-----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, QuQQNry7iso0D/5YTpCpz0dsjYM0Mu2dRH8Gk0fjv13K93Mu80YL94PSq9pvscVU oWkSdL0AHDNdyDjSEuTxnQ== /in/edgar/work/20000602/0000950130-00-003259/0000950130-00-003259.txt : 20000919 0000950130-00-003259.hdr.sgml : 20000919 ACCESSION NUMBER: 0000950130-00-003259 CONFORMED SUBMISSION TYPE: S-3 PUBLIC DOCUMENT COUNT: 25 REFERENCES 429: 033-50425 REFERENCES 429: 333-20561 FILED AS OF DATE: 20000602 FILER: COMPANY DATA: COMPANY CONFORMED NAME: VIRGINIA ELECTRIC & POWER CO CENTRAL INDEX KEY: 0000103682 STANDARD INDUSTRIAL CLASSIFICATION: [4911 ] IRS NUMBER: 540418825 STATE OF INCORPORATION: VA FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: S-3 SEC ACT: SEC FILE NUMBER: 333-38510 FILM NUMBER: 648719 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 S-3 1 0001.txt FORM S-3 As Filed with the Securities and Exchange Commission on June , 2000 File No. 333- - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 -------------- FORM S-3 REGISTRATION STATEMENT Under The Securities Act of 1933 -------------- VIRGINIA ELECTRIC AND VIRGINIA 54-418825 POWER COMPANY (State or other (I.R.S. Employer (Exact name of jurisdiction of Identification No.) registrant as specified incorporation or in its charter) organization) VIRGINIA POWER CAPITAL DELAWARE APPLIED FOR TRUST II (State or other (I.R.S. Employer (Exact name of jurisdiction of Identification No.) registrant as specified incorporation or in its Trust Agreement) organization) -------------- ONE JAMES RIVER PLAZA 701 EAST CARY STREET RICHMOND, VIRGINIA 23219 (804) 771-3000 (Address including zip code, and telephone number, including area code, of registrants' principal executive offices) PATRICIA A. WILKERSON, VICE PRESIDENT AND CORPORATE SECRETARY JAMES P. CARNEY, ASSISTANT TREASURER VIRGINIA ELECTRIC AND POWER COMPANY ONE JAMES RIVER PLAZA, 701 EAST CARY STREET RICHMOND, VIRGINIA 23219 (804) 771-3000 (Name, address, including zip code, and telephone number, including area code, of agent for service) -------------- With a Copy to: JAMES F. STUTTS JANE WHITT SELLERS VIRGINIA ELECTRIC AND POWER COMPANY McGUIRE, WOODS, BATTLE & BOOTHE LLP 701 EAST CARY STREET ONE JAMES CENTER RICHMOND, VIRGINIA 23219 RICHMOND, VIRGINIA 23219 -------------- Approximate date of commencement of proposed sale to the public: From time to time after effectiveness If the only securities being registered on this form are being offered pursuant to dividend or interest reinvestment plans, check the following box. [_] If any of the securities being registered on this form are to be offered on a delayed or continuous basis pursuant to Rule 415 under the Securities Act of 1933, other than securities offered only in connection with dividend or interest reinvestment plans, check the following box. [X] If this form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, please check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. [_] If this form is a post-effective amendment filed pursuant to Rule 462(b) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. [_] If delivery of the prospectus is expected to be made pursuant to Rule 434, please check the following box. [_] -------------- CALCULATION OF REGISTRATION FEE(1) - ------------------------------------------------------------------------------------ - ------------------------------------------------------------------------------------
Proposed Proposed Title of each Class of Amount Maximum Maximum Amount of Securities to be to be Offering Price Aggregate Registration Registered Registered Per Share(2) Offering Price Fee - ------------------------------------------------------------------------------------ Mortgage Bonds......... - ------------------------------------------------------------------------------------ Senior Debt Securities............ - ------------------------------------------------------------------------------------ Junior Subordinated Notes................. - ------------------------------------------------------------------------------------ Trust Preferred Securities and Related Guarantee(3).......... - ------------------------------------------------------------------------------------ Preferred Stock........ - ------------------------------------------------------------------------------------ Agreement Regarding Expenses and Liabilities........... - ------------------------------------------------------------------------------------ TOTAL................ $1,500,000,000 $1,500,000,000 $396,000(4)(5) - ------------------------------------------------------------------------------------ - ------------------------------------------------------------------------------------
(1) Estimated in accordance with Rule 457 solely for the purpose of calculating the registration fee. Such amount in U.S. dollars or the equivalent thereof in other currencies, as shall result in an aggregate offering price for all securities of $1,500,000,000. (2) Omitted pursuant to General Instruction II.D. of Form S-3. (3) No separate consideration will be received for the guarantee by Virginia Electric and Power Company. (4) The $121,212 appropriate registration fees were paid in connection with File No. 333-20561 and are being carried forward pursuant to Rule 429. (5) The $31,250 appropriate registration fees were paid in connection with File No. 33-50425 and are being carried forward pursuant to Rule 429. -------------- Pursuant to Rule 429 under the Securities Act of 1933, as amended, the Prospectus constituting a part of this Registration Statement also relates to $400,000,000 of the registrants' Junior Subordinated Notes registered for sale in a Registration Statement on Form S-3 (File No. 333-20561). This Registration Statement also constitutes Post-Effective Amendment No. 1 with respect to Registration Statement No. 333-20561 and such Post-Effective Amendment shall become effective concurrently with the effectiveness of this Registration Statement in accordance with Section 8(c) of the Securities Act of 1933. Pursuant to Rule 429 under the Securities Act of 1933, as amended, the Prospectus constituting a part of this Registration Statement also relates to $100,000,000 of the registrants' Preferred Stock registered for sale in a Registration Statement on Form S-3 (File No. 33-50425). This Registration Statement also constitutes Post-Effective Amendment No. 1 with respect to Registration Statement No. 33-50425 and such Post-Effective Amendment shall become effective concurrently with the effectiveness of this Registration Statement in accordance with Section 8(c) of the Securities Act of 1933. -------------- The registrants hereby amend this Registration Statement on such date or dates as may be necessary to delay its effective date until the registrants shall file a further amendment which specifically states that this Registration Statement shall thereafter become effective in accordance with Section 8(a) of the Securities Act of 1933 or until the Registration Statement shall become effective on such date as the SEC, acting pursuant to Section 8(a), may determine. - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- PROSPECTUS LOGO Virginia Electric and Power Company One James River Plaza 701 East Cary Street Richmond, Virginia 23219 (804) 771-3000 $1,500,000,000 Mortgage Bonds Senior Debt Securities Junior Subordinated Notes Trust Preferred Securities and Related Guarantee Preferred Stock Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of these securities or passed upon the adequacy or accuracy of this Prospectus. Any representation to the contrary is a criminal offense. This prospectus is dated , 2000. Table of Contents
Page ---- About This Prospectus............................................... 1 Where You Can Find More Information................................. 1 The Company......................................................... 1 The Trust........................................................... 2 Use of Proceeds..................................................... 2 Coverage Ratios..................................................... 2 Description of the Bonds............................................ 3 Description of Debt Securities...................................... 5 Additional Terms of Senior Debt Securities.......................... 12 Additional Terms of Junior Subordinated Notes....................... 13 Description of the Trust Preferred Securities....................... 15 Description of the Guarantee........................................ 23 Relationship Among the Trust Preferred Securities, the Guarantee and the Junior Subordinated Notes Held by the Trust.................... 26 Accounting Treatment................................................ 27 Description of Preferred Stock...................................... 27 Plan of Distribution................................................ 28 Legal Opinions...................................................... 28 Experts............................................................. 28
ABOUT THIS PROSPECTUS This prospectus is part of a registration statement that we filed with the Securities and Exchange Commission utilizing a shelf registration process. Under this shelf process, we may, from time to time, sell any combination of the securities described in this prospectus in one or more offerings up to a total dollar amount of $1,500,000,000. This prospectus provides you with a general description of the securities we may offer. Each time we sell securities, we will provide a prospectus supplement that will contain specific information about the terms of that offering. Material United States federal income tax considerations applicable to the offered securities will also be discussed in the applicable prospectus supplement. The prospectus supplement may also add, update or change information contained in this prospectus. You should read both this prospectus and any prospectus supplement together with additional information described under the heading WHERE YOU CAN FIND MORE INFORMATION. WHERE YOU CAN FIND MORE INFORMATION We file annual, quarterly and special reports and other information with the SEC. Our SEC filings are available to the public over the Internet at the SEC's web site at http://www.sec.gov. You may also read and copy any document we file at the SEC's public reference rooms in Washington, D.C., New York, New York and Chicago, Illinois. Please call the SEC at 1-800-SEC-0330 for further information on the public reference rooms. You may also read and copy these documents at the offices of the New York Stock Exchange, 20 Broad Street, New York, New York 10005. The SEC allows us to incorporate by reference the information we file with them, which means that we can disclose important information to you by referring you to those documents. The information incorporated by reference is an important part of this prospectus, and information that we file later with the SEC will automatically update and supersede this information. We incorporate by reference the documents listed below and any future filings made with the SEC under Sections 13(a), 13(c), 14, or 15(d) of the Securities Exchange Act of 1934 until we sell all of the securities. . Annual Report on Form 10-K for the year ended December 31, 1999; . Quarterly Report on Form 10-Q for the quarter ended March 31, 2000; You may request a copy of these filings at no cost, by writing or telephoning us at the following address: Corporate Secretary Virginia Electric and Power Company One James River Plaza 701 East Cary Street Richmond, Virginia 23219 (804) 771-3000 You should rely only on the information incorporated by reference or provided in this prospectus or any prospectus supplement. We have not authorized anyone else to provide you with different information. We are not making an offer of these securities in any state where the offer is not permitted. You should not assume that the information in this prospectus or any prospectus supplement is accurate as of any date other than the date on the front of those documents. THE COMPANY Virginia Electric and Power Company is a Virginia corporation with its principal office located at 701 East Cary Street, Richmond, Virginia 23219. The telephone number is (804) 771-3000. All of our common stock is held by Dominion Resources, Inc., a Virginia corporation. 1 The Company is a public utility engaged in the generation, transmission, distribution and sale of electric energy within a 30,000 square-mile area in Virginia and northeastern North Carolina. We transact business under the name of Virginia Power in Virginia and under the name of North Carolina Power in North Carolina. The Virginia service area comprises about 65% of Virginia's total land area but accounts for over 80% of its population. THE TRUST Virginia Power Capital Trust II is a statutory business trust newly formed under Delaware law by us, as sponsor for the Trust, and Chase Manhattan Bank Delaware, who will serve as trustee in the State of Delaware for the purpose of complying with the provisions of the Delaware Business Trust Act. The trust agreement for the Trust will be amended and restated substantially in the form filed as an exhibit to the registration statement, effective when securities of the Trust are initially issued. The amended trust agreement will be qualified as an indenture under the Trust Indenture Act of 1939. The Trust exists for the exclusive purposes of . issuing two classes of trust securities, Trust Preferred Securities and trust common securities, which together represent undivided beneficial interests in the assets of the Trust; . investing the gross proceeds of the trust securities in our Junior Subordinated Notes; . making distributions; and . engaging in only those other activities necessary, advisable or incidental to the purposes listed above. The Junior Subordinated Notes will be the sole asset of the Trust, and our payments under the Junior Subordinated Notes and the Agreement as to Expenses and Liabilities will be the sole revenue of the Trust. No separate financial statements of the Trust are included in this prospectus. We consider that these financial statements would not be material to holders of the Trust Preferred Securities because the Trust has no independent operations and the purposes of the Trust are as described above. We do not expect that the Trust will be filing annual, quarterly or special reports with the SEC. The principal place of business of the Trust will be c/o Virginia Electric and Power Company, One James River Plaza, 701 East Cary Street, Richmond, Virginia 23219. USE OF PROCEEDS The net proceeds from the sale of the offered securities will be used to meet a portion of the general capital requirements of the Company and for the refinancing of other outstanding debt. COVERAGE RATIOS The ratio of earnings to fixed charges and ratio of earnings to fixed charges and preferred stock dividends for each of the periods indicated is as follows:
Twelve Months ended Dec. 31, For the Twelve ------------------------ Months ended 1995 1996 1997 1998 1999 March 31, 2000 ---- ---- ---- ---- ---- -------------- Ratio of earnings to fixed charges.... 2.99 3.14 3.21 2.19 3.50 3.61 Ratio of earnings to fixed charges and preferred stock dividends............ 2.49 2.70 2.75 1.85 2.94 3.01
2 In the ratio of earnings to fixed charges, earnings are determined by adding taxes on income and fixed charges to income before extraordinary items. These earnings are then divided by total fixed charges. Fixed charges consist of interest charges (without reduction for Allowance for Funds Used During Construction) on long-term and short-term debt, and the portion of rentals as is representative of the interest factor. In the ratio of earnings to fixed charges and preferred stock dividends, earnings are determined by adding taxes on income, fixed charges, and preferred stock dividends (grossed-up by a factor of pre-tax net income divided by net income) to income before extraordinary items. These earnings are then divided by the sum of total fixed charges and preferred stock dividends (as grossed- up). DESCRIPTION OF THE BONDS We will issue our First and Refunding Mortgage Bonds (Bonds) in one or more series under an Indenture of Mortgage dated November 1, 1935, as supplemented and modified by eighty-five supplemental indentures and as to be supplemented by one or more additional supplemental indentures to be entered into in connection with each new series of Bonds. The Indenture of Mortgage and all such supplemental indentures are collectively referred to as the Mortgage. The Indenture of Mortgage, the eighty-five supplemental indentures and a form of supplemental indenture are Exhibits to the Registration Statement of which this Prospectus is a part. The Trustee under the Mortgage is The Chase Manhattan Bank (the Trustee). We have summarized selected provisions of the Mortgage below. Capitalized terms used in the summary have the meanings specified in the Mortgage. General Unless otherwise provided in the applicable prospectus supplement, we will issue the Bonds only in fully registered form, without coupons, in denominations of $1,000 and integral multiples thereof and these will be exchangeable for a like aggregate principal amount of Bonds of other authorized denominations of the same series. No charge will be made for any transfer or exchange of the Bonds, but we may require payment of a sum sufficient to cover any stamp tax or other governmental charge. You may transfer and exchange your Bonds at The Chase Manhattan Bank, 55 Water Street, New York, New York 10041. Interest, Maturity and Payment The Bonds will bear interest from their issue date at the rate shown in the applicable prospectus supplement payable semiannually on the interest payment dates shown in that prospectus supplement. The Bonds will mature on the date shown in the applicable prospectus supplement. Interest will be paid to the persons in whose names the Bonds are registered at the close of business on the 15th day (whether or not a business day) of the calendar month next preceding the interest payment date, except for defaulted interest and except for unmatured accrued interest on Bonds called for redemption on a date other than an interest payment date. Principal of, premium, if any, and interest on the Bonds are payable at the office or agency of the Trustee in New York City. Provisions of a Particular Series You should refer to the applicable prospectus supplement for the specific terms relating to that particular series of Bonds including: . its specific designation; . the aggregate principal amount; . the date or dates on which the series will mature; . the rate per annum at which the series will bear interest; 3 . any optional or mandatory redemption provisions allowing the Bonds to be redeemed at our option or of the holder of the Bonds including the redemption or repayment dates and the redemption or repayment prices; and . any other special terms. Security and Priority The Bonds will be our secured obligations, together with all other bonds presently or issued later under the Mortgage. The Bonds will be secured by a direct lien on all public utility property owned by us but subject to the operation of the release provisions (which, in effect, permit the disposition of all property in excess of the amount used under the Mortgage). Prior lien debt on after-acquired property may be extended or refunded under the same lien until property is certified under the Mortgage, but not after certification, except upon consent of the holders of 60% in the amount of the bonds issued and outstanding under the Mortgage. (See Sections 4.03 and 4.07 of the Mortgage.) All cash, securities, accounts receivable, agreements, leases, materials and supplies, automotive equipment, timber, coal and other minerals under the mortgaged land, and certain other assets are excluded from the lien. (See Preamble to the Indenture of Mortgage, Part VIII and Fourteenth Supplemental Indenture, Part VI.) In case of a merger, consolidation or sale of substantially all of our assets, the lien may be limited to our system at that time. (See Sections 8.02, 8.03 and 8.04 of the Mortgage.) The lien of the Mortgage must be duly recorded and filed, and is a first lien junior only to (i) statutory liens and equitable priorities for taxes, services, materials and supplies and (ii) pre-existing liens on after-acquired property. Other than the security afforded by the lien of the Mortgage and described under the caption "DESCRIPTION OF THE BONDS," there are no provisions of the Mortgage which provide holders of the Bonds protection in the event of a highly leveraged transaction involving our Company. Such a transaction would require regulatory approval, however, and we believe such approval would be unlikely in a transaction that would result in our having a highly leveraged capital structure. Issuance of Additional Bonds or Other Debt We may issue additional bonds under the Mortgage of any series from time to time, but not more in aggregate amount than the amount authorized by our shareholders (currently $5 billion), on the following bases: 1. Up to 60% of the net amount of additional property certified under Section 2.03 and subject to no senior lien except permitted liens and liens securing refundable debt, but only if net earnings (in 12 consecutive months within the 15 next previous months), after depreciation but before income taxes, are at least twice the annual interest charges on all bonds then outstanding or applied for and any indebtedness secured by senior liens. a. But no more than 20% of total net earnings may be from nonoperating income and the aggregate of maintenance and repairs and depreciation shall be not less than 15% of total operating revenues less the cost of electricity purchased for resale and resale paid by us for electric properties for such period. b. Refundable debt may not exceed 60% of the property securing it or 15% of the bonds outstanding or issuable and is deducted from the amount of bonds otherwise issuable. (See Sections 2.02, 2.03, 2.08, 2.09 and 4.16 of the Mortgage.) 2. Up to the amount of bonds or refundable debt retired (unless from certain funds). (See Sections 2.02, 2.04, 2.05, 2.08 and 2.09 of the Mortgage.) 3. Up to the amount of cash deposited for the purpose, but only if net earnings are as required in 1 above. The cash may be withdrawn in the amount of the bonds issuable as shown in 1 and 2 above, without regard to earnings. This is the only restriction on the disposition of proceeds of additional bonds. (See Sections 2.02, 2.06 and 2.07 of the Mortgage.) The Bonds will be issued on the bases set forth above. 4 The Mortgage does not limit the Company's ability to issue additional unsecured debt. Release and Substitution of Security Property may be released upon filing a Credit Certificate or upon depositing cash in the amount of the value of the property (which then may be withdrawn upon filing a Credit Certificate). The Credit Certificate supplies evidence, between formal certifications under Section 2.03 of the Mortgage, that credits previously established on the basis of property acquisition or bonds or refundable debt retirement have not been exhausted by showing that the retirements that have not yet been certified are less than the balance of the credits that would remain unused after the action then sought (including in such credits the amount of additional property not formally certified and the amount of release moneys, etc., then held by the Trustee). Instead of cash, purchase money bonds or bonds of the United States or any State or their respective political subdivisions may be deposited. Special provisions are made for property and cash subject to senior liens and for refundable debt held in pledge. (See Section 2.09(q), Article 5 and Article 6 of the Mortgage.) Modification With the consent of the holders of 75% in amount of all bonds issued and outstanding under the Mortgage (including at least 60% in amount of each affected series) . any default may be waived except for a default in the payment of principal or interest at their due dates; and . the Mortgage may be changed in any way except to extend the due dates of principal or interest or reduce the amount of principal, interest or premium, if any. (See Section 7.24 and Article 14 of the Mortgage.) Default and Action by the Trustee An event of default includes: . default in payment of principal of any series of bonds issued under the Mortgage; . continuous default for 90 days in payment of interest on any series of such bonds (except that the default need only continue for 30 days in the case of certain series); . default for 90 days after notice in the performance of any other covenant in the Mortgage and the occurrence of certain bankruptcy-related events. (See Section 7.01. of the Mortgage) During an event of default, the Trustee must use the same degree of care and skill as a prudent person in the conduct of their own affairs. Subject to that standard, a majority in amount of bonds issued under the Mortgage is necessary to require the Trustee to take action, and the Trustee is entitled to be indemnified to its satisfaction. (See Section 7.20 of Indenture of Mortgage and Third Supplemental Indenture Sections 7.02 and 7.03.) We are required to report annually to the Trustee that we are not in default under the Mortgage. (See Third Supplemental Indenture Section 6.03.) DESCRIPTION OF DEBT SECURITIES The term Debt Securities includes the Senior Debt Securities and the Junior Subordinated Notes. We will issue the Senior Debt Securities in one or more series under our Senior Indenture dated as of June 1, 1998, between us and The Chase Manhattan Bank as Trustee. We will issue the Junior Subordinated Notes in one or more series under our Subordinated Note Indenture dated as of August 1, 1995 between us and The Chase Manhattan Bank (formerly Chemical Bank) as Trustee, as supplemented from time to time. We have summarized selected provisions of the Indentures below. The Senior Indenture and the Subordinated Note 5 Indenture are exhibits to the registration statement and you should read the Indentures for provisions that may be important to you. In the summary below, we have included references to section numbers of the Indentures so that you can easily locate these provisions. Capitalized terms used in the summary have the meanings specified in the Indentures. General The Senior Debt Securities will be our direct, unsecured obligations and will rank equally with all of our other senior and unsubordinated debt. The Junior Subordinated Notes will be our unsecured obligations and are junior in right of payment to our Senior Indebtedness, as described under the caption ADDITIONAL TERMS OF JUNIOR SUBORDINATED NOTES--Subordination. Our ability to meet our obligations under the Debt Securities is dependent on our earnings and cash flows. As of April 1, 2000, we have 6.5 million issued and outstanding shares of Preferred Stock with an aggregate liquidation value of $656.1 million. In addition to trade debt, we have ongoing corporate debt programs used to finance our business activities. As of April 1, 2000, we had approximately $4.1 billion of outstanding debt. Neither of the Indentures limits the amount of Debt Securities that we may issue under it. We may issue Debt Securities from time to time under the Indentures in one or more series by entering into supplemental indentures or by our Board of Directors or a duly authorized committee authorizing the issuance. A form of supplemental indenture to each of the Indentures is an exhibit to the registration statement. The Indentures do not protect the holders of Debt Securities if we engage in a highly leveraged transaction. Provisions of a Particular Series The Debt Securities of a series need not be issued at the same time, bear interest at the same rate or mature on the same date. The prospectus supplement for a particular series of Debt Securities will specify the terms of that series, including, if applicable, some or all of the following: . the title and type of the Debt Securities; . the total principal amount of the Debt Securities; . the portion of the principal payable upon acceleration of maturity, if other than the entire principal; . the date or dates on which principal is payable or the method for determining the date or dates, and any right that we have to change the date on which principal is payable; . the interest rate or rates, if any, or the method for determining the rate or rates, and the date or dates from which interest will accrue; . any interest payment dates and the regular record date for the interest payable on each interest payment date, if any; . any payments due if the maturity of the Debt Securities is accelerated; . any optional redemption terms, or with respect to the Senior Debt Securities, any repayment terms; . the obligations, if any, of the Company to redeem or purchase any securities of the series pursuant to any sinking fund, purchase fund or analogous provisions or at the option of the Holder thereof and the period or periods within which, the price or prices at which the terms and conditions upon which any Securities of the series shall be redeemed or purchased, in whole or in part, pursuant to such obligation; . any provisions that would obligate us to repurchase or otherwise redeem the Debt Securities, or, with respect to the Senior Debt Securities, any sinking fund provisions; 6 . the currency in which payments will be made if other than U.S. dollars, and the manner of determining the equivalent of those amounts in U.S. dollars; . if payments may be made, at our election or at the holder's election, in a currency other than that in which the Debt Securities are stated to be payable, then the currency in which those payments may be made, the terms and conditions of the election and the manner of determining those amounts; . any index or formula used for determining principal, interest, or premium, if any; . the percentage of the principal amount at which the Debt Securities will be issued, if other than 100% of the principal amount; . whether the Debt Securities will be issued in fully registered certificated form or book-entry form, represented by certificates deposited with, or on behalf of, a securities depositary and registered in the name of the depositary's nominee (Book-Entry Debt Securities); . denominations, if other than $1,000 each or multiples of $1,000; . any changes to events of defaults or covenants; and . any other terms of the Debt Securities. (Sections 201 & 301 of the Senior Indenture & Sections 201 & 301 of the Subordinated Note Indenture) The prospectus supplement will also indicate any special tax implications of the Debt Securities and any provisions granting special rights to holders when a specified event occurs. Conversion or Redemption No Debt Security will be subject to conversion, amortization, or redemption, unless otherwise provided in the applicable prospectus supplement. Any provisions relating to the conversion or redemption of Debt Securities will be set forth in the applicable prospectus supplement, including whether conversion is mandatory or at our option. If no redemption date or redemption price is indicated with respect to a Debt Security, we may not redeem the Debt Security prior to Stated Maturity. Debt Securities subject to redemption by us will be subject to the following terms: . redeemable on and after the applicable redemption dates; . redemption dates and redemption prices fixed at the time of sale and set forth on the Debt Security; and . redeemable in whole or in part (provided that any remaining principal amount of the Debt Security will be equal to an authorized denomination) at our option at the applicable redemption price, together with interest, payable to the date of redemption, on notice given not less than 30 nor more than 60 days prior to the date of redemption. (Section 1104 of the Senior Indenture & Section 1104 of the Subordinated Note Indenture.) We will not be required to: . issue, register the transfer of, or exchange any Debt Securities of a series during the period beginning 15 days before the date the notice is mailed identifying the Debt Securities of that series that have been selected for redemption; or . register the transfer of, or exchange any Debt Security of that series selected for redemption except the unredeemed portion of a Debt Security being partially redeemed. (Section 305 of the Senior Indenture & Section 303 of the Subordinated Note Indenture.) Payment and Transfer; Paying Agent The paying agent will pay the principal of any Debt Securities only if those Debt Securities are surrendered to it. Unless we state otherwise in the applicable prospectus supplement, the paying agent will pay 7 principal, interest and premium, if any, on Debt Securities, subject to such surrender, where applicable, at its office or, at our option: . by wire transfer to an account at a banking institution in the United States that is designated in writing to the Trustee prior to the deadline set forth in the applicable prospectus supplement by the person entitled to that payment (which in the case of Book-Entry Debt Securities is the securities depositary or its nominee); or . by check mailed to the address of the person entitled to that interest as that address appears in the security register for those Debt Securities. (Sections 307 & 1001 of the Senior Indenture & Sections 305 and 1001 of the Subordinated Note Indenture.) Neither we nor the Trustee will have any responsibility or liability for any aspect of the records relating to or payments made on account of beneficial ownership interests in a Book-Entry Debt Security, or for maintaining, supervising or reviewing any records relating to the beneficial ownership interests. We expect that the securities depositary, upon receipt of any payment of principal, interest or premium, if any, in a Book-Entry Debt Security, will credit immediately the accounts of the related participants with payment in amounts proportionate to their respective holdings in principal amount of beneficial interest in the Book-Entry Debt Security as shown on the records of the securities depositary. We also expect that payments by participants to owners of beneficial interests in a Book-Entry Debt Security will be governed by standing customer instructions and customary practices, as is now the case with securities held for the accounts of customers in bearer form or registered in "street name" and will be the responsibility of the participants. Unless we state otherwise in the applicable prospectus supplement, the Trustee will act as paying agent for the Debt Securities, and the principal corporate trust office of the Trustee will be the office through which the paying agent acts. We may, however, change or add paying agents or approve a change in the office through which a paying agent acts. (Section 1002 of the Senior Indenture & Section 1002 of the Subordinated Note Indenture.) Any money that we have paid to a paying agent for principal or interest on any Debt Securities which remains unclaimed at the end of two years after that principal or interest has become due will be repaid to us at our request. After repayment to the Company, holders should look only to us for those payments. (Section 1003 of the Senior Indenture & Section 1003 of the Subordinated Note Indenture.) Fully registered securities may be transferred or exchanged at the corporate trust office of the Trustee or at any other office or agency we maintain for those purposes, without the payment of any service charge except for any tax or governmental charge. (Section 1002 of the Senior Indenture & Section 1002 of the Subordinated Note Indenture.) Global Securities We may issue some or all of the Debt Securities as Book-Entry Debt Securities. Book-Entry Debt Securities will be represented by one or more fully registered global certificates. Book-Entry Debt Securities of like tenor and terms up to $400,000,000 aggregate principal amount may be represented by a single global certificate. Each global certificate will be deposited and registered with the securities depositary or its nominee or a custodian for the securities depositary. Unless it is exchanged in whole or in part for Debt Securities in definitive form, a global certificate may generally be transferred only as a whole unless it is being transferred to certain nominees of the depositary. (Section 305 of the Senior Indenture & Section 203 of the Subordinated Note Indenture.) Unless otherwise stated in any prospectus supplement, The Depository Trust Company will act as the securities depositary. Beneficial interests in global certificates will be shown on, and transfers of global certificates will be effected only through, records maintained by the securities depositary and its participants. If 8 there are any additional or differing terms of the depositary arrangement with respect to the Book-Entry Debt Securities, we will describe them in the applicable prospectus supplement. Holders of beneficial interests in Book-Entry Debt Securities represented by a global certificate are referred to as beneficial owners. Beneficial owners will be limited to institutions having accounts with the securities depositary or its nominee, which are called participants in this discussion, and to persons that hold beneficial interests through participants. When a global certificate representing Book-Entry Debt Securities is issued, the securities depositary will credit on its book-entry, registration and transfer system the principal amounts of Book-Entry Debt Securities the global certificate represents to the accounts of its participants. Ownership of beneficial interests in a global certificate will be shown only on, and the transfer of those ownership interests will be effected only through, records maintained by: . the securities depositary, with respect to participants' interests; and . any participant, with respect to interests the participant holds on behalf of other persons. As long as the securities depositary or its nominee is the registered holder of a global certificate representing Book-Entry Debt Securities, that person will be considered the sole owner and holder of the global certificate and the Book-Entry Debt Securities it represents for all purposes. Except in limited circumstances, beneficial owners: . may not have the global certificate or any Book-Entry Debt Securities it represents registered in their names; . may not receive or be entitled to receive physical delivery of certificated Book-Entry Debt Securities in exchange for the global certificate; and . will not be considered the owners or holders of the global certificate or any Book-Entry Debt Securities it represents for any purposes under the Debt Securities or the Indentures. (Section 202 of the Subordinated Note Indenture.) We will make all payments of principal, interest and premium, if any, on a Book-Entry Debt Security to the securities depositary or its nominee as the holder of the global certificate. The laws of some jurisdictions require that certain purchasers of securities take physical delivery of securities in definitive form. These laws may impair the ability to transfer beneficial interests in a global certificate. Payments participants make to beneficial owners holding interests through those participants will be the responsibility of those participants. The securities depositary may from time to time adopt various policies and procedures governing payments, transfers, exchanges and other matters relating to beneficial interests in a global certificate. None of the following will have any responsibility or liability for any aspect of the securities depositary's or any participant's records relating to beneficial interests in a global certificate representing Book-Entry Debt Securities, for payments made on account of those beneficial interests or for maintaining, supervising or reviewing any records relating to those beneficial interests: . the Company; . the Trustee; . the Trust (only with respect to the Junior Subordinated Notes if the Junior Subordinated Notes are issued to a Trust); or . any agent of any of the above. Covenants Under the Indentures we will: . pay the principal, interest and premium, if any, on the Debt Securities when due; 9 . maintain a place of payment; . preserve and keep in full force and effect the corporate existence except as provided in the Indentures . deliver an officer's certificate to the Trustee at the end of each fiscal year confirming our compliance with our obligations under each of the Indentures; and . deposit sufficient funds with any paying agent on or before the due date for any principal, interest or premium, if any. . file a written notice with Trustee specifying the amount of original issue discount (including daily rate and accrual periods) accrued on the outstanding securities. (Sections 1001, 1002, 1003, 1004, 1005, 1006, 1007 of the Senior Indenture & Sections 1001, 1002, 1003 and 1006 of the Subordinated Note Indenture.) Consolidation, Merger or Sale The Indentures provide that we may consolidate or merge with or into, or sell all or substantially all of our properties and assets to, another corporation or other entity, provided that any successor assumes our obligations under the Indentures and the Debt Securities issued under the Indentures. We must also deliver an opinion of counsel to the Trustee affirming our compliance with all conditions in the applicable Indenture relating to the transaction. When the conditions are satisfied, the successor will succeed to and be substituted for us under the Senior Indenture, and we will be relieved of our obligations under the Senior Indenture and the Debt Securities issued under them. (Sections 801 & 802 of the Senior Indenture & Sections 801 & 802 of the Subordinated Note Indenture.) Events of Default Event of Default when used in each of the Indentures, will mean any of the following: . failure to pay the principal or any premium on any Debt Security when due; . with respect to the Senior Debt Securities, failure to deposit any sinking fund payment when due that continues for 60 days; . failure to pay any interest on any Debt Securities of that series, when due, that continues for 60 days; provided that, if applicable, for this purpose, the date on which interest is due is the date on which we are required to make payment following any deferral of interest payments by it under the terms of Junior Subordinated Notes that permit such deferrals; . failure to perform any other covenant in the Indentures (other than a covenant expressly included solely for the benefit of other series) that continues for 90 days after the Trustee or the holders of at least 33% of the outstanding Debt Securities (25% in the case of the Junior Subordinated Notes) of that series give us written notice of the default; . certain events in bankruptcy, insolvency or reorganization of the Company; or . any other Event of Default included in the Indentures or any supplemental indenture. (Section 501 of the Senior Indenture & Section 501 of the Subordinated Note Indenture.) In the case of a general covenant default described above, the Trustee may extend the grace period. In addition, if holders of a particular series have given a notice of default, then holders of at least the same percentage of Debt Securities of that series, together with the Trustee, may also extend the grace period. The grace period will be automatically extended if we have initiated and are diligently pursuing corrective action. An Event of Default for a particular series of Debt Securities does not necessarily constitute an Event of Default for any other series of Debt Securities issued under the Indentures. Additional events of default may be established for a particular series and, if established, will be described in the applicable prospectus supplement. 10 If an Event of Default for any series of Debt Securities occurs and continues, the Trustee or the holders of at least 33% (25%, in the case of the Junior Subordinated Notes) in aggregate principal amount of the Debt Securities of the series may declare the entire principal of all the Debt Securities of that series to be due and payable immediately. If this happens, subject to certain conditions, the holders of a majority of the aggregate principal amount of the Debt Securities of that series can void the trust agreement. (Section 502 of the Senior Indenture & Section 502 of the Subordinated Note Indenture.) The Trustee may withhold notice to the holders of Debt Securities of any default (except in the payment of principal or interest) if it considers the withholding of notice to be in the best interests of the holders. Other than its duties in case of a default, a Trustee is not obligated to exercise any of its rights or powers under the Indentures at the request, order or direction of any holders, unless the holders offer the Trustee reasonable indemnity. If they provide this reasonable indemnification, the holders of a majority in principal amount of any series of Debt Securities may direct the time, method and place of conducting any proceeding or any remedy available to the Trustee, or exercising any power conferred upon the Trustee, for any series of Debt Securities. However, the Trustee shall give the holders of Debt Securities notice of any default to the extent provided by the Trust Indenture Act. (Sections 512, 601 & 602 of the Senior Indenture & Sections 512, 601 and 602 of the Subordinated Note Indenture.) The holder of any Debt Security will have an absolute and unconditional right to receive payment of the principal, any premium and, within certain limitations, any interest on that Debt Security on its maturity date or redemption date and to enforce those payments. (Section 508 of the Senior Indenture & Section 508 of the Subordinated Note Indenture.) Satisfaction; Discharge We may discharge all our obligations (except those described below) to holders of the Debt Securities issued under the Indentures, which Debt Securities have not already been delivered to the Trustee for cancellation and which either have become due and payable or are by their terms due and payable within one year, or are to be called for redemption within one year, by depositing with the Trustee an amount certified to be sufficient to pay when due the principal, interest and premium, if any, on all outstanding Debt Securities. However, certain of our obligations under the Indentures will survive, including with respect to the following: . rights of holders to cause us to register the transfer, conversion, substitution or exchange of Debt Securities of the applicable series; . rights of holders to receive payments of principal of, and any interest on, the Debt Securities of the applicable series, and other rights, duties and obligations of the holders of Debt Securities with respect to any amounts deposited with the Trustee; and . the rights, obligations and immunities of the Trustee under the Indentures. (Section 401 of Senior Indenture & Section 401 of Subordinated Note Indenture.) Modification of Indentures; Waiver Under the Indentures our rights and obligations and the rights of the holders may be modified with the consent of the holders of a majority in aggregate principal amount of the outstanding Debt Securities of each series affected by the modification. No modification of the principal or interest payment terms, and no modification reducing the percentage required for modifications, is effective against any holder without its consent. (Section 902 of the Senior Indenture & Section 902 of the Subordinated Note Indenture.) In addition, we may supplement the Indentures to create new series of Debt Securities and for certain other purposes, without the consent of any holders of Debt Securities. (Section 901 of the Senior Indenture & Section 901 of the Subordinated Note Indenture.) 11 The holders of a majority of the outstanding Debt Securities of all series under the applicable Indenture with respect to which a default has occurred and is continuing may waive a default for all those series, except a default in the payment of principal or interest, or any premium, on any Debt Securities or a default with respect to a covenant or provision which cannot be amended or modified without the consent of the holder of each outstanding Debt Security of the series affected. (Section 513 of the Senior Indenture & Section 513 of the Subordinated Note Indenture.) In addition, under certain circumstances, the holders of a majority of the outstanding Junior Subordinated Notes of any series may waive in advance, for that series, our compliance with certain restrictive provisions of the Subordinated Note Indenture under which those Junior Subordinated Notes were issued. (Section 1008 of the Subordinated Note Indenture.) Concerning the Trustee The Chase Manhattan Bank is the Subordinated Note Indenture Trustee and the Trustee under the Senior Indenture. We and certain of our affiliates maintain deposit accounts and banking relationships with The Chase Manhattan Bank. The Chase Manhattan Bank also serves as trustee under other indentures pursuant to which securities of ours and of certain of our affiliates are outstanding. It has purchased, and is likely to purchase in the future, our securities and securities of our affiliates. The Trustee will perform only those duties that are specifically set forth in the Indentures unless an event of default under an Indenture occurs and is continuing. The Trustee is under no obligation to exercise any of its powers under the Indentures at the request of any holder of Debt Securities unless that holder offers reasonable indemnity to the Trustee against the costs, expenses and liabilities which it might incur as a result. (Section 601 of the Senior Indenture & Section 601 of the Subordinated Note Indenture.) The Trustee administers its corporate trust business at 450 West 33rd Street, New York, New York 10001 (Attention: Capital Markets Fiduciary Services). ADDITIONAL TERMS OF SENIOR DEBT SECURITIES Repayment at the Option of the Holder; Repurchases by the Company Upon execution of the Fourth Supplemental Indenture to the Senior Indenture dated June 1, 1998, the Company may at its discretion issue Senior Debt Securities with repayment provisions at the option of the holder. We must repay the Senior Debt Securities at the option of the Holders prior to the Stated Maturity Date only if specified in the applicable prospectus supplement. Unless otherwise provided in the prospectus supplement, the Senior Debt Securities subject to repayment at the option of the Holder will be subject to repayment: . on the specified Repayment Dates; and . at a repayment price equal to 100% of the unpaid principal amount to be repaid, together with unpaid interest accrued to the Repayment Date. For any Senior Debt Security to be repaid, the Trustee must receive, at its office maintained for that purpose in the Borough of Manhattan, New York City not more than 60 nor less than 30 calendar days prior to the date of repayment: . in the case of a certificated Senior Debt Security, the certificated Senior Debt Security and the form in the Senior Debt Security entitled Option of Holder to Elect Purchase duly completed; or . in the case of a book-entry Senior Debt Security, instructions to that effect from the beneficial owner to the securities depositary and forwarded by the securities depositary. Exercise of the repayment option by the Holder will be irrevocable. 12 Only the securities depositary may exercise the repayment option in respect of beneficial interests in the book-entry Senior Debt Securities. Accordingly, beneficial owners that desire repayment in respect of all or any portion of their beneficial interests must instruct the participants through which they own their interests to direct the securities depositary to exercise the repayment option on their behalf. All instructions given to participants from beneficial owners relating to the option to elect repayment will be irrevocable. In addition, at the time the instructions are given, each beneficial owner will cause the participant through which it owns its interest to transfer its interest in the book-entry Senior Debt Securities or the global certificate representing the related book-entry Senior Debt Securities, on the securities depositary's records, to the Trustee. See DESCRIPTION OF THE DEBT SECURITIES--Global Securities. Defeasance We will be discharged from our obligations on the Senior Debt Securities of any series at any time if we deposit with the Trustee sufficient cash or government securities to pay the principal, interest, any premium and any other sums due to the stated maturity date or a redemption date of the Senior Debt Securities of the series. If this happens, the holders of the Senior Debt Securities of the series will not be entitled to the benefits of the Senior Indenture except for registration of transfer and exchange of Senior Debt Securities and replacement of lost, stolen or mutilated Senior Debt Securities. (Sections 1302 and 1304 of the Senior Indenture.) Under federal income tax law as of the date of this prospectus, a discharge may be treated as an exchange of the related Senior Debt Securities. Each holder might be required to recognize gain or loss equal to the difference between the holder's cost or other tax basis for the Senior Debt Securities and the value of the holder's interest in the Trust. Holders might be required to include as income a different amount than would be includable without the discharge. We urge prospective investors to consult their own tax advisers as to the consequences of a discharge, including the applicability and effect of tax laws other than the federal income tax law. ADDITIONAL TERMS OF JUNIOR SUBORDINATED NOTES Additional Covenants Applicable to Junior Subordinated Notes Under the Subordinated Note Indenture, we will: . maintain 100% ownership of any trust to which the Junior Subordinated Notes have been issued, if any, while the Junior Subordinated Notes remain outstanding; and . pay to any trust to which the Junior Subordinated Notes have been issued, if any, any taxes, duties, assessments or governmental charges of whatever nature (other than withholding taxes) imposed by the United States or any other taxing authority on the trust, so that the net amounts received and retained by the trust (after paying any taxes, duties, assessments or other governmental charges) will be not less than the trust would have received had no such taxes, duties, assessments or other governmental charges been imposed. (Sections 303 and 305 of the Subordinated Note Indenture.) Option to Extend Interest Payment Period We can defer interest payments by extending the interest payment period for the number of consecutive extension periods specified in the applicable prospectus supplement (each, an Extension Period). Other details regarding the Extension Period will also be specified in the applicable prospectus supplement. No Extension Period may extend beyond the maturity of the Junior Subordinated Notes. At the end of the Extension Period(s), we will pay all interest then accrued and unpaid, together with interest compounded quarterly at the rate for the Junior Subordinated Notes, to the extent permitted by applicable law. (Section 301 of the Subordinated Note Indenture.) 13 During any Extension Period, we will not make distributions related to our capital stock, including dividends, redemptions, repurchases, liquidation payments, or guarantee payments. Also we will not make any payments, redeem or repurchase any Debt Securities of equal or junior rank to the Junior Subordinated Notes or make any guarantee payments on any such Debt Securities. We may, however, make the following types of distributions: . dividends paid in common stock; . dividends in connection with the implementation of a shareholder rights plan; . payments to a trust holding securities of the same series under a guarantee; or . repurchases, redemptions or other acquisitions of shares of our capital stock in connection with any employment contract, benefit plan or other similar arrangement with or for the benefit of employees, officers, directors or consultants. Subordination Each series of Junior Subordinated Notes will be subordinate and junior in right of payment, to the extent set forth in the Subordinated Note Indenture, to all Senior Indebtedness as defined below. If: . we make a payment or distribution of any of our assets to creditors upon our dissolution, winding-up, liquidation or reorganization, whether in bankruptcy, insolvency or otherwise; . a default beyond any grace period has occurred and is continuing with respect to the payment of principal, interest or any other monetary amounts due and payable on any Senior Indebtedness; or . the maturity of any Senior Indebtedness has been accelerated because of a default on that Senior Indebtedness, then the holders of Senior Indebtedness generally will have the right to receive payment, in the case of the first instance, of all amounts due or to become due upon that Senior Indebtedness, and, in the case of the second and third instances, of all amounts due on that Senior Indebtedness, or we will make provision for those payments, before the holders of any Junior Subordinated Notes have the right to receive any payments of principal or interest on their Junior Subordinated Notes. (Sections 1301 and 1303 of the Subordinated Note Indenture.) Senior Indebtedness means, with respect to any series of Junior Subordinated Notes, the principal, premium, interest and any other payment in respect of any of the following: . all of our indebtedness for borrowed or purchased money that is evidenced by notes, debentures, bonds or other written instruments; . our obligations for reimbursement under letters of credit, banker's acceptances, security purchase facilities or similar facilities issued for our account; . any of our other indebtedness or obligations with respect to commodity contracts, interest rate commodity and currency swap agreements and other similar agreements or arrangements; and . all indebtedness of others of the kinds described in the preceding categories which we have assumed or guaranteed. Senior Indebtedness will not include our obligations to trade creditors or indebtedness. (Section 101 of the Subordinated Note Indenture.) Senior Indebtedness will be entitled to the benefits of the subordination provisions in the Subordinated Note Indenture irrespective of the amendment, modification or waiver of any term of the Senior Indebtedness. We may not amend the Subordinated Note Indenture to change the subordination of any outstanding Junior 14 Subordinated Notes without the consent of each holder of Senior Indebtedness that the amendment would adversely affect. (Section 1308 of the Subordinated Note Indenture.) The Subordinated Note Indenture does not limit the amount of Senior Indebtedness that we may issue. DESCRIPTION OF THE TRUST PREFERRED SECURITIES The following is a summary of the principal terms of the Trust Preferred Securities. The form of amended trust agreement is filed as an exhibit to the registration statement of which this prospectus forms a part, or is incorporated by reference. The terms of the Trust Preferred Securities will include those stated in the amended trust agreement and those made part of the amended trust agreement by the Trust Indenture Act. General The Trust will exist until terminated as provided in its amended trust agreement. Except under certain circumstances, we will be entitled to appoint, remove, or replace trustees, who will conduct the business and affairs of the Trust. The trustees of the Trust will consist of: . two employees, officers or affiliates of the Company as Administrative Trustees; . a financial institution unaffiliated with us that will act as property trustee and as indenture trustee for purposes of the Trust Indenture Act, under the terms set forth in a prospectus supplement (the Property Trustee); and . one trustee with its principal place of business or who resides in the State of Delaware and who will act under the terms set forth in a prospectus supplement. (Sections 6.1 through 6.5 of the Amended Trust Agreement.) The amended trust agreement will authorize the Administrative Trustees to issue, on behalf of the Trust, two classes of trust securities, Trust Preferred Securities and trust common securities, each of which will have the terms described in this prospectus and in the applicable prospectus supplement. We will own all of the trust common securities. The trust common securities will rank equally in right of payment, and payments will be made on the trust common securities, proportionately with the Trust Preferred Securities. However, if an event of default occurs and is continuing under the amended trust agreement, the rights of the holders of the trust common securities to payment for distributions and payments upon liquidation, redemption and otherwise, will be subordinated to the rights of the holders of the Trust Preferred Securities. We will acquire, directly or indirectly, trust common securities in a total liquidation amount of approximately 3% of the total capital of the Trust. (Sections 3.6, 5.1, 5.2 and 7.1 of the Amended Trust Agreement.) The proceeds from the sale of the Trust Preferred Securities will be used by the Trust to purchase our Junior Subordinated Notes. These Junior Subordinated Notes will be held in trust by the Property Trustee for the benefit of the holders of the trust securities. We will guarantee the payments of distributions and payments on redemption or liquidation with respect to the Trust Preferred Securities, but only to the extent the Trust has funds available to make those payments and has not made the payments. See DESCRIPTION OF THE GUARANTEE. The assets of the Trust available for distribution to the holders of Trust Preferred Securities will be limited to payments from us under the Junior Subordinated Notes held by the Trust. If we fail to make a payment on the Junior Subordinated Notes, the Trust will not have sufficient funds to make related payments, including distributions, on its Trust Preferred Securities. The Guarantee, only when taken together with our obligations under the Junior Subordinated Notes, the Subordinated Note Indenture and the amended trust agreement, will have the effect of providing a full and unconditional guarantee of amounts due on the Trust Preferred Securities issued by the Trust. 15 The Trust Preferred Securities will have the terms, including distributions, redemption, voting, liquidation rights and other preferred, deferred or other special rights or restrictions that will be described in the amended trust agreement or made part of the amended trust agreement by the Trust Indenture Act or the Delaware Business Trust Act. The terms of the Trust Preferred Securities will mirror the terms of the Junior Subordinated Notes held by the Trust. In other words, the distribution rate and the distribution payment dates and other payment dates for the Trust Preferred Securities will correspond to the interest rate and interest payment dates and other payment dates on the Junior Subordinated Notes. Holders of Trust Preferred Securities have no preemptive or similar rights. (Section 7.1 of the Amended Trust Agreement.) Provisions of a Particular Series The Trust may issue only one series of Trust Preferred Securities. The applicable prospectus supplement will set forth the principal terms of the Trust Preferred Securities that will be offered, including: . the name of the Trust Preferred Securities; . the liquidation amount and number of Trust Preferred Securities issued; . the annual distribution rate(s) or method of determining such rate(s), the payment date(s) and the record dates used to determine the holders who are to receive distributions; . the date from which distributions will be cumulative; . the optional redemption provisions, if any, including the prices, time periods and other terms and conditions on which the Trust Preferred Securities will be purchased or redeemed, in whole or in part; . the terms and conditions, if any, upon which the Junior Subordinated Notes and the related Guarantee may be distributed to holders of those Trust Preferred Securities; . any securities exchange on which the Trust Preferred Securities will be listed; . whether the Trust Preferred Securities are to be issued in book-entry form and represented by one or more global certificates, and if so, the depository for those global certificates and the specific terms of the depositary arrangements; and . any other relevant rights, preferences, privileges, limitations or restrictions of the Trust Preferred Securities. (Article 7 of the Amended Trust Agreement.) The interest rate and interest and other payment dates of each series of Junior Subordinated Notes issued to the Trust will correspond to the rate at which distributions will be paid and the distribution and other payment dates of the Trust Preferred Securities of the Trust. Extensions We have the right under the Subordinated Note Indenture to defer payments of interest on the Junior Subordinated Notes which may be held by the Trust by extending the interest payment period from time to time on the particular series of Junior Subordinated Notes. The Administrative Trustees will give the holders of the Trust Preferred Securities notice of any Extension Period applicable to the Trust Securities upon their receipt of notice from us. If distributions are deferred, the deferred distributions and accrued interest will be paid to holders of record of the Trust Preferred Securities as they appear on the books and records of the Trust on the record date next following the termination of such deferral period. See ADDITIONAL TERMS OF JUNIOR SUBORDINATED NOTES--Option to Extend Interest Payment Period. Distributions on the Trust Preferred Securities will be made on the dates payable to the extent that the Trust has funds available for the payment of distributions in the property account. The Trust's funds available for distribution to the holders of the trust securities will be limited to payments received from us on the Junior 16 Subordinated Notes. We have guaranteed the payment of distributions out of monies held by the Trust to the extent set forth under DESCRIPTION OF THE GUARANTEE. Distributions on the Trust Preferred Securities will be payable to the holders named on the securities books and records of the Trust at the close of business on the relevant record dates, which, as long as the Trust Preferred Securities remain in book-entry only form, will be one business day prior to the relevant payment dates. Distributions will be paid through the Property Trustee who will hold amounts received in respect of the Junior Subordinated Notes in the Property Account for the benefit of the holders of the trust securities. In the event that the Trust Preferred Securities do not continue to remain in book-entry only form, the relevant record dates will conform to the rules of any securities exchange on which the Trust Preferred Securities are listed and, if none, the Administrative Trustees will have the right to select relevant record dates, which will be more than 14 days but less than 60 days prior to the relevant payment dates. In the event that any date on which distributions are to be made on the Trust Preferred Securities is not a business day, then payment of the distributions payable on that date will be made on the next succeeding day which is a business day and without any interest or other payment in respect of that delay, except that, if that business day is in the next succeeding calendar year, the payment will be made on the immediately preceding business day, in each case with the same force and effect as if made on the record date. (Section 7.2 of the Amended Trust Agreement.) Mandatory Redemption of Trust Preferred Securities The Trust Preferred Securities have no stated maturity date, but will be redeemed upon the maturity of the Junior Subordinated Notes held by the Trust or to the extent the Junior Subordinated Notes held by the Trust are redeemed prior to maturity. The Junior Subordinated Notes will mature on the date specified in the applicable prospectus supplement and may be redeemed at any time, in whole but not in part, in certain circumstances upon the occurrence of a Tax Event or an Investment Company Event as described below under Special Event Redemption. Upon the maturity of the Junior Subordinated Notes held by the Trust, the proceeds of their repayment will simultaneously be applied to redeem all the outstanding trust securities at the Redemption Price. Upon the redemption of the Junior Subordinated Notes, held by the Trust either at our option or as a result of a Tax Event or an Investment Company Event, the proceeds from the redemption will simultaneously be applied to redeem trust securities having a total liquidation amount equal to the total principal amount of the Junior Subordinated Notes held by the Trust so redeemed at the redemption price; provided, that holders of trust securities will be given not less than 30 nor more than 60 days' notice of the redemption. In the event that fewer than all of the outstanding trust securities are to be redeemed, the trust securities will be redeemed proportionately. (Section 7.3 of the Amended Trust Agreement.) Special Event Redemption Both a Tax Event and an Investment Company Act Event constitute Special Events for purposes of the redemption provisions described in the preceding paragraph. A Tax Event means that the Administrative Trustees have received an opinion of independent tax counsel experienced in those matters to the effect that, as a result of: any amendment to, change or announced proposed change in, the laws or regulations of the United States or any of its political subdivisions or taxing authorities, or any official administrative pronouncement, action or judicial decision interpreting or applying those laws or regulations, which amendment or change becomes effective or proposed change, pronouncement, action or decision is announced on or after the date the Trust Preferred Securities are issued and sold, there is more than an insubstantial risk that: . the Trust is or within 90 days would be subject to U.S. federal income tax with respect to income accrued or received on the Junior Subordinated Notes held by it, 17 . interest payable to the Trust on the Junior Subordinated Notes held by it is not or within 90 days would not be deductible, in whole or in part, by us for U.S. federal income tax purposes, or . the Trust is or within 90 days would be subject to a material amount of other taxes, duties or other governmental charges. Investment Company Event means that the Administrative Trustees have received an opinion of a nationally recognized independent counsel to the effect that, as a result of an amendment to or change in the Investment Company Act or regulations thereunder on or after the date the Trust Preferred Securities are issued and sold, the Trust is or will be considered an investment company and is required to be registered under the Investment Company Act. (Section 1.1 of the Amended Trust Agreement.) Redemption Procedures The Trust may not redeem fewer than all the outstanding trust securities unless all accrued and unpaid distributions have been paid on all trust securities for all distribution periods terminating on or before the date of redemption. In the event that fewer than all of the outstanding trust securities are to be redeemed, the trust securities will be redeemed proportionately. If the Trust gives a notice of redemption in respect of the trust securities (which notice will be irrevocable), then, by 12:00 noon, New York City time, on the redemption date, and if we have paid to the Property Trustee a sufficient amount of cash in connection with the related redemption or maturity of the Junior Subordinated Notes held by it, the Property Trustee will irrevocably deposit with the depositary funds sufficient to pay the applicable redemption price and will give the depositary irrevocable instructions and authority to pay the redemption price to the holders of the Trust Preferred Securities, and the paying agent will pay the applicable redemption price to the holders of the trust common securities by check. If notice of redemption has been given and funds deposited as required, then, immediately prior to the close of business on the date of the deposit, distributions will cease to accrue and all rights of holders of Trust Preferred Securities called for redemption will cease, except the right of the holders of the Trust Preferred Securities to receive the redemption price but without interest on the redemption price. In the event that any date fixed for redemption of Trust Preferred Securities is not a business day, then payment of the redemption price payable on that date will be made on the next succeeding day that is a business day, without any interest or other payment in respect of any such delay, except that, if that business day falls in the next calendar year, payment will be made on the immediately preceding business day. In the event that payment of the redemption price in respect of Trust Preferred Securities is improperly withheld or refused and not paid either by the Trust or by us under the Guarantee, distributions on the Trust Preferred Securities will continue to accrue at the then applicable rate from the original redemption date to the date of payment, in which case the actual payment date will be considered the date fixed for redemption for purposes of calculating the redemption price. Subject to the foregoing and applicable law, including, without limitation, U.S. federal securities laws, we or our subsidiaries may at any time, and from time to time, purchase outstanding Trust Preferred Securities by tender, in the open market or by private agreement. (Section 7.4 of the Amended Trust Agreement.) Conversion or Exchange Rights The terms on which the Trust Preferred Securities are convertible into or exchangeable for common stock or our other securities will be contained in the applicable prospectus supplement. Those terms will include provisions as to whether conversion or exchange is mandatory, at the option of the holder or at our option, and may include provisions under which the number of shares of common stock or our other securities to be received by the holders of Trust Preferred Securities would be subject to adjustment. 18 Distribution of the Junior Subordinated Notes We will have the right at any time to dissolve the Trust and, after satisfaction of the liabilities of creditors of the Trust as provided by applicable law, to cause Junior Subordinated Notes formerly held by the Trust to be distributed to the holders of the Trust Preferred Securities in a total stated principal amount equal to the total stated liquidation amount of the Trust Preferred Securities then outstanding. Prior to any such dissolution, we will obtain any required regulatory approvals. The right to dissolve the Trust and distribute the Junior Subordinated Notes will be conditioned on our receipt of an opinion rendered by an independent tax counsel that the distribution would not result in the recognition of gain or loss for federal income tax purposes by the holders. (Section 8.1 of the Amended Trust Agreement.) Liquidation Distribution Upon Dissolution The amended trust agreement will state that the Trust will be dissolved: . upon our bankruptcy; . upon the filing of a certificate of dissolution or its equivalent with respect to us; . upon the filing of a certificate of cancellation with respect to the Trust after obtaining the consent of at least a majority in liquidation amount of the Trust Preferred Securities, voting together as a single class; . 90 days after the revocation of our charter, but only if the charter is not reinstated during that 90-day period; . upon the distribution of the related Junior Subordinated Notes formerly held by the Trust directly to the holders of the trust securities; . upon the redemption of all of the trust securities; or . upon entry of a court order for the dissolution of us or the Trust. (Section 8.1 of the Amended Trust Agreement.) In the event of a dissolution, after the Trust pays all amounts owed to creditors, the holders of the Trust Preferred Securities will be entitled to receive: . cash equal to the total liquidation amount of each Trust Preferred Security specified in an accompanying prospectus supplement, plus accumulated and unpaid distributions to the date of payment, or . Junior Subordinated Notes in a total principal amount equal to the total liquidation amount of the Trust Preferred Securities. If the Trust cannot pay the full amount due on its trust securities because insufficient assets are available for payment, then the amounts payable by the Trust on its trust securities will be paid proportionately. However, if an event of default under the related amended trust agreement occurs, the total amounts due on the Trust Preferred Securities will be paid before any distribution on the trust common securities. Under certain circumstances involving the dissolution of a Trust, subject to obtaining any required regulatory approval, Junior Subordinated Notes will be distributed to the holders of the trust securities in liquidation of that Trust. (Section 8.2 of the Amended Trust Agreement.) Trust Enforcement Events An event of default under the Subordinated Note Indenture relating to the Junior Subordinated Notes held by the Trust will be an event of default under the amended trust agreement (a Trust Enforcement Event). See DESCRIPTION OF DEBT SECURITIES--Events Of Default. 19 In addition, the voluntary or involuntary dissolution, winding up or termination of the Trust is also a Trust Enforcement Event, except in connection with: . the distribution of the Junior Subordinated Notes formerly held by the Trust to holders of the trust securities of the Trust, . the redemption of all of the trust securities of the Trust, and . mergers, consolidations or amalgamations permitted by the amended trust agreement of the Trust. Under the amended trust agreement, the holder of the trust common securities will be deemed to have waived any Trust Enforcement Event with respect to the trust common securities until all Trust Enforcement Events with respect to the Trust Preferred Securities have been cured, waived or otherwise eliminated. Until all Trust Enforcement Events with respect to the Trust Preferred Securities have been so cured, waived, or otherwise eliminated, the Property Trustee will be deemed to be acting solely on behalf of the holders of the Trust Preferred Securities and only the holders of the Trust Preferred Securities will have the right to direct the Property Trustee with respect to certain matters under the amended trust agreement and the Subordinated Note Indenture. In the event that any Trust Enforcement Event with respect to the Trust Preferred Securities is waived by the holders of the Trust Preferred Securities as provided in the amended trust agreement, under the amended trust agreement the holders of trust common securities have agreed that the waiver also constitutes a waiver of the Trust Enforcement Event with respect to the trust common securities for all purposes under the amended trust agreement without any further act, vote or consent of the holders of trust common securities. (Section 2.6 of the Amended Trust Agreement.) We and the Administrative Trustees must file annually with the Property Trustee a certificate evidencing compliance with all the applicable conditions and covenants under the amended trust agreement. (Section 2.4 of the Amended Trust Agreement.) Upon the occurrence of a Trust Enforcement Event involving an event of default under the Subordinated Note Indenture the Property Trustee, as the sole holder of a particular series of Junior Subordinated Notes, will have the right under the Subordinated Note Indenture to declare the principal of, interest and premium, if any, on the Junior Subordinated Notes held by the Trust to be immediately due and payable. If a Property Trustee fails to enforce its rights under the amended trust agreement or the Subordinated Note Indenture to the fullest extent permitted by law and subject to the terms of the amended trust agreement and the Subordinated Note Indenture, any holder of Trust Preferred Securities may sue us, or seek other remedies, to enforce the Property Trustee's rights under the amended trust agreement or the Subordinated Note Indenture without first instituting a legal proceeding against the Property Trustee or any other person. If a Trust Enforcement Event occurs and is continuing as a result of our failure to pay principal of or interest or premium, if any, on the Junior Subordinated Notes held by the Trust when payable, then a holder of the Trust Preferred Securities may directly sue us or seek other remedies, to collect its proportionate share of payments owned. See RELATIONSHIP AMONG THE TRUST PREFERRED SECURITIES, THE GUARANTEE AND THE JUNIOR SUBORDINATED NOTES HELD BY THE TRUST. Removal and Replacement of Trustees Only the holders of trust common securities have the right to remove or replace the trustees of the Trust, except that while an event of default in respect of the Junior Subordinated Notes held by the Trust has occurred or is continuing, the holders of a majority of the Trust Preferred Securities will have this right. The resignation or removal of any trustee and the appointment of a successor trustee will be effective only on the acceptance of appointment by the successor trustee in accordance with the provisions of the amended trust agreement. (Section 6.6 of the Amended Trust Agreement.) 20 Mergers, Consolidations or Amalgamations of the Trust The Trust may not consolidate, amalgamate, merge with or into, or be replaced by or convey, transfer or lease its properties and assets substantially as an entirety to any other corporation or other body (each, a Merger Event), except as described below. The Trust may, with the consent of a majority of its Administrative Trustees and without the consent of the holders of its trust securities, consolidate, amalgamate, merge with or into, or be replaced by another trust, provided that: . the successor entity either . assumes all of the obligations of the Trust relating to its trust securities, or . substitutes other securities for the trust securities that are substantially similar to the trust securities, so long as the successor securities rank the same as the trust securities for distributions and payments upon liquidation, redemption and otherwise; . we acknowledge a trustee of the successor entity who has the same powers and duties as the Property Trustee of the Trust, as the holder of a particular series of Junior Subordinated Notes; . the Trust Preferred Securities are listed, or any successor securities will be listed, upon notice of issuance, on the same securities exchange or other organization that the Trust Preferred Securities are then listed; . the Merger Event does not cause the Trust Preferred Securities or successor securities to be downgraded by any nationally recognized rating agency; . the Merger Event does not adversely affect the rights, preferences and privileges of the holders of the trust securities or successor securities in any material way, other than with respect to any dilution of the holders' interest in the new entity; . the successor entity has a purpose identical to that of the Trust; . prior to the Merger Event, we have received an opinion of counsel from a nationally recognized law firm stating that . the Merger Event does not adversely affect the rights of the holders of the Trust Preferred Securities or any successor securities in any material way, other than with respect to any dilution of the holders' interest in the new entity, and . following the Merger Event, neither the Trust nor the successor entity will be required to register as an investment company under the Investment Company Act; and . we guarantee the obligations of the successor entity under the successor securities in the same manner as in the Guarantee. In addition, unless all of the holders of the Trust Preferred Securities and trust common securities approve otherwise, the Trust will not consolidate, amalgamate, merge with or into, or be replaced by any other entity or permit any other entity to consolidate, amalgamate, merge with or into, or replace it, if, in the opinion of a nationally recognized tax counsel experienced in such matters, the transaction would cause the Trust or the successor entity to be classified other than as a grantor trust for U.S. federal income tax purposes. (Section 3.15 of the Amended Trust Agreement.) Voting Rights; Amendment of Trust Agreement The holders of Trust Preferred Securities have no voting rights except as discussed under DESCRIPTION OF THE TRUST PREFERRED SECURITIES--Mergers, Consolidations Or Amalgamations Of The Trust and DESCRIPTION OF THE GUARANTEE-- Amendments, and as otherwise required by law and the amended trust agreement. Except as otherwise provided in this Trust Agreement or by any applicable terms of the Securities, this Trust Agreement may only be amended by a written instrument approved and executed by the Sponsor and 21 (i) the Administrative Trustees (or, if there are more than two Administrative Trustees, a majority of the Administrative Trustees), (ii) the Property Trustee; and (iii) the Delaware Trustee if the amendment affects the rights, powers, duties, obligations or immunities of the Delaware Trustee. However, if any proposed amendment provides for, or the Administrative Trustees otherwise propose to, . change the amount or timing of any distribution of the Securities or otherwise adversely affect the amount of any distribution required to be made in respect of the Securities as of a specified date, . restrict the right of a Holder of Securities to institute suit for the enforcement of any such payment on or after such date, or effect then the holders of the Trust Preferred Securities as a single class will be entitled to vote on the amendment or proposal. In that case, the amendment or proposal will only be effective if approved by each Holder of the Securities in liquidation amount of the Trust Preferred Securities affected by the amendment or proposal. However, if any proposed amendment provides for, or the Administrative Trustees otherwise propose to, . effect any action that would adversely affect the powers, preferences or special rights of the trust securities, whether by way of amendment to the amended trust agreement or otherwise, or . effect the dissolution, winding-up or termination of the Trust other than under the terms of its amended trust agreement, then the holders of the Trust Preferred Securities as a single class will be entitled to vote on the amendment or proposal. In that case, the amendment or proposal will only be effective if approved by at least a majority in liquidation amount of the Trust Preferred Securities affected by the amendment or proposal. No amendment may be made to an amended trust agreement if that amendment would: . cause the Trust to be characterized as other than a grantor trust for U.S. federal income tax purposes; . reduce or otherwise adversely affect the powers of the Property Trustee; or . cause the Trust to be deemed to be an investment company which is required to be registered under the Investment Company Act. (Section 11.1 of the Amended Trust Agreement.) The holders of a majority of the total liquidation amount of the Trust Preferred Securities have the right to: . direct the time, method and place of conducting any proceeding for any remedy available to the Property Trustee; or . direct the exercise of any trust or power conferred upon the Property Trustee under the amended trust agreement, including the right to direct the Property Trustee, as the holder of a particular series of Junior Subordinated Notes, to . exercise the remedies available under the Subordinated Note Indenture with respect to the Junior Subordinated Notes held by the Trust, . waive any event of default under the Subordinated Note Indenture that is waivable, or . cancel an acceleration of the principal of the Junior Subordinated Notes held by the Trust. In addition, before taking any of the foregoing actions, the Property Trustee must obtain an opinion of counsel stating that, as a result of that action, the Trust will continue to be classified as a grantor trust for U.S. federal income tax purposes. (Section 7.5 of the Amended Trust Agreement.) As described in the form of amended trust agreement, the Property Trustee may hold a meeting to have holders of Trust Preferred Securities vote on a change or have them approve a change by written consent. If a vote by the holders of Trust Preferred Securities is taken or a consent is obtained, any Trust Preferred Securities owned by us or any of our affiliates will, for purposes of the vote or consent, be treated as if they were not outstanding, which will have the following consequences: . we and any of our affiliates will not be able to vote on or consent to matters requiring the vote or consent of holders of Trust Preferred Securities; and 22 . any Trust Preferred Securities owned by us or any of our affiliates will not be counted in determining whether the required percentage of votes or consents has been obtained. (Section 7.5 of the Amended Trust Agreement.) Information Concerning the Property Trustee For matters relating to compliance with the Trust Indenture Act, the Property Trustee will have all of the duties and responsibilities of an indenture trustee under the Trust Indenture Act. The Property Trustee, other than during the occurrence and continuance of a Trust Enforcement Event, undertakes to perform only the duties that are specifically described in the amended trust agreement and, upon a Trust Enforcement Event, must use the same degree of care and skill as a prudent person would exercise or use in the conduct of his or her own affairs. Subject to this provision, the Property Trustee is under no obligation to exercise any of the powers given it by the applicable amended trust agreement at the request of any holder of Trust Preferred Securities unless it is offered reasonable security or indemnity against the costs, expenses and liabilities that it might incur. (Section 3.9 of the Amended Trust Agreement.) Information Concerning the Administrative Trustees The Administrative Trustees are authorized and directed to conduct the affairs of and to operate the Trust in a way that: . will not cause it to be deemed to be an investment company required to be registered under the Investment Company Act; . will cause it to be classified as a grantor trust for U.S. federal income tax purposes; and . will cause the Junior Subordinated Notes it holds to be treated as our indebtedness for U.S. federal income tax purposes. We and the Administrative Trustees are authorized to take any action, so long as it is consistent with applicable law or the certificate of trust or amended trust agreement, that we and the Administrative Trustees determine to be necessary or desirable for those purposes. (Section 3.6 of the Amended Trust Agreement.) DESCRIPTION OF THE GUARANTEE We will execute the Guarantee from time to time for the benefit of the holders of the Trust Preferred Securities. The Chase Manhattan Bank will act as Guarantee Trustee under the Guarantee. The Guarantee Trustee will hold the Guarantee for the benefit of the holders of the Trust Preferred Securities to which it relates. The following description of the Guarantee is only a summary. The form of Guarantee is an exhibit to the registration statement. General We will irrevocably and unconditionally agree under the Guarantee to pay the Guarantee Payments that are defined below, to the extent specified in that Guarantee, to the holders of the Trust Preferred Securities to which the Guarantee relates, to the extent that the Guarantee Payments are not paid by or on behalf of the Trust. We are required to pay the Guarantee Payments to the extent specified in the Guarantee regardless of any defense, right of set-off or counterclaim that we may have or may assert against any person. (Section 5.1 of the Guarantee.) 23 The following payments and distributions on the Trust Preferred Securities of a Trust are Guarantee Payments: . any accrued and unpaid distributions required to be paid on the Trust Preferred Securities but only to the extent that the Trust has funds legally and immediately available for those distributions; . the redemption price for any Trust Preferred Securities that the Trust calls for redemption, including all accrued and unpaid distributions to the redemption date, but only to the extent that the Trust has funds legally and immediately available for the payment; and . upon a dissolution, winding-up or termination of the Trust, other than in connection with the distribution of Junior Subordinated Notes to the holders of Trust Securities or the redemption of all the Trust Preferred Securities, the lesser of: . the sum of the liquidation amount and all accrued and unpaid distributions on the Trust Preferred Securities to the payment date, to the extent that the Trust has funds legally and immediately available for the payment; and . the amount of assets of the Trust remaining available for distribution to holders of the Trust Preferred Securities in liquidation of the Trust. (Section 1.1 of the Guarantee.) We may satisfy our obligation to make a Guarantee Payment by making that payment directly to the holders of the related Trust Preferred Securities or by causing the Trust to make the payment to those holders. (Section 5.1 of the Guarantee.) The Guarantee will be a full and unconditional guarantee, subject to certain subordination provisions, of the Guarantee Payments with respect to the related Trust Preferred Securities from the time of issuance of those Trust Preferred Securities, except that the Guarantee will only apply to the payment of distributions and other payments on the Trust Preferred Securities when the Trust has sufficient funds legally and immediately available to make those distributions or other payments. If we do not make the required payments on the Junior Subordinated Notes that the Property Trustee holds under the Trust, the Trust will not make the related payments on its Trust Preferred Securities. Subordination Our obligations under the Guarantee will be unsecured obligations of the Company. Those obligations will rank: . subordinate and junior in right of payment to all of our other liabilities, other than obligations or liabilities that rank equal in priority or subordinate by their terms; . equal in priority with the Junior Subordinated Notes that we may issue and similar guarantees; and . senior to our common stock. (Section 6.2 of the Guarantee.) We have $139 million in Junior Subordinated Notes outstanding that will rank equal in priority with the Guarantee. We have common stock outstanding that will rank junior to the Guarantee. The Guarantee will be a guarantee of payment and not of collection. This means that the guaranteed party may institute a legal proceeding directly against us, as guarantor, to enforce its rights under the Guarantee without first instituting a legal proceeding against any other person or entity. (Section 5.4 of the Guarantee.) The terms of the Trust Preferred Securities will provide that each holder of the Trust Preferred Securities, by accepting those Trust Preferred Securities, agrees to the subordination provisions and other terms of the Guarantee. 24 Amendments We may amend the Guarantee without the consent of any holder of the Trust Preferred Securities to which the Guarantee relates if the amendment does not materially and adversely affect the rights of those holders. We may otherwise amend the Guarantee with the approval of the holders of at least a majority of the outstanding Trust Preferred Securities to which the Guarantee. (Section 9.2 of the Guarantee.) Termination The Guarantee will terminate and be of no further effect when: . the redemption price of the Trust Preferred Securities to which the Guarantee relates is fully paid; . we distribute the related Junior Subordinated Notes to the holders of those Trust Preferred Securities; or . the amounts payable upon liquidation of the Trust are fully paid. (Section 7.1 of the Guarantee.) The Guarantee will remain in effect or will be reinstated if at any time any holder of the related Trust Preferred Securities must restore payment of any sums paid to that holder with respect to those Trust Preferred Securities or under the Guarantee. Material Covenants We will covenant that, so long as any Trust Preferred Securities remain outstanding, if there is an event of default under the Guarantee or the amended trust agreement: . we will not make distributions related to our Debt Securities that rank equally with or junior to the Junior Subordinated Notes held by the Trust, including any payment of interest, principal or premium, or repayments, repurchases or redemptions; and . we will not make distributions related to our capital stock, including dividends, redemptions, repurchases, liquidation payments, or guarantee payments. We may, however, make the following types of distributions: . dividends paid in common stock; . dividends in connection with the implementation of a shareholder rights plan; . payments to a trust holding securities of the same series under a guarantee; and . repurchases, redemptions or other acquisitions of shares of our capital stock in connection with any benefit plan or other similar arrangement with or for the benefit of employees, officers, directors or consultants. (Section 6.1 of the Guarantee.) Our ability to meet our obligations under the Guarantee is dependent on our earnings and cash flows. The Trust, as holder of the Guarantee and a particular series of Junior Subordinated Notes will generally have a junior position to claims of our creditors, including trade creditors, debtholders, secured creditors, taxing authorities, guarantee holders and any preferred stockholders. Events of Default An event of default will occur under the Guarantee if we fail to perform any of our payment obligations under the Guarantee. The holders of a majority of the Trust Preferred Securities of any series may waive any such event of default and its consequences on behalf of all of the holders of the Trust Preferred Securities of that series. (Section 2.6 of the Guarantee.) The Guarantee Trustee is entitled to enforce the Guarantee for the benefit of the holders of the Trust Preferred Securities of a series if an event of default occurs under the Guarantee. (Section 3.1 of the Guarantee.) 25 The holders of a majority of the Trust Preferred Securities to which a Guarantee relates have the right to direct the time, method and place of conducting any proceeding for any remedy available to the Guarantee Trustee with respect to the Guarantee or to direct the exercise of any trust or power that the Guarantee Trustee holds under the Guarantee. Any holder of the related Trust Preferred Securities may institute a legal proceeding directly against us to enforce that holder's rights under the Guarantee without first instituting a legal proceeding against the Guarantee Trustee or any other person or entity. (Section 5.4 of the Guarantee.) Concerning the Guarantee Trustee The Chase Manhattan Bank is the Guarantee Trustee. It is also the Property Trustee, the Subordinated Note Indenture Trustee and the Senior Indenture Trustee. We and certain of our affiliates maintain deposit accounts and banking relationships with The Chase Manhattan Bank. The Chase Manhattan Bank also serves as trustee under other indentures pursuant to which securities of ours and certain of our affiliates are outstanding. The Guarantee Trustee will perform only those duties that are specifically set forth in each Guarantee unless an event of default under the Guarantee occurs and is continuing. In case an event of default occurs and is continuing, the Guarantee Trustee will exercise the same degree of care as a prudent individual would exercise in the conduct of his or her own affairs. (Section 3.1 of the Guarantee.) Subject to those provisions, the Guarantee Trustee is under no obligation to exercise any of its powers under any Guarantee at the request of any holder of the related Trust Preferred Securities unless that holder offers reasonable indemnity to the Guarantee Trustee against the costs, expenses and liabilities which it might incur as a result. (Section 3.2 of the Guarantee.) Agreements as to Expenses and Liabilities We will enter into an Agreement as to Expenses and Liabilities under the Trust Agreement. The Agreement as to Expenses and Liabilities will provide that we will, with certain exceptions, irrevocably and unconditionally guarantee the full payment of any indebtedness, expenses or liabilities of the Trust to each person or entity to whom the Trust becomes indebted or liable. The exceptions are the obligations of the Trust to pay to the holders of the related trust common or other similar interests in the Trust the amounts due to the holders under the terms of those trust common securities or those similar interests. RELATIONSHIP AMONG THE TRUST PREFERRED SECURITIES, THE GUARANTEE AND THE JUNIOR SUBORDINATED NOTES HELD BY THE TRUST We will guarantee payments of distributions and redemption and liquidation payments due on the Trust Preferred Securities, to the extent the Trust has funds available for the payments, to the extent described under DESCRIPTION OF THE GUARANTEE. No single document executed by us in connection with the issuance of the Trust Preferred Securities will provide for our full, irrevocable and unconditional guarantee of the Trust Preferred Securities. It is only the combined operation of our obligations under the Guarantee, the amended trust agreement and the Subordinated Note Indenture that has the effect of providing a full, irrevocable and unconditional guarantee of the Trust's obligations for the Trust Preferred Securities. As long as we make payments of interest and other payments when due on the Junior Subordinated Notes held by the Trust, those payments will be sufficient to cover the payment of distributions and redemption and liquidation payments due on the Trust Preferred Securities issued by the Trust, primarily because: . the total principal amount of the Junior Subordinated Notes held by the Trust will be equal to the sum of the total liquidation amount of the trust securities; . the interest rate and interest and other payment dates on the Junior Subordinated Notes held by the Trust will match the distribution rate and distribution and other payment dates for the Trust Preferred Securities; 26 . we will pay for any and all costs, expenses and liabilities of the Trust except its obligations under its Trust Preferred Securities; and . each amended trust agreement will provide that the Trust will not engage in any activity that is not consistent with the limited purposes of the Trust. If and to the extent that we do not make payments on the Junior Subordinated Notes held by the Trust, the Trust will not have funds available to make payments of distributions or other amounts due on its Trust Preferred Securities. In those circumstances, you will not be able to rely upon the Guarantee for payment of these amounts. Instead, you may directly sue us or seek other remedies to collect your proportionate share of payments owed. If you sue us to collect payment, then we will assume your rights as a holder of Trust Preferred Securities under the amended trust agreement to the extent we make a payment to you in any such legal action. ACCOUNTING TREATMENT The Trust will be treated as a subsidiary of ours for financial reporting purposes. Accordingly, our consolidated financial statements will include the accounts of the Trust. The Trust Preferred Securities, along with other Trust Preferred Securities that we guarantee on an equivalent basis, will be presented as a separate line item in our consolidated balance sheets, and appropriate disclosures about the Trust Preferred Securities, the Guarantee and the Junior Subordinated Notes held by the Trust will be included in the notes to the consolidated financial statements. We will record distributions that the Trust pays on the Trust Preferred Securities as an expense in our consolidated statement of income. DESCRIPTION OF PREFERRED STOCK The following description of the terms of the Preferred Stock sets forth certain general terms and provisions of our authorized Preferred Stock. If we offer Preferred Stock, the specific designations and rights will be described in the prospectus supplement and a description will be filed with the SEC. Our Board of Directors can, without approval of shareholders, issue one or more series of Preferred Stock. The Board can also determine the number of shares of each series and the rights, preferences and limitations of each series including the dividend rights, voting rights, conversion rights, redemption rights and any liquidation preferences of any wholly unissued series of Preferred Stock, the number of shares constituting each series and the terms and conditions of issue. The Preferred Stock will, when issued, be fully paid and non-assessable. Unless otherwise specified in the applicable prospectus supplement, the Preferred Stock will rank on a parity in all respects with any outstanding Preferred Stock we may have and will have priority over our common stock as to dividends and distributions of assets. Therefore, the rights of any Preferred Stock that may subsequently be issued may limit the rights of the holders of our common stock and Preferred Stock. The transfer agent, registrar, and dividend disbursement agent for a series of Preferred Stock will be named in a prospectus supplement. The registrar for shares of Preferred Stock will send notices to shareholders of any meetings at which holders of the Preferred Stock have the right to elect directors or to vote on any other matter. 27 PLAN OF DISTRIBUTION We may sell the offered securities (a) through agents; (b) through underwriters or dealers; or (c) directly to one or more purchasers. By Agents Offered securities may be sold through agents that we designate. The agents agree to use their reasonable best efforts to solicit purchases for the period of their appointment. By Underwriters If underwriters are used in the sale, the offered securities will be acquired by the underwriters for their own account. The underwriters may resell the securities in one or more transactions, including negotiated transactions, at a fixed public offering price or at varying prices determined at the time of sale. The obligations of the underwriters to purchase the securities will be subject to certain conditions. The underwriters will be obligated to purchase all the securities of the series offered if any of the securities are purchased. Any initial public offering price and any discounts or concessions allowed or re-allowed or paid to dealers may be changed from time to time. Direct Sales We may also sell offered securities directly. In this case, no underwriters or agents would be involved. General Information Underwriters, dealers and agents that participate in the distribution of the offered securities may be underwriters as defined in the Securities Act of 1933 (the Act), and any discounts or commissions received by them from us and any profit on the resale of the offered securities by them may be treated as underwriting discounts and commissions under the Act. Any underwriters or agents will be identified and their compensation described in a prospectus supplement. We may have agreements with the underwriters, dealers and agents to indemnify them against certain civil liabilities, including liabilities under the Act, or to contribute with respect to payments which the underwriters, dealers or agents may be required to make. Underwriters, dealers and agents may engage in transactions with, or perform services for, us or our subsidiaries in the ordinary course of their businesses. LEGAL OPINIONS McGuire, Woods, Battle & Boothe LLP, Richmond Virginia, counsel to the Company, will issue an opinion about the legality of the offered securities for us. Certain matters relating to the formation of the Trust and the issuance of the Trust Preferred Securities under Delaware law and the Trust Agreement will be passed upon by Richards, Layton & Finger, special Delaware counsel to the Trust and the Company. Any underwriters will be advised about other issues relating to any offering by their own legal counsel. EXPERTS The financial statements incorporated in this prospectus by reference from the Company's Annual Report on Form 10-K for the year ended December 31, 1999 have been audited by Deloitte & Touche LLP, 28 independent auditors, as stated in their report, which is incorporated by reference, and has been so incorporated in reliance upon the report of such firm given upon their authority as experts in accounting and auditing. Legal conclusions relating to the Company's franchises and title to its properties in the Company's Annual Report on Form 10-K and legal conclusions under Description of the Bonds and Description of the Senior Notes and Junior Subordinated Notes held by the Trust, including limitations upon the Company's issuance of Bonds, have been reviewed by McGuire, Woods, Battle & Boothe LLP, Richmond, Virginia, except that, with respect to the Bonds, insofar as matters relating to title to properties are governed by the laws of West Virginia, they have been reviewed by Jackson & Kelly, Charleston, West Virginia. The statements are included on the authority of such firms, respectively, as experts. 29 - ------------------------------------------------------------------------------- - ------------------------------------------------------------------------------- TABLE OF CONTENTS
Page ---- About This Prospectus.................................................... 1 Where You Can Find More Information...................................... 1 The Company.............................................................. 1 The Trust................................................................ 2 Use of Proceeds.......................................................... 2 Coverage Ratios.......................................................... 2 Description of the Bonds................................................. 3 Description of Debt Securities........................................... 5 Additional Terms of Senior Debt Securities............................... 12 Additional Terms of Junior Subordinated Notes............................ 13 Description of the Trust Preferred Securities............................ 15 Description of the Guarantee............................................. 23 Relationship Among the Trust Preferred Securities, the Guarantee and the Junior Subordinated Notes Held by the Trust............................. 26 Accounting Treatment..................................................... 27 Description of Preferred Stock........................................... 27 Plan of Distribution..................................................... 28 Legal Opinions........................................................... 28 Experts.................................................................. 28
- ------------------------------------------------------------------------------- - ------------------------------------------------------------------------------- - ------------------------------------------------------------------------------- - ------------------------------------------------------------------------------- LOGO $1,500,000,000 Mortgage Bonds Senior Debt Securities Junior Subordinated Notes Trust Preferred Securities and Related Guarantee Preferred Stock ---------------- PROSPECTUS ---------------- June , 2000 - ------------------------------------------------------------------------------- - ------------------------------------------------------------------------------- PART II INFORMATION NOT REQUIRED IN PROSPECTUS Item 14. Other Expenses of Issuance and Distribution.
Estimated ---------- Securities and Exchange Commission Fee (ACTUAL).................. $ 396,000 Fees and Expenses of Trustees.................................... 45,000 Rating Agency Fees............................................... 250,000 Printing Expenses................................................ 350,000 Accountants' Fees................................................ 120,000 Counsel Fees..................................................... 500,000 Recording Taxes & Fees, Listing Fees............................. 255,000 Miscellaneous.................................................... 100,000 ---------- Total.......................................................... $2,016,000 ==========
Item 15. Indemnification of Directors and Officers. Article VI of the registrant's Restated Articles of Incorporation, as amended, provides that the registrant shall indemnify its directors and officers to the fullest extent permitted by law. Article 10, Chapter 9, Title 13.1 of the Code of Virginia of 1950, as amended, permits indemnification of directors and officers but does not permit indemnification against willful misconduct or a knowing violation of the criminal law. The registrant maintains director and officer liability insurance protecting the registrant's directors and officers against certain claims resulting from their service in such capacities, and the registrant from the liability assumed by it in accordance with Article VI of its Restated Articles of Incorporation, as amended. The current policy covers all occurrences during the period ending September 1, 2001 and is expected to be renewed in the ordinary course of business. In general, the policy provides coverage for any misstatement, misleading statement, act, omission, neglect or breach of duty committed or attempted by a director or officer, but excludes, among other things, acts of deliberate dishonesty and acts for personal profit or advantage to which the director or officer was not entitled. Item 16. Exhibits.
Exhibit No. Description of Document ------- ----------------------- 1(i) Form of Underwriting Agreement relating to the Senior Debt Securities (filed herewith). 1(ii) Form of Underwriting Agreement relating to Preferred Stock (filed herewith). 1(iii) Form of Underwriting Agreement relating to Trust Preferred Securities (filed herewith). 1(iv) Form of Underwriting Agreement relating to Mortgage Bonds (filed herewith). 4(i) Articles of Incorporation as amended, as in effect on May 6, 1999 (Exhibit 3.1), Form 10-Q for the fiscal quarter ended March 31, 1999, File No. 1-2255, incorporated by reference). 4(ii) Bylaws as amended, as in effect on January 21, 2000 (Exhibit 3.2, Form 10-K for the fiscal year ended December 31, 1999, File No. 1-2255, incorporated by reference). 4(iii) Form of Senior Indenture, dated as of June 1, 1998 as supplemented by the First Supplemental Indenture (Exhibit 4.2 to Form 8-K dated June 12, 1998, File No. 1-2255, incorporated by reference); Second Supplemental Indenture (Exhibit 4.2 to Form 8-K dated June 3, 1999, File No. 1-2255, incorporated by reference) and Third Supplemental Indenture (Exhibit 4.2, Form 8-K, dated October 27, 1999, File No. 1- 2255, incorporated by reference).
II-1
Exhibit No. Description of Document ------- ----------------------- 4(iv) Subordinated Note Indenture, dated as of August 1, 1995 between Virginia Electric and Power Company and The Chase Manhattan Bank (formerly Chemical Bank), as Trustee, as supplemented (Exhibit 4(a), Form S-3 Registration Statement File No. 333-20561 as filed on January 28, 1997, incorporated by reference). 4(v) Indenture of Mortgage of the Company, dated November 1, 1935, as supplemented and modified by fifty-eight Supplemental Indentures (Exhibit 4(ii), Form 10-K for the fiscal year ended December 31, 1985, File No. 1-2255, incorporated by reference); Fifty-Ninth Supplemental Indenture (Exhibit 4(ii), Form 10-Q for the quarter ended March 31, 1986, File No. 1-2255, incorporated by reference); Sixtieth Supplemental Indenture (Exhibit 4(ii), Form 10-Q for the quarter ended September 30, 1986, File No. 1-2255, incorporated by reference); Sixty-First Supplemental Indenture (Exhibit 4(ii), Form 8-K, dated June 2, 1987, File No. 1-2255, incorporated by reference); Sixty-Second Supplemental Indenture (Exhibit 4(i), Form 8-K, dated November 3, 1987, File No. 1-2255, incorporated by reference); Sixty- Third Supplemental Indenture (Exhibit 4(i), Form 8-K, dated June 8, 1988, File No. 1-2255, incorporated by reference); Sixty-Fourth Supplemental Indenture (Exhibit 4(i), Form 8-K, dated February 8, 1989, File No. 1-2255, incorporated by reference); Sixty-Fifth Supplemental Indenture (Exhibit 4(i), Form 8-K, dated June 22, 1989, File No. 1-2255, incorporated by reference); Sixty-Sixth Supplemental Indenture (Exhibit 4(i), Form 8-K, dated February 27, 1990, File No. 1-2255, incorporated by reference); Sixty-Seventh Supplemental Indenture (Exhibit 4(i), Form 8-K, dated April 2, 1991, File No. 1- 2255, incorporated by reference); Sixty-Eighth Supplemental Indenture (Exhibit 4(i)), Sixty-Ninth Supplemental Indenture (Exhibit 4(ii)) and Seventieth Supplemental Indenture (Exhibit 4(iii), Form 8-K, dated February 25, 1992, File No. 1-2255, incorporated by reference); Seventy-First Supplemental Indenture (Exhibit 4(i)) and Seventy- Second Supplemental Indenture (Exhibit 4(ii), Form 8-K, dated July 7, 1992, File No. 1-2255, incorporated by reference); Seventy-Third Supplemental Indenture (Exhibit 4(i), Form 8-K, dated August 6, 1992, File No. 1-2255, incorporated by reference); Seventy-Fourth Supplemental Indenture (Exhibit 4(i), Form 8-K, dated February 10, 1993, File No. 1-2255, incorporated by reference); Seventy-Fifth Supplemental Indenture (Exhibit 4(i), Form 8-K, dated April 6, 1993, File No. 1-2255, incorporated by reference); Seventy-Sixth Supplemental Indenture (Exhibit 4(i), Form 8-K, dated April 21, 1993, File No. 1-2255, incorporated by reference); Seventy-Seventh Supplemental Indenture (Exhibit 4(i), Form 8-K, dated June 8, 1993, File No. 1-2255, incorporated by reference); Seventy-Eighth Supplemental Indenture (Exhibit 4(i), Form 8-K, dated August 10, 1993, File No. 1-255, incorporated by reference); Seventy-Ninth Supplemental Indenture (Exhibit 4(i), Form 8-K, dated August 10, 1993, File No. 1-2255, incorporated by reference); Eightieth Supplemental Indenture (Exhibit 4(i), Form 8-K, dated October 12, 1993, File No. 1-2255, incorporated by reference); Eighty-First Supplemental Indenture (Exhibit 4(iii), Form 10-K for the fiscal year ended December 31, 1993, File No. 1-2255, incorporated by reference); Eighty-Second Supplemental Indenture (Exhibit 4(i), Form 8-K, dated January 18, 1994, File No. 1-2255, incorporated by reference); Eighty-Third Supplemental Indenture (Exhibit 4(i), Form 8-K, dated October 19, 1994, File No. 1-2255, incorporated by reference); Eighty-Fourth Supplemental Indenture (Exhibit 4(i), Form 8-K, dated March 22, 1995, File No. 1-2255, incorporated by reference; and Eighty-Fifth Supplemental Indenture (Exhibit 4(i), Form 8-K, dated February 20, 1997, File No. 1-2255, incorporated by reference). 4(vi) Form of Fourth Supplemental Indenture to Senior Indenture (filed herewith). 4(vii) Form of Fifth Supplemental Indenture to Senior Indenture (filed herewith). 4(viii) Form of Second Supplemental Indenture to Subordinated Note Indenture (filed herewith). 4(ix) Form of Eighty-Sixth Supplemental Indenture to Indenture of Mortgage (filed herewith). 4(x) Form of Guarantee Agreement to be delivered by Virginia Electric and Power Company (filed herewith). 4(xi) Certificate of Trust of Virginia Power Capital Trust II (filed herewith).
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Exhibit No. Description of Document ------- ----------------------- 4(xii) Trust Agreement of Virginia Power Capital Trust II, dated May 26, 2000 (filed herewith). 4(xiii) Form of Amended and Restated Trust Agreement of Virginia Power Capital Trust II (filed herewith). 4(xiv) Form of Agreement as to Expenses and Liabilities (filed herewith). 5(i) Opinion of McGuire, Woods, Battle & Boothe LLP, counsel to the Issuer, with respect to the Offered Securities (filed herewith). 5(ii) Opinion of Richards, Layton & Finger, Delaware counsel to the Issuer, with respect to the Offered Securities (filed herewith). 12 Computation of Ratio of Earnings to Fixed Charges (filed herewith). 12(i) Computation of Ratio of Earnings to Fixed Charges and Preferred Stock Dividends (filed herewith). 23(i) Consent of McGuire, Woods, Battle & Boothe LLP (contained in Exhibit 5(i)). 23(ii) Consent of Richards, Layton & Finger (contained in Exhibit 5(ii)). 23(iii) Consent of Jackson & Kelly (filed herewith). 23(iv) Consent of Deloitte & Touche LLP (filed herewith). 24 Powers of Attorney (included herein). 25(i) Statement of Eligibility of The Chase Manhattan Bank for the Senior Debt Securities (filed herewith). 25(ii) Statement of Eligibility of The Chase Manhattan Bank for the Junior Subordinated Notes (filed herewith). 25(iii) Statement of Eligibility of The Chase Manhattan Bank for the Guarantee of Virginia Power Capital Trust II (filed herewith). 25(iv) Statement of Eligibility of The Chase Manhattan Bank for the Virginia Power Capital Trust II Trust Preferred Securities (filed herewith). 25(v) Statement of Eligibility of The Chase Manhattan Bank for the Mortgage Bonds (filed herewith).
Item 17. Undertakings. The undersigned registrants hereby undertake: (1) To file, during any period in which offers or sales are being made, a post-effective amendment to this registration statement: (i) To include any prospectus required by Section 10(a)(3) of the Securities Act of 1933; (ii) To reflect in the prospectus any facts or events arising after the effective date of the registration statement (or the most recent post- effective amendment thereof) which, individually or in the aggregate, represent a fundamental change in the information set forth in the registration statement. Notwithstanding the foregoing, any increase or decrease in volume of securities offered (if the total dollar value of securities offered would not exceed that which was registered) and any deviation from the low or high and of the estimated maximum offering range may be reflected in the form of prospectus filed with the SEC pursuant to Rule 424(b), if, in the aggregate, the changes in volume and price represent no more than 20 percent change in the maximum aggregate offering price set forth in the "Calculation of Registration Fee" table in the effective registration statement. II-3 (iii) To include any material information with respect to the plan of distribution not previously disclosed in the registration statement or any material change to such information in the registration statement; provided, however, that paragraphs (a)(1)(i) and (a)(1)(ii) do not apply if the information required to be included in a post-effective amendment by those paragraphs is contained in periodic reports filed with or furnished to the SEC by the registrants pursuant to Section 13 or Section 15(d) of the Securities Exchange Act of 1934 that are incorporated by reference in this registration statement. (2) That, for the purpose of determining any liability under the Securities Act of 1933, each such post-effective amendment shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof. (3) To remove from registration by means of a post-effective amendment any of the securities being registered which remain unsold at the termination of the offering. (4) The undersigned registrants hereby undertake that, for purposes of determining any liability under the Securities Act of 1933, each filing of each such registrant's annual report pursuant to Section 13(a) or 15(d) of the Securities Exchange Act of 1934 (and, where applicable, each filing of an employee benefit plan's annual report pursuant to Section 15(d) of the Securities Exchange Act of 1934) that is incorporated by reference in the registration statement shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof. (5) Insofar as indemnification for liabilities arising under the Securities Act of 1933 may be permitted to directors, officers and controlling persons of each registrant pursuant to the foregoing provisions, or otherwise, the registrants have been advised that in the opinion of the Securities and Exchange Commission such indemnification is against public policy as expressed in the Act and is, therefore, unenforceable. In the event that a claim for indemnification against such liabilities (other than the payment by a registrant of expenses incurred or paid by a director, officer or controlling person of such registrant in the successful defense of any action, suit or proceeding) is asserted by such director, officer or controlling person in connection with the securities being registered, each registrant agrees that it will, unless in the opinion of its counsel the matter has been settled by controlling precedent, submit to a court of appropriate jurisdiction the question whether such indemnification by it is against public policy as expressed in the Act and will be governed by the final adjudication of such issue. (6) The undersigned registrants hereby further undertake: (i) For purposes of determining any liability under the Securities Act of 1933, the information omitted from the form of prospectus filed as part of this registration statement in reliance upon Rule 430A and contained in a form of prospectus filed by such registrant pursuant to Rule 424(b)(1) or (4) or 497(h) under the Securities Act shall be deemed to be part of this registration statement as of the time it was declared effective. (ii) For the purpose of determining any liability under the Securities Act of 1933, each post-effective amendment that contains a form of prospectus shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof. II-4 SIGNATURES Pursuant to the requirements of the Securities Act of 1933, the registrant certifies that it has reasonable grounds to believe that it meets all of the requirements for filing on Form S-3, and has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in the City of Richmond, the Commonwealth of Virginia, on the 1st day of June 2000. Date: Virginia Electric and Power Company /s/ Thos. E. Capps By: _________________________________ (Thos. E. Capps, Chairman of the Board of Directors) Pursuant to the requirements of the Securities Act of 1933, this registration statement has been signed by the following persons in the capacities indicated and on the 1st of June 2000. The officers and directors whose signatures appear below hereby constitute James F. Stutts, Patricia A. Wilkerson, James P. Carney, Mark O. Webb, or Rhonda T. Boggs either of whom may act, as their true and lawful attorneys-in-fact, with full power to sign on their behalf individually and in each capacity stated below and file all amendments and post-effective amendments to the registration statement making such changes in the registration statement as the registrant deems appropriate, and generally to do all things in their name in their capacities as officers and directors to enable the registrant to comply with the provisions of the Securities Act of 1933 and all requirements of the Securities and Exchange Commission.
Signature Title --------- ----- /s/ Thos. E. Capps Chairman of the Board of Directors and ___________________________________________ Director Thos. E. Capps /s/ Thomas F. Farrell, II Chief Executive Officer and Director ___________________________________________ Thomas F. Farrell, II /s/ Edgar M. Roach, Jr. Chief Executive Officer and Director ___________________________________________ Edgar M. Roach, Jr. /s/ G. Scott Hetzer Senior Vice President and Treasurer ___________________________________________ G. Scott Hetzer /s/ Steven A. Rogers Vice President (Principal Accounting ___________________________________________ Officer) Steven A. Rogers
II-5 Pursuant to the requirements of the Securities Act of 1933, Virginia Power Capital Trust II has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in the City of Richmond, the Commonwealth of Virginia, on the 1st day of June 2000. Virginia Power Capital Trust II By Virginia Electric and Power Company, as Sponsor /s/ James P. Carney By: _________________________________ James P. Carney Assistant Treasurer II-6 EX-1.I 2 0002.txt AGREEMENT TO SENIOR DEBT SECURITIES EXHIBIT 1(I) VIRGINIA ELECTRIC AND POWER COMPANY Senior Debt Securities Series _, ____%, Due __________ FORM OF UNDERWRITING AGREEMENT [Date] [Name of Underwriter] as Representative for the Several Underwriters named in Schedule II hereto [Address of Representative] 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 Debt Securities (the Senior Debt Securities) 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 Debt Securities. Schedule I specifies the ----------------------------------------- aggregate principal amount of the Senior Debt Securities, the initial public offering price of the Senior Debt Securities, 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 Debt Securities and payment therefor. 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 Debt Securities. The Senior Debt Securities will be issued under the Company's Senior Indenture dated as of June 1, 1998, as supplemented by a First Supplemental Indenture dated as of June 1, 1998, a Second Supplemental Indenture dated as of June 1, 1999, a Third Supplemental Indenture, dated as of November 1, 1999 and to be further supplemented by a Fourth Supplemental Indenture dated as of ____, ______. 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-______ on Form S-3 for the registration of the Senior Debt Securities 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 Debt Securities included in the Registration Statement, which prospectus is now proposed to be supplemented by a supplement relating to the Senior Debt Securities 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), 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 2 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 Section (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 or the part of the Registration Statement which constitutes the Trustee's Statement of Eligibility under the Trust Indenture Act (the "Form T-1"); 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. The execution, delivery and performance of this the Indenture and Agreement and the issuance and sale of the Senior Debt Securities and compliance with the terms and provisions thereof will not result in a material breach or violation of any of the terms and provisions of, or constitute a default under, any statute, rule, regulation or order of any governmental agency or body or any court having jurisdiction over the Company or any subsidiary or any of their properties or any 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.] a party or by which the Company is bound or to which any of the properties of the Company is subject, or the articles of incorporation or bylaws of the Company, and the Company has full power and authority to authorize, issue and sell the Senior Debt Securities as contemplated by this Agreement. (f) The Senior Debt Securities, 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 Debt Securities. 3 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 Debt Securities 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 Debt Securities 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 Debt Securities ------------------------- 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 Debt Securities shall be made by wire transfer of immediately available funds to the Company's account on the Closing Date against delivery of the Senior Debt Securities, in fully registered form, Cede & Co., as nominee for The Depository Trust Company. The certificate(s) for the Senior Debt Securities will be made available at the location specified on Schedule I for examination by the Representatives 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 and the printing of this Agreement, (ii) the preparation, issue and delivery of certificates for the Senior Debt Securities, (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 Debt Securities. In addition, the Company will pay the reasonable out of pocket fees and disbursements of Underwriters' outside counsel, [Underwriters' Counsel], in connection with the qualification of the Senior Debt Securities 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, during the time when a prospectus relating to the Senior Debt Securities is required to be delivered under the Act, any event occurs as a result of which the Prospectus 4 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 Debt Securities 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. [and (iii) at its expense, furnish to the Representative a reasonable quantity of the prospectus as so supplemented or amended] In case any Underwriter is required to deliver a prospectus in connection with the sale of any Senior Debt Securities 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 Section 6(c), 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 [Underwriters' Counsel]. (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; [As soon as the Company is advised thereof, it will advise the Representative of the issuance of any stop order under the Securities Act with respect to the Registration Statement or any part thereof, or] 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. 5 (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 Debt Securities. (h) The Company will furnish such proper information as may be lawfully required and otherwise cooperate in qualifying the Senior Debt Securities 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 [Underwriters' Counsel] 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 Section 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 Debt Securities 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 Debt Securities, a certificate dated the Closing Date and signed by any Chief Executive Officer, any Chief Financial Officer, any Executive Vice President or any Senior 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 Commission pursuant to the Holding Company Act permitting the issuance and sale of the Senior Debt Securities shall be in full force and effect and 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 McGuire, Woods, Battle & Boothe, LLP., counsel to the Company and [Underwriters' Counsel], counsel 6 to the Underwriters, 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 7 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 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 Debt Securities 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 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 Debt Securities 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 material 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 8 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 Debt Securities 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 any Chief Executive Officers, any Chief Financial Officer, any Executive Vice President or any Senior Vice President of the Company. (vii) All legal proceedings to be taken in connection with the issuance and sale of the Senior Debt Securities shall have been satisfactory in form and substance to [Underwriters' Counsel]. (b) In case any of the conditions specified above in Section 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 subsections 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 greater than 50% or more of the aggregate principal amount of the Senior Debt Securities 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 Sections 6(b), 6(g) and 7(c) hereof. (c) If this Agreement shall be terminated by the Representative pursuant to Section 7(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 outside counsel as provided in Section 6(g)) 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 Section 6(b) and Section 9. 8. Conditions of the Obligation of the Company. The obligation of the ------------------------------------------- Company to deliver the Senior Debt Securities shall be subject to the conditions set forth in the first sentence of Section 7(a)(i) and in Section 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 Sections 6(b), 6(g), 9 and 10(c) hereof. 9 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 outside 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 Debt Securities 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 Section 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 Section 9(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 Debt Securities. (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 outside counsel fees) incurred by them in connection with investigating any such losses, claims, damages or liabilities or in connection with 10 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 Section 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 Debt Securities. (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 outside 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 outside 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 Section 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. Notwithstanding the foregoing sentence, an indemnifying party shall not be liable for any settlement of any proceeding 11 effected without its written consent (such consent not to be unreasonably withheld), but if settled with such consent or if there be a final judgment for the plaintiff, the indemnifying party agrees to indemnify the indemnified party from and against any loss or liability by reason of such settlement or judgment. No indemnifying party shall, without the prior written consent of the indemnified party, effect any settlement of any pending or threatened proceeding in respect of which indemnification may be sought hereunder (whether or not the indemnified party is an actual or potential party to such a proceeding), unless such settlement includes an unconditional release of such indemnified party from all liability on claims that are the subject matter of such proceeding. (d) If the indemnification provided for in this Section 9 is unavailable to or insufficient to hold harmless an indemnified party 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 the Underwriters, 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 Section 9(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 Section 9(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 Section 9(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 Section 9(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 Debt which it or they have agreed to purchase hereunder, and the aggregate principal amount of the Senior Debt Securities 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 Debt Securities, then the other Underwriters shall be obligated severally in the proportions which the principal amount of the Senior Debt Securities 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 Debt Securities 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 Debt Securities and the aggregate principal amount of the Senior Debt Securities with respect to which such default occurs is more than one-tenth of the aggregate principal amount of the Senior 12 Debt Securities and arrangements satisfactory to the Underwriters and the Company for the purchase of such Senior Debt Securities 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 Section 6(g) and Section 9) or of the Company (except as provided in Section 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 Debt Securities. 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 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 Debt Securities 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 East Cary Street, Richmond, Virginia 23219-3932. 13 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:_________________________________ Title: The foregoing agreement is hereby confirmed and accepted, as of the date first above written. [Name of Representation] By:________________________________ Title: Acting individually and on behalf of the other several Underwriters named in Schedule II hereto. 14 SCHEDULE I Title of Senior Debt Securities: 200_, Series _, ____ %, due [date] Senior Debt Securities Aggregate Principal Amount: $_____________ Initial Price to Public: % of the principal amount of the Senior Debt Securities plus accrued interest, if any, from the date of issuance Initial Purchase Price to be paid by Underwriters: % of the principal amount of the Senior Debt Securities Time of Delivery: [Closing Date and time] Closing Location: [Address] The Senior Debt Securities will be available for inspection by the Representative at: [Address] Address for Notices to the Underwriters: I-1 SCHEDULE II Principal Amount Underwriter of Senior Debt Securities to be Purchased - ----------- ----------------------------------------- II-1 SCHEDULE III PROPOSED FORM OF OPINION OF UNDERWRITER'S COUNSEL Re: VIRGINIA ELECTRIC AND POWER COMPANY ____ Series ___% Senior Debt Securities, due ___, 200_ __, 200_ [Name of Underwriter] as Representative for the Several Underwriters named in Schedule II hereto [Address of Underwriter] 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. $____ aggregate principal amount of its ____ Series ___% Senior Debt Securities, due ___, 200_ (the Senior Debt Securities) under and pursuant to a Senior Indenture, dated as of ____, 200_ between the Company and The Chase Manhattan Bank, as trustee (the Trustee), as supplemented by ____ Supplemental Indenture dated as of __, ____ (collectively, the Indenture), and the offering of the Senior Debt Securities by you pursuant to an Underwriting Agreement dated __, ____ 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 III-1 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 [Address], 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 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 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 as enforcement thereof may be limited by bankruptcy, insolvency, reorganization, moratorium or other similar laws affecting the enforcement of creditors' rights generally or by general equitable principles (regardless of whether enforcement is considered in a proceeding in equity or at law). D. The Senior Debt Securities have been duly authorized by the Company and, when executed by the Company and completed and authenticated by the Trustee in accordance with the Indenture and delivered and paid for as provided in the Underwriting Agreement, will have been duly issued under the Indenture and will constitute valid and binding obligations of the Company entitled to the benefits provided by the Indenture, except as enforcement thereof may be limited by bankruptcy, insolvency, reorganization, moratorium or other similar laws affecting the enforcement of creditors' rights generally or by general equitable principles (regardless of whether enforcement is considered in a proceeding in equity or at law). E. The Registration Statement (Reg. No. 333-___) with respect to the Senior Debt Securities 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 Senior Debt Securities 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 Debt Securities under DESCRIPTION OF THE SENIOR DEBT SECURITIES in the prospectus initially filed as part of the Registration Statement, as supplemented by the statements under the DESCRIPTION OF THE III-2 ____ SERIES SENIOR DEBT SECURITIES in the Prospectus Supplement dated __, ____ (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 (except the financial statements incorporated by reference therein, as to which we express no opinion) contained 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 Debt Securities on the terms and conditions set forth in the Underwriting Agreement has been issued, and such order remains in effect at this date and constitutes valid and sufficient authorization for the sale of the Senior Debt Securities as contemplated by the Underwriting Agreement. We understand such 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 Debt Securities 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 Debt Securities in such states) and the carrying out of the provisions of the Underwriting Agreement. G. The Senior Debt Securities conform in all material respects to their description in the Underwriting Agreement and to the statements with respect thereto contained in the Registration Statement and the Prospectus. To the extent that the opinion expressed in paragraph A involves matters governed by the laws of North Carolina and West Virginia, we have relied upon certificates of public officials in those states as to the Company's good standing and due authorization to transact business in those states. III-3 Very truly yours, UNDERWRITER'S COUNSEL III-4 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 ____ Series _____% Senior Debt Securities due ___, 200_ __, ____ [Name of Underwriter] as Representative for the Several Underwriters named in Schedule II hereto [Address of Underwriter] Ladies and Gentlemen: The arrangements for issuance of up to U.S. $______ aggregate principal amount of ____ Series ____% Senior Debt Securities, due ___, 200_ (the Senior Debt Securities), of Virginia Electric and Power Company (the Company) under a Senior Indenture dated as of ___, 200_ between the Company and [The Chase Manhattan Bank], as trustee (the Trustee), as supplemented by a ___ Supplemental Indenture dated as of __, ____ (collectively, the Indenture), and pursuant to an Underwriting Agreement dated __, ____, 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, IV-1 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 of the Company. On this basis we are of the opinion that: 1. The Company is a corporation duly organized and existing as a corporation in good standing 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 as described in the Prospectus and to issue the Senior Debt Securities. 2. All requisite corporate and governmental authorizations have been given for the issuance of the Senior Debt Securities under the 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 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 as enforcement thereof may be limited by bankruptcy, insolvency, reorganization, moratorium or other similar laws affecting the enforcement of creditors' rights generally or by general equitable principles (regardless of whether enforcement is considered in a proceeding in equity or at law). 5. The Senior Debt Securities have been duly authorized by the Company and, when duly executed by the Company and completed and authenticated by the Trustee in accordance with, and in the form contemplated by, the Indenture and issued, delivered and paid for in accordance with the Underwriting Agreement, will have been duly issued under the Indenture and will constitute valid and binding obligations of the Company entitled to the benefits provided by the Indenture, except as enforcement thereof may be limited by bankruptcy, insolvency, reorganization, moratorium or other similar laws affecting the enforcement of creditors' rights generally or by general equitable principles (regardless of whether enforcement is considered in a proceeding in equity or at law). IV-2 [representative] [date] Page 3 6. The Registration Statement (Reg. No. 333-____) with respect to the Senior Debt Securities 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 Debt Securities in the manner therein specified. The statements in regard to our firm under the caption EXPERTS in the Prospectus relating to the Senior Debt Securities are correct, and we are of the opinion that, so far as governed by the United States, North Carolina or Virginia, the legal conclusions relation 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 Debt Securities contained in the prospectus initially filed as part of the Registration Statement under DESCRIPTION OF THE SENIOR DEBT SECURITIES AND SUBORDINATED SENIOR DEBT SECURITIES, as supplemented by the statements under DESCRIPTION OF THE ____ SERIES __% SENIOR DEBT SECURITIES in the Prospectus Supplement dated __, ____, 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. 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 IV-3 [representative] [date] Page 4 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. [To the best of our knowledge, there are no actions, suits or proceedings pending or threatened to which the Company is a party or to which any of its properties is subject other than any proceedings described in the Prospectus and proceedings which we believe are not likely to have a material adverse effect on the power or ability of the Company to perform its obligations under the Underwriting Agreement or to consummate the transactions contemplated thereby or by the Prospectus.] 8. Except as set forth in the Registration Statement, there are no pending legal administrative or judicial proceedings. 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 IV-5 EX-1.II 3 0003.txt AGREEMENT TO PREFERRED STOCK EXHIBIT 1(ii) VIRGINIA ELECTRIC AND POWER COMPANY Preferred Stock FORM OF UNDERWRITING AGREEMENT [Date] [Name of Underwriter] as Representative for the Several Underwriters named in Schedule I hereto [Address of Representative] Ladies and Gentlemen: Virginia Electric and Power Company, a Virginia corporation (the Company), proposes to issue and sell to the several Underwriters named in Schedule I hereto for whom you are acting as Representative, _______ shares of its Series __ Preferred Stock (the Firm Shares). The Company also proposes to issue and sell to the several Underwriters not more than an additional _______ shares of Preferred Stock (the Additional Shares) if and to the extent the Representative shall have determined to exercise, on behalf of the Underwriters, the right to purchase such shares of Preferred Stock granted to the Underwriters in Section I hereof. The Firm Shares and the Additional Shares are hereinafter collectively referred to as the Shares. The shares of Preferred Stock of the Company to be outstanding after giving effect to the sales contemplated hereby are hereinafter referred to as the Preferred Stock. 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 I 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 I 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. Representations and Warranties of the Company. The Company --------------------------------------------- represents and warrants to, and agrees with, the Underwriters that: (a) A registration statement, No. 333-______ on Form S-3 for the registration of the Shares and certain other securities of the Company 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 Shares included in the Registration Statement, which prospectus is now proposed to be supplemented by a supplement relating to the Shares 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 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 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 Section (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 -2- 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 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. The execution, delivery and performance of this Agreement and the issuance and sale of the Shares will not result in a material breach or violation of any of the terms and provisions of, or constitute a default under, any statute, rule, regulation or order of any governmental agency or body or any court having jurisdiction over the Company or any subsidiary or any of their properties or, to the best of such counsel's knowledge, any 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.] a party or by which the Company is bound or to which any of the properties of the Company is subject, or the articles of incorporation or bylaws of the Company, and the Company has full power and authority to authorize, issue and sell the Shares as contemplated by this Agreement. (e) The Shares, 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 Shares. [(g) The Preferred Stock (other than the Shares) is and, upon issuance the Shares will be, listed on the New York Stock Exchange. Company will use best efforts to complete listing of the shares on the New York Stock Exchange] -3- 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, place and time hereinafter specified, the number of Shares set forth opposite the name of such Underwriter in Schedule I hereto at a price of $_____ per share (the "Purchase Price"). The Company is further advised by the Underwriters that the Shares are to be offered by the Underwriters to the public initially at $______ a share (the "Public Offering Price") and to certain dealers selected by the Representatives at a price that represents a concession not in excess of $__.__ a share under the Public Offering Price, and that any Underwriter may allow, and such dealers may reallow, a concession, not in excess of $____ a share, to any Underwriter or to certain other dealers. 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. (a) On the basis of the representations and warranties contained in this Agreement, and subject to its terms and conditions, the Company agrees to sell to the Underwriters the Additional Shares, and the Underwriters shall have a one-time right to purchase, severally and not jointly, all or part of ________ the Additional Shares at the Purchase Price. Additional Shares may be purchased as provided in Section 4 hereof solely for the purpose of covering over-allotments made in connection with the offering of the Firm Shares. If any Additional Shares are to be purchased, each Underwriter agrees, severally and not jointly, to purchase the number of Additional Shares (subject to such adjustments to eliminate fractional shares as the Representative may determine) that bears approximately the same proportion to the total number of Additional Shares to be purchased as the number of Firm Shares set forth in Schedule I hereto opposite the name of such Underwriter bears to the total number of Firm Shares. (b) The Company hereby agrees that, without the prior written consent of the Representative, it will not during the period ending 60 days after the date of the Prospectus (i) offer, pledge, sell, contract to sell, sell any option or contract to purchase, purchase any option or contract to sell, grant any option, right or warrant to purchase or otherwise transfer or dispose of, directly or indirectly, or to register or announce the sale or offering of any shares of Preferred Stock of the Company or any securities convertible into or exercisable or exchangeable for such Preferred Stock or (ii) enter into any agreement that transfers, in whole or in part, the economic consequences of ownership of such Preferred Stock, whether any such transaction described in clause (i) or (ii) above is to be settled by delivery of such Preferred Stock or such other securities in cash or otherwise. The foregoing (a) the Shares to be sold hereunder; (b) the issuance by the Company of shares of Preferred Stock upon the exercise of an option or warrant or the conversion of a security outstanding on the date hereof of which the Underwriters have been advised in writing. 5. Time and Place of Closing. Payment for the Firm Shares shall be made ------------------------- by or on behalf of the several Underwriters by the wire transfer of immediately available funds to the -4- Company's account. Such payment shall be made upon delivery of the Firm Shares to the Representative or upon its order at the office of the Representative, [Address], at 10:00 A.M., New York City time, on the third business day (unless postponed in accordance with the provisions of Section 10) following the date of this Agreement, or if pricing takes place after 4:30 P.M. New York time, on the fourth business day following the date of this Agreement (unless postponed in accordance with the provisions of Section 10), or at such other time on the same or such other earlier date, as shall be agreed upon by the Representative and the Company. The time and date of such payment are hereinafter referred to as the Closing Date. Payment for any Additional Shares shall be made by or on behalf of the several Underwriters by the wire transfer of immediately available funds to the Company's account. Such payment shall be made upon delivery of the Additional Shares to the Representative or upon its order at the office of the Representative, [Address], at 10:00 A.M., New York City time, on such date (which may be the same as the Closing Date but shall in no event be earlier than the Closing Date nor later than ten business days after the giving of the notice hereinafter referred to) as shall be designated in a written notice from the Representative to the Company of the Representative's determination, on behalf of the Underwriters, to purchase a number, specified in said notice, of Additional Shares, or on such other date, in any event not later than ______ 200__, as shall be agreed upon by the Representative and the Company. The time and date of such payment are hereinafter referred to as the Option Closing Date. The notice of the determination to exercise the option to purchase Additional Shares and of the Option Closing Date may be given at any time within 30 days after the date of this Agreement. Certificates for the Firm Shares and Additional Shares shall be in definitive form and registered in such names and in such denominations as the Representative shall request in writing not later than one full business day prior to the Closing Date or the Option Closing Date, as the case may be. The certificates evidencing the Firm Shares and Additional Shares shall be delivered to the Representative on the Closing Date or the Option Closing Date, as the case may be, for the respective accounts of the several Underwriters, with any transfer taxes payable in connection with the transfer of the Shares to the Underwriters duly paid, against payment of the Purchase Price therefor. 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 -5- filing by it of the Registration Statement and Prospectus and the printing of this Agreement, (ii) the preparation, issue and delivery of certificates for the Shares, (iii) 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 Shares. In addition, the Company will pay the reasonable out of pocket fees and disbursements of Underwriters' outside counsel, [Underwriters' Counsel], in connection with the qualification of the Shares 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, during the time when a prospectus relating to the Shares 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 Shares 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 [, and (iii) at its expense, furnish to the Representative a reasonable quantity of the prospectus as so supplemented or amended.] In case any Underwriter is required to deliver a prospectus in connection with the sale of any Shares 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 Section 6(c), 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 [Underwriters' Counsel]. (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 [As soon as the Company is advised thereof, it will advise the Representative of the issuance of any stop order under the Securities Act with respect to the Registration Statement or any part thereof, or] 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. -6- (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. (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 Shares. (h) The Company will furnish such proper information as may be lawfully required and otherwise cooperate in qualifying the Shares 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. (g) Fees and disbursements of [Underwriter Counsel]. 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 Section 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 Shares 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 -7- threatened by, the Commission on such date. The Representative shall have received, prior to payment for the Shares, a certificate dated the Closing Date and signed by any Chief Executive Officer, any Chief Financial Officer, any Executive Vice President or any Senior 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 Commission pursuant to the Holding Company Act permitting the issuance and sale of the Shares shall be in full force and effect and 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 McGuire, Woods, Battle & Boothe, LLP, counsel to the Company and [Underwriters' Counsel], counsel to the Underwriters, substantially in the forms attached hereto as Schedules II and III. (a) At the time of execution of this Agreement and as of the Closing Date, the Representative shall have received letters, on behalf of the Underwriters, dated as of the date hereof and as of the Closing Date, in form and substance satisfactory to the Representative, from the Company's independent public accountants, containing statements and information of the type ordinarily included in accountants' SAS 72 "comfort letters" to underwriters with respect to the financial statements and certain financial information contained in or incorporated by reference into the Prospectus. (b) 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 Shares of the Company (other than a decrease in the aggregate number thereof outstanding), (2) any material adverse change in the general affairs, financial condition or earnings of the Company 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 -8- that it makes it inadvisable to proceed with the public offering or delivery of the Shares 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 any of the Company's senior securities 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 material 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 Shares on the terms and in the manner contemplated in the Prospectus and in this Agreement. (c) 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 Chairman of the Board, Chief Executive Officer, President or any Executive or Senior Vice President of the Company. (d) All legal proceedings to be taken in connection with the issuance and sale of the Shares shall have been satisfactory in form and substance to [Underwriters' Counsel]. (iv) In case any of the conditions specified above in Section 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 Section 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 greater than 50% or more of the aggregate principal amount of the Shares 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 Sections 6(b), 6(g) and 7(c) hereof. -9- (v) If this Agreement shall be terminated by the Representative pursuant to Section 7(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 outside counsel as provided in Section 6(g)) 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 Section 6(b) and Section 9. (vi) The several obligations of the Underwriters to purchase Additional Shares hereunder are subject to the delivery to the Representative on the Option Closing Date of such documents and opinions as the Representative may reasonably request with respect to the good standing of the Company, the due authorization and issuance of the Additional Shares and other matters related to the issuance of the Additional Shares. 8. Conditions of the Obligation of the Company. The obligation of the ------------------------------------------- Company to deliver the Shares shall be subject to the conditions set forth in the first sentence of Section 7(a)(i) and in Section 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 Sections 6(b), 6(g), 9 and 10(c) 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 outside 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, -10- 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 Shares 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 Section 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 Section 9(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 Shares. (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 outside 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 Section 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 -11- Underwriter or any such controlling person, and shall survive the delivery of the Shares. (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 outside 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 outside 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 Section 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. Notwithstanding the foregoing sentence, an indemnifying party shall not be liable for any settlement of any proceeding effected without its written consent (such consent not to be unreasonably withheld), but if settled with such consent or if there be a final judgment for the plaintiff, the indemnifying party agrees to indemnify the indemnified party from and against any loss or liability by reason of such settlement or judgment. No indemnifying party shall, without the prior written consent of the indemnified party, effect any settlement of any pending or threatened proceeding in respect of which indemnification may be sought hereunder (whether or not the indemnified party is an actual or potential party to such a proceeding), unless such settlement includes an unconditional release of such indemnified party from all liability on claims that are the subject matter of such proceeding. (d) If the indemnification provided for in this Section 9 is unavailable to or insufficient to -12- hold harmless an indemnified party 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 the Underwriters, 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 Section 9(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 Section 9(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 Section 9(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 Section 9(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 Shares which it or they have agreed to purchase hereunder, and the aggregate principal amount of the Shares 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 Shares, then the other Underwriters shall be obligated severally in the proportions which the principal amount of the Shares set forth opposite their respective names in Schedule I bears to the aggregate underwriting obligations of all non-defaulting Underwriters, or in such other proportions as the Underwriters may specify, to purchase the Shares 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 Shares and the aggregate principal amount of the Shares with respect to which such default occurs is more than one-tenth of the aggregate principal amount of the Shares and arrangements satisfactory to the Underwriters and the Company for the purchase of such Shares 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 Section 6(g) and Section 9) or of the Company (except as provided in Section 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 -13- 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 Shares. 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 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 Shares 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 East Cary Street, Richmond, Virginia 23219-3932. -14- 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:_________________________________ Title: The foregoing agreement is hereby confirmed and accepted, as of the date first above written. [Name of Representative] By:________________________________ Title: Acting individually and on behalf of the other several Underwriters named in Schedule I hereto. -15- SCHEDULE I - -------------------------------------------------------------------------------- Underwriter Number of Firm Shares To Be Purchased - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- Total I-1 SCHEDULE II PROPOSED FORM OF OPINION OF MCGUIRE, WOODS, BATTLE & BOOTHE LLP One James Center 901 East Cary Street Richmond, Virginia 23219 ______, 200_ [Name of Underwriter] as Representative for the Several Underwriters named in Schedule I hereto [Address of Representative] Re: Virginia Electric and Power Company Preferred Stock Offering Ladies and Gentlemen: We have acted as counsel to Virginia Electric and Power Company, a Virginia corporation (the "Company"), in connection with the issuance and sale by the Company of ____ shares (the "Shares") of its preferred stock pursuant to an underwriting agreement dated ____________, 200__ (the "Underwriting Agreement") among the Company and ____________ (the "Underwriters"), and the several other underwriters named therein. This opinion is rendered pursuant to the provisions of Section 7(a)(iii) of the Underwriting Agreement, and, except a set forth herein, the terms used herein which are defined in the Underwriting Agreement have the same meanings as they have in the Underwriting Agreement. We have examined the Underwriting Agreement, a specimen certificate for the Preferred Stock, the Articles of Incorporation and the By-laws of the Company and such other corporate records of the Company, agreements and other instruments, certificates of public officials, certificates of officers and representatives of the Company, and other documents and have conducted such other investigations of facts and law as we have deemed necessary or advisable for purposes of this opinion. As to certain facts material to the opinions expressed herein, we II-1 have relied upon the representations and warranties contained in the documents examined by us. Whenever the phrases "to our knowledge" or "known to us" are used herein, they refer to the actual knowledge of the attorneys of this firm generally involved in the representation of the Company. 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 of the Company. For purposes of the opinions expressed below, we have assumed (i) the authenticity of all documents submitted to us as originals, (ii) the conformity to the originals of all documents submitted as certified or photostatic copies and the authenticity of the originals of such copies, (iii) the genuineness of signatures not witnessed by us, (iv) the legal capacity of natural persons, and (v) the due authorization, execution and delivery of all documents by all parties and the validity and binding effect thereof (other than the authorization, execution and delivery of documents by the Company, and the validity and binding effect upon the Company). Based upon and subject to the foregoing as well as the qualifications hereinafter set forth, we are of the opinion that: (A) The Company has been duly incorporated, is validly existing as a corporation in good standing under the laws of the Commonwealth of Virginia and is duly qualified as a foreign corporation in West Virginia and North Carolina, has the corporate power and authority to own, lease and operate its property and to conduct its business as described in the Prospectus and to enter into and perform its obligations under this Agreement; and is duly qualified as a foreign corporation in each jurisdiction in which the conduct of its business or its ownership or leasing of property requires such qualification, except to the extent that the failure to be so qualified would not have a material adverse effect on the Company and its subsidiaries, taken as a whole. (B) The execution and delivery by the Company of the Underwriting Agreement and the performance by the Company of its obligations thereunder have been duly authorized by all necessary corporate action on the part of the Company; and the Underwriting Agreement has been duly executed and delivered by the Company. (C) The Preferred Stock of the Company conforms in all material respects to the description thereof in the Prospectus. II-2 (D) The Shares have been duly authorized and are validly issued, fully paid and non-assessable. The Shares are not subject to any preemptive or similar rights. The Shares have been duly authorized for listing on the New York Stock Exchange (the "NYSE"). (E) The execution and delivery by the Company of, and the performance by the Company of its obligations under, the Underwriting Agreement and the issuance and sale by the Company of the Shares do not and will not contravene the Articles of Incorporation or the By-laws of the Company or any provision of any law of the Commonwealth of Virginia, the State of New York or U.S. federal law or, to our knowledge, any judgment, order or decree of any U.S. federal court or government agency or any court or government agency of the State of New York or the Commonwealth of Virginia having jurisdiction over the Company. No approval, authorization or consent of any U.S. federal, New York, or Virginia court or governmental authority or agency is required in connection with the consummation by the Company of the transactions contemplated by the Underwriting Agreement, except such as have been obtained or will have been obtained prior to the Closing Date or as may be required under state securities laws. (F) To the best of our knowledge, there are no actions, suits or proceedings pending or threatened to which the Company is a party or to which any of its properties is subject other than any proceedings described in the Prospectus and proceedings which we believe are not likely to have a material adverse effect on the power or ability of the Company to perform its obligations under the Underwriting Agreement or to consummate the transactions contemplated thereby or by the Prospectus. (G) We have reviewed the Registration Statement and Prospectus and participated in conferences with officers and other representatives of the Company, representatives of the independent public accountants for the Company and with your representatives and representatives of your counsel at which conferences the contents of the Registration Statement and Prospectus and related matters were discussed and have also reviewed certain corporate records, documents and proceedings, and, although we are not passing upon and do not assume any responsibility for the accuracy, completeness or fairness of the statements contained in the Prospectus (except to the extent set forth in paragraphs (I) below and (D) above), on the basis of the foregoing, no facts have come to our attention which have led us to believe that, as of its effective date, the Registration Statement contained an untrue statement of a material fact or omitted to state a material fact required to be stated therein or necessary to make the statements therein not misleading or that, as of its date or the Closing Date, the Prospectus contained or contains an untrue statement of a material fact or omitted or omits to state a material fact necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading (except that we express no comment or belief with respect to the II-3 financial statements and schedules and other financial or statistical information contained in the Registration Statement or Prospectus). (H) [The statements in (A) the Prospectus under the captions "Virginia Stock Corporation Act and the Articles and By-laws" and "Description of Capital Stock -- Preferred Stock," and (B) in the Registration Statement in Item 15, insofar as such statements constitute a summary of the legal matters, documents or proceedings referred to therein, fairly summarize the matters referred to therein in all material respects (except that we express no comment or belief with respect to the financial statements and schedules and other financial or statistical information contained in the Registration Statement or Prospectus).] (I) Each of the Registration Statement and the Prospectus, when it became effective or was filed with the Commission, as the case may be, appeared on its face to be appropriately responsive in all material respects to the requirements of the Act and the rules and regulations of the Commission thereunder (except that we express no comment or belief with respect to the financial statements and schedules and other financial or statistical information contained in the Registration Statement or Prospectus). (J) The form of the certificate for the Shares conforms in all material respects to the requirements of the Virginia Stock Corporation Act and the NYSE. (K) The Company is not, and following consummation of the transactions contemplated by the Underwriting Agreement will not be, an "investment company" or a company "controlled" by an "investment company" which is required to be registered under the Investment Company Act of 1940, as amended. We do not purport to express an opinion on any laws other than those of the Commonwealth of Virginia, the State of New York and the United States of America. [Underwriters Counsel] may rely on this opinion in connection with the opinions they are delivering on the date hereof with respect to the matters set forth herein to the extent that such opinion involves matters governed by the laws of the Commonwealth of Virginia. Our opinion in paragraph (F) as to non-contravention of the laws of the State of New York is based upon a review of those laws and statutes which, in our experience, are normally applicable to transactions of the type contemplated by the Underwriting Agreement. We do not express any opinion herein on whether the provisions of the Underwriting Agreement regarding rights to indemnity and contribution contravene or are limited by federal or state securities laws or public policy. This opinion letter may not be relied upon by, nor may copies be delivered to, any person without our prior written consent. Very truly yours, II-4 SCHEDULE III PROPOSED FORM OF OPINION OF UNDERWRITER'S COUNSEL [DATE] [Name of Underwriter] as Representative for the Several Underwriters named in Schedule I hereto [Address of Representative] Re: Virginia Electric and Power Company--Offering of _______ Shares of Preferred Stock Ladies and Gentlemen: We have acted as counsel for you (the "Underwriters") in connection with the purchase today by you severally of _______ shares (the "Shares") of the preferred stock of Virginia Electric and Power Company, a Virginia corporation (the "Company"), pursuant to the terms of an underwriting agreement dated ____________, 200__ (the "Underwriting Agreement") among the Company and you. This letter is being delivered to you pursuant to the provisions of Section 7(a)(iii) of the Underwriting Agreement. Terms used in this letter which are not defined herein but which are defined, either directly or by cross-reference, in the Underwriting Agreement are used herein with the respective meanings assigned to such terms in the Underwriting Agreement. In connection therewith, we have examined (a) the Registration Statement on Form S-3 (Registration No. _______________ thereto, filed by the Company with the Securities and Exchange Commission (the "Commission") under the Securities Act of 1933, as amended (the "Act"), relating to the registration of the Shares, as it became effective under the Act (such Registration Statement, as so amended and including documents incorporated therein by reference, being hereinafter referred to as the "Registration Statement"), (b) the Company's Prospectus Supplement, dated ___________, 2000, as filed in final form with the Commission III-1 on ______________, 200_ pursuant to Rule 424(b) under the Act (such Prospectus Supplement, together with the Prospectus included as part of the Registration Statement and documents incorporated therein by reference, the "Prospectus", (c) executed counterparts of the Underwriting Agreement, (d) a copy of the Articles of Incorporation of the Company, (e) a copy of the By-Laws of the Company, (f) a specimen certificate for the Preferred Stock and (g) a record of corporate proceedings of the Company relating to the authorization of the public offering, including the execution and delivery of the Underwriting Agreement. In addition, we have examined certificates of public officials and the originals (or copies certified or otherwise identified to our satisfaction) of such other agreements, certificates, documents and records and have reviewed such questions of law as we have deemed necessary or appropriate for the purposes of the opinions rendered herein. In such examination, we have assumed, without inquiry, the genuineness of all signatures on all documents examined by us, the authenticity of all documents submitted to us as originals, the conformity to authentic original documents of all documents submitted to us as copies and the authenticity of the originals of such latter documents. In addition, we have assumed, without inquiry, that the Underwriting Agreement has been duly authorized, executed and delivered by all parties other than the Company, and that the certificates representing the Shares being issued on the date hereof conform in all respects to the specimens examined by us. As to any facts material to our opinion, we have, when relevant facts were not independently established, relied on the aforesaid agreements, instruments, certificates, documents and records. Based on the foregoing, and subject to the qualifications, assumptions and limitations stated herein, we are of the opinion that: (L) The Company is validly existing as a corporation in good standing under the laws of the Commonwealth of Virginia; (M) The Underwriting Agreement has been duly authorized, executed and delivered by the Company; (N) the Shares have been duly authorized and are validly issued, fully paid and non-assessable; and (O) 'The statements in the Prospectus under the captions "Description of Capital Stock -- Preferred Stock" and "Underwriters," insofar as such statements constitute a summary of the legal matters, documents or proceedings referred to therein, fairly summarize the matters referred to therein in all material respects. As your counsel, we have reviewed the Registration Statement and Prospectus, participating in discussions with representatives of the Underwriters and of the Company and its accountants at which contents of the Registration Statement and Prospectus and related matters III-2 were discussed. We did not participate in the preparation of the Registration Statement (other than the Prospectus Supplement) or any of the documents (other than the Underwriting Agreement) incorporated by reference therein. Although we are not passing upon, and do not assume any responsibility for, the accuracy, completeness or fairness of the statements contained in the Registration Statement or the Prospectus (except as described in paragraph (iv) hereof), based on the foregoing, no facts have come to our attention in the course of such review which have led us to believe that, as of its effective date, the Registration Statement (other than the financial statements and the financial, accounting and statistical data and related schedules incorporated by reference or included therein or excluded therefrom, as to which we express no opinion) contained an untrue statement of a material fact or omitted to state a material fact required to be stated therein or necessary to make the statements therein not misleading or that, as of its date or the date hereof, the Prospectus (other than the financial statements and financial, accounting and statistical data and related schedules incorporated by reference or included therein or excluded therefrom, as to which we express no opinion) contained or contains an untrue statement of a material fact or omitted or omits to state a material fact necessary to make the statements therein, in light of the circumstances under which they were made, not misleading. The opinions rendered herein are limited to the laws of the State of New York and the Federal law of the United States. In rendering the foregoing opinions, we have, with your consent, relied solely upon the opinion of McGuire, Woods, Battle & Boothe LLP, dated the date hereof and addressed to you, as to all matters under the laws of the Commonwealth of Virginia, and our opinions rendered herein as to such matters are subject to the same qualifications, assumptions and limitations as are set forth in such opinion. This letter and the opinions rendered herein are furnished by us as counsel to you in connection with the transactions contemplated by the Underwriting Agreement and solely for your benefit and may not be delivered to or relied upon in any manner by any other person or entity without our express written consent. Very truly yours, III-3 EX-1.III 4 0004.txt AGREEMENT TO TRUST PREFERRED SECURITIES _____________ Trust Preferred Securities VIRGINIA POWER CAPITAL TRUST II guaranteed by VIRGINIA ELECTRIC AND POWER COMPANY PURCHASE AGREEMENT [Date] [Name of Representative], for itself and the other several Underwriters named in Schedule I, attached hereto [Address of Representative] Ladies and Gentlemen: Virginia Power Capital Trust II (the Trust), a statutory business trust created under the Business Trust Act (the Delaware Act) of the State of Delaware (Chapter 38, Title 12, of the Delaware Code, 12 Del. C. Sections 3801 et seq.) and Virginia Electric and Power Company, a Virginia corporation (the Company and, together with the Trust, the Offerors), confirm their agreement (the Agreement) with [Name of Representative] (the Representative), and each of the other Underwriters named in Schedule I (collectively, including the Representative, the Underwriters), with respect to the issue and sale by the Trust and the purchase by the Underwriters, acting severally and not jointly, of the respective number set forth opposite their names in Schedule I of the __________ ____% Trust Preferred Securities (liquidation amount of $______ per security) of the Trust (the Trust Preferred Securities). The Trust Preferred Securities will be guaranteed by the Company, to the extent described in the Prospectus (as defined below), with respect to distributions and payments upon liquidation, redemption and otherwise pursuant to the Trust Preferred Securities Guarantee Agreement (the Trust Preferred Securities Guarantee), to be dated as of __________ ___, 200__, between the Company and The Chase Manhattan Bank, as Trustee (the Guarantee Trustee). The Trust Preferred Securities issued in book-entry form will be issued to Cede & Co., as nominee of The Depository Trust Company (DTC), pursuant to a letter of representations, to be dated on or prior to the Closing Time (as defined in Section 3(b)) (the DTC Agreement), among the Trust, the Guarantee Trustee and DTC. The entire proceeds from the sale of the Trust Preferred Securities will be combined with the entire proceeds from the sale by the Trust to the Company of its common securities (the Common Securities), and will be used by the Trust to purchase $_____________ of ____% Junior Subordinated Notes due ____________ ___, 20___ (the Junior Subordinated Notes) issued by the Company. The Trust Preferred Securities and the Common Securities will be issued pursuant to the Amended and Restated Trust Agreement, to be dated as of ____________ ___, 200__ (the Trust Agreement), among the Company, as sponsor, ______________________ and ___________________, as administrative trustees (the Administrative Trustees), The Chase Manhattan Bank, as property trustee (the Property Trustee), and Chase Manhattan Bank Delaware, as Delaware trustee (the Delaware Trustee and, together with the Property Trustee and the Administrative Trustees, the Trustees). The Junior Subordinated Notes will be issued pursuant to an indenture, dated as of August, 1, 1995 between the Company and the Trustee as amended by a First Supplemental Indenture dated as of August 1, 1995 and a Second Supplemental Indenture dated as of _____________ ___, 200_ ,(collectively the Indenture) (collectively, the Indenture), between the Company and The Chase Manhattan Bank, as trustee (the Junior Subordinated Note). The Trust and the Company shall enter into an Agreement as to Expenses and Liabilities (the Expenses Agreement) to be dated as of _____________ ___, 200__, pursuant to which the Company shall pay, under certain circumstances, the Obligations (as defined in the Expenses Agreement) of the Trust. The Trust Preferred Securities, the Trust Preferred Securities Guarantee and the Junior Subordinated Notes may be collectively referred to herein as the "Securities." The Indenture, the Trust Agreement and the Trust Preferred Securities Guarantee, the Expenses Agreement, the DTC Agreement and this Agreement may be referred to herein collectively as the "Operative Documents." The Offerors understand that the Underwriters propose to make a public offering of the Trust Preferred Securities (as guaranteed by the Trust Preferred Securities Guarantee) on the terms and in the manner set forth herein and agree that the Underwriters may resell, subject to the conditions set forth herein, all or a portion of the Trust Preferred Securities. SECTION 1. Representations and Warranties. The Offerors jointly and ------------------------------ severally represent and warrant to each Underwriter as of the date hereof and as of the Closing Time, and agree with each Underwriter as follows: (a) A registration statement, No. 333-______ on Form S-3 for the registration of the Securities and certain other securities of the Company 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 the Underwriters, 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 Securities and other securities included in the Registration Statement, which prospectus is now proposed to be supplemented by a supplement relating to the Securities 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). 2 (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 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, at the Closing Time, the Registration Statement and the Prospectus (including any amendments and supplements thereto) will conform in all respects to the requirements of the Securities 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 Section 1(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 Underwriter or on the Underwriter's 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. 3 (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. The Company has no material contingent financial obligation that is not disclosed in each of the Registration Statement and Prospectus. 4 by the Property Trustee and the Delaware Trustee, the Trust Agreement will, at the Closing Time, be a valid and binding obligation of the Company and the Trustees, enforceable against the Company and the Trustees in accordance with its terms, subject to bankruptcy, insolvency, reorganization, moratorium or other similar laws affecting creditor's rights generally or by general principles of equity (whether in a proceeding at law or in equity) and the availability of equitable remedies (collectively, the Bankruptcy Exceptions); will conform in all material respects to the description thereof contained in the Prospectus; and will have been duly qualified under the Trust Indenture Act of 1939, as amended (the 1939 Act). (e) The Trust Preferred Securities Guarantee, the Indenture and the Expenses Agreement have been duly authorized by the Company and, at the Closing Time, will have been duly executed and delivered by the Company, and will constitute valid and binding obligations of the Company, enforceable against the Company in accordance with their terms, subject to the Bankruptcy Exceptions; will conform in all material respects to the description thereof contained in the Prospectus; and at the time the Closing Time, the Trust Preferred Securities Guarantee and the Indenture will have been duly qualified under the 1939 Act. (f) The Junior Subordinated Notes have been duly authorized by the Company and, at the Closing Time, will have been duly executed by the Company and, when authenticated in the manner provided for in the Indenture and delivered against payment therefor as described in the Prospectus, will constitute valid and binding obligations of the Company, enforceable against the Company in accordance with their terms, subject to the Bankruptcy Exceptions; and the Junior Subordinated Notes will be in the forms contemplated by, and entitled to the benefits of, the Indenture and will conform in all material respects to the descriptions thereof in the Prospectus. 5 (g) There are no legal or governmental proceedings pending or, to the knowledge of the Trust or the Company, threatened to which the Trust or the Company is a party or to which any of the properties of the Trust or the Company is subject, other than proceedings accurately described in all material respects in the Prospectus, the effect of which is materially adverse to the condition, financial or otherwise, or in the earnings, business affairs or operations of the Company or on the power or ability of the Trust or the Company to perform its obligations under the Operative Documents or the Securities, as applicable. SECTION 2. Offering The Underwriters have advised the Company that the -------- Underwriters propose to make an offering of the Trust Preferred Securities purchased by the Underwriters for sale on the terms set forth in the Prospectus. SECTION 3. Purchase and Delivery On the basis of the representations and --------------------- warranties contained herein and subject to the terms and conditions herein set forth, the Trust agrees to sell to each Underwriter, severally and not jointly, and each Underwriter, severally and not jointly, agrees to purchase from the Trust, at a price of $_______ per Trust Preferred Security, the number of Trust Preferred Securities set forth in Schedule I opposite the name of such Underwriter, plus any additional Trust Preferred Securities which such Underwriter may become obligated to purchase pursuant to the provisions of Section 8 hereof. (b) Deliveries of certificates for the Trust Preferred Securities shall be made at the offices of the Underwriters in [Location] (or at the offices of [Underwriters' 6 Counsel] specified below in the case of Trust Preferred Securities registered in the name of Cede & Co.), and payment of the purchase price for the Trust Preferred Securities shall be made by the Representative, on behalf of the several Underwriters, to the Trust by wire transfer of immediately available funds contemporaneous with closing at the offices of [Underwriters' Counsel], [Office Address of Underwriters' Counsel], at 10:00 A.M. on ______________ ___, 200__ (unless postponed in accordance with the provisions of Section 8), or such other time not later than ten business days after such date as shall be agreed upon in a writing signed by the Representative and the Offerors (such time and date of payment and delivery being herein called the "Closing Time"). Payment for the Trust Preferred Securities purchased by the Underwriters shall be made to the Trust by wire transfer of immediately available funds, against delivery for the respective accounts of the Underwriters of certificates for the Trust Preferred Securities. Certificates for the Trust Preferred Securities shall be in definitive or global form and in such denominations as the Underwriters may request in writing at least one business day before the Closing Time. It is understood that each Underwriter has authorized the Representative, for its account, to accept delivery of, receipt for, and make payment of the purchase price for, the Trust Preferred Securities which it has agreed to purchase. The certificates representing the Trust Preferred Securities shall be registered in the name of Cede & Co. pursuant to the DTC Agreement and shall be made available for examination by the Underwriters in the City of New York not later than 10:00 A.M. on the last business day prior to the Closing Time. (c) As compensation to the Underwriters for their commitments hereunder and in view of the fact that the proceeds of the sale of the Trust Preferred Securities will be used to purchase Junior Subordinated Notes of the Company (which purchase was arranged by the Underwriters), the Company hereby agrees to pay at the Closing Time to the Representative by wire transfer in immediately available funds, for the accounts of the several Underwriters, $_______ per Capital Security to be delivered by the Company hereunder at the Closing Time. SECTION 4 Conditions to Closing. The several obligations of the --------------------- Underwriters under this Agreement to purchase the Trust Preferred Securities will be subject to the following conditions: (a) Subsequent to the date of this Agreement and prior to the Closing Date, (i) there shall not have occurred any downgrading of the Company's or the Trust's securities by any "nationally recognized statistical rating organization," as such term is defined for purposes of Rule 436(g)(2) under the Securities Act; and (ii) there shall not have occurred any change, the effect of which is materially adverse to the financial condition, earnings or operations of the Company of the Trust. 7 (b) At the Closing Time, the Underwriters shall have received certificates, dated as of the Closing Time and signed by the Chairman of the Board, any Chief Executive Officer, any President or any Executive or Senior Vice President of the Company and an Administrative Trustee of the Trust, to the effect set forth in clause (a) above and to the effect that the representations and warranties of the Company and the Trust, as the case may be, contained in this Agreement are true and correct as of the Closing Time and that each of the Company and the Trust has complied with all of the agreements and satisfied all of the conditions on its part to be performed or satisfied on or before the Closing Time. The officer and Administrative Trustee signing and delivering such certificates may rely upon the best of his or her knowledge as to proceedings threatened. (c) At the Closing Time, the Underwriters shall have received the opinion, dated as of the Closing Time, of McGuire, Woods, Battle & Boothe LLP, counsel for the Offerors, in form and substance satisfactory to counsel for the Underwriters. (d) At the Closing Time, the Underwriters shall have received the opinion, dated as of the Closing Time, of Richards, Layton and Finger, special Delaware counsel to the Offerors, in form and substance satisfactory to counsel for the Underwriters. (e) At the Closing Time, the Underwriters shall have received the favorable opinion, dated as of the Closing Time, of Richards, Layton & Finger, counsel to Chase Manhattan Bank Delaware, as Delaware Trustee under the Trust Agreement, in form and substance satisfactory to counsel for the Underwriters. (f) At the Closing Time, the Underwriters shall have received an opinion, dated as of the Closing Time, of McGuire, Woods, Battle & Boothe LLP, special tax counsel to the Offerors, that (i) the Junior Subordinated Notes will be classified for United States federal income tax purposes as indebtedness of the Company, (ii) the Trust will be classified for United States federal income tax purposes as a grantor trust and not as an association taxable as a corporation and (iii) subject to the qualifications set forth therein, the discussion set forth in the Prospectus under the heading "Certain Federal Income Tax Consequences" represents, in all material respects, a fair and accurate summary of the United States federal income tax consequences of the purchase, ownership and disposition of the Trust Preferred Securities under current law and the opinion contained therein is confirmed as of the date of such opinion. Such opinion may be conditioned on, among other things, the initial and continuing accuracy of the facts, financial and other information, covenants and representations set forth in certificates of officers of the Company and other documents deemed necessary for such opinion. 8 (g) At the Closing Time, the Underwriters shall have received the opinion, dated as of the Closing Time, of [Underwriters' Counsel], counsel for the Underwriters with respect to such matters relating to the offering contemplated hereby as the Underwriters may reasonably request. (h) At the time of execution of this Agreement and at the Closing Time, the Underwriters shall have received a letter or letters, as the case may be, dated as of the date hereof and/or as of the Closing Time, in form and substance satisfactory to the Underwriters, from the Company's independent public accountants, containing statements and information of the type ordinarily included in accountants' SAS 72 "comfort letters" to underwriters with respect to the financial statements and certain financial information contained in or incorporated by reference into the Prospectus. (i) At the Closing Time, the Underwriters shall have received the favorable opinion, dated as of the Closing Time, of Cravath, Swaine & Moore, counsel for the [ ], the Guarantee Trustee and the Property Trustee, in form and substance reasonably satisfactory to counsel for the Underwriters. SECTION 5. Covenants of the Offerors In further consideration of the ------------------------- agreements of the Underwriters contained in this Agreement, the Offerors jointly and severally covenant as follows: (a) The Company, at or prior to the Closing Time, will deliver to the Underwriters 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 Underwriters. (b) Before amending or supplementing the Registration Statement of the Prospectus, to furnish to the Underwriters a copy of each such proposed amendment or supplement and not to use any such proposed amendment or supplement to which the Underwriters reasonably object. (c) If, during the time when a prospectus relating to the Securities is required to be delivered under the Securities Act, any event shall occur 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 Securities Act, the Company promptly will (i) notify the Underwriters to suspend solicitation of purchases of the Securities 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[ and (iii) at its expense, furnish to the Representative a reasonable quantity of the prospectus as so supplemented and amended.] In case any Underwriter is required to deliver a prospectus in connection with the sale of any Securities after the expiration of the period specified in the preceding sentence, the Company, upon the request of the Underwriter, will furnish to the Underwriter, at the expense of such Underwriter, a 9 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 Section (c), 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 Underwriter and [Underwriter's Counsel]. (d) To furnish such proper information as may be lawfully required and otherwise cooperate in qualifying the Trust Preferred Securities for offer and sale under the securities laws of such jurisdictions as the Underwriters 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. (e) Whether or not any sale of such Trust Preferred Securities is consummated, to pay all expenses incident to the performance of its obligations under this Agreement, including: (i) the preparation and filing of the Registration Statement and the Prospectus and all amendments and supplements thereto, (ii) the preparation, issuance and delivery of the Securities, (iii) the reasonable out of pocket fees and disbursements of the Offerors' outside counsel and the reasonable fees and expenses of the Trustees, (iv) the qualification of such Securities under state securities laws in accordance with the provisions of Section 5(d), including filing fees and the fees and disbursements of counsel for the Underwriters in connection therewith and in connection with the preparation of any Blue Sky or legal investment memoranda, (v) the printing and delivery to the Underwriters of reasonable quantities of the Prospectus and any amendments or supplements thereto, (vi) any fees charged by rating agencies for the rating of such Securities, and (vii) the fees and expenses, if any, incurred in connection with the admission of such Securities for trading in any appropriate market system or clearing with any appropriate clearing system. (f) 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 10 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. (g) [The Company will use its best efforts to cause the Trust Preferred Securities to be listed on the New York Stock Exchange, subject to official notice of issuance and 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 Trust Preferred Securities.] SECTION 6. Indemnification and Contribution. The Offerors jointly and -------------------------------- severally, agree to indemnify and hold harmless each Underwriter, their respective directors, officers and each person, if any, who controls such Underwriter within the meaning of either Section 15 of the Securities Act or Section 20 of the Securities Exchange Act, from and against any and all losses, claims, damages and liabilities, and to reimburse each such Underwriter and each such director, officer, employee or controlling person promptly upon demand for any legal or other expenses (including, to the extent hereinafter provided, reasonable out of pocket outside counsel fees) incurred by it or them in connection with investigating or defending or preparing to defend against any such losses, claims, damages or liabilities arising out of or based upon any untrue statement or alleged untrue statement of a material fact contained in the Prospectus (as amended or supplemented if the Company shall have furnished any amendments or supplements thereto), or any omission or alleged omission to state therein a material fact necessary to make the statements therein in light of the circumstances under which they were made not misleading, except insofar as such losses, claims, damages or liabilities arise out of or are based upon any such untrue statement or omission or alleged untrue statement or omission based upon information relating to any Underwriter furnished to the Company in writing by such Underwriter through the Underwriters expressly for use therein; provided, however, that the foregoing indemnity, insofar as it relates to the preliminary prospectus, shall not inure to the benefit of any indemnified person if the person asserting any such loss, claim or damage purchased Trust Preferred Securities from an Underwriter and if a copy of the Prospectus (correcting the preliminary prospectus) was not delivered by the Underwriter or on its behalf to such person at, prior to or promptly following the written confirmation of the sale of the Trust Preferred Securities to such person, unless such failure to deliver the Prospectus was a result of non-compliance by the Company with Section [5(a), (b) or (c)] hereof. (a) The Company agrees to indemnify the Trust against all loss, liability, claim, damage and expense whatsoever, as due from the Trust under Section 6(a). (b) Each Underwriter agrees, severally and not jointly, to indemnify, hold harmless and reimburse the Offerors, their respective directors, officers and each person, if any, who controls either of the Offerors within the meaning of either Section 15 of the Securities Act or Section 20 of the Securities Exchange Act to the same extent as the foregoing indemnity from the Offerors to such Underwriter, but only with reference to information relating to such Underwriter furnished to the Company in writing by such 11 Underwriter through the Underwriters expressly for use in the Prospectus or any amendments or supplements thereto. The indemnity agreement of the respective Underwriters contained in this Section 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 Trust Preferred Securities. (c) In case any proceeding (including any governmental investigation) shall be instituted involving any person in respect of which indemnity may be sought pursuant to either Section 6(a) or 6(c) above, such person (the "indemnified party") shall promptly notify the person against whom such indemnity may be sought (the "indemnifying party") in writing and the indemnifying party, upon request of the indemnified party, 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 retain counsel reasonably satisfactory to the indemnified party to represent the indemnified party and any others the indemnifying party may designate in such proceeding and shall pay the reasonable out of pocket fees and disbursements of such outside counsel related to such proceeding. In any such proceeding, any indemnified party shall have the right to retain its own counsel, but the fees and expenses of such counsel shall be at the expense of such indemnified party unless (i) the indemnifying party and the indemnified party shall have mutually agreed to the retention of such counsel or (ii) the named parties to any such proceeding (including any impleded parties) include both the indemnifying party and the indemnified party and representation of both parties by the same counsel would be inappropriate due to actual or potential differing interests between them. It is understood that the indemnifying party shall not, in connection with any proceeding or related proceedings in the same jurisdiction, be liable for the fees and expenses of more than one separate firm (in addition to any local counsel if necessary, reasonably satisfactory to all parties) for all such indemnified parties and that all such fees and expenses shall be reimbursed as they are incurred. Such firm shall be designated in writing by the Representative in the case of parties indemnified pursuant to Section 6(a) above and by the Company in the case of parties indemnified pursuant to Section 6(c) above. The indemnifying party shall not be liable for any settlement of any litigation, investigation or proceeding effected without its written consent, but if settled with such consent or if there be a final judgment for the plaintiff, the indemnifying party agrees to indemnify the indemnified party from and against any loss, claim damage, expense or liability by reason of such settlement or judgment. Notwithstanding the foregoing sentence, if at any time an indemnified party shall have requested an indemnifying party to reimburse the indemnified party for fees and expenses of counsel as contemplated by the second and third sentences of this paragraph, the indemnifying party agrees that it shall be liable for any settlement of any proceeding effected without its written consent if (i) such settlement is entered into more than 30 days after receipt by such indemnifying party of the aforesaid request and (ii) such indemnifying party shall not have reimbursed the indemnified party in accordance with such request prior to the date of such settlement. No indemnifying party shall, without the prior written consent of the indemnified party, effect any settlement of any pending or threatened proceeding in 12 respect of which any indemnified party is or could have been a party and indemnity could have been sought hereunder by such indemnified party, unless such settlement includes an unconditional release of such indemnified party from all liability on claims that are the subject matter of such proceeding and does not include a statement as to, or an admission of, fault, culpability or a failure to act by or on behalf of any indemnified party. (d) To the extent the indemnification provided for in Section 6(a) or 6(c) is unavailable to an indemnified party or insufficient in respect of any losses, claims, damages or liabilities referred to therein, then each indemnifying party under such paragraph, in lieu of indemnifying such indemnified party thereunder, shall contribute to the amount paid or payable by such indemnified party as a result of such losses, claims, damages or liabilities (i) in such proportion as is appropriate to reflect the relative fault of the Offerors, on the one hand, and of the Underwriters, 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 Offerors on the one hand or by the Underwriters on the other and the parties' relative intent, knowledge, access to information and opportunity to correct or prevent such statement or omission. The parties hereto agree that it would not be just and equitable if contribution pursuant to this Section 6(e) 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 Section 6(e). 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 Section 6(e) 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. SECTION 7. Termination. This Agreement shall be subject to ----------- termination by notice given by the Underwriters to the Company, if (a) after the execution and delivery of this Agreement and prior to the Closing Time, (i) trading generally shall have been suspended or materially limited on or by, as the case may be, any of the New York Stock Exchange, (ii) trading of any securities of the Company shall have been suspended on any exchange or in any over-the-counter market, (iii) a general moratorium on commercial banking activities in New York shall have been declared by either federal or New York State authorities or (iv) there shall have occurred any outbreak or escalation of hostilities or any calamity or crisis that, in which the United States is involved that is material and adverse and (b) in the case of any of the events specified in clauses (a)(i) through (iv), such event singly or together with any other such event makes 13 it, impracticable to market the Trust Preferred Securities on the terms and in the manner contemplated in the Prospectus. SECTION 8. Miscellaneous. If, as of the Closing Time, any one or more ------------- of the Underwriters shall fail or refuse to purchase Trust Preferred Securities that it or they have agreed to purchase hereunder on such date, and the aggregate number of Trust Preferred Securities which such defaulting Underwriter or Underwriters agreed but failed or refused to purchase is not more than one- tenth of the aggregate number of Trust Preferred Securities to be purchased on such date, the other Underwriters shall be obligated severally in the proportions that the number of Trust Preferred Securities set forth opposite their respective names in Schedule I bears to the aggregate number of Trust Preferred Securities set forth opposite the names of all such non-defaulting Underwriters, or in such other proportions as the non-defaulting Underwriters may specify, to purchase the Trust Preferred Securities which such defaulting Underwriter or Underwriters agreed but failed or refused to purchase on such date; provided, however, that in no event shall the number of Trust Preferred Securities that any Underwriter has agreed to purchase pursuant to Section 3 be increased pursuant to this Section 8 by an amount in excess of one-ninth of such number of Trust Preferred Securities without the written consent of such Underwriter. If on the Closing Date, any Underwriter or Underwriters shall fail or refuse to purchase Trust Preferred Securities which it or they have agreed to purchase hereunder on such date and the aggregate number of Trust Preferred Securities with respect to which such default occurs is more than one-tenth of the number of Trust Preferred Securities to be purchased on such date and arrangements satisfactory to the non-defaulting Underwriters and the Company for the purchase of such Trust Preferred Securities are not made within 36 hours after such default, this Agreement shall terminate without liability on the part of any non-defaulting Underwriter or of the Company. In any such case either the Underwriters or the Company shall have the right to postpone the Closing Time, but in no event for longer than seven days, in order that the required changes, if any, in the Prospectus or in any other documents or arrangements may be effected. Any action taken under this paragraph shall not relieve any defaulting Underwriter from liability in respect of any default of such Underwriter under this Agreement. This Agreement may be signed in any number of counterparts, each of which shall be an original, with the same effect as if the signatures thereto and hereto were upon the same instrument. If this Agreement shall be terminated by the Underwriters, or any of them, 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, the Company will reimburse the Underwriters or such Underwriters as have so terminated this Agreement with respect to themselves, severally, for all out-of-pocket expenses (including the fees and disbursements of their counsel) reasonably incurred by such Underwriters in connection with this Agreement or the offering contemplated hereunder; and such termination shall be without liability of any party to any other party except as provided in Section 5(e). 14 Section 7, this Section 8 and all representations, warranties and agreements contained in this Agreement, or in certificates of officers of the Company or trustees of the Trust submitted hereunder, shall remain operative and in full force and effect regardless of (i) any termination of this Agreement; (ii) any investigation made by or on behalf of the Underwriters or any person controlling any Underwriter or by or on behalf of the Trust, the Trustees, the Company, its officers or directors or any other person controlling the Company; and (iii) acceptance of payment for any of the Trust Preferred Securities. This Agreement shall be governed by and construed in accordance with the internal laws of the State of New York. The headings of the sections of this Agreement have been inserted for convenience of reference only and shall not be deemed a part of this Agreement. 15 Please confirm your agreement to the foregoing by signing in the space provided below for that purpose and returning to us a copy hereof, whereupon this Agreement shall constitute a binding agreement between us. Very truly yours, VIRGINIA POWER CAPITAL TRUST II By: VIRGINIA ELECTRIC AND POWER COMPANY, as Depositor By: --------------------------------- Name: Title: VIRGINIA ELECTRIC AND POWER COMPANY By: --------------------------------- Name: Title: Agreed, this ___ day of ___________, 200_ [Underwriter] Acting severally on behalf of itself and the several Underwriters named herein. By [Underwriter] By: --------------------------------- Name: Title: 16 EX-1.IV 5 0005.txt EXHIBIT 1(IV) Exhibit 1(iv) VIRGINIA ELECTRIC AND POWER COMPANY First and Refunding Mortgage Bonds Series _, ____%, Due __________ FORM OF UNDERWRITING AGREEMENT [Date] [Name of Underwriter] as Representative for the Several Underwriters named in Schedule II hereto [Address of Underwriter] 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 First and Refunding Mortgage Bonds (the Mortgage Bonds) specified in Schedule I hereto (the Mortgage Bonds so specified being referred to herein as the Bonds), 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 Bonds. Schedule I specifies the aggregate principal amount of the Bonds, the initial public offering price of the Bonds, 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 Bonds and payment therefor. 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 Bonds. The Bonds will be issued under the Company's Indenture of Mortgage dated November 1, 1935 between the Company and The Chase Manhattan Bank, as Trustee (the Trustee), as supplemented and modified to the date hereof and as to be supplemented by a Supplemental Indenture substantially in the form contained as an exhibit to the Registration Statement referred to below (the Supplemental 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-_______ on Form S-3 for the registration of the Mortgage Bonds under the Securities Act of 1933, as amended (the Securities Act), heretofore filed with the Securities and Exchange Commission (the omission), 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 Mortgage Bonds included in the Registration Statement, which prospectus is now proposed to be supplemented by a supplement relating to the Bonds 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 (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 Section (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 Bonds, 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 Bonds. [(g) The Company has complied and will comply with all of the provisions of Florida H.B. 1771, codified as Section 517.075 of the Florida statutes, and all regulations promulgated thereunder related to issuers of securities doing business with Cuba.] 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 Bonds set forth opposite the name of such Underwriter in Schedule II hereto. The several Underwriters agree to make a public offering of their respective Bonds 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 Bonds 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 Bonds shall be made to the Company [or its order by check or checks in New York Clearing House funds at the Closing Date]. The Bonds shall be in the form of definitive fully registered Bonds without coupons in such authorized denominations and registered in such names as the Representative shall specify in writing not later than 12 Noon, New York time, on the third business day prior to the Closing Date. For the purpose of expediting the checking of such Bond certificates by the Representative, the Company agrees to make the certificates available to the Representative for such purpose not later than 12 Noon, New York time, on the last business day before the Closing Date, at the place specified in Schedule I. 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 and the printing of this Agreement and the Supplemental Indenture, (ii) the preparation, issue and delivery of certificates for the Bonds, (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 Bonds. In addition, the Company will pay the reasonable out of pocket fees and disbursements of Underwriters' counsel, in connection with the qualification of the Bonds 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 Bonds is required to be delivered under the Securities 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 Securities Act, the Company promptly will (i) notify the Representative to suspend solicitation of purchases of the Bonds 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 [and (iii) at its expense, furnish to the Representatives a reasonable quantity of the prospectus as so supplemented or amended]. In case any Underwriter is required to deliver a prospectus in connection with the sale of any Bonds 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 Underwriters' Counsel. (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 [As soon as the Company is advised thereof, it will advise the Representative of the issuance of any stop order under the Securities Act with respect to the Registration Statement or any part thereof, or] 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) 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 Bonds. (g) The Company will furnish such proper information as may be lawfully required and otherwise cooperate in qualifying the Bonds 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. (h) Fees and disbursements Underwriters' outside Counsel (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 Bonds 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 Bonds, a certificate dated the Closing Date and signed by the Chairman of the Board, any Chief Executive Officer, Chief Financial Officer, any President, any Executive Vice President, or Senior 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 Bonds 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 counsel to the Company and Underwriters' Counsel, substantially in the forms attached hereto as Schedules III through V. (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 Mortgage Bonds 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 Bonds 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 Mortgage Bonds 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 Bonds 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 Bonds shall have been satisfactory in form and substance to Underwriters' Counsel. (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 greater than 50% or more of the aggregate principal amount of the Bonds 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 Sections 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 Section 6(g)) 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 Section 6(b) and Section 9. 8. Conditions of the Obligation of the Company. The obligation of the Company to deliver the Bonds shall be subject to the conditions set forth in the first sentence of subparagraph 7(a)(i) and in subparagraph 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), 6(i), 9 and 10(c) 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 Bonds 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 Section 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 Bonds. (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 Section 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 Bonds. (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 outside 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 outside 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 Section 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 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 Section 9(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 Section 9(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 Section 9(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 Section 9(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 Bonds which it or they have agreed to purchase hereunder, and the aggregate principal amount of the Bonds 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 Bonds, the other Underwriters shall be obligated severally in the proportions which the principal amount of the Bonds set forth opposite their respective names in Schedule II bears to the aggregate principal amount of the Bonds, or in such other proportions as the Underwriters may specify, to purchase the Bonds 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 Bonds and the aggregate principal amount of the Bonds with respect to which such default occurs is more than one-tenth of the aggregate principal amount of the Bonds and arrangements satisfactory to the Underwriters and the Company for the purchase of such Bonds 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 Section 6(g) and Section 9) or of the Company (except as provided in Section 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 Bonds. 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 Bonds 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. 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: ___________________________ Title: ___________________________ The foregoing agreement is hereby confirmed and accepted, as of the date first above written. [Name of Underwriter] By:________________________________ Title: Acting individually and on behalf of the other several Underwriters named in Schedule II hereto. SCHEDULE I Title of Bonds: First and Refunding Mortgage Bonds of 199_, Series _, ____ %, due[date] Aggregate Principal Amount: $_____________ Initial Price to Public: % of the principal amount of the Bonds plus accrued interest, if any, from the date of issuance Initial Purchase Price to be paid by Underwriters: _____% of the principal amount of the Bonds. Specified funds for payment of purchase price (N.Y. Clearing House Funds unless otherwise specified). Time of Delivery: [Closing Date and time] Closing Location: The Bonds will be available for inspection by the Representative at: Address for Notices to the Underwriters: SCHEDULE II Principal Amount Underwriter of Bonds to be Purchased SCHEDULE III PROPOSED FORM OF OPINION OF [UNDERWRITER'S COUNSEL Re: VIRGINIA ELECTRIC AND POWER COMPANY First and Refunding Mortgage Bonds of 199_ Series _, ____%, due [date] [Closing Date] [name and address of Representative] Dear Sirs: We have acted as counsel for the several Underwriters described below in connection with arrangements for the issuance by Virginia Electric and Power Company (the Company) of $____________ aggregate principal amount of its First and Refunding Mortgage Bonds of 200_, Series _, ____% due [date] (the Bonds), the terms of which are specified in Schedule I of the Underwriting Agreement referred to below and in the Prospectus referred to therein, under and pursuant to an Indenture of Mortgage of the Company, dated November 1, 1935, as supplemented and modified by eighty-six supplemental indentures (said Indenture of Mortgage as so supplemented and modified being hereinafter called the Mortgage), under which The Chase Manhattan Bank, is now Trustee, and the purchase of the Bonds by the several Underwriters pursuant to the Underwriting Agreement dated [date] between you, acting individually and as Representative of the several Underwriters named in Schedule II thereto, and the Company (the Underwriting Agreement). Unless otherwise defined herein, capitalized terms used 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 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. All legal proceedings taken as of the date hereof in connection with the issuance and sale of the Bonds have been satisfactory in form and substance to us. In addition, we attended the closing held today at 200 Park Avenue, New York, New York, at which the Company delivered to the Representative, for the accounts of the several Underwriters, certificates for the Bonds, in accordance with the Underwriting Agreement, against payment therefor. Based upon the foregoing, and having regard to legal considerations which 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, and constitutes a valid obligation of the Company. C. The Registration Statement 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 Bonds in the manner therein specified. The Registration Statement and the Prospectus (except the financial statements and other financial or statistical information included or 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 the Trust Indenture Act, and to the applicable rules and regulations of the Commission thereunder. We express no opinion with reference to the statements under "Security and Priority" under the caption DESCRIPTION OF THE BONDS in the Prospectus for the reasons indicated in the concluding paragraph of this opinion; but except as aforesaid, and subject to the concluding paragraph of this opinion, we are of the opinion that the statements under DESCRIPTION OF THE BONDS are accurate and do not omit any material fact required to be stated therein or necessary to make such statements not misleading. As to 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 have, however, participated in conferences with counsel for and representatives of the Company in connection with the preparation of the Registration Statement and the Prospectus, and we have reviewed all documents incorporated by reference in the Prospectus through the date hereof pursuant to the requirements of Form S-3 (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 which gives us reason to believe that the Registration Statement or the Prospectus (except the financial statements and other financial or statistical information included or incorporated by reference therein, as to which we express no opinion) contained 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 is made 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. D. An appropriate order of the Virginia Commission with respect to the issue and sale of the Bonds 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 Bonds as contemplated by the Underwriting Agreement. We understand said order does not contain any provision unacceptable to the Representative 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 issue and sale of the Bonds as contemplated by the Underwriting Agreement (except compliance with the provisions of securities or blue sky laws of certain states in connection with the sale of the Bonds in such states) and the carrying out of the provisions of the Underwriting Agreement. E. The Mortgage has been duly authorized by all necessary corporate action and has been duly executed and delivered, and conforms to the statements with respect thereto contained in the Registration Statement and the Prospectus; the Mortgage, so far as it relates to properties in Virginia, North Carolina and West Virginia, subject, as to real properties acquired after the admission of the Eighty-Sixth Supplemental Indenture to recordation, to due and prompt recordation of the Eighty-Sixth Supplemental Indenture in all the recording offices within the jurisdiction of which such properties are located before any sale of any such properties, and subject, as to the mortgaged personal properties in West Virginia, to due and prompt filing of the Eighty-Sixth Supplemental Indenture in the office of the Secretary of State of West Virginia, constitutes a valid mortgage legally effective to create a lien (as to the ranking of which reference is made to the below-mentioned opinions of Messrs. McGuire, Woods, Battle & Boothe and Messrs. Jackson & Kelly, including the statements made in the Prospectus on their authority) for the security of the Bonds (pari passu with all other bonds of the same or other series that are or may hereafter be issued under the Mortgage) upon the interest of the Company in the property, including franchises, now owned by the Company, except as otherwise provided in the Mortgage as to specific property or specific classes of property; the Mortgage contains customary provisions for the enforcement of the security provided for therein, certain of which may be limited by the laws of Virginia, West Virginia or North Carolina (but such laws do not, in our opinion, make inadequate the remedies necessary for the realization of the benefits of such security) and, as to nuclear facilities, by the Atomic Energy Act of 1954, as amended, and regulations thereunder, and may also be limited or rendered unavailable by bankruptcy, moratorium and similar laws from time to time in force or general principles of equity. We express no opinion as to the validity or enforceability of any covenant to pay interest on defaulted interest. The Mortgage has been duly qualified under the Trust Indenture Act. F. The Bonds conform to their description in the Underwriting Agreement and to the statements with respect thereto contained in the Registration Statement and the Prospectus, and have been duly authorized and are duly issued under the Mortgage and entitled to the benefits and security thereof and are valid, binding and legal obligations of the Company according to their tenor and effect (subject, as to enforceability, to bankruptcy, moratorium and similar laws from time to time in force or general principles of equity). We have made no examination of the Company's title to property purported to be owned by it, the description of such property contained in the Mortgage, the validity and sufficiency of the franchises under which the Company operates, the ranking of the lien created by the Mortgage, the absence of liens or encumbrances on property of the Company other than the lien of the Mortgage and the permitted liens referred to therein, the due recordation prior to the date hereof of the original Indenture of Mortgage and the first eighty-_____ supplemental indentures, the form (for purposes of recording) of the Mortgage, or the due filing prior to the date hereof of a financing statement or any other instrument to protect the lien of the Mortgage upon personal property in West Virginia. We express no opinion on such matters and, to the extent that the opinions herein expressed involve such matters, we have relied upon the opinion addressed to you by Messrs. McGuire, Woods, Battle & Boothe of Richmond, Virginia, and Charlotte, North Carolina, and Messrs. Jackson & Kelly of Charleston, West Virginia, each dated the date hereof (including the statements made in the Prospectus on their authority), which opinions are satisfactory in scope and form to us, and upon which opinions we believe you and we may properly rely. Likewise, we have relied upon the opinions of such counsel as to all matters of West Virginia and North Carolina law. Very truly yours, [UNDERWRITER'S COUNSEL] 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 First and Refunding Mortgage Bonds of 199_ Series _, ____%, due [date] [Closing Date] [name and address of Representative] Dear Sirs: We have acted as counsel for Virginia Electric and Power Company (the Company) in connection with arrangements for the issuance by the Company of $____________ aggregate principal amount of its First and Refunding Mortgage Bonds of 200_, Series _, ____%, due [date] (the Bonds) the terms of which are specified in Schedule I of the Underwriting Agreement referred to below and in the Prospectus referred to therein, under and pursuant to an Indenture of Mortgage of the Company, dated November 1, 1935, as supplemented and modified by eighty-six supplemental indentures (such Indenture of Mortgage as so supplemented and modified being hereinafter called the Mortgage), under which The Chase Manhattan Bank is now Trustee, and the purchase of the Bonds by the several Underwriters pursuant to the Underwriting Agreement dated [date] between you, acting individually and as Representative of the several Underwriters named in Schedule II thereto, and the Company (the Underwriting Agreement). Unless otherwise defined herein, capitalized terms used 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 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. 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 the Company 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, and the Company has corporate power to conduct its business and to issue the Bonds. 2. All requisite corporate and governmental authorizations have been given for the issuance of the Bonds and the sale of the Bonds under the Underwriting Agreement. 3. The Mortgage has been duly authorized, executed and delivered and so far as it relates to properties in North Carolina and Virginia is valid and binding except as stated below, and constitutes a valid lien to the extent that it purports to be one for the benefit of the holders of the bonds issued thereunder (except that the lien may be defeated as to real property acquired after recordation of any latest supplemental indenture by its sale before recordation of a further supplemental indenture and our opinion, so far as relating to the lien on certain properties now owned, is accordingly subject to recordation of the Eighty-Sixth Supplemental Indenture and except that the lien as to personal property of the Company held by bailees may be defeated). The Mortgage contains customary provisions for the enforcement of the security provided for therein, certain of which may be limited by the laws of Virginia, West Virginia or North Carolina (but such laws do not, in our opinion, make inadequate the remedies necessary for the realization of the benefits of such security) and, as to nuclear facilities, by the Atomic Energy Act of 1954, as amended, and regulations thereunder, and may also be limited or rendered unavailable by bankruptcy, moratorium and similar laws from time to time in force. We express no opinion as to the validity or enforceability of any covenant to pay interest on defaulted interest. 4. All the Bonds have been duly executed, authenticated and delivered and are valid and binding obligations of the Company, enforceable in accordance with their terms (subject, as to enforceability, to applicable bankruptcy, moratorium and similar laws from time to time in force or general principles of equity). 5. The Underwriting Agreement has been duly authorized, executed and delivered by the Company and is a valid obligation of the Company. 6. The Registration Statement with respect to the Bonds filed pursuant to the Securities Act of 1933, as amended (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 Bonds in the manner therein specified. The statements in regard to our firm made under the caption EXPERTS in the Prospectus 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 properties, limitations upon the issuance of bonds and preferred stock in the Company's Annual Report on Form 10-K incorporated in the Prospectus by reference and the description of the Bonds contained in the Prospectus under DESCRIPTION OF THE BONDS are substantially accurate and fair, including the statements as to North Carolina and Virginia titles and defects therein and franchises and permits. As to the statistical statements in the Registration Statement (which includes the documents incorporated therein by reference), 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, and facilitated the assembly of relevant data. 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 held today at which the Company satisfied the conditions contained in Paragraph 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 and the Prospectus (except the financial statements and the other financial information included or incorporated therein by reference, as to which we express no opinion) comply as to form in all material respects to the requirements of the Securities Act, the Securities Exchange Act and the Trust Indenture Act, and to the applicable rules and regulations of the Commission thereunder. We are further of the opinion that the Mortgage has been duly qualified under the Trust Indenture Act. 7. Except as set forth in the Registration Statement, there are no pending legal, administrative or judicial proceedings with respect to the Company required to be described by Form S-3. The opinions in paragraphs 6 and 7 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. We understand that you are relying (we believe that you are justified in relying, and for our part we rely) on the opinion of Jackson & Kelly as to all matters governed by the laws of West Virginia, including the statements made in the Prospectus on their authority. Yours very truly, MCGUIRE, WOODS, BATTLE & BOOTHE SCHEDULE V PROPOSED FORM OF OPINION OF JACKSON & KELLY 1600 Laidley Tower P. O. Box 553 Charleston, West Virginia 25322 Re: VIRGINIA ELECTRIC AND POWER COMPANY First and Refunding Mortgage Bonds of 199_ Series _, ____%, due [date] [Closing Date] Virginia Electric and Power Company P. O. Box 26666 Richmond, Virginia 23261 [name and address of Representative] Dear Sirs: We are familiar with the arrangements for the issuance of $______________ aggregate principal amount of First and Refunding Mortgage Bonds of 200_, Series _B, ____%, due [date] (the Bonds), of Virginia Electric and Power Company (the Company) under an Indenture of Mortgage dated November 1, 1935, as supplemented and modified by eighty-six supplemental indentures (the Mortgage), and the sale thereof pursuant to an Underwriting Agreement dated [date] between the Company and the Underwriters named in Schedule II thereto (the Underwriting Agreement), and we have acted as West Virginia counsel for the Company in that regard. We are of the opinion that, so far as governed by the laws of West Virginia: 1. The Company is duly qualified as a foreign corporation in West Virginia and has corporate power to conduct its business in West Virginia and issue the Bonds. 2. No governmental authorization is requisite for the issuance of the Bonds and their sale under the Underwriting Agreement. 3. The Mortgage has been duly authorized, executed and delivered, is valid and binding (except as stated below) and so far as it relates to properties in West Virginia constitutes a valid lien to the extent that it purports to be one for the benefit of the holders of the bonds issued thereunder (subject as to mortgaged personal properties, to the filing of the Eighty-Sixth Supplemental Indenture in the office of the Secretary of State of West Virginia and except that the lien may be defeated as to real property acquired after recordation of any latest supplemental indenture and before recordation of a further supplemental indenture and our opinion, so far as relating to the lien on certain properties now owned, is accordingly subject to recordation of the Eighty-Sixth Supplemental Indentures). The Mortgage contains customary provisions for the enforcement of the security provided for therein, certain of which may be limited by the laws of West Virginia (but such laws do not, in our opinion, make inadequate the remedies necessary for the realization of the benefits of such security) and may also be limited or rendered unavailable by bankruptcy, moratorium and similar laws from time to time in force. We express no opinion as to the validity or enforceability of any covenant to pay interest on defaulted interest. We have assumed, for purposes of the opinions herein expressed, that all the Bonds have been duly executed, authenticated and delivered and are valid and binding obligations of the Company, enforceable in accordance with their terms. The statements in regard to our firm made under EXPERTS in the Prospectus relating to the Bonds are correct, and we are of the opinion that the statements in the Prospectus referred to as being made on our authority (including the statements as to West Virginia titles and defects therein and franchises) are substantially accurate and fair. In regard to titles to some of the properties in West Virginia, we have made no independent investigation of original records, but our opinion is based solely on reports and opinions by counsel in whom we have confidence. We assume no responsibility for the accuracy or completeness of any other statements in the Registration Statement, but we do not know of any reason to believe that it contains any untrue statement of a material fact or omits to state a material fact required to be stated or necessary to make the statements not misleading. The foregoing is made on the basis that any statement contained in a document incorporated by reference in the Registration Statement or the Prospectus 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. Very truly yours, [JACKSON & KELLY] EX-4.VI 6 0006.txt FOURTH SUPPLEMENTAL INDENTURE EXHIBIT 4(vi) VIRGINIA ELECTRIC AND POWER COMPANY AND THE CHASE MANHATTAN BANK as Trustee _______________________________ FOURTH SUPPLEMENTAL INDENTURE Dated as of ______, 2000 Supplementing the Senior Indenture dated as of June 1, 1998, as supplemented by a First Supplemental Indenture dated as of June 1, 1998, a Second Supplemental Indenture dated as of June 1, 1999 and a Third Supplemental Indenture dated as of November 1, 1999 _______________________________ 1 THIS FOURTH SUPPLEMENTAL INDENTURE, dated as of ______, 2000 between Virginia Electric and Power Company, a corporation duly organized and existing under the laws of the Commonwealth of Virginia (herein called the "Company"), having its principal office at 701 East Cary Street, Richmond, Virginia 23219- 3932, and The Chase Manhattan Bank, as Trustee, a New York banking corporation having its principal corporate trust office at 450 West 33rd Street, New York, New York 10001 (hereinafter called the "Trustee"). RECITALS The Company and the Trustee are parties to an Indenture, dated as of June 1, 1998, as supplemented by a First Supplemental Indenture dated as of June 1, 1998, a Second Supplemental Indenture dated as of June 1, 1999 and a Third Supplemental Indenture dated as of November 1, 1999 (the "Indenture"), relating to the issuance from time to time by the Company of its unsecured notes or other evidences of indebtedness (the "Securities") on terms to be specified at the time of issuance. Capitalized terms used herein, not otherwise defined, shall have the same meanings given them in the Indenture. The Company has requested the Trustee to join with it in the execution and delivery of this fourth supplemental indenture (the "Fourth Supplemental Indenture") in order to supplement and amend the Indenture, by adding certain provisions thereof, to permit the Company to require, if it shall so elect, that Securities of any series created after the date hereof be subject to repayment, in whole or in part, prior to their Stated Maturity, at the option of Holders thereof. Section 901 of the Indenture provides that a supplemental indenture may be entered into by the Company and the Trustee, without the consent of any Holders of Securities to make any provisions with respect to matters or questions arising under the Indenture, so long as such action does not adversely affect the interests of the Holders of Securities of any series coupons in any material respect. The Company has determined that this Fourth Supplemental Indenture complies with Section 901 and does not require the consent of any Holders of Securities or coupons. At the request of the Trustee, the Company has furnished the Trustee with an Opinion of Counsel complying with the requirements of Section 903 of the Indenture, stating, among other things, that the execution of this Fourth Supplemental Indenture is authorized or permitted by the Indenture, and an Officers' Certificate and Opinion of Counsel complying with the requirements of Section 102 of the Indenture, and has delivered to the Trustee a Board Resolution as required by Section 901 of the Indenture authorizing the execution by the Company of this Fourth Supplemental Indenture and its delivery by the Company to the Trustee. 1 All things necessary to make this Fourth Supplemental Indenture a valid agreement of the Company and the Trustee, in accordance with the terms of the Indenture, and a valid amendment of, and supplement to the Indenture have been done. NOW, THEREFORE, THIS FOURTH SUPPLEMENTAL INDENTURE WITNESSETH: For and in consideration of the premises, it is mutually covenanted and agreed, for the equal and proportionate benefit of all Holders of Securities or coupons, as follows: I. AMENDMENTS TO THE INDENTURE A. Section 101 of the Indenture is amended to add a new definition thereto, in the appropriate alphabetical sequence, as follows: "Repayment Date" shall mean, when used with respect to any -------------- Security to be repaid at the option of the Holder, the date fixed for such repayment by or pursuant to such Security. "Repayment Price" shall mean, when used with respect to any --------------- Security to be repaid at the option of the Holder, the price at which it is to be repaid pursuant to this Indenture. B. Section 113 of the Indenture is hereby deleted and replaced in its entirety as follows: SECTION 113. Legal Holidays. Except as otherwise specified as contemplated by Section 301 with regard to a series of Securities, in any case where any Interest Payment Date, Redemption Date, Repayment Date or Stated Maturity of any Security shall not be a Business Day at any Place of payment, then (notwithstanding any other provision of this Indenture or of the Securities or coupons) payment of interest or principal (and premium, if any) need not be made at such Place of Payment on such date, but may be made on the next succeeding Business Day at such Place of Payment with the same force and effect as if made on the Interest Payment Date, Redemption Date or Repayment Date or at the Stated Maturity, provided that no interest shall accrue on the amount so payable for the period from and after such Interest Payment Date, Redemption Date, Repayment Date or Stated Maturity, as the case may be. C. Article Two of the Indenture is amended and supplemented to add a new Section 206, which reads in its entirety as follows: 2 Section 206. Securities Repayable at the Option of Holders. If the Company shall establish pursuant to Section 301 that the Securities of a particular series offered in a periodic offering are to be repaid before their Stated Maturity at the option of Holders thereof, then the face of such Securities may indicate the applicable Repayment Date(s) and Repayment Price(s), and such Securities may include the following provisions: If so indicated on the face of this Security, the Company may be required to repurchase this Security at the option of the Holder, in whole or in part, on the Repayment Date(s) and at the applicable Repayment Price(s) so indicated on the face hereof, plus accrued interest, if any, to the applicable Repayment Date. On or before the applicable Repayment Date, the Company shall deposit with the Trustee money sufficient to pay the applicable Repayment Price and any interest accrued on the portion of this Security to be tendered for repayment. On and after such Repayment Date, interest will cease to accrue on this Security or any portion hereof tendered for repayment. The repayment option may be exercised by the Holder of this Security for less than the entire principal amount hereof, but in that event, the principal amount hereof remaining outstanding after repayment must be in an authorized denomination. In the event of repurchase of this Security in part only, a new Security or Securities of this series and of like tenor for the unpurchased portion hereof will be issued in the name of the Holder hereof upon the cancellation hereof. In order for this Security to be repaid, the Trustee must receive at least 30 days but not more than 60 days prior to the Repayment Date (i) this Security with the form entitled "Option to Elect Repayment" attached to this Security duly completed or (ii) a facsimile transmission or a letter from a member of a national securities exchange or the National Association of Securities Dealers, Inc. or a commercial bank or trust company in the United States setting forth the name of the Holder of this Security, the principal amount of this Security, the principal amount of this Security to be repaid, the certificate number or a description of the tenor and terms of this Security, a statement that the option to elect repayment is being exercised thereby, and a guarantee that this Security to be repaid, together with the duly completed form entitled "Option to Elect Repayment" attached to this Security, will be received by the Trustee not later than the fifth Business Day after the date of such facsimile transmission or letter; however, such facsimile transmission or letter shall only be effective if this Security and duly completed form are received by the Trustee by such fifth Business Day. Such notice, once given, will be irrevocable unless waived by the Company. 3 Unless otherwise indicated on the face hereof, this Security will not be subject to repayment at the option of the Holder. D. SECTION 902(1) of the Indenture is hereby amended (i) to add the following after the word "redemption" on the third line thereof: "or repayment" and (ii) to add the following after the words "Redemption Date" in the last line thereof: "or, in the case of repayment, on or after the Repayment Date." E. The Indenture is amended and supplemented by adding the following Article Fifteen: ARTICLE FIFTEEN REPAYMENT AT THE OPTION OF HOLDERS Section 1501. Applicability of Article. Repayment of Securities of any series before their Stated Maturity at the option of Holders thereof shall be made in accordance with the terms of such Securities and (except as otherwise specified by the terms of such series established pursuant to Section 301) in accordance with this Article. Section 1502. Repayment of Securities. Securities of any series subject to repayment in whole or in part at the option of the Holders thereof will, unless otherwise provided in the terms of such Securities, be repaid at a price equal to the principal amount thereof, together with interest, if any, thereon accrued to the Repayment Date specified in or pursuant to the terms of such Securities. The Company covenants that on or before the Repayment Date it will deposit with the Trustee or with a Paying Agent (or, if the Company is acting as its own Paying Agent, segregate and hold in trust as provided in Section 1003) an amount of money sufficient to pay the principal (or, if so provided by the terms of the Securities of any series, a percentage of the principal) of, and (except if the Repayment Date shall be an Interest Payment Date) accrued interest on, all the Securities or portions thereof, as the case may be, to be repaid on such date. Section 1503. Exercise of Option. Securities of any series subject to repayment at the option of the Holders thereof will contain an "Option to Elect Repayment" form on such Securities. In order for any Security to be repaid at the option of the Holder, the Trustee must receive at the Place of Payment therefor specified in the terms of such Security (or at such other place or places of which the Company shall from time to time notify the Holders of such Securities) not earlier than 60 days nor later than 30 days prior to the Repayment Date (1) the Security so providing for such repayment together with the "Option to Elect Repayment" form duly completed by the Holder (or by the 4 Holder's attorney duly authorized in writing) or (2) a facsimile transmission or a letter from a member of a national securities exchange, or the National Association of Securities Dealers, Inc. ("NASD"), or a commercial bank or trust company in the United States setting forth the name of the Holder of Security, the principal amount of the Security, the amount of the Security to be repaid, the certificate number or a description of the tenor and terms of the Security, a statement that the option to elect repayment is being exercised thereby and a guarantee that the Security to be repaid, together with the duly completed form entitled "Option to Elect Repayment", will be received by the Trustee not later than the fifth Business Day after the date of such facsimile transmission or letter; provided, however, that such facsimile transmission or letter shall only be effective if such Security and form duly completed are received by the Trustee by such fifth Business Day. If less than the entire principal amount of such Security is to be repaid in accordance with the terms of such Security, the principal amount of such Security to be repaid, in increments of the minimum denomination for Securities of such series, and the denomination or denominations of the Security or Securities to be issued to the Holder for the portion of the principal amount of such Security surrendered that is not to be repaid, must be specified. The principal amount of any Security providing for repayment at the option of the Holder thereof may not be repaid in part if, following such repayment, the unpaid principal amount of such Security would be less than the minimum authorized denomination of Securities of the series of which such Security to be repaid is a part. Except as otherwise may be provided by the terms of any Security providing for repayment at the option of the Holder thereof, exercise of the repayment option by the Holder shall be irrevocable unless waived by the Company. Section 1504. When Securities Presented for Repayment Become Due and Payable. If the Securities of any series providing for repayment at the option of the Holders thereof shall have been surrendered as provided in this Article and as provided by or pursuant to the terms of such Securities, such Securities or the portions thereof, as the case may be, to be repaid shall become due and payable and shall be paid by the Company on the Repayment Date therein specified, and on and after such Repayment Date (unless the Company shall default in the payment of such Securities on such Repayment Date) such Securities so to be repaid shall cease to bear interest. Upon surrender of any such Security for repayment in accordance with such provisions, the principal amount of such Security so to be repaid shall be paid by the Company, together with accrued interest, if any, to the Repayment Date; provided that, installments of interest, if any, whose Stated Maturity is on or prior to the Repayment Date shall be payable (but without interest thereon, unless the Company shall default in the payment thereof) to the Holders of such Securities, or one or more Predecessor Securities, registered as such at the close of business on the relevant Record Dates according to their terms and the provisions of Section 307. If the principal amount of any Security surrendered for repayment shall not be so repaid upon surrender thereof, such principal amount (together with interest, if any, thereon accrued to such Repayment Date) shall, until paid, bear interest from the Repayment Date at the rate of interest set forth in such Security. 5 Section 1505. Securities Repaid in Part. Upon surrender of any Security which is to be repaid in part only (with, if the Company or the Trustee so requires, due endorsement by, or a written instrument of transfer in form satisfactory to the Company and the Security Registrar duly executed by, the Holder thereof or his attorney duly authorized in writing), the Company shall execute and the Trustee shall authenticate and deliver to the Holder of such Security, without service charge and at the expense of the Company, a new Security or Securities of the same series, Stated Maturity and original issue date of any authorized denomination specified by the Holder, in an aggregate principal amount equal to and in exchange for the portion of the principal of such Security so surrendered which is not to be repaid. Section 1506. Compliance with Exchange Act. In connection with any repayment of Securities pursuant to this Article, the Company will comply with the provisions of Rule 13e-4, Rule 14e-1 and any other tender offer rules under the Exchange Act, if required, and will file Schedule 13E-4 or any other schedule, if required. II. GENERAL PROVISIONS A. The recitals contained herein shall be taken as the statements of the Company, and the Trustee assumes no responsibility for the correctness of same. The Trustee makes no representation as to the validity of this Fourth Supplemental Indenture. The Indenture, as supplemented and amended by this Fourth Supplemental Indenture, is in all respects hereby adopted, ratified and confirmed. B. This instrument may be executed in any number of counterparts, each of which so executed shall be deemed to be an original, but all such counterparts shall together constitute but one and the same instrument. C. This Fourth Supplemental Indenture shall be deemed to be a contract under the laws of the State of New York and for all purposes shall be governed by and construed in accordance with the laws of that State. D. Although this Fourth Supplemental Indenture is dated for convenience and for the purpose of reference ______, 2000, the actual dates of execution by the Company and by the Trustee are indicated by their respective acknowledgments hereto annexed. IN WITNESS WHEREOF, VIRGINIA ELECTRIC AND POWER COMPANY and THE CHASE MANHATTAN BANK have caused this Fourth Supplemental Indenture to be duly executed, and their corporate seals to be hereunto affixed and attested all as of the day and year first above written. 6 VIRGINIA ELECTRIC AND POWER COMPANY By:_____________________________________ Name:___________________________________ Title:__________________________________ (SEAL) Attest: _______________________________ [Assistant] Corporate Secretary THE CHASE MANHATTAN BANK, as Trustee By:_____________________________________ Name:___________________________________ Title:__________________________________ (SEAL) Attest: __________________________ Trust Officer 7 State of ____________ City/County of _________________ss.: On the ____ day of ______, 2000, before me personally came _____________ to me known, who, being by me duly sworn, did depose and say that (s)he is __________________ of Virginia Electric and Power Company, one of the corporations described in and which executed the foregoing instrument; that (s)he knows the seal of said corporation; that the seal affixed to said instrument is such corporate seal; that it was so affixed by authority of the Board of Directors of said corporation, and that (s)he signed his/her name thereto by like authority. My commission expires:_______________. IN WITNESS WHEREOF, I have hereunto set my hand and official seal this ____day of __________, 2000. (Notarial Seal) ________________ Notary Public State of ____________ City/County of _________________ss.: On the ____ day of ______, 2000, before me personally came _____________ to me known, who, being by me duly sworn, did depose and say that (s)he is __________________ of The Chase Manhattan Bank, one of the corporations described in and which executed the foregoing instrument; that (s)he knows the seal of said corporation; that the seal affixed to said instrument is such corporate seal; that it was so affixed by authority of the Board of Directors of said corporation, and that (s)he signed his/her name thereto by like authority. My commission expires:_______________. IN WITNESS WHEREOF, I have hereunto set my hand and official seal this ____day of __________, 2000. (Notarial Seal) ________________ Notary Public 1 EX-4.VII 7 0007.txt FIFTH SUPPLEMENTAL INDENTURE Exhibit 4(vii) Form of Supplemental Indenture to Senior Indenture VIRGINIA ELECTRIC AND POWER COMPANY Issuer TO THE CHASE MANHATTAN BANK Trustee ---------------- Fifth Supplemental Indenture Dated as of __________, 200_ Supplementing the Senior Indenture dated as of June 1, 1998, as amended by a First Supplemental Indenture dated as of June 1, 1998, a Second Supplemental Indenture dated as of June 1, 1999, Third Supplemental Indenture dated as of November 1, 1999 and a Fourth Supplemental Indenture dated as of ____, 200_ -------------- $___,000,000 _______Series ___ ____% Senior Debt Securities due __________, 20__ TABLE OF CONTENTS/1/ ARTICLE 1 ____ SERIES __ ___% SENIOR DEBT SECURITIES SECTION 101. Establishment.......................................... SECTION 102. Definitions............................................ SECTION 103. Payment of Principal and Interest...................... SECTION 104. Denominations.......................................... SECTION 105. Global Securities...................................... SECTION 106. Additional Interest.................................... SECTION 107. Listing of Series __ Senior Debt Securities............ SECTION 108. Paying Agent........................................... ARTICLE 2 MISCELLANEOUS PROVISIONS SECTION 201. Recitals by Corporation............................... SECTION 202. Ratification and Incorporation of Original Indenture.. SECTION 203. Executed in Counterparts.............................. SECTION 204. Assignment............................................
_________________________ /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 FIFTH SUPPLEMENTAL INDENTURE is made as of the _______ day of ___________, 200_, by and between VIRGINIA ELECTRIC AND POWER COMPANY, a Virginia corporation, having its principal office at One James River Plaza, 701 East Cary Street, Richmond, Virginia 23219 (the "Company"), 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 Company 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 amended by a First Supplemental Indenture dated as of June 1, 1998, a Second Supplemental Indenture dated as of June 1, 1999, a Third Supplemental Indenture dated as of November 1, 1999, a Fourth Supplemental Indenture dated as of _________, 200_ and by this Fifth 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 Company and the Trustee; WHEREAS, the Company 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 Fifth Supplemental Indenture and to make it a valid and binding obligation of the Company 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 ___ SERIES __ ____% SENIOR DEBT SECURITIES SECTION 101. Establishment. There is hereby established a new series of ------------- Securities to be issued under the Indenture, to be designated as the Company's ___ Series __ ____% Senior Debt Securities, due ____________, 20___ (the "Series ___ Senior Debt Securities"). There are to be authenticated and delivered $___,000,000 principal amount of Series ___ Senior Debt Securities, and no further Series ___ Senior Debt Securities shall be authenticated and delivered except as provided by Sections 304, 305, 306, 904 or 1106 of the Original Indenture. The Series ___ Senior Debt Securities shall be issued in definitive fully registered form without coupons. The Series ___ Senior Debt Securities shall be in substantially the form set out in Exhibit A hereto. The entire principal amount of the Series ___ --------- Senior Debt Securities shall initially be evidenced by one or more certificates issued to Cede & Co., as nominee for The Depository Trust Company. The form of the Trustee's Certificate of Authentication for the Series ___ Senior Debt Securities shall be in substantially the form set forth in Exhibit B --------- hereto. Each Series __ Senior Debt Security 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 __________ and ________ of each year, commencing on _________, 20__. "Original Issue Date" means __________, ____. "Outstanding", when used with respect to the Series ___ Senior Debt Securities, means, as of the date of determination, all Series ___ Senior Debt Securities, theretofore authenticated and delivered under the Indenture, except: (i) Series ___ Senior Debt Securities theretofore canceled by the Trustee or delivered to the Trustee for cancellation; (ii) Series ___ Senior Debt Securities for whose payment the necessary amount of money or money's worth has been theretofore deposited with the Trustee or any Paying Agent (other than the Company) in trust or set aside and segregated in trust by the Company (if the Company shall act as its own Paying Agent) for the Holders of such Series ___ Senior Debt Securities. 2 (iii) Series ___ Senior Debt Securities as to which Defeasance has been effected pursuant to Section 402 of the Original Indenture; and (iv) Series ___ Senior Debt Securities that have been paid pursuant to Section 306 or in exchange for or in lieu of which other Series ___ Senior Debt Securities have been authenticated and delivered pursuant to the Indenture, other than any such Series ___ Senior Debt Securities in respect of which there shall have been presented to the Trustee proof satisfactory to it that such Series ___ Senior Debt Securities are held by a bona fide purchaser in whose hands such Series ___ Senior Debt Securities are valid obligations of the Company; provided, however, that in determining, during any period in which any Series ___ Senior Debt Securities are owned by any Person other than the Company or any Affiliate thereof, whether the Holders of the requisite principal amount of Outstanding Series ___ Senior Debt Securities have given, made or taken any request, demand, authorization, direction, notice, consent, waiver or other action hereunder as of any date, Series ___ Senior Debt Securities owned, whether of record or beneficially, by the Company 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 ___ Senior Debt Securities that the Trustee knows to be so owned by the Company or an Affiliate of the Company in the above circumstances shall be so disregarded. Series ___ Senior Debt Securities 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 ___ Senior Debt Securities and that the pledgee is not the Company or any Affiliate of the Company. "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 ____________, 20___. SECTION 103. Payment of Principal and Interest. The principal of the --------------------------------- Series ___ Senior Debt Securities shall be due at the Stated Maturity. The unpaid principal amount of the Series ___ Senior Debt Securities shall bear interest at the rate of ____% 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 [semi-annually] in arrears on each Interest Payment Date to the Person in whose name the Series ___ Senior Debt Securities are registered on the Regular Record Date for such Interest Payment Date; provided that interest payable at the Stated Maturity of principal 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 ___ Senior Debt Securities 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 ___ Senior Debt Securities not less than ten (10) days prior to such 3 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 ___ Senior Debt Securities 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 ___ Senior Debt Securities will include interest accrued to but excluding the respective Interest Payment Dates. Interest payments for the Series ___ Senior Debt Securities 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 ___ Senior Debt Securities 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), 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 ___ Senior Debt Securities 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 of any Series ___ Senior Debt Securities being made upon surrender of such Series ___ Senior Debt Securities 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 Company, (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 ___ Senior Debt Securities 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), 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 ___ Senior Debt Securities may be ------------- issued in denominations of $1000 or any integral multiple thereof. SECTION 105. Global Securities. The Series ___ Senior Debt Securities ----------------- will be issued initially in the form of one Global Security 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 ___ Senior Debt Securities represented by such Global Security will not be exchangeable for, and will not otherwise be issuable as, Series ___ Senior Debt Securities in definitive form. The Global Security 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. 4 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 __ Senior 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 ___ Senior Debt Securities registered in the names of persons other than the Depositary or its nominee only if (i) the Depositary notifies the Company 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 Company within 90 days of receipt by the Company 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 Company within 90 days after it becomes aware of such cessation, or (ii) the Company 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 ___ Senior Debt Securities registered in such names as the Depositary shall direct. SECTION 106. Redemption. The Series ___ Senior Debt Securities that are ---------- redeemable before their Stated Maturity shall be redeemable in accordance with their terms and in accordance with Article XI of the Original Indenture. The Series ___ Senior Debt Securities shall not have a sinking fund. SECTION 107. Additional Interest. Any principal of and installment of ------------------- interest on the Series ___ Senior Debt Securities that is overdue shall bear interest at the rate of ____% (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. Paying Agent. The Trustee shall initially serve as Paying ------------ Agent with respect to the Series ___ Senior Debt Securities, with the Place of Payment initially being the Corporate Trust Office of the Trustee. ARTICLE 2 MISCELLANEOUS PROVISIONS SECTION 201. Recitals by Company. The recitals in this Fifth ------------------- Supplemental Indenture are made by the Company 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 ___ Senior Debt Securities and of this Fifth Supplemental Indenture as fully and with like effect as if set forth herein in full. 5 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 Fifth 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 Company shall have the right at all times to ---------- assign any of its rights or obligations under the Indenture with respect to the Series ___ Senior Debt Securities to a direct or indirect wholly-owned subsidiary of the Company; provided that, in the event of any such assignment, the Company shall remain primarily liable for the performance of all such obligations. The Indenture may also be assigned by the Company in connection with a transaction described in Article Eight of the Original Indenture. 6 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:_______________________________________ Name:_____________________________________ Title:____________________________________ (SEAL) Attest: _______________________________ Name:__________________________ Vice President and Corporate Secretary THE CHASE MANHATTAN BANK, as Trustee By:_______________________________________ Name:_____________________________________ Title:____________________________________ (SEAL) Attest: _______________________________ Trust Officer 7 Commonwealth of Virginia City of Richmond ss.: On the ____ day of ________, ____, before me personally came _______________ ______________________ to me known, who, being by me duly sworn, did depose and say that (s)he is ________________________ of Virginia Electric and Power Company, one of the corporations described in and which executed the foregoing instrument; that (s)he knows the seal of said corporation; that the seal affixed to said instrument is such corporate seal; that it was so affixed by authority of the Board of Directors of said corporation, and that (s)he signed his/her name thereto by like authority. IN WITNESS WHEREOF, I have hereunto set my hand and official seal this ____day of ________, ____. (Notarial Seal) ______________________________ Notary Public My commission expires: _______________. State of New York City/County of New York ss.: On the ____ day of ________, ____, before me personally came _____________________________________ to me known, who, being by me duly sworn, did depose and say that (s)he is _________________________ of The Chase Manhattan Bank, one of the corporations described in and which executed the foregoing instrument; that (s)he knows the seal of said corporation; that the seal affixed to said instrument is such corporate seal; that it was so affixed by authority of the Board of Directors of said corporation, and that (s)he signed his/her name thereto by like authority. IN WITNESS WHEREOF, I have hereunto set my hand and official seal this ____ day of ________, ____. (Notarial Seal) ______________________________ Notary Public My commission expires: _______________. 8 EXHIBIT A FORM OF ____ SERIES B ____% SENIOR DEBT SECURITY, DUE ____________, 20___ [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 ____________________ $_____________ ____ SERIES B ____% SENIOR DEBT SECURITY, DUE ____________, 20___ No. ___ CUSIP No. ____ Virginia Electric and Power Company, a corporation duly organized and existing under the laws of Virginia (herein called the "Company", which term includes any successor Person under the Indenture hereinafter referred to), for value received, hereby promises to pay to [Cede & Co.]**, or registered assigns (the "Holder"), the principal sum of __________________ Dollars ($______________) on ____________, 20___, and to pay interest thereon from _____________________ **Insert in Global Securities. ________ 1, ____ or from the most recent Interest Payment Date to which interest has been paid or duly provided for, [semi-annually] on ______________ and __________ in each year, commencing ________, 200_, at the rate of ____% per annum, until the principal hereof is paid or made available for payment, provided that any principal, and any such installment of interest, that is overdue shall bear interest at the rate of ____% 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) 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 any such interest on this Security will be made at the office of the Paying Agent or agency of the Company in the Borough of Manhattan, City and State of New York, 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. 2 IN WITNESS WHEREOF, the Company has caused this instrument to be duly executed under its corporate seal. Dated: 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 amended by a First Supplemental Indenture dated as of June 30, 1998, a Second Supplemental Indenture dated as of June 1, 1999, a Third Supplemental Indenture dated as of November 1, 1999, a Fourth Supplemental Indenture dated as of ______ __, 200_ and and by a Fifth Supplemental Indenture dated as of ___________,200_ (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 $___,000,000. [The Securities of this series are not subject to redemption prior to Stated Maturity.] 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 3 Securities of each series at the time Outstanding, on behalf of the Holders of all Securities of such series, to waive 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 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 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 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 $________ 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 Security or Securities to be exchanged at the office or agency of the Company. 4 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. 5 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 Company, 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. 7 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-4.VIII 8 0008.txt SECOND SUPPLEMENTAL INDENTURE Exhibit 4(viii) Form of Second Supplemental Indenture SECOND SUPPLEMENTAL INDENTURE BETWEEN VIRGINIA ELECTRIC AND POWER COMPANY AND THE CHASE MANHATTAN BANK DATED AS OF ____________, 200_ ____% JUNIOR SUBORDINATED NOTES, DUE __________, 20__ TABLE OF CONTENTS
ARTICLE I DEFINITIONS........................................................ 2 1.1 Definition of Terms.................................................... 2 ARTICLE II GENERAL TERMS AND CONDITIONS OF THE JUNIOR SUBORDINATED NOTES..... 5 2.1 Designation and Principal Amount....................................... 5 2.2 Stated Maturity........................................................ 5 2.3 Form and Payment; Minimum Transfer Restriction......................... 5 2.4 Exchange and Registration of Transfer of Junior Subordinated Notes; Restrictions on Transfers; Depositary.................................. 6 2.5 Interest............................................................... 7 ARTICLE III PREPAYMENT OF THE JUNIOR SUBORDINATED NOTES................... .. 8 3.1 Tax Event or Investment Company Event Prepayment....................... 8 3.2 Optional Prepayment by Company......................................... 8 3.3 Notice of Prepayment................................................... 9 ARTICLE IV EXTENSION OF INTEREST PAYMENT PERIOD.............................. 9 4.1 Extension of Interest Payment Period................................... 9 4.2 Notice of Extension.................................................... 10 4.3 Direct Action.......................................................... 11 ARTICLE V EXPENSES........................................................... 11 5.1 Payment of Expenses.................................................... 11 5.2 Payment Upon Resignation or Removal.................................... 12 ARTICLE VI FORM OF JUNIOR SUBORDINATED JUNIOR SUBORDINATED NOTE.............. 12 6.1 Form of Junior Subordinated Junior Subordinated Note................... 12 ARTICLE VII ORIGINAL ISSUE OF JUNIOR SUBORDINATED NOTES...................... 12 7.1 Original issue of Junior Subordinated Notes............................ 12 ARTICLE VIII MISCELLANEOUS................................................... 12 8.1 Ratification of Indenture; Second Supplemental Indenture Controls...... 12 8.2 Trustee Not Responsible for Recitals................................... 13 8.3 Governing Law.......................................................... 13 8.4 Separability........................................................... 13 8.5 Counterparts........................................................... 13
Exhibit A - Form of Junior Subordinated Junior Subordinated Note SECOND SUPPLEMENTAL INDENTURE SECOND SUPPLEMENTAL INDENTURE, dated as of ____________, 200_ (the "Second Supplemental Indenture"), between VIRGINIA ELECTRIC AND POWER COMPANY, a Virginia corporation (the "Company"), and THE CHASE MANHATTAN BANK, as trustee (the "Trustee") under the Indenture dated as of August, 1, 1995 between the Company and the Trustee (the "Base Indenture" and, together with the First Supplemental Indenture dated as of August 1, 1995 and this Second Supplemental Indenture, the "Indenture"). WHEREAS, the Company executed and delivered the Base Indenture to the Trustee to provide for the future issuance of the Company's unsecured junior subordinated notes (the "Junior Notes") to be issued from time to time in one or more series as might be determined by the Company under the Indenture, in an unlimited aggregate principal amount which may be authenticated and delivered as provided in the Base Indenture; WHEREAS, pursuant to the terms of the Base Indenture, the Company desires to provide for the establishment of a series of its Junior Subordinated Notes, to be known as its ____% Junior Subordinated Notes due __________, 20__ (the "Junior Subordinated Notes"), the form and substance of such Junior Subordinated Notes and the terms, provisions and conditions thereof to be set forth as provided in the Base Indenture and this Second Supplemental Indenture; WHEREAS, the Company desires that this series of Junior Subordinated Notes be originally issued on __________, ____ pursuant to the Indenture [and the Trust Agreement (as defined in Section 1.1)]; [WHEREAS, Virginia Power Capital Trust II, a Delaware statutory business trust (the "Trust"), has offered to the purchasers (the "Underwriters") named in Schedule I to the Underwriting Agreement (the "Underwriting Agreement") dated __________, 200_ among the Underwriters, the Trust and the Company $___________ aggregate liquidation amount of its ____% Trust Preferred Securities (the "Trust Preferred Securities"), representing undivided beneficial interests in the assets of the Trust and proposes to invest the proceeds from the sale of the Trust Preferred Securities, together with the proceeds of the sale by the Trust to the Company of $_________ aggregate liquidation amount of its Common Securities, in $___________ aggregate principal amount of the Junior Subordinated Notes;] and WHEREAS, the Company has requested that the Trustee execute and deliver this Second Supplemental Indenture and all requirements necessary to make this Second Supplemental Indenture a valid instrument in accordance with its terms, and to make the Junior Subordinated Notes, when executed by the Company and authenticated and delivered by the Trustee, the valid obligations of the Company, have been performed, and the execution and delivery of this Second Supplemental Indenture has been duly authorized in all respects; NOW, THEREFORE, in consideration of the purchase and acceptance of the Junior Subordinated Notes by the Underwriters, and for the purpose of setting forth, as provided in the Base Indenture, the form and substance of the Junior Subordinated Notes and the terms, provisions and conditions thereof, the Company covenants and agrees with the Trustee as follows: ARTICLE I DEFINITIONS 1.1 Definition of Terms. For all purposes of this Second Supplemental Indenture, except as otherwise expressly provided or unless the context otherwise requires: (a) the terms which are defined in the Base Indenture have the same meanings when used in this Second Supplemental Indenture unless otherwise defined herein; (b) the terms defined in this Article have the meanings assigned to them in this Article and include the plural as well as the singular; (c) all other terms used herein which are defined in the Trust Indenture Act of 1939, whether directly or by reference therein, have the meanings assigned to them therein; (d) all accounting terms not otherwise defined herein have the meanings assigned to them in accordance with generally accepted accounting principles in the United States of America, and, except as otherwise herein expressly provided, the term "generally accepted accounting principles" with respect to any computation required or permitted hereunder shall mean such accounting principles as are generally accepted in the United States of America at the date of such computation; provided, that when two or more principles are so generally accepted, it shall mean that set of principles consistent with those in use by the Company; (e) a reference to a Section or Article is to a Section or Article of this Second Supplemental Indenture unless otherwise stated; (f) the words "herein," "hereof" and "hereunder" and other words of similar import refer to this Second Supplemental Indenture as a whole and not to any particular Article, Section or other subdivision; (g) headings are for convenience of reference only and do not affect interpretation; (h) the term "prepayment" as used herein means "redemption" as such term is used in the Base Indenture; and (i) [the following terms have the meanings given to them in the Trust Agreement: (i) Administrative Trustee, (ii) Delaware Trustee, (iii) Distributions, (iv) Property Trustee, (v) Trust Preferred Securities, (vi) Tax Event and (vii) Investment Company Event.] "Additional Interest" has the meaning specified in Section 2.5. -2- ["Adjusted Treasury Rate" means, with respect to any prepayment date, the Treasury Rate plus (i) [1.00]% if such prepayment date occurs on or before __________, 20__ or (ii) [0.50]% if such prepayment date occurs after __________, 20__.] ["Comparable Treasury Issue" means with respect to any prepayment date the United States Treasury security selected by the Quotation Agent as having a maturity comparable to the Term To Initial Optional Prepayment Date that would be utilized, at the time of selection and in accordance with customary financial practice, in pricing new issues of corporate debt securities of comparable maturity to the Term To Initial Optional Prepayment Date. If no United States Treasury security has a maturity which is within a period from three months before to three months after __________, 20__, the two most closely corresponding United States Treasury securities shall be used as the Comparable Treasury Issue, and the Treasury Rate shall be interpolated or extrapolated on a straight-line basis, rounding to the nearest month using such securities.] ["Comparable Treasury Price" means, with respect to any prepayment date, (A) the average of five Reference Treasury Dealer Quotations for such prepayment date, after excluding the highest and lowest such Reference Treasury Dealer Quotations, or (B) if the Trustee obtains fewer than three such Reference Treasury Dealer Quotations, the average of all such Quotations.] "Coupon Rate" has the meaning specified in Section 2.5(a). "Definitive Junior Subordinated Note Certificates" means Junior Subordinated Notes issued in definitive, fully registered form. ["Event Prepayment Price" has the meaning specified in Section 3.1.] "Extension Period" has the meaning specified in Section 4.1. "Global Security" has the meaning specified in Section 2.4(a). ["Initial Optional Prepayment Date" has the meaning specified in Section 3.2(a).] "Interest Payment Date" has the meaning specified in Section 2.5. "Junior Notes" has the meaning specified in the first recital to this Second Supplemental Indenture. "Junior Subordinated Notes" has the meaning specified in the second recital to this Second Supplemental Indenture. ["Liquidation Amount" means the stated amount of $_____ per Capital Security.] ["Optional Prepayment Price" has the meaning specified in Section 3.2.] "Quotation Agent" means _____________________ and its successors. -3- "Record Date" has the meaning specified in Section 2.5(a). ["Reference Treasury Dealer" means (i) ___________________ , and their respective successors; provided, however, that if any of the foregoing shall cease to be a primary U.S. Government securities dealer in New York City (a "Primary Treasury Dealer"), the Company shall substitute therefor another Primary Treasury Dealer; and (ii) any other Primary Treasury Dealer selected by the Trustee after consultation with the Company.] ["Reference Treasury Dealer Quotations" means, with respect to each Reference Treasury Dealer and any prepayment date, the average, as determined by the Trustee, of the bid and asked prices for the Comparable Treasury Issue (expressed in each case as a percentage of its principal amount) quoted in writing to the Trustee by such Reference Treasury Dealer at 5:00 p.m. on the third Business Day preceding such prepayment date.] ["Term To Initial Optional Prepayment Date" has the meaning specified in Section 3.1.] "Treasury Rate" means (i) the yield, under the heading which represents the average for the immediately preceding week, appearing in the most recently published statistical release designated "H.15 (519)" or any successor publication which is published weekly by the Federal Reserve and which establishes yields on actively traded United States Treasury securities adjusted to constant maturity under the caption "Treasury Constant Maturities," for the maturity corresponding to the Term To Initial Optional Prepayment Date (if no maturity is within three months before or after the Term To Initial Optional Prepayment Date, yields for the two published maturities most closely corresponding to the Term To Initial Optional Prepayment Date shall be determined and the Treasury Rate shall be interpolated or extrapolated from such yields on a straight-line basis, rounding to the nearest month) or (ii) if such release (or any successor release) is not published during the week preceding the calculation date or does not contain such yields, the rate per annum equal to the semi-annual equivalent yield to maturity of the Comparable Treasury Issue, calculated using a price for the Comparable Treasury Issue (expressed as a percentage of its principal amount) equal to the Comparable Treasury Price for such prepayment date. The Treasury Rate shall be calculated on the third Business Day preceding the prepayment date. "Trust Preferred Securities" has the meaning specified in the fourth recital to this Second Supplemental Indenture. ["Trust" has the meaning specified in the fourth recital to this Second Supplemental Indenture.] ["Trust Agreement" means the Amended and Restated Trust Agreement dated as of __________, 200_ among the Company, as Depositor, The Chase Manhattan Bank, as Property Trustee, Chase Manhattan Bank Delaware, as Delaware Trustee, the Administrative Trustees named therein and the holders, from time to time, of undivided beneficial interests in the assets of the Trust.] -4- ["Underwriters" has the meaning specified in the fourth recital to this Second Supplemental Indenture.] ["Underwriting Agreement" has the meaning specified in the fourth recital to this Second Supplemental Indenture.] ARTICLE II GENERAL TERMS AND CONDITIONS OF THE JUNIOR SUBORDINATED NOTES 2.1 Designation and Principal Amount. There is hereby authorized one series of Junior Subordinated Notes, to be designated the "____% Junior Subordinated Notes due __________, 20__," and limited in aggregate principal amount to $___________, which amount shall be as set forth in any written orders of the Company for the authentication and delivery of Junior Subordinated Notes pursuant to Section 302 of the Base Indenture and Section 7.1(a) hereof. 2.2 Stated Maturity. The Stated Maturity of the Junior Subordinated Notes is __________, 20__, which may not be shortened or extended. 2.3 Form and Payment; Minimum Transfer Restriction. (a) The Junior Subordinated Notes shall be issued to the [holders] [Property Trustee] in fully registered definitive form without coupons in minimum denominations of $1,000 and integral multiples of $1,000 in excess thereof. Principal and interest on the Junior Subordinated Notes issued in definitive form will be payable, the transfer of such Junior Subordinated Notes will be registerable and such Junior Subordinated Notes will be exchangeable for Junior Subordinated Notes bearing identical terms and provisions at the Corporate Trust Office of the Trustee; provided, however, that payment of interest may be made at the option of the Company by check mailed to the registered holder at such address as shall appear in the Security Register. [Notwithstanding the foregoing, so long as the registered holder of any Junior Subordinated Notes is the Property Trustee, the payment of the principal of and interest (including Additional interest if any, and additional amounts referred to in clause (i) of the definition of "Additional Interest" contained in Section 101 of the Bank Indenture, if any, on such Junior Subordinated Notes held by the Property Trustee will be made at such place, or by wire transfer of immediately available funds to such account, as may be designated by the Property Trustee.] The Security Register for the Junior Subordinated Notes shall be kept at the Corporate Trust Office of the Trustee and the Trustee is hereby appointed registrar for the Junior Subordinated Notes. (b) The Junior Subordinated Notes may be transferred or exchanged only in minimum denominations of $[1,000] and integral multiples of $[1,000] in excess thereof, and any attempted transfer, sale or other disposition of Junior Subordinated Notes in a denomination of less than $[1,000] shall be deemed to be void and of no legal effect whatsoever. Any such transferee shall be deemed not to be the holder of such Junior Subordinated Notes for any purpose, including but not limited to the receipt of payments in respect of such Junior -5- Subordinated Notes and such transferee shall be deemed to have no interest whatsoever in such Junior Subordinated Notes. 2.4 Exchange and Registration of Transfer of Junior Subordinated Notes; Restrictions on Transfers; Depositary. [If distributed to holders of Trust Preferred Securities pursuant to Section 8.2 of the Trust Agreement, the Junior Subordinated Notes will be issued to such holders in the same form as the Trust Preferred Securities that such Junior Subordinated Notes replace in accordance with the following procedures:] (a) So long as Junior Subordinated Notes are eligible for book-entry settlement with the Depositary, or unless required by law, all Junior Subordinated Notes that are so eligible will be represented by one or more Junior Subordinated Notes in global form (a "Global Security") registered in the name of the Depositary or the nominee of the Depositary. Except as provided in Section 2.4(c) below, beneficial owners of a Global Security shall not be entitled to have Definitive Certificates registered in their names, will not receive or be entitled to receive physical delivery of Definitive [Junior Subordinated Note] Certificates and will not be registered holders of such Global Security. (b) The transfer and exchange of beneficial interests in Global Security shall be effected through the Depositary in accordance with the Indenture and the procedures and standing instructions of the Depositary and the Trustee shall make appropriate endorsements to reflect increases or decreases in principal amounts of such Global Security. (c) Notwithstanding any other provisions of the Indenture (other than the provisions set forth in this Section 2.4(c)), a Global Security may not be exchanged in whole or in part for Junior Subordinated Notes registered, and no transfer of a Global Security may be registered, in the name of any person other than the Depositary or a nominee thereof unless (i) such Depositary (A) has notified the Company that it is unwilling or unable to continue as Depositary for such Global Security or (B) has ceased to be a clearing agency registered as such under the Exchange Act and no successor Depositary has been appointed by the Company within 90 days after its receipt of such notice or its becoming aware of such ineligibility, (ii) there shall have occurred and be continuing an Event of Default, or any event which after notice or lapse of time or both would be an Event of Default under the Indenture, with respect to such [Junior Subordinated Note], or (iii) the Company, in its sole discretion, instructs the Trustee to exchange such Global Security for a Junior Subordinated Note that is not a Global Security (in which case such exchange shall be effected by the Trustee). The Depositary shall be a clearing agency registered under the Exchange Act. The Company initially appoints The Depository Trust Company to act as Depositary with respect to the Global Securities. Initially, any Global Securities shall be registered in the name of Cede & Co., as the nominee of the Depositary, and deposited with the Trustee as custodian for Cede & Co. Definitive Junior Subordinated Notes issued in exchange for all or a part of a Global Security pursuant to this Section 2.4(c) shall be registered in such names and in such authorized denominations as the Depositary, pursuant to instructions from its direct or indirect participants or otherwise, shall instruct the Trustee. Upon execution and authentication, the -6- Trustee shall deliver such definitive Junior Subordinated Notes to the Person in whose names such definitive Junior Subordinated Notes are so registered. So long as Junior Subordinated Notes are represented by one or more Global Securities, (i) the registrar for the Junior Subordinated Notes and the Trustee shall be entitled to deal with the clearing agency for all purposes of the Indenture relating to such Global Securities as the sole holder of the Junior Subordinated Notes evidenced by such Global Securities and shall have no obligations to the holders of beneficial interests in such Global Securities; and (ii) the rights of the holders of beneficial interests in such Global Securities shall be exercised only through the clearing agency and shall be limited to those established by law and agreements between such holders and the clearing agency and/or the participants in the clearing agency. At such time as all interests in a Global Security have been redeemed, exchanged, repurchased or canceled, such Global Security shall be, upon receipt thereof, canceled by the Trustee in accordance with standing procedures and instructions of the Depositary. At any time prior to such cancellation, if any interest in a Global Security is exchanged for definitive Junior Subordinated Notes, prepaid by the Company pursuant to Article 3 or canceled, or transferred for part of a Global Security, the principal amount of such Global Security shall, in accordance with the standing procedures and instructions of the Depositary be reduced or increased, as the case may be, and an endorsement shall be made on such Global Security by, or at the direction of, the Trustee to reflect such reduction or increase. 2.5 Interest. (a) Each Junior Subordinated Note will bear interest at the rate of ____% per annum (the "Coupon Rate") from __________, ____ until the principal thereof becomes due and payable, and will bear interest on any overdue principal at the Coupon Rate and (to the extent that payment of such interest is enforceable under applicable law) on any overdue installment of interest at the Coupon Rate ("Additional Interest"), compounded semiannually, payable (subject to the provisions of Article 4) semiannually in arrears on the 1st day of [December] and [June] of each year (each, an "Interest Payment Date"), commencing on _________, ____ to the Person in whose name such Junior Subordinated Note is registered, subject to certain exceptions, at the close of business on the Record Date next preceding such Interest Payment Date. The "Record Date" for payment of interest will be the Business Day next preceding the Interest Payment Date, unless such Junior Subordinated Note is registered to a holder other than the Property Trustee or a nominee of the Depositary, in which case the Record Date for payment of interest will be the fifteenth day of the calendar month next preceding the applicable Interest Payment Date or, if such fifteenth day of the month is not a Business Day, then the Business Day next preceding such day. [Until liquidation, if any, of the Trust, each Junior Subordinated Note will be held in the name of the Property Trustee in trust for the benefit of the holders of the Trust Preferred Securities.] (b) The amount of interest payable for any period will be computed 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 Junior Subordinated 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 other payment in respect of any such delay), except that, if such Business -7- Day is in the next succeeding calendar year, such payment shall be made on the next preceding day which is a Business Day, with the same force and effect as if made on such payment date. (c) [The Company will also pay Additional Interest as additional distributions on the Junior Subordinated Notes in the following circumstances. So long as no Event of Default has occurred and is continuing, in the event that (i) a Tax Event in respect of the Trust shall have occurred and be continuing and (ii) the Company shall not have (a) redeemed or prepaid the Junior Subordinated Notes or (b) terminated the Trust pursuant to the termination provisions of the Trust Agreement, the Company shall pay to the Trust (and any permitted successor or assign under the Trust Agreement) for so long as the Trust (or its permitted successor or assignee) is the registered holder of any Junior Subordinated Notes. The deferral of the payment of interest pursuant to Article IV shall not defer the payment of any Additional Interest that may be then due and payable.] ARTICLE III PREPAYMENT OF THE JUNIOR SUBORDINATED NOTES 3.1 Tax Event or Investment Company Event Prepayment. If a Tax Event or Investment Company Event shall occur and be continuing, the Company may, at its option, prior to the Initial Optional Prepayment Date (as defined herein) notwithstanding Section 3.2(a) but subject to Section 3.2(b), prepay the Junior Subordinated Notes in whole (but not in part) within 90 days of the occurrence of such Tax Event or Investment Company Event at a prepayment price (the "Event Prepayment Price") equal to the greater of (i) 100% of the principal amount of such Junior Subordinated Notes or (ii) as determined by the Quotation Agent, an amount equal to the sum of the present values of the Optional Prepayment Price (as defined below) that would be payable on the Initial Optional Prepayment Date together with the present values of scheduled payments of interest from the prepayment date to the Initial Optional Prepayment Date (such period, the "Term To Initial Optional Prepayment Date"), in each case, discounted to the prepayment date on a semi-annual basis (consisting of a 360-day year of twelve 30-day months) at the Adjusted Treasury Rate, plus, in each case, accrued interest thereon to but excluding the prepayment date. The Company shall give the Trustee notice of the amount of the Event Prepayment Price promptly after the calculation thereof. 3.2 Optional Prepayment by Company. (a) Subject to the provisions of this Article Three, the Company shall have the right to prepay the Junior Subordinated Notes, in whole or in part, at any time on or after ________, 20__ (the "Initial Optional Prepayment Date"), at the optional prepayment prices set forth below (expressed as percentages of outstanding principal amount of the Junior Subordinated Notes to be prepaid), plus, in each case, accrued and unpaid interest thereon to the applicable date of prepayment (the "Optional Prepayment Price") if prepaid during the 12-month period beginning on __________ of the years indicated below. Year Percentage ---- ---------- 20__................... 10_.___% 20__................... 10_.___% 20__................... 10_.___% 20__................... 10_.___% 20__................... 10_.___% 20__................... 10_.___% 20__................... 10_.___% 20__................... 10_.___% -8- 20__................... 10_.___% 20__................... 10_.___% 20__ and thereafter.... 100.000% If the Junior Subordinated Notes are only partially prepaid pursuant to this Section 3.2, the Junior Subordinated Notes will be prepaid pro rata or by --- ---- lot or by any other method utilized by the Trustee. The Optional Prepayment Price shall be paid prior to 2:00 p.m., New York City time, on the date of such prepayment, provided that the Company shall deposit with the Trustee an amount sufficient to pay the Optional Prepayment Price by 11:00 a.m., New York City time, on the date such Optional Prepayment Price is to be paid. (b) Notwithstanding the first sentence of Section 3.2, in the event that a Tax Event or an Investment Company Event shall have occurred and be continuing, the Junior Subordinated Notes thereafter will be subject to optional prepayment, in whole only, but not in part, on or after the Initial Optional Prepayment Date, at the optional prepayment prices set forth in this Section 3.2 and otherwise in accordance with this Article III. 3.3 Notice of Prepayment. Subject to Article Eleven of the Base Indenture, notice of any prepayment pursuant to this Article Three will be mailed at least 30 days but not more than 60 days before the prepayment date to each holder of Junior Subordinated Notes to be prepaid at such holder's registered address. Unless the Company defaults in payment of the Event Prepayment Price, on and after the prepayment date interest shall cease to accrue on such Junior Subordinated Notes called for prepayment. Notwithstanding Section 1104 of the Base Indenture, any notice of a prepayment pursuant to Section 3.1 need not set forth the Redemption Price but only the manner of calculation thereof. Any prepayment under this Article III shall be treated as a redemption for all purposes of the Base Indenture.] ARTICLE IV EXTENSION OF INTEREST PAYMENT PERIOD 4.1 Extension of Interest Payment Period. So long as no Event of Default under Section 501 of the Base Indenture has occurred and is continuing, the Company shall have the right, at any time during the term of the Junior Subordinated Notes, from time to time to defer the payment of interest by extending the interest payment period of such Junior Subordinated Notes for a period up to 20 consecutive quarters (an "Extension Period"), during which Extension Period the Company shall have the right to make partial payments of interest on any Interest Payment Date. No Extension Period shall end on a date other than an Interest Payment Date or extend beyond the Stated Maturity of the Junior Subordinated Notes. To the extent permitted by applicable law, interest, the payment of which has been deferred because of an Extension Period imposed pursuant to this Section 4.1, will bear Additional Interest compounded [quarterly]. At the end of the Extension Period, the Company shall pay all interest then accrued and unpaid on the Junior Subordinated Notes, including any Additional Interest and Additional Tax Sums, if applicable, to the holders of the Junior Subordinated Notes in whose names the Junior Subordinated Notes are registered in the Security Register on the first Regular Record Date preceding the end of the Extension Period. Before the termination of any Extension Period, the Company may further extend such Extension Period, provided that such period -9- together with all such further extensions thereof shall not exceed 20 consecutive quarters, or extend beyond the Stated Maturity. At any time following the termination of any Extension Period and upon the payment of any accrued and unpaid Additional Interest and Additional Tax Sums, if applicable, then due, the Company may elect to begin a new Extension Period, subject to the foregoing requirements. No interest shall be due and payable during an Extension Period, except at the end thereof. During any such Extension Period, the Company shall not (i) declare or pay any dividends or distributions on, or redeem, purchase, acquire or make a liquidation payment with respect to, any of the Company's [Capital Stock] or (ii) make any payment of principal of or interest on or repay, repurchase or redeem any debt securities of the Company that rank on a parity with or junior to this Junior Subordinated Note or make any guarantee payments with respect to any guarantee by the Company of the debt securities of any subsidiary of the Company that by its terms ranks on a parity with or junior to this Junior Subordinated Note (other than (a) dividends or distributions in common capital stock, (b) any declaration of a dividend in connection with the implementation of a Rights Plan, the issuance of any [Capital Stock] or any class or series of preferred stock of the Company under any shareholder's rights plan or the redemption or repurchase of any rights distributed pursuant to a shareholder's rights plan and (c) purchases of Common Stock related to the issuance of Common Stock or rights under any of the Company's benefit plans for its directors, officers, employees, consultants or advisors). 4.2 Notice of Extension. (a) [If the Property Trustee is the only registered holder of the Junior Subordinated Notes at the time the Company elects to begin or extend an Extension Period, the Company shall give written notice to the Property Trustee, the Administrative Trustees and the Trustee of its election to begin or extend any Extension Period at least five Business Days prior to the earlier of (i) the next succeeding date on which Distributions on the Trust Preferred Securities issued by the Trust would have been payable but for the election to begin or extend such Extension Period or (ii) subject to applicable principles of federal securities law, the date the Administrative Trustees are required to give notice to any securities exchange or other applicable self-regulatory organization or to holders of such Trust Preferred Securities of the record date or the date such Distributions are payable, but in any event not less than five Business Days prior to such record date. An Administrative Trustee shall give notice of the Company's election to begin or extend an Extension Period to the holders of such Trust Preferred Securities.] (b) [If the Property Trustee is not the only holder of the Junior Subordinated Notes at the time the Company elects to begin or extend an Extension Period,] the Company shall give the holders of the Junior Subordinated Notes, the Administrative Trustees and the Trustee written notice of its election to begin or extend such Extension Period at least 10 Business Days prior to the earlier of (i) the next succeeding Interest Payment Date or (ii) subject to applicable principles of federal securities law, the date the Company is required to give notice of the record or payment date of such interest payment to any applicable self-regulatory organization or to holders of the Junior Subordinated Notes. -10- (c) The quarter in which any notice is given pursuant to paragraphs (a) or (b) of this Section 4.2 shall be counted as one of the 20 consecutive quarters permitted in the maximum Extension Period permitted under Section 4.1. 4.3 Direct Action. Article Five of the Base Indenture is amended and supplemented, with respect to Junior Notes issued under the Indenture on or after the date hereof, to add a new section 516, which reads in its entirety as follows: In the case of Junior Subordinated Notes of a series issued to a Securities Trust, any holder of the corresponding series of Trust Preferred Securities issued by such Trust shall have the right, upon the occurrence of an Event of Default described in Section 501(1), 501(2) or 501(3) hereof, to institute a suit directly against the Company (a "Direct Action") for enforcement of payment to such holder of principal of (including premium, if any) and interest (including any Additional Interest) on the Junior Subordinated Notes having a principal amount equal to the aggregate liquidation amount of such Trust Securities of the corresponding series held by such holder. Notwithstanding any payments made to a holder of such Trust Securities by the Company pursuant to a Direct Action initiated by such holder, the Company shall remain obligated to pay the principal of or interest due on the Junior Subordinated Notes, and the Company shall be subrogated to the rights of the holder of such Trust Securities with respect to payments on the Trust Securities to the extent of any payments made by the Company to such holder in any Direct Action. [4.4 Set-Off. Section 1402 of the Base Indenture is amended and supplemented with respect to Junior Notes issued under the Indenture on or after the date hereof to add the following language at the end of the first sentence thereof: or under Section 516.] ARTICLE V EXPENSES 5.1 Payment of Expenses. In connection with the offering, sale and issuance of the Junior Subordinated Notes [to the Property Trustee and in connection with the offering, sale and issuance of the Trust Preferred Securities by the Trust], the Company, in its capacity as borrower with respect to the Junior Subordinated Notes, shall: (a) pay all costs and expenses relating to the offering, sale and issuance of the Junior Subordinated Notes, including [commissions to the Underwriters payable pursuant to the Underwriting Agreement and] compensation of the Trustee under the Indenture in accordance with the provisions of Section 607 of the Base Indenture; (b) [pay all costs and expenses of the Trust (including, but not limited to, costs and expenses relating to the organization of the Trust, the fees and expenses of the Property Trustee and the Delaware Trustee, the costs and expenses relating to the operation of the Trust, including without limitation, costs and expenses of accountants, attorneys, statistical or bookkeeping services, expenses for printing and engraving and computing or accounting equipment, paying agent(s), registrar(s), transfer agent(s), duplicating, travel and telephone and other telecommunications expenses and costs and expenses incurred in connection with the acquisition, financing, and disposition of Trust assets);] (c) [pay all costs and expenses related to the enforcement by the Property Trustee of the rights of the registered holders of the Trust Preferred Securities; -11- (d) be primarily liable for any indemnification obligations arising with respect to the Trust Agreement and the Underwriting Agreement; and (e) pay any and all taxes and all liabilities, costs and expenses with respect to such taxes of the Trust (but not including withholding taxes imposed on holders of Trust Preferred Securities or Common Securities of the Trust).] 5.2 Payment Upon Resignation or Removal. Upon termination of this Second Supplemental Indenture or the Base Indenture or the removal or resignation of the Trustee pursuant to Section 610 of the Base Indenture, the Company shall pay to the Trustee all amounts owed to it under Section 607 of the Base Indenture accrued to the date of such termination, removal or resignation. Upon termination of the Trust Agreement or the removal or resignation of the Delaware Trustee or the Property Trustee, as the case may be, pursuant to Section 6.6 of the Trust Agreement, the Company shall pay to the Delaware Trustee or the Property Trustee, and their respective counsel, as the case may be, all amounts owed to them under Section 4.2 of the Trust Agreement accrued to the date of such termination, removal or resignation. ARTICLE VI FORM OF JUNIOR SUBORDINATED JUNIOR SUBORDINATED NOTE 6.1 Form of Junior Subordinated Junior Subordinated Note. The Junior Subordinated Notes and the Trustee's Certificate of Authentication to be endorsed thereon are to be substantially in the form attached hereto as Exhibit A. ARTICLE VII ORIGINAL ISSUE OF JUNIOR SUBORDINATED NOTES 7.1 Original issue of Junior Subordinated Notes. Junior Subordinated Notes in the aggregate principal amount of up to $___________ may be executed by the Company and delivered to the Trustee for authentication by it, and the Trustee shall thereupon authenticate and deliver said Junior Subordinated Notes in accordance with a Company order without any further corporate action by the Company as follows: $___________ aggregate principal amount of Junior Subordinated Notes to be originally issued on the Closing Date [(as defined in the Underwriting Agreement)]. ARTICLE VIII MISCELLANEOUS 8.1 Ratification of Indenture; Second Supplemental Indenture Controls. The Indenture, as supplemented by this Second Supplemental Indenture, is in all respects ratified and confirmed, and this Second Supplemental Indenture shall be deemed part of the Indenture in the manner and to the extent herein and therein provided. The provisions of this Second Supplemental Indenture shall supersede the provisions of the Indenture to the extent the Indenture is inconsistent herewith. -12- 8.2 Trustee Not Responsible for Recitals. The recitals herein contained are made by the Company and not by the Trustee, and the Trustee assumes no responsibility for the correctness thereof. The Trustee makes no representation as to the validity or sufficiency of this Second Supplemental Indenture. 8.3 Governing Law. This Second Supplemental Indenture and each Junior Subordinated Note shall be deemed to be a contract made under the internal laws of the State of New York, and for all purposes shall be governed by and construed in accordance with the laws of said State, without regard to the conflicts of law principles thereof. 8.4 Separability. In case any one or more of the provisions contained in this Second Supplemental Indenture or in the Junior Subordinated Notes shall for any reason be held to be invalid, illegal or unenforceable in any respect, such invalidity, illegality or unenforceability shall not affect any other provisions of this Second Supplemental Indenture or of the Junior Subordinated Notes, but this Second Supplemental Indenture and the Junior Subordinated Notes shall be construed as if such invalid or illegal or unenforceable provision had never been contained herein or therein. 8.5 Counterparts. This Second Supplemental Indenture may be executed in any number of counterparts each of which shall be an original; but such counterparts shall together constitute but one and the same instrument. IN WITNESS WHEREOF, the parties hereto have caused this Second Supplemental Indenture to be duly executed as of the date first above written. VIRGINIA ELECTRIC AND POWER COMPANY By: ___________________________________ Name: Title: THE CHASE MANHATTAN BANK, as Trustee By: ___________________________________ Name: Title: -13- EXHIBIT A (FORM OF FACE OF JUNIOR SUBORDINATED NOTE) [If the Junior Subordinated Note is to be a Global Security, insert the following--THIS JUNIOR SUBORDINATED NOTE 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 OF A DEPOSITARY. THIS JUNIOR SUBORDINATED NOTE IS EXCHANGEABLE FOR JUNIOR SUBORDINATED NOTES REGISTERED IN THE NAME OF A PERSON OTHER THAN THE DEPOSITARY OR ITS NOMINEE ONLY IN THE LIMITED CIRCUMSTANCES DESCRIBED IN THE INDENTURE, AND NO TRANSFER OF THIS JUNIOR SUBORDINATED NOTE (OTHER THAN A TRANSFER OF THIS JUNIOR SUBORDINATED NOTE AS A WHOLE 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) MAY BE REGISTERED EXCEPT IN SUCH LIMITED CIRCUMSTANCES. UNLESS THIS JUNIOR SUBORDINATED NOTE 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 JUNIOR SUBORDINATED NOTE 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 HEREON IS MADE TO CEDE & CO., ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY A PERSON IS WRONGFUL SINCE THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.] THE JUNIOR SUBORDINATED NOTES EVIDENCED HEREBY WILL BE ISSUED, AND MAY BE TRANSFERRED, ONLY IN BLOCKS HAVING A PRINCIPAL AMOUNT OF NOT LESS THAN $_______. ANY TRANSFER, SALE OR OTHER DISPOSITION OF SUCH JUNIOR SUBORDINATED NOTES IN A BLOCK HAVING A PRINCIPAL AMOUNT OF LESS THAN $_______ SHALL BE DEEMED TO BE VOID AND OF NO LEGAL EFFECT WHATSOEVER. ANY SUCH TRANSFEREE SHALL BE DEEMED NOT TO BE THE HOLDER OF SUCH JUNIOR SUBORDINATED NOTES FOR ANY PURPOSE, INCLUDING BUT NOT LIMITED TO THE RECEIPT OF PAYMENTS IN RESPECT OF SUCH JUNIOR SUBORDINATED NOTES, AND SUCH TRANSFEREE SHALL BE DEEMED TO HAVE NO INTEREST WHATSOEVER IN SUCH JUNIOR SUBORDINATED NOTES. -14- NUMBER ____ [up to]/1/ $___________ VIRGINIA ELECTRIC AND POWER COMPANY ___% JUNIOR SUBORDINATED JUNIOR SUBORDINATED NOTE DUE __________, 20__ Dated:__________________ CUSIP NO: ___________________] Security Registered Holder: VIRGINIA ELECTRIC AND POWER COMPANY, a corporation duly organized and existing under the laws of the Commonwealth of Virginia (herein referred to as the "Company," which term includes any successor corporation under the Indenture hereinafter referred to), for value received, hereby promises to pay to the Security Registered Holder named above, the principal sum [of ___________________________ Dollars($__________))]/2/ [specified in the Schedule annexed hereto]/3/ on __________, 20__, in such coin or currency of the United States of America as at the time of payment is legal tender for the payment of public and private debt. The Company further promises to pay to the registered Holder hereof as hereinafter provided (a) interest on said principal sum (subject to deferral as set forth herein) at the rate per annum specified in the title of this junior subordinated note (the "Junior Subordinated Note"), in like coin or currency, semiannually in arrears on the 1st day of June and December (each an "Interest Payment Date") commencing ______, 20__, from the Interest Payment Date next preceding the date hereof to which interest has been paid or duly provided for (unless (i) no interest has yet been paid or duly provided for on this Junior Subordinated Note, in which case from __________, ____, or (ii) the date hereof is before an Interest Payment Date but after the related Record Date (as defined below), in which case from such following Interest Payment Date; provided, however, that if the Company shall default in payment of the interest due on such following Interest Payment Date, then from the next preceding Interest Payment Date to which interest has been paid or duly provided for), until the principal hereof is paid or duly provided for, plus (b) Additional Interest, as defined in the Indenture, to the extent permitted by applicable law, on any interest payment that is not made on the applicable Interest Payment Date, which shall accrue at the rate per annum specified in the title of this Junior Subordinated Note, compounded semiannually. The interest so payable will, subject to certain exceptions provided in the Indenture hereinafter referred to, be paid to the person in whose name this Junior Subordinated Note is registered at the close of business on the Record Date next preceding such Interest Payment Date. The Record Date shall be the Business Day next preceding the Interest Payment Date, unless this Junior Subordinated Note is registered to a holder other than [the ________________ /1/ Insert in Global Junior Notes. /2/ Insert in all Junior Subordinated Notes other than Global Junior Notes. /3/ Insert in Global Junior Notes. -15- Property Trustee] or a nominee of The Depository Trust Company, in which case the Record Date will be the fifteenth day of the calendar month next preceding such Interest Payment Date or, if such fifteenth day is not a Business Day, then the Business Day next preceding such day. This Junior Subordinated Note may be presented for payment of principal and interest at the principal corporate trust office of The Chase Manhattan Bank, as paying agent for the Company, maintained for that purpose in the Borough of Manhattan, The City of New York; provided, however, that payment of interest may be made at the option of the Company (i) by check mailed to such address of the person entitled thereto as the address shall appear on the Security Register of the Junior Subordinated Notes or (ii) by transfer to an account maintained by the Person entitled thereto as specified in the Security Register, provided that proper transfer instructions have been received by the Record Date. Interest on the Junior Subordinated Note will be computed on the basis of a 360-day year of twelve 30-day months. [So long as no Event of Default has occurred and is continuing, the Company shall have the right at any time during the term of this Junior Subordinated Note from time to time to defer payment of interest on this Junior Subordinated Note, for up to 10 consecutive semiannual interest payment periods with respect to each deferral period (each an "Extension Period"), during which Extension Periods the Company shall have the right to make partial payments of interest on any Interest Payment Date; provided, however, that no Extension Period shall end on a date other than an Interest Payment Date or extend beyond __________, 20__. At the end of each Extension Period, the Company shall pay all interest then accrued and unpaid (together with any Additional Interest thereon to the extent permitted by applicable law.) (During any such Extension Period, the Company shall not, and shall cause any Subsidiary of the Company not to, (i) declare or pay any dividends or distributions on, or redeem, purchase, acquire or make a liquidation payment with respect to, any of the Company's Capital Stock (which includes common capital stock and preferred stock) or (ii) make any payment of principal of or interest or premium, if any, on or repay, repurchase or redeem any debt securities of the Company that rank on a parity with or junior to this Junior Subordinated Note or make any guarantee payments with respect to any guarantee by the Company of the debt securities of any Subsidiary of the Company that by its terms ranks on a parity with or junior to this Junior Subordinated Note (other than (a) dividends or distributions in common capital stock, (b) any declaration of a dividend in connection with the implementation of a Rights Plan, the issuance of any Capital Stock or any class or series of preferred stock of the Company under any shareholder's rights plan or the redemption or repurchase of any rights distributed pursuant to a Rights Plan and (c) purchases of common capital stock related to the issuance of common capital stock or rights under any of the Company's benefit plans for its directors, officers, employees, consultants or advisors). Prior to the termination of any such Extension Period, the Company may further extend such Extension Period; provided, however, that no Extension Period shall exceed 10 consecutive semiannual periods or extend beyond __________, 20__. At any time following the termination of any Extension Period and the payment of all accrued and unpaid interest (together with any Additional Interest and if applicable) then due, the Company may elect to begin a new Extension Period, subject to the above requirements. No interest shall be due and payable during an Extension Period except at the end thereof. [If the Property Trustee is the only Security Registered holder of the Junior Subordinated Notes of this series, the Company shall -16- give written notice to the Property Trustee and the Trustee of its election to begin or extend any Extension Period at least five Business Days prior to the earlier of (i) the next succeeding date on which Distributions on the Trust Preferred Securities issued by the relevant Securities Trust would have been payable but for the election to begin or extend such Extension Period or (ii) the date the Administrative Trustees are required to give notice to any securities exchange or other applicable self-regulatory organization or to holders of such Trust Preferred Securities of the record date or the date such Distributions are payable, but in any event not less than five Business Days prior to such record date.] [An Administrative Trustee shall give notice of the Company's election to begin or extend an Extension Period to the holders of such Trust Preferred Securities.] [If the Property Trustee is not the only holder of the Junior Subordinated Notes of this series at the time the Company elects to begin or extend an Extension Period,] the Company shall give the holders of the Junior Subordinated Notes of this series and the Trustee written notice of its election to begin or extend such Extension Period at least 10 Business Days prior to the earlier of (i) the next succeeding Interest Payment Date or (ii) the date the Company is required to give notice of the record or payment date of such interest payment to any applicable self-regulatory organization or to holders of the Junior Subordinated Notes of this series.] This Junior Subordinated Note is issued pursuant to an Indenture, dated as of August 1, 1995 between the Company, as issuer, and The Chase Manhattan Bank, a New York banking corporation, as trustee, as supplemented by a First Supplemental Indenture dated as of August 1, 1995 and a Second Supplemental Indenture dated as of ________, 200_ (as further supplemented or amended from time to time, the "Indenture"). Reference is made to the Indenture for a description of the respective rights, limitations of rights, obligations, duties and immunities thereunder of the Trustee, the Company and the Holders (the word "Holder" or "Holders" meaning the registered holder or registered holders) of the Junior Subordinated Note. Capitalized terms used herein but not defined herein shall have the respective meanings assigned thereto in the Indenture. By acceptance of this Junior Subordinated Note, the Holder hereof agrees to be bound by the provisions of the Indenture. The Junior Subordinated Notes of this series are limited to the aggregate principal amount of ___________ ______________________________ Dollars ($___________). The Junior Subordinated Notes evidenced by this Certificate may be transferred or exchanged only in minimum denominations of $_______ and integral multiples of $_____ in excess thereof, and any attempted transfer, sale or other disposition of Junior Subordinated Notes in a denomination of less than $_______ shall be deemed to be void and of no legal effect whatsoever. The indebtedness of the Company evidenced by this Junior Subordinated Note, including the principal hereof and interest hereon, is, to the extent and in the manner set forth in the Indenture, subordinate and junior in right of payment to the Company's obligations to Holders of Senior Indebtedness of the Company and each Holder of this Junior Subordinated Note, by -17- acceptance hereof, agrees to and shall be bound by such provisions of the Indenture and all other provisions of the Indenture. This Junior Subordinated Note shall not be valid or become obligatory for any purpose until the certificate of authentication hereon shall have been signed by or on behalf of the Trustee under the Indenture. IN WITNESS WHEREOF, VIRGINIA ELECTRIC AND POWER COMPANY has caused this instrument to be signed, manually or in facsimile, by its Chairman of the Board, or its Chief Executive Officer, or its President, or any Vice President under the corporate seal of Virginia Electric and Power Company attested by its Corporate Secretary or an Assistant Corporate Secretary VIRGINIA ELECTRIC AND POWER COMPANY By: _________________________________ Name: Title: [SEAL] TRUSTEE'S CERTIFICATE OF AUTHENTICATION This is one of the Securities, of the series designated herein, referred to in the within-mentioned Indenture. THE CHASE MANHATTAN BANK, as Trustee By: ____________________________ Authorized Officer -18- REVERSE OF JUNIOR SUBORDINATED NOTE [As provided in and subject to the provisions in the Indenture, the Company shall have the right redeem this Junior Subordinated Note, in whole or in part, at any time on or after __________, 20__, at the Optional Prepayment Prices set forth below (expressed as percentages of the principal amount to be prepaid) plus accrued and unpaid interest thereon to the applicable date of prepayment if prepaid during the 12-month period beginning on __________, of the years indicated below: Year Percentage ---- ---------- 20__............................. 10_.___% 20__............................. 10_.___% 20__............................. 10_.___% 20__............................. 10_.___% 20__............................. 10_.___% 20__............................. 10_.___% 20__............................. 10_.___% 20__............................. 10_.___% 20__............................. 10_.___% 20__............................. 10_.___% 20__ and thereafter.............. 100.000% In addition, upon the occurrence and during the continuation of a Tax Event or Investment Company Event, the Company may, at its option, at any time, prior to the Initial Optional Prepayment Date, within 90 days of the occurrence of such Tax Event or Investment Company Event, redeem this Junior Subordinated Note in whole (but not in part) at a prepayment price (the "Event Prepayment Price") equal to the greater of (i) 100% of the principal amount hereof or (ii) as determined by a Quotation Agent, the sum of the present values of the Optional Prepayment Price that would be payable on the Initial Optional Prepayment Date, together with the present values of scheduled payments of interest from the prepayment date to the Initial Optional Prepayment Date, in each case discounted to the prepayment date on a semi-annual basis at the Adjusted Treasury Rate, plus, in each case, accrued interest thereon to but excluding the date of prepayment.] In the case an Event of Default, as defined in the Indenture, shall have occurred and be continuing, the principal of all of the Junior Subordinated Notes may be declared, and upon such declaration shall become, due and payable, in the manner, with the effect and subject to the conditions provided in the Indenture. Any consent or waiver by the Holder of this Junior Subordinated Note given as provided in the Indenture shall be conclusive and binding upon such Holder and upon all future Holders of this Junior Subordinated Note and of any Junior Subordinated Note issued in exchange, registration of transfer, or otherwise in lieu hereof irrespective of whether any notation of such -19- consent or waiver is made upon this Junior Subordinated Note or such other Junior Notes. No reference herein to the Indenture and no provision of this Junior Subordinated Note or of the Indenture shall alter or impair the obligation of the Company, which is absolute and unconditional, to pay the principal of and interest on this Junior Subordinated Note, at the places, at the respective times, at the 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 Junior Subordinated Note may be registered on the Security Register of the Junior Subordinated Notes of this series upon surrender of this Junior Subordinated Note for registration of transfer at the offices maintained by the Company or its agent for such purpose, duly endorsed by the Holder hereof or his attorney duly authorized in writing, 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, but without payment of any charge other than a sum sufficient to reimburse the Company for any tax or other governmental charge incident thereto. Upon any such registration of transfer, a new Junior Subordinated Note or Junior Subordinated Notes of authorized denomination or denominations for the same aggregate principal amount will be issued to the transferee in exchange herefor. Prior to due presentment for registration of transfer of this Junior Subordinated Note, the Company, the Trustee, and any agent of the Company or the Trustee may deem and treat the person in whose name this Junior Subordinated Note shall be registered upon the Security Register of the Junior Subordinated Notes of this series as the absolute owner of this Junior Subordinated Note (whether or not this Junior Subordinated Note shall be overdue and notwithstanding any notation of ownership or other writing hereon) for the purpose of receiving payment of or on account of the principal hereof and, subject to the provisions on the face hereof, interest due hereon and for all other purposes; and neither the Company nor the Trustee nor any such agent shall be affected by any notice to the contrary. No recourse shall be had for the payment of the principal of or interest on this Junior Subordinated Note, or for any claim based hereon or otherwise in respect hereof, or based on or in respect of the Indenture or any indenture supplemental thereto, against any stockholder, officer, director or employee, as such, past, present or future, of the Company or of any successor corporation, either directly or through the Company, whether by virtue of any constitution, statute or rule of law, or by the enforcement of any assessment or penalty or otherwise, all such liability being, by the acceptance hereof and as a part of the consideration for the issue hereof, expressly waived and released. The Company and, by acceptance of this Junior Subordinated Note or a beneficial interest in this Junior Subordinated Note, each holder hereof and any person acquiring a beneficial interest herein, agree that for United States federal, state and local tax purposes it is intended that this Junior Subordinated Note constitute indebtedness. -20- This Junior Subordinated Note shall be deemed to be a contract made under the laws of the State of New York (without regard to conflicts of laws principles thereof) and for all purposes shall be governed by, and construed in accordance with, the laws of said State. -21- EX-4.IX 9 0009.txt EIGHTY-SIXTH SUPPLEMENTAL INDENTURE EXHIBIT 4(ix) ================================================================================ VIRGINIA ELECTRIC AND POWER COMPANY TO THE CHASE MANHATTAN BANK Trustee. Eighty-Sixth Supplemental Indenture Dated ___________, 200_ ____________ $_________ First and Refunding Mortgage Bonds of 200_,Series__, ____%, due _______, 20__ ================================================================================ A MORTGAGE OF BOTH REAL AND PERSONAL PROPERTY. -1- TABLE OF CONTENTS/1/
Page ---- Parties............................................................................ 1 Addresses.......................................................................... 1 Recitals........................................................................... 1 Consideration Clause............................................................... 5 Granting Clause.................................................................... 5 Exception Clause................................................................... 7 Habendum Clause.................................................................... 7 Grant in Trust..................................................................... 7 ARTICLE 1. BONDS OF 20__, SERIES __ (S) 1.01 Establishment, form and terms.......................................... 8 (S) 1.02 Registration, transfer and exchange.................................... 9 (S) 1.03 Procedure for payment of interest...................................... 10 (S) 1.04 Redemption............................................................. 10 (S) 1.05 Funds deposited for maturity to be immediately available............... 11 ARTICLE 2. MISCELLANEOUS PROVISIONS (S) 2.01 References to Original Indenture or previous Supplemental Indentures... 11 (S) 2.02 The Trustee............................................................ 12 (S) 2.03 Original Indenture and Supplemental Indentures to be read together..... 12 (S) 2.04 Date of execution...................................................... 12 (S) 2.05 Execution in counterparts.............................................. 12 Testimonium........................................................................ 13 Signatures and Seals............................................................... 14 Acknowledgments.................................................................... 15
________________ /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. -2- EIGHTY-SIXTH SUPPLEMENTAL INDENTURE dated the ____ day of _____, 200_, by and between VIRGINIA ELECTRIC AND POWER COMPANY, a Virginia corporation and a transmitting utility (as such term is defined in Section 46-9-105(n) of the West Virginia Code), One James River Plaza, Richmond, Virginia (the Company), party of the first part, and THE CHASE MANHATTAN BANK (NATIONAL ASSOCIATION), a national banking association, One Chase Manhattan Plaza, New York, New York (the Trustee), party of the second part. The Company has heretofore made its Indenture of Mortgage dated November 1, 1935 (the Original Indenture) to The Chase National Bank of the City of New York, predecessor Trustee, and various supplemental indentures supplementing and/or modifying the Original Indenture as follows: Title Dated ----- ----- First Supplemental Indenture............................... September 1, 1938 Second Supplemental Indenture.............................. February 9, 1940 Third Supplemental Indenture............................... March 1, 1941 Fourth Supplemental Indenture.............................. April 1, 1944 Fifth Supplemental Indenture............................... March 1, 1945 Sixth Supplemental Indenture............................... October 1, 1947 Seventh Supplemental Indenture............................. March 1, 1948 Eighth Supplemental Indenture.............................. October 1, 1948 Ninth Supplemental Indenture............................... June 1, 1949 Tenth Supplemental Indenture............................... November 1, 1949 Eleventh Supplemental Indenture............................ September 1, 1950 Twelfth Supplemental Indenture............................. December 1, 1951 Thirteenth Supplemental Indenture.......................... October 1, 1952 Fourteenth Supplemental Indenture.......................... May 1, 1954 and has heretofore made to The Chase Manhattan Bank, which on March 31, 1955, became the Trustee under the Mortgage by virtue of the merger of The Chase National Bank of the City of New York into President and Directors of the Manhattan Company under the name of The Chase Manhattan Bank (now The Chase Manhattan Bank (National Association)), further supplemental indentures supplementing and/or modifying the Original Indenture as follows: Title Dated ----- ----- Fifteenth Supplemental Indenture............................June 1, 1955 Sixteenth Supplemental Indenture............................September 1, 1956 Seventeenth Supplemental Indenture..........................December 1, 1957 Eighteenth Supplemental Indenture...........................June 1, 1958 Nineteenth Supplemental Indenture...........................April 1, 1959 Twentieth Supplemental Indenture............................September 1, 1960 Twenty-First Supplemental Indenture.........................June 1, 1961 Twenty-Second Supplemental Indenture........................May 1, 1963 Twenty-Third Supplemental Indenture.........................December 1, 1963 Twenty-Fourth Supplemental Indenture........................May 1, 1965 Twenty-Fifth Supplemental Indenture.........................February 1, 1967 Twenty-Sixth Supplemental Indenture.........................December 1, 1967 Twenty-Seventh Supplemental Indenture.......................January 1, 1969 Twenty-Eighth Supplemental Indenture........................June 1, 1969 Twenty-Ninth Supplemental Indenture.........................April 1, 1970 Thirtieth Supplemental Indenture............................September 1, 1970 Thirty-First Supplemental Indenture.........................March 1, 1971 Thirty-Second Supplemental Indenture........................September 1, 1971 Thirty-Third Supplemental Indenture.........................June 1, 1972 Thirty-Fourth Supplemental Indenture........................July 1, 1974 Thirty-Fifth Supplemental Indenture.........................July 1, 1974 Thirty-Sixth Supplemental Indenture.........................February 1, 1975 Thirty-Seventh Supplemental Indenture.......................September 1, 1975 Thirty-Eighth Supplemental Indenture........................November 1, 1975 Thirty-Ninth Supplemental Indenture.........................March 1, 1976 Fortieth Supplemental Indenture.............................May 1, 1976 Forty-First Supplemental Indenture..........................September 1, 1976 Forty-Second Supplemental Indenture.........................March 1, 1977 Forty-Third Supplemental Indenture..........................March 1, 1978 Forty-Fourth Supplemental Indenture.........................May 1, 1978 Forty-Fifth Supplemental Indenture..........................July 1, 1978 Forty-Sixth Supplemental Indenture..........................April 1, 1979 Forty-Seventh Supplemental Indenture........................October 1, 1979 Forty-Eighth Supplemental Indenture.........................July 1, 1980 Forty-Ninth Supplemental Indenture..........................April 1, 1981 Fiftieth Supplemental Indenture.............................July 1, 1981 Fifty-First Supplemental Indenture..........................July 1, 1981 Fifty-Second Supplemental Indenture.........................September 1, 1982 Fifty-Third Supplemental Indenture..........................December 1, 1982 Fifty-Fourth Supplemental Indenture.........................June 1, 1983 Fifty-Fifth Supplemental Indenture..........................June 1, 1984 Fifty-Sixth Supplemental Indenture..........................September 1, 1984 Fifty-Seventh Supplemental Indenture........................November 1, 1984 Fifty-Eighth Supplemental Indenture.........................December 1, 1984 Fifty-Ninth Supplemental Indenture..........................April 1, 1986 Sixtieth Supplemental Indenture.............................November 1, 1986 Sixty-First Supplemental Indenture..........................June 1, 1987 Sixty-Second Supplemental Indenture.........................November 1, 1987 Sixty-Third Supplemental Indenture..........................June 1, 1988 Sixty-Fourth Supplemental Indenture.........................February 1, 1989 Sixty-Fifth Supplemental Indenture..........................June 1, 1989 Sixty-Sixth Supplemental Indenture..........................March 1, 1990 Sixty-Seventh Supplemental Indenture........................April 1, 1991 Sixty-Eighth Supplemental Indenture.........................March 1, 1992 Sixty-Ninth Supplemental Indenture..........................March 1, 1992 Seventieth Supplemental Indenture...........................March 1, 1992 -2- Seventy-First Supplemental Indenture........................July 1, 1992 Seventy-Second Supplemental Indenture.......................July 1, 1992 Seventy-Third Supplemental Indenture........................August 1, 1992 Seventy-Fourth Supplemental Indenture.......................February 1, 1993 Seventy-Fifth Supplemental Indenture........................April 1, 1993 Seventy-Sixth Supplemental Indenture........................April 1, 1993 Seventy-Seventh Supplemental Indenture......................June 1, 1993 Seventy-Eighth Supplemental Indenture.......................August 1, 1993 Seventy-Ninth Supplemental Indenture........................August 1, 1993 Eightieth Supplemental Indenture............................October 1, 1993 Eighty-First Supplemental Indenture.........................January 1, 1994 Eighty-Second Supplemental Indenture........................January 1, 1994 Eighty-Third Supplemental Indenture.........................October 1, 1994 Eighty-Fourth Supplemental Indenture........................March 1, 1995 The Original Indenture and such supplemental indentures are incorporated herein by this reference and the Original Indenture as so supplemented and modified is herein called the Mortgage. First and Refunding Mortgage Bonds (the Bonds) are presently outstanding under the Mortgage as follows [May 30, 1995]: Series U, 5 1/8%, due February 1, 1997.......................$ 49,290,000 Bonds of 1988, Series A, 9 3/8%, due June 1, 1998............ 150,000,000 Bonds of 1989, Series B, 8 7/8%, due June 1, 1999............ 100,000,000 Bonds of 1991, Series A, 8 3/4%, due April 1, 2021........... 100,000,000 Bonds of 1992, Series B, 7 1/4%, due March 11997............. 250,000,000 Bonds of 1992, Series C, 8%, due March 1, 2004............... 250,000,000 Bonds of 1992, Series D, 7 5/8%, due July 1, 2007............ 215,000,000 Bonds of 1992, Series E, 7 3/8%, due July 1, 2002............ 155,000,000 Bonds of 1992, Series F, 6 1/4%, due August 1, 1998............75,000,000 Bonds of 1993, Series A, 7 1/4%, due February 1, 2023........ 100,000,000 Bonds of 1993, Series B, 6 5/8%, due April 1, 2003........... 200,000,000 Bonds of 1993, Series C, 5 7/8%, due April 1, 2000........... 135,000,000 Bonds of 1993, Series D, 7 1/2%, due June 1, 2023.............200,000,000 -3- Bonds of 1993, Series E, 6%, due August 1, 2001...............100,000,000 Bonds of 1993, Series F, 6%, due August 1, 2002...............100,000,000 Bonds of 1993, Series G, 6 3/4%, due October 1, 2023..........200,000,000 Pollution Control Series 1994A, 5.45%, due January 1, 2024.....19,500,000 Bonds of 1994, Series A, 7%, due January 1, 2024..............125,000,000 Bonds of 1994, Series B, 8 5/8%, due October 1, 2024..........200,000,000 Bonds of 1995, Series A, 8 1/4%, due March 1, 2025............200,000,000 (*Subject to deletion of retired series or portions thereof and addition of new series, as issued) Under the Mortgage, any new series of Bonds may at any time be established by the Board of Directors of the Company in accordance with the provisions of the Mortgage (up to an aggregate amount of $__________ outstanding at any one time without further authorization of the stockholder of the Company) and their terms may be described by a supplemental indenture executed by the Company and the Trustee. The Company proposes to create under the Mortgage, as hereby supplemented (the Indenture), a new series of Bonds to be designated First and Refunding Mortgage Bonds of 200_, Series __, __%, due________ __, ____, to bear interest from _______ __, 200_, and to be due _______ __, 20__ and proposes to issue $______ aggregate principal amount of such Bonds. The aggregate principal amount of Bonds of the Company, issued or so to be issued and outstanding under the provisions of and secured by the Indenture, will then be $_______ , consisting of $_______ aggregate principal amount of Bonds presently outstanding and $_______ aggregate principal amount of Bonds of 200_, Series __, which are to be issued after the execution and delivery of this Eighty-Sixth Supplemental Indenture pursuant to Article 2 of the Original Indenture. Additional Bonds of certain series herein mentioned and additional Bonds of all other series hereafter established, except as may be limited in the 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. The Company also desires to supplement the Mortgage and add new provisions thereto pursuant to the provisions of (S)13.01 of the Original Indenture. All conditions necessary to authorize the execution, delivery and recording of this Eighty-Sixth Supplemental Indenture and to make it a valid and binding indenture of mortgage for the security of the Bonds of the Company issued or to be issued under the Indenture have been done or performed. NOW, THEREFORE, THIS INDENTURE WITNESSETH, -4- That, in order further to secure equally and ratably the payment of the principal of and interest on the Bonds at any time issued and outstanding under the Indenture, according to their tenor and effect, and the performance of all the covenants and conditions contained in the Indenture or in the Bonds, and for the purpose, among others, of confirming the lien of the Indenture, the Company, for and in consideration of the premises and of the purchase and acceptance of the Bonds by the holders thereof, and of the sum of One Dollar ($1.00) and of other valuable consideration to it duly paid by the Trustee at or before the execution and delivery of these presents, the receipt whereof is hereby acknowledged, has executed and delivered these presents and does hereby grant, bargain, sell, convey, transfer, assign, mortgage, pledge and confirm to the Trustee and its successors in the trust created by the Indenture and to its and their assigns, [If specific property is to be mortgaged under the Supplemental Indenture -- the property hereinafter described, to wit:] [If no specific property is to be mortgaged under the Supplemental Indenture -- all property, real, personal and mixed, tangible and intangible, rights, privileges, franchises and immunities, now owned by the Company and within the Granting Clauses covering after-acquired property. But expressly excepting (unless and until hereafter mortgaged, pledged or assigned to the Trustee or otherwise made subject to the lien of the Indenture, or required so to be by any provision therein) all properties that would be excepted by clauses (A) through (H) of Part VI of the Granting Clauses of the Fourteenth Supplemental Indenture as if such clauses were herein set out in full.] -5- DESCRIPTION OF MORTGAGED PROPERTY PART I. LAND. All the tracts or parcels of land or interests in land, together with all the improvements thereon, and all rights, privileges and appurtenances thereunto belonging or in anywise appertaining, and all equipment, fixtures and apparatus, property, real, personal and mixed, used in connection therewith, whether attached to the freehold or not, conveyed to the Company as indicated in the tables below: IN VIRGINIA Recordation Data ----------- Grantor Recording Office Date of Deed Book No. Page ------- ---------------- ------------ -------- ---- IN [OTHER STATES] Recordation Data ----------- Grantor Recording Office Date of Deed Book No. Page ------- ---------------- ------------ -------- ---- PART II. FRANCHISES. PART III. ELECTRIC LINES AND SYSTEMS. All electric lines and systems now owned by the Company, including those described below: Beginning Ending Length In Miles --------- ------ --------------- PART IV. OTHER PROPERTY. -6- All other property, real, personal and mixed, tangible and intangible, now owned by the Company or hereafter acquired, except as herein excepted. PART V. INCOME. All tolls, revenues, earnings, income, rents, issues and profits of all property hereby mortgaged and conveyed. PART VI. PROPERTIES EXCEPTED. But expressly excepting (unless and until hereafter mortgaged, pledged or assigned to the Trustee or otherwise made subject to the lien of the Indenture, or required so to be by any provision therein) all properties that would be excepted by clauses (A) through (H) of Part VI of the Granting Clauses of the Fourteenth Supplemental Indenture as if such clauses were herein set out in full.] TO HAVE AND TO HOLD all and singular the aforesaid property, rights, privileges, franchises and immunities, whether now owned or hereafter acquired, unto the Trustee, its successors in the trust created by the Indenture and its and their assigns forever: BUT IN TRUST NEVERTHELESS, for the further and equal pro rata benefit, security and protection of all present and future holders of the Bonds issued and to be issued under and secured by the Indenture, and to secure the payment of the principal of and interest on the Bonds thereon, in accordance with provisions of the Bonds and of the Indenture, without any discrimination, preference, priority or distinction as to lien or otherwise of any Bonds over any other Bonds, by reason of priority in time of the issue or negotiation thereof or otherwise howsoever, so that the principal and interest of every Bond shall be equally and ratably secured hereby as if all the Bonds had been issued, sold and delivered for value simultaneously with the execution of the Original Indenture, and to secure the performance of and compliance with the covenants and conditions of the Bonds and of the Indenture, and upon the trusts and for the uses and purposes and subject to the covenants, agreements, provisions and conditions set forth and declared in the Indenture. ARTICLE 1. BONDS OF 200_, Series __ (S)1.01. There is hereby established a new series of Bonds to be issued under and secured by the Indenture, to be designated as the Company's First and Refunding Mortgage Bonds of 200_, Series __, ___%, due ______ __, 20__ (the Bonds of 200_, Series __). There are to be authenticated and delivered $________ principal amount of Bonds of 200_ Series __, and no further Bonds of 200_, Series __ shall be authenticated and delivered -7- except upon exchange or transfer pursuant to (S)1.11 of the Original Indenture. The Bonds of 200_, Series __ shall be registered bonds, without coupons. The Bonds of 200_, Series __ shall be in substantially the form set out in Article 2 of the Twenty-Fifth Supplemental Indenture with such insertions, modifications and additions as may be required by the particular terms and provisions of this Eighty-Sixth Supplemental Indenture (and in particular this (S)1.01 and (S)1.04 hereof) for the Bonds of 200_, Series __. Each Bond of 200_, Series __ 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. All Bonds of 200_, Series __ shall be due on _______ __, 20__, and shall bear interest at the rate of __% per annum, to be paid semi-annually on the first day of _____ and on the first day of _____ in each year until payment of the principal thereof. The principal, premium, if any, and interest on the Bonds of 200_, Series __, shall be payable in lawful money of the United States of America, at the office or agency of The Chase Manhattan Bank (National Association), or its successor in trust under the Indenture, in New York, New York. The Regular Record Date for the payment of the interest payable, and punctually paid or duly provided for, on any Interest Payment Date with respect to the Bonds of 200_, Series __ shall be the fifteenth day (whether or not a business day) of the calendar month next preceding such Interest Payment Date. Definitive Bonds of 200_, Series __ may be issued in the denomination of $______, or any integral multiple thereof. (S)1.02. The Trustee shall, by virtue of its office as Trustee, be the Registrar and Transfer Agent of the Company for the purpose of registering and transferring Bonds of 200_, Series __. The Company shall cause to be kept at the office or agency of the Registrar books for such registration and transfer (the Bond Register) and will permit Bonds of 200_, Series __ to be transferred or registered thereon, in accordance with their terms and under such reasonable regulations as the Company may prescribe. Upon surrender for transfer of any Bonds of 200_, Series __ at the office or agency of the Registrar, the Company shall execute, and the Trustee shall authenticate and deliver, in the name of the designated transferee or transferees, one or more new Bonds of 200_, Series __ of any authorized denominations, of a like aggregate principal amount. At the option of the registered holder, Bonds of 200_, Series __ may be exchanged for other Bonds of 200_, Series ___ of any authorized denominations, of a like aggregate principal amount, upon surrender of Bonds of 200_, Series __ to be exchanged at the office or agency of the Registrar. Whenever any Bonds of 200_, Series __ are so surrendered for exchange, the Company shall execute, and the Trustee shall authenticate and deliver, the Bonds of 200_, Series __ which the bondholder making the exchange is entitled to receive. All Bonds of 200_, Series __ issued upon any such transfer or exchange shall be the valid obligations of the Company, evidencing the same debt, and entitled to the same benefits under the Indenture, as the Bonds of 200_, Series __ surrendered upon such transfer or exchange. -8- Every Bond of 200_, Series __ presented or surrendered for transfer or exchange shall (if so required by the Company or the Trustee) be duly endorsed, or be accompanied by a written instrument of transfer in form satisfactory to the Company and to the Registrar duly executed, by the holder thereof or his attorney duly authorized in writing. No service charge will be made for any transfer or exchange of Bonds of 200_, Series __, but payment will be required of a sum sufficient to cover any tax or other governmental charge that may be imposed in connection therewith. [The provisions of (S)1.06, (S)1.08 and (S)1.09 of the Original Indenture shall (not) be applicable to the Bonds of 200_, Series __.] The Company shall not be required (a) to issue, transfer or exchange any Bonds of 200_, Series __ during a period beginning at the opening of business 15 days before the day of the mailing of a notice of redemption of less than all of the outstanding Bonds of 200_, Series __ and ending at the close of business on the day of the mailing, or (b) to transfer or exchange any Bonds of 200_, Series __ theretofore selected for redemption in whole or in part. (S)1.03. Reference is made to (S)1.03 of the Twenty-Fifth Supplemental Indenture for provisions concerning the procedure for the payment of interest on the Bonds of 200_, Series __. [(S)1.04. The Bonds of 200_, Series __ shall be subject to redemption at the option of the Company, as a whole or in part, at any time or from time to time, on or after _______ __, ____, at the percentages of the principal amount thereof specified in the following table under the heading "Regular Redemption Price". The Bonds of 200_, Series __ shall also be subject to redemption at the option of the Company, as a whole or in part, at any time or from time to time, on or after _____ __, ____, at the percentages of the principal amount thereof specified in the following table under the heading "Special Redemption Price", if redeemed (a) by the application of cash from the Maintenance and Improvement Fund provided by (S)3.01 of the Third Supplemental Indenture, (b) by the application of Funds in Escrow as defined in (S)6.02 of the Original Indenture or (c) as a whole within 12 months after acquisition of not less than a majority of the outstanding Common Stock of the Company by any municipality or governmental body, agency, instrumentality or authority, or any non-profit cooperative body, or any nominee thereof: [TABLE] together with any unmatured interest accrued to the Redemption Date, payable on surrender for redemption (the interest installment payable on the Redemption Date, if such date is an Interest Payment Date, to be paid to the holder of record at the close of business on the Regular Record Date for such Interest Payment Date). [But prior to ______ __, ____, the Company may not redeem any of the Bonds of 200_, Series __, directly or indirectly from or in anticipation of moneys borrowed involving an interest cost to the Company (calculated in accordance with accepted financial practice) of less than __% per year.] -9- Notice of redemption shall be given by first-class mail, postage prepaid, mailed not less than 30 nor more than 60 days prior to the Redemption Date, to each holder at his address appearing in the Bond Register and shall contain the information required by (S)3.02 of the Original Indenture. There need be no publication of such notice despite the provisions of such (S)3.02. [The Company shall not redeem, purchase or otherwise acquire for a consideration any of the Bonds of 200_, Series __, except by redemption thereof pursuant to this (S)1.04.] [No supplemental indenture entered into pursuant to (S)14.01 of the Original Indenture shall amend or otherwise modify any provision contained in this (S)1.04 (other than provisions regarding the manner, form and timing of notice pursuant to the second paragraph of this (S)1.04) without the consent of all the holders of Bonds of 200_, Series __, then outstanding; nor shall any default by the Company in the performance of its obligations under this (S)1.04 (other than the manner, form and timing of notice pursuant to the second paragraph of this (S)1.04), and the consequences thereof, be waived pursuant to (S)7.24 of the Original Indenture without like consent.]] [(S)1.05. Irrespective of any provision of the Indenture or of the Bonds of 200_, Series __ to the contrary, so long as any purchaser under one of the Purchase Agreements (as hereinafter defined), or a nominee thereof, shall be a registered holder of any of the Bonds of 200_, Series __, or if any other institutional investor or its nominee or nominees shall at any time be the registered holder or holders of at least __% of the aggregate principal amount of Bonds of 200_, Series __ then outstanding, payment of principal of and interest on any Bond of 19 __, Series __ of which such purchaser or its nominee or such other institutional investor or its nominee is the registered holder shall be made, without presentation thereof, by check payable to the order of such holder mailed to its address as it appears on the Bond Register maintained in accordance with (S)1.02 hereof on the Interest Payment Date or (in the case of a redemption in part only of any Bond of 200_, Series __ of which such purchaser or its nominee or such other institutional investor or its nominee is the registered holder) the Redemption Date, as the case may be, or to such other person and address and by such other manner as may be specified by such purchaser or other institutional investor in Schedule 1 to the Purchase Agreements, or otherwise, in a written order filed with the Company at least five days prior to the Interest Payment Date or (in the case of a redemption in part only of any Bond of 200_, Series __ of which such purchaser or its nominee or such other institutional investor or its nominee is the registered holder) the Redemption Date, as the case may be. As a condition to making any such payment, there shall be filed with the Trustee by such purchaser or other institutional investor an agreement (designating its nominee or nominees, if any, and which, in the case of such purchaser, shall be a copy of its Purchase Agreement referred to in the penultimate paragraph of this (S)1.05) that prior to the delivery by it upon disposition of any such Bond of 200_, Series __ so redeemed in part it will make an appropriate endorsement thereon as to all payments on account of principal thereof.] [The indemnity agreement of any such purchaser or any such other institutional investor, without security therefor, shall constitute sufficient indemnity to the Company and the Trustee for the purposes of (S)1.11 of the Original Indenture.] -10- [Any provision of the Indenture or of the Bonds of 200_, Series __ to the contrary notwithstanding, so long as any such purchaser or its nominee shall be a registered holder of any of the Bonds of 200_, Series __ or any such institutional investor or its nominee shall be a registered holder of at least __% of the aggregate principal amount of the Bonds of 200_, Series __, then outstanding, in case of the redemption in part only of the Bonds of 200_, Series __, the Trustee shall prorate the principal amount of such Bonds to be redeemed among all such Bonds in proportion to the outstanding principal amount thereof (treating as one Bond all of the Bonds held by registered holders who are not such purchasers or institutional investors or who are such institutional investors and hold less than __% of the aggregate principal amount of the Bonds of 200_, Series __ then outstanding) and shall then designate for redemption particular Bonds of such series or portions thereof (of $1,000 or any integral multiple thereof) equal to the principal amount of Bonds to be redeemed so prorated; provided, however, that in any such prorating pursuant to this paragraph, the Trustee shall, according to such method as it shall deem proper in its discretion, make such adjustments by increasing or decreasing by not more than $1,000 the amount which would be allocable on the basis of exact proportion to any one or more Bonds, as may be required to provide that the principal amount so prorated shall be in each instance an integral multiple of $1,000; and provided, further, that, in case of such a redemption pursuant to the final sentence of the first paragraph of (S)1.04 hereof, the Trustee shall not prorate the principal amount of Bonds of 200_, Series __ to be so redeemed among all Bonds of such series but shall designate for redemption particular Bonds of such series or portions thereof (of $1,000 or any integral multiple thereof) held by any registered holder opting for such redemption in accordance with such holder's instructions contained in the notice of redemption given by such holder to the Trustee pursuant to the second paragraph of (S)1.04 hereof.] [In the case of any such purchaser or institutional investor which acquires Bonds of 200_, Series __, with funds of a separate account, as such term is defined in Section 3 of ERISA, or guaranteed fund, such holder shall, with respect to each such separate account or guaranteed fund, be treated as a separate registered holder of Bonds of 200_, Series __, for the purposes of the Indenture.] [As hereinabove used, the term "Underwriting Agreement" shall mean the [several] Underwriting Agreement[s], [each] dated ______, 200_, between the Company and the purchaser[s] named in Schedule I thereto providing for the original issuance and sale by the Company of the Bonds of 200_, Series __, true and correct copies of such Underwriting Agreement, certified as such by the Corporate Secretary or an Assistant Corporate Secretary of the Company, having been lodged with the Trustee and being available for inspection at its principal corporate trust office.] [No supplemental indenture entered into pursuant to (S)14.01 of the Original Indenture shall amend or otherwise modify any provision contained in this (S)1.05 without the consent of all the holders of Bonds of 200_, Series __ whose rights or obligations under this (S)1.05 would be affected by such amendment or modification; nor shall any default by the Company in the performance of its obligations under this (S)1.05, and the consequences thereof, be waived pursuant to (S)7.24 of the Original Indenture, without like consent.] [(S)1.06. The Company covenants that on depositing or leaving with the Trustee funds for the payment of the principal and premium (if any) and interest on any Bonds of 200_, Series ___ -11- when the same become due, either at maturity or otherwise, [or at the date fixed for redemption thereof, pursuant to (S)3.03 or (S)10.03 of the Original Indenture], it will make effective arrangements with the Trustee whereby such funds will be immediately available for payment to the holder of such Bonds, and prior to, or within 5 days after, so depositing or leaving such funds, will give a notice, to be given as in the case of a notice of redemption of Bonds of 200_, Series __, stating that such funds have been or will be deposited or left with the Trustee and are or thereupon will be immediately so available for payment to the holders of such Bonds and, as full compliance with this Section, shall deliver to the Trustee proof satisfactory to the Trustee that such notice has been given, or that arrangements have been made insuring that such notice will be given, or a written instrument executed by the Company under its corporate seal, and expressed to be irrevocable, authorizing the Trustee to give such notice for and on behalf of the Company. In the case of a redemption of Bonds of 200_, Series __, such notice may be a part of any redemption notice published or given prior to or within such 5-day period after any such deposit or leaving of such funds.] ARTICLE 2. PROVISIONS SUPPLEMENTING THE MORTGAGE. (S)2.01. [Insert applicable provisions.]] ARTICLE 3. ADDITIONAL COVENANTS OF THE COMPANY. (S)3.01. [Insert applicable provisions.]] ARTICLE [4]. MISCELLANEOUS PROVISIONS. (S)[4].01. All references herein to any article, section or provision of the Original Indenture or any supplemental indenture refer to such article, section or provision as heretofore supplemented and modified and as hereby further supplemented and modified, unless, in any case, the context otherwise requires. Terms used but not defined herein are used as defined in the Mortgage. (S)[4].02. The recitals in this Eighty-Sixth Supplemental Indenture except the recital of the succession of The Chase Manhattan Bank (National Association) (formerly The Chase Manhattan Bank) to The Chase National Bank of the City of New York are made by the Company only and not by the Trustee, and all of the provisions contained in the Mortgage in respect of the rights, privileges, immunities, powers and duties of the Trustee shall be applicable in respect of the Bonds of 200_, Series __ and of this Eighty-Sixth Supplemental Indenture as fully and with like effect as if set forth herein in full. (S)[4].03. As heretofore supplemented and modified and as supplemented hereby, the Original Indenture is in all respects ratified and confirmed, and the Original Indenture, as -12- heretofore supplemented and modified, and this Eighty-Sixth Supplemental Indenture shall be read, taken and construed as one and the same instrument. (S)[4].04. Although this Eighty-Sixth Supplemental Indenture is dated for convenience and for the purpose of reference _____ __, ____, the actual dates of execution by the Company and by the Trustee are indicated by their respective acknowledgements hereto annexed. (S)[4].05. In order to facilitate the recording or filing of this Eighty- Sixth Supplemental Indenture, it may be simultaneously 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. -13- IN WITNESS WHEREOF, each party hereto has caused this instrument to be signed in its name and behalf, and its corporate seal to be hereunto affixed and attested, by its duly authorized officers, all as of the day and year first above written. VIRGINIA ELECTRIC AND POWER COMPANY, [SEAL] By Vice President Attest: Assistant Corporate Secretary THE CHASE MANHATTAN BANK (NATIONAL ASSOCIATION), [SEAL] By Vice President Attest: Assistant Secretary -14- COMMONWEALTH OF VIRGINIA:) ) SS.: CITY OF RICHMOND:) I, __________, a notary public duly qualified, commissioned, sworn and acting in and for the City and Commonwealth aforesaid, hereby certify that on this _____ day of______, 200_: (Virginia)_____________ and _________________, whose names as Vice (Maryland) President and Assistant Corporate Secretary of VIRGINIA ELECTRIC AND POWER COMPANY, a corporation, are signed to the writing above, bearing date on the _____ day of ______, 200_ have acknowledged the same before me in my City aforesaid; and (West Virginia) ______________, who signed the writing above and hereto annexed bearing date on the ____ day of ______, ____ for VIRGINIA ELECTRIC AND POWER COMPANY, has in my said City, before me, acknowledged said writing to be the act and deed of said corporation; and (North Carolina) ______________ personally came before me and acknowledged that he is Assistant Corporate Secretary of VIRGINIA ELECTRIC AND POWER COMPANY, a corporation, and that, by authority duly given and as the act of the corporation, the foregoing instrument was signed in its name by a Vice President, sealed with its corporate seal, and attested by himself as its Assistant Corporate Secretary. My commission expires: ____________, ____ IN WITNESS WHEREOF, I have hereunto set my hand and official seal this ____day of _________, ____. Notary Public [SEAL] -15- STATE OF NEW YORK:) ) SS.: COUNTY OF NEW YORK:) I, _________, a notary public duly qualified, commissioned, sworn and acting in and for the County and State aforesaid, hereby certify that on this ____ day of _______, ____: (Virginia) ___________ and ___________, whose names as Vice President and (Maryland) Assistant Secretary of THE CHASE MANHATTAN BANK (NATIONAL ASSOCIATION), a corporation, are signed to the writing above, bearing date on the ____ day of _____ , ____ have acknowledged the same before me in my County aforesaid; and (West Virginia)__________, who signed the writing above and hereto annexed bearing date on the ____ day of _______, ____ for THE CHASE MANHATTAN BANK (NATIONAL ASSOCIATION), has in my said County, before me, acknowledged said writing to be the act and deed of said corporation; and (North Carolina) _____________ personally came before me and acknowledged that he is Assistant Secretary of THE CHASE MANHATTAN BANK (NATIONAL ASSOCIATION), a corporation, and that, by authority duly given and as the act of the corporation, the foregoing instrument was signed in its name by a Vice President, sealed with its corporate seal, and attested by himself as its Assistant Secretary. My commission expires: _________, ____ IN WITNESS WHEREOF, I have hereunto set my hand and official seal this ______ day of _________, ____. Notary Public [SEAL] -16- EX-4.X 10 0010.txt GUARANTEE AGREEMENT TO BE DELIVERED Exhibit 4(x) Form of Guarantee Agreement GUARANTEE AGREEMENT DATED AS OF __________, 2000 BY AND BETWEEN VIRGINIA ELECTRIC AND POWER COMPANY AS GUARANTOR AND THE CHASE MANHATTAN BANK, AS TRUSTEE CROSS REFERENCE TABLE* SECTION OF TRUST SECTION OF INDENTURE ACT OF GUARANTEE 1939, AS AMENDED AGREEMENT - ---------------- --------- 310(a)......................................................... 4.1(a) 310(b)......................................................... 2.8; 4.1(c) 310(c)......................................................... Inapplicable 311(a)......................................................... 2.2(b) 311(b)......................................................... 2.2(b) 311(c)......................................................... Inapplicable 312(a)......................................................... 2.2(a); 2.9 312(b)......................................................... 2.2(b); 2.9 312(c)......................................................... 2.9 313(a)......................................................... 2.3 313(b)......................................................... 2.3 313(c)......................................................... 2.3 313(d)......................................................... 2.3 314(a)......................................................... 2.4 314(b)......................................................... Inapplicable 314(c)......................................................... 2.5 314(d)......................................................... Inapplicable 314(e)......................................................... 2.5 314(f)......................................................... Inapplicable 315(a)......................................................... 3.1(d); 3.2(a) 315(b)......................................................... 2.7(a) 315(c)......................................................... 3.1(c) 315(d)......................................................... 3.1(d) 316(a)......................................................... 2.6; 5.4(a) 316(b)......................................................... 5.3 316(c)......................................................... Inapplicable 317(a)......................................................... 2.10 317(b)......................................................... Inapplicable 318(a)......................................................... 2.1(b) - -------- * THIS CROSS-REFERENCE TABLE DOES NOT CONSTITUTE PART OF THE AGREEMENT AND SHALL NOT HAVE ANY BEARING UPON THE INTERPRETATION OF ANY OF ITS TERMS OR PROVISIONS. TABLE OF CONTENTS
PAGE ARTICLE 1 INTERPRETATION AND DEFINITIONS.................................................................... 2 SECTION 1.1 Interpretation and Definitions........................................................... 2 ARTICLE 2 TRUST INDENTURE ACT............................................................................... 6 SECTION 2.1 Trust Indenture Act; Application......................................................... 6 SECTION 2.2 Lists of Holders of Securities........................................................... 6 SECTION 2.3 Reports by Guarantee Trustee............................................................. 6 SECTION 2.4 Periodic Reports to Guarantee Trustee.................................................... 7 SECTION 2.5 Evidence of Compliance with Conditions Precedent......................................... 7 SECTION 2.6 Guarantee Event of Default; Waiver....................................................... 7 SECTION 2.7 Guarantee Event of Default; Notice....................................................... 7 SECTION 2.8 Conflicting Interests.................................................................... 7 SECTION 2.9 Disclosure of Information................................................................ 8 SECTION 2.10 Guarantee Trustee May File Proofs of Claim.............................................. 8 ARTICLE 3 POWERS, DUTIES AND RIGHTS OF GUARANTEE TRUSTEE.................................................... 8 SECTION 3.1 Powers and Duties of Guarantee Trustee................................................... 8 SECTION 3.2 Certain Rights of Guarantee Trustee...................................................... 10 SECTION 3.3 Not Responsible for Recitals or Issuance of Guarantee.................................... 12 ARTICLE 4 GUARANTEE TRUSTEE................................................................................. 12 SECTION 4.1 Guarantee Trustee; Eligibility........................................................... 12 SECTION 4.2 Appointment, Removal and Resignation of Guarantee Trustee................................ 12 ARTICLE 5 GUARANTEE......................................................................................... 13 SECTION 5.1 Guarantee................................................................................ 13 SECTION 5.2 Waiver of Notice and Demand.............................................................. 14 SECTION 5.3 Obligations Not Affected................................................................. 14 SECTION 5.4 Rights of Holders........................................................................ 15 SECTION 5.5 Guarantee of Payment..................................................................... 16 SECTION 5.6 Subrogation.............................................................................. 16 SECTION 5.7 Independent Obligations.................................................................. 16 ARTICLE 6 LIMITATION OF TRANSACTIONS; SUBORDINATION......................................................... 16 SECTION 6.1 Limitation of Transactions............................................................ 16 SECTION 6.2 Ranking............................................................................... 17 SECTION 6.3 Subordination of Common Securities.................................................... 17 ARTICLE 7 TERMINATION....................................................................................... 17 SECTION 7.1 Termination........................................................................... 17
i ARTICLE 8 INDEMNIFICATION.................................................................................... 18 SECTION 8.1 Exculpation............................................................................ 18 SECTION 8.2 Compensation, Expenses and Indemnification............................................. 18 ARTICLE 9 MISCELLANEOUS...................................................................................... 19 SECTION 9.1 Successors and Assigns................................................................. 19 SECTION 9.2 Amendments............................................................................. 19 SECTION 9.3 Notices................................................................................ 19 SECTION 9.4 Benefit................................................................................ 20 SECTION 9.5 Governing Law.......................................................................... 20
ii GUARANTEE AGREEMENT This GUARANTEE AGREEMENT (the "Guarantee"), dated as of _______, ____, is executed and delivered by VIRGINIA ELECTRIC AND POWER COMPANY, a Virginia corporation (the "Guarantor"), and THE CHASE MANHATTAN BANK, a New York banking corporation, as trustee (the "Guarantee Trustee"), for the benefit of the Holders (as defined herein) from time to time of the Securities (as defined herein) of VIRGINIA POWER CAPITAL TRUST II, a Delaware statutory business trust (the "Trust"). RECITALS WHEREAS, pursuant to the Trust Agreement (as defined herein), the Trust is issuing on the date hereof $___,___,___ aggregate liquidation amount of trust preferred securities, having a liquidation amount of $__ per security and designated the "____% Trust Preferred Securities" [OR INSERT OTHER DESIGNATION] of the Trust (the "Trust Preferred Securities") and $_________ aggregate liquidation amount of common securities, having a liquidation amount of $__ per security and designated the "____% Common Securities" of the Trust (the "Common Securities" and, together with the Trust Preferred Securities, the "Initial Securities"); [WHEREAS, pursuant to the Amended and Restated Trust Agreement, the Trust and Virginia Electric and Power Company, as Sponsor, have granted an Option (as defined in Section 7.13(a) of the Trust Agreement) to certain underwriters or initial purchasers, as the case may be, and such Option may be exercised on or within [30] days after the initial Closing Date (as defined in the Trust Agreement) such that an additional $_________ aggregate liquidation amount of Trust Preferred Securities (the "Option Trust Preferred Securities") and an additional $__________ aggregate liquidation amount of Common Securities (together with the Initial Securities and the Option Trust Preferred Securities, the "Securities") may be issued and sold pursuant to Sections 7.13(a) and (b) of the Trust Agreement on such initial or second Closing Date, as the case may be; PROVIDED that if the Option is not exercised by the underwriters or the initial purchasers, as the case may be, then the defined term the "Securities" shall mean only the Initial Securities;] WHEREAS, as incentive for the Holders to purchase the Securities, the Guarantor desires irrevocably and unconditionally to agree, to the extent set forth in this Guarantee, to pay to the Holders of the Securities the Guarantee Payments (as defined herein) and to make certain other payments on the terms and conditions set forth herein; and WHEREAS, if a Trust Enforcement Event (as defined herein) has occurred and is continuing, the rights of holders of the Common Securities to receive Guarantee Payments (as defined herein) under this Guarantee are subordinated to the rights of Holders of Trust Preferred Securities to receive Guarantee Payments under this Guarantee; NOW, THEREFORE, in consideration of the purchase by each Holder of Securities, which purchase the Guarantor hereby agrees shall benefit the Guarantor, the Guarantor executes and delivers this Guarantee for the benefit of the Holders. ARTICLE 1 INTERPRETATION AND DEFINITIONS SECTION 1.1 INTERPRETATION AND DEFINITIONS. In this Guarantee, unless the context otherwise requires: (a) capitalized terms used in this Guarantee but not defined in the preamble above have the respective meanings assigned to them in this Section 1.1; (b) a term defined anywhere in this Guarantee has the same meaning throughout; (c) all references to "the Guarantee" or "this Guarantee" are to this Guarantee as modified, supplemented or amended from time to time; (d) all references in this Guarantee to Articles, Sections and Recitals are to Articles, Sections and Recitals of this Guarantee, unless otherwise specified; (e) unless otherwise defined in this Guarantee, a term defined in the Trust Indenture Act has the same meaning when used in this Guarantee; (f) a reference to the singular includes the plural and vice versa and a reference to any masculine form of a term shall include the feminine form of a term, as applicable; and (g) the following terms have the following meanings: "AFFILIATE" has the same meaning as given to that term in Rule 405 of the Securities Act of 1933, as amended, or any successor rule thereunder. "BUSINESS DAY" has the meaning specified in the Trust Agreement. "COMMON SECURITIES" has the meaning specified in the Recitals hereto. "CORPORATE TRUST OFFICE" means the office of the Guarantee Trustee at which at any particular time its corporate trust business shall be principally administered, 2 which office at the date of execution of this Guarantee is located at 450 West 33rd Street, New York, New York 10001, Attention: Capital Markets Fiduciary Services. "COVERED PERSON" means a Holder or beneficial owner of Securities. "GLOBAL SECURITY" means a fully registered, global Preferred Security representing the Trust Preferred Securities. "GUARANTEE EVENT OF DEFAULT" means a default by the Guarantor on any of its payment or other obligations under this Guarantee. "GUARANTEE PAYMENTS" means the following payments or distributions, without duplication, with respect to the Securities, to the extent not paid by or on behalf of the Trust: (i) any accumulated and unpaid Distributions (as defined in the Trust Agreement) that are required to be paid on such Securities to the extent the Trust has sufficient funds available therefor at the time, (ii) the Redemption Price, including all accumulated and unpaid Distributions to the date of redemption, with respect to any Securities called for redemption by the Trust, to the extent the Trust shall have sufficient funds available therefor at the time or (iii) upon a voluntary or involuntary dissolution, winding-up or termination of the Trust (other than in connection with the distribution of Junior Subordinated Notes to the Holders in exchange for Securities as provided in the Trust Agreement), the lesser of (a) the aggregate of the liquidation amount and all accumulated and unpaid Distributions on the Securities to the date of payment, to the extent the Trust has sufficient funds available therefor and (b) the amount of assets of the Trust remaining available for distribution to Holders in liquidation of the Trust (in either case, the "Liquidation Distribution"). "GUARANTEE TRUSTEE" means The Chase Manhattan Bank, until a successor Guarantee Trustee has been appointed and has accepted such appointment pursuant to the terms of this Guarantee and thereafter means each such Successor Guarantee Trustee. "HOLDER" means any holder of Securities, as registered on the books and records of the Trust; provided, however, that, in determining whether the Holders of the requisite percentage of Trust Preferred Securities have given any request, notice, consent or waiver hereunder, "Holder" shall not include the Guarantor or any Affiliate of the Guarantor or any other obligor on the Trust Preferred Securities; and provided further that in determining whether the Holders of the requisite liquidation amount of Trust Preferred Securities have voted on any matter provided for in this Guarantee, then for the purpose of such determination only (and not for any other purpose hereunder), if the Trust Preferred Securities remain in the form of one or more Global Certificates (as defined in the Trust Agreement) and if the Depositary which is the holder of such Global Securities has sent an omnibus proxy to the Trust assigning voting rights to Depositary Participants (as defined in the Trust Agreement) to whose accounts the Trust Preferred Securities are credited on the record date, the term "Holders" shall mean such Depositary 3 Participants acting at the direction of the Beneficial Owners (as defined in the Trust Agreement). "INDEMNIFIED PERSON" means the Guarantee Trustee, any Affiliate of the Guarantee Trustee, or any officers, directors, shareholders, members, partners, employees, representatives, nominees, custodians or agents of the Guarantee Trustee. "INDENTURE" means the Subordinated Note Indenture, dated as of August 1, 1995, by and between Virginia Electric and Power Company and. and The Chase Manhattan Bank as Trustee, as supplemented and amended by a First Supplemental Indenture dated as of August 1, 1995 and as further amended or supplemented by any other indenture supplemental thereto, pursuant to which the Junior Subordinated Notes are to be issued to the Property Trustee as defined in the Trust Agreement. "JUNIOR SUBORDINATED Notes" means the series of junior subordinated notes to be issued by Virginia Electric and Power Company designated the "____% Junior Subordinated Notes due ____" held by the Property Trustee as defined in the Trust Agreement. "LIST OF HOLDERS" has the meaning assigned to it in Section 2.2 hereof. "MAJORITY IN LIQUIDATION AMOUNT" means, except as provided in the terms of the Trust Preferred Securities or by the Trust Indenture Act, Holder(s) of outstanding Securities, voting together as a single class, or, as the context may require, Holders of outstanding Trust Preferred Securities or Holders of outstanding Common Securities, voting separately as a class, who are the record owners of more than 50% of the aggregate liquidation amount (including the stated amount that would be paid on redemption, liquidation or otherwise, plus accumulated and unpaid Distributions to the date upon which the voting percentages are determined) of all outstanding Securities of the relevant class. In determining whether the Holders of the requisite amount of Securities have voted, Securities which are owned by the Guarantor or any Affiliate of the Guarantor or any other obligor on the Securities shall be disregarded for the purpose of any such determination. "OFFICERS' CERTIFICATE" means, with respect to any Person, a certificate signed on behalf of such Person by two Authorized Officers (as defined in the Trust Agreement) of such Person. Any Officers' Certificate delivered with respect to compliance with a condition or covenant provided for in this Guarantee (other than pursuant to Section 314(a)(4) of the Trust Indenture Act) shall include: (a) a statement that each officer signing the Officers' Certificate has read the covenant or condition and the definitions relating thereto; (b) a brief statement of the nature and scope of the examination or investigation undertaken by each officer on behalf of such Person in rendering the Officers' Certificate; 4 (c) a statement that each such officer has made such examination or investigation as, in such officer's opinion, is necessary to enable such officer on behalf of such Person to express an informed opinion as to whether or not such covenant or condition has been complied with; and (d) a statement as to whether, in the opinion of each such officer acting on behalf of such Person, such condition or covenant has been complied with. "PERSON" means a legal person, including any individual, corporation, estate, partnership, joint venture, association, joint stock company, limited liability company, trust, unincorporated association, or government or any agency or political subdivision thereof, or any other entity of whatever nature. "REDEMPTION PRICE" has the meaning specified in the Trust Agreement. "RESPONSIBLE OFFICER" means, with respect to the Guarantee Trustee, any officer with direct responsibility for the administration of this Guarantee and also means, with respect to a particular corporate trust matter, any other officer to whom such matter is referred because of that officer's knowledge of and familiarity with the particular subject. "SECURITIES" has the meaning specified in the Recitals hereto. "SUCCESSOR GUARANTEE TRUSTEE" means a successor Guarantee Trustee possessing the qualifications to act as Guarantee Trustee under Section 4.1. "TRUST AGREEMENT" means the Amended and Restated Trust Agreement, dated as of __________ __, 200_, as amended, modified or supplemented from time to time, among the trustees of the Trust named therein, the Guarantor, as sponsor, and the Holders, from time to time, of undivided beneficial ownership interests in the assets of the Trust. "TRUST ENFORCEMENT EVENT" in respect of the Securities means an Event of Default (as defined in the Indenture) has occurred and is continuing in respect of the Junior Subordinated Notes. "TRUST INDENTURE ACT" means the Trust Indenture Act of 1939, as amended from time to time, or any successor legislation. "TRUST PREFERRED SECURITIES" has the meaning specified in the Recitals hereto, and shall include the Trust Preferred Securities constituting Initial Securities and the Option Trust Preferred Securities. 5 ARTICLE 2 TRUST INDENTURE ACT SECTION 2.1 TRUST INDENTURE ACT; APPLICATION. (a) This Guarantee is subject to the provisions of the Trust Indenture Act that are required to be part of this Guarantee and shall, to the extent applicable, be governed by such provisions. (b) If and to the extent that any provision of this Guarantee limits, qualifies or conflicts with the duties imposed by Sections 310 to 317, inclusive, of the Trust Indenture Act, such imposed duties shall control. SECTION 2.2 LISTS OF HOLDERS OF SECURITIES. (a) The Guarantor shall provide the Guarantee Trustee (i) except while the Trust Preferred Securities are represented by one or more Global Securities at least one Business Day prior to the date for payment of Distributions, a list, in such form as the Guarantee Trustee may reasonably require, of the names and addresses of the Holders of the Securities ("List of Holders") as of the record date relating to the payment of such Distributions, and (ii) at any other time, within 30 days of receipt by the Guarantor of a written request from the Guarantee Trustee for a List of Holders as of a date no more than 15 days before such List of Holders is given to the Guarantee Trustee, excluding from any such list names and addresses received by the Guarantee Trustee in its capacity as Security Registrar; provided that the Guarantor shall not be obligated to provide such List of Holders at any time the List of Holders does not differ from the most recent List of Holders given to the Guarantee Trustee by the Guarantor. The Guarantee Trustee shall preserve, in as current a form as is reasonably practicable, all information contained in Lists of Holders given to it, provided that the Guarantee Trustee may destroy any List of Holders previously given to it on receipt of a new List of Holders. (b) The Guarantee Trustee shall comply with its obligations under Sections 311(a), 311(b) and 312(b) of the Trust Indenture Act. SECTION 2.3 REPORTS BY GUARANTEE TRUSTEE. Within 60 days after May 15 of each year (commencing with the year of the first anniversary of the issuance of the Securities), the Guarantee Trustee shall provide to the Holders of the Securities such reports as are required by Section 313(a) of the Trust Indenture Act (if any) in the form and in the manner provided by Section 313 of the Trust Indenture Act. The Guarantee Trustee shall also comply with the other requirements of Section 313 of the Trust Indenture Act. The Guarantor shall promptly notify the Guarantee Trustee when the Securities are listed on any stock exchange. 6 SECTION 2.4 PERIODIC REPORTS TO GUARANTEE TRUSTEE. The Guarantor shall provide to the Guarantee Trustee such documents, reports and information as required by Section 314(a) (if any) of the Trust Indenture Act and the compliance certificate required by Section 314(a)(4) of the Trust Indenture Act in the form, in the manner and at the times required by Section 314(a) of the Trust Indenture Act, provided that such compliance certificate shall be delivered on or before 120 days after the end of each calendar year of the Guarantor. SECTION 2.5 EVIDENCE OF COMPLIANCE WITH CONDITIONS PRECEDENT. The Guarantor shall provide to the Guarantee Trustee such evidence of compliance with any conditions precedent, if any, provided for in this Guarantee that relate to any of the matters set forth in Section 314(c) of the Trust Indenture Act. Any certificate or opinion required to be given by an officer pursuant to Section 314(c)(1) may be given in the form of an Officers' Certificate. SECTION 2.6 GUARANTEE EVENT OF DEFAULT; WAIVER. The Holders of a Majority in Liquidation Amount of the Securities may, by vote or written consent, on behalf of the Holders of all of the Securities, waive any past Guarantee Event of Default and its consequences. Upon such waiver, any such Guarantee Event of Default shall cease to exist, and any Guarantee Event of Default arising therefrom shall be deemed to have been cured, for every purpose of this Guarantee, but no such waiver shall extend to any subsequent or other default or Guarantee Event of Default or impair any right consequent thereon. SECTION 2.7 GUARANTEE EVENT OF DEFAULT; NOTICE. (a) The Guarantee Trustee shall, within 90 days after the occurrence of a Guarantee Event of Default actually known to a Responsible Officer of the Guarantee Trustee, transmit by mail, first class postage prepaid, to the Holders of the Securities, notices of all such Guarantee Events of Default, unless such defaults have been cured before the giving of such notice; provided, that the Guarantee Trustee shall be protected in withholding such notice if and so long as a Responsible Officer of the Guarantee Trustee in good faith determines that the withholding of such notice is in the interests of the Holders of the Securities. (b) The Guarantee Trustee shall not be deemed to have knowledge of any Guarantee Event of Default unless the Guarantee Trustee shall have received written notice thereof from the Guarantor or a Holder or a Responsible Officer of the Guarantee Trustee charged with the administration of this Guarantee shall have obtained actual knowledge thereof. SECTION 2.8 CONFLICTING INTERESTS. The Trust Agreement, the Amended and Restated Trust Agreement of Virginia Power Capital Trust I dated as of August 31, 1995, among the Guarantor, as Depositor, The Chase Manhattan Bank (formerly known as Chemical Bank), as Property Trustee, Chase Manhattan Bank Delaware (formerly known as Chemical Bank Delaware), as Delaware Trustee and the 7 Administrative Trustees named therein, and the Guarantee Agreement, relating to Virginia Power Corporate Trust I dated as of August 31, 1995, between the Guarantor and The Chase Manhattan Bank (formerly known as Chemical Bank), as Guarantee Trustee shall be deemed to be specifically described in this Guarantee for the purposes of clause (i) of the first proviso contained in Section 310(b) of the Trust Indenture Act. SECTION 2.9 DISCLOSURE OF INFORMATION. The disclosure of information as to the names and addresses of the Holders of the Securities in accordance with Section 312 of the Trust Indenture Act, regardless of the source from which such information was derived, shall not be deemed to be a violation of any existing law, or any law hereafter enacted which does not specifically refer to Section 312 of the Trust Indenture Act, nor shall the Guarantee Trustee be held accountable by reason of mailing any material pursuant to a request made under Section 312(b) of the Trust Indenture Act. SECTION 2.10 GUARANTEE TRUSTEE MAY FILE PROOFS OF CLAIM. Upon the occurrence of a Guarantee Event of Default, the Guarantee Trustee is hereby authorized to (a) recover judgment, in its own name and as trustee of an express trust, against the Guarantor for the whole amount of any Guarantee Payments remaining unpaid and (b) file such proofs of claim and other papers or documents as may be necessary or advisable in order to have its claims and those of the Holders of the Securities allowed in any judicial proceedings relative to the Guarantor, its creditors or its property. ARTICLE 3 POWERS, DUTIES AND RIGHTS OF GUARANTEE TRUSTEE SECTION 3.1 POWERS AND DUTIES OF GUARANTEE TRUSTEE. (a) This Guarantee shall be held by the Guarantee Trustee on behalf of the Trust for the benefit of the Holders of the Securities, and the Guarantee Trustee shall not transfer this Guarantee to any Person except a Holder of Securities exercising his or her rights pursuant to Section 5.4(b) or to a Successor Guarantee Trustee on acceptance by such Successor Guarantee Trustee of its appointment to act as Successor Guarantee Trustee. The right, title and interest of the Guarantee Trustee in and to this Guarantee shall automatically vest in any Successor Guarantee Trustee, and such vesting and succession of title shall be effective whether or not conveyance documents have been executed and delivered pursuant to the appointment of such Successor Guarantee Trustee. (b) If a Guarantee Event of Default actually known to a Responsible Officer of the Guarantee Trustee has occurred and is continuing, the Guarantee Trustee shall be entitled to enforce this Guarantee for the benefit of the Holders of the Securities. (c) The Guarantee Trustee, before the occurrence of any Guarantee Event of Default and after the curing of all Guarantee Events of Default that may have occurred, shall undertake to perform only such duties as are specifically set forth in this Guarantee, 8 and no implied covenants shall be read into this Guarantee against the Guarantee Trustee. In case a Guarantee Event of Default has occurred (that has not been cured or waived pursuant to Section 2.6) and is actually known to a Responsible Officer of the Guarantee Trustee, the Guarantee Trustee shall exercise such of the rights and powers vested in it by this Guarantee, and use the same degree of care and skill in its exercise thereof, as a prudent person would exercise or use under the circumstances in the conduct of his or her own affairs. (d) No provision of this Guarantee shall be construed to relieve the Guarantee Trustee from liability for its own negligent action, its own negligent failure to act, or its own willful misconduct, except that: (i) prior to the occurrence of any Guarantee Event of Default and after the curing or waiving of all such Guarantee Events of Default that may have occurred: (A) the duties and obligations of the Guarantee Trustee shall be determined solely by the express provisions of this Guarantee, and the Guarantee Trustee shall not be liable except for the performance of such duties and obligations as are specifically set forth in this Guarantee, and no implied covenants or obligations shall be read into this Guarantee against the Guarantee Trustee; and (B) in the absence of bad faith on the part of the Guarantee Trustee, the Guarantee Trustee may conclusively rely, as to the truth of the statements and the correctness of the opinions expressed therein, upon any certificates or opinions furnished to the Guarantee Trustee and conforming to the requirements of this Guarantee; but in the case of any such certificates or opinions that by any provision hereof are specifically required to be furnished to the Guarantee Trustee, the Guarantee Trustee shall be under a duty to examine the same to determine whether or not they conform to the requirements of this Guarantee; (ii) the Guarantee Trustee shall not be liable for any error of judgment made in good faith by a Responsible Officer of the Guarantee Trustee, unless it shall be proved that the Guarantee Trustee was negligent in ascertaining the pertinent facts upon which such judgment was made; (iii) the Guarantee Trustee shall not be liable with respect to any action taken or omitted to be taken by it in good faith in accordance with the direction of the Holders of not less than a Majority in Liquidation Amount of the Securities relating to the time, method and place of conducting any proceeding for any remedy available to the Guarantee Trustee, or exercising any trust or power conferred upon the Guarantee Trustee under this Guarantee; and 9 (iv) no provision of this Guarantee shall require the Guarantee Trustee to expend or risk its own funds or otherwise incur personal financial liability in the performance of any of its duties or in the exercise of any of its rights or powers, if the Guarantee Trustee shall have reasonable grounds for believing that the repayment of such funds or liability is not reasonably assured to it under the terms of this Guarantee or if the Guarantee Trustee shall have reasonable grounds for believing that an indemnity, reasonably satisfactory to the Guarantee Trustee, against such risk or liability is not reasonably assured to it under the terms of this Guarantee. SECTION 3.2 CERTAIN RIGHTS OF GUARANTEE TRUSTEE. (a) Subject to the provisions of Section 3.1: (i) The Guarantee Trustee may conclusively rely, and shall be fully protected in acting or refraining from acting upon, any resolution, certificate, statement, instrument, opinion, report, notice, request, direction, consent, order, bond, debenture, note, other evidence of indebtedness or other paper or document believed by it to be genuine and to have been signed, sent or presented by the proper party or parties; (ii) Any direction or act of the Guarantor contemplated by this Guarantee shall be sufficiently evidenced by an Officers' Certificate; (iii) Whenever, in the administration of this Guarantee, the Guarantee Trustee shall deem it desirable that a matter be proved or established before taking, suffering or omitting any action hereunder, the Guarantee Trustee (unless other evidence is herein specifically prescribed) may, in the absence of bad faith on its part, request and conclusively rely upon an Officers' Certificate which, upon receipt of such request, shall be promptly delivered by the Guarantor; (iv) The Guarantee Trustee shall have no duty to see to any recording, filing or registration or any instrument (or any rerecording, refiling or re-registration thereof); (v) The Guarantee Trustee may consult with counsel, and the advice or opinion of such counsel with respect to legal matters shall be full and complete authorization and protection in respect of any action taken, suffered or omitted by it hereunder in good faith and in accordance with such advice or opinion. Such counsel may be counsel to the Guarantor or any of its Affiliates and may include any of its employees. The Guarantee Trustee shall have the right at any time to seek instructions concerning the administration of this Guarantee from any court of competent jurisdiction; (vi) The Guarantee Trustee shall be under no obligation to exercise any of the rights or powers vested in it by this Guarantee at the request or direction of 10 any Holder, unless such Holder shall have provided to the Guarantee Trustee such security and indemnity, reasonably satisfactory to the Guarantee Trustee, against the costs, expenses (including attorneys' fees and expenses and the expenses of the Guarantee Trustee's agents, nominees or custodians) and liabilities that might be incurred by it in complying with such request or direction, including such reasonable advances as may be requested by the Guarantee Trustee; provided, that nothing contained in this Section 3.2(a)(vi) shall be taken to relieve the Guarantee Trustee, upon the occurrence of a Guarantee Event of Default, of its obligation to exercise the rights and powers vested in it by this Guarantee in the manner provided by Section 3.1(c); (vii) The Guarantee Trustee shall not be bound to make any investigation into the facts or matters stated in any resolution, certificate, statement, instrument, opinion, report, notice, request, direction, consent, order, bond, debenture, note, other evidence of indebtedness or other paper or document, but the Guarantee Trustee, in its discretion, may make such further inquiry or investigation into such facts or matters as it may see fit; (viii) The Guarantee Trustee may execute any of the trusts or powers hereunder or perform any duties hereunder either directly or by or through agents, nominees, custodians or attorneys, and the Guarantee Trustee shall not be responsible for any misconduct or negligence on the part of any agent or attorney appointed with due care by it hereunder; (ix) Any action taken by the Guarantee Trustee or its agents hereunder shall bind the Holders, and the signature of the Guarantee Trustee or its agents alone shall be sufficient and effective to perform any such action. No third party shall be required to inquire as to the authority of the Guarantee Trustee to so act or as to its compliance with any of the terms and provisions of this Guarantee, both of which shall be conclusively evidenced by the Guarantee Trustee's or its agent's taking such action; and (x) Whenever in the administration of this Guarantee, the Guarantee Trustee shall deem it desirable to receive instructions with respect to enforcing any remedy or right or taking any other action hereunder, the Guarantee Trustee (A) may request written instructions from the Holders of a Majority in Liquidation Amount of the Securities, (B) may refrain from enforcing such remedy or right or taking such other action until such written instructions are received and (C) shall be protected in conclusively relying on or acting in accordance with such written instructions. (b) No provision of this Guarantee shall be deemed to impose any duty or obligation on the Guarantee Trustee to perform any act or acts or exercise any right, power, duty or obligation conferred or imposed on it in any jurisdiction in which it shall be illegal, or in which the Guarantee Trustee shall be unqualified or incompetent to act in accordance with applicable law, to perform any such act or acts or to exercise any such 11 right, power, duty or obligation. No permissive power or authority available to the Guarantee Trustee shall be construed to be a duty. SECTION 3.3 NOT RESPONSIBLE FOR RECITALS OR ISSUANCE OF GUARANTEE. The recitals contained in this Guarantee shall be taken as the statements of the Guarantor, and the Guarantee Trustee does not assume any responsibility for their correctness. The Guarantee Trustee makes no representations as to the validity or sufficiency of this Guarantee. ARTICLE 4 GUARANTEE TRUSTEE SECTION 4.1 GUARANTEE TRUSTEE; ELIGIBILITY. (a) There shall be at all times a Guarantee Trustee which shall: (i) not be an Affiliate of the Guarantor; and (ii) be a corporation organized and doing business under the laws of the United States of America or any state or territory thereof or of the District of Columbia, or a corporation or other Person permitted by the Securities and Exchange Commission to act as an institutional trustee under the Trust Indenture Act, authorized under such laws to exercise corporate trust powers, having a combined capital and surplus of at least 50 million U.S. dollars ($50,000,000), and subject to supervision or examination by federal, state, territorial or District of Columbia authority. If such corporation publishes reports of condition at least annually, pursuant to law or to the requirements of the supervising or examining authority referred to above, then, for the purposes of this Section 4.1(a)(ii), the combined capital and surplus of such corporation shall be deemed to be its combined capital and surplus as set forth in its most recent report of condition so published. (b) If at any time the Guarantee Trustee shall cease to be eligible to so act under Section 4.1(a), the Guarantee Trustee shall immediately resign in the manner and with the effect set out in Section 4.2(c). (c) If the Guarantee Trustee has or shall acquire any "conflicting interest" within the meaning of Section 310(b) of the Trust Indenture Act, the Guarantee Trustee and Guarantor shall in all respects comply with the provisions of Section 310(b) of the Trust Indenture Act, subject to the penultimate paragraph thereof. 12 SECTION 4.2 APPOINTMENT, REMOVAL AND RESIGNATION OF GUARANTEE TRUSTEE. (a) Subject to Section 4.2(b), unless a Guarantee Event of Default shall have occurred and be continuing, the Guarantee Trustee may be appointed or removed with or without cause at any time by the Guarantor. If a Guarantee Event of Default has occurred and is continuing, the Guarantee Trustee may be appointed or removed by the Holders of a Majority in Liquidation Amount of the Trust Preferred Securities. (b) The Guarantee Trustee shall not be removed in accordance with Section 4.2(a) until a Successor Guarantee Trustee has been appointed and has accepted such appointment by written instrument executed by such Successor Guarantee Trustee and delivered to the Guarantor. (c) The Guarantee Trustee appointed to office shall hold such office until a Successor Guarantee Trustee shall have been appointed or until its removal or resignation. The Guarantee Trustee may resign from office (without need for prior or subsequent accounting) by an instrument in writing executed by the Guarantee Trustee and delivered to the Guarantor, which resignation shall not take effect until a Successor Guarantee Trustee has been appointed and has accepted such appointment by instrument in writing executed by such Successor Guarantee Trustee and delivered to the Guarantor and the resigning Guarantee Trustee. (d) If no Successor Guarantee Trustee shall have been appointed and accepted appointment as provided in this Section 4.2 within 60 days after delivery to the Guarantor of an instrument of removal or resignation, the removed or resigning Guarantee Trustee may petition any court of competent jurisdiction for appointment of a Successor Guarantee Trustee. Such court may thereupon, after prescribing such notice, if any, as it may deem proper, appoint a Successor Guarantee Trustee. (e) No Guarantee Trustee shall be liable for the acts or omissions to act of any Successor Guarantee Trustee. (f) Upon termination of this Guarantee or removal or resignation of the Guarantee Trustee pursuant to this Section 4.2, the Guarantor shall pay to the Guarantee Trustee all amounts owing for fees and reimbursement of expenses which have accrued to the date of such termination, removal or resignation. ARTICLE 5 GUARANTEE SECTION 5.1 GUARANTEE. 13 The Guarantor irrevocably and unconditionally agrees to pay in full to the Holders the Guarantee Payments (without duplication of amounts theretofore paid by the Trust), as and when due, regardless of any defense, right of set-off or counterclaim that the Trust may have or assert. The Guarantor's obligation to make a Guarantee Payment may be satisfied by direct payment of the required amounts by the Guarantor to the Holders or by causing the Trust to pay such amounts to the Holders. Notwithstanding anything to the contrary herein, the Guarantor retains all of its rights under the Indenture to (i) extend the interest payment period on the Junior Subordinated Notes pursuant to Section 4.1 of the Second Supplemental Indenture thereto and the Guarantor shall not be obligated hereunder to make any Guarantee Payments during any Extension Period (as defined in the certificate evidencing the Junior Subordinated Notes) with respect to the Distributions (as defined in the Trust Agreement) on the Securities and (ii) change the maturity date of the Junior Subordinated Notes to the extent permitted by the Indenture. SECTION 5.2 WAIVER OF NOTICE AND DEMAND. The Guarantor hereby waives notice of acceptance of this Guarantee and of any liability to which it applies or may apply, presentment, demand for payment, any right to require a proceeding first against the Trust or any other Person before proceeding against the Guarantor, protest, notice of nonpayment, notice of dishonor, notice of redemption and all other notices and demands. SECTION 5.3 OBLIGATIONS NOT AFFECTED. The obligations, covenants, agreements and duties of the Guarantor under this Guarantee shall be absolute and unconditional and shall remain in full force and effect until the entire liquidation amount of all outstanding Securities shall have been paid and such obligation shall in no way be affected or impaired by reason of the happening from time to time of any event, including without limitation, the following, whether or not with notice to, or the consent of, the Guarantor: (a) The release or waiver, by operation of law or otherwise, of the performance or observance by the Trust of any express or implied agreement, covenant, term or condition relating to the Securities to be performed or observed by the Trust; (b) The extension of time for the payment by the Trust of all or any portion of the Distributions, Redemption Price, Liquidation Distribution or any other sums payable under the terms of the Securities or the extension of time for the performance of any other obligation under, arising out of, or in connection with the Securities (other than an extension of time for payment of Distributions, Redemption Price, Liquidation Distribution or other sum payable that results from the extension of any interest payment period on the Junior Subordinated Notes or any change to the maturity date of the Junior Subordinated Notes permitted by the Indenture); (c) Any failure, omission, delay or lack of diligence on the part of the Property Trustee or the Holders to enforce, assert or exercise any right, privilege, power 14 or remedy conferred on the Property Trustee or the Holders pursuant to the terms of the Securities, or any action on the part of the Trust granting indulgence or extension of any kind; (d) The voluntary or involuntary liquidation, dissolution, sale of any collateral, receivership, insolvency, bankruptcy, assignment for the benefit of creditors, reorganization, arrangement, composition or readjustment of debt of, or other similar proceedings affecting, the Trust or any of the a sets of the Trust; (e) Any invalidity of, or defect or deficiency in, the Securities; (f) The settlement or compromise of any obligation guaranteed hereby or hereby incurred; or (g) Any other circumstance whatsoever that might otherwise constitute a legal or equitable discharge or defense of a guarantor, it being the intent of this Section 5.3 that the obligations of the Guarantor hereunder shall be absolute and unconditional under any and all circumstances. There shall be no obligation of the Guarantee Trustee or the Holders to give notice to, or obtain consent of the Guarantor or any other Person with respect to the happening of any of the foregoing. No setoff, counterclaim, reduction or diminution of any obligation, or any defense of any kind or nature that the Guarantor has or may have against any Holder shall be available hereunder to the Guarantor against such Holder to reduce the payments to it under this Guarantee. SECTION 5.4 RIGHTS OF HOLDERS. (a) The Holders of at least a Majority in Liquidation Amount of the Securities have the right to direct the time, method and place of conducting any proceeding for any remedy available to the Guarantee Trustee in respect of this Guarantee or to direct the exercise of any trust or power conferred upon the Guarantee Trustee under this Guarantee, provided, that, subject to Section 3.1, the Guarantee Trustee shall have the right to decline to follow any such direction if the Guarantee Trustee shall determine that the action so directed would be unjustly prejudicial to the Holders not taking part in such direction or if the Guarantee Trustee being advised by counsel determines that the action or proceeding so directed may not lawfully be taken or if the Guarantee Trustee in good faith by its board of directors or trustees, executive committee, or a trust committee of directors or trustees and/or Responsible Officers of the Guarantee Trustee shall determine that the action or proceedings so directed would involve the Guarantee Trustee in personal liability. (b) If the Guarantee Trustee fails to enforce this Guarantee, then any Holder of Securities may, subject to the subordination provisions of Section 6.2, institute a legal 15 proceeding directly against the Guarantor to enforce the Guarantee Trustee's rights under this Guarantee without first instituting a legal proceeding against the Trust, the Guarantee Trustee or any other person or entity. In addition, if the Guarantor has failed to make a Guarantee Payment, a Holder of Securities may, subject to the subordination provisions of Section 6.2, directly institute a proceeding against the Guarantor for enforcement of the Guarantee for such payment to the Holder of the Securities of the principal of or interest on the Junior Subordinated Notes on or after the respective due dates specified in the Junior Subordinated Notes, and the amount of the payment will be based on the Holder's pro rata share of the amount due and owing on all of the Securities. The Guarantor hereby waives any right or remedy to require that any action on this Guarantee be brought first against the Trust or any other person or entity before proceeding directly against the Guarantor. SECTION 5.5 GUARANTEE OF PAYMENT. This Guarantee creates a guarantee of payment and not of collection. SECTION 5.6 SUBROGATION. The Guarantor shall be subrogated to all (if any) rights of the Holders of Securities against the Trust in respect of any amounts paid to such Holders by the Guarantor under this Guarantee; provided, however, that the Guarantor shall not (except to the extent required by mandatory provisions of law) be entitled to enforce or exercise any right that it may acquire by way of subrogation or any indemnity, reimbursement or other agreement, in all cases as a result of payment under this Guarantee, if at the time of any such payment, any amounts are due and unpaid under this Guarantee. If any amount shall be paid to the Guarantor in violation of the preceding sentence, the Guarantor agrees to hold such amount in trust for the Holders and to pay over such amount to the Guarantee Trustee for the benefit of the Holders. SECTION 5.7 INDEPENDENT OBLIGATIONS. The Guarantor acknowledges that its obligations hereunder are independent of the obligations of the Trust with respect to the Securities, and that the Guarantor shall be liable as principal and as debtor hereunder to make Guarantee Payments pursuant to the terms of this Guarantee notwithstanding the occurrence of any event referred to in subsections 5.3(a) through 5.3(g), inclusive, hereof. ARTICLE 6 LIMITATION OF TRANSACTIONS; SUBORDINATION SECTION 6.1 LIMITATION OF TRANSACTIONS. 16 So long as any Securities remain outstanding, if (i) there shall have occurred an event of default under the Indenture with respect to the Junior Subordinated Notes, (ii) there shall be a Guarantee Event of Default or (iii) the Guarantor shall have given notice of its election of an Extension Period as provided in the certificate evidencing the Junior Subordinated Notes and shall not have rescinded such notice, or such Extension Period or any extension thereof shall be continuing, then the Guarantor shall not, and shall not permit any subsidiary of the Guarantor, to (x) declare or pay any dividends or distributions on, or redeem, purchase, acquire or make a liquidation payment with respect to, any of the Guarantor's capital stock or (y) make any payment of principal, interest or premium, if any, on or repay, repurchase or redeem any debt securities of the Guarantor that rank on a parity with or junior in interest to the Junior Subordinated Notes or make any guarantee payments with respect to any guarantee by the Guarantor of the debt securities of any subsidiary of the Guarantor if such guarantee ranks on a parity with or junior in interest to the Junior Subordinated Notes (other than (a) dividends or distributions in common stock of the Guarantor, (b) any declaration of a dividend in connection with the implementation of a shareholders' rights plan, or the issuance of stock under any such plan in the future, or the redemption or repurchase of any such rights pursuant thereto, (c) payments under this Guarantee, and (d) purchases of common stock related to the issuance of common stock or rights under any of the Guarantor's benefit plans). SECTION 6.2 RANKING. This Guarantee will constitute an unsecured obligation of the Guarantor and will rank subordinate and junior in right of payment to all Senior Indebtedness of the Company (as defined in the Indenture) of the Guarantor in the same manner and to the same extent as set forth in Article Thirteen of the Indenture. SECTION 6.3 SUBORDINATION OF COMMON SECURITIES. If a Trust Enforcement Event has occurred and is continuing under the Trust Agreement, the rights of the holders of the Common Securities to receive Guarantee Payments hereunder shall be subordinated to the rights of the Holders of the Trust Preferred Securities to receive Guarantee Payments under this Guarantee. ARTICLE 7 TERMINATION SECTION 7.1 TERMINATION. This Guarantee shall terminate upon (i) full payment of the Redemption Price of all Securities, (ii) distribution of the Junior Subordinated Notes to the Holders of all the Securities or (iii) full payment of the amounts payable in accordance with the Trust Agreement upon liquidation of the Trust. Notwithstanding the foregoing, this Guarantee 17 will continue to be effective or will be reinstated, as the case may be, if at any time any Holder of Securities must restore payment of any sums paid under the Securities or under this Guarantee. 18 ARTICLE 8 INDEMNIFICATION SECTION 8.1 EXCULPATION. (a) No Indemnified Person shall be liable, responsible or accountable in damages or otherwise to the Guarantor or any Covered Person for any loss, damage, liability, expense or claim incurred by reason of any act or omission performed or omitted by such Indemnified Person in good faith in accordance with this Guarantee and in a manner that such Indemnified Person reasonably believed to be within the scope of the authority conferred on such Indemnified Person by this Guarantee or by law, except that an Indemnified Person shall be liable for any such loss, damage or claim incurred by reason of such Indemnified Person's negligence or willful misconduct with respect to such acts or omissions. (b) An Indemnified Person shall be fully protected in relying in good faith upon the records of the Guarantor and upon such information, opinions, reports or statements presented to the Guarantor by any Person as to matters the Indemnified Person reasonably believes are within such other Person's professional or expert competence including information, opinions, reports or statements as to the value and amount of the assets, liabilities, profits, losses, or any other facts pertinent to the existence and amount of assets from which Distributions to Holders of Securities might properly be paid. SECTION 8.2 COMPENSATION, EXPENSES AND INDEMNIFICATION. (a) The Guarantor agrees to pay to the Guarantee Trustee from time to time reasonable compensation for all services rendered by it hereunder (which compensation shall not be limited by any provision of law in regard to the compensation of a trustee of an express trust) and to reimburse the Guarantee Trustee upon request for all reasonable expenses, disbursements and advances (including the reasonable fees and expenses of its attorneys and agents) incurred or made by the Guarantee Trustee in accordance with any provision of this Guarantee. (b) The Guarantor agrees to indemnify each Indemnified Person for, and to hold each Indemnified Person harmless against any loss, liability or expense incurred without negligence or bad faith on its part, arising out of or in connection with the acceptance or administration of the trust or trusts hereunder, including the costs and expenses (including reasonable legal fees and expenses) of defending itself against, or investigating, any claim or liability in connection with the exercise or performance of any of its powers or duties hereunder. (c) The obligations of the Guarantor under this Section 8.2 shall survive the termination of this Guarantee. 19 ARTICLE 9 MISCELLANEOUS SECTION 9.1 SUCCESSORS AND ASSIGNS. All guarantees and agreements contained in this Guarantee shall bind the successors, assigns, receivers, trustees and representatives of the Guarantor and shall inure to the benefit of the Holders of the Securities then outstanding. Except in connection with a consolidation, merger, sale or conveyance involving the Guarantor that is permitted by Article Eight of the Indenture and pursuant to which the successor or assignee agrees in writing to perform the Guarantor's obligations hereunder, the Guarantor shall not assign its obligations hereunder. SECTION 9.2 AMENDMENTS. Except with respect to any changes that do not materially adversely affect the rights of the Holders (in which case no consent of the Holders will be required), this Guarantee may not be amended without the prior approval of the Holders of at least a Majority in Liquidation Amount of the Securities. The provisions of Section 11.2 of the Trust Agreement with respect to meetings of, and action by written consent of, the Holders of the Securities apply to the giving of such approval. SECTION 9.3 NOTICES. All notices provided for in this Guarantee shall be in writing, duly signed by the party giving such notice, and shall be delivered by hand, telecopied or mailed by registered or certified mail, as follows: (a) If given to the Guarantee Trustee, at the Guarantee Trustee's mailing address set forth below (or such other address as the Guarantee Trustee may give notice of to the Guarantor and the Holders of the Securities): The Chase Manhattan Bank 450 West 33rd Street New York, New York 10001 Attention: Capital Markets Fiduciary Services Fax: (212) 946-8159/60 (b) If given to the Guarantor, at the Guarantor's mailing addresses set forth below (or such other address as the Guarantor may give notice of to the Guarantee Trustee and the Holders of the Securities): 20 Virginia Electric and Power Company One James River Plaza 701 East Cary Street Richmond, VA 23219 (c) If given to any Holder of Securities, at the address set forth on the books and records of the Trust. All such notices shall be deemed to have been given when received in person, telecopied with receipt confirmed, or mailed by first class mail, postage prepaid, except that if a notice or other document is refused delivery or cannot be delivered because of a changed address of which no notice was given, such notice or other document shall be deemed to have been delivered on the date of such refusal or inability to deliver. SECTION 9.4 BENEFIT. This Guarantee is solely for the benefit of the Holders of the Securities and, subject to Section 3.1(a), is not separately transferable from the Securities. SECTION 9.5 GOVERNING LAW. THIS GUARANTEE SHALL BE GOVERNED BY AND CONSTRUED AND INTERPRETED IN ACCORDANCE WITH THE LAW OF THE STATE OF NEW YORK WITHOUT REGARD TO ITS CONFLICT OF LAWS PRINCIPLES. 21 IN WITNESS WHEREOF, this Guarantee is executed as of the day and year first above written. VIRGINIA ELECTRIC POWER COMPANY as Guarantor By: _____________________________________ Name: Title: THE CHASE MANHATTAN BANK, as Guarantee Trustee By: _____________________________________ Name: Title: 22 EX-4.XI 11 0011.txt CERTIFICATE OF TRUST EXHIBIT 4(xi) CERTIFICATE OF TRUST VIRGINIA POWER CAPITAL TRUST II THIS CERTIFICATE OF TRUST of Virginia Power Capital Trust II (the "Trust"), dated as of ___, 2000 is being duly executed and filed by the undersigned, as trustee, to form a business trust under the Delaware Business Trust Act (12 Del. C. (S) 3801, et seq.). I. Name. The name of the business trust formed hereby is Virginia Power ---- Capital Trust II. II. Delaware Trustee. The name and business address of the trustee of the ---------------- Trust with a principal place of business in the State of Delaware is Chase Manhattan Bank Delaware, 1201 Market Street, Wilmington, Delaware 19801. IN WITNESS WHEREOF, the undersigned trustee of the Trust has executed this Certificate of Trust as of the date first-above written. CHASE MANHATTAN BANK DELAWARE, not in its individual capacity but solely as trustee of the Trust By: ______________________________ Name: Title: EX-4.XII 12 0012.txt TRUST AGREEMENT EXHIBIT 4(xii) TRUST AGREEMENT OF VIRGINIA POWER CAPITAL TRUST II THIS TRUST AGREEMENT is made as of _______, 2000 (this "Trust Agreement"), by and among Virginia Electric and Power Company, a Virginia corporation, as sponsor (the "Sponsor"), and Chase Manhattan Bank Delaware, a Delaware banking corporation (the "Trustee"). The Sponsor and the Trustee hereby agree as follows: 1. The trust created hereby shall be known as "Virginia Power Capital Trust II" (the "Trust") in which name the Trustee or the Sponsor, to the extent provided herein, may conduct the business of the Trust, make and execute contracts, and sue and be sued. 2. The Sponsor hereby assigns, transfers, conveys and sets over to the Trust the sum of ten dollars ($10.00). Such amount shall constitute the initial trust estate. It is the intention of the parties hereto that the Trust created hereby constitute a business trust under Chapter 38 of Title 12 of the Delaware Code, 12 Del. C. (S) 3801, et seq. (the "Business Trust Act"), and that this document constitute the governing instrument of the Trust. The Trustee is hereby authorized and directed to execute and file a certificate of trust with the Delaware Secretary of State in accordance with the provisions of the Business Trust Act. 3. The Sponsor and the Trustee will enter into an amended and restated Trust Agreement or Declaration satisfactory to each such party to provide for the contemplated operation of the Trust created hereby and the issuance of the Preferred Securities and the Common Securities referred to therein. Prior to the execution and delivery of such amended and restated Trust Agreement or Declaration, the Trustee shall not have any duty or obligation hereunder or with respect of the trust estate, except as otherwise required by applicable law or as may be necessary to obtain prior to such execution and delivery any licenses, consents or approvals required by applicable law or otherwise. Notwithstanding the foregoing, the Trustee may take all actions deemed proper as are necessary to effect the transactions contemplated herein. 4. The Sponsor, as the sponsor of the Trust, is hereby authorized, in its discretion, (i) to prepare and file with the Securities and Exchange Commission (the "Commission") and to execute, in each case on behalf of the Trust, (a) a Registration Statement (the "1933 Act Registration Statement"), including all pre-effective and post-effective amendments thereto, relating to the registration under the Securities Act of 1933, as amended (the "1933 Act"), of the Preferred Securities of the Trust and (b) a Registration Statement on Form 8-A (the "1934 Act Registration Statement"), including all pre-effective and post-effective amendments thereto, relating to the registration of the Preferred Securities of the Trust under the Securities Exchange Act of 1934, as amended; (ii) if and at such time as determined by the Sponsor, to file with the New York Stock Exchange or any other exchange or the National Association of Securities Dealers (each, an "Exchange"), and execute on behalf of the Trust one or more listing 1 applications and all other applications, statements, certificates, agreements and other instruments as shall be necessary or desirable to cause the Preferred Securities of the Trust to be listed on any of the Exchanges; (iii) to negotiate, execute, deliver and perform on behalf of the Trust an underwriting agreement with one or more underwriters relating to the offering of the Preferred Securities of the Trust; (iv) to file and execute on behalf of the Trust such applications, reports, surety bonds, irrevocable consents, appointments of attorney for service of process and other papers and documents that shall be necessary or desirable to register the Preferred Securities of the Trust under the securities or "Blue Sky" laws of such jurisdictions as the Sponsor, on behalf of the Trust, may deem necessary or desirable. In the event that any filing referred to in this Section 4 is required by the rules and regulations of the Commission, any Exchange or state securities or "Blue Sky" laws to be executed on behalf of the Trust by the trustees of the Trust (the "Trustees"), the Trustees, in their capacities as trustees of the Trust, are hereby authorized to join in any such filing and to execute on behalf of the Trust any and all of the foregoing, it being understood that the Trustees, in their capacities as trustees of the Trust, shall not be required to join in any such filing or execute on behalf of the Trust any such document unless required by the rules and regulations of the Commission, an Exchange or state securities or "Blue Sky" laws. 5. (a) The Trustees (the "Fiduciary Indemnified Persons") shall not be liable, responsible or accountable in damages or otherwise to the Trust, the Sponsor, the Trustees or any holder of the Trust securities (the Trust, the Sponsor and any holder of the Trust securities being a "Covered Person") for any loss, damage or claim incurred by reason of any act or omission performed or omitted by the Fiduciary Indemnified Persons in good faith on behalf of the Trust and in a manner the Fiduciary Indemnified Persons reasonably believed to be within the scope of authority conferred on the Fiduciary Indemnified Persons by this Agreement or by law, except that the Fiduciary Indemnified Persons shall be liable for any such loss, damage or claim incurred by reason of the Fiduciary Indemnified Person's gross negligence or willful misconduct with respect to such acts or omissions. (b) The Fiduciary Indemnified Persons shall be fully protected in relying in good faith upon the records of the Trust and upon such information, opinions, reports or statements presented to the Trust by any person as to matters the Fiduciary Indemnified Persons reasonably believes are within such other person's professional or expert competence and who, if selected by such person, has been selected by such person with reasonable care on behalf of the Trust, including information, opinions, reports or statements as to the value and amount of the assets, liabilities, profits, losses, or any other facts pertinent to the existence and amount of assets from which distributions to holders of Trust securities might properly be paid. 6. The Sponsor agrees to the fullest extent permitted by applicable law, (a) to indemnify and hold harmless each of the Fiduciary Indemnified Persons, or any of its officers, directors, shareholders, employees, representatives or agents, from and against any loss, damage, liability, tax, penalty, expense or claim of any kind or nature 2 whatsoever incurred by any of the Fiduciary Indemnified Persons by reason of the creation, operation or termination of the Trust in a manner any of the Fiduciary Indemnified Persons reasonably believed to be within the scope of authority conferred on any of the Fiduciary Indemnified Persons by this Trust Agreement, except that none of the Fiduciary Indemnified Persons shall be entitled to be indemnified in respect of any loss, damage or claim incurred by any of the Fiduciary Indemnified Persons by reason of gross negligence or willful misconduct with respect to such acts or omissions; and (b) to advance expenses (including legal fees) incurred by a Fiduciary Indemnified Person in defending any claim, demand, action, suit or proceeding, from time to time, prior to the final disposition of such claim, demand, action, suit or proceeding, upon receipt by the Trust of an undertaking by or on behalf of such Fiduciary Indemnified Person to repay such amount if it shall be determined that such Fiduciary Indemnified Person is not entitled to be indemnified as authorized in the preceding subsection. 7. The provisions of Section 6 shall survive the termination of this Trust Agreement or the earlier resignation or removal of any of the Fiduciary Indemnified Persons. 8. The Trust may terminate without issuing any Trust securities at the election of the Sponsor. 9. This Trust Agreement may be executed in one or more counterparts. 10. The number of trustees of the Trust initially shall be one and thereafter the number of trustees of the Trust shall be such number as shall be fixed from time to time by a written instrument signed by the Sponsor which may increase or decrease the number of trustees of the Trust; provided, however, that to the extent required by the Business Trust Act, one trustee of the Trust shall either be a natural person who is a resident of the State of Delaware or, if not a natural person, an entity which has its principal place of business in the State of Delaware. Subject to the foregoing, the Sponsor is entitled to appoint or remove without cause any trustee of the Trust at any time. Any trustee of the Trust may resign upon thirty days' prior notice to the Sponsor. 11. This Trust Agreement shall be governed by, and construed in accordance with, the laws of the State of Delaware (without regard to conflict of laws principles). 3 IN WITNESS WHEREOF, the parties hereto have caused this Trust Agreement to be duly executed as of the day and year first above written. VIRGINIA ELECTRIC AND POWER COMPANY, as Sponsor By: ___________________________________ Name: Title: CHASE MANHATTAN BANK DELAWARE, not in its individual capacity but solely as trustee of the Trust By: ___________________________________ Name: Title: 4 EX-4.XIII 13 0013.txt EXHIBIT 4(XIII) Exhibit 4(xiii) FORM OF AMENDED AND RESTATED TRUST AGREEMENT Dated as of __________ __, 2000 By and Among VIRGINIA ELECTRIC AND POWER COMPANY, as Sponsor, THE CHASE MANHATTAN BANK, as Property Trustee, THE CHASE MANHATTAN BANK DELAWARE, as Delaware Trustee, and THE ADMINISTRATIVE TRUSTEES NAMED HEREIN Dated as of ____, 200_ CROSS REFERENCE TABLE* SECTION OF TRUST INDENTURE ACT OF SECTION OF 1939, AS AMENDED AGREEMENT - ---------------- ---------- 310(A)................................................. 6.3 310(B)................................................. 6.3(C); 6.3(D) 310(C)................................................. INAPPLICABLE 311(A)................................................. 2.2(B) 311(B)................................................. 2.2(B) 311(C)................................................. INAPPLICABLE 312(A)................................................. 2.2(A) 312(B)................................................. 2.2(B) 312(C)................................................. INAPPLICABLE 313(A)................................................. 2.3 313(B)................................................. 2.3 313(C)................................................. 2.3 313(D)................................................. 2.3 314(A)................................................. 2.4 314(B)................................................. INAPPLICABLE 314(C)................................................. 2.5 314(D)................................................. INAPPLICABLE 314(E)................................................. 2.5 314(F)................................................. INAPPLICABLE 315(A)................................................. 3.9(B); 3.10(A) 315(B)................................................. 2.7(A) 315(C)................................................. 3.9(A) 315(D)................................................. 3.9(B) 316(A)................................................. 2.6; 7.5(B); 7.6(C) 316(B)................................................. INAPPLICABLE 316(C)................................................. INAPPLICABLE 317(A)................................................. 3.16 317(B)................................................. INAPPLICABLE 318(A)................................................. 2.1(C) _________ * THIS CROSS-REFERENCE TABLE DOES NOT CONSTITUTE PART OF THE AGREEMENT AND SHALL NOT HAVE ANY BEARING UPON THE INTERPRETATION OF ANY OF ITS TERMS OR PROVISIONS. i TABLE OF CONTENTS
Page ---- ARTICLE 1 INTERPRETATION AND DEFINITIONS.......................................... 1 Section 1.1 Interpretation and Definitions.................................... 1 ARTICLE 2 TRUST INDENTURE ACT..................................................... 9 Section 2.1 Trust Indenture Act; Application.................................. 9 Section 2.2 Lists of Holders of Securities.................................... 9 Section 2.3 Reports By the Property Trustee................................... 10 Section 2.4 Periodic Reports to the Property Trustee.......................... 10 Section 2.5 Evidence of Compliance With Conditions Precedent.................. 10 Section 2.6 Trust Enforcement Event; Waiver................................... 10 Section 2.7 Trust Enforcement Event; Notice................................... 12 ARTICLE 3 ORGANIZATION............................................................ 13 Section 3.1 Name and Organization............................................. 13 Section 3.2 Office............................................................ 13 Section 3.3 Purpose........................................................... 13 Section 3.4 Authority......................................................... 13 Section 3.5 Title to Property of the Trust.................................... 14 Section 3.6 Powers and Duties of the Administrative Trustees.................. 14 Section 3.7 Prohibition of Actions by the Trust and the Trustees.............. 17 Section 3.8 Powers and Duties of the Property Trustee......................... 18 Section 3.9 Certain Duties and Responsibilities of the Property Trustee....... 19 Section 3.10 Certain Rights of Property Trustee................................ 21 Section 3.11 Delaware Trustee.................................................. 23 Section 3.12 Execution of Documents............................................ 24 Section 3.13 Not Responsible for Recitals or Issuance of Securities............ 24 Section 3.14 Duration of Trust................................................. 24 Section 3.15 Mergers........................................................... 24 Section 3.16 Property Trustee May File Proofs of Claim......................... 26 ARTICLE 4 SPONSOR................................................................. 27 Section 4.1 Responsibilities of the Sponsor................................... 27 Section 4.2 Indemnification and Fees and Expenses of the Trustees............. 27 ARTICLE 5 TRUST COMMON SECURITIES HOLDER.......................................... 28 Section 5.1 Junior Subordinated Note Issuer's Purchase of Common Securities... 28 Section 5.2 Covenants of the Common Securities Holder......................... 28 ARTICLE 6 TRUSTEES................................................................ 28 Section 6.1 Number of Trustees................................................ 28 Section 6.2 Delaware Trustee; Eligibility..................................... 29 Section 6.3 Property Trustee; Eligibility..................................... 29
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Page ---- Section 6.4 Qualifications of Administrative Trustees and Delaware Trustee Generally........................................................ 30 Section 6.5 Initial Administrative Trustees.................................. 30 Section 6.6 Appointment, Removal and Resignation of Trustees................. 30 Section 6.7 Vacancies Among Trustees......................................... 32 Section 6.8 Effect of Vacancies.............................................. 32 Section 6.9 Meetings......................................................... 32 Section 6.10 Delegation of Power.............................................. 32 Section 6.11 Merger, Conversion, Consolidation or Succession to Business 33 ARTICLE 7 TERMS OF SECURITIES.................................................... 33 Section 7.1 General Provisions Regarding Securities.......................... 33 Section 7.2 Distributions.................................................... 35 Section 7.3 Redemption of Securities......................................... 36 Section 7.4 Redemption Procedures............................................ 37 Section 7.5 Voting Rights of Trust Preferred Securities...................... 38 Section 7.6 Voting Rights of Common Securities............................... 41 Section 7.7 Paying Agent..................................................... 42 Section 7.8 Listing.......................................................... 42 Section 7.9 Transfer of Securities........................................... 42 Section 7.10 Mutilated, Destroyed, Lost or Stolen Certificates................ 44 Section 7.11 Deemed Security Holders.......................................... 44 Section 7.12 Global Securities................................................ 44 Section 7.13 Over-Allotment Option............................................ 46 Section 7.14 Cancellation..................................................... 48 ARTICLE 8 DISSOLUTION AND TERMINATION OF TRUST................................... 48 Section 8.1 Dissolution and Termination of Trust............................. 48 Section 8.2 Liquidation Distribution Upon Dissolution of the Trust........... 49 ARTICLE 9 LIMITATION OF LIABILITY OF HOLDERS OF SECURITIES, DELAWARE TRUSTEES OR OTHERS............................................ 49 Section 9.1 Liability........................................................ 49 Section 9.2 Exculpation...................................................... 50 Section 9.3 Fiduciary Duty................................................... 50 Section 9.4 Indemnification.................................................. 51 Section 9.5 Outside Businesses............................................... 54 ARTICLE 10 ACCOUNTING............................................................ 55 Section 10.1 Fiscal Year...................................................... 55 Section 10.2 Certain Accounting Matters....................................... 55 Section 10.3 Banking.......................................................... 55 Section 10.4 Withholding...................................................... 56
iii ARTICLE 11 AMENDMENTS AND MEETINGS........................................... 56 Section 11.1 Amendments................................................... 56 Section 11.2 Meetings of the Holders of Securities; Action by Written Consent.............................................. 58 ARTICLE 12 REPRESENTATIONS OF PROPERTY TRUSTEE AND DELAWARE TRUSTEE.................................................. 60 Section 12.1 Representations and Warranties of the Property Trustee....... 59 Section 12.2 Representations and Warranties of the Delaware Trustee....... 60 ARTICLE 13 MISCELLANEOUS..................................................... 61 Section 13.1 Notices...................................................... 61 Section 13.2 Governing Law................................................ 62 Section 13.3 Intention of the Parties..................................... 62 Section 13.4 Headings..................................................... 62 Section 13.5 Successors and Assigns....................................... 62 Section 13.6 Partial Enforceability....................................... 62 Section 13.7 Counterparts................................................. 63
EXHIBITS - -------- EXHIBIT A FORM OF TRUST PREFERRED SECURITY CERTIFICATE EXHIBIT B FORM OF COMMON SECURITY CERTIFICATE iv AMENDED AND RESTATED TRUST AGREEMENT This AMENDED AND RESTATED TRUST AGREEMENT (the "Trust Agreement"), dated as of ,____, 200_ is entered into by and among (i) Virginia Electric and Power Company, a Virginia corporation, as sponsor (the "Sponsor"), (ii)(a) The Chase Manhattan Bank, a New York banking corporation, as initial Property Trustee, (b) The Chase Manhattan Bank Delaware, a Delaware corporation, as Delaware Trustee, and (c) _________, an individual, and __________, an individual, each of whose address is __________, _________ 23219 (each an "Administrative Trustee" and, collectively, the "Administrative Trustees" and, together with the Property Trustee and the Delaware Trustee, the "Trustees", all not in their individual capacities, but solely as Trustees) and (iii) the several Holders as hereinafter defined. RECITALS WHEREAS, the Delaware Trustee and the Sponsor established Virginia Power Capital Trust II (the "Trust"), a business trust under the Business Trust Act (as defined, together with other capitalized terms, herein) pursuant to a Trust Agreement dated as of ______, 200_ (the "Original Trust Agreement") and a Certificate of Trust (the "Certificate of Trust") filed with the Secretary of State of the State of Delaware on ______, 200_; WHEREAS, the sole purpose of the Trust shall be to issue and sell certain securities representing undivided beneficial ownership interests in the assets of the Trust, to invest the proceeds from such sales in the Junior Subordinated Notes issued by the Junior Subordinated Note Issuer and to engage in only those activities necessary or incidental thereto; and WHEREAS, the parties hereto, by this Trust Agreement, amend and restate each and every term and provision of the Original Trust Agreement; NOW, THEREFORE, it being the intention of the parties hereto to continue the Trust as a business trust under the Business Trust Act and that this Trust Agreement constitute the governing instrument of such business trust, the Trustees hereby declare that all assets contributed to the Trust be held in trust for the benefit of the Holders, from time to time, of the Securities representing undivided beneficial ownership interests in the assets of the Trust issued hereunder, subject to the provisions of this Trust Agreement. ARTICLE 1 INTERPRETATION AND DEFINITIONS SECTION 1.1 Interpretation and Definitions. Unless the context otherwise requires: 1 (a) capitalized terms used in this Trust Agreement but not defined in the preamble above have the meanings assigned to them in this Section 1.1; (b) a term defined anywhere in this Trust Agreement has the same meaning throughout; (c) all references to "the Trust Agreement" or "this Trust Agreement" are to this Trust Agreement as modified, supplemented or amended from time to time; (d) all references in this Trust Agreement to Articles, Sections, Recitals and Exhibits are to Articles and Sections of, or Recitals and Exhibits to, this Trust Agreement unless otherwise specified; (e) unless otherwise defined in this Trust Agreement, a term defined in the Trust Indenture Act has the same meaning when used in this Trust Agreement; and (f) a reference to the singular includes the plural and vice versa and a reference to any masculine form of a term shall include the feminine form of a term, as applicable. (g) the following terms have the following meanings: "ADMINISTRATIVE TRUSTEE" means any Trustee other than the Property Trustee and the Delaware Trustee. "AFFILIATE" of any specified Person shall mean any other Person directly or indirectly controlling or controlled by, or under direct or indirect common control with, such specified Person. For the purposes of this definition, "control" when used with respect to any specified Person shall mean the power to direct the management and policies of such Person, directly or indirectly, whether through the ownership of voting securities, by contract or otherwise; and the terms "controlling" and "controlled" shall have meanings correlative to the foregoing. "AUTHORIZED OFFICER" of a Person means any Person that is authorized to bind such Person. "BANKRUPTCY EVENT" means, with respect to any Person: (a) the entry of a decree or order by a court having jurisdiction in the premises judging such Person a bankrupt or insolvent, or approving as properly filed a petition seeking reorganization, arrangement, adjudication or composition of or in respect of such Person under any applicable Federal or State bankruptcy, insolvency, reorganization or other similar law, or appointing a receiver, liquidator, assignee, trustee, sequestrator (or other similar official) of such Person or of any substantial part of its property or ordering the winding up or liquidation of its affairs, and the continuance of any such decree or order unstayed and in effect for a period of 60 consecutive days; or 2 (b) the institution by such Person of proceedings to be adjudicated bankrupt or insolvent, or the consent by it to the institution of bankruptcy or insolvency proceedings against it, or the filing by it of a petition or answer or consent seeking reorganization or relief under any applicable Federal or State bankruptcy, insolvency, reorganization or other similar law, or the consent by it to the filing of any such petition or to the appointment of a receiver, liquidator, assignee, trustee, sequestrator (or other similar official) of such Person or of any substantial part of its property, or the making by it of an assignment for the benefit of creditors, or the admission by it in writing of its inability to pay its debts generally as they become due and its willingness to be adjudicated a bankrupt, or the taking of corporate action by such Person in furtherance of any such action. "BENEFICIAL OWNER" means, for Trust Preferred Securities represented by a Global Security, the Person who acquires an interest in the Trust Preferred Securities which is reflected on the records of the Depositary through the Depositary Participants. "BUSINESS DAY" means any day, other than a Saturday or Sunday, that is not a day on which banking institutions in the Borough of Manhattan, The City of New York are authorized or required by law, regulation or executive order to close. "BUSINESS TRUST ACT" means Chapter 38 of Title 12 of the Delaware Code, 12 Del. Code Section 3801 et seq., as it may be amended from time to time, or any successor legislation. "CASH SETTLEMENT" shall have the meaning specified in the Purchase Contract Agreement. "CERTIFICATE" means a Common Security Certificate or a Trust Preferred Security Certificate. "CERTIFICATE OF TRUST" has the meaning specified in the Recitals hereto. "CLOSING DATE" means the date on which the Trust Preferred Securities are issued and sold, PROVIDED that if the Trust and the Sponsor grant the underwriters or initial purchasers an option to purchase an additional amount of Trust Preferred Securities, pursuant to Section 7.13(a), including for the purpose of covering over-allotments, pursuant to the underwriting agreement or purchase agreement, as the case may be, and such option is so exercised, then the term "Closing Date" shall mean such initial or second closing date, as the context requires. "CODE" means the Internal Revenue Code of 1986, as amended from time to time, or any successor legislation. A reference to a specific section of the Code refers not only to such specific section but also to any corresponding provision of any federal tax statute enacted after the date of this Trust Agreement, as such specific section or corresponding provision is in effect on the date of application of the provisions of this Trust Agreement containing such reference. "COMMISSION" means the Securities and Exchange Commission or any successor thereto. 3 "COMMON SECURITY" has the meaning specified in Section 7.1. "COMMON SECURITY CERTIFICATE" means a definitive certificate in fully registered form representing a Common Security, substantially in the form of Exhibit B hereto. "COMMON SECURITIES HOLDER" means Virginia Electric and Power Company, in its capacity as purchaser and holder of all of the Common Securities issued by the Trust. "CORPORATE TRUST OFFICE" means the office of the Property Trustee at which at any particular time its corporate trust business shall be principally administered, which office at the date of execution of this Trust Agreement is located at 450 West 33rd Street, New York, NY 10001, Attention: Capital Markets Fiduciary Services. "COVERED PERSON" means (a) any officer, director, shareholder, partner, member, representative, employee or agent of (i) the Trust or (ii) the Trust's Affiliates; and (b) any Holder. "DEPOSITARY" means, with respect to Securities issuable in whole or in part in the form of one or more Global Securities, a clearing agency registered under the Exchange Act that is designated to act as Depositary for such Securities. "DEPOSITARY PARTICIPANT" means a member of, or participant in, the Depositary. "DIRECT ACTION" has the meaning specified in Section 3.8(e). "DISTRIBUTION" means a distribution payable to Holders of Securities in accordance with Section 7.2. "EXCHANGE ACT" means the Securities Exchange Act of 1934, as amended from time to time, or any successor legislation. "FIDUCIARY INDEMNIFIED PERSON" has the meaning set forth in Section 9.4(b). "FISCAL YEAR" has the meaning specified in Section 10.1. "GLOBAL SECURITY" means a fully registered, global Trust Preferred Security Certificate. "GUARANTEE" means the Guarantee Agreement, dated as of ________ __, 200_, of the Sponsor in respect of the Securities. "HOLDER" means any holder of Securities, as registered on the books and records of the Trust; provided, however, that in determining whether the Holders of the requisite liquidation amount of Trust Preferred Securities have voted on any matter provided for in this Trust Agreement, then for the purpose of such determination only (and not for any other purpose hereunder), if the Trust Preferred Securities remain in the form of one or more Global Securities 4 and if the Depositary which is the holder of such Global Securities has sent an omnibus proxy to the Trust assigning voting rights to Depositary Participants to whose accounts the Trust Preferred Securities are credited on the record date, the term "Holders" shall mean such Depositary Participants acting at the direction of the Beneficial Owners. "INDEMNIFIED PERSON" means a Junior Subordinated Note Issuer Indemnified Person or a Fiduciary Indemnified Person. "INDENTURE" means the Subordinated Note Indenture, dated as of August 1,1995, between the Junior Subordinated Note Issuer and The Chase Manhattan Bank, as Trustee, as supplemented and amended by a First Supplemental Indenture dated as of August 1, 1995 and as further amended or supplemented by any other indenture supplemental thereto pursuant to which the Junior Subordinated Notes are to be issued to the Property Trustee. "INDENTURE EVENT OF DEFAULT" has the meaning given to the term "Event of Default" in the Indenture. "INDENTURE TRUSTEE" means The Chase Manhattan Bank, in its capacity as trustee under the Indenture until a successor is appointed thereunder, and thereafter means such successor trustee. "INVESTMENT COMPANY" means an investment company as defined in the Investment Company Act and the regulations promulgated thereunder. "INVESTMENT COMPANY ACT" means the Investment Company Act of 1940, as amended from time to time, or any successor legislation. "INVESTMENT COMPANY EVENT" means the receipt by the Trust of an opinion of a nationally recognized independent counsel (an "Investment Company Act Opinion"), to the effect that, as a result of the occurrence of a change in law or regulation or a written change in interpretation or application of law or regulation by any legislative body, court, governmental agency or regulatory authority (a "Change in 1940 Act Law"), the Trust is or will be considered an "investment company" that is required to be registered under the Investment Company Act, which Change in 1940 Act Law becomes effective on or after the Closing Date. "JUNIOR SUBORDINATED NOTES" shall mean the series of junior subordinated notes to be issued by the Junior Subordinated Note Issuer under the Indenture and to be purchased by the Trust and held by the Property Trustee. "JUNIOR SUBORDINATED NOTE ISSUER" shall mean Virginia Electric and Power Company, a Virginia corporation, in its capacity as issuer of the Junior Subordinated Notes under the Indenture and any successor corporation under Article Eight of the Indenture. "JUNIOR SUBORDINATED NOTE ISSUER INDEMNIFIED PERSON" shall mean (A) any Administrative Trustee, (B) any Affiliate of any Administrative Trustee, (C) any officers, directors, shareholders, members, partners, employees, representatives or agents of any 5 Administrative Trustee or any Affiliate thereof or (D) any officer, employee or agent of the Trust or its Affiliates. "LEGAL ACTION" has the meaning specified in Section 3.6(g). "LIST OF HOLDERS" has the meaning specified in Section 2.2(a). "MAJORITY IN LIQUIDATION AMOUNT" means, except as provided in the terms of the Trust Preferred Securities or by the Trust Indenture Act, Holder(s) of outstanding Securities, voting together as a single class, or, as the context may require, Holders of outstanding Trust Preferred Securities or Holders of outstanding Common Securities, voting separately as a class, who are the record owners of more than 50% of the aggregate liquidation amount (including the stated amount that would be paid on redemption, liquidation or otherwise, plus accumulated and unpaid Distributions to the date upon which the voting percentages are determined) of all outstanding Securities of the relevant class. "NEW YORK STOCK EXCHANGE" means the New York Stock Exchange, Inc. or any successor thereto. "OFFICERS' CERTIFICATE" means, with respect to any Person, a certificate signed on behalf of such Person by two Authorized Officers of such Person. Any Officers' Certificate delivered with respect to compliance with a condition or covenant provided for in this Trust Agreement (other than pursuant to Section 2.4) shall include: (a) a statement that each officer signing the Officers' Certificate has read the covenant or condition and the definitions relating thereto; (b) a brief statement of the nature and scope of the examination or investigation undertaken by each officer on behalf of such Person in rendering the Officers' Certificate; (c) a statement that each such officer has made such examination or investigation as, in such officer's opinion, is necessary to enable such officer on behalf of such Person to express an informed opinion as to whether or not such covenant or condition has been complied with; and (d) a statement as to whether, in the opinion of each such officer acting on behalf of such Person, such condition or covenant has been complied with; provided, that the term "Officers' Certificate", when used with reference to Administrative Trustees who are natural persons shall mean a certificate signed by two or more of the Administrative Trustees which otherwise satisfies the foregoing requirements. ["OPTION" has the meaning specified in Section 7.13(a).] "PAYING AGENT" has the meaning specified in Section 3.8(h). "PAYMENT AMOUNT" has the meaning specified in Section 7.2(c). 6 "PERSON" means a legal person, including any individual, corporation, estate, partnership, joint venture, association, joint stock company, limited liability company, trust, unincorporated association, or government or any agency or political subdivision thereof, or any other entity of whatever nature. "PROPERTY ACCOUNT" has the meaning specified in Section 3.8(c). "PROPERTY TRUSTEE" means the Trustee meeting the eligibility requirements set forth in Section 6.3. "PRO RATA" means pro rata to each Holder of Securities according to the aggregate liquidation amount of the Securities held by the relevant Holder in relation to the aggregate liquidation amount of all Securities outstanding. ["PURCHASE CONTRACT AGREEMENT" shall mean the Purchase Contract Agreement dated as of ____, 200_ between the Company and the [_______], as Purchase Contract Agent.] "QUORUM" means a majority of the Administrative Trustees or, if there are only two Administrative Trustees, both of them. "REDEMPTION/DISTRIBUTION NOTICE" has the meaning specified in Section 7.4(a) hereto. "REDEMPTION PRICE" means the amount for which the Securities will be redeemed, which amount will equal (i) the redemption price paid by the Junior Subordinated Note Issuer to repay or redeem, in whole or in part, the Junior Subordinated Notes held by the Trust plus an amount equal to accumulated and unpaid Distributions on such Securities through the date of their redemption or (ii) such lesser amount as will be received by the Trust in respect of the Junior Subordinated Notes so repaid or redeemed. "RELATED PARTY" means, with respect to the Sponsor, any direct or wholly owned subsidiary of the Sponsor or any Person that owns, directly or indirectly, 100% of the outstanding voting securities of the Sponsor. "RESPONSIBLE OFFICER" means, with respect to the Property Trustee, any officer with direct responsibility for the administration of this Trust Agreement and also means, with respect to a particular corporate trust matter, any other officer to whom such matter is referred because of that officer's knowledge of and familiarity with the particular subject. "SECURITIES" means the Common Securities and the Trust Preferred Securities. "SECURITIES ACT" means the Securities Act of 1933, as amended from time to time, or any successor legislation. 7 "SPECIAL EVENT" means a Tax Event or an Investment Company Event. "SPONSOR" means Virginia Electric and Power Company, a Virginia corporation, or any successor entity in a transaction involving the Sponsor that is permitted by Article Eight of the Indenture and pursuant to which the successor agrees in writing to perform the Sponsor's obligations hereunder. "SUCCESSOR DELAWARE TRUSTEE" has the meaning specified in Section 6.6(b). "SUCCESSOR ENTITY" has the meaning specified in Section 3.15(b)(i). "SUCCESSOR PROPERTY TRUSTEE" has the meaning specified in Section 6.6(b). "SUCCESSOR SECURITY" has the meaning specified in Section 3.15(b)(i)b. "SUPER MAJORITY" has the meaning specified in Section 2.6(a)(ii). "TAX EVENT" means the receipt by the Trust of an opinion of independent tax counsel experienced in such matters ("Tax Event Opinion"), to the effect that, as a result of (a) any amendment to, change in or announced prospective change in the laws (or any regulations thereunder) of the United States or any political subdivision or taxing authority thereof or therein, or (b) any official administrative written decision or pronouncement, or judicial decision interpreting or applying such laws or regulations, which amendment or change is effective or which, pronouncement, or decision is announced on or after the Closing Date, there is more than an insubstantial risk that (i) the Trust is, or will be within 90 days of the date of such opinion, subject to the United States federal income tax with respect to income received or accrued on the Junior Subordinated Notes, (ii) interest payable by the Junior Subordinated Note Issuer on the Junior Subordinated Notes is not, or within 90 days of the date of such opinion will not be, deductible, in whole or in part, by the Junior Subordinated Note Issuer for United States federal income tax purposes, or (iii) the Trust is, or will be within 90 days of the date of such opinion, subject to more than a de minimis amount of other taxes, duties or other governmental charges. "10% IN LIQUIDATION AMOUNT" means, except as provided in the terms of the Trust Preferred Securities or by the Trust Indenture Act, Holder(s) of outstanding Securities, voting together as a single class, or, as the context may require, Holders of outstanding Trust Preferred Securities or Holders of outstanding Common Securities, voting separately as a class, who are the record owners of 10% or more of the aggregate liquidation amount (including the stated amount that would be paid on redemption, liquidation or otherwise, plus accrued and unpaid Distributions to the date upon which the voting percentages are determined) of all outstanding Securities of the relevant class. "TREASURY REGULATIONS" means the income tax regulations, including temporary and proposed regulations, promulgated under the Code by the United States Treasury, as such regulations may be amended from time to time (including corresponding provisions of succeeding regulations). 8 "TRUST ENFORCEMENT EVENT" in respect of the Securities means an Indenture Event of Default has occurred and is continuing in respect of the Junior Subordinated Notes. "TRUST INDENTURE ACT" means the Trust Indenture Act of 1939, as amended from time to time, or any successor legislation. "TRUST PREFERRED SECURITY" has the meaning specified in Section 7.1. "TRUST PREFERRED SECURITY CERTIFICATE" means a definitive certificate in fully registered form representing a Trust Preferred Security, substantially in the form of Exhibit A. "TRUSTEE" or "TRUSTEES" means each Person who has signed this Trust Agreement as a trustee, so long as such Person shall continue as a trustee in accordance with the terms hereof, and all other Persons who may from time to time be duly appointed, qualified and serving as Trustees in accordance with the provisions hereof, and references herein to a Trustee or the Trustees shall refer to such Person or Persons solely in their capacity as trustees hereunder. ARTICLE 2 TRUST INDENTURE ACT SECTION 2.1 Trust Indenture Act; Application. (a) This Trust Agreement is subject to the provisions of the Trust Indenture Act that are required to be part of this Trust Agreement and shall, to the extent applicable, be governed by such provisions. (b) The Property Trustee shall be the only Trustee which is a Trustee for the purposes of the Trust Indenture Act. (c) If and to the extent that any provision of this Trust Agreement conflicts with the duties imposed by Sections 310 to 317, inclusive, of the Trust Indenture Act, such imposed duties shall control. (d) The application of the Trust Indenture Act to this Trust Agreement shall not affect the Trust's classification as a grantor trust for United States federal income tax purposes and shall not affect the nature of the Securities as equity securities representing undivided beneficial ownership interests in the assets of the Trust. SECTION 2.2 Lists of Holders of Securities. (a) Each of the Sponsor and the Administrative Trustees on behalf of the Trust shall provide the Property Trustee at any time when the Property Trustee is not also acting as Security 9 Registrar for the Securities (i) except while the Trust Preferred Securities are represented by one or more Global Securities, at least five Business Days prior to the date for payment of Distributions, a list, in such form as the Property Trustee may reasonably require, of the names and addresses of the Holders of the Securities ("List of Holders") as of the record date relating to the payment of such Distributions, and (ii) at any other time, within 30 days of receipt by the Trust of a written request from the Property Trustee for a List of Holders, as of a date no more than 15 days before such List of Holders is given to the Property Trustee; provided that neither the Sponsor nor the Administrative Trustees on behalf of the Trust shall be obligated to provide such List of Holders at any time the List of Holders does not differ from the most recent List of Holders given to the Property Trustee by the Sponsor and the Administrative Trustees on behalf of the Trust. The Property Trustee shall preserve, in as current a form as is reasonably practicable, all information contained in Lists of Holders given to it or which it receives in the capacity as Paying Agent (if acting in such capacity), provided that the Property Trustee may destroy any List of Holders previously given to it on receipt of a new List of Holders. (b) The Property Trustee shall comply with its obligations under, and shall be entitled to the benefits of, Sections 311(a), 311(b) and 312(b) of the Trust Indenture Act. SECTION 2.3 Reports by the Property Trustee. Within 60 days after May 15 of each year (commencing with the year of the first anniversary of the issuance of the Trust Preferred Securities), the Property Trustee shall provide to the Holders of the Trust Preferred Securities such reports as are required by Section 313(a) of the Trust Indenture Act, if any, in the form and in the manner provided by Section 313 of the Trust Indenture Act. The Property Trustee shall also comply with the other requirements of Section 313 of the Trust Indenture Act. The Sponsor shall promptly notify the Property Trustee when the Trust Preferred Securities are listed on any stock exchange. SECTION 2.4 Periodic Reports to the Property Trustee. Each of the Sponsor and the Administrative Trustees on behalf of the Trust shall provide to the Property Trustee such documents, reports and information as required by Section 314 of the Trust Indenture Act (if any) and the compliance certificate required by Section 314(a)(4) of the Trust Indenture Act in the form, in the manner and at the times required by Section 314 of the Trust Indenture Act, provided that such compliance certificate shall be delivered on or before 120 days after the end of each calendar year of the Sponsor. SECTION 2.5 Evidence of Compliance with Conditions Precedent. Each of the Sponsor and the Administrative Trustees on behalf of the Trust shall provide to the Property Trustee such evidence of compliance with any conditions precedent, if any, provided for in this Trust Agreement that relate to any of the matters set forth in Section 314(c) of the Trust Indenture Act. Any certificate or opinion required to be given by an officer pursuant to Section 314(c)(1) may be given in the form of an Officers' Certificate. SECTION 2.6 Trust Enforcement Events; Waiver. 10 (a) The Holders of a Majority in Liquidation Amount of the Trust Preferred Securities may, by vote or written consent, on behalf of the Holders of all of the Trust Preferred Securities, waive any past Trust Enforcement Event in respect of the Trust Preferred Securities and its consequences, provided that, if the underlying Indenture Event of Default: (i) is not waivable under the Indenture, the Trust Enforcement Event under the Trust Agreement shall also not be waivable; or (ii) requires the consent or vote of the Holders of greater than a majority in principal amount of the Junior Subordinated Notes (a "Super Majority") to be waived under the Indenture, the related Trust Enforcement Event under the Trust Agreement may only be waived by the vote or written consent of the Holders of at least the proportion in liquidation amount of the Trust Preferred Securities that the relevant Super Majority represents of the aggregate principal amount of the Junior Subordinated Notes outstanding. The foregoing provisions of this Section 2.6(a) shall be in lieu of Section 316(a)(1)(B) of the Trust Indenture Act and such Section 316(a)(1)(B) of the Trust Indenture Act is hereby expressly excluded from this Trust Agreement and the Securities, as permitted by the Trust Indenture Act. Upon such waiver, any such default shall cease to exist, and any Trust Enforcement Event with respect to the Trust Preferred Securities arising therefrom shall be deemed to have been cured, for every purpose of this Trust Agreement and the Trust Preferred Securities, but no such waiver shall extend to any subsequent or other Trust Enforcement Event with respect to the Trust Preferred Securities or impair any right consequent thereon. Any waiver by the Holders of the Trust Preferred Securities of a Trust Enforcement Event with respect to the Trust Preferred Securities shall also be deemed to constitute a waiver by the Holders of the Common Securities of any such Trust Enforcement Event with respect to the Common Securities for all purposes of this Trust Agreement without any further act, vote, or consent of the Holders of the Common Securities. (b) The Holders of a Majority in Liquidation Amount of the Common Securities may, by vote or written consent, on behalf of the Holders of all of the Common Securities, waive any past Trust Enforcement Event in respect of the Common Securities and its consequences, provided that, if the underlying Indenture Event of Default: (i) is not waivable under the Indenture, except where the Holders of the Common Securities are deemed to have waived such Trust Enforcement Event under the Trust Agreement as provided below in this Section 2.6(b), the Trust Enforcement Event under the Trust Agreement shall also not be waivable; or (ii) requires the consent or vote of a Super Majority to be waived under the Indenture, except where the Holders of the Common Securities are deemed to have waived such Trust Enforcement Event under the Trust Agreement as provided below in this Section 2.6(b), the Trust Enforcement Event under the Trust Agreement may only be waived by the vote or written consent of the Holders of at least the proportion in liquidation amount of the Common Securities that the relevant Super Majority represents of the aggregate principal amount of the 11 Junior Subordinated Notes outstanding; provided further, each Holder of Common Securities will be deemed to have waived any Trust Enforcement Event and all Trust Enforcement Events with respect to the Common Securities and the consequences thereof until all Trust Enforcement Events with respect to the Trust Preferred Securities have been cured, waived or otherwise eliminated, and until such Trust Enforcement Events with respect to the Trust Preferred Securities have been so cured, waived or otherwise eliminated, the Property Trustee will be deemed to be acting solely on behalf of the Holders of the Trust Preferred Securities and only the Holders of the Trust Preferred Securities will have the right to direct the Property Trustee in accordance with the terms of the Securities. The foregoing provisions of this Section 2.6(b) shall be in lieu of Sections 316(a)(1)(A) and 316(a)(1)(B) of the Trust Indenture Act and such Sections 316(a)(1)(A) and 316(a)(1)(B) of the Trust Indenture Act are hereby expressly excluded from this Trust Agreement and the Securities, as permitted by the Trust Indenture Act. Subject to the foregoing provisions of this Section 2.6(b), upon such cure, waiver or other elimination, any such default shall cease to exist and any Trust Enforcement Event with respect to the Common Securities arising therefrom shall be deemed to have been cured for every purpose of this Trust Agreement, but no such waiver shall extend to any subsequent or other Trust Enforcement Event with respect to the Common Securities or impair any right consequent thereon. (c) A waiver of an Indenture Event of Default by the Property Trustee at the direction of the Holders of the Trust Preferred Securities constitutes a waiver of the corresponding Trust Enforcement Event with respect to the Trust Preferred Securities under this Trust Agreement. The foregoing provisions of this Section 2.6(c) shall be in lieu of Section 316(a)(1)(B) of the Trust Indenture Act and such Section 316(a)(1)(B) of the Trust Indenture Act is hereby expressly excluded from this Trust Agreement and the Securities, as permitted by the Trust Indenture Act. SECTION 2.7 Trust Enforcement Event; Notice. (a) The Property Trustee shall, within 90 days after the occurrence of a Trust Enforcement Event actually known to a Responsible Officer of the Property Trustee, transmit by mail, first class postage prepaid, to the Holders of the Securities, notices of all such defaults with respect to the Securities, unless such defaults have been cured before the giving of such notice (the term "defaults" for the purposes of this Section 2.7(a) and (b) being hereby defined to be an Indenture Event of Default, not including any periods of grace provided for therein and irrespective of the giving of any notice provided therein); provided that, except for a default in the payment of principal of (or premium, if any) or interest on any of the Junior Subordinated Notes, the Property Trustee shall be protected in withholding such notice if and so long as a Responsible Officer of the Property Trustee in good faith determines that the withholding of such notice is in the interests of the Holders of the Securities. (b) The Property Trustee shall not be deemed to have knowledge of any default except: (i) a default under Section 501(1), 501(2) or 501(3) of the Indenture; or (ii) any default as to which the Property Trustee shall have received written notice pursuant to Section 3.10(a)(xiv) or of which a Responsible Officer of the Property Trustee charged with the administration of this Trust Agreement shall have actual knowledge. 12 ARTICLE 3 ORGANIZATION SECTION 3.1 Name and Organization. The Trust hereby continued is named "Virginia Power Capital Trust II" as such name may be modified from time to time by the Administrative Trustees following written notice to the Holders of Securities, the Property Trustee and the Delaware Trustee. The Trust's activities may be conducted under the name of the Trust or any other name deemed advisable by the Administrative Trustees. SECTION 3.2 Office. The address of the principal office of the Trust is c/o Virginia Electric and Power Company, One James River Plaza, 701 East Cary Street, Richmond, Virginia 23219. On ten (10) Business Days' written notice to the Holders of Securities, the Property Trustee and the Delaware Trustee, the Administrative Trustees may designate another principal office. SECTION 3.3 Purpose. The exclusive purposes and functions of the Trust are (a) to issue and sell Securities and use the gross proceeds from such sale to acquire the Junior Subordinated Notes, and (b) except as otherwise limited herein, to engage in only those other activities necessary or incidental thereto. The Trust shall not borrow money, issue debt or reinvest proceeds derived from investments, pledge any of its assets or otherwise undertake (or permit to be undertaken) any activity that would cause the Trust not to be classified as a grantor trust for United States federal income tax purposes. By the acceptance of this Trust, none of the Trustees, the Sponsor, the Holders of the Trust Preferred Securities or Common Securities or the Beneficial Owners will take any position for United States federal income tax purposes which is contrary to the classification of the Trust as a grantor trust. SECTION 3.4 Authority. Subject to the limitations provided in this Trust Agreement and to the specific duties of the Property Trustee, the Administrative Trustees shall have exclusive authority to carry out the purposes of the Trust. An action taken by the Administrative Trustees in accordance with their powers shall constitute the act of and serve to bind the Trust and an action taken by the Property Trustee on behalf of the Trust in accordance with its powers shall constitute the act of and serve to bind the Trust. In dealing with the Trustees acting on behalf of the Trust, no Person shall be required to inquire into the authority of the Trustees to bind the Trust. Persons dealing with the 13 Trust are entitled to rely conclusively on the power and authority of the Trustees as set forth in this Trust Agreement. (a) Except as expressly set forth in this Trust Agreement and except if a meeting of the Administrative Trustees is called with respect to any matter over which the Administrative Trustees have power to act, any power of the Administrative Trustees may be exercised by, or with the consent of, any one such Administrative Trustee. (b) Unless otherwise determined by the Administrative Trustees, and except as otherwise required by the Business Trust Act or applicable law, any Administrative Trustee is authorized to execute on behalf of the Trust any documents which the Administrative Trustees have the power and authority to cause the Trust to execute pursuant to Section 3.6(b), provided, that the registration statements referred to in Section 3.6(b)(ii), including any amendments thereto, shall be signed by or on behalf of a majority of the Administrative Trustees; and (c) Any Administrative Trustee may, by power of attorney consistent with applicable law, delegate to any other natural person over the age of 21 his or her power for the purposes of signing any documents which the Administrative Trustees have power and authority to cause the Trust to execute pursuant to Section 3.6. SECTION 3.5 Title to Property of the Trust. Except as provided in Section 3.8 with respect to the Junior Subordinated Notes and the Property Account or as otherwise provided in this Trust Agreement, legal title to all assets of the Trust shall be vested in the Trust. The Holders shall not have legal title to any part of the assets of the Trust, but shall have an undivided beneficial ownership interest in the assets of the Trust. SECTION 3.6 Powers and Duties of the Administrative Trustees. The Administrative Trustees shall have the exclusive power, duty and authority to cause the Trust to engage in the following activities: (a) issue and sell the Trust Preferred Securities and the Common Securities in accordance with this Trust Agreement; provided, however, that the Trust may issue no more than one series of Trust Preferred Securities and no more than one series of Common Securities, and, provided further, that there shall be no interests in the Trust other than the Securities, and, except as provided in Section 7.13, the issuance of Securities shall be limited to a one- time, simultaneous issuance of both Trust Preferred Securities and Common Securities on the Closing Date; (b) in connection with the issue and sale of the Trust Preferred Securities, at the direction of the Sponsor, to: (i) execute and file an application, prepared by the Sponsor, to the New York Stock Exchange or any other national stock exchange or automated quotation system for listing of any Trust Preferred Securities, the Guarantee and the Junior Subordinated Notes; 14 (ii) execute and file with the Commission one or more registration statements on the applicable forms prepared by the Sponsor, including any amendments thereto, pertaining to the Trust Preferred Securities, the Guarantee and the Junior Subordinated Notes; (iii) execute and file any documents prepared by the Sponsor, or take any acts as determined by the Sponsor to be necessary, in order to qualify or register all or part of the Trust Preferred Securities in any State in which the Sponsor has determined to qualify or register such Trust Preferred Securities for sale; and (iv) negotiate the terms of and execute and enter into an underwriting agreement and other related agreements providing for the sale of the Trust Preferred Securities; (c) to acquire the Junior Subordinated Notes with the proceeds of the sale of the Trust Preferred Securities and the Common Securities; provided, however, that the Administrative Trustees shall cause legal title to the Junior Subordinated Notes to be held of record in the name of the Property Trustee for the benefit of the Holders of the Trust Preferred Securities and the Holders of the Common Securities; (d) to give the Sponsor and the Property Trustee prompt written notice of the occurrence of a Special Event; provided that the Administrative Trustees shall consult with the Sponsor before taking or refraining from taking any action in relation to any such Special Event; (e) to establish a record date with respect to all actions to be taken hereunder that require a record date be established, including and with respect to, for the purposes of Section 316(c) of the Trust Indenture Act, Distributions, voting rights, redemptions and exchanges, and to issue relevant notices to the Holders of Trust Preferred Securities and Holders of Common Securities as to such actions and applicable record dates; (f) to take all actions and perform such duties as may be required of the Administrative Trustees pursuant to the terms of this Trust Agreement and the Securities; (g) to bring or defend, pay, collect, compromise, arbitrate, resort to legal action or otherwise adjust claims or demands of or against the Trust ("Legal Action"), unless pursuant to Section 3.8(e), the Property Trustee has the exclusive power to bring such Legal Action; (h) to employ or otherwise engage employees and agents (who may be designated as officers with titles) and managers, contractors, advisors and consultants to conduct only those services that the Administrative Trustees have authority to conduct directly, and to and pay reasonable compensation for such services; (i) to cause the Trust to comply with the Trust's obligations under the Trust Indenture Act; (j) to give the certificate required by Section 314(a)(4) of the Trust Indenture Act to the Property Trustee, which certificate may be executed by any Administrative Trustee; 15 (k) to incur expenses that are necessary or incidental to carry out any of the purposes of the Trust; (l) to act as, or appoint another Person to act as, registrar and transfer agent for the Securities; (m) to give prompt written notice to the Holders of the Securities of any notice received from the Junior Subordinated Note Issuer of its election to defer payments of interest on the Junior Subordinated Notes by extending the interest payment period under the Junior Subordinated Notes as authorized by the Indenture; (n) to take all action that may be necessary or appropriate for the preservation and the continuation of the Trust's valid existence, rights, franchises and privileges as a statutory business trust under the laws of the State of Delaware and of each other jurisdiction in which such existence is necessary to protect the limited liability of the Holders of the Trust Preferred Securities and the Holders of the Common Securities or to enable the Trust to effect the purposes for which the Trust was created; (o) to take any action, not inconsistent with applicable law, that the Administrative Trustees determine in their discretion to be necessary or desirable in carrying out the purposes and functions of the Trust as set out in Section 3.3 or the activities of the Trust as set out in this Section 3.6, including, but not limited to: (i) causing the Trust not to be deemed to be an Investment Company required to be registered under the Investment Company Act; (ii) causing the Trust to be classified as a grantor trust for United States federal income tax purposes; and (iii) cooperating with the Junior Subordinated Note Issuer to ensure that the Junior Subordinated Notes will be treated as indebtedness of the Junior Subordinated Note Issuer for United States federal income tax purposes. (p) to take all action necessary to cause all applicable tax returns and tax information reports that are required to be filed with respect to the Trust to be duly prepared and filed by the Administrative Trustees, on behalf of the Trust; and (q) to execute and deliver all documents or instruments, perform all duties and powers, and do all things for and on behalf of the Trust in all matters necessary or incidental to the foregoing. The Administrative Trustees shall exercise the powers set forth in this Section 3.6 in a manner that is consistent with the purposes and functions of the Trust set out in Section 3.3, and the Administrative Trustees shall have no power to, and shall not, take any action that is inconsistent with the purposes and functions of the Trust set forth in Section 3.3. 16 Subject to this Section 3.6, the Administrative Trustees shall have none of the powers or the authority of the Property Trustee set forth in Section 3.8. Any expenses incurred by the Administrative Trustees pursuant to this Section 3.6 shall be reimbursed by the Junior Subordinated Note Issuer. SECTION 3.7 Prohibition of Actions by the Trust and the Trustees. (a) The Trust shall not, and none of the Trustees (including the Property Trustee) shall cause the Trust to, engage in any activity other than as required or authorized by this Trust Agreement. In particular, the Trust shall not and none of the Trustees (including the Property Trustee) shall cause the Trust to: (i) invest any proceeds received by the Trust from holding the Junior Subordinated Notes, but shall distribute all such proceeds to Holders of Securities pursuant to the terms of this Trust Agreement and of the Securities; (ii) acquire any assets other than as expressly provided herein; (iii) possess Trust property for other than a Trust purpose; (iv) make any loans other than loans represented by the Junior Subordinated Notes or incur any indebtedness; (v) possess any power or otherwise act in such a way as to vary the Trust assets; (vi) possess any power or otherwise act in such a way as to vary the terms of the Securities in any way whatsoever (except to the extent expressly authorized in this Trust Agreement or by the terms of the Securities); (vii) issue any securities or other evidences of beneficial ownership of, or beneficial interest in, the Trust other than the Securities; (viii) other than as provided in this Trust Agreement or by the terms of the Securities, (A) direct the time, method and place of exercising any trust or power conferred upon the Indenture Trustee with respect to the Junior Subordinated Notes, (B) waive any past default that is waivable under the Indenture, (C) exercise any right to rescind or annul any declaration that the principal of all the Junior Subordinated Notes shall be due and payable, or (D) consent to any amendment, modification or termination of the Indenture or the Junior Subordinated Notes where such consent shall be required unless the Trust shall have received an opinion of counsel to the effect that such amendment or modification will not cause more than an insubstantial risk that the Trust will be deemed an Investment Company required to be registered under the Investment Company Act, or the Trust will not be classified as a grantor trust for United States federal income tax purposes; 17 (ix) take any action inconsistent with the status of the Trust as a grantor trust for United States federal income tax purposes; or (x) revoke any action previously authorized or approved by vote of the Holders of the Trust Preferred Securities except pursuant to a subsequent vote of the Holders of the Trust Preferred Securities. SECTION 3.8 Powers and Duties of the Property Trustee. (a) The legal title to the Junior Subordinated Notes shall be owned by and held of record in the name of the Property Trustee for the benefit of the Trust and the Holders of the Securities. The right, title and interest of the Property Trustee to the Junior Subordinated Notes shall vest automatically in each Person who may hereafter be appointed as Property Trustee in accordance with Section 6.6. Such vesting and cessation of title shall be effective whether or not conveyancing documents with regard to the Junior Subordinated Notes have been executed and delivered. (b) The Property Trustee shall not transfer its right, title and interest in the Junior Subordinated Notes to the Administrative Trustees or to the Delaware Trustee (if the Property Trustee does not also act as Delaware Trustee). (c) The Property Trustee shall: (i) establish and maintain a segregated non-interest bearing trust account (the "Property Account") in the name of and under the exclusive control of the Property Trustee on behalf of the Holders of the Securities and, upon the receipt of payments of funds made in respect of the Junior Subordinated Notes held by the Property Trustee, deposit such funds into the Property Account and make payments to the Holders of the Trust Preferred Securities and Holders of the Common Securities from the Property Account in accordance with Section 7.2. Funds in the Property Account shall be held uninvested until disbursed in accordance with this Trust Agreement. The Property Account shall be an account that is maintained with a banking institution the rating on whose long-term unsecured indebtedness is at least equal to the rating assigned to the Trust Preferred Securities by a "nationally recognized statistical rating organization", within the meaning of Rule 436(g)(2) under the Securities Act; (ii) engage in such ministerial activities as shall be necessary or appropriate to effect the redemption of the Trust Preferred Securities and the Common Securities to the extent the Junior Subordinated Notes are redeemed or mature; and (iii) upon written notice of distribution issued by the Administrative Trustees in accordance with the terms of the Securities, engage in such ministerial activities as so directed and as shall be necessary or appropriate to effect the distribution of the Junior Subordinated Notes to Holders of Securities upon the occurrence of a Special Event. 18 (d) The Property Trustee shall take all actions and perform such duties as may be specifically required of the Property Trustee pursuant to the terms of this Trust Agreement and the Securities. (e) Subject to Section 3.9(a) the Property Trustee may take any Legal Action which arises out of or in connection with a Trust Enforcement Event of which a Responsible Officer of the Property Trustee has actual knowledge or the Property Trustee's duties and obligations under this Trust Agreement or the Trust Indenture Act; PROVIDED, HOWEVER, that if a Trust Enforcement Event has occurred and is continuing and such event is attributable to the failure of the Junior Subordinated Note Issuer to pay interest, principal or other required payments on the Junior Subordinated Notes on the date such interest, principal or other required payments are otherwise payable (or in the case of redemption, on the redemption date), then, any Holder of Trust Preferred Securities shall have the right, to institute a suit directly against the Sponsor (a "Direct Action") for enforcement of payment to such Holder of principal of (including premium, if any) and interest (including any Additional Interest) on Junior Subordinated Notes having a principal amount equal to the aggregate liquidation amount of such Trust Preferred Securities. Notwithstanding anything to the contrary in this Trust Agreement or the Indenture, the Junior Subordinated Note Issuer shall have the right to set-off any payment it is otherwise required to make under the Indenture in respect of any Trust Preferred Security to the extent the Junior Subordinated Note Issuer has heretofore made, or is currently on the date of such payment making, a payment under the Guarantee relating to such Trust Preferred Security or under Section 516 of the Indenture. (f) The Property Trustee shall continue to serve as a Trustee until either: (i) the Trust has been completely liquidated and the proceeds of the liquidation distributed to the Holders of Securities pursuant to the terms of the Securities; or (ii) a Successor Property Trustee has been appointed and has accepted that appointment in accordance with Section 6.6. (g) The Property Trustee shall have the legal power to exercise all of the rights, powers and privileges of a holder of Junior Subordinated Notes under the Indenture and, if a Trust Enforcement Event actually known to a Responsible Officer of the Property Trustee occurs and is continuing, the Property Trustee may, for the benefit of Holders of the Securities, enforce its rights as holder of the Junior Subordinated Notes subject to the rights of the Holders pursuant to this Trust Agreement and the terms of the Securities. (h) Subject to this Section 3.8, the Property Trustee shall have none of the duties, liabilities, powers or the authority of the Administrative Trustees set forth in Section 3.6. The Property Trustee shall exercise the powers set forth in this Section 3.8 in a manner that is consistent with the purposes and functions of the Trust set out in Section 3.3, and the Property Trustee shall have no power to, and shall not, take any action that is inconsistent with the purposes and functions of the Trust set out in Section 3.3. 19 SECTION 3.9 Certain Duties and Responsibilities of the Property Trustee. (a) The Property Trustee, before the occurrence of any Trust Enforcement Event and after the curing of all Trust Enforcement Events that may have occurred, shall undertake to perform only such duties as are specifically set forth in this Trust Agreement and no implied covenants shall be read into this Trust Agreement against the Property Trustee. In case a Trust Enforcement Event has occurred (that has not been cured or waived pursuant to Section 2.6) of which a Responsible Officer of the Property Trustee has actual knowledge, the Property Trustee shall exercise such of the rights and powers vested in it by this Trust Agreement, and use the same degree of care and skill in their exercise, as a prudent person would exercise or use under the circumstances in the conduct of his or her own affairs. (b) No provision of this Trust Agreement shall be construed to relieve the Property Trustee from liability for its own negligent action, its own negligent failure to act or its own willful misconduct, except that: (i) prior to the occurrence of a Trust Enforcement Event and after the curing or waiving of all such Trust Enforcement Events that may have occurred: a. the duties and obligations of the Property Trustee shall be determined solely by the express provisions of this Trust Agreement and the Property Trustee shall not be liable except for the performance of such duties and obligations as are specifically set forth in this Trust Agreement, and no implied covenants or obligations shall be read into this Trust Agreement against the Property Trustee; and b. in the absence of bad faith on the part of the Property Trustee, the Property Trustee may conclusively rely, as to the truth of the statements and the correctness of the opinions expressed therein, upon any certificates or opinions furnished to the Property Trustee and conforming to the requirements of this Trust Agreement; but in the case of any such certificates or opinions that by any provision hereof are specifically required to be furnished to the Property Trustee, the Property Trustee shall be under a duty to examine the same to determine whether or not they conform to the requirements of this Trust Agreement; (ii) the Property Trustee shall not be liable for any error of judgment made in good faith by a Responsible Officer of the Property Trustee, unless it shall be proved that the Property Trustee was negligent in ascertaining the pertinent facts; (iii) the Property Trustee shall not be liable with respect to any action taken or omitted to be taken by it without negligence, in good faith in accordance with the direction of the Holders of not less than a Majority in Liquidation Amount of the Securities relating to the time, method and place of conducting any proceeding for any remedy available to the Property Trustee, or exercising any trust or power conferred upon the Property Trustee under this Trust Agreement; 20 (iv) no provision of this Trust Agreement shall require the Property Trustee to expend or risk its own funds or otherwise incur personal financial liability in the performance of any of its duties or in the exercise of any of its rights or powers, if it shall have reasonable grounds for believing that the repayment of such funds or liability is not reasonably assured to it under the terms of this Trust Agreement or indemnity reasonably satisfactory to the Property Trustee against such risk or liability is not reasonably assured to it; (v) the Property Trustee's sole duty with respect to the custody, safe-keeping and physical preservation of the Junior Subordinated Notes and the Property Account shall be to deal with such property in a similar manner as the Property Trustee deals with similar property for its own account, subject to the protections and limitations on liability afforded to the Property Trustee under this Trust Agreement and the Trust Indenture Act; (vi) the Property Trustee shall have no duty or liability for or with respect to the value, genuineness, existence or sufficiency of the Junior Subordinated Notes or the payment of any taxes or assessments levied thereon or in connection therewith; (vii) the Property Trustee shall not be liable for any interest on any money received by it except as it may otherwise agree with the Sponsor. Money held by the Property Trustee need not be segregated from other funds held by it except in relation to the Property Account maintained by the Property Trustee pursuant to Section 3.8(c)(i) and except to the extent otherwise required by law; and (viii) the Property Trustee shall not be responsible for monitoring the compliance by the Administrative Trustees or the Sponsor with their respective duties under this Trust Agreement, nor shall the Property Trustee be liable for any default or misconduct of the Administrative Trustees or the Sponsor. SECTION 3.10 Certain Rights of Property Trustee. (a) Subject to the provisions of Section 3.9: (i) the Property Trustee may conclusively rely and shall be fully protected in acting or refraining from acting upon any resolution, certificate, statement, instrument, opinion, report, notice, request, direction, consent, order, bond, debenture, note, other evidence of indebtedness or other paper or document believed by it to be genuine and to have been signed, sent or presented by the proper party or parties; (ii) any direction or act of the Sponsor or the Administrative Trustees contemplated by this Trust Agreement shall be sufficiently evidenced by an Officers' Certificate; (iii) whenever in the administration of this Trust Agreement, the Property Trustee shall deem it desirable that a matter be proved or established before taking, suffering or omitting any action hereunder, the Property Trustee (unless other evidence is herein specifically prescribed) may, in the absence of bad faith on its part, request and conclusively rely upon an 21 Officers' Certificate which, upon receipt of such request, shall be promptly delivered by the Sponsor or the Administrative Trustees; (iv) the Property Trustee shall have no duty to see to any recording, filing or registration of any instrument (including any financing or continuation statement or any filing under tax or securities laws) or any rerecording, refiling or registration thereof; (v) the Property Trustee may consult with counsel of its choice or other experts and the advice or opinion of such counsel and experts with respect to legal matters or advice within the scope of such experts' area of expertise shall be full and complete authorization and protection in respect of any action taken, suffered or omitted by it hereunder in good faith and in accordance with such advice or opinion, such counsel may be counsel to the Property Trustee or the Sponsor or any of its Affiliates, and may include any of its employees. The Property Trustee shall have the right at any time to seek instructions concerning the administration of this Trust Agreement from any court of competent jurisdiction; (vi) the Property Trustee shall be under no obligation to exercise any of the rights or powers vested in it by this Trust Agreement at the request or direction of any Holder, unless such Holder shall have provided to the Property Trustee security and indemnity, reasonably satisfactory to the Property Trustee, against the costs, expenses (including attorneys' fees and expenses and the expenses of the Property Trustee's agents, nominees or custodians) and liabilities that might be incurred by it in complying with such request or direction, including such reasonable advances as may be requested by the Property Trustee; provided that, nothing contained in this Section 3.10(a) shall be taken to relieve the Property Trustee, upon the occurrence of a Trust Enforcement Event, of its obligation to exercise the rights and powers vested in it by this Trust Agreement in the manner provided by Section 3.9(a); (vii) the Property Trustee shall not be bound to make any investigation into the facts or matters stated in any resolution, certificate, statement, instrument, opinion, report, notice, request, direction, consent, order, bond, debenture, note, other evidence of indebtedness or other paper or document, but the Property Trustee, in its discretion, may make such further inquiry or investigation into such facts or matters as it may see fit; (viii) the Property Trustee may execute any of the trusts or powers hereunder or perform any duties hereunder either directly or by or through agents, custodians, nominees or attorneys and the Property Trustee shall not be responsible for any misconduct or negligence on the part of any agent or attorney appointed with due care by it hereunder; (ix) any action taken by the Property Trustee or its agents hereunder shall bind the Trust and the Holders of the Securities, and the signature of the Property Trustee or its agents alone shall be sufficient and effective to perform any such action and no third party shall be required to inquire as to the authority of the Property Trustee to so act or as to its compliance with any of the terms and provisions of this Trust Agreement, both of which shall be conclusively evidenced by the Property Trustee's or its agent's taking such action; 22 (x) whenever in the administration of this Trust Agreement the Property Trustee shall deem it desirable to receive instructions with respect to enforcing any remedy or right or taking any other action hereunder, the Property Trustee (i) may request instructions from the Holders of the Securities which instructions may only be given by the Holders of the same proportion in liquidation amount of the Securities as would been entitled to direct the Property Trustee under the terms of the Securities in respect of such remedy, right or action, (ii) may refrain from enforcing such remedy or right or taking such other action until such instructions are received, and (iii) shall be protected in conclusively relying on or acting in or accordance with such instructions; (xi) except as otherwise expressly provided by this Trust Agreement, the Property Trustee shall not be under any obligation to take any action that is discretionary under the provisions of this Trust Agreement; (xii) the Property Trustee shall not be personally liable for the payment of any indebtedness or expenses of the Trust or be liable for the breach or failure of any obligation, representation, warranty or covenant made or undertaken by the Trust under this Trust Agreement, except if such breach or failure is due to any gross negligence or willful misconduct of the Property Trustee.; (xiii) without prejudice to any other rights available to the Property Trustee under applicable law, when the Property Trustee incurs expenses or renders services in connection with a bankruptcy, such expenses (including the fees and expenses of its counsel) and the compensation for such services are intended to constitute expenses of administration under any bankruptcy law or law relating to creditors rights generally; (xiv) the Property Trustee shall not be charged with knowledge of a Trust Enforcement Event unless a Responsible Officer of the Property Trustee obtains actual knowledge of such event or the Property Trustee receives written notice of such event from Holders holding more than a Majority in Liquidation Amount of the Trust Preferred Securities; and (b) No provision of this Trust Agreement shall be deemed to impose any duty or obligation on the Property Trustee to perform any act or acts or exercise any right, power, duty or obligation conferred or imposed on it, in any jurisdiction in which it shall be illegal, or in which the Property Trustee shall be unqualified or incompetent in accordance with applicable law, to perform any such act or acts, or to exercise any such right, power, duty or obligation. No permissive power or authority available to the Property Trustee shall be construed to be a duty. SECTION 3.11 Delaware Trustee. Notwithstanding any other provision of this Trust Agreement other than Section 6.2, the Delaware Trustee shall not be entitled to exercise any powers, nor shall the Delaware Trustee have any of the duties and responsibilities of the Administrative Trustees or the Property Trustee described in this Trust Agreement. Except as set forth in Section 6.2, the Delaware Trustee shall be a Trustee for the sole and limited purpose of fulfilling the requirements of Section 3807(a) of 23 the Business Trust Act. In the event the Delaware Trustee shall at any time be required to take any action or perform any duty hereunder with respect to the Trust, the Delaware Trustee shall be entitled to all of the same rights as the Property Trustee listed in Section 3.9(b) and Section 3.10. No implied covenants or obligations shall be read into this Trust Agreement against the Delaware Trustee. It is expressly understood and agreed by the parties hereto that in fulfilling its obligations as Delaware Trustee hereunder on behalf of the Trust (i) any agreements or instruments executed and delivered by Chase Manhattan Bank Delaware are executed and delivered not in its individual capacity but solely as Delaware Trustee under this Trust Agreement in the exercise of the powers and authority conferred and vested in it, (ii) each of the representations, undertakings and agreements herein made on the part of the Trust is made and intended not as representations, warranties, covenants, undertakings and agreements by Chase Manhattan Bank Delaware in its individual capacity but is made and intended for the purpose of binding only the Trust, and (iii) under no circumstances shall Chase Manhattan Bank Delaware in its individual capacity be personally liable for the payment of any indebtedness or expenses of the Trust or be liable for the breach or failure of any obligation, representation, warranty or covenant made or undertaken by the Trust under this Trust Agreement, except if such breach or failure is due to any gross negligence or willful misconduct of the Delaware Trustee. SECTION 3.12 Execution of Documents. Unless otherwise determined by the Administrative Trustees, and except as otherwise required by the Business Trust Act or applicable law, any Administrative Trustee is authorized to execute on behalf of the Trust any documents that the Administrative Trustees have the power and authority to execute pursuant to Section 3.6; provided that, the registration statements referred to in Section 3.6(b)(ii), including any amendments thereto, shall be signed by or on behalf of a majority of the Administrative Trustees. SECTION 3.13 Not Responsible for Recitals or Issuance of Securities. The recitals contained in this Trust Agreement and the Securities shall be taken as the statements of the Sponsor, and the Trustees do not assume any responsibility for their correctness. The Trustees make no representations as to the value or condition of the property of the Trust or any part thereof. The Trustees make no representations as to the validity or sufficiency of this Trust Agreement, the Securities, the Junior Subordinated Notes or the Indenture. SECTION 3.14 Duration of Trust. The Trust shall exist until terminated pursuant to the provisions of Article 8 hereof. SECTION 3.15 Mergers. (a) The Trust may not consolidate, amalgamate, merge with or into, or be replaced by, or convey, transfer or lease its properties and assets substantially as an entirety to any Person, except as described in Section 3.15(b) and (c) or Section 8.2. 24 (b) The Trust may, at the request of the Sponsor and with the consent of the Administrative Trustees or, if there are more than two, a majority of the Administrative Trustees and without the consent of the Holders of the Securities, the Delaware Trustee or the Property Trustee, consolidate, amalgamate, merge with or into, or be replaced by or convey, transfer or lease its properties substantially as an entirety to a trust organized as such under the laws of any State; provided, that: (i) if the Trust is not the successor, such successor entity (the "Successor Entity") either: a. expressly assumes all of the obligations of the Trust with respect to the Securities; or b. substitutes for the Trust Preferred Securities other securities having substantially the same terms as the Trust Preferred Securities (the "Successor Securities") so long as the Successor Securities rank the same as the Trust Preferred Securities rank in priority with respect to Distributions and payments upon liquidation, redemption and otherwise; (ii) if the Trust is not the successor Entity, the Sponsor expressly appoints a trustee of such Successor Entity that possesses the same powers and duties as the Property Trustee as the holder of the Junior Subordinated Notes; (iii) the Trust Preferred Securities or any Successor Securities are listed, or any Successor Securities will be listed upon notification of issuance, on any national securities exchange or with any other or organization on which the Trust Preferred Securities are then listed or quoted; (iv) such merger, consolidation, amalgamation, replacement, conveyance, transfer or lease does not cause the Trust Preferred Securities (including any Successor Securities) to be downgraded by any nationally recognized statistical rating organization; (v) such merger, consolidation, amalgamation, replacement, conveyance, transfer or lease does not adversely affect the rights, preferences and privileges of the Holders of the Trust Preferred Securities (including any Successor Securities) in any material respect; (vi) such Successor Entity has a purpose substantially identical to that of the Trust; (vii) prior to such merger, consolidation, amalgamation, replacement, conveyance, transfer or lease the Sponsor has received an opinion of independent counsel to the Trust experienced in such matters to the effect that: a. such merger, consolidation, amalgamation, replacement, conveyance, transfer or lease does not adversely affect the rights, preferences and privileges of the Holders of the Trust Preferred Securities (including any Successor Securities) in any material respect; 25 b. following such merger, consolidation, amalgamation, replacement, conveyance, transfer or lease neither the Trust nor the Successor Entity will be required to register as an Investment Company; and c. following such merger, consolidation, amalgamation or replacement, the Trust (or the Successor Entity) will continue to be classified as a grantor trust for United States federal income tax purposes; (viii) the Sponsor or any permitted successor or assignee owns all of the common securities and guarantees the obligations of such Successor Entity under the Successor Securities at least to the extent provided by the Guarantee; and (ix) such Successor Entity expressly assumes all of the obligations of the Trust with respect to the Trustees. (c) Notwithstanding Section 3.15(b), the Trust shall not, except with the consent of Holders of 100% in aggregate liquidation amount of the Securities, consolidate, amalgamate, merge with or into, or be replaced by or convey, transfer or lease its properties and assets substantially as an entirety to, any other entity or permit any other entity to consolidate, amalgamate, merge with or into, or replace it, if such consolidation, amalgamation, merger, replacement, conveyance, transfer or lease would cause the Trust or Successor Entity to be classified as other than a grantor trust for United States federal income tax purposes and each Holder of the Securities not to be treated as owning an undivided interest in the Junior Subordinated Notes. SECTION 3.16 Property Trustee May File Proofs of Claim. In case of the pendency of any receivership, insolvency, liquidation, bankruptcy, reorganization, arrangement, adjustment, composition or other similar judicial proceeding relative to the Trust or any other obligor upon the Securities or the property of the Trust or of such other obligor or their creditors, the Property Trustee (irrespective of whether any Distributions on the Securities shall then be due and payable as therein expressed or by declaration or otherwise and irrespective of whether the Property Trustee shall have made any demand on the Trust for the payment of any past due Distributions) shall be entitled and empowered, to the fullest extent permitted by law, by intervention in such proceeding or otherwise: (a) to file and prove a claim for the whole amount of any Distributions owing and unpaid in respect of the Securities (or, if the Securities are original issue discount Securities, such portion of the liquidation amount as may be specified in the terms of such Securities) and to file such other papers or documents as may be necessary or advisable in order to have the claims of the Property Trustee (including any claim for the reasonable compensation, expenses, disbursements and advances of the Property Trustee, its agents and counsel) and of the Holders allowed in such judicial proceeding, and 26 (b) to collect and receive any moneys or other property payable or deliverable on any such claims and to distribute the same; and any custodian, receiver, assignee, trustee, liquidator, sequestrator or other similar official in any such judicial proceeding is hereby authorized by each Holder to make such payments to the Property Trustee and, in the event the Property Trustee shall consent to the making of such payments directly to the Holders, to pay to the Property Trustee any amount due it for the reasonable compensation, expenses, disbursements and advances of the Property Trustee, its agents and counsel, and any other amounts due the Property Trustee. Nothing herein contained shall be deemed to authorize the Property Trustee to authorize or consent to or accept or adopt on behalf of any Holder any plan of reorganization, arrangement adjustment or compensation affecting the Securities or the rights of any Holder thereof or to authorize the Property Trustee to vote in respect of the claim of any Holder in any such proceeding. ARTICLE 4 SPONSOR SECTION 4.1 Responsibilities of the Sponsor. In connection with the issue and sale of the Trust Preferred Securities, the Sponsor shall have the exclusive right and responsibility to engage in the following activities: (a) to prepare for filing by the Trust with the Commission under the Securities Act or the Exchange Act one or more registration statements on the applicable forms, including any amendments thereto, pertaining to the Trust Preferred Securities, the Guarantee and the Junior Subordinated Notes; (b) to determine the States in which to take appropriate action to qualify or register for sale all or part of the Trust Preferred Securities and to do any and all such acts, other than actions which must be taken by the Trust, and advise the Trust of actions it must take, and prepare for execution and filing any documents to be executed and filed by the Trust, as the Sponsor deems necessary or advisable in order to comply with the applicable laws of any such States; (c) to prepare for filing by the Trust an application to the New York Stock Exchange, Inc. or any other national stock exchange or the NASDAQ Stock Market for listing upon notice of issuance of any Trust Preferred Securities, the Guarantee and the Junior Subordinated Notes; and (d) to negotiate the terms of and to execute on behalf of the Trust an underwriting agreement and other related agreements providing for the sale of the Trust Preferred Securities. SECTION 4.2 Indemnification and Fees and Expenses of the Trustees. 27 The Sponsor, in its capacity as Junior Subordinated Note Issuer, agrees (a) to pay to the Property Trustee and the Delaware Trustee from time to time such compensation as shall be agreed in writing with the Sponsor for all services rendered by them hereunder (which compensation shall not be limited by any provision of law in regard to the compensation of a trustee of an express trust); (b) to reimburse the Property Trustee and the Delaware Trustee upon request for all reasonable expenses, disbursements and advances incurred or made by such Trustee in accordance with any provision of this Trust Agreement (including the reasonable compensation and the reasonable expenses and disbursements of their duly authorized agents and counsel), except any such expense, disbursement or advance as may be attributable to their negligence or bad faith; and (c) to indemnify the Property Trustee and the Delaware Trustee for, and to hold each of them harmless against, any loss, liability or expense incurred without negligence or bad faith on the part of the Property Trustee or the Delaware Trustee, as the case may be, arising out of or in connection with the acceptance or administration of the trust or trusts hereunder, including the costs and expenses of defending either of them against any claim or liability in connection with the exercise or performance of any of their respective powers or duties hereunder; the provisions of this Section 4.2 shall survive the resignation or removal of the Delaware Trustee or the Property Trustee or the termination of this Trust Agreement. ARTICLE 5 TRUST COMMON SECURITIES HOLDER SECTION 5.1 Junior Subordinated Note Issuer's Purchase of Common Securities. On the applicable Closing Date, the Junior Subordinated Note Issuer will purchase all of the Common Securities issued by the Trust on such Closing Date, for an amount at least equal to 3% of the capital of the Trust at such time, at the same time as Trust Preferred Securities are sold; PROVIDED that, if the Option set forth in Section 7.13(a) is exercised, then the Junior Subordinated Note Issuer will purchase such additional Common Securities from the Trust on such second Closing Date such that it will then hold at least 3% of the capital of the Trust. The aggregate stated liquidation amount of Common Securities outstanding at any time shall not be less than 3% of the capital of the Trust. SECTION 5.2 Covenants of the Common Securities Holder. For so long as the Trust Preferred Securities remain outstanding, the Common Securities Holder will covenant (i) to maintain, directly or indirectly, 100% ownership of the Common Securities, (ii) to cause the Trust to remain a statutory business trust and not to voluntarily dissolve, wind up, liquidate or be terminated, except as permitted by this Trust Agreement, (iii) to use its commercially reasonable efforts to ensure that the Trust will not be an investment 28 company for purposes of the Investment Company Act, and (iv) to take no action which would be reasonably likely to cause the Trust to be classified as an association or a publicly traded partnership taxable as a corporation for United States federal income tax purposes. ARTICLE 6 TRUSTEES SECTION 6.1 Number of Trustees. The number of Trustees initially shall be five, and: (a) at any time before the issuance of any Securities, the Sponsor may, by written instrument, increase or decrease the number of Trustees; and (b) after the issuance of any Securities, the number of Trustees may be increased or decreased by vote of the Holders of a Majority in Liquidation Amount of the Common Securities voting as a class at a meeting of the Holders of the Common Securities or by written consent in lieu of such meeting; provided that the number of Trustees shall be at least three; and provided further that (i) the Delaware Trustee, in the case of a natural person, shall be a person who is a resident of the State of Delaware or that, if not a natural person, is an entity which has its principal place of business in the State of Delaware and otherwise meets the requirements of applicable law; (ii) at least one Administrative Trustee is an employee or officer of, or is affiliated with, the Sponsor; and (iii) one Trustee shall be the Property Trustee for so long as this Trust Agreement is required to qualify as an indenture under the Trust Indenture Act, and such Trustee may also serve as Delaware Trustee if it meets the applicable requirements. SECTION 6.2 Delaware Trustee; Eligibility. If required by the Business Trust Act, one Trustee (which may be the Property Trustee) (the "Delaware Trustee") shall be: (a) a natural person who is a resident of the State of Delaware; or (b) if not a natural person, an entity which has its principal place of business in the State of Delaware, and otherwise meets the requirements of applicable law, provided that, if the Property Trustee has its principal place of business in the State of Delaware and otherwise meets the requirements of applicable law, then the Property Trustee shall also be the Delaware Trustee and Section 3.11 shall have no application. SECTION 6.3 Property Trustee; Eligibility. (a) There shall at all times be one Trustee (which may be the Delaware Trustee) which shall act as Property Trustee which shall: 29 (i) not be an Affiliate of the Sponsor; and (ii) be a corporation organized and doing business under the laws of the United States of America or any State or Territory thereof or of the District of Columbia, or a corporation or other Person permitted by the Commission to act as an institutional trustee under the Trust Indenture Act, authorized under such laws to exercise corporate trust owners, having a combined capital and surplus of at least 50 million U.S. dollars ($50,000,000), and subject to supervision or examination by federal, State, Territorial or District of Columbia authority. If such corporation publishes reports of condition at least annually, pursuant to law or to the requirements of the supervising or examining authority referred to above, then for the purposes of this Section 6.3(a)(ii), the combined capital and surplus of such corporation shall be deemed to be its combined capital and surplus as set forth in its most recent report of condition so published. (b) If at any time the Property Trustee shall cease to be eligible to so act under Section 6.3(a), the Property Trustee shall immediately resign in the manner and with the effect set forth in Section 6.6(c). (c) If the Property Trustee has or shall acquire any "conflicting interest" within the meaning of Section 310(b) of the Trust Indenture Act, the Property Trustee and the Holder of the Common Securities (as if it were the obligor referred to in Section 310(b) of the Trust Indenture Act) shall in all respects comply with the provisions of Section 310(b) of the Trust Indenture Act, subject to the penultimate paragraph thereof. (d) The Guarantee, the Amended and Restated Trust Agreement of Virginia Power Capital Trust I dated as of August 31, 1995 among the Sponsor, The Chase Manhattan Bank (formerly known as Chemical Bank), as Property Trustee, Chase Manhattan Bank Delaware (formerly known as Chemical Bank Delaware), as Delaware Trustee and the Administrative Trustees named therein, and the Guarantee Agreement relating to Virginia Power Capital Trust I dated as of August 31, 1995 between the Sponsor, as Guarantor, and The Chase Manhattan Bank (formerly known as Chemical Bank), as Trustee, shall be deemed to be specifically described in this Trust Agreement for purposes of clause (i) of the first proviso contained in Section 310(b) of the Trust Indenture Act. SECTION 6.4 Qualifications of Administrative Trustees and Delaware Trustee Generally. Each Administrative Trustee and the Delaware Trustee (unless the Property Trustee also acts as Delaware Trustee) shall be either a natural person who is at least 21 years of age or a legal entity that shall act through one or more Authorized Officers. SECTION 6.5 Initial Administrative Trustees. The initial Administrative Trustees shall be: __________, ___________ and __________, the business address of all of whom is c/o Virginia Electric and Power Company, One James River Plaza, 701 East Cary Street, Richmond, Virginia 23219. 30 SECTION 6.6 Appointment, Removal and Resignation of Trustees. (a) Subject to Section 6.6(b), Trustees may be appointed or removed without cause at any time: (i) until the issuance of any Securities, by written instrument executed by the Sponsor; (ii) after the issuance of any Securities (but prior to the occurrence of an Indenture Event of Default), by vote of the Holders of a Majority in Liquidation Amount of the Common Securities voting as a class at a meeting of the Holders of the Common Securities; and; (iii) after the issuance of the Trust Preferred Securities and the occurrence of an Indenture Event of Default, by vote of the Holders of a Majority in Liquidation Amount of the Trust Preferred Securities; provided, however, that the Administrative Trustees may still be appointed or removed without cause in such circumstance, by vote of the Holders of a Majority in Liquidation Amount of the Common Securities voting as a class at a meeting of the Holders of the Common Securities; and; (b) The Trustee that acts as Property Trustee shall not be removed in accordance with Section 6.6(a) until a successor Trustee possessing the qualifications to act as Property Trustee under Section 6.3(a) (a "Successor Property Trustee") has been appointed and has accepted such appointment by written instrument executed by such Successor Property Trustee and delivered to the Administrative Trustees and the Sponsor. The Trustee that acts as Delaware Trustee shall not be removed in accordance with Section 6.6(a) until a successor Trustee possessing the qualifications to act as Delaware Trustee under Sections 6.2 and 6.4 (a "Successor Delaware Trustee") has been appointed and has accepted such appointment by written instrument executed by such Successor Delaware Trustee and delivered to the Administrative Trustees and the Sponsor. (c) A Trustee appointed to office shall hold office until his or its successor shall have been appointed, until his death or its dissolution or until his or its removal or resignation. Any Trustee may resign from office (without need for prior or subsequent accounting) by an instrument in writing signed by the Trustee and delivered to the Sponsor and the Trust, which resignation shall take effect upon such delivery or upon such later date as is specified therein; provided, however, that: (i) No such resignation of the Trustee that acts as the Property Trustee shall be effective: a. until a Successor Property Trustee has been appointed and has accepted such appointment by instrument executed by such Successor Property Trustee and delivered to the Trust, the Sponsor and the resigning Property Trustee; or 31 b. until the assets of the Trust have been completely liquidated and the proceeds thereof distributed to the holders of the Securities; and (ii) no such resignation of the Trustee that acts as the Delaware Trustee shall be effective until a Successor Delaware Trustee has been appointed and has accepted such appointment by instrument executed by such Successor Delaware Trustee and delivered to the Trust, the Sponsor and the resigning Delaware Trustee. (d) The Holders of the Common Securities shall use their best efforts to promptly appoint a Successor Delaware Trustee or Successor Property Trustee, as the case may be, if the Property Trustee or the Delaware Trustee delivers an instrument of resignation in accordance with this Section 6.6. (e) If no Successor Property Trustee or Successor Delaware Trustee, as the case may be, shall have been appointed and accepted appointment as provided in this Section 6.6 within 60 days after delivery to the Sponsor and the Trust of an instrument of resignation or removal, the resigning or removed Property Trustee or Delaware Trustee, as applicable, may petition any court of competent jurisdiction for appointment of a Successor Property Trustee or Successor Delaware Trustee, as applicable. Such court may thereupon, after prescribing such notice, if any, as it may deem proper, appoint a Successor Property Trustee or Successor Delaware Trustee, as the case may be. (f) No Property Trustee or Delaware Trustee shall be liable for the acts or omissions to act of any Successor Property Trustee or Successor Delaware Trustee, as the case may be. SECTION 6.7 Vacancies among Trustees. If a Trustee ceases to hold office for any reason and the number of Trustees is not reduced pursuant to Section 6.1, or if the number of Trustees is increased pursuant to Section 6.1, a vacancy shall occur. A resolution certifying the existence of such vacancy by the Administrative Trustees or, if there are more than two, a majority of the Administrative Trustees shall be conclusive evidence of the existence of such vacancy. The vacancy shall be filled with a Trustee appointed in accordance with Section 6.6. SECTION 6.8 Effect of Vacancies. The death, resignation, retirement, removal, bankruptcy, dissolution, liquidation, incompetence or incapacity to perform the duties of a Trustee shall not operate to annul, dissolve or terminate the Trust. Whenever a vacancy in the number of Administrative Trustees shall occur, until such vacancy is filled by the appointment of an Administrative Trustee in accordance with Section 6.6, the Administrative Trustees in office, regardless of their number, shall have all the powers granted to the Administrative Trustees and shall discharge all the duties imposed upon the Administrative Trustees by this Trust Agreement. SECTION 6.9 Meetings. 32 If there is more than one Administrative Trustee, meetings of the Administrative Trustees shall be held from time to time upon the call of any Administrative Trustee. Regular meetings of the Administrative Trustees may be held at a time and place fixed by resolution of the Administrative Trustees. Notice of any in-person meetings of the Administrative Trustees shall be hand delivered or otherwise delivered in writing (including by facsimile, with a hard copy by overnight courier) not less than 48 hours before such meeting. Notice of any telephonic meetings of the Administrative Trustees shall be hand delivered or otherwise delivered in writing (including by facsimile, with a hard copy by overnight courier) not less than 24 hours before a meeting. Notices shall contain a brief statement of the time, place and anticipated purposes of the meeting. The presence (whether in person or by telephone) of an Administrative Trustee at a meeting shall constitute a waiver of notice of such meeting except where an Administrative Trustee attends a meeting for the express purpose of objecting to the transaction of any activity on the ground that the meeting has not been lawfully called or convened. Unless provided otherwise in this Trust Agreement, any action of the Administrative Trustees may be taken at a meeting by vote of a majority of the Administrative Trustees present (whether in person or by telephone) and eligible to vote with respect to such matter, provided that a Quorum is present, or without a meeting by the unanimous written consent of the Administrative Trustees. In the event there is only one Administrative Trustee, any and all action of such Administrative Trustee shall be evidenced by a written consent of such Administrative Trustee. SECTION 6.10 Delegation of Power. (a) Any Administrative Trustee may, by power of attorney consistent with applicable law, delegate to any natural person over the age of 21 his, her or its power for the purpose of executing any documents contemplated in Section 3.6, including any registration statement or amendment thereto filed with the Commission, or making any other governmental filing. (b) The Administrative Trustees shall have power to delegate from time to time to such of their number or to officers of the Trust the doing of such things and the execution of such instruments either in the name of the Trust or the names of the Administrative Trustees or otherwise as the Administrative Trustees may deem expedient, to the extent such delegation is not prohibited by applicable law or contrary to the provisions of the Trust, as set forth herein. SECTION 6.11 Merger, Conversion, Consolidation or Succession to Business. Any corporation into which the Property Trustee, the Delaware Trustee or any Administrative Trustee that is not a natural person may be merged or converted or with such Trustee may be consolidated, or any corporation resulting from any merger, conversion or consolidation to which such Trustee shall be a party, or any corporation succeeding to all or substantially all the corporate trust business of such Trustee shall be the successor of such Trustee hereunder, provided such corporation shall be otherwise qualified and eligible under this Article, without the execution or filing of any paper or any further act on the part of any of the parties hereto. ARTICLE 7 33 TERMS OF SECURITIES SECTION 7.1 General Provisions Regarding Securities. (a) The Administrative Trustees shall on behalf of the Trust issue one class of trust preferred securities representing undivided beneficial ownership interests in the assets of the Trust and one class of common securities representing undivided beneficial ownership interests in the assets of the Trust. (i) Trust Preferred Securities. The Trust Preferred Securities shall have an aggregate liquidation amount with respect to the assets of the Trust of __________________________________ dollars ($__________________________) with respect to the initial closing of the sale of Trust Preferred Securities [and, if the Option set forth in Section 7.13(a) is exercised, an additional aggregate liquidation amount with respect to the assets of the Trust of __________ dollars ($__________) with respect to the second closing of the sale of Trust Preferred Securities; PROVIDED that the maximum aggregate liquidation amount of Trust Preferred Securities shall not exceed ____________ dollars ($_________).] The Trust Preferred Securities are hereby designated for identification purposes only as "_____% Trust Preferred Securities" (the "Trust Preferred Securities"). The Trust Preferred Security Certificates evidencing the Trust Preferred Securities shall be substantially in the form of Exhibit A to this Trust Agreement, with such changes and additions thereto or deletions therefrom as may be required by ordinary usage, custom or practice or to conform to the rules of any stock exchange on which the Trust Preferred Securities are listed or quoted subject to [Section 7.13(b).] (ii) Common Securities. The Common Securities of the Trust shall have an aggregate liquidation amount with respect to the assets of the Trust of ____________________________ dollars ($_______________) with respect to the initial closing of the sale of Common Securities [and, if the Option set forth in Section 7.13(a) is exercised, an additional aggregate liquidation amount with respect to the assets of the Trust of __________ dollars ($__________)] with respect to the second closing of the sale of Common Securities; PROVIDED that the maximum aggregate liquidation amount of common securities issued by the Trust shall not exceed __________ dollars ($___________). The Common Securities are hereby designated for identification purposes only as "____% Common Securities" (the "Common Securities" and, together with the Trust Preferred Securities, the "Securities"). The Common Security Certificates evidencing the Common Securities shall be substantially in the form of Exhibit B to this Trust Agreement, with such changes and additions thereto or deletions therefrom as may be required by ordinary usage, custom or practice subject to [section 7.13(b).] (b) Payment of Distributions on, and payment of the Redemption Price upon a redemption of, the Trust Preferred Securities and the Common Securities, as applicable, shall be made Pro Rata based on the liquidation amount of such Trust Preferred Securities and Common Securities; provided, however, that if on any date on which amounts payable on distribution or redemption, an Indenture Event of Default shall have occurred and be continuing, no payment of any Distribution on, or Redemption Price of, any of the Common Securities, and no other payment on account of the redemption, liquidation or other acquisition of such Common 34 Securities, shall be made unless payment in full in cash of all accumulated and unpaid Distributions on all of the outstanding Trust Preferred Securities for all Distribution periods terminating on or prior thereto, or, in the case of amounts payable on redemption, the full amount of the Redemption Price for all of the outstanding Trust Preferred Securities then called for redemption, shall have been made or provided for, and all funds available to the Property Trustee shall first be applied to the payment in full in cash of all Distributions on, or the Redemption Price of, the Trust Preferred Securities then due and payable. The Trust shall issue no securities or other interests in the assets of the Trust other than the Trust Preferred Securities and the Common Securities. (c) The Certificates shall be signed on behalf of the Trust by an Administrative Trustee. Such signature shall be the manual or facsimile signature of any present or any future Administrative Trustee. In case an Administrative Trustee of the Trust who shall have signed any of the Certificates shall cease to be such an Administrative Trustee before the Certificates so signed shall be delivered by the Trust, such Certificates nevertheless may be delivered as though the person who signed such Certificates had not ceased to be such an Administrative Trustee; and any Certificate may be signed on behalf of the Trust by such persons who, at the actual date of execution of such Certificate, shall be the Administrative Trustees of the Trust, although at the date of the execution and delivery of the Trust Agreement any such person was not such an Administrative Trustee. Certificates shall be printed, lithographed or engraved or may be produced in any other manner as is reasonably acceptable to the Administrative Trustees, as evidenced by their execution thereof, and may have such letters, numbers or other marks of identification or designation and such legends or endorsements as the Administrative Trustees may deem appropriate, or as may be required to comply with any law or with any rule or regulation of any stock exchange on which Securities may be listed, or to conform to usage. A Certificate representing Trust Preferred Securities shall not be valid until authenticated by the manual signature of an authorized officer of the Property Trustee. Such signature shall be conclusive evidence that such Certificate has been authenticated under this Trust Agreement. The Trust Preferred Security Certificates shall be dated their date of authentication. Upon a written order of the Trust signed by one Administrative Trustee, the Property Trustee shall authenticate the Certificates representing Trust Preferred Securities for original issue. The aggregate number of Trust Preferred Securities outstanding at any time shall not exceed the liquidation amount set forth in Section 7.1(a)(i). The Property Trustee may appoint an authenticating agent acceptable to the Trust to authenticate Certificates. An authenticating agent may authenticate Certificates whenever the Property Trustee may do so. Each reference in this Trust Agreement to authentication by the Property Trustee includes authentication by such agent. An authenticating agent has the same rights as the Property Trustee to deal with the Sponsor or an Affiliate of the Sponsor. (d) The consideration received by the Trust for the issuance of the Securities shall constitute a contribution to the capital of the Trust and shall not constitute a loan to the Trust. 35 (e) Except to the extent set forth in Section 9.1(b), upon issuance of the Securities as provided in this Trust Agreement, the Securities so issued shall be deemed to be validly issued, fully paid and non-assessable undivided beneficial ownership interests in the assets of the Trust. (f) Every Person, by virtue of having become a Holder or a Trust Preferred Security Beneficial Owner in accordance with the terms of this Trust Agreement, shall be deemed to have expressly assented and agreed to the terms of, and shall be bound by, this Trust Agreement and the terms of the Securities, the Guarantee, the Indenture and the Junior Subordinated Notes. (g) The holders of the Securities shall have no preemptive or similar rights. SECTION 7.2 Distributions. (a) Holders of Securities shall be entitled to receive cumulative cash Distributions at the rate per annum of __% of the stated liquidation amount of $__ per Security. The amount of Distributions payable for any period shall be computed on the basis of a 360-day year of twelve 30-day months. The amount of distributions payable for any period shorter than a full quarterly distribution period shall be computed on the basis of a 30-day month and for periods of less than a month, the actual number of days elapsed per 30-day month. Subject to Section 7.1(b), Distributions shall be made on the Trust Preferred Securities and the Common Securities on a Pro Rata basis. Distributions on the Securities shall, from the date of original issue, accrue and be cumulative and shall be payable [quarterly][semi-annually], in arrears, on each __________ [, __________, _________] and _________, commencing _________ __, ____, when, as and if available for payment, by the Property Trustee, except as otherwise described below. Distributions are payable only to the extent that payments are made in respect of the Junior Subordinated Notes held by the Property Trustee and to the extent that the Trust has funds available for the payment of such Distributions in the Property Account. (b) Distributions not paid on the scheduled payment date will accumulate and compound [quarterly][semi-annually] at the rate of __% per annum ("Compounded Distributions"). "Distributions" shall mean ordinary cumulative distributions together with any Compounded Distributions. (c) If and to the extent that the Junior Subordinated Note Issuer makes a payment of interest, premium and/or principal on the Junior Subordinated Notes held by the Property Trustee (the amount of any such payment being a "Payment Amount"), the Property Trustee shall and is directed, to the extent funds are available for that purpose, to make a Pro Rata distribution of the Payment Amount to Holders, subject to Section 7.1(b). (d) Distributions on the Securities shall be payable to the Holders thereof as they appear on the register of the Trust as of the close of business on the relevant record dates. While the Trust Preferred Securities are represented by one or more Global Securities, the relevant record dates shall be the close of business on the Business Day next preceding such Distribution payment date, unless a different regular record date is established or provided for the corresponding interest payment date on the Junior Subordinated Notes. The relevant record dates for the Common Securities shall be the same as for the Trust Preferred Securities. If the Trust 36 Preferred Securities shall not continue to remain represented by one or more Global Securities, the relevant record dates for the Trust Preferred Securities will conform to rules of any securities exchange on which the Trust Preferred Securities are listed and if none, shall be selected by the Administrative Trustees and shall be more than [14 days but less than 60] days prior to the relevant payment dates. At all times, the Distribution payment dates shall correspond to the interest payment dates on the Junior Subordinated Notes. Distributions payable on any Securities that are not punctually paid on any Distribution payment date, as a result of the Junior Subordinated Note Issuer having failed to make a payment under the Junior Subordinated Notes, shall cease to be payable to the Person in whose name such Securities are registered on the relevant record date, and such defaulted Distribution will instead be payable to the Person in whose name such Securities are registered on the special record date or other specified date determined with respect to the related interest payment date pursuant to the Indenture. If any date on which Distributions are payable on the Securities is not a Business Day, then payment of the Distribution payable on such date will be made on the next succeeding day that is a Business Day (and without any interest or other 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 next preceding day which is a Business Day, with the same force and effect as if made on such payment date. (e) In the event that there is any money or other property held by or for the Trust that is not accounted for hereunder, such property shall be distributed Pro Rata among the Holders of the Securities. SECTION 7.3 Redemption of Securities. (a) Upon the repayment or redemption, in whole or in part, of the Junior Subordinated Notes held by the Trust, whether at the stated maturity of the Junior Subordinated Notes or upon earlier redemption as provided in the Indenture, the proceeds from such repayment or redemption shall be simultaneously applied Pro Rata (subject to Section 7.1(b)) to redeem Securities having an aggregate liquidation amount equal to the aggregate principal amount of the Junior Subordinated Notes so repaid or redeemed at the Redemption Price. Holders shall be given not less than 30 nor more than 60 days notice of such redemption in accordance with Section 7.4. (b) On the date fixed for any distribution of Junior Subordinated Notes, upon dissolution of the Trust, (i) the Securities will no longer be deemed to be outstanding and (ii) certificates representing Securities will be deemed to represent the Junior Subordinated Notes having an aggregate principal amount equal to the stated liquidation amount of, and bearing accrued and unpaid interest equal to accrued and unpaid distributions on, such Securities until such certificates are presented to the Sponsor or its agent for transfer or reissuance. (c) Certificates called for redemption in whole must be surrendered to the Paying Agent in order to receive payment of the Redemption Price. SECTION 7.4 Redemption Procedures. 37 (a) Notice of any redemption of, or notice of distribution of Junior Subordinated Notes in exchange for, the Securities (a "Redemption/Distribution Notice"), which notice shall be irrevocable, will be given by the Trust by mail to each Holder of Securities to be redeemed or exchanged not fewer than 30 nor more than 60 days before the date fixed for redemption or exchange thereof which, in the case of a redemption, will be the date fixed for redemption of or the date of final maturity of the Junior Subordinated Notes. For purposes of the calculation of the date of redemption or exchange and the dates on which notices are given pursuant to this Section 7.4(a), a Redemption/Distribution Notice shall be deemed to be given on the day such notice is first mailed by first-class mail, postage prepaid, to Holders of Securities. Each Redemption/Distribution Notice shall be addressed to the Holders of Securities at the address of each such Holder appearing in the register of the Trust. No defect in the Redemption/Distribution Notice or in the mailing of either thereof with respect to any Holder shall affect the validity of the redemption or exchange proceedings with respect to any other Holder. (b) If fewer than all the outstanding Securities are to be so redeemed, the Common Securities and the Trust Preferred Securities will be redeemed Pro Rata (subject to Section 7.1(b)) and the Trust Preferred Securities to be redeemed will be redeemed as described in Section 7.4(c) below. The Trust may not redeem the Securities in part unless all accumulated and unpaid Distributions to the date of redemption have been paid in full on all Securities then outstanding. For all purposes of this Trust Agreement, unless the context otherwise requires, all provisions relating to the redemption of Trust Preferred Securities shall relate, in the case of any Trust Preferred Security redeemed or to be redeemed only in part, to the portion of the aggregate liquidation amount of Trust Preferred Securities which has been or is to be redeemed. (c) Subject to the Trust's fulfillment of the notice requirements set forth in Section 7.4(a) above, if Securities are to be redeemed, then (i) with respect to Trust Preferred Securities represented by one or more Global Securities, by 12:00 noon, New York City time, on the redemption date (provided that the Junior Subordinated Note Issuer has paid the Property Trustee a sufficient amount of immediately available funds in connection with the related redemption or maturity of the Junior Subordinated Notes), the Property Trustee will deposit irrevocably with the Depositary or its nominee (or successor Clearing Agency or its nominee) funds sufficient to pay the applicable Redemption Price with respect to the Trust Preferred Securities and will give the Depositary irrevocable instructions and authority to pay the Redemption Price to the Holders of the Trust Preferred Securities and (ii) with respect to Securities not represented by one or more Global Securities (provided that the Junior Subordinated Note Issuer has paid the Property Trustee a sufficient amount of immediately available funds in connection with the related redemption or maturity of the Junior Subordinated Notes), the Paying Agent will pay the relevant Redemption Price to the Holders of such Securities by check mailed to the address of the relevant Holder appearing on the register of the Trust on the redemption date. If any date fixed for redemption of Securities is not a Business Day, then payment of the Redemption Price payable on such date will be made on the next succeeding day that is a Business Day (and without any interest or other 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 next preceding day which is a Business Day. If payment of the Redemption Price in respect of any Securities is improperly withheld or refused and not paid either by the Property Trustee or by the Sponsor as guarantor pursuant to the Guarantee, Distributions on such Securities will continue to accrue at 38 the then applicable rate from the original redemption date to the actual date of payment, in which case the actual payment date will be considered the date fixed for redemption for purposes of calculating the Redemption Price. For these purposes, the applicable Redemption Price shall not include Distributions which are being paid to Holders who were Holders on a relevant record date. If a Redemption/Distribution Notice shall have been given and funds deposited or paid as required, then immediately prior to the close of business on the date of such deposit or payment, Distributions will cease to accrue on the Securities called for redemption and all rights of Holders of such Securities so called for redemption will cease, except the right of the Holders to receive the Redemption Price, but without interest on such Redemption Price, and from and after the date fixed for redemption, such Securities will cease to be outstanding. Neither the Administrative Trustees nor the Trust shall be required to register or cause to be registered the transfer of any Securities that have been called for redemption, except in the case of any Securities being redeemed in part, any portion thereof not to be redeemed. (d) Subject to the foregoing and applicable law (including, without limitation, United States federal securities laws), the Junior Subordinated Note Issuer or its subsidiaries may at any time and from time to time purchase outstanding Trust Preferred Securities by tender, in the open market or by private agreement. SECTION 7.5 Voting Rights of Trust Preferred Securities. (a) Except as provided under Section 11.1 and this Article 7 and as otherwise required by the Business Trust Act, the Trust Indenture Act and other applicable law, the Holders of the Trust Preferred Securities shall have no voting rights. (b) Subject to the requirement of the Property Trustee obtaining a tax opinion in certain circumstances set forth in Section 7.5(d) below, the Holders of a Majority in Liquidation Amount of the Trust Preferred Securities voting separately as a class have the right to direct the time, method and place of conducting any proceeding for any remedy available to the Property Trustee, or to direct the exercise of any trust or power conferred upon the Property Trustee under the Trust Agreement, including the right to direct the Property Trustee, as Holder of the Junior Subordinated Notes, to (i) exercise the remedies available to it under the Indenture as a Holder of the Junior Subordinated Notes; (ii) consent to any amendment or modification of the Indenture or the Junior Subordinated Notes where such consent shall be required or (iii) waive any past default and its consequences that is waivable under Section 513 of the Indenture; provided, however, that if an Indenture Event of Default has occurred and is continuing, then the Holders of 25% of the aggregate liquidation amount of the Trust Preferred Securities may direct the Property Trustee to declare the principal of and interest on the Junior Subordinated Notes due and payable; provided, further, that where a consent or action under the Indenture would require the consent or act of the Holders of more than a majority of the aggregate principal amount of Junior Subordinated Notes affected thereby, only the Holders of the percentage of the aggregate stated liquidation amount of the Trust Preferred Securities which is at least equal to the percentage required under the Indenture may direct the Property Trustee to give such consent to take such action provided, further, that (subject to the provisions of Section 3.9) the Property Trustee shall have the right to decline to follow any such direction if the Property Trustee shall 39 determine that the action so directed would be unjustly prejudicial to the Holders of Trust Preferred Securities not taking part in such direction or if the Property Trustee, being advised by counsel, determines that the action or proceeding so directed may not lawfully be taken or if the Property Trustee, in good faith, by its board of directors or trustees, executive committee, or a trust committee of directors or trustees, and/or Responsible Officers, shall determine that the action or proceeding so directed would involve the Property Trustee in personal liability. (c) If the Property Trustee fails to enforce its rights under the Junior Subordinated Notes after a Holder of Trust Preferred Securities has made a written request, such Holder of Trust Preferred Securities may, to the extent permitted by applicable law, institute a legal proceeding directly against the Junior Subordinated Note Issuer to enforce the Property Trustee's rights under the Indenture without first instituting any legal proceeding against the Property Trustee or any other Person. In addition, if a Trust Enforcement Event has occurred and is continuing and such event is attributable to the failure of the Junior Subordinated Note Issuer to make any interest, principal or other required payments when due under the Indenture, then a Holder of Trust Preferred Securities may directly institute a Direct Action against the Junior Subordinated Note Issuer on or after the respective due date specified in the Junior Subordinated Notes. (d) Subject to section 2.7 the Property Trustee shall notify all Holders of the Trust Preferred Securities of any notice of any Indenture Event of Default received from the Junior Subordinated Note Issuer with respect to the Junior Subordinated Notes. Such notice shall state that such Indenture Event of Default also constitutes a Trust Enforcement Event. Except with respect to directing the time, method, and place of conducting a proceeding for a remedy, the Property Trustee shall be under no obligation to take any of the actions described in clause 7.5(b)(i) and (ii) above unless the Property Trustee has obtained an opinion of independent tax counsel to the effect that the Trust will not fail to be classified as a grantor trust for United States federal income tax purposes as a result of such action. (e) In the event the consent of the Property Trustee, as the Holder of the Junior Subordinated Notes, is required under the Indenture with respect to any amendment or modification of the Indenture, the Property Trustee shall request the direction of the Holders of the Securities with respect to such amendment or modification and shall vote with respect to such amendment or modification as directed by not less than a majority in liquidation amount of the Securities voting together as a single class; provided, however, that where a consent under the Indenture would require the consent of the Holders of more than a majority of the aggregate principal amount of the Junior Subordinated Notes, the Property Trustee may only give such consent at the direction of the Holders of at least the same proportion in aggregate stated liquidation amount of the Securities. The Property Trustee shall not take any such action in accordance with the directions of the Holders of the Securities unless the Property Trustee has obtained an opinion of independent tax counsel to the effect that the Trust will not be classified as other than a grantor trust for United States federal income tax purposes as a result of such action. (f) A waiver of an Indenture Event of Default with respect to the Junior Subordinated Notes will constitute a waiver of the corresponding Trust Enforcement Event. 40 (g) Any required approval or direction of Holders of Trust Preferred Securities may be given at a separate meeting of Holders of Trust Preferred Securities convened for such purpose, at a meeting of all of the Holders of Securities or pursuant to written consent. The Administrative Trustees will cause a notice of any meeting at which Holders of Trust Preferred Securities are entitled to vote to be mailed to each Holder of record of Trust Preferred Securities. Each such notice will include a statement setting forth (i) the date of such meeting, (ii) a description of any resolution proposed for adoption at such meeting on which such Holders are entitled to vote and (iii) instructions for the delivery of proxies. (h) No vote or consent of the Holders of Trust Preferred Securities shall be required for the Trust to redeem and cancel Trust Preferred Securities or distribute Junior Subordinated Notes in accordance with this Trust Agreement and the terms of the Securities. (i) Notwithstanding that Holders of Trust Preferred Securities are entitled to vote or consent under any of the circumstances described above, any of the Securities that are owned at such time by the Junior Subordinated Note Issuer, any Administrative Trustee or any entity directly or indirectly controlled by, or under direct or indirect common control with, the Junior Subordinated Note Issuer or any Administrative Trustee, shall not be entitled to vote or consent and shall, for purposes of such vote or consent, be treated as if such Securities were not outstanding; PROVIDED, HOWEVER, that persons otherwise eligible to vote to whom the Junior Subordinated Note Issuer or any of its subsidiaries have pledged Trust Preferred Securities may vote or consent with respect to such pledged Trust Preferred Securities under any of the circumstances described herein. (j) Subject to Sections 6.6(a) and 7.5(k), Holders of the Trust Preferred Securities shall have no rights to appoint or remove the Trustees, who may be appointed, removed or replaced solely by the Common Securities Holder. (k) Subject to the rights of the Holders of a Majority in Liquidated Amount of the Common Securities to appoint or remove Administrative Trustees as provided in Section 6.6(a)(iii), an Indenture Event of Default has occurred and is continuing, the Trustees may be removed at such time only by a Majority in Liquidation Amount of the Trust Preferred Securities. SECTION 7.6 Voting Rights of Common Securities. (a) Except as provided under Section 6.1(b), this Section 7.6 or Section 11.1 or as otherwise required by the Business Trust Act, the Trust Indenture Act or other applicable law or provided by the Trust Agreement, the Holders of the Common Securities will have no voting rights. (b) Subject to Sections 6.6(a) and 7.5(k), the Holders of the Common Securities shall be entitled, in accordance with Article 6 of this Trust Agreement, to vote to appoint, remove or replace any Trustee or to increase or decrease the number of Trustees. 41 (c) Subject to Section 2.6 and only after all Trust Enforcement Events with respect to the Trust Preferred Securities have been cured, waived, or otherwise eliminated and subject to the requirement of the Property Trustee obtaining a tax opinion in certain circumstances set forth in this paragraph (c), the Holders of a Majority in Liquidation Amount of the Common Securities have the right to direct the time, method and place of conducting any proceeding for any remedy available to the Property Trustee, or direct the exercise of any trust or power conferred upon the Property Trustee under this Trust Agreement, including the right to direct the Property Trustee, as Holder of the Junior Subordinated Notes, to (i) exercise the remedies available to it under the Indenture as a Holder of the Junior Subordinated Notes, (ii) consent to any amendment or modification of the Indenture or the Junior Subordinated Notes where such consent shall be required or (iii) waive any past default and its consequences that is waivable under Section 513 of the Indenture; provided, however, that where a consent or action under the Indenture would require the consent or act of the Holders of more than a majority of the aggregate principal amount of Junior Subordinated Notes affected thereby, only the Holders of the percentage of the aggregate stated liquidation amount of the Common Securities which is at least equal to the percentage required under the Indenture may direct the Property Trustee to have such consent or take such action, provided, further, that (subject to the provisions of Section 3.9) the Property Trustee shall have the right to decline to follow any such direction if the Property Trustee shall determine that the action so directed would be unjustly prejudicial to the Holders of Common Securities not taking part in such direction or if the Property Trustee, being advised by counsel, determines that the action or proceeding so directed may not lawfully be taken or if the Property Trustee, in good faith, by its board of directors or trustees, executive committee, or a trust committee of directors or trustees, and/or Responsible officers, shall determine that the action or proceeding so directed would involve the Property Trustee in personal liability. Except with respect to directing the time, method, and place of conducting a proceeding for a remedy, the Property Trustee shall be under no obligation to take any of the actions described in clause 7.6(c)(i) and (ii) above unless the Property Trustee has obtained an opinion of independent tax counsel to the effect that, as a result of such action, for United States federal income tax purposes the Trust will not fail to be classified as a grantor trust and [each Holder will be treated as owning an undivided beneficial ownership interest in the Junior Subordinated Notes.] (d) If the Property Trustee fails to enforce its rights under the Junior Subordinated Notes after a Holder of Common Securities has made a written request, such Holder of Common Securities may, to the extent permitted by applicable law, directly institute a legal proceeding directly against the Junior Subordinated Note Issuer to enforce the Property Trustee's rights under the Junior Subordinated Notes without first instituting any legal proceeding against the Property Trustee or any other Person. (e) A waiver of an Indenture Event of Default with respect to the Junior Subordinated Notes will constitute a waiver of the corresponding Trust Enforcement Event. (f) Any required approval or direction of Holders of Common Securities may be given at a separate meeting of Holders of Common Securities convened for such purpose, at a meeting of all of the Holders of Securities or pursuant to written consent. The Administrative Trustees will cause a notice of any meeting at which Holders of Common Securities are entitled to vote to be mailed to each Holder of record of Common Securities. Each such notice will include a 42 statement setting forth (i) the date of such meeting, (ii) a description of any resolution proposed for adoption at such meeting on which such Holders are entitled to vote and (iii) instructions for the delivery of proxies. (g) No vote or consent of the Holders of the Common Securities will be required for the Trust to redeem and cancel Common Securities or to distribute Junior Subordinated Notes in accordance with the Trust Agreement and the terms of the Securities. SECTION 7.7 Paying Agent. The Trust shall maintain in the Borough of Manhattan, City of New York, State of New York, an office or agency where the Trust Preferred Securities may be presented for payment ("Paying Agent"). The Trust may appoint the paying agent and may appoint one or more additional paying agents in such other locations as it shall determine. The term "Paying Agent" includes any additional paying agent. The Trust may change any Paying Agent without prior notice to the Holders. The Trust shall notify the Property Trustee of the name and address of any Paying Agent not a party to this Trust Agreement. If the Trust fails to appoint or maintain another entity as Paying Agent, the Property Trustee shall act as such. The Trust or any of its Affiliates may act as Paying Agent. The Property Trustee shall initially act as Paying Agent for the Securities. In the event the Property Trustee shall no longer be the Paying Agent, the Administrative Trustees shall appoint a successor (which shall be a bank or trust company acceptable to the Junior Subordinated Note Issuer) to act as Paying Agent. The Paying Agent shall be permitted to resign as Paying Agent upon 30 days' written notice to the Property Trustee and the Junior Subordinated Note Issuer. [SECTION 7.8 Listing [The Sponsor shall use its best efforts to cause the Trust Preferred Securities to be listed for quotation on the New York Stock Exchange.] SECTION 7.9 Transfer of Securities. (a) Securities may only be transferred, in whole or in part, in accordance with the terms and conditions set forth in this Trust Agreement and in the terms of the Securities. To the fullest extent permitted by law, any transfer or purported transfer of any Security not made in accordance with this Trust Agreement shall be null and void. (b) (i) Subject to this Article 7, Trust Preferred Securities shall be freely transferable. (ii) The Holder of the Common Securities may not transfer the Common Securities except (A) in compliance with a consolidation, merger, sale, conveyance or lease of the Sponsor in compliance with Article Eight of the Indenture or (B) to the Sponsor or an Affiliate thereof in compliance with applicable law, including the Securities Act and applicable state securities and blue sky laws. To the fullest extent permitted by law, any attempted transfer of the Common Securities other than as set forth in the immediately preceding sentence shall be null and void. 43 (c) The Trust shall cause to be kept at the Corporate Trust Office of the Property Trustee a register (the register maintained in such office being herein sometimes referred to as the "Security Register") in which, subject to such reasonable regulations as it may prescribe, the Trust shall provide for the registration of Trust Preferred Securities and of transfers of Trust Preferred Securities. The Property Trustee is hereby appointed "Security Registrar" for the purpose of registering Trust Preferred Securities and transfers of Trust Preferred Securities as herein provided. (d) Upon surrender for registration of transfer of any Security at an office or agency of the Trust designated for such purpose, the Trust shall execute, and in the case of Trust Preferred Securities the Property Trustee shall authenticate and deliver, in the name of the designated transferee or transferees, one or more new Securities of any authorized denominations and of a like aggregate principal amount. (e) At the option of the Holder, Securities may be exchanged for other Securities of any authorized denominations and of a like aggregate principal amount, upon surrender of the Securities to be exchanged at such office or agency. Whenever any Securities are so surrendered for exchange, the Trust shall execute, and in the case of Trust Preferred Securities the Property Trustee shall authenticate and deliver, the Securities which the Holder making the exchange is entitled to receive. (f) Every Security presented or surrendered for registration of transfer or for exchange shall (if so required by the Trust or the Property Trustee) be duly endorsed, or be accompanied by a written instrument of transfer in form satisfactory to the Trust and the Security Registrar duly executed, by the Holder thereof or his attorney duly authorized in writing. (g) No service charge shall be made for any registration of transfer or exchange of Securities, but the Trust may require payment of a sum sufficient to cover any tax or other governmental charge that may be imposed in connection with any registration of transfer or exchange of Securities. (h) If the Securities are to be redeemed in part, the Trust shall not be required (A) to issue, register the transfer of or exchange any Securities during a period beginning at the opening of business 15 days before the day of the mailing of a notice of redemption of any such Securities selected for redemption under Section 7.4 and ending at the close of business on the day of such mailing, or (B) to register the transfer or exchange of any Security so selected for redemption in whole or in part, except the unredeemed portion of any Security being redeemed in part. SECTION 7.10 Mutilated, Destroyed, Lost or Stolen Certificates. If: (a) any mutilated Certificates should be surrendered to the Administrative Trustees or the Property Trustee, or if the Administrative Trustees and the Property Trustee shall receive evidence to their satisfaction of the destruction, loss or theft of any Certificate; and 44 (b) there shall be delivered to the Administrative Trustees and the Property Trustee such security or indemnity as may be required by them to keep each of the Trustees, the Sponsor and the Trust harmless, then, in the absence of notice that such Certificate shall have been acquired by a bona fide purchaser, any Administrative Trustee on behalf of the Trust shall execute and deliver and, with respect to Trust Preferred Securities Certificates, the Property Trustee shall authenticate, in exchange for or in lieu of any such mutilated, destroyed, lost or stolen Certificate, a new Certificate of like denomination. In connection with the issuance of any new Certificate under this Section 7.10, the Administrative Trustees may require the payment of a sum sufficient to cover any tax or other governmental charge that may be imposed in connection therewith. Any duplicate Certificate issued pursuant to this Section shall constitute conclusive evidence of an ownership interest in the relevant Securities, as if originally issued, whether or not the lost, stolen or destroyed Certificate shall be found at any time. The provisions of this Section are exclusive and shall preclude (to the extent lawful) all other rights and remedies with respect to the replacement of mutilated, destroyed, lost or stolen Certificates. SECTION 7.11 Deemed Security Holders. The Trustees may treat the Person in whose name any Certificate shall be registered on the register of the Trust as the sole holder of such Certificate and of the Securities represented by such Certificate for purposes of receiving Distributions (subject to Section 7.2(d)) and for all other purposes whatsoever and, accordingly, shall not be bound to recognize any equitable or other claim to or interest in such Certificate or in the Securities represented by such Certificate on the part of any Person, whether or not the Trust shall have actual or other notice thereof. SECTION 7.12 Global Securities. The Trust Preferred Securities may be issued in the form of one or more Global Securities. If the Trust Preferred Securities are to be issued in the form of one or more Global Securities, then an Administrative Trustee on behalf of the Trust shall execute and the Property Trustee shall authenticate and deliver one or more Global Securities that (i) shall represent and shall be denominated in an amount equal to the aggregate liquidation amount of all of the Trust Preferred Securities to be issued in the form of Global Securities and not yet cancelled, (ii) shall be registered in the name of the Depositary for such Global Security or the nominee of such Depositary, and (iii) shall be delivered by the Property Trustee to such Depositary or pursuant to such Depositary's instructions. Global Securities shall bear a legend substantially to the following effect: "This Trust Preferred Security is a Global Security within the meaning of the Trust Agreement hereinafter referred to and is registered in the name of The Depository Trust Company, a New York corporation (the "Depositary"), or a nominee of the Depositary. This Trust Preferred Security is exchangeable for Trust Preferred Securities registered in the name of a person other than the Depositary or its nominee only in the limited circumstances described in the Trust Agreement and no transfer of this Trust Preferred Security (other than a transfer of this Trust Preferred Security as a whole by the Depositary to a nominee of the Depositary or by a 45 nominee of the Depositary to the Depositary or another nominee of the Depositary) may be registered except in limited circumstances. Unless this Trust Preferred Security Certificate is presented by an authorized representative of the Depositary to Virginia Power Capital Trust II or its agent for registration of transfer, exchange or payment, and any Trust Preferred Security Certificate issued is registered in the name of Cede & Co. or such other name as requested by an authorized representative of the Depositary (and any payment hereon is made to Cede & Co. or to such other entity as is requested by an authorized representative of the Depositary), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL inasmuch as the registered owner hereof, Cede & Co., has an interest herein." Trust Preferred Securities not represented by a Global Security issued in exchange for all or a part of a Global Security pursuant to this Section 7.12 shall be registered in such names and in such authorized denominations as the Depositary, pursuant to instructions from its direct or indirect participants or otherwise, shall instruct the Property Trustee. Upon execution and authentication, the Property Trustee shall deliver such Trust Preferred Securities not represented by a Global Security to the Persons in whose names such definitive Trust Preferred Securities are so registered. At such time as all interests in Global Securities have been redeemed, repurchased or cancelled, such Global Securities shall be, upon receipt thereof, cancelled by the Property Trustee in accordance with standing procedures of the Depositary. At any time prior to such cancellation, if any interest in Global Securities is exchanged for Trust Preferred Securities not represented by a Global Security, redeemed, cancelled or transferred to a transferee who receives Trust Preferred Securities not represented by a Global Security therefor or any Trust Preferred Security not represented by a Global Security is exchanged or transferred for part of Global Securities, the principal amount of such Global Securities shall, in accordance with the standing procedures of the Depositary, be reduced or increased, as the case may be, and an endorsement shall be made on such Global Securities by the Property Trustee to reflect such reduction or increase. The Trust and the Property Trustee may for all purposes, including the making of payments due on the Trust Preferred Securities, deal with the Depositary as the authorized representative of the Holders for the purposes of exercising the rights of Holders hereunder. The rights of the owner of any beneficial interest in a Global Security shall be limited to those established by law and agreements between such owners and depository participants provided, that no such agreement shall give any rights to any Person against the Trust or the Property Trustee without the written consent of the parties so affected. Multiple requests and directions from and votes of the Depositary as holder of Trust Preferred Securities in global form with respect to any particular matter shall not be deemed inconsistent to the extent they do not represent an amount of Trust Preferred Securities in excess of those held in the name of the Depositary or its nominee. If at any time the Depositary for any Trust Preferred Securities represented by one or more Global Securities notifies the Trust that it is unwilling or unable to continue as Depositary 46 for such Trust Preferred Securities or if at any time the Depositary for such Trust Preferred Securities shall no longer be eligible, the Trust shall appoint a successor Depositary with respect to such Trust Preferred Securities. If a successor Depositary for such Trust Preferred Securities is not appointed by the Trust within 90 days after the Trust receives such notice or becomes aware of such ineligibility, the Trust's election that such Trust Preferred Securities be represented by one or more Global Securities shall no longer be effective and the Trust shall execute, and the Property Trustee will authenticate and deliver, Trust Preferred Securities in definitive registered form, in any authorized denominations, in an aggregate liquidation amount equal to the principal amount of the Global Security or Trust Preferred Securities representing such Trust Preferred Securities in exchange for such Global Security or Trust Preferred Securities. The Trust may at any time and in its sole discretion determine that the Trust Preferred Securities issued in the form of one or more Global Securities shall no longer be represented by a Global Security or Trust Preferred Securities. In such event the Trust shall execute, and the Property Trustee, shall authenticate and deliver, Trust Preferred Securities in definitive registered form, in any authorized denominations, in an aggregate liquidation amount equal to the principal amount of the Global Security or Trust Preferred Securities representing such Trust Preferred Securities, in exchange for such Global Security or Trust Preferred Securities. Notwithstanding any other provisions of this Trust Agreement (other than the provisions set forth in Section 7.9), Global Securities may not be transferred as a whole 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 by the Depositary or any such nominee to a successor Depositary or a nominee of such successor Depositary. Subject to the second and third preceding paragraphs, interests of beneficial owners in a Global Security may be transferred or exchanged for Trust Preferred Securities not represented by a Global Security and Trust Preferred Securities not represented by a Global Security may be transferred or exchange for Global Securities in accordance with rules of the Depositary and the provisions of Section 7.9. [SECTION 7.13 Over-Allotment Option. (a) The Administrative Trustees, on behalf of the Trust, and the Sponsor may grant to the underwriters or initial purchasers who are underwriting or purchasing, as the case may be, any series of Trust Preferred Securities, an option (the "Option") to purchase an additional liquidation amount of such series of Trust Preferred Securities on the terms and conditions specified in the underwriting agreement or purchase agreement, as the case may be, relating to such Trust Preferred Securities; PROVIDED, HOWEVER, the Option may only be granted if the following conditions are satisfied: (i) the Option, if exercised, may not result in the issue and sale of an aggregate liquidation amount of Trust Preferred Securities greater than that registered by the Sponsor and the Trust on the applicable registration statement or registration statements (including by a registration statement filed under Rule 462(b) under the Securities Act, if any), as the case may be, with the Commission under the Securities Act; 47 (ii) the Option must result, if exercised, in the issuance and sale of Trust Preferred Securities to such underwriters or initial purchasers, as the case may be, and the issuance and sale of Common Securities to the Sponsor on a Pro Rata basis and not in contravention of any other provision of this Agreement or the Business Trust Act, consistent with Section 5.1; and (iii) the Trust Preferred Securities and the Common Securities issued and sold subject to the exercise of the Option, if any, must be of the same series and must bear the same CUSIP numbers as the series of Trust Preferred Securities and the Common Securities, respectively, which were initially issued and sold by the Trust and the Sponsor, respectively. (b) With respect to any issuance of Trust Preferred Securities and Common Securities following the exercise of the Option, (i) the designation the "__% Trust Preferred Securities" and, for all purposes under this Trust Agreement, the defined terms the "Trust Preferred Securities" shall mean both the Trust Preferred Securities issued initially hereunder and any Trust Preferred Securities issued pursuant to the exercise of the Option; and (ii) the designation the "__% Common Securities" and, for all purposes under this Trust Agreement, the defined term the "Common Securities" shall mean both the Common Securities issued initially hereunder and any Common Securities issued pursuant to the requirement of Section 7.13(a)(ii) regarding the additional issuance of Common Securities on a Pro Rata basis if the Option is exercised. (c) If the Option set forth in Section 7.13(a) is exercised on a date other than the initial Closing Date, then the parties to the Trust Agreement shall cause there to occur a second closing for the consummation of the sale of the Trust Preferred Securities and Common Securities under substantially the same conditions that applied to the initial closing of the sale of such securities, including the following: (i) the execution and delivery of a second Trust Preferred Security Certificate, or such additional Trust Preferred Security Certificates, as appropriate, which is, or are, as the case may be, substantially identical in all respects to the Trust Preferred Security Certificate issued initially; and (ii) the execution and delivery of a second Common Security Certificate, or such additional Common Security Certificate, as appropriate, which is, or are, as the case may be, substantially identical in all relevant respects to the Common Security Certificate issued initially.] Section 7.14 Cancellation. All Certificates surrendered for payment, redemption, registration of transfer or exchange shall, if surrendered to any Person other than the Property Trustee, be delivered to the Property 48 Trustee and shall be promptly cancelled by it. No Certificates shall be executed or authenticated in lieu of or in exchange for any Certificates cancelled as provided in this Section, except as permitted by this Trust Agreement. All cancelled Certificates held by the Property Trustee shall be disposed of by it in accordance with its customary procedures. ARTICLE 8 DISSOLUTION AND TERMINATION OF TRUST SECTION 8.1 Dissolution and Termination of Trust. (a) The Trust shall dissolve upon the earliest of: (i) a Bankruptcy Event with respect to the Holder of the Common Securities or the Sponsor; (ii) the filing of a certificate of dissolution or its equivalent with respect to the Sponsor; the dissolution of the Trust after obtaining the consent of the Holders of at least a Majority in Liquidation Amount of the Securities to dissolve the Trust; or the revocation of the Sponsor's charter and the expiration of 90 days after the date of revocation without a reinstatement thereof; (iii) the entry of a decree of judicial dissolution of the Sponsor or the Trust; (iv) the time when all of the Securities shall have been called for redemption and the amounts then due shall have been paid to the Holders in accordance with the terms of the Securities; (v) at the Sponsor's election by notice and direction to the Property Trustee to distribute the Junior Subordinated Notes to the Holders of the Securities in exchange for all of the Securities; PROVIDED that the Sponsor will be required to obtain an opinion of an independent counsel that the distribution of the Junior Subordinated Notes will not be taxable to the Holders of the Trust Preferred Securities for United States federal income tax purposes; or (vi) the time when all of the Administrative Trustees and the Sponsor shall have consented to dissolution of the Trust provided such action is taken before the issuance of any Securities. (b) As soon as is practicable after the occurrence of an event referred to in Section 8.1(a) and upon completion of the winding up and liquidation of the Trust, the Trustees shall terminate the Trust by filing a certificate of cancellation with the Secretary of State of the State of Delaware. (c) The provisions of Section 4.2 and Article 9 shall survive the termination of the Trust. SECTION 8.2 Liquidation Distribution Upon Dissolution of the Trust. 49 (a) In the event of any voluntary or involuntary liquidation, dissolution, or winding-up of the Trust (each a "Liquidation"), the Holders of the Securities on the date of the Liquidation will be entitled to receive, out of the assets of the Trust available for distribution to Holders of Securities after satisfaction of the Trusts' liabilities to creditors, if any, distributions in cash or other immediately available funds in an amount equal to the aggregate of the stated liquidation amount of $__ per Security plus accumulated and unpaid Distributions thereon to the date of payment (such amount being the "Liquidation Distribution"), unless, in connection with such Liquidation, Junior Subordinated Notes in an aggregate stated principal amount equal to the aggregate stated liquidation amount of, with an interest rate identical to the distribution rate of, and accrued and unpaid interest equal to accumulated and unpaid Distributions on, such Securities shall be distributed on a Pro Rata basis to the Holders of the Securities in exchange for such Securities. (b) If, upon any such Liquidation, the Liquidation Distribution can be paid only in part because the Trust has insufficient assets available to pay in full the aggregate Liquidation Distribution, then the amounts payable directly by the Trust on the Securities shall be paid on a Pro Rata basis. The Holders of the Common Securities will be entitled to receive distributions upon any such Liquidation Pro Rata with the Holders of the Trust Preferred Securities except that if an Indenture Event of Default has occurred and is continuing, the Trust Preferred Securities shall have a preference over the Common Securities with regard to such distributions. ARTICLE 9 LIMITATION OF LIABILITY OF HOLDERS OF SECURITIES, DELAWARE TRUSTEES OR OTHERS SECTION 9.1 Liability. (a) Except as expressly set forth in this Trust Agreement, the Guarantee and the terms of the Securities, the Sponsor: (i) shall not be personally liable for the return of any portion of the capital contributions (or any return thereon) of the Holders of the Securities which shall be made solely from assets of the Trust; and (ii) shall not be required to pay to the Trust or to any Holder of Securities any deficit upon dissolution of the Trust or otherwise. (b) Pursuant to Section 3803(a) of the Business Trust Act, the Holder of the Common Securities shall be entitled to the same limitation of personal liability extended to stockholders of private corporations for profit organized under the General Corporation Law of the State of Delaware; provided, however, the Holders of the Common Securities shall be liable for all of the debts and obligations of the Trust (other than with respect to the Securities) to the extent not satisfied out of the Trust's assets. 50 (c) Pursuant to Section 3803(a) of the Business Trust Act, the Holders of the Trust Preferred Securities shall be entitled to the same limitation of personal liability extended to stockholders of private corporations for profit organized under the General Corporation Law of the State of Delaware. SECTION 9.2 Exculpation. (a) No Indemnified Person shall be liable, responsible or accountable in damages or otherwise to the Trust or any Covered Person for any loss, damage or claim incurred by reason of any act or omission performed or omitted by such Indemnified Person in good faith on behalf of the Trust and in a manner such Indemnified Person reasonably believed to be within the scope of the authority conferred on such Indemnified Person by this Trust Agreement or by law, except that, subject to section 3.11, an Indemnified Person shall be liable for any such loss, damage or claim incurred by reason of such Indemnified Person's negligence or willful misconduct with respect to such acts or omissions. (b) An Indemnified Person shall be fully protected in relying in good faith upon the records of the Trust and upon such information, opinions, reports or statements presented to the Trust by any Person as to matters the Indemnified Person reasonably believes are within such other Person's professional or expert competence and who has if selected by such Indemnified Person, been selected by such Indemnified Person with reasonable care on behalf of the Trust, including information, opinions, reports or statements as to the value and amount of the assets, liabilities, profits, losses or any other facts pertinent to the existence and amount of assets from which Distributions to Holders of Securities might properly be paid. SECTION 9.3 Fiduciary Duty. (a) To the extent that, at law or in equity, an Indemnified Person has duties (including fiduciary duties) and liabilities relating thereto to the Trust or to any other Covered Person, an Indemnified Person acting under this Trust Agreement shall not be liable to the Trust or to another Covered Person for its good faith reliance on the provisions of this Trust Agreement. The provisions of this Trust Agreement, to the extent that they restrict the duties and liabilities of an Indemnified Person otherwise existing at law or in equity (other than the duties imposed on the Property Trustee under the Trust Indenture Act), are agreed by the parties hereto to replace such other duties and liabilities of such Indemnified Person. (b) Unless otherwise expressly provided herein: (i) whenever a conflict of interest exists or arises between any Covered Person and any Indemnified Person; or (ii) whenever this Trust Agreement or any other agreement contemplated herein or therein provides that an Indemnified Person shall act in a manner that is, or provides terms that are, fair and reasonable to the Trust or any Holder of Securities, 51 the Indemnified Person shall resolve such conflict of interest, take such action or provide such terms, considering in each case the relative interest of each party (including its own interest) to such conflict, agreement, transaction or situation and the benefits and burdens relating to such interests, any customary or accepted industry practices and any applicable generally accepted accounting practices or principles. In the absence of bad faith by the Indemnified Person, the resolution, action or term so made, taken or provided by the Indemnified Person shall not constitute a breach of this Trust Agreement or any other agreement contemplated herein or of any duty or obligation of the Indemnified Person at law or in equity or otherwise. (c) Whenever in this Trust Agreement an Indemnified Person is permitted or required to make a decision: (i) in its "discretion" or under a grant of similar authority, the Indemnified Person shall be entitled to consider such interests and factors as it desires, including its own interests, and shall have no duty or obligation to give any consideration to any interest of or factors affecting the Trust or any other Person; or (ii) in its "good faith" or under another express standard, the Indemnified Person shall act under such express standard and shall not be subject to any other or different standard imposed by this Trust Agreement or by applicable law. SECTION 9.4 Indemnification. (a)(i) The Junior Subordinated Note Issuer shall indemnify, to the full extent permitted by law, any Junior Subordinated Note Issuer Indemnified Person who was or is a party or is threatened to be made a party to any threatened, pending or completed action, suit or proceeding, whether civil, criminal, administrative or investigative (other than an action by or in the right of the Trust) by reason of the fact that he is or was a Junior Subordinated Notes Issuer Indemnified Person against expenses (including attorney fees), judgments, fines and amounts paid in settlement actually and reasonably incurred by him in connection with such action, suit or proceeding if he acted in good faith and in a manner he reasonably believed to be in or not opposed to the best interests of the Trust, and, with respect to any criminal action or proceeding, had no reasonable cause to believe his conduct was unlawful. The termination of any action, suit or proceeding by judgment, order, settlement, conviction or upon a plea of nolo contendere or its equivalent, shall not, of itself, create a presumption that the Junior Subordinated Notes Issuer Indemnified Person did not act in good faith and in a manner which he reasonably believed to be in or not opposed to the best interests of the Trust, and, with respect to any criminal action or proceeding, had reasonable cause to believe that his conduct was unlawful. (ii) The Junior Subordinated Note Issuer shall indemnify, to the full extent permitted by law, any Junior Subordinated Notes Issuer Indemnified Person who was or is a party or is threatened to be made a party to any threatened, pending or completed action or suit by or in the right of the Trust to procure a judgment in its favor by reason of the fact that he is or was a Junior Subordinated Notes Issuer Indemnified Person against expenses (including attorneys' fees) actually and reasonably incurred by him in connection with the defense or settlement of such action or suit if he acted in good faith and in a manner he reasonably believed to be in or 52 not opposed to the best interests of the Trust and except that no such indemnification shall be made in respect of any claim, issue or matter as to which such Junior Subordinated Notes Issuer Indemnified Person shall have been adjudged to be liable to the Trust unless and only to the extent that the Court of Chancery of Delaware or the court in which such action or suit was brought shall determine upon application that, despite the adjudication of liability but in view of all the circumstances of the case, such person is fairly and reasonably entitled to indemnity for such expenses which such Court of Chancery or such other court shall deem proper. (iii) Any indemnification under paragraphs (i) and (ii) of this Section 9.4(a) (unless ordered by a court) shall be made by the Junior Subordinated Note Issuer only as authorized in the specific case upon a determination that indemnification of the Junior Subordinated Notes Issuer Indemnified Person is proper in the circumstances because he has met the applicable standard of conduct set forth in paragraphs (i) and (ii). Such determination shall be made (1) by the Administrative Trustees by a majority vote of a quorum consisting of such Administrative Trustees who were not parties to such action, suit or proceeding, (2) if such a quorum is not obtainable, or, even if obtainable, if a quorum of disinterested Administrative Trustees so directs, by independent legal counsel in a written opinion, or (3) by the Holders of the Common Securities of the Trust. (iv) Expenses (including attorneys' fees) incurred by a Junior Subordinated Notes Issuer Indemnified Person in defending a civil, criminal, administrative or investigative action, suit or proceeding referred to in paragraphs (i) and (ii) of this Section 9.4(a) shall be paid by the Junior Subordinated Note Issuer in advance of the final disposition of such action, suit or proceeding upon receipt of an undertaking by or on behalf of such Junior Subordinated Debt- Securities Issuer Indemnified Person to repay such amount if it shall ultimately be determined that he is not entitled to be indemnified by the Junior Subordinated Note Issuer as authorized in this Section 9.4(a). Notwithstanding the foregoing, no advance shall be made by the Junior Subordinated Note Issuer if a determination is reasonably and promptly made (i) by the Administrative Trustees by a majority vote of a quorum of disinterested Administrative Trustees, (ii) if such a quorum is not obtainable, or, even if obtainable, if a quorum of disinterested Administrative Trustees so directs, by independent legal counsel in a written opinion or (iii) the Common Security Holder of the Trust, that, based upon the facts known to the Administrative Trustees, counsel or the Common Security Holder at the time such determination is made, such Junior Subordinated Notes Issuer Indemnified Person acted in bad faith or in a manner that such person did not believe to be in or not opposed to the best interests of the Trust, or, with respect to any criminal proceeding, that such Junior Subordinated Notes Issuer Indemnified Person believed or had reasonable cause to believe his conduct was unlawful. In no event shall any advance be made in instances where the Administrative Trustees, independent legal counsel or Common Security Holder reasonably determine that such person deliberately breached his duty to the Trust or its Common or Trust Preferred Security Holders. (v) The indemnification and advancement of expenses provided by, or granted pursuant to, the other paragraphs of this Section 9.4(a) shall not be deemed exclusive of any other rights to which those seeking indemnification and advancement of expenses may be entitled under any agreement, vote of stockholders or disinterested directors of the Junior Subordinated Note Issuer or Trust Preferred Security Holders of the Trust or otherwise, both as 53 to action in his official capacity and as to action in another capacity while holding such office. All rights to indemnification under this Section 9.4(a) shall be deemed to be provided by a contract between the Junior Subordinated Note Issuer and each Junior Subordinated Notes Issuer Indemnified Person who serves in such capacity at any time while this Section 9.4(a) is in effect. Any repeal or modification of this Section 9.4(a) shall not affect any rights or obligations then existing. (vi) The Junior Subordinated Note Issuer or the Trust may purchase and maintain insurance on behalf of any person who is or was a Junior Subordinated Notes Issuer Indemnified Person against any liability asserted against him and incurred by him in any such capacity, or arising out of his status as such, whether or not the Junior Subordinated Note Issuer would have the power to indemnify him against such liability under the provisions of this Section 9.4(a). (vii) For purposes of this Section 9.4(a), references to "the Trust" shall include, in addition to the resulting or surviving entity, any constituent entity (including any constituent of a constituent) absorbed in a consolidation or merger, so that any person who is or was a director, trustee, officer or employee of such constituent entity, or is or was serving at the request of such constituent entity as a director, trustee, officer, employee or agent of another entity, shall stand in the same position under the provisions of this Section 9.4(a) with respect to the resulting or surviving entity as he would have with respect to such constituent entity if its separate existence had continued. (viii) The indemnification and advancement of expenses provided by, or granted pursuant to, this Section 9.4(a) shall, unless otherwise provided when authorized or ratified, continue as to a person who has ceased to be a Junior Subordinated Notes Issuer Indemnified Person and shall inure to the benefit of the heirs, executors and administrators of such a person. The obligation to indemnify as set forth in this Section 9.4(a) shall survive the resignation or removal of the Delaware Trustee or the Property Trustee or the termination of this Trust Agreement. (b) The Junior Subordinated Note Issuer agrees to indemnify the (i) Property Trustee, (ii) the Delaware Trustee, (iii) any Affiliate of the Property Trustee or the Delaware Trustee, and (iv) any officers, directors, shareholders, members, partners, employees, representatives, custodians, nominees or agents of the Property Trustee or the Delaware Trustee (each of the Persons in (i) through (iv) being referred to as a "Fiduciary Indemnified Person") for, and to hold each Fiduciary Indemnified Person harmless against, any loss, liability or expense incurred without gross negligence or willful misconduct on its part, arising out of or in connection with the acceptance or administration of the trust or trusts hereunder, including the costs and expenses (including reasonable legal fees and expenses) of defending itself against or investigating any claim or liability in connection with the exercise or performance of any of its powers or duties hereunder. The obligation to indemnify as set forth in this Section 9.4(b) shall survive the resignation and removal of the Delaware Trustee or the Property Trustee and the dissolution of the Trust and the termination of this Trust Agreement. In addition, the Junior Subordinated Note Issuer has agreed in the Indenture to pay the fees and expenses of the Delaware Trustee and the Property Trustee. 54 SECTION 9.5 Outside Businesses. Subject to the provisions of Section 6.3, any Covered Person, the Sponsor, the Delaware Trustee and the Property Trustee may engage in or possess an interest in other business ventures of any nature or description, independently or with others, similar or dissimilar to the activities of the Trust, and the Trust and the Holders of Securities shall have no rights by virtue of this Trust Agreement in and to such independent ventures or the income or profits derived therefrom, and the pursuit of any such venture, even if competitive with the activities of the Trust, shall not be deemed wrongful or improper. No Covered Person, the Sponsor, the Delaware Trustee or the Property Trustee shall be obligated to present any particular investment or other opportunity to the Trust even if such opportunity is of a character that, if presented to the Trust, could be taken by the Trust, and any Covered Person, the Sponsor, the Delaware Trustee and the Property Trustee shall have the right to take for its own account (individually or as a partner or fiduciary) or to recommend to others any such particular investment or other opportunity. Any Covered Person, the Delaware Trustee and the Property Trustee may engage or be interested in any financial or other transaction with the Sponsor or any Affiliate of the Sponsor, or may act as depositary for, trustee or agent for, or act on any committee or body of holders of, securities or other obligations of the Sponsor or its Affiliates. ARTICLE 10 ACCOUNTING SECTION 10.1 Fiscal Year. The fiscal year ("Fiscal Year") of the Trust shall be the calendar year, or such other year as is required by the Code. SECTION 10.2 Certain Accounting Matters. (a) At all times during the existence of the Trust, the Administrative Trustees shall keep, or cause to be kept, full books of account, records and supporting documents, which shall reflect in reasonable detail, each transaction of the Trust. The books of account shall be maintained on the accrual method of accounting, in accordance with generally accepted accounting principles, consistently applied. The Trust shall use the accrual method of accounting for United States federal income tax purposes. The books of account and the records of the Trust shall be examined by and reported upon as of the end of each Fiscal Year of the Trust by a firm of independent certified public accountants selected by the Administrative Trustees. (b) The Administrative Trustees shall cause to be prepared and delivered to each of the Holders of Securities, within 90 days after the end of each Fiscal Year of the Trust, annual financial statements of the Trust, including a balance sheet of the Trust as of the end of such Fiscal Year, and the related statements of income or loss. (c) The Administrative Trustees shall cause to be duly prepared and delivered to each of the Holders of Securities, an annual United States federal income tax information statement, 55 required by the Code, containing such information with regard to the Securities held by each Holder as is required by the Code and the Treasury Regulations. Notwithstanding any right under the Code to deliver any such statement at a later date, the Administrative Trustees shall endeavor to deliver all such statements within 30 days after the end of each Fiscal Year of the Trust. (d) The Administrative Trustees shall cause to be duly prepared and filed with the appropriate taxing authority, an annual United States federal income tax return, on a Form 1041 or such other form required by United States federal income tax law, and any other annual income tax returns required to be filed by the Administrative Trustees on behalf of the Trust with any state or local taxing authority. SECTION 10.3 Banking. The Trust shall maintain one or more bank accounts in the name and for the sole benefit of the Trust; provided, however, that all payments of funds in respect of the Junior Subordinated Notes held by the Property Trustee shall be made directly to the Property Account and no other funds of the Trust shall be deposited in the Property Account. The sole signatories for such accounts shall be designated by the Administrative Trustees; provided, however, that the Property Trustee shall designate the signatories for the Property Account. SECTION 10.4 Withholding. The Trust and the Administrative Trustees shall comply with all withholding requirements under United States federal, state and local law. The Trust shall request, and the Holders shall provide to the Trust, such forms or certificates as are necessary to establish an exemption from withholding with respect to each Holder, and any representations and forms as shall reasonably be requested by the Trust to assist it in determining the extent of, and in fulfilling, its withholding obligations. The Administrative Trustees shall file required forms with applicable jurisdictions and, unless an exemption from withholding is properly established by a Holder, shall remit amounts withheld with respect to the Holder to applicable jurisdictions. To the extent that the Trust is required to withhold and pay over any amounts to any authority with respect to distributions or allocations to any Holder, the amount withheld shall be deemed to be a distribution in the amount of the withholding to the Holder. In the event of any claimed over withholding, Holders shall be limited to an action against the applicable jurisdiction. If the amount required to be withheld was not withheld from actual Distributions made, the Trust may reduce subsequent Distributions by the amount of such withholding. ARTICLE 11 AMENDMENTS AND MEETINGS SECTION 11.1 Amendments. (a) Except as otherwise provided in this Trust Agreement or by any applicable terms of the Securities, this Trust Agreement may only be amended by a written instrument approved and 56 executed by the Sponsor and (i) the Administrative Trustees (or, if there are more than two Administrative Trustees, a majority of the Administrative Trustees), (ii) the Property Trustee; and (iii) the Delaware Trustee if the amendment affects the rights, powers, duties, obligations or immunities of the Delaware Trustee. (b) No amendment shall be made, and any such purported amendment shall be void and ineffective: (i) unless, the Property Trustee shall have first received: a. an Officers' Certificate from each of the Trust and the Sponsor that such amendment is permitted by, and conforms to, the terms of this Trust Agreement (including the terms of the Securities) and that all conditions precedent to the execution and delivery of such amendment have been satisfied; and b. an opinion of counsel (who may be counsel to the Sponsor or the Trust) that such amendment is permitted by, and conforms to, the terms of this Trust Agreement (including the terms of the Securities) and that all conditions precedent to the execution and delivery of such amendment have been satisfied; and (ii) to the extent the result of such amendment would be to: a. cause the Trust to be classified other than as a grantor trust for United States federal income tax purposes; b. reduce or otherwise adversely affect the powers of the Property Trustee in contravention of the Trust Indenture Act; or c. cause the Trust to be deemed to be an Investment Company required to be registered under the Investment Company Act. (c) If the Trust has issued any Securities that remain outstanding: (i) any amendment that would (a) change the amount or timing of any distribution of the Securities or otherwise adversely affect the amount of any distribution required to be made in respect of the Securities as of a specified date or (b) restrict the right of a Holder of Securities to institute suit for the enforcement of any such payment on or after such date, will entitle the Holders of such Securities, voting together as a single class, to vote on such amendment or proposal and such amendment or proposal shall not be effective except with the approval of each of the Holders of the Securities affected thereby; and (ii) any amendment that would (a) adversely affect the powers, preferences or special rights of the Securities, whether by way of amendment to this Trust Agreement or otherwise or (b) result in the dissolution, winding-up or termination of the Trust other than pursuant to the terms of this Trust Agreement, will entitle the holders of the Securities voting together as a single class to vote on such amendment or proposal and such amendment or proposal shall not be 57 effective except with the approval of the Holders of the majority in liquidation amount of the Securities affected thereby; provided that, if any amendment or proposal referred to in clause (a) above would adversely affect only the Trust Preferred Securities or the Common Securities, then only the affected class will be entitled to vote on such amendment or proposal and such amendment or proposal. (d) This Section 11.1 shall not be amended without the consent of all of the Holders of the Securities. (e) Article 4 shall not be amended without the consent of the Holders of a Majority in Liquidation Amount of the Common Securities. (f) The rights of the Holders of the Common Securities under Article 6 to increase or decrease the number of, and appoint and remove Trustees shall not be amended without the consent of the Holders of a Majority in Liquidation Amount of the Common Securities. (g) Notwithstanding Section 11.1(c), this Trust Agreement may be amended without the consent of the Holders of the Securities, if such amendment does not adversely affect in any material respect the rights of the holders of the Securities, to: (i) cure any ambiguity; (ii) correct or supplement any provision in this Trust Agreement that may be defective or inconsistent with any other provision of this Trust Agreement or to make any other provisions with respect to matters or questions arising under this Trust Agreement that shall not be inconsistent with the other provisions of this Trust Agreement; (iii) add to the covenants, restrictions or obligations of the Sponsor; (iv) to conform to any change in Rule 3a-5 of the Investment Company Act or written change in interpretation or application of Rule 3a-5 of the Investment Company Act by any legislative body, court, government agency or regulatory authority; or (v) to modify, eliminate and add to any provision of this Trust Agreement to ensure that the Trust will be classified as a grantor trust for United States federal income tax purposes at all times that any Securities are outstanding or to ensure that the Trust will not be required to register as an Investment Company under the Investment Company Act. (h) Neither the Property Trustee nor the Delaware Trustee shall be required to sign any amendment that affects its rights, duties, obligations or immunities under this Declaration or otherwise. SECTION 11.2 Meetings of the Holders of Securities; Action by Written Consent. (a) Meetings of the Holders of any class of Securities may be called at any time by the Administrative Trustees (or as provided in the terms of the Securities) to consider and act on any matter on which Holders of such class of Securities are entitled to act under the terms of this 58 Trust Agreement, the terms of the Securities or the rules of any stock exchange on which the Trust Preferred Securities are listed or admitted for trading. The Administrative Trustees shall call a meeting of the Holders of such class if directed to do so by the Holders of at least 10% in Liquidation Amount of such class of Securities. Such direction shall be given by delivering to the Administrative Trustees one or more calls in a writing stating that the signing Holders of Securities wish to call a meeting and indicating the general or specific purpose for which the meeting is to be called. Any Holders of Securities calling a meeting shall specify in writing the Certificates held by the Holders of Securities exercising the right to call a meeting and only those Securities specified shall be counted for purposes of determining whether the required percentage set forth in the second sentence of this paragraph has been met. (b) Except to the extent otherwise provided in the terms of the Securities, the following provisions shall apply to meetings of Holders of Securities: (i) notice of any such meeting shall be given to all the Holders of Securities having a right to vote thereat at least 7 days and not more than 60 days before the date of such meeting. Whenever a vote, consent or approval of the Holders of Securities is permitted or required under this Trust Agreement or the rules of any stock exchange on which the Trust Preferred Securities are listed or admitted for trading, such vote, consent or approval may be given at a meeting of the Holders of Securities. Any action that may be taken at a meeting of the Holders of Securities may be taken without a meeting and without prior notice if a consent in writing setting forth the action so taken is signed by the Holders of Securities owning not less than the minimum amount of Securities in liquidation amount that would be necessary to authorize or take such action at a meeting at which all Holders of Securities having a right to vote thereon were present and voting. Prompt notice of the taking of action without a meeting shall be given to the Holders of Securities entitled to vote who have not consented in writing. The Administrative Trustees may specify that any written ballot submitted to the Security Holders for the purpose of taking any action without a meeting shall be returned to the Trust within the time specified by the Administrative Trustees; (ii) each Holder of a Security may authorize any Person to act for it by proxy on all matters in which a Holder of Securities is entitled to participate, including waiving notice of any meeting, or voting or participating at a meeting. No proxy shall be valid after the expiration of 11 months from the date thereof unless otherwise provided in the proxy. Every proxy shall be revocable at the pleasure of the Holder of Securities executing such proxy. Except as otherwise provided herein, all matters relating to the giving, voting or validity of proxies shall be governed by the General Corporation Law of the State of Delaware relating to proxies, and judicial interpretations thereunder, as if the Trust were a Delaware corporation and the Holders of the Securities were stockholders of a Delaware corporation; (iii) each meeting of the Holders of the Securities shall be conducted by the Administrative Trustees or by such other Person that the Administrative Trustees may designate; and (iv) unless the Business Trust Act, this Trust Agreement, the terms of the Securities, the Trust Indenture Act or the listing rules of any stock exchange on which the Trust Preferred 59 Securities are then listed for trading, otherwise provides, the Administrative Trustees, in their sole discretion, shall establish all other provisions relating to meetings of Holders of Securities, including notice of the time, place or purpose of any meeting at which any matter is to be voted on by any Holders of Securities, waiver of any such notice, action by consent without a meeting, the establishment of a record date, quorum requirements, voting in person or by proxy or any other matter with respect to the exercise of any such right to vote. ARTICLE 12 REPRESENTATIONS OF PROPERTY TRUSTEE AND DELAWARE TRUSTEE SECTION 12.1 Representations and Warranties of the Property Trustee. The Trustee that acts as initial Property Trustee represents and warrants to the Trust and to the Sponsor at the date of this Trust Agreement, and each Successor Property Trustee represents and warrants to the Trust and the Sponsor at the time of the Successor Property Trustee's acceptance of its appointment as Property Trustee that: (a) the Property Trustee is a banking corporation, validly existing and in good standing under the laws of the jurisdiction of its incorporation or organization, with trust power and authority to execute and deliver, and to carry out and perform its obligations under the terms of, this Trust Agreement; (b) the Property Trustee satisfies the requirements set forth in Section 6.3(a); (c) the execution, delivery and performance by the Property Trustee of this Trust Agreement has been duly authorized by all necessary corporate action on the part of the Property Trustee. This Trust Agreement has been duly executed and delivered by the Property Trustee, and it constitutes a legal, valid and binding obligation of the Property Trustee, enforceable against it in accordance with its terms, subject to applicable bankruptcy, reorganization, moratorium, insolvency and other similar laws affecting creditors' rights generally and to general principles of equity and the discretion of the court (regardless of whether the enforcement of such remedies is considered in a proceeding in equity or at law); (d) the execution, delivery and performance of this Trust Agreement by the Property Trustee does not conflict with or constitute a breach of the articles of association or incorporation, as the case may be, or the by-laws (or other similar organizational documents) of the Property Trustee; and (e) no consent, approval or authorization of, or registration with or notice to, any State (which term, in the case of the initial Property Trustee, shall mean the State of New York) or 60 federal banking authority having jurisdiction over the trust powers of the Property Trustee is required for the execution, delivery or performance by the Property Trustee of this Trust Agreement. SECTION 12.2 Representations and Warranties of the Delaware Trustee. The Trustee that acts as initial Delaware Trustee represents and warrants to the Trust and to the Sponsor at the date of this Trust Agreement, and each Successor Delaware Trustee represents and warrants to the Trust and the Sponsor at the time of the Successor Delaware Trustee's acceptance of its appointment as Delaware Trustee that: (a) the Delaware Trustee satisfies the requirements set forth in Section 6.2, satisfies Trust Section 3807 of the Business Trust Act and has the power and authority to execute and deliver, and to carry out and perform its obligations under the terms of, this Trust Agreement and, if it is not a natural person, is duly organized, validly existing and in good standing under the laws of its jurisdiction of incorporation or organization; (b) the Delaware Trustee has been authorized to perform its obligations under the Certificate of Trust and this Trust Agreement. This Trust Agreement under Delaware law constitutes a legal, valid and binding obligation of the Delaware Trustee, enforceable against it in accordance with its terms, subject to applicable bankruptcy, reorganization, moratorium, insolvency and other similar laws affecting creditors' rights generally and to general principles of equity and the discretion of the court (regardless of whether the enforcement of such remedies is considered in a proceeding in equity or at law); and (c) no consent, approval or authorization of, or registration with or notice to, the State of Delaware or federal banking authority is required for the execution, delivery or performance by the Delaware Trustee of this Trust Agreement ARTICLE 13 MISCELLANEOUS SECTION 13.1 Notices. All notices provided for in this Trust Agreement shall be in writing, duly signed by the party giving such notice, and shall be delivered, telecopied or mailed by registered or certified mail, as follows: (a) if given to the Trust, in care of the Administrative Trustees at the Trust's mailing address set forth below (or such other address as the Trust may give notice of to the Property Trustee, the Delaware Trustee and the Holders of the Securities): c/o Virginia Electric and Power Company One James River Plaza 701 East Cary Street 61 Richmond, Virginia 23219 (b) if given to the Delaware Trustee, at the mailing address set forth below (or such other address as the Delaware Trustee may give notice of to the Administrative Trustees, the Property Trustee and the Holders of the Securities): Chase Manhattan Bank Delaware 1201 Market Street Wilmington, Delaware 19801 Attention: Capital Markets Fiduciary Services (c) if given to the Property Trustee, at its Corporate Trust Office (or such other address as the Property Trustee may give notice of to the Administrative Trustees, the Delaware Trustee and the Holders of the Securities). (d) if given to the Holder of the Common Securities, at the mailing address of the Sponsor set forth below (or such other address as the Holder of the Common Securities may give notice of to the Property Trustee, the Delaware Trustee and the Trust): (e) if given to any other Holder, at the address set forth on the Security Register. All such notices shall be deemed to have been given when received in person, telecopied with receipt confirmed or mailed by first class mail, postage prepaid except that if a notice or other document is refused delivery or cannot be delivered because of a changed address of which no notice was given, such notice or other document shall be deemed to have been delivered on the date of such refusal or inability to deliver. SECTION 13.2 Governing Law. This Trust Agreement and the rights of the parties hereunder shall be governed by and interpreted in accordance with the laws of the State of Delaware, provided that the immunities and standard of care of the Property Trustee in connection with the administration of its trusts hereunder shall be governed by and interpreted in accordance with the laws of the jurisdiction of its incorporation. SECTION 13.3 Intention of the Parties. It is the intention of the parties hereto that the Trust be classified for United States federal income tax purposes as a grantor trust. The provisions of this Trust Agreement shall be interpreted in a manner consistent with such classification. SECTION 13.4 Headings. Headings contained in this Trust Agreement are inserted for convenience of reference only and do not affect the interpretation of this Trust Agreement or any provision hereof. 62 SECTION 13.5 Successors and Assigns. Whenever in this Trust Agreement any of the parties hereto is named or referred to, the successors and assigns of such party shall be deemed to be included, and all covenants and agreements in this Trust Agreement by the Sponsor and the Trustees shall bind and inure to the benefit of their respective successors and assigns, whether so expressed. SECTION 13.6 Partial Enforceability. If any provision of this Trust Agreement, or the application of such provision to any Person or circumstance, shall be held invalid, the remainder of this Trust Agreement, or the application of such provision to persons or circumstances other than those to which it is held invalid, shall not be affected thereby. SECTION 13.7 Counterparts. This Trust Agreement may contain more than one counterpart of the signature page and this Trust Agreement may be executed by the affixing of the signature of each of the Trustees and the Sponsor to one of such counterpart signature pages. All of such counterpart signature pages shall be read as though one, and they shall have the same force and effect as though all of the signers had signed a single signature page. [THE REST OF THIS PAGE HAS BEEN LEFT BLANK INTENTIONALLY; THE SIGNATURE PAGE FOLLOWS.] 63 IN WITNESS WHEREOF, the undersigned have caused these presents to be executed as of the day and year first above written. VIRGINIA ELECTRIC AND POWER. COMPANY, as Sponsor, as Common Securities Holder and as Junior Subordinated Note Issuer By:____________________________________ Name: Title: THE CHASE MANHATTAN BANK, as Property Trustee By:____________________________________ Name: Title: CHASE MANHATTAN BANK DELAWARE, as Delaware Trustee By:____________________________________ Name: Title: _______________________________________ [NAME], as Administrative Trustee _______________________________________ [NAME], as Administrative Trustee _______________________________________ [NAME], as Administrative Trustee 64 EXHIBIT A [IF THE CAPITAL SECURITY IS TO BE A GLOBAL CAPITAL SECURITY, INSERT THE FOLLOWING: THIS TRUST PREFERRED SECURITY IS A GLOBAL TRUST PREFERRED SECURITY WITHIN THE MEANING OF THE TRUST AGREEMENT HEREINAFTER REFERRED TO AND IS REGISTERED IN THE NAME OF THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION (THE "DEPOSITARY"), OR A NOMINEE OF THE DEPOSITARY. THIS TRUST PREFERRED SECURITY IS EXCHANGEABLE FOR TRUST PREFERRED SECURITIES REGISTERED IN THE NAME OF A PERSON OTHER THAN THE DEPOSITARY OR ITS NOMINEE ONLY IN THE LIMITED CIRCUMSTANCES DESCRIBED IN THE TRUST AGREEMENT AND NO TRANSFER OF THIS TRUST PREFERRED SECURITY (OTHER THAN A TRANSFER OF THIS SECURITY AS A WHOLE 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) MAY BE REGISTERED EXCEPT IN LIMITED CIRCUMSTANCES. UNLESS THIS TRUST PREFERRED SECURITY CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITARY TO VIRGINIA CAPITAL TRUST II OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY TRUST PREFERRED SECURITY CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR SUCH OTHER NAME AS REGISTERED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITARY (AND ANY PAYMENT HEREON IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITARY), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.] CERTIFICATE NO.___________ NUMBER OF TRUST PREFERRED SECURITIES:___________ CUSIP NO._________________ CERTIFICATE EVIDENCING __% TRUST PREFERRED SECURITIES OF VIRGINIA POWERCAPITAL TRUST II % TRUST PREFERRED SECURITIES (LIQUIDATION AMOUNT $__ PER TRUST PREFERRED SECURITY) FULLY AND UNCONDITIONALLY GUARANTEED BY VIRGINIA ELECTRIC AND POWER COMPANY. VIRGINIA POWER CAPITAL TRUST II, a statutory business trust created under the laws of the State of Delaware (the "Trust"), hereby certifies that __________ (the "Holder") is the registered owner of _____ Trust Preferred Securities of the Trust representing undivided beneficial ownership interests in the assets of the Trust designated the "__% Trust Preferred Security" (liquidation amount $__ per Trust Preferred Security) (the "Trust Preferred 65 Securities"). The Trust Preferred Securities are transferable on the register of the Trust, in person or by a duly authorized attorney, upon surrender of this certificate duly endorsed and in proper form for transfer as provided in the Trust Agreement (as defined below). The designation, rights, privileges, restrictions, preferences and other terms and provisions of the Trust Preferred Securities represented hereby are issued and shall in all respects be subject to the provisions of the Amended and Restated Trust Agreement of the Trust, dated as of , ____, as the same may be amended from time to time (the "Trust Agreement"), by and among VIRGINIA ELECTRIC AND POWER COMPANY, _____________, ________________, and ________________, as Administrative Trustees, The Chase Manhattan Bank, as Property Trustee, Chase Manhattan Bank Delaware, as Delaware Trustee and the Holders. Capitalized terms used herein but not defined shall have the meaning given them in the Trust Agreement. The Holder is entitled to the benefits of the Guarantee to the extent described therein. The Sponsor will provide a copy of the Trust Agreement, the Guarantee and the Indenture to a Holder without charge upon written request to the Sponsor at its principal place of business. Upon receipt of this certificate, the Holder is bound by the Trust Agreement and is entitled to the benefits thereunder. By acceptance, the Holder agrees to treat, for United States federal income tax purposes, the Junior Subordinated Notes as indebtedness and the Trust Preferred Securities as evidence of undivided indirect beneficial ownership interests in the Junior Subordinated Notes. IN WITNESS WHEREOF, the Trust has executed this certificate this ______ day of , ____. VIRGINIA POWER CAPITAL TRUST II By:____________________________ Name: Title: Administrative Trustee This is one of the Trust Preferred Securities referred to in the within- mentioned Trust Agreement. THE CHASE MANHATTAN BANK, as Property Trustee By:_____________________________ Authorized Officer 66 EXHIBIT B TRANSFER OF THIS CERTIFICATE IS SUBJECT TO THE CONDITIONS SET FORTH IN THE TRUST AGREEMENT REFERRED TO BELOW. CERTIFICATE NO.______ NUMBER OF COMMON SECURITIES:______________ CERTIFICATE EVIDENCING COMMON SECURITIES OF VIRGINIA POWER CAPITAL TRUST II % COMMON SECURITIES (LIQUIDATION AMOUNT $__ PER COMMON SECURITY) VIRGINIA POWER CAPITAL TRUST II, a statutory business trust created under the laws of the State of Delaware (the "Trust"), hereby certifies that VIRGINIA ELECTRIC AND POWER COMPANY (the "Holder") is the registered owner of common securities of the Trust representing an undivided beneficial ownership interest in the assets of the Trust designated the "_____% Common Securities" (liquidation amount $__ per Common Security) (the "Common Securities"). The Common Securities are not transferable and any attempted transfer thereof shall be void except as permitted by applicable law and by Section 7.9(b)(ii) of the Trust Agreement (as defined below). The designation, rights, privileges, restrictions, preferences and other terms and provisions of the Common Securities represented hereby are issued and shall in all respects be subject to the provisions of the Amended and Restated Trust Agreement of the Trust, dated as of ____________ ___, ____ (as the same may be amended from time to time, the "Trust Agreement"), by and among VIRGINIA ELECTRIC AND POWER COMPANY, as Sponsor, ______________, _______________ and _______________, as Administrative Trustees, and, The Chase Manhattan Bank, as Property Trustee, Chase Manhattan Bank Delaware, as Delaware Trustee, and the Holders. The Holder is entitled to the benefits of the Guarantee to the extent described therein. Capitalized terms used herein but not defined shall have the meaning given them in the Trust Agreement. The Sponsor will provide a copy of the Trust Agreement, the Guarantee and the Indenture to the Holder without charge upon written request to the Sponsor at its principal place of business. Upon receipt of this certificate, the Holder is bound by the Trust Agreement and is entitled to the benefits thereunder. By acceptance, the Holder agrees to treat, for United States federal income tax purposes, the Junior Subordinated Notes as indebtedness and the Common Securities as evidence of an undivided indirect beneficial ownership interest in the Junior Subordinated Notes. IN WITNESS WHEREOF, the Trust has executed this certificate this ____ day of , ____. VIRGINIA POWER CAPITAL TRUST II By:________________________________ Name: Title: Administrative Trustee 67 EX-4.XIV 14 0014.txt AGREEMENT AS TO EXPENSES AND LIABILITIES EXHIBIT 4(xiv) AGREEMENT AS TO EXPENSES AND LIABILITIES AGREEMENT dated as of _______, 2000 between VIRGINIA ELECTRIC AND POWER COMPANY, a Virginia corporation ("Virginia Power"), and VIRGINIA POWER CAPITAL TRUST II, a Delaware business trust (the "Trust"). WHEREAS, the Trust intends to issue its ___% Common Securities (the "Common Securities") to, and purchase ___% Junior Subordinated Notes (the "Junior Subordinated Notes") from, Virginia Power, and to issue and sell its ___% Trust Preferred Securities (the "Trust Preferred Securities") with such powers, preferences and special rights and restrictions as are set forth in the Amended and Restated Trust Agreement of the Trust dated as of ________, 2000, as the same may be amended from time to time (the "Trust Agreement"); WHEREAS, Virginia Power will directly or indirectly own all of the Common Securities of the Trust and will issue the Junior Subordinated Notes; NOW, THEREFORE, in consideration of the purchase by each holder of the Trust Preferred Securities, which purchase Virginia Power hereby agrees shall benefit Virginia Power and which purchase Virginia Power acknowledges will be made in reliance upon the execution and delivery of this Agreement, Virginia Power and the Trust hereby agree as follows: ARTICLE I GUARANTEE BY VIRGINIA POWER 1.1 Guarantee by Virginia Power. Subject to the terms and conditions hereof, Virginia Power hereby irrevocably and unconditionally guarantees to each person or entity to whom the Trust is now or hereafter becomes indebted or liable (the "Beneficiaries") the full payment, when and as due, of any and all Obligations (as hereinafter defined) to such Beneficiaries. As used herein, "Obligations" means any costs, expenses or liabilities of the Trust, other than obligations of the Trust to pay to holders of any Trust Preferred Securities the amounts due such holders pursuant to the terms of the Trust Preferred Securities. This Agreement is intended to be for the benefit of, and to be enforceable by, all such Beneficiaries, whether or not such Beneficiaries have received notice hereof. 1.2 Terms of Agreement. This Agreement shall terminate and be of no further force and effect upon the later of (a) the date on which full payment has been made of all amounts payable to all holders of all the Trust Preferred Securities (whether upon redemption, liquidation, exchange or otherwise) and (b) the date on which there are no Beneficiaries remaining; provided, however, that this Agreement shall continue to be effective or shall be reinstated, as the case may be, if at any time any holder of Trust Preferred Securities or any Beneficiary must restore payment of any sums paid under the Trust Preferred Securities, under any Obligation, under the Trust Preferred Securities Guarantee Agreement dated the date hereof by Virginia Power and The Chase Manhattan Bank, as guarantee trustee, or under this Agreement for any reason whatsoever. This Agreement is continuing, irrevocable, unconditional and absolute. 1.3 Waiver of Notice. Virginia Power hereby waives notice of acceptance of this Agreement and of any Obligation to which it applies or may apply, and Virginia Power hereby waives presentment, demand for payment, protest, notice of nonpayment, notice of dishonor, notice of redemption and all other notices and demands. 1.4 No Impairment. The obligations, covenants, agreements and duties of Virginia Power under this Agreement shall in no way be affected or impaired by reason of the happening from time to time of any of the following: (a) the extension of time for the payment by the Trust of all or any portion of the Obligations or for the performance of any other obligation under, arising out of, or in connection with, the Obligations; (b) any failure, omission, delay or lack of diligence on the part of the Beneficiaries to enforce, assert or exercise any right, privilege, power or remedy conferred on the Beneficiaries with respect to the Obligations or any action on the part of the Trust granting indulgence or extension of any kind; or (c) the voluntary or involuntary liquidation, dissolution, sale of any collateral, receivership, insolvency, bankruptcy, assignment for the benefit of creditors, reorganization, arrangement, composition or readjustment of debt of, or other similar proceedings affecting, the Trust or any of the assets of the Trust. There shall be no obligation of the Beneficiaries to give notice to, or obtain the consent of, Virginia Power with respect to the happening of any of the foregoing. 1.5 Enforcement. A Beneficiary may enforce this Agreement directly against Virginia Power, and Virginia Power waives any right or remedy to require that any action be brought against the Trust or any other person or entity before proceeding against Virginia Power. 1.6 Subrogation. Virginia Power shall be subrogated to all rights (if any) of the Trust in respect of any amounts paid to the Beneficiaries by Virginia Power under this Agreement; provided, however, that Virginia Power shall not (except to the extent required by mandatory provisions of law) be entitled to enforce or exercise any rights which it may acquire by way of subrogation or any indemnity, reimbursement or other agreement, in all cases as a result of payment under this Agreement, if, at the time of any such payment, any amounts are due and unpaid under this Agreement. ARTICLE II BINDING EFFECT 2.1 Binding Effect. All guarantees and agreements contained in this Agreement shall bind the successors, assigns, receivers, trustees and representatives of Virginia Power and shall inure to the benefit of the Beneficiaries. 2.2 Amendment. So long as there remains any Beneficiary or any Trust Preferred Securities of any series are outstanding, this Agreement shall not be modified or amended in any manner adverse to such Beneficiary or to the holders of the Trust Preferred Securities. 2.3 Notices. Any notice, request or other communication required or permitted to be given hereunder shall be given in writing by delivering the same by personal delivery, by facsimile transmission or by first-class mail, addressed as follows (and if so given, shall be deemed given when so delivered, upon receipt of confirmation if by facsimile, or three days after mailed if by first-class mail): If to the Trust to: Virginia Power Capital Trust II c/o Virginia Electric and Power Company One James River Plaza 701 East Cary Street Richmond, VA 23219 Attention: Treasurer [Telecopy No.: (804)___-____] with a copy to: Virginia Electric and Power Company One James River Plaza 701 East Cary Street Richmond, VA 23219 Attention: Treasurer [Telecopy No.: (804) ___-____] 2.4 Governing Law. This Agreement shall be governed by and construed and interpreted in accordance with the laws of the Commonwealth of Virginia (without regard to conflict of laws principles). THIS AGREEMENT is executed as of the day and year first above written. VIRGINIA ELECTRIC AND POWER COMPANY By: ___________________________________ Name: Title: VIRGINIA POWER CAPITAL TRUST II By: ___________________________________ as Administrative Trustee EX-5.I 15 0015.txt EXHIBIT 5(I) EXHIBIT 5(i) [LETTERHEAD OF MCGUIRE, WOODS, BATTLE & BOOTHE LLP] June 1, 2000 Board of Directors Virginia Electric and Power Company 701 East Cary Street Richmond, Virginia 23219 Ladies and Gentlemen: Reference is made to your Registration Statement on Form S-3 being filed with the Securities and Exchange Commission (the Registration Statement) in connection with the registration of up to U.S. $1,500,000,000 aggregate principal amount of certain Mortgage Bonds, Senior Debt Securities, Junior Subordinated Notes, Trust Preferred Securities and Related Guarantee, Preferred Stock, and Agreement Regarding Expenses and Liabilities (collectively, the Securities) under the Securities Act of 1933, as amended (the Securities Act). In connection with the offering of the Securities, you have requested our opinion with respect to the matters set forth herein. In connection with the delivery of this opinion, we have examined originals or copies of the Restated Articles of Incorporation of the Company, as amended, the Bylaws of the Company, the Registration Statement and the exhibits thereto, certain resolutions adopted or to be adopted by the Board of Directors, an order (the "Order") issued on May 26, 2000 in Case No. PUF000016 by the State Corporation Commission of the Commonwealth of Virginia (Virginia Commission) authorizing various financing transactions and other matters, the forms of certificates representing the Securities and such other records, agreements, instruments, certificates and other documents of public officials, the Company and its officers and representatives, and have made such inquiries of the Company and its officers and representatives, as we have deemed necessary or appropriate in connection with the opinions set forth herein. We are familiar with the proceedings heretofore taken, and with the additional proceedings proposed to be taken, by the Company in connection with the authorization, registration, issuance and sale of the Securities. With respect to certain factual matters, we have relied upon representations from, or certificates of, officers of the Company. In making such examination and rendering the opinions set forth below, we have assumed without verification the genuineness of all signatures, the authenticity of all documents submitted to us as originals, the authenticity of the originals of such documents submitted to us as certified copies, the conformity to originals of all documents submitted to us as copies, the authenticity of the originals of such latter documents, that all documents submitted to us as certified copies are true and correct copies of such originals and the legal capacity of all individuals executing such documents. Based on such examination and review, and subject to the foregoing, we are of the opinion that 1. The Company is a corporation duly organized and validly existing under the laws of the Commonwealth of Virginia, and has the corporate power to conduct its business as now conducted and to issue the Securities of which the Company is the issuer. 2. When the Registration Statement, as it may be amended, has become effective under the Securities Act, and any applicable state securities or Blue Sky laws have been complied with, and upon issuance, delivery and payment therefore in the manner contemplated by the Registration Statement, the Securities of which the Company is the issuer will be validly issued, fully paid and non-assessable and, to the extent that the Securities are debt securities of the Company, they will be valid and binding obligations of the Company. This opinion is limited to the laws of the United States of America, the Commonwealth of Virginia and the State of New York, and we have not considered, and we express no opinion as to, the laws of any other jurisdiction. We consent to the inclusion of this opinion as an exhibit to the Registration Statement and to the statements made with regard to our firm under the caption "EXPERTS" appearing in the prospectus that is a part of the Registration Statement, and in any supplements thereto. In giving such consent, we do not hereby admit that we are in the category of persons whose consent is required under Section 7 of the Securities Act of 1933. Very truly yours, McGuire, Woods, Battle & Boothe, LLP EX-5.II 16 0016.txt EXHIBIT 5(II) EXHIBIT 5(ii) [LETTERHEAD OF RICHARDS, LAYTON & FINGER] June 2, 2000 Virginia Electric and Power Company 701 East Cary Street Richmond, Virginia 23219 Re: Virginia Power Capital Trust II ------------------------------- Ladies and Gentlemen: We have acted as special Delaware counsel for Virginia Power Capital Trust II, a Delaware business trust (the "Trust") in connection with the matters set forth herein. At your request, this opinion is being furnished to you. For purposes of giving the opinions hereinafter set forth, our examination of documents has been limited to the examination of originals or copies of the following: (a) The Certificate of Trust of the Trust, as filed with the office of the Secretary of State of the State of Delaware (the "Secretary of State") on May 26, 2000; (b) The Trust Agreement of the Trust, dated as of May 26, 2000, among Virginia Electric and Power Company, a Virginia corporation (the "Company") and the trustees named therein; (c) The Registration Statement (the "Registration Statement") on Form S-3, including a preliminary prospectus (the "Prospectus"), relating to the Trust Preferred Securities of the Trust representing preferred beneficial interests in the Trust (each, a "Preferred Security" and collectively, the "Preferred Securities"), to be filed by the Company and the Trust with the Securities and Exchange Commission on or about June 2, 2000. (d) A form of Amended and Restated Trust Agreement for the Trust, to be entered into between the Company, the trustees of the Trust named therein, and the holders, from time to time, of the undivided beneficial interests in the assets of such Trust (including the Exhibits thereto) (the "Trust Agreement"), to be attached as an exhibit to the Registration Statement; and (e) A Certificate of Good Standing for the Trust, dated June 1, 2000, obtained from the Secretary of State. Initially capitalized terms used herein and not otherwise defined are used as defined in the Trust Agreement. For purposes of this opinion, we have not reviewed any documents other than the documents listed in paragraphs (a) through (e) above. In particular, we have not reviewed any document (other than the documents listed in paragraphs (a) through (e) above) that is referred to in or incorporated by reference into the documents reviewed by us. We have assumed that there exists no provision in any document that we have not reviewed that is inconsistent with the opinions stated herein. We have conducted no independent factual investigation of our own but rather have relied solely upon the foregoing documents, the statements and information set forth therein and the additional matters recited or assumed herein, all of which we have assumed to be true, complete and accurate in all material respects. With respect to all documents examined by us, we have assumed (i) the authenticity of all documents submitted to us as authentic originals, (ii) the conformity with the originals of all documents submitted to us as copies or forms, and (iii) the genuineness of all signatures. For purposes of this opinion, we have assumed (i) that the Trust Agreement will constitute the entire agreement among the parties thereto with respect to the subject matter thereof, including with respect to the creation, operation and termination of the applicable Trust, and that the Trust Agreement and the Certificate of Trust will be in full force and effect and will not be amended, (ii) except to the extent provided in paragraph 1 below, the due organization or due formation, as the case may be, and valid existence in good standing of each party to the documents examined by us under the laws of the jurisdiction governing its organization or formation, (iii) the legal capacity of natural persons who are parties to the documents examined by us, (iv) that each of the parties to the documents examined by us has the power and authority to execute and deliver, and to perform its obligations under, such documents, (v) the due authorization, execution and delivery by all parties thereto of all documents examined by us, (vi) the receipt by each Person to whom a Preferred Security is to be issued by the Trust (collectively, the "Preferred Security Holders") of a Preferred Security Certificate for such Preferred Security and the payment for such Preferred Security, in accordance with the Trust Agreement and the Virginia Electric and Power Company June __, 2000 Page 3 Registration Statement, and (vii) that the Preferred Securities are authenticated, issued and sold to the Preferred Security Holders in accordance with the Trust Agreement and the Registration Statement. We have not participated in the preparation of the Registration Statement or the Prospectus and assume no responsibility for their contents. This opinion is limited to the laws of the State of Delaware (excluding the securities laws of the State of Delaware), and we have not considered and express no opinion on the laws of any other jurisdiction, including federal laws and rules and regulations relating thereto. Our opinions are rendered only with respect to Delaware laws and rules, regulations and orders thereunder which are currently in effect. Based upon the foregoing, and upon our examination of such questions of law and statutes of the State of Delaware as we have considered necessary or appropriate, and subject to the assumptions, qualifications, limitations and exceptions set forth herein, we are of the opinion that: 1. The Trust has been duly created and is validly existing in good standing as a business trust under the Business Trust Act. 2. The Preferred Securities of the Trust will represent valid and, subject to the qualifications set forth in paragraph 3 below, fully paid and nonassessable beneficial interests in the assets of the Trust. 3. The Preferred Security Holders, as beneficial owners of the Trust, will be entitled to the same limitation of personal liability extended to stockholders of private corporations for profit organized under the General Corporation Law of the State of Delaware. We note that the Preferred Security Holders may be obligated to make payments as set forth in the Trust Agreement. We consent to the filing of this opinion with the Securities and Exchange Commission as an exhibit to the Registration Statement. We hereby consent to the use of our name under the heading "Legal Opinions" in the Prospectus. In giving the foregoing consents, we do not thereby admit that we come within the category of persons whose consent is required under Section 7 of the Securities Act of 1933, as amended, or the rules and regulations of the Securities and Exchange Commission thereunder. Very truly yours, EAM/wrm /s/ Richards, Layton & Finger, PA EX-12 17 0017.txt RATIO OF EARNINGS TO FIXED CHARGES EXHIBIT 12 VIRGINIA ELECTRIC AND POWER COMPANY COMPUTATION OF RATIO OF EARNINGS TO FIXED CHARGES (thousands of dollars)
Dec-95 Dec-96 Dec-97 Dec-98 Dec-99 Mar-20000 ------ ------ ------ ------ ------ --------- Net Income $432,844 $457,304 $469,114 $229,873 $484,715 $500,160 Add: Income Taxes 228,785 243,993 249,293 157,298 258,033 264,298 ------------------------------------------------------------------------------------------ Total Pretax Net Income $661,629 $701,297 $718,406 $387,171 $742,748 $764,458 ========================================================================================== Fixed Charges: Interest on Long-Term Debt 302,618 287,928 274,850 308,200 279,080 274,923 Other Interest 19,998 22,380 30,703 * Pfd distribution of Affiliate-Gross 3,653 10,867 10,868 10,868 10,868 10,868 Estimated Interest Factor of Rents Charged to Operating Expenses, Clearing and Other Accounts 6,475 6,291 8,595 6,389 6,857 6,601 ------------------------------------------------------------------------------------------ Total Fixed Charges $332,744 $327,466 $325,015 $325,457 $296,805 $292,391 ========================================================================================== ------------------------------------------------------------------------------------------ Earnings as Designed $994,373 $1,028,764 $1,043,421 $712,627 $1,039,553 $1,056,849 ========================================================================================== Ratio of Earnings to Fixed Charges 2.99 3.14 3.21 2.19 3.50 3.61 ==========================================================================================
* beginning in 1998, Other Interest is included in the line item, Interest on long-Term Debt. EX-12.I 18 0018.txt RATIO-EARNINGS TO FIXED CHARGES & PREFERRED STOCK EXHIBIT 12(i) VIRGINIA ELECTRIC AND POWER COMPANY COMPUTATION OF RATIO OF EARNINGS TO FIXED CHARGES AND PREFERRED STOCK DIVIDENDS (thousands of dollars)
Dec-95 Dec-96 Dec-97 Dec-98 Dec-99 Dec-2000 ------ ------ ------ ------ ------ -------- Net Income 432,844 457,304 469,114 229,873 484,715 500,160 Add: Income Taxes 228,785 243,993 249,293 157,298 258,033 264,298 --------------------------------------------------------------------------------------------- Total Pretax Net Income $661,629 $701,297 $718,406 $387,171 $742,748 $764,458 ============================================================================================= Fixed Charges: Interest on Long-Term Debt 302,618 287,928 274,850 308,200 279,080 274,923 Other Interest 19,998 22,380 30,703 * Pfd Distribution of Affiliate-Gross 3,653 10,867 10,868 10,868 10,868 10,868 Estimated Interest Factor of Rents Charged to Op- erating Expenses, Clear- ing & Other Accounts 6,475 6,291 8,595 6,389 6,857 6,601 --------------------------------------------------------------------------------------------- Total Fixed Charges $332,744 $327,466 $325,015 $325,457 $296,805 $292,391 --------------------------------------------------------------------------------------------- Earnings as Defined $994,373 $1,028,764 $1,043,421 $712,627 $1,039,553 $1,056,849 ============================================================================================= Ratio of Pretax Income to Net Income 1.53 1.53 1.53 1.68 1.53 1.53 Preferred Div. Req. 44,124 35,505 35,754 35,784 37,045 38,426 Portion Allowable as Deduction for Federal Income Taxes 374 374 374 374 374 374 --------------------------------------------------------------------------------------------- Difference 43,750 35,131 35,380 35,410 36,671 38,052 Times Pretax Ratio 66,875 53,875 54,181 59,640 56,193 58,160 Preferred Divd. Factor 67,249 54,249 54,555 60,014 56,566 58,534 Fixed Charges As Above 332,744 327,466 325,015 325,457 296,805 292,391 --------------------------------------------------------------------------------------------- Total Fixed Charges and Preferred Divd. Factor $399,993 $381,715 $379,570 $385,470 $353,371 $350,925 ============================================================================================= Ratio of Earnings to Fixed Charges and Preferred Stock Dividends 2.49 2.70 2.75 1.85 2.94 3.01 =============================================================================================
* beginning in 1998, Other Interest is included in the line item, Interest on Long-Term Debt EX-23.III 19 0019.txt EXHIBIT 23(III) EXHIBIT 23(iii) CONSENT OF JACKSON & KELLY PLLC We hereby consent to the statements made in respect to our firm under the caption "experts" appearing in the Registration on Form S-3 (and the prospectus included therein) of Virginia Electric and Power Company to be filed on or about June 2, 2000, with the Securities and Exchange Commission under the provisions of the Securities Act of 1933, as amended, for registration of up to $1,500,000,000 aggregate principal amount of its securities. In giving this consent, we do not admit that we are within the category of persons whose consent is required by Section 7 of the Securities Act or other rules and regulations of the Securities and Exchange Commission thereunder. /s/ JACKSON & KELLY PLLC EX-23.IV 20 0020.txt EXHIBIT 23(IV) EXHIBIT 23(iv) INDEPENDENT AUDITORS' CONSENT We consent to the incorporation by reference in this Registration Statement of Virginia Electric and Power Company on Form S-3 of our report dated January 28, 2000, appearing in the Annual Report on Form 10-K of Virginia Electric and Power Company for the year ended December 31, 1999 and to the reference to us under the heading "Experts" in the Prospectus, which is part of this Registration Statement. DELOITTE & TOUCHE LLP Richmond, Virginia June 1, 2000 EX-25.I 21 0021.txt SENIOR DEBT SECURITIES ------------------------------------------------------------------- EXHIBIT 25(i) SECURITIES AND EXCHANGE COMMISSION Washington, D. C. 20549 ------------------------- FORM T-1 STATEMENT OF ELIGIBILITY UNDER THE TRUST INDENTURE ACT OF 1939 OF A CORPORATION DESIGNATED TO ACT AS TRUSTEE ------------------------------------------- CHECK IF AN APPLICATION TO DETERMINE ELIGIBILITY OF A TRUSTEE PURSUANT TO SECTION 305(b)(2) ________ ---------------------------------------- THE CHASE MANHATTAN BANK (Exact name of trustee as specified in its charter) New York 13-4994650 (State of incorporation (I.R.S. employer if not a national bank) identification No.) 270 Park Avenue New York, New York 10017 (Address of principal executive offices) (Zip Code) William H. McDavid General Counsel 270 Park Avenue New York, New York 10017 Tel: (212) 270-2611 (Name, address and telephone number of agent for service) --------------------------------------------- Virginia Electric and Power Company (Exact name of obligor as specified in its charter) Virginia 54-418825 (State or other jurisdiction of (I.R.S. employer incorporation or organization) identification No.) One James River Plaza 701 East Cary Street Richmond, Virginia 23219 (Address of principal executive offices) (Zip Code) --------------------------------------------- Senior Notes (Title of the indenture securities) --------------------------------------------- GENERAL Item 1. General Information. Furnish the following information as to the trustee: (a) Name and address of each examining or supervising authority to which it is subject. New York State Banking Department, Suite 2310, 5 Empire State Plaza, Albany, New York 12223. Board of Governors of the Federal Reserve System, 20th and C Street, NW, Washington, D.C., 20551. Federal Reserve Bank of New York, District No. 2, 33 Liberty Street, New York, N.Y. 10045 Federal Deposit Insurance Corporation, 550 Seventeenth Street NW, Washington, D.C., 20429. (b) Whether it is authorized to exercise corporate trust powers. Yes. Item 2. Affiliations with the Obligor. If the obligor is an affiliate of the trustee, describe each such affiliation. None. - 2 - Item 16. List of Exhibits List below all exhibits filed as a part of this Statement of Eligibility. 1. A copy of the Articles of Association of the Trustee as now in effect, including the Organization Certificate and the Certificates of Amendment dated February 17, 1969, August 31, 1977, December 31, 1980, September 9, 1982, February 28, 1985, December 2, 1991 and July 10, 1996 (see Exhibit 1 to Form T-1 filed in connection with Registration Statement No. 333-06249, which is incorporated by reference). 2. A copy of the Certificate of Authority of the Trustee to Commence Business (see Exhibit 2 to Form T-1 filed in connection with Registration Statement No. 33-50010, which is incorporated by reference. On July 14, 1996, in connection with the merger of Chemical Bank and The Chase Manhattan Bank (National Association), Chemical Bank, the surviving corporation, was renamed The Chase Manhattan Bank). 3. None, authorization to exercise corporate trust powers being contained in the documents identified above as Exhibits 1 and 2. 4. A copy of the existing By-Laws of the Trustee (see Exhibit 4 to Form T-1 filed in connection with Registration Statement No. 333-76439, which is incorporated by reference). 5. Not applicable. 6. The consent of the Trustee required by Section 321(b) of the Act (see Exhibit 6 to Form T-1 filed in connection with Registration Statement No. 33-50010, which is incorporated by reference. On July 14, 1996, in connection with the merger of Chemical Bank and The Chase Manhattan Bank (National Association), Chemical Bank, the surviving corporation, was renamed The Chase Manhattan Bank). 7. A copy of the latest report of condition of the Trustee, published pursuant to law or the requirements of its supervising or examining authority. 8. Not applicable. 9. Not applicable. SIGNATURE Pursuant to the requirements of the Trust Indenture Act of 1939 the Trustee, The Chase Manhattan Bank, a corporation organized and existing under the laws of the State of New York, has duly caused this statement of eligibility to be signed on its behalf by the undersigned, thereunto duly authorized, all in the City of New York and State of New York, on the 2nd day of June, 2000. THE CHASE MANHATTAN BANK By /s/ N. Rodriguez -------------------------------------- N. Rodriguez Assistant Vice President Exhibit 7 to Form T-1 Bank Call Notice RESERVE DISTRICT NO. 2 CONSOLIDATED REPORT OF CONDITION OF The Chase Manhattan Bank of 270 Park Avenue, New York, New York 10017 and Foreign and Domestic Subsidiaries, a member of the Federal Reserve System, at the close of business December 31, 1999, in accordance with a call made by the Federal Reserve Bank of this District pursuant to the provisions of the Federal Reserve Act. Dollar Amounts ASSETS in Millions Cash and balances due from depository institutions: Noninterest-bearing balances and currency and coin ......................................... $ 13,271 Interest-bearing balances ................................. 30,165 Securities: Held to maturity securities .................................... 724 Available for sale securities .................................. 54,770 Federal funds sold and securities purchased under agreements to resell ...................................... 26,694 Loans and lease financing receivables: Loans and leases, net of unearned income .................. $132,814 Less: Allowance for loan and lease losses ................. 2,254 Less: Allocated transfer risk reserve ..................... 0 -------- Loans and leases, net of unearned income, allowance, and reserve .................................... 130,560 Trading Assets ................................................. 53,619 Premises and fixed assets (including capitalized leases) ................................................... 3,359 Other real estate owned ........................................ 29 Investments in unconsolidated subsidiaries and associated companies ...................................... 186 Customers' liability to this bank on acceptances outstanding ............................................... 608 Intangible assets .............................................. 3,659 Other assets ................................................... 14,554 -------- TOTAL ASSETS ................................................... $332,198 ======== - 4 - LIABILITIES Deposits In domestic offices ........................................ $ 102,421 Noninterest-bearing ........................................ $ 41,580 Interest-bearing ........................................... 60,841 In foreign offices, Edge and Agreement subsidiaries and IBF's ..................................... 108,233 Noninterest-bearing ............................................. $ 6,061 Interest-bearing ........................................... 102,172 Federal funds purchased and securities sold under agree- ments to repurchase ............................................. 47,425 Demand notes issued to the U.S. Treasury ........................ 100 Trading liabilities ............................................. 33,626 Other borrowed money (includes mortgage indebtedness and obligations under capitalized leases): With a remaining maturity of one year or less .............. 3,964 With a remaining maturity of more than one year through three years .................................... 14 With a remaining maturity of more than three years ......... 99 Bank's liability on acceptances executed and outstanding ........ 608 Subordinated notes and debentures ............................... 5,430 Other liabilities ............................................... 11,886 TOTAL LIABILITIES ............................................... 313,806 EQUITY CAPITAL Perpetual preferred stock and related surplus ................... 0 Common stock .................................................... 1,211 Surplus (exclude all surplus related to preferred stock) ....... 11,066 Undivided profits and capital reserves .......................... 7,376 Net unrealized holding gains (losses) on available-for-sale securities ................................ (1,277) Accumulated net gains (losses) on cash flow hedges .............. 0 Cumulative foreign currency translation adjustments ............. 16 TOTAL EQUITY CAPITAL ............................................ 18,392 --------- TOTAL LIABILITIES AND EQUITY CAPITAL ............................ $ 332,198 ========= I, Joseph L. Sclafani, E.V.P. & Controller of the above-named bank, do hereby declare that this Report of Condition has been prepared in conformance with the instructions issued by the appropriate Federal regulatory authority and is true to the best of my knowledge and belief. JOSEPH L. SCLAFANI We, the undersigned directors, attest to the correctness of this Report of Condition and declare that it has been examined by us, and to the best of our knowledge and belief has been prepared in conformance with the instructions issued by the appropriate Federal regulatory authority and is true and correct. WILLIAM B. HARRISON, JR. ) HELENE L. KAPLAN ) DIRECTORS HENRY B. SCHACHT ) -5- EX-25.II 22 0022.txt JUNIOR SUBORDINATED NOTES ------------------------------------------------------------------- EXHIBIT 25(ii) SECURITIES AND EXCHANGE COMMISSION Washington, D. C. 20549 ------------------------- FORM T-1 STATEMENT OF ELIGIBILITY UNDER THE TRUST INDENTURE ACT OF 1939 OF A CORPORATION DESIGNATED TO ACT AS TRUSTEE ------------------------------------------- CHECK IF AN APPLICATION TO DETERMINE ELIGIBILITY OF A TRUSTEE PURSUANT TO SECTION 305(b)(2) ________ ---------------------------------------- THE CHASE MANHATTAN BANK (Exact name of trustee as specified in its charter) New York 13-4994650 (State of incorporation (I.R.S. employer if not a national bank) identification No.) 270 Park Avenue New York, New York 10017 (Address of principal executive offices) (Zip Code) William H. McDavid General Counsel 270 Park Avenue New York, New York 10017 Tel: (212) 270-2611 (Name, address and telephone number of agent for service) --------------------------------------------- Virginia Electric and Power Company (Exact name of obligor as specified in its charter) Virginia 54-418825 (State or other jurisdiction of (I.R.S. employer incorporation or organization) identification No.) One James River Plaza 701 East Cary Street Richmond, Virginia 23219 (Address of principal executive offices) (Zip Code) --------------------------------------------- Junior Subordinated Notes (Title of the indenture securities) --------------------------------------------- GENERAL Item 1. General Information. Furnish the following information as to the trustee: (a) Name and address of each examining or supervising authority to which it is subject. New York State Banking Department, Suite 2310, 5 Empire State Plaza, Albany, New York 12223. Board of Governors of the Federal Reserve System, 20th and C Street, NW, Washington, D.C., 20551. Federal Reserve Bank of New York, District No. 2, 33 Liberty Street, New York, N.Y. 10045 Federal Deposit Insurance Corporation, 550 Seventeenth Street NW, Washington, D.C., 20429. (b) Whether it is authorized to exercise corporate trust powers. Yes. Item 2. Affiliations with the Obligor. If the obligor is an affiliate of the trustee, describe each such affiliation. None. - 2 - Item 16. List of Exhibits List below all exhibits filed as a part of this Statement of Eligibility. 1. A copy of the Articles of Association of the Trustee as now in effect, including the Organization Certificate and the Certificates of Amendment dated February 17, 1969, August 31, 1977, December 31, 1980, September 9, 1982, February 28, 1985, December 2, 1991 and July 10, 1996 (see Exhibit 1 to Form T-1 filed in connection with Registration Statement No. 333-06249, which is incorporated by reference). 2. A copy of the Certificate of Authority of the Trustee to Commence Business (see Exhibit 2 to Form T-1 filed in connection with Registration Statement No. 33-50010, which is incorporated by reference. On July 14, 1996, in connection with the merger of Chemical Bank and The Chase Manhattan Bank (National Association), Chemical Bank, the surviving corporation, was renamed The Chase Manhattan Bank). 3. None, authorization to exercise corporate trust powers being contained in the documents identified above as Exhibits 1 and 2. 4. A copy of the existing By-Laws of the Trustee (see Exhibit 4 to Form T-1 filed in connection with Registration Statement No. 333-76439, which is incorporated by reference). 5. Not applicable. 6. The consent of the Trustee required by Section 321(b) of the Act (see Exhibit 6 to Form T-1 filed in connection with Registration Statement No. 33-50010, which is incorporated by reference. On July 14, 1996, in connection with the merger of Chemical Bank and The Chase Manhattan Bank (National Association), Chemical Bank, the surviving corporation, was renamed The Chase Manhattan Bank). 7. A copy of the latest report of condition of the Trustee, published pursuant to law or the requirements of its supervising or examining authority. 8. Not applicable. 9. Not applicable. SIGNATURE Pursuant to the requirements of the Trust Indenture Act of 1939 the Trustee, The Chase Manhattan Bank, a corporation organized and existing under the laws of the State of New York, has duly caused this statement of eligibility to be signed on its behalf by the undersigned, thereunto duly authorized, all in the City of New York and State of New York, on the 2nd day of June, 2000. THE CHASE MANHATTAN BANK By /s/ N. Rodriguez ----------------------------------------- N. Rodriguez Assistant Vice President Exhibit 7 to Form T-1 Bank Call Notice RESERVE DISTRICT NO. 2 CONSOLIDATED REPORT OF CONDITION OF The Chase Manhattan Bank of 270 Park Avenue, New York, New York 10017 and Foreign and Domestic Subsidiaries, a member of the Federal Reserve System, at the close of business December 31, 1999, in accordance with a call made by the Federal Reserve Bank of this District pursuant to the provisions of the Federal Reserve Act. Dollar Amounts ASSETS in Millions Cash and balances due from depository institutions: Noninterest-bearing balances and currency and coin ......................................... $ 13,271 Interest-bearing balances ................................. 30,165 Securities: Held to maturity securities .................................... 724 Available for sale securities .................................. 54,770 Federal funds sold and securities purchased under agreements to resell ...................................... 26,694 Loans and lease financing receivables: Loans and leases, net of unearned income .................. $132,814 Less: Allowance for loan and lease losses ................. 2,254 Less: Allocated transfer risk reserve ..................... 0 -------- Loans and leases, net of unearned income, allowance, and reserve .................................... 130,560 Trading Assets ................................................. 53,619 Premises and fixed assets (including capitalized leases) ................................................... 3,359 Other real estate owned ........................................ 29 Investments in unconsolidated subsidiaries and associated companies ...................................... 186 Customers' liability to this bank on acceptances outstanding ............................................... 608 Intangible assets .............................................. 3,659 Other assets ................................................... 14,554 -------- TOTAL ASSETS ................................................... $332,198 ======== - 4 - LIABILITIES Deposits In domestic offices ........................................ $ 102,421 Noninterest-bearing ........................................ $ 41,580 Interest-bearing ........................................... 60,841 In foreign offices, Edge and Agreement subsidiaries and IBF's ..................................... 108,233 Noninterest-bearing ............................................. $ 6,061 Interest-bearing ........................................... 102,172 Federal funds purchased and securities sold under agreements to repurchase .................................................. 47,425 Demand notes issued to the U.S. Treasury ........................ 100 Trading liabilities ............................................. 33,626 Other borrowed money (includes mortgage indebtedness and obligations under capitalized leases): With a remaining maturity of one year or less .............. 3,964 With a remaining maturity of more than one year through three years .................................... 14 With a remaining maturity of more than three years ......... 99 Bank's liability on acceptances executed and outstanding ........ 608 Subordinated notes and debentures ............................... 5,430 Other liabilities ............................................... 11,886 TOTAL LIABILITIES ............................................... 313,806 EQUITY CAPITAL Perpetual preferred stock and related surplus ................... 0 Common stock .................................................... 1,211 Surplus (exclude all surplus related to preferred stock) ....... 11,066 Undivided profits and capital reserves .......................... 7,376 Net unrealized holding gains (losses) on available-for-sale securities ................................ (1,277) Accumulated net gains (losses) on cash flow hedges .............. 0 Cumulative foreign currency translation adjustments ............. 16 TOTAL EQUITY CAPITAL ............................................ 18,392 --------- TOTAL LIABILITIES AND EQUITY CAPITAL ............................ $ 332,198 ========= I, Joseph L. Sclafani, E.V.P. & Controller of the above-named bank, do hereby declare that this Report of Condition has been prepared in conformance with the instructions issued by the appropriate Federal regulatory authority and is true to the best of my knowledge and belief. JOSEPH L. SCLAFANI We, the undersigned directors, attest to the correctness of this Report of Condition and declare that it has been examined by us, and to the best of our knowledge and belief has been prepared in conformance with the instructions issued by the appropriate Federal regulatory authority and is true and correct. WILLIAM B. HARRISON, JR. ) HELENE L. KAPLAN ) DIRECTORS HENRY B. SCHACHT ) -5- EX-25.III 23 0023.txt VA POWER CAPITAL TRUST II ------------------------------------------------------------------- EXHIBIT 25(iii) SECURITIES AND EXCHANGE COMMISSION Washington, D. C. 20549 ------------------------- FORM T-1 STATEMENT OF ELIGIBILITY UNDER THE TRUST INDENTURE ACT OF 1939 OF A CORPORATION DESIGNATED TO ACT AS TRUSTEE ------------------------------------------- CHECK IF AN APPLICATION TO DETERMINE ELIGIBILITY OF A TRUSTEE PURSUANT TO SECTION 305(b)(2) ________ ---------------------------------------- THE CHASE MANHATTAN BANK (Exact name of trustee as specified in its charter) New York 13-4994650 (State of incorporation (I.R.S. employer if not a national bank) identification No.) 270 Park Avenue New York, New York 10017 (Address of principal executive offices) (Zip Code) William H. McDavid General Counsel 270 Park Avenue New York, New York 10017 Tel: (212) 270-2611 (Name, address and telephone number of agent for service) --------------------------------------------- Virginia Electric and Power Company (Exact name of obligor as specified in its charter) Delaware Applied For (State or other jurisdiction of (I.R.S. employer incorporation or organization) identification No.) One James River Plaza 701 East Cary Street Richmond, Virginia 23219 (Address of principal executive offices) (Zip Code) ------------------------------------------------- Preferred Securities Guarantee (Virginia Power Capital Trust II) (Title of the indenture securities) ------------------------------------------------------------------- GENERAL Item 1. General Information. Furnish the following information as to the trustee: (a) Name and address of each examining or supervising authority to which it is subject. New York State Banking Department, Suite 2310, 5 Empire State Plaza, Albany, New York 12223. Board of Governors of the Federal Reserve System, 20th and C Street, NW, Washington, D.C., 20551. Federal Reserve Bank of New York, District No. 2, 33 Liberty Street, New York, N.Y. 10045 Federal Deposit Insurance Corporation, 550 Seventeenth Street NW, Washington, D.C., 20429. (b) Whether it is authorized to exercise corporate trust powers. Yes. Item 2. Affiliations with the Obligor. If the obligor is an affiliate of the trustee, describe each such affiliation. None. - 2 - Item 16. List of Exhibits List below all exhibits filed as a part of this Statement of Eligibility. 1. A copy of the Articles of Association of the Trustee as now in effect, including the Organization Certificate and the Certificates of Amendment dated February 17, 1969, August 31, 1977, December 31, 1980, September 9, 1982, February 28, 1985, December 2, 1991 and July 10, 1996 (see Exhibit 1 to Form T-1 filed in connection with Registration Statement No. 333-06249, which is incorporated by reference). 2. A copy of the Certificate of Authority of the Trustee to Commence Business (see Exhibit 2 to Form T-1 filed in connection with Registration Statement No. 33-50010, which is incorporated by reference. On July 14, 1996, in connection with the merger of Chemical Bank and The Chase Manhattan Bank (National Association), Chemical Bank, the surviving corporation, was renamed The Chase Manhattan Bank). 3. None, authorization to exercise corporate trust powers being contained in the documents identified above as Exhibits 1 and 2. 4. A copy of the existing By-Laws of the Trustee (see Exhibit 4 to Form T-1 filed in connection with Registration Statement No. 333-76439, which is incorporated by reference). 5. Not applicable. 6. The consent of the Trustee required by Section 321(b) of the Act (see Exhibit 6 to Form T-1 filed in connection with Registration Statement No. 33-50010, which is incorporated by reference. On July 14, 1996, in connection with the merger of Chemical Bank and The Chase Manhattan Bank (National Association), Chemical Bank, the surviving corporation, was renamed The Chase Manhattan Bank). 7. A copy of the latest report of condition of the Trustee, published pursuant to law or the requirements of its supervising or examining authority. 8. Not applicable. 9. Not applicable. SIGNATURE Pursuant to the requirements of the Trust Indenture Act of 1939 the Trustee, The Chase Manhattan Bank, a corporation organized and existing under the laws of the State of New York, has duly caused this statement of eligibility to be signed on its behalf by the undersigned, thereunto duly authorized, all in the City of New York and State of New York, on the 2nd day of June, 2000. THE CHASE MANHATTAN BANK By /s/ N. Rodriguez -------------------------------------- N. Rodriguez Assistant Vice President Exhibit 7 to Form T-1 Bank Call Notice RESERVE DISTRICT NO. 2 CONSOLIDATED REPORT OF CONDITION OF The Chase Manhattan Bank of 270 Park Avenue, New York, New York 10017 and Foreign and Domestic Subsidiaries, a member of the Federal Reserve System, at the close of business December 31, 1999, in accordance with a call made by the Federal Reserve Bank of this District pursuant to the provisions of the Federal Reserve Act. Dollar Amounts ASSETS in Millions Cash and balances due from depository institutions: Noninterest-bearing balances and currency and coin ......................................... $ 13,271 Interest-bearing balances ................................. 30,165 Securities: Held to maturity securities .................................... 724 Available for sale securities .................................. 54,770 Federal funds sold and securities purchased under agreements to resell ...................................... 26,694 Loans and lease financing receivables: Loans and leases, net of unearned income .................. $132,814 Less: Allowance for loan and lease losses ................. 2,254 Less: Allocated transfer risk reserve ..................... 0 -------- Loans and leases, net of unearned income, allowance, and reserve .................................... 130,560 Trading Assets ................................................. 53,619 Premises and fixed assets (including capitalized leases) ................................................... 3,359 Other real estate owned ........................................ 29 Investments in unconsolidated subsidiaries and associated companies ...................................... 186 Customers' liability to this bank on acceptances outstanding ............................................... 608 Intangible assets .............................................. 3,659 Other assets ................................................... 14,554 -------- TOTAL ASSETS ................................................... $332,198 ======== - 4 - LIABILITIES Deposits In domestic offices ........................................ $ 102,421 Noninterest-bearing ........................................ $ 41,580 Interest-bearing ........................................... 60,841 In foreign offices, Edge and Agreement subsidiaries and IBF's ..................................... 108,233 Noninterest-bearing ............................................. $ 6,061 Interest-bearing ........................................... 102,172 Federal funds purchased and securities sold under agreements to repurchase .................................................. 47,425 Demand notes issued to the U.S. Treasury ........................ 100 Trading liabilities ............................................. 33,626 Other borrowed money (includes mortgage indebtedness and obligations under capitalized leases): With a remaining maturity of one year or less .............. 3,964 With a remaining maturity of more than one year through three years .................................... 14 With a remaining maturity of more than three years ......... 99 Bank's liability on acceptances executed and outstanding ........ 608 Subordinated notes and debentures ............................... 5,430 Other liabilities ............................................... 11,886 TOTAL LIABILITIES ............................................... 313,806 EQUITY CAPITAL Perpetual preferred stock and related surplus ................... 0 Common stock .................................................... 1,211 Surplus (exclude all surplus related to preferred stock) ....... 11,066 Undivided profits and capital reserves .......................... 7,376 Net unrealized holding gains (losses) on available-for-sale securities ................................ (1,277) Accumulated net gains (losses) on cash flow hedges .............. 0 Cumulative foreign currency translation adjustments ............. 16 TOTAL EQUITY CAPITAL ............................................ 18,392 --------- TOTAL LIABILITIES AND EQUITY CAPITAL ............................ $ 332,198 ========= I, Joseph L. Sclafani, E.V.P. & Controller of the above-named bank, do hereby declare that this Report of Condition has been prepared in conformance with the instructions issued by the appropriate Federal regulatory authority and is true to the best of my knowledge and belief. JOSEPH L. SCLAFANI We, the undersigned directors, attest to the correctness of this Report of Condition and declare that it has been examined by us, and to the best of our knowledge and belief has been prepared in conformance with the instructions issued by the appropriate Federal regulatory authority and is true and correct. WILLIAM B. HARRISON, JR. ) HELENE L. KAPLAN ) DIRECTORS HENRY B. SCHACHT ) -5- EX-25.IV 24 0024.txt VA POWER CAPITAL TRUST II PREFERRED SECURITIES ------------------------------------------------------------------- EXHIBIT 25(iv) SECURITIES AND EXCHANGE COMMISSION Washington, D. C. 20549 ------------------------- FORM T-1 STATEMENT OF ELIGIBILITY UNDER THE TRUST INDENTURE ACT OF 1939 OF A CORPORATION DESIGNATED TO ACT AS TRUSTEE ------------------------------------------- CHECK IF AN APPLICATION TO DETERMINE ELIGIBILITY OF A TRUSTEE PURSUANT TO SECTION 305(b)(2) ________ ---------------------------------------- THE CHASE MANHATTAN BANK (Exact name of trustee as specified in its charter) New York 13-4994650 (State of incorporation (I.R.S. employer if not a national bank) identification No.) 270 Park Avenue New York, New York 10017 (Address of principal executive offices) (Zip Code) William H. McDavid General Counsel 270 Park Avenue New York, New York 10017 Tel: (212) 270-2611 (Name, address and telephone number of agent for service) --------------------------------------------- Virginia Power Capital Trust II (Exact name of obligor as specified in its charter) Delaware Applied For (State or other jurisdiction of (I.R.S. employer incorporation or organization) identification No.) One James River Plaza 701 East Cary Street Richmond, Virginia 23219 (Address of principal executive offices) (Zip Code) --------------------------------------------- Preferred Securities (Title of the indenture securities) --------------------------------------------- GENERAL Item 1. General Information. Furnish the following information as to the trustee: (a) Name and address of each examining or supervising authority to which it is subject. New York State Banking Department, Suite 2310, 5 Empire State Plaza, Albany, New York 12223. Board of Governors of the Federal Reserve System, 20th and C Street, NW, Washington, D.C., 20551. Federal Reserve Bank of New York, District No. 2, 33 Liberty Street, New York, N.Y. 10045 Federal Deposit Insurance Corporation, 550 Seventeenth Street NW, Washington, D.C., 20429. (b) Whether it is authorized to exercise corporate trust powers. Yes. Item 2. Affiliations with the Obligor. If the obligor is an affiliate of the trustee, describe each such affiliation. None. - 2 - Item 16. List of Exhibits List below all exhibits filed as a part of this Statement of Eligibility. 1. A copy of the Articles of Association of the Trustee as now in effect, including the Organization Certificate and the Certificates of Amendment dated February 17, 1969, August 31, 1977, December 31, 1980, September 9, 1982, February 28, 1985, December 2, 1991 and July 10, 1996 (see Exhibit 1 to Form T-1 filed in connection with Registration Statement No. 333-06249, which is incorporated by reference). 2. A copy of the Certificate of Authority of the Trustee to Commence Business (see Exhibit 2 to Form T-1 filed in connection with Registration Statement No. 33-50010, which is incorporated by reference. On July 14, 1996, in connection with the merger of Chemical Bank and The Chase Manhattan Bank (National Association), Chemical Bank, the surviving corporation, was renamed The Chase Manhattan Bank). 3. None, authorization to exercise corporate trust powers being contained in the documents identified above as Exhibits 1 and 2. 4. A copy of the existing By-Laws of the Trustee (see Exhibit 4 to Form T-1 filed in connection with Registration Statement No. 333-76439, which is incorporated by reference). 5. Not applicable. 6. The consent of the Trustee required by Section 321(b) of the Act (see Exhibit 6 to Form T-1 filed in connection with Registration Statement No. 33-50010, which is incorporated by reference. On July 14, 1996, in connection with the merger of Chemical Bank and The Chase Manhattan Bank (National Association), Chemical Bank, the surviving corporation, was renamed The Chase Manhattan Bank). 7. A copy of the latest report of condition of the Trustee, published pursuant to law or the requirements of its supervising or examining authority. 8. Not applicable. 9. Not applicable. SIGNATURE Pursuant to the requirements of the Trust Indenture Act of 1939 the Trustee, The Chase Manhattan Bank, a corporation organized and existing under the laws of the State of New York, has duly caused this statement of eligibility to be signed on its behalf by the undersigned, thereunto duly authorized, all in the City of New York and State of New York, on the 2nd day of June, 2000. THE CHASE MANHATTAN BANK By /s/ N. Rodriguez -------------------------------------- N. Rodriguez Assistant Vice President Exhibit 7 to Form T-1 Bank Call Notice RESERVE DISTRICT NO. 2 CONSOLIDATED REPORT OF CONDITION OF The Chase Manhattan Bank of 270 Park Avenue, New York, New York 10017 and Foreign and Domestic Subsidiaries, a member of the Federal Reserve System, at the close of business December 31, 1999, in accordance with a call made by the Federal Reserve Bank of this District pursuant to the provisions of the Federal Reserve Act. Dollar Amounts ASSETS in Millions Cash and balances due from depository institutions: Noninterest-bearing balances and currency and coin ......................................... $ 13,271 Interest-bearing balances ................................. 30,165 Securities: Held to maturity securities .................................... 724 Available for sale securities .................................. 54,770 Federal funds sold and securities purchased under agreements to resell ...................................... 26,694 Loans and lease financing receivables: Loans and leases, net of unearned income .................. $132,814 Less: Allowance for loan and lease losses ................. 2,254 Less: Allocated transfer risk reserve ..................... 0 -------- Loans and leases, net of unearned income, allowance, and reserve .................................... 130,560 Trading Assets ................................................. 53,619 Premises and fixed assets (including capitalized leases) ................................................... 3,359 Other real estate owned ........................................ 29 Investments in unconsolidated subsidiaries and associated companies ...................................... 186 Customers' liability to this bank on acceptances outstanding ............................................... 608 Intangible assets .............................................. 3,659 Other assets ................................................... 14,554 -------- TOTAL ASSETS ................................................... $332,198 ======== - 4 - LIABILITIES Deposits In domestic offices ........................................ $ 102,421 Noninterest-bearing ........................................ $ 41,580 Interest-bearing ........................................... 60,841 In foreign offices, Edge and Agreement subsidiaries and IBF's ..................................... 108,233 Noninterest-bearing ............................................. $ 6,061 Interest-bearing ........................................... 102,172 Federal funds purchased and securities sold under agree- ments to repurchase ............................................. 47,425 Demand notes issued to the U.S. Treasury ........................ 100 Trading liabilities ............................................. 33,626 Other borrowed money (includes mortgage indebtedness and obligations under capitalized leases): With a remaining maturity of one year or less .............. 3,964 With a remaining maturity of more than one year through three years ................................. 14 With a remaining maturity of more than three years ....... 99 Bank's liability on acceptances executed and outstanding ........ 608 Subordinated notes and debentures ............................... 5,430 Other liabilities ............................................... 11,886 TOTAL LIABILITIES ............................................... 313,806 EQUITY CAPITAL Perpetual preferred stock and related surplus ................... 0 Common stock .................................................... 1,211 Surplus (exclude all surplus related to preferred stock) ....... 11,066 Undivided profits and capital reserves .......................... 7,376 Net unrealized holding gains (losses) on available-for-sale securities ................................ (1,277) Accumulated net gains (losses) on cash flow hedges .............. 0 Cumulative foreign currency translation adjustments ............. 16 TOTAL EQUITY CAPITAL ............................................ 18,392 --------- TOTAL LIABILITIES AND EQUITY CAPITAL ............................ $ 332,198 ========= I, Joseph L. Sclafani, E.V.P. & Controller of the above-named bank, do hereby declare that this Report of Condition has been prepared in conformance with the instructions issued by the appropriate Federal regulatory authority and is true to the best of my knowledge and belief. JOSEPH L. SCLAFANI We, the undersigned directors, attest to the correctness of this Report of Condition and declare that it has been examined by us, and to the best of our knowledge and belief has been prepared in conformance with the instructions issued by the appropriate Federal regulatory authority and is true and correct. WILLIAM B. HARRISON, JR. ) HELENE L. KAPLAN ) DIRECTORS HENRY B. SCHACHT ) -5- EX-25.V 25 0025.txt EXHIBIT 25(V) EXHIBIT 25(v) - -------------------------------------------------------------------------------- SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 ------------------------- FORM T-1 STATEMENT OF ELIGIBILITY UNDER THE TRUST INDENTURE ACT OF 1939 OF A CORPORATION DESIGNATED TO ACT AS TRUSTEE ------------------------------------------- CHECK IF AN APPLICATION TO DETERMINE ELIGIBILITY OF A TRUSTEE PURSUANT TO SECTION 305(b)(2) ________ ---------------------------------------- THE CHASE MANHATTAN BANK (Exact name of trustee as specified in its charter) New York 13-4994650 (State of incorporation (I.R.S. employer if not a national bank) identification No.) 270 Park Avenue New York, New York 10017 (Address of principal executive offices) (Zip Code) William H. McDavid General Counsel 270 Park Avenue New York, New York 10017 Tel: (212) 270-2611 (Name, address and telephone number of agent for service) -------------------------------------------- Virginia Electric and Power Company (Exact name of obligor as specified in its charter) Virginia 54-418825 (State or other jurisdiction of (I.R.S. employer incorporation or organization) identification No.) One James River Plaza 701 East Cary Street Richmond, Virginia 23219 (Address of principal executive offices) (Zip Code) --------------------------------------------- First and Refunding Mortgage Bonds - -------------------------------------------------------------------------------- GENERAL Item 1. General Information. Furnish the following information as to the trustee: (a) Name and address of each examining or supervising authority to which it is subject. New York State Banking Department, State House, Albany, New York 12110. Board of Governors of the Federal Reserve System, Washington, D.C., 20551 Federal Reserve Bank of New York, District No. 2, 33 Liberty Street, New York, N.Y. Federal Deposit Insurance Corporation, Washington, D.C., 20429. (b) Whether it is authorized to exercise corporate trust powers. Yes. Item 2. Affiliations with the Obligor. If the obligor is an affiliate of the trustee, describe each such affiliation. None. -2- Item 16. List of Exhibits List below all exhibits filed as a part of this Statement of Eligibility. 1. A copy of the Articles of Association of the Trustee as now in effect, including the Organization Certificate and the Certificates of Amendment dated February 17, 1969, August 31, 1977, December 31, 1980, September 9, 1982, February 28, 1985, December 2, 1991 and July 10, 1996 (see Exhibit 1 to Form T-1 filed in connection with Registration Statement No. 333-06249, which is incorporated by reference). 2. A copy of the Certificate of Authority of the Trustee to Commence Business (see Exhibit 2 to Form T-1 filed in connection with Registration Statement No. 33-50010, which is incorporated by reference. On July 14, 1996, in connection with the merger of Chemical Bank and The Chase Manhattan Bank (National Association), Chemical Bank, the surviving corporation, was renamed The Chase Manhattan Bank). 3. None, authorization to exercise corporate trust powers being contained in the documents identified above as Exhibits 1 and 2. 4. A copy of the existing By-Laws of the Trustee (see Exhibit 4 to Form T-1 filed in connection with Registration Statement No. 333-76439, which is incorporated by reference). 5. Not applicable. 6. The consent of the Trustee required by Section 321(b) of the Act (see Exhibit 6 to Form T-1 filed in connection with Registration Statement No. 33-50010, which is incorporated by reference. On July 14, 1996, in connection with the merger of Chemical Bank and The Chase Manhattan Bank (National Association), Chemical Bank, the surviving corporation, was renamed The Chase Manhattan Bank). 7. A copy of the latest report of condition of the Trustee, published pursuant to law or the requirements of its supervising or examining authority. 8. Not applicable. 9. Not applicable. SIGNATURE Pursuant to the requirements of the Trust Indenture Act of 1939 the Trustee, The Chase Manhattan Bank, a corporation organized and existing under the laws of the State of New York, has duly caused this statement of eligibility to be signed on its behalf by the undersigned, thereunto duly authorized, all in the City of New York and State of New York, on the 2nd day of June, 2000. THE CHASE MANHATTAN BANK By ------------------------- P. Kelly Vice President -3- Item 16. List of Exhibits List below all exhibits filed as a part of this Statement of Eligibility. 1. A copy of the Articles of Association of the Trustee as now in effect, including the Organization Certificate and the Certificates of Amendment dated February 17, 1969, August 31, 1977, December 31, 1980, September 9, 1982, February 28, 1985, December 2, 1991 and July 10, 1996 (see Exhibit 1 to Form T-1 filed in connection with Registration Statement No. 333-06249, which is incorporated by reference). 2. A copy of the Certificate of Authority of the Trustee to Commence Business (see Exhibit 2 to Form T-1 filed in connection with Registration Statement No. 33-50010, which is incorporated by reference. On July 14, 1996, in connection with the merger of Chemical Bank and The Chase Manhattan Bank (National Association), Chemical Bank, the surviving corporation, was renamed The Chase Manhattan Bank). 3. None, authorization to exercise corporate trust powers being contained in the documents identified above as Exhibits 1 and 2. 4. A copy of the existing By-Laws of the Trustee (see Exhibit 4 to Form T-1 filed in connection with Registration Statement No. 333-76439, which is incorporated by reference). 5. Not applicable. 6. The consent of the Trustee required by Section 321(b) of the Act (see Exhibit 6 to Form T-1 filed in connection with Registration Statement No. 33-50010, which is incorporated by reference. On July 14, 1996, in connection with the merger of Chemical Bank and The Chase Manhattan Bank (National Association), Chemical Bank, the surviving corporation, was renamed The Chase Manhattan Bank). 7. A copy of the latest report of condition of the Trustee, published pursuant to law or the requirements of its supervising or examining authority. 8. Not applicable. 9. Not applicable. SIGNATURE Pursuant to the requirements of the Trust Indenture Act of 1939 the Trustee, The Chase Manhattan Bank, a corporation organized and existing under the laws of the State of New York, has duly caused this statement of eligibility to be signed on its behalf by the undersigned, thereunto duly authorized, all in the City of New York and State of New York, on the 2nd day of June, 2000. THE CHASE MANHATTAN BANK By /s/ P. Kelly ------------------------- /s/ P. Kelly -----END PRIVACY-ENHANCED MESSAGE-----