Exhibit 1
VIRGINIA ELECTRIC AND POWER COMPANY
First and Refunding Mortgage Bonds
UNDERWRITING AGREEMENT
March 22, 1995
Salomon Brothers Inc
as Representative for
the Several Underwriters
named in Schedule II hereto
Seven World Trade Center
New York, New York 10048
Dear Sirs:
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"
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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
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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 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, N.A., 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
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Company represents and warrants to the Underwriters that:
(a) A registration statement, No. 33-50423, 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 "Commission"),
a copy of which as so filed has been delivered to you, has been
declared effective (any preliminary prospectus included in such
registration statement being hereinafter called a "Preliminary
Prospectus"; the various parts of such registration statement,
including all exhibits thereto other than the Statement of
Eligibility on Form T-1 of the Trustee under the Trust Indenture
Act of 1939, as amended (the "Trust Indenture Act"), each as
amended at the time such part became effective, being hereafter
collectively called 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 pursuant to Rule 424(b) under the Securities Act in
the form in which it is first so filed, as so supplemented, and
as may be supplemented pursuant to the following sentence, being
hereinafter called the "Prospectus"). Whenever the term
"Registration Statement", "prospectus", "Preliminary Prospectus"
or "Prospectus" is used herein, it shall be deemed to include all
documents or portions thereof incorporated therein by reference
(the "Incorporated Documents") pursuant to the requirements of
Form S-3 under the Securities Act, and any reference to any
amendment or supplement to any prospectus, Preliminary Prospectus
or the Prospectus shall be deemed to refer to and include any
documents filed after the date of such prospectus, Preliminary
Prospectus or Prospectus, as the case may be, under the
Securities Exchange Act of 1934, as amended (the "Securities
Exchange Act"), and incorporated therein by reference. So long as
the Underwriters are required pursuant to the Securities Act to
deliver a prospectus to purchasers of the Bonds, the Company will
not file any amendment or supplement to the Registration
Statement or the Prospectus unless the Representative shall have
been advised of the proposed amendment or supplement and the same
shall not have been disapproved as to substance by the
Representative or as to form by McGuire, Woods, Battle & Boothe,
L.L.P., who are acting as counsel for the Underwriters.
(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 and the Trust Indenture Act, and the
rules, regulations and releases of the Commission thereunder, and
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; provided, that the foregoing
representations and warranties in this subparagraph (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 to be modified or superseded for purposes of the
Registration Statement or Prospectus to the extent that the
statement has been modified or superseded by any statement in a
subsequently filed Incorporated Document or in the Registration
Statement or Prospectus.
(c) Deloitte & Touche, LLP, who have examined certain of
the 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 the Prospectus as in existence on the
date hereof, since the respective most recent dates as of which
information is given in such 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 such 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
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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
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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 paragraph 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:
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(a) The Company, at or prior to the Closing Date, will
deliver to the Representative conformed copies of the
Registration Statement as originally filed and of all amendments
thereto, heretofore or hereafter made, including any
post-effective amendment (in each case including all exhibits
filed therewith, and including unsigned copies of each consent
and certificate included therein or filed as an exhibit thereto,
except exhibits incorporated by reference unless specifically
requested). As soon as the Company is advised thereof, it will
advise the Representative orally of the issuance of any stop
order under the Securities Act with respect to the Registration
Statement, or the institution of any proceedings therefor, of
which the Company shall have received notice, and will use its
best efforts to prevent the issuance of any such stop order and
to secure the prompt removal thereof, if issued. The Company
will deliver to the Representative sufficient conformed copies of
the Registration Statement and Prospectus and of all amendments
thereto (in each case without exhibits) for distribution of one
to each Underwriter and will deliver to the Underwriters, in
accordance with the Representative's instructions, from time to
time, as many copies of the Prospectus as the Representative may
reasonably request for the purposes contemplated by the
Securities Act or the Securities Exchange Act.
(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 fees and
disbursements of Underwriters' counsel, McGuire, Woods, Battle &
Boothe, L.L.P., 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) The Company will furnish the Representative with
copies of each further amendment and supplement to the Prospectus
relating to the offering of the Bonds in such quantities as the
Representative may from time to time reasonably request. If
during the period when the delivery of a prospectus shall be
required by law in connection with the sale of any Bonds by an
Underwriter or dealer, any event relating to or affecting the
Company, or of which the Company shall be advised in writing by
the Representative, shall occur, which in the opinion of the
Company or of Underwriters' counsel should be set forth in a
supplement to or an amendment of the Prospectus in order to make
the Prospectus not misleading in the light of the circumstances
when it is delivered, or if for any other reason it shall be
necessary during such period to amend or supplement the
Prospectus or to file under the Securities Exchange Act any
document incorporated by reference in the Prospectus in order to
comply with the Securities Act, the Securities Exchange Act or
the Trust Indenture Act, the Company forthwith will (i) notify
the Representative to suspend solicitation of purchases of the
Bonds and (ii) at its expense, make any such filing or prepare
and furnish to the Representative a reasonable number of copies
of a supplement or supplements or an amendment or amendments to
the Prospectus which will supplement or amend the Prospectus so
that, as supplemented or amended, it will not contain any untrue
statement of a material fact or omit to state any material fact
necessary in order to make the statements therein, in the light
of the circumstances when the Prospectus is delivered, not
misleading or which will effect any other necessary compliance.
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 subparagraph, 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 McGuire, Woods, Battle & Boothe, L.L.P.
(d) 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.
(e) For a period of five years following the Closing
Date, the Company will deliver to the Representative, as soon as
practicable after the end of each fiscal year, a balance sheet of
the Company as of the end of such year and statements of income
and earnings reinvested in business for such year, all as
certified by independent public or certified public accountants,
and will deliver to the Representative upon request, as soon as
practicable after the end of each quarterly period, statements of
income and earnings reinvested in business for the 12 month
period ending with the end of such quarterly period.
(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
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 of McGuire, Woods, Battle &
Boothe, L.L.P., who are acting as counsel for the Underwriters
(exclusive of fees and disbursements of such counsel which are to
be paid as set forth in subparagraph (b) of this paragraph 6),
shall be paid by the Underwriters; provided, however, that if
this Agreement is terminated in accordance with the provisions of
paragraphs 7, 8, 10(b) or 10(c) 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. The
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obligations of the Underwriters to purchase and pay for the Bonds
shall be subject to the following conditions:
(a) 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. If filing of the Prospectus, or any supplement
thereto, is required pursuant to Rule 424(b), the Prospectus, and
any such supplement, shall have been filed in the manner and
within the time period required by Rule 424(b). 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, the President or any Vice President of the
Company to the effect that no such stop order is in effect and
that no proceedings for such purpose are pending before, or to
the knowledge of the Company threatened by, the Commission.
(b) 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).
(c) At the Closing Date the Representative shall
receive, on behalf of the several Underwriters, the opinions of
McGuire, Woods, Battle & Boothe, L.L.P. , Hunton & Williams and
Jackson & Kelly, substantially in the forms attached hereto as
Schedules III through V.
(d) 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, (i)
confirming that they are independent public accountants as
required by the Securities Act; (ii) 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; (iii) 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 (iv) stating, in effect,
that on the basis of more limited procedures than those set forth
in the foregoing clause (iii), 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
(iv) 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.
(e) Since the respective most recent dates as of which
information is given in the Registration Statement and Prospectus
as in existence on the date hereof and up to the Closing Date,
there shall not have been any material adverse change in the
condition of the Company, financial or otherwise; since such
dates and up to the Closing Date, the Company shall not have any
material contingent liability, except as reflected in or
contemplated by such Registration Statement and Prospectus, and
there shall not have been any material transaction entered into
by the Company other than transactions contemplated by such
Registration Statement or Prospectus and transactions in the
ordinary course of business; 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,
the President or any Vice President of the Company.
(f) 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 McGuire, Woods, Battle & Boothe, L.L.P.
In case any of the conditions specified above in this
paragraph 7 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 subparagraph 7(e) shall not have
been fulfilled, this Agreement may not be so terminated by the
Representative unless Underwriters who have agreed to purchase in
the aggregate 50% or more of the aggregate principal amount of
the 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 paragraphs 6(b), 6(h), 9 and 10(c) hereof.
8. Conditions of the Obligation of the Company. The
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obligation of the Company to deliver the Bonds shall be subject
to the conditions set forth in the first sentence of paragraph
7(a) and in paragraph 7(b). 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(h), 9 and 10(c) hereof.
9. Indemnification. (a) The Company agrees to indemnify and
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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 a copy of the
Prospectus (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; and provided
further, however, that the indemnity agreement contained in this
paragraph 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 and the representations and warranties of the
Company contained in paragraph 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 theBonds.
(b) Each Underwriter agrees, severally and not jointly,
to indemnify and hold harmless the Company, its officers and
directors, each other Underwriter, and each person who controls
any thereof within the meaning of Section 15 of the Securities
Act or Section 20(a) of the Securities Exchange Act, against any
and all losses, claims, damages or liabilities, joint or several,
to which they or any of them may become subject under the
Securities Act, the Securities Exchange Act, or any other statute
or common law and to reimburse each of them for any legal or
other expenses (including, to the extent hereinafter provided,
reasonable counsel fees) incurred by them in connection with
investigating any such losses, claims, damages or liabilities or
in connection with defending any actions, insofar as such losses,
claims, damages, liabilities, expenses or actions arise out of or
are based upon any untrue statement or alleged untrue statement
of a material fact contained in the Registration Statement or the
Prospectus, or in either such document as amended or supplemented
(if any amendments or supplements thereto shall have been
furnished), or any Preliminary Prospectus (if and when used prior
to the effective date of the Registration Statement), or the
omission or alleged omission to state therein a material fact
required to be stated therein or necessary to make the statements
therein not misleading, if such statement or omission was made in
reliance upon information furnished herein or in writing to the
Company by or on behalf of such Underwriter for use in the
Registration Statement or the Prospectus or any amendment or
supplement to either thereof, or any Preliminary Prospectus. The
indemnity agreement of the respective Underwriters contained in
this paragraph 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.
Each Underwriter represents and warrants that its
commitment to buy the Bonds will not result in a violation of the
financial responsibility requirements of Rule 15c3-1 under the
Securities Exchange Act.
(c) The Company and each of the Underwriters agrees
that, upon the receipt of notice of the commencement of any
action against the Company or any of its officers or directors,
or any person controlling the Company, or against such
Underwriter or controlling person as aforesaid, in respect of
which indemnity may be sought on account of any indemnity
agreement contained herein, it will promptly give written notice
of the commencement thereof to the party or parties against whom
indemnity shall be sought hereunder, but the omission so to
notify such indemnifying party or parties of any such action
shall not relieve such indemnifying party or parties from any
liability which it or they may have to the indemnified party
otherwise than on account of such indemnity agreement. In case
such notice of any such action shall be so given, such
indemnifying party shall be entitled to participate at its own
expense in the defense or, if it so elects, to assume (in
conjunction with any other indemnifying parties) the defense of
such action, in which event such defense shall be conducted by
counsel chosen by such indemnifying party (or parties) and
satisfactory to the indemnified party or parties who shall be
defendant or defendants in such action, and such defendant or
defendants shall bear the fees and expenses of any additional
counsel retained by them; provided that, if the defendants in any
such action include both the indemnified party and the
indemnifying party (or parties) and the indemnified party shall
have reasonably concluded that there may be legal defenses
available to it and/or other indemnified parties which are
different from or additional to those available to the
indemnifying party (or parties), the indemnified party shall have
the right to select separate counsel to assert such legal
defenses and to participate otherwise in the defense of such
action on behalf of such indemnified party. The indemnifying
party shall bear the reasonable fees and expenses of counsel
retained by the indemnified party if (i) the indemnified party
shall have retained such counsel in connection with the assertion
of legal defenses in accordance with the proviso to the preceding
sentence (it being understood, however, that the indemnifying
party shall not be liable for the expenses of more than one
separate counsel, representing the indemnified parties under (a)
or (b), as the case may be, of this paragraph 9 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
paragraph 9 is unavailable to or insufficient to hold harmless an
indemnified party under subparagraph (a) or (b) above in respect
of any losses, claims, damages or liabilities (or actions in
respect thereof) referred to therein, then each indemnifying
party shall contribute to the amount paid or payable by such
indemnified party as a result of such losses, claims, damages or
liabilities (or actions in respect thereof) in such proportion as
is appropriate to reflect the relative fault of the Company, on
the one hand, and of you, on the other, in connection with the
statements or omissions that resulted in such losses, claims,
damages or liabilities (or actions in respect thereof), as well
as any other relevant equitable considerations, including
relative benefit. The relative fault shall be determined by
reference to, among other things, whether the untrue or alleged
untrue statement of a material fact or the omission or alleged
omission to state a material fact required to be stated therein
or necessary in order to make the statements therein not
misleading relates to information supplied by the Company on the
one hand or by you on the other and the parties' relative intent,
knowledge, access to information and opportunity to correct or
prevent such statement or omission. The Company and you agree
that it would not be just and equitable if contribution pursuant
to this subparagraph (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
subparagraph (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
subparagraph (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.
10. Termination of Agreement. (a) 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 paragraphs 6(h)
and 9) or of the Company (except as provided in paragraphs 6(b)
and 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
paragraph shall not relieve any defaulting Underwriter from
liability in respect of any default of such Underwriter under
this Agreement.
(b) This Agreement may be terminated at any time prior
to the Closing Date by the Representative upon notice thereof to
the Company, if prior to such time (i) there shall have occurred
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, (ii) there shall have
occurred any general suspension of trading in securities on the
New York Stock Exchange or there shall have been 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, any
limitation on prices for such trading or any restrictions on the
distribution of securities, (iii) a banking moratorium shall have
been declared either by federal or New York State authorities or
(iv) the United States shall have become engaged in any outbreak
(or escalation) of hostilities or other national or international
calamity or crisis resulting in the declaration of a national
emergency, the effect of which, in the case of this clause (iv),
in your judgment makes it impracticable or inadvisable to proceed
with the public offering or the delivery of the Bonds on the
terms and in the manner contemplated in the Prospectus.
(c) If this Agreement shall be terminated by the
Representative pursuant to subparagraph (b) above or because of
any failure or refusal on the part of the Company to comply with
the terms or to fulfill any of the conditions of this Agreement,
or if for any reason the Company shall be unable to perform its
obligations under this Agreement, then in any such case, the
Company will reimburse the Underwriters, severally, for all
out-of-pocket expenses (in addition to the fees and disbursements
of their counsel as provided in paragraph 6(h)) 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 paragraphs 6(b) and 9.
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 paragraph 9
hereof, each controlling person and each officer and director of
the Company referred to in said paragraph 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,
telecopied or delivered to it, attention Treasurer, Virginia
Electric and Power Company, One James River Plaza, 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: J. KENNERLY DAVIS, JR.
J. Kennerly Davis, Jr.
Vice President, Treasurer and
Corporate Secretary
The foregoing agreement is
hereby confirmed and accepted,
as of the date first above
written.
Salomon Brothers Inc
By: Dominic J. Lepore
Vice President
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 1995,
Series A, 8 1/4%, due March 1, 2025
Aggregate Principal Amount: $200,000,000
Initial Price to Public:
98.705% 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:
98.249% of the principal amount of the Bonds
Specified funds for payment of purchase price - Check payable in
New York Clearing
House funds.
Time of Delivery: March 29, 1995, 10:00 a.m.
Closing Location: Hunton & Williams
200 Park Avenue, 43rd Floor
New York, New York
The Bonds will be available for inspection by the
Representative at: The Chase Manhattan Bank, N.A.
4 Chase Metrotech Center
Brooklyn, New York 11245
Address for Notices to the Underwriters:
Salomon Brothers, Inc.
Seven World Trade Center
New York, New York 10048
SCHEDULE II
Principal Amount
of Bonds to
Underwriter be Purchased
----------- ----------------
Salomon Brothers Inc $ 60,000,000
CS First Boston Corporation 25,000,000
Donaldson, Lufkin & Jenrette
Securities Corporation 25,000,000
PaineWebber Incorporated 25,000,000
Prudential Securities Incorporated 25,000,000
UBS Securities, Inc. 25,000,000
Tucker Anthony Incorporated 5,000,000
Yamaichi International (America), Inc. 5,000,000
Trilon Securities International 5,000,000
-------------
Total $ 200,000,000
=============
SCHEDULE III
PROPOSED FORM OF OPINION
OF
MCGUIRE, WOODS, BATTLE & BOOTHE, L.L.P.
One James Center
Richmond, VA 23219
Re: VIRGINIA ELECTRIC AND POWER COMPANY
First and Refunding Mortgage Bonds of 1995
Series A, 8 1/4%, due March 1, 2025
March 29, 1995
[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
$200,000,000 aggregate principal amount of its First and
Refunding Mortgage Bonds of 1995, Series A, 8 1/4% due March 1,
2025 (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-four supplemental indentures
(said Indenture of Mortgage as so supplemented and modified being
hereinafter called the "Mortgage"), under which The Chase
Manhattan Bank, N.A. is now Trustee, and the purchase of the
Bonds by the several Underwriters pursuant to the Underwriting
Agreement dated March 22, 1995 between you, acting individually
and as Representative of the several Underwriters named in
Schedule II thereto, and the Company (the "Underwriting
Agreement"). All capitalized 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 it necessary to require as a basis for the opinions
hereinafter expressed. As to various questions of fact material
to such opinions, we have, when relevant facts were not
independently established, relied upon certifications by officers
of the Company, the Trustee and other appropriate persons and
statements contained in the Registration Statement hereinafter
mentioned. All legal proceedings taken as of the date hereof in
connection with the issuance and sale of the Bonds have been
satisfactory in form and substance to us.
In addition, we attended the Closing held today at the
office of Hunton & Williams, 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 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 to be modified or
superseded for purposes of the Registration Statement or
Prospectus to the extent that 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 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 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-Third Supplemental
Indenture to recordation, to due and prompt recordation of the
Eighty-Fourth 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-Fourth 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. Hunton & Williams 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-three 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. Hunton & Williams of Richmond, Virginia, and
Raleigh, 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,
McGUIRE, WOODS, BATTLE & BOOTHE, L.L.P.
SCHEDULE IV
PROPOSED FORM OF OPINION
OF
HUNTON & WILLIAMS
Riverfront Plaza, East Tower
951 E. Byrd Street
Richmond, Virginia 23219
Re: VIRGINIA ELECTRIC AND POWER COMPANY
First and Refunding Mortgage Bonds of 1995
Series A, 8 1/4%, due March 1, 2025
March 29, 1995
[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 $200,000,000 aggregate principal
amount of its First and Refunding Mortgage Bonds of 1995 Series
A, 8 1/4%, due March 1, 2025 (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-four
supplemental indentures (such Indenture of Mortgage as so
supplemented and modified being hereinafter called the Mortgage),
under which The Chase Manhattan Bank, N.A. is now Trustee, and
the purchase of the Bonds by the several Underwriters pursuant to
the Underwriting Agreement dated March 22, 1995 between you,
acting individually and as Representative of the several
Underwriters named in Schedule II thereto, and the Company (the
Underwriting Agreement). All capitalized 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 it necessary to require as a basis for the opinions
hereinafter expressed. As to various questions of fact material
to such opinions, we have, when relevant facts were not
independently established, relied upon certifications by officers
of the Company, the Trustee and other appropriate persons and
statements contained in the Registration Statement hereinafter
mentioned. All legal proceedings taken as of the date hereof in
connection with the transactions contemplated by the Underwriting
Agreement have been satisfactory to us.
In regard to the title of the Company to its properties,
we have made no independent investigation of original records but
our opinion is based (a) with respect to land and rights of way
for electric lines of 69,000 volts or more, solely on reports and
opinions by counsel in whom we have confidence and (b) with
respect to rights of way for electric lines of less than 69,000
volts and various matters of fact in regard to all other
properties, solely on information from officers of the Company.
On this basis, we are of the opinion that:
1. The Company is a corporation duly organized and
existing under the laws of Virginia and 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-Fourth
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 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 and title to properties 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, including limitations
upon the issuance of bonds therein, are substantially accurate
and fair, including the statements as to North Carolina and
Virginia titles and defects therein and franchises and permits.
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
Registrations Statement or the Prospectus (except the financial
statements and other financial or statistical information
included or incorporated by reference therein, as to which
weexpress no opinion) 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 or statistical
information included or incorporated by reference therein, 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 to be modified or superseded for
purposes of the Registration Statement or Prospectus to the
extent that 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,
HUNTON & WILLIAMS
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 1995
Series A, 8 1/4%, due March 1, 2025
March 29, 1995
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 $200,000,000 aggregate principal amount of First and Refunding
Mortgage Bonds of 1995, Series A, 8 1/4%, due March 1, 2025 (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-four supplemental indentures
(the Mortgage), and the sale thereof pursuant to an Underwriting
Agreement dated March 22, 1995 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. All capitalized terms not otherwise
defined herein shall have the meanings set forth in the
Underwriting Agreement.
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-Fourth 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-Fourth Supplemental Indenture). 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 an Incorporated Document shall be
deemed to be modified or superseded for purposes of the
Registration Statement or Prospectus to the extent that 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