similar laws affecting creditors' rights generally from time to time in force and general principles of equity. 6. The Registration Statement with respect to the Senior Notes filed pursuant to the Securities Act, has become effective and remains in effect at this date, and the Prospectus may lawfully be used for the purposes specified in the Securities Act in connection with the offer for sale and the sale of the Senior Notes in the manner therein specified. The statements in regard to our firm under the caption EXPERTS in the Prospectus relating to the Senior Notes are correct, and we are of the opinion that, so far as governed by the laws of the United States, North Carolina or Virginia, the legal conclusions relating to franchises, title to its properties, rates, environmental and other regulatory matters and litigation in the Company's Annual Report on Form 10-K incorporated in the Prospectus by reference and the description of the provisions of the Senior Indenture and the terms of the Senior Notes contained in the prospectus initially filed as part of the Registration Statement under DESCRIPTION OF THE SENIOR NOTES AND SENIOR SUBORDINATED NOTES, as supplemented by the statements under DESCRIPTION OF THE 1998 SERIES A SENIOR NOTES in the Prospectus Supplement dated June ___, 1998, are substantially accurate and fair. As to the statistical statements in the Registration Statement (which includes the Incorporated Documents), we have relied solely on the officers of the Company. As to other matters of fact, we have consulted with officers and other employees of the Company to inform them of the disclosure requirements of the Securities Act. We have examined various reports, records, contracts and other documents of the Company and orders and instruments of public officials, which our investigation led us to deem pertinent. In addition, we attended the due diligence meetings with representatives of the Company and the closing at which the Company satisfied the conditions contained in Section 7 of the Underwriting Agreement. We have not, however, undertaken to make any independent review of the other records of the Company. We accordingly assume no responsibility for the accuracy or completeness of the statements made in the Registration Statement except as stated above in regard to the aforesaid captions. But such consultation, examination and attendance disclosed to us no information with respect to such other matters that gives us reason to believe that the Registration Statement or the Prospectus contained on the date the Registration Statement became effective or contains now any untrue statement of a material fact or omitted on said date or omits now to state a material fact required to be stated therein or necessary to make the statements therein not misleading. We are of the opinion that the Registration Statement (excepting the financial statements incorporated therein by reference, as to which we express no opinion) complies as to form in all material respects with all legal requirements and is now effective. The Registration Statement and the Prospectus (except the financial statements incorporated by reference therein, as to which we express no opinion) appear on their face to be appropriately responsive in all material respects to the requirements of the Securities Act, and to the applicable rules and regulations of the Commission thereunder. 7. The titles and interests of the Company in and to its properties are reasonably adequate to enable the Company to carry on its business and the Company holds such franchises, permits and licenses as are reasonably adequate to enable the Company to carry on its business, and, as to any franchises, permits and licenses that the Company does not hold, the absence thereof will not materially adversely affect the operation, business and properties of the Company as a whole. 8. Except as set forth in the Registration Statement, there are no pending legal, administrative or judicial proceedings with respect to the Company that are required to be described in Form S-3. The opinions in paragraphs 6 and 8 hereof are given on the basis that any statement contained in an Incorporated Document shall be deemed not to be contained in the Registration Statement or Prospectus if the statement has been modified or superseded by any statement in a subsequently filed Incorporated Document or in the Registration Statement or Prospectus. Yours very truly, MCGUIRE, WOODS, BATTLE & BOOTHE LLP EX-4.2 3 EXHIBIT 4.2 - FIRST SUPPLEMENTAL INDENTURE VIRGINIA ELECTRIC AND POWER COMPANY TO THE CHASE MANHATTAN BANK Trustee ------------------------- First Supplemental Indenture Dated as of June 1 , 1998 ------------------------- $150,000,000 1998 Series A 7.15% Senior Notes due June 30, 2038 TABLE OF CONTENTS 1 ARTICLE 1 SERIES A 7.15% SENIOR NOTES
SECTION 101. Establishment............................................ 1 SECTION 102. Definitions.............................................. 2 SECTION 103. Payment of Principal and Interest........................ 4 SECTION 104. Denominations............................................ 5 SECTION 105. Global Securities........................................ 5 SECTION 106. Redemption............................................... 6 SECTION 107. Additional Interest...................................... 7 SECTION 108. Listing of Series A Notes................................ 9 SECTION 109. Paying Agent............................................. 9 ARTICLE 2 MISCELLANEOUS PROVISIONS SECTION 201. Recitals by Corporation.................................. 10 SECTION 202. Ratification and Incorporation of Original Indenture..... 10 SECTION 203. Executed in Counterparts................................. 10 SECTION 204. Assignment............................................... 10 - -------- (1) This Table of Contents does not constitute part of the Indenture or have any bearing upon the interpretation of any of its terms and provisions. THIS FIRST SUPPLEMENTAL INDENTURE is made as of the first day of June, 1998, by and between VIRGINIA ELECTRIC AND POWER COMPANY, a Virginia corporation, having its principal office at 701 East Cary Street, Richmond, Virginia 23219-3932 (the "Corporation"), and THE CHASE MANHATTAN BANK, a New York banking corporation, as Trustee (herein called the "Trustee"). W I T N E S S E T H: WHEREAS, the Corporation has heretofore entered into a Senior Indenture, dated as of June 1, 1998 (the "Original Indenture") with The Chase Manhattan Bank; WHEREAS, the Original Indenture is incorporated herein by this reference and the Original Indenture, as supplemented by this First Supplemental Indenture, is herein called the "Indenture"; WHEREAS, under the Original Indenture, a new series of Securities may at any time be established in accordance with the provisions of the Original Indenture and the terms of such series may be described by a supplemental indenture executed by the Corporation and the Trustee; WHEREAS, the Corporation proposes to create under the Indenture a series of Securities; WHEREAS, additional Securities of other series hereafter established, except as may be limited in the Original Indenture as at the time supplemented and modified, may be issued from time to time pursuant to the Indenture as at the time supplemented and modified; and WHEREAS, all conditions necessary to authorize the execution and delivery of this First Supplemental Indenture and to make it a valid and binding obligation of the Corporation have been done or performed. NOW, THEREFORE, in consideration of the agreements and obligations set forth herein and for other good and valuable consideration, the sufficiency of which is hereby acknowledged, the parties hereto hereby agree as follows: ARTICLE 1 1998 SERIES A 7.15% SENIOR NOTES SECTION 101. Establishment. There is hereby established a new series of Securities to be issued under the Indenture, to be designated as the Corporation's 1998 Series A 7.15 % Senior Notes, due June 30, 2038 (the "Series A Notes"). There are to be authenticated and delivered $150,000,000 principal amount of Series A Notes, and no further Series A Notes shall be authenticated and delivered except as provided by Sections 304, 305, 306, 906 or 1106 of the Original Indenture. The Series A Notes shall be issued in definitive fully registered form without coupons. The Series A Notes shall be in substantially the form set out in Exhibit A hereto. The entire principal amount of the Series A Notes shall initially be evidenced by one certificate issued to Cede & Co. The form of the Trustee's Certificate of Authentication for the Series A Notes shall be in substantially the form set forth in Exhibit B hereto. Each Series A Note shall be dated the date of authentication thereof and shall bear interest from the date of original issuance thereof or from the most recent Interest Payment Date to which interest has been paid or duly provided for. SECTION 102. Definitions. The following defined terms used herein shall, unless the context otherwise requires, have the meanings specified below. Capitalized terms used herein for which no definition is provided herein shall have the meanings set forth in the Original Indenture. "Business Day" means a day other than (i) a Saturday or a Sunday, (ii) a day on which banks in New York, New York are authorized or obligated by law or executive order to remain closed or (iii) a day on which the Corporate Trust Office is closed for business. "Interest Payment Dates" means March 31, June 30, September 30 and December 31 of each year. "Original Issue Date" means June 17, 1998. "Outstanding", when used with respect to the Series A Notes, means, as of the date of determination, all Series A Notes, theretofore authenticated and delivered under the Indenture, except: (i) Series A Notes theretofore canceled by the Trustee or delivered to the Trustee for cancellation; (ii) Series A Notes for whose payment or redemption the necessary amount of money or money's worth has been theretofore deposited with the Trustee or any Paying Agent (other than the Corporation) in trust or set aside and segregated in trust by the Corporation (if the Corporation shall act as its own Paying Agent) for the Holders of such Series A Notes; provided that if such Series A Notes are to be redeemed, notice of such redemption has been duly given pursuant to the Indenture or provision therefor satisfactory to the Trustee has been made; (iii) Series A Notes as to which Defeasance has been effected pursuant to Section 1302 of the Original Indenture; and (iv) Series A Notes that have been paid pursuant to Section 306 or in exchange for or in lieu of which other Series A Notes have been authenticated and delivered pursuant to the Indenture, other than any such Series A Notes in respect of which there shall have been presented to the Trustee proof satisfactory to it that such Series A Notes are held by a bona fide purchaser in whose hands such Series A Notes are valid obligations of the Corporation; provided, however, that in determining, during any period in which any Series A Notes are owned by any Person other than the Corporation or any Affiliate thereof, whether the Holders of the requisite principal amount of Outstanding Series A Notes have given, made or taken any request, demand, authorization, direction, notice, consent, waiver or other action hereunder as of any date, Series A Notes owned, whether of record or beneficially, by the Corporation or any Affiliate thereof shall be disregarded and deemed not to be Outstanding. In determining whether the Trustee shall be protected in relying upon such request, demand, authorization, direction, notice, consent, waiver or other action, only Series A Notes that the Trustee knows to be so owned by the Corporation or an Affiliate of the Corporation in the above circumstances shall be so disregarded. Series A Notes so owned that have been pledged in good faith may be regarded as Outstanding if the pledgee establishes to the satisfaction of the Trustee the pledgee's right so to act with respect to such Series A Notes and that the pledgee is not the Corporation or any Affiliate of the Corporation. "Regular Record Date" means, with respect to each Interest Payment Date, the close of business on the 15th calendar day preceding such Interest Payment Date. "Stated Maturity" means June 30, 2038. SECTION 103. Payment of Principal and Interest. The principal of the Series A Notes shall be due at the Stated Maturity (subject to earlier redemption). The unpaid principal amount of the Series A Notes shall bear interest at the rate of 7.15% per annum until paid or duly provided for, such interest to accrue from the Original Issue Date or from the most recent Interest Payment Date to which interest has been paid or duly provided for. Interest shall be paid quarterly in arrears on each Interest Payment Date to the Person in whose name the Series A Notes are registered on the Regular Record Date for such Interest Payment Date; provided that interest payable at the Stated Maturity of principal or on a Redemption Date as provided herein will be paid to the Person to whom principal is payable. Any such interest that is not so punctually paid or duly provided for will forthwith cease to be payable to the Holders on such Regular Record Date and may either be paid to the Person or Persons in whose name the Series A Notes are registered at the close of business on a Special Record Date for the payment of such defaulted interest to be fixed by the Trustee ("Special Record Date"), notice whereof shall be given to Holders of the Series A Notes not less than ten (10) days prior to such Special Record Date, or be paid at any time in any other lawful manner not inconsistent with the requirements of any securities exchange, if any, on which the Series A Notes may be listed, and upon such notice as may be required by any such exchange, all as more fully provided in the Original Indenture. Payments of interest on the Series A Notes will include interest accrued to but excluding the respective Interest Payment Dates. Interest payments for the Series A Notes shall be computed and paid on the basis of a 360-day year of twelve 30-day months. In the event that any date on which interest is payable on the Series A Notes is not a Business Day, then payment of the interest payable on such date will be made on the next succeeding day that is a Business Day (and without any interest or payment in respect of any such delay), except that, if such Business Day is in the next succeeding calendar year, such payment shall be made on the immediately preceding Business Day, in each case with the same force and effect as if made on the date the payment was originally payable. Payment of the principal and interest on the Series A Notes shall be made at the office of the Paying Agent in such coin or currency of the United States of America as at the time of payment is legal tender for payment of public and private debts, with any such payment that is due at the Stated Maturity or at earlier redemption of any Series A Notes being made upon surrender of such Series A Notes to the Paying Agent. Payments of interest (including interest on any Interest Payment Date) will be made, subject to such surrender where applicable, at the option of the Corporation, (i) by check mailed to the address of the Person entitled thereto as such address shall appear in the Security Register or (ii) by wire transfer at such place and to such account at a banking institution in the United States as may be designated in writing to the Trustee at least sixteen (16) days prior to the date for payment by the Person entitled thereto. In the event that any date on which principal and interest is payable on the Series A Notes is not a Business Day, then payment of the principal and interest payable on such date will be made on the next succeeding day that is a Business Day (and without any interest or payment in respect of any such delay), except that, if such Business Day is in the next succeeding calendar year, such payment shall be made on the immediately preceding Business Day, in each case with the same force and effect as if made on the date the payment was originally payable. SECTION 104. Denominations. The Series A Notes may be issued in denominations of $25, or any integral multiple thereof. SECTION 105. Global Securities. The Series A Notes will be issued initially in the form of one or more Global Securities registered in the name of the Depositary (which shall be The Depository Trust Company) or its nominee. Except under the limited circumstances described below, Series A Notes represented by such Global Security or Global Securities will not be exchangeable for, and will not otherwise be issuable as, Series A Notes in definitive form. The Global Securities described above may not be transferred except by the Depositary to a nominee of the Depositary or by a nominee of the Depositary to the Depositary or another nominee of the Depositary or to a successor Depositary or its nominee. Owners of beneficial interests in such a Global Security will not be considered the Holders thereof for any purpose under the Indenture, and no Global Security representing a Series A Note shall be exchangeable, except for another Global Security of like denomination and tenor to be registered in the name of the Depositary or its nominee or to a successor Depositary or its nominee or except as described below. The rights of Holders of such Global Security shall be exercised only through the Depositary. A Global Security shall be exchangeable for Series A Notes registered in the names of persons other than the Depositary or its nominee only if (i) the Depositary notifies the Corporation that it is unwilling or unable to continue as a Depositary for such Global Security and no successor Depositary shall have been appointed by the Corporation within 90 days of receipt by the Corporation of such notification, or if at any time the Depositary ceases to be a clearing agency registered under the Exchange Act at a time when the Depositary is required to be so registered to act as such Depositary and no successor Depositary shall have been appointed by the Corporation within 90 days after it becomes aware of such cessation, or (ii) the Corporation in its sole discretion determines that such Global Security shall be so exchangeable. Any Global Security that is exchangeable pursuant to the preceding sentence shall be exchangeable for Series A Notes registered in such names as the Depositary shall direct. SECTION 106. Redemption. The Series A Notes shall be subject to redemption at the option of the Corporation, in whole or in part, without premium or penalty, at any time or from time to time on or after June 30, 2003, at a Redemption Price equal to 100% of the principal amount to be redeemed plus accrued but unpaid interest to the Redemption Date. The election of the Corporation to redeem, in whole or in part, the Series A Notes shall be evidenced by an Officers' Certificate. In the event of redemption of the Series A Notes in part only, a new Series A Note or Notes for the unredeemed portion shall be issued in the name or names of the Holders thereof upon the surrender thereof. The Series A Notes shall not have a sinking fund. Notice of redemption shall be given as provided in Section 1104 of the Original Indenture. Any redemption of less than all of the Series A Notes shall, with respect to the principal thereof, be divisible by $25. SECTION 107. Additional Interest. Any principal of and instalment of interest on the Series A Notes that is overdue shall bear interest at the rate of 7.15% (to the extent that the payment of such interest shall be legally enforceable), from the dates such amounts are due until they are paid or made available for payment, and such interest shall be payable on demand. SECTION 108. Listing of Series A Notes. The Corporation shall use its best efforts to list the Series A Notes on the New York Stock Exchange or any other exchange on which the Corporation's securities are listed. The Corporation shall notify the Trustee if and when the Series A Notes become admitted to trading on the New York Stock Exchange or any other national securities exchange. SECTION 109. Paying Agent. The Trustee shall initially serve as Paying Agent with respect to the Series A Notes, with the Place of Payment initially being the Corporate Trust Office of the Trustee. ARTICLE 2 MISCELLANEOUS PROVISIONS SECTION 201. Recitals by Corporation. The recitals in this First Supplemental Indenture are made by the Corporation only and not by the Trustee, and all of the provisions contained in the Original Indenture in respect of the rights, privileges, immunities, powers and duties of the Trustee shall be applicable in respect of the Series A Notes and of this First Supplemental Indenture as fully and with like effect as if set forth herein in full. SECTION 202. Ratification and Incorporation of Original Indenture. As supplemented hereby, the Original Indenture is in all respects ratified and confirmed, and the Original Indenture and this First Supplemental Indenture shall be read, taken and construed as one and the same instrument. SECTION 203. Executed in Counterparts. This Supplemental Indenture may be executed in several counterparts, each of which shall be deemed to be an original, and such counterparts shall together constitute but one and the same instrument. SECTION 204. Assignment. The Corporation shall have the right at all times to assign any of its rights or obligations under this Indenture with respect to the Series A Notes to a direct or indirect wholly-owned subsidiary of the Corporation; provided that, in the event of any such assignment, the Corporation shall remain primarily liable for the performance of all such obligations. The Indenture may also be assigned by the Corporation in connection with a transaction described in Article Eight of the Original Indenture. IN WITNESS WHEREOF, each party hereto has caused this instrument to be signed in its name and behalf by its duly authorized officers, all as of the day and year first above written. VIRGINIA ELECTRIC AND POWER COMPANY By: ______________________ Attest: - --------------------------------- THE CHASE MANHATTAN BANK, as Trustee By: ______________________ Attest: - ---------------------------------- EXHIBIT A FORM OF 1998 SERIES A 7.15% SENIOR NOTE, DUE JUNE 30, 2038 [UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY (55 WATER STREET, NEW YORK, NEW YORK) TO THE ISSUER OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF [CEDE & CO.] OR SUCH OTHER NAME AS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY AND ANY PAYMENT IS MADE TO [CEDE & CO.], ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL SINCE THE REGISTERED OWNER HEREOF, [CEDE & CO.,] HAS AN INTEREST HEREIN.]** [THIS SECURITY IS A GLOBAL SECURITY WITHIN THE MEANING OF THE INDENTURE HEREINAFTER REFERRED TO AND IS REGISTERED IN THE NAME OF A DEPOSITARY OR A NOMINEE THEREOF. THIS SECURITY MAY NOT BE EXCHANGED IN WHOLE OR IN PART FOR A SECURITY REGISTERED, AND NO TRANSFER OF THIS SECURITY IN WHOLE OR IN PART MAY BE REGISTERED, IN THE NAME OF ANY PERSON OTHER THAN SUCH DEPOSITARY OR A NOMINEE THEREOF, EXCEPT IN THE LIMITED CIRCUMSTANCES DESCRIBED IN THE INDENTURE.]** -------------------------- VIRGINIA ELECTRIC AND POWER COMPANY -------------------------- $____________ 1998 SERIES A 7.15% SENIOR NOTE, DUE JUNE 30, 2038 - -------------------- **Insert in Global Securities. No. ___ CUSIP No. ____ Virginia Electric and Power Company, a corporation duly organized and existing under the laws of Virginia (herein called the "Company", which term includes any successor Person under the Indenture hereinafter referred to), for value received, hereby promises to pay to [Cede & Co.]**, or registered assigns (the "Holder"), the principal sum of __________________ Dollars ($______________) on June 30, 2038, and to pay interest thereon from June __, 1998 or from the most recent Interest Payment Date to which interest has been paid or duly provided for, quarterly on March 31, June 30, September 30 and December 31 in each year, commencing June 30, 1998, at the rate of 7.15% per annum, until the principal hereof is paid or made available for payment provided that any principal and premium, and any such instalment of interest, that is overdue shall bear interest at the rate of 7.15% per annum (to the extent that the payment of such interest shall be legally enforceable), from the dates such amounts are due until they are paid or made available for payment, and such interest shall be payable on demand. The interest so payable, and punctually paid or duly provided for, on any Interest Payment Date will, as provided in such Indenture, be paid to the Person in whose name this Security (or one or more Predecessor Securities) is registered at the close of business on the Regular Record Date for such interest, which shall be the fifteenth calendar day (whether or not a Business Day), as the case may be, next preceding such Interest Payment Date. Any such interest not so punctually paid or duly provided for will forthwith cease to be payable to the Holder on such Regular Record Date and may either be paid to the Person in whose name this Security (or one or more Predecessor Securities) is registered at the close of business on a Special Record Date for the payment of such Defaulted Interest to be fixed by the Trustee, notice whereof shall be given to Holders of Securities of this series not less than 10 days prior to such Special Record Date, or be paid at any time in any other lawful manner not inconsistent with the requirements of any securities exchange on which the Securities of this series may be listed, and upon such notice as may be required by such exchange, all as more fully provided in said Indenture. Payment of the principal of (and premium, if any) and any such interest on this Security will be made at the office of the Paying Agent, in such coin or currency of the United States of America as at the time of payment is legal tender for payment of public and private debts; provided, however, that at the option of the Company payment of interest may be made (i) by check mailed to the address of the Person entitled thereto as such address shall appear in the Security Register or (ii) by wire transfer at such place and to such account at a banking institution in the United States as may be designated in writing to the Trustee at least sixteen (16) days prior to the date for payment by the Person entitled thereto. Reference is hereby made to the further provisions of this Security set forth on the reverse hereof, which further provisions shall for all purposes have the same effect as if set forth at this place. Unless the certificate of authentication hereon has been executed by the Trustee referred to on the reverse hereof by manual signature, this Security shall not be entitled to any benefit under the Indenture or be valid or obligatory for any purpose. IN WITNESS WHEREOF, the Company has caused this instrument to be duly executed under its corporate seal. Virginia Electric and Power Company By_________________________________ Attest: - ------------------------------ [REVERSE OF SECURITY] This Security is one of a duly authorized issue of securities of the Company (herein called the "Securities"), issued and to be issued in one or more series under a Senior Indenture, dated as of June 1, 1998, as supplemented by the First Supplemental Indenture dated as of June 1, 1998 (as amended or supplemented from time to time, herein called the "Indenture", which term shall have the meaning assigned to it in such instrument), between the Company and The Chase Manhattan Bank, as Trustee (herein called the "Trustee", which term includes any successor trustee under the Indenture), and reference is hereby made to the Indenture for a statement of the respective rights, limitations of rights, duties and immunities thereunder of the Company, the Trustee and the Holders of the Securities and of the terms upon which the Securities are, and are to be, authenticated and delivered. This Security is one of the series designated on the face hereof limited in aggregate principal amount to $150,000,000. The Securities of this series are subject to redemption upon not less than 30 days notice by mail, at any time on or after June 30, 2003, as a whole or in part, at the election of the Company, at a Redemption Price equal to 100% of the principal amount, together in the case of any such redemption with accrued interest to the Redemption Date, but interest installments whose Stated Maturity is on or prior to such Redemption Date will be payable to the Holders of such Securities, or one or more Predecessor Securities, of record at the close of business on the relevant Record Dates referred to on the face hereof, all as provided in the Indenture. In the event of redemption of this Security in part only, a new Security or Securities of this series and of like tenor for the unredeemed portion hereof will be issued in the name of the Holder hereof upon the cancellation hereof. If an Event of Default with respect to Securities of this series shall occur and be continuing, the principal of the Securities of this series may be declared due and payable in the manner and with the effect provided in the Indenture. The Indenture permits, with certain exceptions as therein provided, the amendment thereof and the modification of the rights and obligations of the Company and the rights of the Holders of the Securities of each series to be affected under the Indenture at any time by the Company and the Trustee with the consent of the Holders of a majority in principal amount of the Securities at the time Outstanding of each series to be affected. The Indenture also contains provisions permitting the Holders of specified percentages in principal amount of the Securities of each series at the time Outstanding, on behalf of the Holders of all Securities of such series, to waive compliance by the Company with certain provisions of the Indenture and certain past defaults under the Indenture and their consequences. Any such consent or waiver by the Holder of this Security shall be conclusive and binding upon such Holder and upon all future Holders of this Security and of any Security issued upon the registration of transfer hereof or in exchange therefor or in lieu hereof, whether or not notation of such consent or waiver is made upon this Security. As provided in and subject to the provisions of the Indenture, the Holder of this Security shall not have the right to institute any proceeding with respect to the Indenture or for the appointment of a receiver or trustee or for any other remedy thereunder, unless such Holder shall have previously given the Trustee written notice of a continuing Event of Default with respect to the Securities of this series, the Holders of not less than a majority in principal amount of the Securities of this series at the time Outstanding shall have made written request to the Trustee to institute proceedings in respect of such Event of Default as Trustee and offered the Trustee reasonable indemnity, and the Trustee shall not have received from the Holders of a majority in principal amount of Securities of this series at the time Outstanding a direction inconsistent with such request, and shall have failed to institute any such proceeding for 60 days after receipt of such notice, request and offer of indemnity. The foregoing shall not apply to any suit instituted by the Holder of this Security for the enforcement of any payment of principal hereof or any premium or interest hereon on or after the respective due dates expressed or provided for herein. No reference herein to the Indenture and no provision of this Security or of the Indenture shall alter or impair the obligation of the Company, which is absolute and unconditional, to pay the principal of and any premium and interest on this Security at the times, place and rate, and in the coin or currency, herein prescribed. As provided in the Indenture and subject to certain limitations therein set forth, the transfer of this Security is registrable in the Security Register, upon surrender of this Security for registration of transfer at the office or agency of the Company in any place where the principal of and any premium and interest on this Security are payable, duly endorsed by, or accompanied by a written instrument of transfer in form satisfactory to the Company and the Security Registrar duly executed by, the Holder hereof or his attorney duly authorized in writing, and thereupon one or more new Securities of this series and of like tenor, of authorized denominations and for the same aggregate principal amount, will be issued to the designated transferee or transferees. The Securities of this series are issuable only in registered form without coupons in denominations of $25.00 and any integral multiple thereof. As provided in the Indenture and subject to certain limitations therein set forth, Securities of this series are exchangeable for a like aggregate principal amount of Securities of this series having the same Stated Maturity and of like tenor of any authorized denominations as requested by the Holder upon surrender of the Note or Notes to be exchanged at the office or agency of the Company. No service charge shall be made for any such registration of transfer or exchange, but the Company may require payment of a sum sufficient to cover any tax or other governmental charge payable in connection therewith. Prior to due presentment of this Security for registration of transfer, the Company, the Trustee and any agent of the Company or the Trustee may treat the Person in whose name this Security is registered as the owner hereof for all purposes, whether or not this Security be overdue, and neither the Company, the Trustee nor any such agent shall be affected by notice to the contrary. All terms used in this Security that are defined in the Indenture shall have the meanings assigned to them in the Indenture. ABBREVIATIONS The following abbreviations, when used in the inscription on the face of this instrument, shall be construed as though they were written out in full according to applicable laws or regulations: TEN COM -- as tenants in common TEN ENT -- as tenants by the entireties JT TEN -- as joint tenants with rights of survivorship and not as tenants in common UNIF GIFT MIN ACT -- ________________________Custodian for (Cust) ---------------------------- (Minor) Under Uniform Gifts to Minors Act of ----------------------------- (State) Additional abbreviations may also be used though not on the above list. - ------------------------------- FOR VALUE RECEIVED, the undersigned hereby sell(s) and transfer(s)unto ____________________ (please insert Social Security or other identifying number of assignee). - --------------------------------------------------------------------------- - --------------------------------------------------------------------------- - --------------------------------------------------------------------------- PLEASE PRINT OR TYPEWRITE NAME AND ADDRESS, INCLUDING POSTAL ZIP CODE OF ASSIGNEE the within Security and all rights thereunder, hereby irrevocably constituting and appointing - ---------------------------------------------------------------------------- - ---------------------------------------------------------------------------- - ---------------------------------------------------------------------------- agent to transfer said Security on the books of the Corporation, with full power of substitution in the premises. Dated: __________________ __, ____ ---------------------------- NOTICE: The signature to this assignment must correspond with the name as written upon the face of the within instrument in every particular without alteration or enlargement, or any change whatever. EXHIBIT B CERTIFICATE OF AUTHENTICATION This is one of the Securities of the series designated therein referred to in the within-mentioned Indenture. THE CHASE MANHATTAN BANK, as Trustee By: _____________________ Authorized Officer
EX-12 4 EXHIBIT 12 Exhibit 12
VIRGINIA ELECTRIC AND POWER COMPANY COMPUTATION OF RATIO OF EARNINGS TO FIXED CHARGES (thousands of dollars) Twelve Months Ended --------------------------------------------------------------------------------------------- Mar-98 Dec-97 Dec-96 Dec-95 Dec-94 Dec-93 ---------- ---------- --------- ---------- ---------- ---------- Net Income $457,385 $469,114 $457,304 $432,844 $447,144 $509,051 Add: Income Taxes 246,824 249,293 243,993 228,785 225,647 257,217 ---------- ---------- --------- ---------- ---------- ---------- Total Pretax Net Income $704,209 $718,407 $701,297 $661,629 $672,791 $766,268 ========== ========== ========= ========== ========== ========== Fixed Charges: Interest on Long-Term Debt $302,051 $274,850 $287,928 $302,618 $291,864 $300,152 Other Interest inc. above 30,703 22,380 19,998 7,551 19,121 Paid Distribution of Affiliate 10,868 10,868 10,867 3,653 Estimated Interest Factor of Rents Charged to Operating Expenses, Clearing & Other Accounts 9,228 8,595 6,291 6,475 7,132 5,660 ---------- ---------- --------- ---------- ---------- ---------- Total Fixed Charges $322,147 $325,016 $327,466 $332,744 $306,547 $324,933 ========== ========== ========= ========== ========== ========== Earnings as Defined $1,026,356 $1,043,423 $1,028,763 $994,373 $979,338 $1,091,201 ========== ========== ========= ========== ========== ========== Ratio of Earnings to Fixed Charges 3.19 3.21 3.14 2.99 3.19 3.36 ========== ========== ========= ========== ========== ==========
EX-23 5 EXHIBIT 23 - CONSENT OF MCGUIRE, WOODS, BATTLE & BOOTHE LLP June 12, 1998 Virginia Electric and Power Company 701 E. Cary Street Richmond, Virginia 23219 Virginia Electric and Power Company 1998 Series A 7.15% Senior Notes, due June 30, 2038 Ladies and Gentlemen: We hereby consent to the statements made in regard to our firm under the captions EXPERTS and LEGAL OPINIONS in the Prospectus included in the Registration Statement on Form S-3 of Virginia Electric and Power Company dated March 18, 1998, by means of the Prospectus Supplement filed June 12, 1998. Very truly yours, /s/ MCGUIRE, WOODS, BATTLE & BOOTHE LLP --------------------------------------- MCGUIRE, WOODS, BATTLE & BOOTHE LLP -----END PRIVACY-ENHANCED MESSAGE-----