ML20080T387

Suppl to 830310 Application to Amend Licenses NPF-4 & NPF-7, Adding Name of Old Dominion Electric Cooperative in Appropriate OL Sections.Cooperative Will Be Partial Owner of Facilities.Supporting Documentation Encl

ML20080T387
Person / Time
Site:	North Anna
Issue date:	10/17/1983
From:	Stewart W VIRGINIA POWER (VIRGINIA ELECTRIC & POWER CO.)
To:	Harold Denton, John Miller Office of Nuclear Reactor Regulation
References
319A, NUDOCS 8310200289
Download: ML20080T387 (524)

Text

a  %

VIRGINIA ELECTRIC AND Pownn COMPANY Ricnxown,VINGINIA 20261 W.L. STEWART Vaca Passinazy N :cLuam oFEMATIONE October 17, 1983 Mr. Harold R. Denton, Director Serial No. 319A Office of Nuclear Reactor Regulation N0/JHL:acm Attn: Mr. James R. Miller, Chief Docket Nos. 50-338 Operating Reactors Branch No. 3 50-339 Division of Licensing License Nos. NPF-4 U. S. Nuclear Regulatory Commission NPF-7 Washington, D. C. 20555 Gentlemen:

AMENDMENT TO OPERATING LICENSES NPF-4 AND NPF-7 NORTH ANNA POWER STATION UNIT NOS. 1 AND 2 SUPPLEMENT TO THE PROPOSED OPERATING LICENSE AMENDMENTS By our letter dated March 10, 1983, Serial No. 319, Vepco proposed changes to the Operating Licenses of North Anna Unit Nos. I and 2. The proposed changes were to include the name of the Old Dominion Electric Cooperative (ODEC) in the appropriate sections of the North Anna Unit Nos. I and 2 Facility Operating Licenses. The Old Dominion Electric Cooperative will be a partial owner of the facilities but will not operate them.

The proposed changes that need to be supplemented into our March 10, 1983 submittal are revisions in Attachments 5, 6 and 7, which are the Purchase, Construction and Ownership Agreement, the Interconnection and Operating Agreement and the Nuclear Fuel Agreement, respectively (the Revised Basic Agreements). Under the Revised Basic Agreements, the undivided ownership interest in the North Anna Power Station being sold has changed from 12.5% to 11.6% and the number of participating members in the Old Dominion Electric Cooperative has decreased due to the withdrawal of two members. These changes, as well as other modifications, are identified in enclosed blacklined copies of the Revised Basic Agreements.

It should be noted that the Old Dominion Electric Cooperative does not need to provide antitrust information, fre.2 Appendix L, 10 CFR 50, for NRC review since they have a current generating capacity less than 200 MW(e) (refer to 10 CFR 50.33a, paragraph 3).

f,f r [ A b b AA8 f

' G

'y0 g,A0 8310200289 831017 PDR ADOCK 05000338 p PDR

a .. x VBOINIA Ex.zcTaic awn Fowns COMPANY TO Harold R. Denton It is Vepco's intention to close the deal on the partial sale of North Anna Power Station on November 15, 1983. Your cooperation in approving our proposed license application by that date will be appreciated.

Very truly yours,

)

~

) . .N .C' ._

W. L. Stewart Attachments cc: Mr. James P. O'Reilly Regional Administrator Region II Mr. M. B. Shymlock NRC Resident Inspector North Anna Power Station Mr. Charlie Price Department of Health 109 Governor Street Richmond, Virginia 23219

Page 1 of 3 EXHIBIT A Common Facilities All property of Vepco appearing in the following ac-counts on Vepco's books of account that is within the defini-tion of Common Facilities as well as the Construction Work in Progress and the Completed Construction Not Classified related thereto:

FERC ACCOUNT

• DESCRIPTION 320 Land and Land Richts 321 Structures & Imcrovements Clearing Water System Storm Sewers Sanitary Sewers Fire Protection Fuel Oil Storage RR Track Yard Yard Lighting Boat Dock

. Rifle Range Gun Towers Medical Classroom Condensate Fill Pump Station Auxiliary Building Turbine Building Turbine Outage Building Office Building Screenwell Structure Vacuum Priming Pump House Fuel Building Fuel Oil Pump House

EXHIBIT A Page 2 of 3 FERC ACCOUM9 DESCRIPTION Yard Crane Water Treatment Building Service Building Weather Towers Meteorological Towers Security Building Security Control Center Dam Reservoirs Spillways Dikes Service Water Pump House Decontamination Building Waste Disposal Building Roadways Walkways Parking Lots 322 Reactor Plant Equipment Boron Recovery System Moving Platform Spent Fuel Pit Fuel Building Cranes Decontamination Cranes Fuel Receiving Equipment Spent Fuel Racks Reactor Cavity Purification Radioactive Waste Treatment and Disposal System

. Liquid Waste Solidification System Waste Disposal Evaporator Radioactive Gaseous Waste i

Radioactive Solid Waste Decontamination System Raw Water Supply System Condensate Storage Tank Auxiliary Boiler System 323 Turbo-Generator Equipment Service Water Pump House Equipment Bearing Cooling Water Tower Turbine Room Crane I

EXHISIT A Page 3 of 3 FERC ACCOUNT DESCRIPTION 324 Accessory Electric Equipment Screenwell Area Transformers and Equipment Reserve Station Transformer Bearing Cooling Tower Switch Boards 325 Miscellaneous Power Plant Equipment Compressed Air Systems Miscellaneous Shop Equipment Machine Shop Equipment Laboratory Testing Equipment Office Furniture and Equipment Other General Station Equipment Weather Station Equipment Marine Equipment Kitchen Equipment Fire Protection Equipment Plant Communications Telephone System Security Equipment Radiation Monitoring Equipment Gasoline Storage Equipment 352 Transmission Structures and Improvements j 353 Transmission Station Equipment 1

1 390 Structures and Imorovements l

Visitors Information Center 391 Office Furniture and Equipment 392 Transportation Equipment COMPLETED CONSTRUCTION NOT CLASSIFIED PROJECT NO. DESCRIPTION

( CONSTRUCTION WORK IN PROGRESS PROJECT NO. DESCRIPTION i

I l

l

Page 1 of 3 EXHIBIT B Support Facilities B.01 Definition of Supoort Facilities. At the date of signing, the following shall be the Support Facilities:

ELECTRIC PLANT IN SERVICE FERC ACCOUNT D'ESCRIPTION 353 Transmission Station Equipment Telemetering Equipment COMPLETED CONSTRUCTION NOT CLASSIFIED

, PROJECT NO. DESCRIPTION 99-0182 Surry Nuclear Training Simulator 99-0313 Personnel Radiation Monitoring Exposure System 99-2291 Nuclear Station Emergency Plan Communication System Total Completed Construction Not Classified l'

l l CONSTRUCTION WORK IN PROGRESS l

I PROJECT NO. DESCRIPTION

EXHIBIT B

• Page 2 of 3 e

Thereafter, Support Facilities shall mean all those Facilities, wherever situated, including, but not limited to, both real and personal property, exclusive of Nuclear Fuel, Operating Inven-tory and Major Spare Parts, which are purchased, leased or oth-erwise obtained for the construction, operation and maintenance of one or more Unit (s) located at the North Anna Nuclear Power Station and one or more nuclear Unit (s) located at Vepco's Surry Nuclear Power Station or at such other location as Vepco may have an interest in any nuclear facility and are listed in the following accounts in accordance with the Uniform System of j Accounts:

Plant In Servd:e CCNC Acet. 101 Acet. 106 321 - Structures and Improvements 325 - Miscellaneous Power Plant Equipment 353 - Transmission Station Equipment 397 - Communication Equipment i

Construction Work In Progress l

B.02 Old Dominion's Percentage Ownership Interest in Support Facilities. (a) Except as otherwise modified by the operation of Sections 15.03, 16.01 or 16.02 hereof, Old Domin-l ion's Percentage Ownership Interest in any Support Facility shall be an undividad ownership interest determined in accor-dance with the following formula:

I 1

L-. _ _ _ _ _ _ _ _ . _ __ _ __ .., _ _ _ - _

EXHIBfT B Page 3 of 3 Sum of Old Dominion Percentage Ownership Interests SFOI = in all Units that the Support Facility serves Number of units served by Support Facility (b) It is the intention of the Parties that the formu-la be reapplied at any time that the number of units served by any Support Facility changes for any reason. In any case where ownership interest of the Parties are adjusted, the provisions of Section 16.04 hereof shall apply and appropriate payment shall be made pursuant to Section B.03 hereof.

B.03 Investment and Cost Responsibilities of the Parties for Support Facilities. The investment and cost responsibilities of the Parties for any Support Facility will be shared in proportion to the Parties' then current ownership interest in that Support Facility. Upon any adjustment in Old Dominion's Percentage Ownership Interest in any Support Facili-ty, payment shall be to the Party whose ownership decreased, so that the percentage investment (including all cost components comprising New Investment, undepreciated) of each Party shall be equal to that Party's percentage ownership interest in the respective Support Facility.

Page 1 of 8 EXHIBIT C Major Spare Parts C.01 Description of Major Spare Parts. Those major items, each costing more than $100,000, as.follows:

Electrical Generator Transferred From N.A. 3 Under .

Improvement Project No. IR 7041 Turbine Rotors - For N.A. Units 1 & 2 Improvement Project No. 4841; Stored At Westinghouse, near Charlotte, N.C.

Reactor Cooling Pump Motor -

7000 HP for N.A. Units 1 & 2 Full Length Rod Cluster Assembly -

Control 17 x 17, P/N 1186 F66G02 P.O. & Line No. 32080001 Improvement Project No. 4324 Turbine Rotor N. A. Unit 1 Improvement Project No. 4856 Out for Repair at Westinghouse, near Charlotte, N.C.

Major Spare Parts shall also include any other major items that the Parties agree (i) to keep in inventory and (ii) to desig-nate as Major Spare Parts for possible use in replacing similar items in units located not only at the North Anna Nuclear Power Statien but also at other power stations. Such designation shall state the units that the Major Spare Part is designated to serve.

EXHIBIT C Page 2 of 8 c.02 Old Dominion's Percentage Ownershio Interest in Major Soare Parts. (a) Except as otherwise modified by the operation of Sections 15.03, 16.01 or 16.02 hereof, Old Domin-ion shall own its Old Dominion's Percentage Ownership Interest in any Major Spare Part until such Major Spare Part is used in a unit other than the Units. Upon use in any such unit, Vepco shall purchase such Major Spare Part from Old Dominion in ac-cordance with C.04 hereof.

(b) Vepco agrees to pay carrying charges, if any, with respect to each Major Spare Part equal to (1) Old Dominion's Percentage Ownership Interest, less (ii) the sum of Old Domin-ion's Percentage Ownership Interest in any Unit that the Major Spare Part serves, divided by the total number of units served by the Major Spare Part.

(c) It is the intention of the Parties that the formu-la be reapplied at any time that the number of units served by

( any Major Spare Part or Old Dominion's Percentage Ownarship In-terest changes for any reason. In any case where ownership in-l terest of the Parties are adjusted, the provisions of Section 16.04 hereof shall apply and appropriate payment shall be made i

I pursuant to Section C.04 hereof.

C.03 Ownershio Resconsibilities - Major Soare Parts.

Vepco may make use of any Major Spare Part in any of the units at the North Anna Nuclear Power Station or other power stations for which such parts have been designated to serve in accor-dance with Section C.01 hereof and in accordance with the following conditions:

l l

,e*

ERHIBIT C Page 3 of 8 A. If at any time a unit at the North Anna Nuclear Power Station or other power stations has need of a Major Spare Part to replace any part of an equiva-lent item that has been damaged, such Major Spare Part may be used in such unit; provided t'-st anoth-er unit (for which the part has been designated in accordance with Section C.01 hereof) located at ei-ther station had not been damaged earlier and made crior claim to use such Major Spare Part.

B. When a Major Spare Part is used in any unit, Vepco and Old Dominion shall have an obligation either to (i) repair such damaged item or'(ii) to acquire a new item in place of the damaged item, as.expedi-tiously as possible, and to return it to the origi-nal location of the Major Spare Part that was used.

Payment therefor will be in accordance with Section C.04 hereof.

Any time that any Major Spare Part is us'ed in any unit other than the Units, Vepco shall be obliged to make payment to Old Dominion. The adjustr'.br of ownership interest at the time a Major Spare Part . t s aec Ahall conform, in all respects , to the provisions of Section 16.04 hereof.

l

1 EXHIBIT C Page 4 of 8 C.04 Cost Responsibilities - Major Soare Parts. Cost and payment responsibilities of the Parties for the Major Spare Parts shall be determined in accordance with the following:

A. Subject to the provisions of Section C,04 (D) hereof, the responsibility of the Parties for any New Investment or costs for any Major Spare Part will be shared in proportion to the Parties then current ownership interest in that Major Spare Part.

B. Vepco shall pay carrying chargez on the interest stated in Section C.02(b), based upon the same principles under which carrying charges are paid pursuant to Appendix C of the Interconnection and Operating Agreement, excluding cancellation costs, taxes payable at closing and deferred taxes set forth in Exhibit N of the Purchase Agreement and the 15 percent mark-up reflec'. sd therein, while reflecting Old Dominion's actual cost of capital /(

used to finance such Major Spare Parts, rather than 11%.

C. Upon the use of any Major Spare Part in a non-North Anna unit, Vepco shall pay Old Dominion the amount necessary so that Old Dominion's net investment as reflected on Old Dominion's books in that Major

EXHIBIT C Page 5 of 8 Spare Part is $0. Upon the use of any Major Spare Part in a Unit, Vepco will cease paying carrying charges pursuant to Section C.02(b) on that Major Spare Part until a replacement Major Spare Part is acquired. The provisions of Section 16.04 shall apply to any adjustment under that Section.

D. The Parties shall pay for any replacement Major Spare Part, subject to the next sentence, in pro-portion to their respective ownership interests in the unit in which the Major Spare Part was used, but the investment attributed to the replacement Major Spare Part when such part is designated as a Major Spare Part shall be equal to the dollar amount initially invested in the Major Spare Part that was used in the Unit needing that part. Ac-cordingly, when the repaired or replacement part is designated a Major Spare Part, a payment shall be made to the appropriate Party so that the then re-sulting investment of the Parties in the Major Spare Part shall be equal to the investment of the Parties in the Major Spare Part that was used in the Unit needing that part.

EKEIBIT C Page 6 of 8 E. Upon any adjustment in Old Dominion's Percentage Ownership Interest in any Major Spare Part pursuant to Section C.02(c), payment shall be made to the Party whose ownership interest decreased, so that the percentage investment (including all cost com-ponents comprising New Investment, undepreciated) of each Party shall be equal to that Party's per-centage ownership interest in the respective Major Spare Part.

C.05 Hypothetical Illustration.

Hypothetical Illustration of Cost Responsibility Associated With Ownership, Use and Replacement of Major Spare Parts Pursuant to Exhibit C

1. Major Spare Part - Net Investment $10,000,000

2. Ownership Responsibility VEPCO 88.4% $ 8,840,000 ODEC 11.6% $ 1,160,000 Case (1) Major Spare Part Utilized at the Surry Nuclear Power State

- Replacement Costs More

1. Payment to ODEC at the time Major Spare Part is taken from its storage location $ 1,160,000

2. Cost of replacement (FOB) paid by VEPCO (100%) $20,000,000 l

! 3. Payment by ODEC at the time Major Spare Part l

is replaced in its original location $ 1,160,000

4. Net 7.nvestment in the Major Spare Part for computation of cost responsibility when such part is next utilized $10,000,000 l

l l

l

EKHIBIT C Page 7 of 8 Case (2) Major Spare Part Utilized at the North Anna Nuclear Power Station

- Reclacement Costs More

1. No payment at the time Major Spare Part is taken from its storage location $ ,

2. Cost of replacement (FOB) paid by:

VEPCO (88.4% x $20,000,000) S17,680,000 ODEC (11.6% x $20,000,000) $ 2,320,000

3. Net Investment in the Major Spare Part for computation of cost responsibility when such part is next utilized $10,000,000 Case (3) Major Spare Part Utilized at the Surry Nuclear Power Station

- Reclacement Costs Less

1. Payment to CDEC at the time Major Spare Part is taken from its storage location S 1,160,0C0

2. Cost of replacement (FOB) paid by VEPCO (100%) $ 5,000,000

3. Payment by ODEC at the time Major Spare Part is replaced in its original location S 1,160,000

4. Net Investment in the Major Spare Part for computation of cost responsibility when such part is next utilized $10,000,000 Case (4) Major Spare Part Utilized at the North Anna Nuclear Power Station

- Reolacement Costs Less

1. No payment at the time Major Spare Part is taken from its storage location $

2. Cost of replacement (FCB) paid by:

VEPCO (88.4% x $5,000,000) $ 4,420,000 ODEC (11.6% x $5,000,000) $ 580,000

3. Net Investment in the Major Spare Part for computation of cost responsibility

EXHIBIT C Page 8 of 8 when such part is next utilized $10,000,000

,_ _ , . - - - r w - - - v

Page 1 of 1 EXHIBIT D North Anna Unit 1 All property of Vepco appearing in the following ac-counts on Vepco's books of account that is defined as North Anna Unit 1 in this Agreement as well as the Construction Work in Progress and the Completed Construction Not Classified re-lated thereto:

FERC ACCOUNT DESCRIPTION 321 Structures and Improvements 322 Reactor Plant Equipment 323 Turbogenerator Units 324 Accessory Electric Equipment 325 Miscellaneous Power Plant Equipment l

I

. . - -,..m , _ _ , . - ~ , , , . , _ , _ _ _ . , , _ . _ . - _ _ . - _ _ , _ _ , _ _ _ . _ . , _ _ . , , . - , _ __,-_,.,..,_,,-__,.__,.m .. . . _ . , , . , - _ __

Page 1 of 1 EXHIBIT E North Anna Unit 2 All property of Vepco appearing in the following ac-counts on Vepco's books of account that is defined as North Anna Unit 2 in this Agreement as well as the Construction Work in Progress and the Completed Construction Not Classified re-lated thereto:

FERC ACCOUNT DESCRIPTION 321 Structures and Improvements 322 Reactor Plant Equipment 323 Turbogenerator Units 324 Accessory Electric Equipment 325 Miscellaneous Power Plant Equipment

/

l

- - , -e. r. , , , . ~, - - , - c. ,,,-..--.,, .,w,- ,- ,-.-- . e,. .

Page 1 of 1 EXHIBIT F Old Dominion Members BARC Electric Cooperative Millboro, VA

/\

Community Electric Cooperative Windsor, VA A

Mecklenburg Electric Cooperative Chase City, VA Northern Neck Electric Cooperative Warsaw, VA Northern Virginia Electric Cooperative Manassas, VA Prince George Electric Cooperative Waverly, VA A

Rappahannock Electric Cooperative Bowling Green, VA Shenandoah Valley Electric Cooperative Dayton, VA Southside Electric Cooperative Crewe, VA A

Page 1 of 10 EXHIBIT G Form of Soecial Warrantv Deed THIS SPECIAL WARRANTY DEED, dated as of the __ day of

, 1983, between VIRGINIA ELECTRIC AND POWER COMPANY, a Virginia public service corporation ("Vepco"), and OLD DOMIN-ION ELECTRIC COOPERATIVE, a Virginia generation and transmis-sion cooperative ("Old Dominion"), Vepco and Old Dominion being hereinafter called the " Parties", recites and provides:

RECITALS:

1. By a Purchase, Construction and Ownership Agreement dated as of December 28, 1982, but amended and restated on October 17, 1983 (together, the " Purchase Agreement"), between the Parties, Vepco agreed to sell and Old Dominion agreed to purchase an 11.6 percent undivided interest in certain real property located in the Counties of Louisa, Orange and Spotsylvania, Virginia, known as the North Anna Nuclear Power Station and more particularly described on the attached Sched-ule A (the " Property").

j 2. Pursuant to the Purchase Agreement, Vepco now de-sires to grant and convey such 1".6 percent undivided interest in the Property to Old Dominion.

l l

l l

.m - _

i 1

1 I

Exhibit G Page 2 of 10 i

CONVEYANCE:

NOW, THEREECRE, for and in consideration of ten dollars

($10) paid by Old Dominion and other good and valuable consid-eration, the receipt and sufficiency of which is hereby ac-knowledged, Vepco, subject to the exceptions, reservations, easements, conditions, restrictions, encumbrances, covenants, agreements, limitations and waivers hereinafter described, hereby grants and conveys to Old Do. minion, with special warran-ty, an 11.6 percent undivided interest in the Property, as de-scribed in Schedule A hereto, as tenants in common with Vepco.

Vepco, for itself and its successors and assigns, (i) excepts from this conveyance all its system electric transmis-sion facilities now located on the land herein described in Part 1 of Schedule A (the " Land"), and (ii) reserves the per-l petual rights, privileges and easements of right of way to lay, construct, operate and maintain one or more lines of poles, towers, structures, cables, conduits, pipes and mains together with all wires, manhcles, handholes, valves, regulators, me-ters, attachments, equipment, accessories and appurtenances de-sirable in connection therewith (hereinafter collectively referred to as " Facilities"), for the purpose of transmitting and distributing electric power, for the purpose of trans-porting natural gas, oil, petroleum products or any other l

i I

Exhibit G Page 3 of 10 liquids, gases or substances which can be transported through a pipeline, and for communication purposes, over, under, upon and across the Land at the following described locations:

1. All that certain parcel or tract of land designated on the plat of survey (the " Plat") dated May 27, 1983, styled

" North Anna Power Station Exclusion Area," as the " Easement Area" and is scre particularly described by reference to the Plat as follows:

Beginning at a point on the established exclusion area boundary line (the " Boundary") of the North Anna Power Station 333.94 feet along the Boundary from the Boundary's intersection with the center line of State Route 700, the coordinates of such intersection being North 141298.423 and East 2199414.597-Virginia State Coordinate System-North Zone; thence from such point of beginning in a northwestwardly direction along the Boundary 272.61 feet, being a curve to the right having a radius of 5000 feet, a chord of 272.56 feet and a chord bearing of N. 25* 34'54" W., to a point; thence N. 33 58'54" E. 3194.94 feet to a point; thence N. 68 30'45" E.

359.47 feet to a point; thence N. 21 28'41" W. 210.24 feet to a point; thence N. 8 29'03" E. 2845.22 feet to a point; thence N. 5* O2'38" E. 816.10 feet to a point on the Boundary; thence along the Boundary in a northeastwardly direction 309.39 feet, being a curve to the right having a radius cf 5000 feet, a chord of 309.34 feet and a chord bearing of N. 67* 47'26" E.,

to a point; thence S. 5* O2'38" W. 966.02 feet to a point; thence S. 8 29'03" W. 1329.25 feet to a point; thence N. 68 37'15" E. 5323.70 feet to a point on the Boundary; thence along the Boundary in a southeastward 1y direction 334.50 feet, being a curve to the right having a radius of 5000 feet, a chord of 334.42 feet and a chord bearing of S. 56 03'38" E., to a point; thence S. 68 37'15" W. 4948.93 feet to a point; thence l

S. 21 28'26" E. 2465.31 feet to a point; thence S. 68 31'34" W. 1346.41 feet to a point; thence S. 11 24'14" E. 42"~.57 feet to a point; thence S. 8 21'14" E. 190.91 feet to point on the Boundary; thence along the Boundary in a northwestwardly direction 292.44 feet, being a curve to the right having a ra-dius of 5000 feet, a chord of 292.40 feet and a chord bearing of N. 78 29'21" W., to a point; thence N. 8 21'14" W. 84.23 feet to a point; thence N. 11 24'14" W. 4618.34 feet to a point; thence N. 56 01'06" W. 845.35 feet to a point; thence S. 33 58'54" W. 3009.98 feet to the point of beginning.

Exhibit G '

Page 4 of 10

2. All that certain parcel or tract of land 275 feet in width for the proposed North Anna to Louisa 230kV Transmission Line. The southeastern boundary line of such easement parcel begins at a point on the Boundary 333.94 feet (in a northwest-erly direction along the Boundary) from intersection of the Boundary and the center line of State Route 700 and such ease-ment parcel extends in a southwesterly direction across the Land.

3. All that certain parcel or tract of land 275 feet in width known as the North Anna to Morrisville 500kV Transmission Line (the "Morrisville Line") which begins at the Boundary and extends in a northerly direction across the Land; the western boundary line of the easement parcel hereby reserved being 75 feet from and parallel to the center line of the existing Mor-risville Line.

4. All that certain parcel or tract of land 275 feet in width known as the North Anna to Ladysmith 500kV Transmission Line (the "Ladysmith Line") which begins at the Boundary and extends in a northeasterly direction across the Land; the northern boundary line of the easement parcel hereby reserved being 75 feet from and parallel to the center line of the ex-isting Ladysmith Line.

5. All that certain parcel or tract of land 275 feet in width known as the North Anna to Midlothian 500kV Transmission Line (the "Midlothian Line") which begins at the boundary and extends in a southerly direction across the Land; the western boundary line of the easement parcel hereby reserved being 75

. feet from and parallel to the center line of the existing

) Midlothian Line.

l .

The easement parcels described in paragraphs 1, 2, 3, 4 and 5 immediately above are hereinafter collectively referred to as the " Easement Parcels".

l l

Any and all Facilities installed in, on, over or under the Easement Parcels shall remain the property of Vepco. Vepco shall have the right to inspect, rebuild, remove, repair, im-prove, extend or relocute any of the Facilities on the Easement

. Parcels, and make such changes, alterations, substitutions, l

l l

Exhibit G Page 5 of 10 additions or extensions to any of the Facilities, including the right to increase or decrease the voltage and the number of wires. Vepco shall construct, operate and maintain the Facili-ties in accordance with the requirements of the National Elec-trical Safety Code. Vepco shall have the right to assign or transfer, without limitation, all or any part of the perpetual rights, privileges, and easements of right of way hereby re-served.

In addition, Vepco shall have the right to keep the Easement Parcels clear of all buildings and structures. Vepco shall also have the right to keep the Easement Parcels clear of all trees, limbs, stumps, roots and to clear or control under-growth together with the further right to trim or fell any tree on the Land and lying outside the Easement Parcels that, in the opinion of Vepco, constitutes a hazard to or may endanger the safe or proper operation of any of its Faci _lities. (Such a tree shall be any tree that in falling or being felled could come within ten feet of any conductor.) Vepco shall dispose of all trees, limbs, stumps, roots and undergrowth cut, uprooted or felled by Vepco.

Further, Vepco reserves from this conveyance an ease-ment of right of way for ingress and egress over, upon, across and along the Land for the purpose of constructing, inspecting, maintaining or operating any of its Facilities.

i Exhibit G Page 6 of 10 This conveyance is subject to all existing axceptions, reservations, easements, conditions, restrictions, covenants, agreements, limitations and waivers that may apply to the Prop-erty or any part thereof, including but not limited to, the Permitted Encumbrances, the provisions for Waiver of Partition set forth in Article X of the Purchase Agreement and all of the provisions of the Basic Agreements.

The Purchase Agreement together with an Interconnection and Operating Agreement dated as of December 28, 1982, but amended and restated on October 17, 1983, and a Nuclear Fuel Agreement, dated as of December 28, 1982, but amended and restated on October 17, 1983, each between Vepco and Old Domin-ion are incorporated herein by reference, and copies thereof are attached hereto as Appendices I, II and III, respectively.

Terms used herein and defined in the Purchase Agree-ment, but not otherwise defined herein, shall be deemed to have the meanings specified in the Purchase Agreement.

IN WITNESS WHEREOF, the Parties hereto have caused three counterparts of this Deed, each of which shall be deemed to be an original, to be executed, and their respective corpo-rate seals to be hereunto affixed and attested, by their re-spective duly authorized corporate officers.

Exhibit G Page 7 of 10 VIRGINIA ELECTRIC AND POWER COMPANY

[ SEAL) By .

Vice President ATTEST:

Assistant Corporate Secretary OLD DOMINION ELECTRIC COOPERATIVE (SEAL) By President Attest:

Secretary 1

.,...-n. ,. . _,. , , , . , , , , ,.,,..-.---_,n . , . _ ,.n n--n,._,. --. .-

1 l

1 l

\

Exhibit G l Page 8 of 10 COMMONWEALTH OF VIRGINIA )

) To-wit:

CITY OF RICHMOND )

The foregoing instrument was acknowledged before me in the City of Richmond, Virginia this day of ,

198_, by and , as Vice President and Assistant Corporate Secretary, respectively, of VIRGINIA ELECTRIC AND POWER COMPANY, a Virginia corporation, on behalf of the corporation.

My commission expires:

Notary Public COMMONWEALTH OF VIRGINIA )

) To-wit:

OF )

The foregoing instrument was acknowledged before me in the City of Richmond, Virginia, this day of ,

198_, by and , as President and Secretary, respectively, of OLD DOMINION ELECTRIC COOPERA-TIVE, a Virginia generation and transmission cooperative, on

, behalfodthecooperative.

I My commission expires:

Notary Public l

r Exhibit G Page 9 of 10 Schedule A to Deed from Virginia Electric and Power Company to Old Dominion Electric Cooperative _

Part 1. ALL that certain piece or parcel of land, together with all improvements thereon and appurte-nances thereunto belonging, except as herein reserved by Vepco, lying and being in the Counties of Louisa, Orange and Spotsylvania, Virginia, more particularly described as follows:

Being all of the same land acquired by Vepco by those certain deeds listed in Part I of Appendix A attached hereto, made a part hereof and recorded herewith and to which reference is hereby made for a more particular description.

LESS and EXCEPT, however, the land conveyed by Vepco to others by those certain deeds listed in Part II of Ap-pendix A also attached hereto, made a part hereof and recorded herewith and to which reference is hereby made for a more pcrticular description.

Part 2. All the rights, privileges and easements acquired by Vepco to construct, place, operate and maintain an above ground warning device in the Counties of Louisa, Orange, Spotsylvania, Caroline and Hanover, Virginia, as set forth in those certain agreements

Exhibit G Page 10 of 10 listed in Part III of Appendix A also attached hereto, made a part hereof and recorded herewith and to which reference is hereby made for a more particular descrip-tion.

Part 3. All the rights, privileges and easements reserved or retained by Vepco in those certain deeds listed in Part II of Appendix A also attached hereto and to which reference is hereby made for a more par-ticular description.

l I

l l

s l

Page 1 of 29 EXHIBIT H Form of Assignment Agreement THIS ASSIGNMENT AGREEMENT, dated as of the day of

, 1983, between VIRGINIA ELECTRIC AND POWER COMPANY, r

! a Virginia public service corporation ("Vepco"), and OLD DOMIN-ION ELECTRIC COOPERATIVE, a Virginia generation and transmis-sion cooperative ("Old Dominion"), recites and provides as fol-lows:

RECITALS:

1. By a Purchase, Construction and Ownership Agreement dated as of December 28, 1982, but amended and restated on October 17, 1983 (the " Purchase Agreement"), between Vepco and Old Dominion, Vepco agreed to sell certain real and personal property to Old Dominion.

2. Pursuant to the Purchase Agreement and simulta-neously with the delivery of this Agreement, Vepco has conveyed i

l to Old Dominion by a deed dated ,

19__ (the

" Deed"), an 11.6 percent undivided interest in a tract or par-cel of land located in the Counties of Louise, Orange and Spotsylvania, Virginia, known as the North Anna Nuclear Power Station, and more particulary described in the Deed.

3. The Purchase Agreement together with an Interconnection and Operating Agreement dated as of December 28, 1982, but amended and restated on October 17, 1983, between l

I

EXHIBIT H Page 2 of 29 Vepco and Old Dominion and a Nuclear Fuel Agreement dated as of December 28, 1992, but amended and restated on October 17, 1983, between Vepco and Old Dominion are attached to the Deed and recorded therewith in the Clerk's Office of the Circuit Court of the Counties of Louisa, Orange and Spotsylvania, Virginia.

4. Pursuant to the Purchase Agreement, Vepco now de-sires to sell and assign to Old Dominion an undivided percent-age interest in the hereinafter described intangible personal property.

ASSIGNMENT AGREEMENT:

NOW, THEREFORE, for and in consideration of the sum of Ten Dollars ($10.00), the premises contained herein and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, Vepco, subject to the matters hereinafter set forth, hereby sells, transfers, grants, sets over, conveys and assigns to Old Dominion the undivided per-centage interest of all the right, title, interest, estate and benefit of Vepco in, to and under all contracts, plans, speci-l fications, surveys, governmental consents, approvals, licenses, permits, certificates of occupancy, zoning approvals and other similar documents listed on the attached Appendix A (collec-tively, the " Contracts") that is equal to the Old Dominion Own-l ership Interest from time to time (aggregated, if necessary) in 1

the component of the Facilities affected by such Contract (s).

l l

r

EXHIBIT H Page 3 of 29 The Contracts are expressly assigned subject to the provisions for Waiver of Partition set forth in Article X of the Purchase Agreepent and all exceptions, reservations, ease-ments, waivers, conditions, licenses, restrictions, encum-brances, covenants, agreements, limitations and waivers that may apply to the Contracts or any portion or part thereof, including but not limited to, the provisions of the Basic Agreements.

Old Dominion has joined in the execution hereof to evi-dence that it hereby (i) accepts this assignment, (ii) assumes a proportionate share of all the duties and obligations under the Contract (s) that is equal to Old Dominion's Percentage Own-ership Interest from time to time (aggregated, if necessary) in the component of the Facilities affected by such Contract (s),

(iii) agrees to fully perform its proportionate share of all such duties and obligatione and (iv) agrees to faithfully ob-serve and comply with all confidentiality provisions and all other similar. restrictions relating to the protection of pro-prietary information contained in the Contract (s) .

l Terms used herein and defined in the Purchase Agree-ment, but not otherwise defined herein, shall be deemed to have the meanings specified in the Purchase Agreement.

The provisions of this Assignment Agreement shall inure to the benefit of and be binding upon the successors and as-signs to the parties hereto.

P EXHIBIT H Page 4 of 29 IN WITNESS WHEREOF, Vepco and Old Dominion have caused this Assignment Agreement to be executed, and their respective corporate seals to be hereunto affixed and attested, by their respective duly authorized corporate officers.

VIRGINIA ELECTRIC AND POWER COMPANY, a Virginia public service corporation By:

Vice President

[ SEAL]

ATTEST:

Assistant Corporate Secretary OLD DOMINION ELECTRIC COOPERATIVE, a Virginia generation and transmission cooperative i By:

l . President

[ SEAL]

Attest:

Secretary 1

l

EXHIBIT H Page 5 of 29 Appendix A Appendix A to an Assignment Agreement dated , 1983 between Vepco and Old Dominion CONSTRUCTION PERMITS

1. United States Atomic Energy Commission; Issuance of Construction Permit Nos. CPPR-77 and CPPR-78 for the Virginia Electric and Power Company to construct North Anna Power Station Units 1 and 2, dated February 19, 1971.

2. United States Atomic Energy Commission; Issuance of Amendment No. 1 to Construction Permit Nos. CPPR-77 and CPPR-78, dated April 14, 1971.

3. United States Atomic Energy Commission Issuance of Amendment No. 2 to Construction Permit Nos. CPPR-77 and CPPR-78, dated October 17, 1972.

4. United States Nuclear Regulatory Commission; Extension of the Completion Dates for Constructing CPPR-77 and CPPR-78 from August 1, 1974 and August 1, 1975 respec-tively to March 1, 1977 and May 1, 1978, respectively.

Issuance of the extension is dated April 15, 1975.

5. United States Nuclear Regulatory Commission; Issuance of Amendment No. 3 to Construction Permit Nos. CPPR-77 and CPPR-78, dated April 9, 1976.

l l

U. S. NUCLEAR REGULATORY COMMISSION OPERATING LICENSE

1. North Anna Power Station, Unit No.1, Facility Operating License, including Appendix A and B Technical Specifi-cations for fuel loading, issued on November 26, 1977.

2. North Anna Power Station, Unit No. 1, Facility Operating License, Amendment No. 1, dated January 26, 1978, allowing North Anna Unit No. 1 to operate in a hot standby position.

EXHIBIT H Page 6 of 29

' 3. North Anna Power Station, Unit No. 1, Facility Operating License, Amendment No. 2, dated March 17, 1978 permitting operation in Mode 3 without the outside recirculation spray pumps.

4. North Anna Power Station, Unit No. 1, Facility Operating License, Amendment No. 3, dated April 1, 1978, allowing North Anna Unit No. 1 to operate at 100%

power.

5. North Anna Power Station, Unit No. 1, Facility Operating License Amendment No. 4, datad May 8, 1978, deleting license conditions 2.D(3)(a) and 2.D(3)(n).

! 6. North Anna Power Station, Unit No. 1, Facility Operating License, Amendment No. 5, dated May 19, 1978, issued to resolve the NPSH problem for the recirculation spray pumps.

7. North Anna Power Station, Unit No. 1, Facility Operating License, Amendment No. 6, dated June 23, 1978, revising the recirculation spray flow of the low-head safety injection pumps and a revision to the cas-ing cooling pump discharge pressure.

8. North Anna Power Station, Unit No. 1, Facility Operating License, Amendment No. 7, dated July 3, 1978, revising license condition 2.D(3)(j).

9. North Anna Power Station, Unit No. 1, Facility Operating License, Amendment No. 8, dated March 6, 1979, revising the implementation of fire protection modifications, license condition 2.D(3)(f) and Techni-cal Specification 3.9.7.

10. North' Anna Power Station, Unit No. 1, Facility

~

Operating License, Amendment No. 9, dated February 23, 1979, incorporating the site security plan.

11. North Anna Power Station, Unit No. 1, Facility Operating License, Amendment No. 10, dated April 27, 1979, revising the Technical Specifications which in-volve in-service inspection of flow splitter plates, displacement of reactor coolant pumps and loose parts monitoring.

12. North Anna Power Station, Unit No. 1, Facility Operating License, Amendment No. 11, dated June 14, 1979, incorporating surveillance requirements for the emergency diesel generator batteries.

4

,e r ,. , ---n -.--,,----,--.,c. , . - - - - ,,,,,,,m, - - n , , , . ,-,,--en--,.,,. , , , , . , _ . , , - - . . . . , - - - . , , , , , . . - - - , , . . . - - , , , , . - . , ,

EXHIBIT H Page 7 of 29

13. North Anna Power Station, Unit No. 1, Facility Operating License, Amendment No. 12, dated June 23, 1979, revising the maximum allowable settlement values of Class I Structures.

14. North Anna Power Station, Unit No. 1, Facility Operating License, Amendment No. 13, dated August 3, 1979, allowing a one time extension to the surveillance frequency for response time testing of systems, safety injection and containment depressurization actuation testing and deleting license conditions 2.D(3)(d) and 2.D(3)(e).

15. North Anna Power Station, Unit No. 1, Facility Operating License Amendment No. 14, dated August 17, 1979, permits the increased storage of fuel in the spent fuel pool.

16. North Anna Power Station, Unit No. 1, Facility Operating License, Amendment No. 15, dated September 14, 1979, allowing a one time extension to the surveil-lance frequency for response time testing of systems, safety injection and containment depressurization actuation testing.

17. North Anna Power Station, Unit No. 1, Facility Operating License, Amendment No. 16, dated December 28, 1979, deleting various license conditions due to their completion.

l

13. North Anna Power Station, Unit No. 1, Facility Operating License, Confirmatory Order, dated January 2, 1980, confirming the implementation of all Category A lessons learned requirements.

19. North.jAnna Power Station, Unit No. 1, Facility i Operating License, Amendment No. 17, dated May 19, 1980, revising Vepco's new management reorganization.

20. North Anna Power Station, Unit No. 1,' Facility Operating License, Amendment No. 18, dated May 19, 1980, correcting an administrative error.

21. North Anna Power Station, Unit No. 1, Facility

, Operating License, Amendment No. 19, dated August 5,

! 1980, deleting various license conditions and Technical Specifications due to their completion.

22. North Anna Power Station, Unit No. 1, Facility Operating License, Revision to the Order for Modifica-tion of License dated August 29, 1980, dated September 19, 1980.

t

- - ---, . . . _ , ~ ,. ,-_---__._m.._-- __- - . . . . - - - - - -

E%H1 BIT H Page 8 of 29

23. North Anna Power Station, Unit No. 1, Facility Operating License, Amendment No. 20, dated October 3, 1980, revising the Safeguards Contingency Plan.

24. . North Anna Power Station,. Unit No.1, Facility Operating License, Order for Modification of License Concerning Environmental Qualification of Safety-Related Electri-cal Equipment, dated October 24, 1980.  !

25. North Anna Power Station, Unit No. 1, Facility Operating License, Amendment No. 21 dated November 19, 1980, revising license condition 2.D(3)(j).

26. North Anna Power Station, Unit No. 1, Facility Operating License, Amendment No. 22, dated December 10, 1980, revising the axial power distribution surveil-lance turn on power and part power axial flux differ-ence limits.

27. North Anna Power Station, Unit No. 1, Facility

Operating License, Amendment No. 23, dated December 30, 1980, deleting water quality requirements from the En-vironmental Technical Specifications and including the Environmental Protection Plan.

28. North Anna Power Station, Unit No. 1, Facility Operating License, Amendment No. 24, dated March 18, 1981, revising charging pump operability.

29. North Anna Power Station, Unit No. 1, Facility operating License, Amendment No. 25, dated March 20, 1981, including a requirement for a Guard Training and Qualification Plan.

30. North, Anna Power Station, Unit No. 1, Facility Operating License, Amendment No. 26, dated March 24, 1981, revising the snubber Technical Specifications.

l 31. North Anna Power Station, Unit No. 1, Facility Operating License, Order for Modification of License Concerning Primary Coolant System Pressure Isolation Valves, dated April 20, 1981.

32. North Anna Power Station, Unit No. 1, Facility Operating License, Amendment No. 27, dated April 29,

! 1980, increasing new and spent fuel enrichments of U-235.

33. North Anna Power Station, Unit No. 1, Facility Operating License, Amendment No. 28, dated May 14, 1981, revise the channel functional test frequency for the loss of power circuitry from 31 days to bimonthly.

EXHIBIT H Page 9 of 29

34. North Anna Power Station, Unit No. 1, Facility Operating License, Amendment No. 29, dated May 14, 1981, deleting a snubber.

35. North Anna Power Station, Unit No. 1, Facility Operating License, Amendment No. 30, dated May 22, 1981, reflecting the corporate and plant reorganiza-tions.

36. North Anna Power Station, Unit No. 1, Facility Operating License, Amendment No. 31, dated May 28, 1981, cleaning.up completed license conditions.

. 37. North Anna Power Station, Unit No.1, Facility Operating License, Amendment No. 32, dated June 2, 1981, revising the decay heat removal capability, adding two Category A lessons learned items and revising the maintenance of minimum water level above fuel assemblies.

38. North Anna Power Station, Unit No. 1, Facility Operating License, Amendment No. 33, dated November 5, 1981, revising the inservice surveillance requirements of safety related snubbers.

39. North Anna Power Station, Unit No. 1, Facility operating License, Amendment No. 34, dated December 9, 1981, revising the testing frequency for pressuri=er PORV testing.

40. North Anna Power Station, Unit No. 1, Facility j Operating License, Amendment No. 35, dated December 31, l

1981, revising the requirements for determining the Quadrant Power Tilt Ratio when above 75% power with one Power Range Channel inoperable.

l -

41. North Anna Power Station, Unit No. 1, Facility Operating License, Amendment No. 36, dated January 19, 1982, increasing the enrichment for new and spent fuel of U-235.

42. North Anna Power Station, Unit No. 1, Facility Operating License, Amendment No. 37, dated February 5, 1982, revising Fxy and the axial power distribution limits.

43. North Anna Power Station, Unit No. 1, Facility Operating License, Amendment No. 38, dated March 25, 1982, adding two containment isolation valves.

l

^

" - EXHfBIT H Page 10 of 29

44. North Anna Power Station, Unit No. 1, Facility Operating License Amendment No. 39, dated April 13,,,

1982, revising the heat flux hot channel factor.

45.

North Anna Power Station', Unit No. 1, Facility Operating License, Amendment No. 40, dated May 6, 1982, providing one-time relief f r,om the JL8 month surveil-lance frequency for testing snubbers greater than 50 kips.

46. North Anna Power Station, Unit No. 1, Facility Operating License, Amendment No. 41, dated August 4, 1982, providing relief from sampling chloridet and flu-orides when the RCS is drained below the reactor pres-sure nozzle and the internals and/or head are in place.

47. North Anna Power Station, Unit No. 1, Facility Operating License, Amendment No. 42, dated October 4, 1982, revising the average RCS temperature from 580.3'F to 582.8'F.

48. North Anna Power Station,- Unit No. 1, Facility Operating License, Amendment No. 43, dated October 20, 1982, adding 20 containment isolation valves to the Technical specifications.

49. North Anna Power Station, Unit No. 1, Facility Operating License, Amendment No. 44, dated November 9, 1982, deleting the requirement for Type C testing con-tainment isolation valve TV-SV102-2.

50. North Anna Power Station, Unit No. 2, Facility Operating License, including Appendix A and B Technical Specifications for fuel loading, issued on April 11, 1980.,

51. North Anna Power Station, Unit No. 2, Facility Operating License, Amendment No. 1, dated July 3, 1980, allowing North Anna Unit No. 2 to conduct.special low power testing.

52. North Anna Power Station, Unit No. 2, Facility Operating License, Amendment No. 2, dated August 18, 1980, providing excepcions to the Technical Specifica-tions for conducting water hammer demonstration tests.

53. North Anna Power Station, Unit No. 2, Facility Operating License, Order for Modification of License Concerning Environmental Qualification of Safety-Related Electrical Equipment, dated November 7, 1980.

. . _ . - . _ _ . _ . , . _ . . _ _ _ . , _ . . _ . . ...._...___....._____._.-._,..._.,m_ _ , ~ , . . _ _ _ _ _ _ - . , . . , _ _ - .

l i

EXHIBIT H Page 11 of 29 1

54. North Anna Power Station, Unit No. 2, Facility Operating License, Issuance of Facility Operating Li-cense NPF-7, dated August 21, 1980, allowing North Anna Unit No. 2 to operate at full power.

55. North Anna Power Station, Unit No. 2, Facility Operating License, Amendment No. 3, dated December 30, l 1980, deleting water quality requirements from the En- t vironmental Technical Specifications and including the {

Environmental Protection Plan.

56. North Anna Power Station, Unit No. 2, Facility Operating License, Amendment No. 4 dated February 10, 1981, revising the time required to complete the piping reanalysis for multi-structure Amplified Re sponse

Spectra.

I 57. North Anna Power Station, Unit No. 2, Facility Operating License, Amendment No. 5, dated March 18,  !

1981, revising charging pump operability requirements.

58. North Anna Power Station, Unit No. 2, Facility Operating License, Amendment No. 6, dated March 20, 1981, including a requirement for a Guard Training and Qualification Plan.

59. North Anna Power Station, Unit No. 2, Facility Operating License, Amendment No. 7, dated April 29, 1981, providing a one-time 30 day extension to the sur-veillance frequency requirements regarding the 125 volt direct current battery 18 month testing.

60. North Anna Power Station, Unit No. 2, Facility Operating License, Amendment No. 8, dated April 29, 1981,, increasing new and spent fuel enrichments of U-235.

61. North Anna Power Station, Unit No. 2, Facility Operating License, Amendment No. 9, dated May 14, 1981, revising the channel functional test frequency for the loss of power circuitry from 31 days to bimonthly.

62. North Anna Power Station, Unit No. 2, Facility Operating License, Amendment No. 10, dated May 15, 1981, deleting a snubber.

63. North Anna Power Station, Unit No. 2, Facility Operating License, Amendment No. 11, dated May 22, 1981, reflecting the corporate and plant reorganiza-tions.

4

r EXHIBfT H Page 12 of 29

64. North Anna Power Station, Unit No. 2, Facility Operating License, Amendment No. 12, dated September 22, 1981, revising the completion date for the Relief and Safety Valve Test Requirements.

65. North Anna Power Station, Unit No. 2, Facility Operating License, Amendment No. 13, dated November 5, 1981, revising the inservice surveillance requirements for safety related snubbers.

66. North Anna Power Station, Unit No. 2, Facility Operating License, Amendment No. 14, dated December 31, 1981, revising the implementation dates of license con-ditions 2.C(21)(e), 2.C(2)(1), subsections (iii), (iv) and (v) and 2.C(21)(j).

67. North Anna Power Station, Unit No. 2, Facility Operating License, Amendment No. 15, dated December 31, 1981, revising the requirements for determining the Quadrant Fower Tilt Ratio when above 75% power with one Power Range Channel inoperable.

68. North Anna Power Station, Unit No. 2, Facility Operating License, Amendment No. 16, dated January 19, 1982, increasing the enrichment for new and spent fuel of U-235.

69. North Anna Power Station, Unit No. 2, Facility Operating License, Amendment No. 17, dated February 5, 1982, revising Fxy and the axial power distribution limits.

70. North Anna Power Station, Unit No. 2, Facility l Operating License, Amendment No. 18, daed February 18,

! 1982,.providing a one-time two week extension to sur-veillance frequency requirements for the 8 month hy-draulic snubber testing requirement.

71. North Anna Power Station, Unit No. 2, Facility Operating License, Amendment No. 19, dated March 25, 1982, adding two containment isolation valves.

72. North Anna Power Station, Unit No. 2, Facility l Operating License, Amendment No. 20, dated April 13, 1 1982, revising the limit of the heat flux hot channel factor.

l

73. North Anna Power Station, Unit No. 2, Facility l Operating License, Amendment No. 21, dated May 3, 1982, revising license condition 2.C(10).

l

i l

EXHIBIT H Page 13 of 29

74. North-Anna Power Station, Unit No. 2, Facility Operating License, Amendment No. 22, dated May 3, 1982, revising the completion date regarding diesel generator reliability.

75. North Anna Power Station, Unit No. 2, Facility Operating License, Amendment No. 23, dated May 4, 1982, revising license condition 2.C(4)(c).

76. North Anna Power Station, Unit No. 2, Facility Operating License, Amendment No. 24, dated May 6, 1982, providing one-time relief from the 18 month surveil-lance frequency for testing snubbers greater than 50 kips.

77. North Anna Power Station, Unit No. 2, Facility Operating License, Amendment No. 25, dated May 17, 1982, adding 20 containment isolation valves to the Technical Specifications.

78. North Anna Power Station, Unit No. 2, Facility Operating License, Amendment No. 26, dated August 10, 1982, revising the completion dates for license condi-tions 2.C(21)(d), 2.C(21)(e) and 2.C(21)(1) subparts (iii) and (v).

79. North Anne Power Station, Unit No. 2, Facility Operating License, Amendment No. 27, dated October 29, 1982, revising the completion dates of license condi-tions 2.C(15)(h)(2) and 2.C(15)(h)(4).

80. North Anna Power Station, Unit No. 2, Facility Operating License, Amendment No. 28, dated January 28,

, 1983, revising the heat flux hot channel factor, FQ, from 2.14 to 2.20.

81. North Anna Power Station, Unit No. 1, Facility Operating License, Amendment No. 45, dated January 28, 1983, revising the heat flux hot channel factor, FQ, from 2.14 to 2.20.

82. North Anna Power Station, Unit No. 1, Facility Operating License, Confirmatory Order dated March 15, 1983, confirming the implementation of NUREG-0737 com-mitments.

83. North Anna Power Station, Unit No. 1, Facility Operating License, Amendment No. 46, dated April 27, 1983, revising the part power multiplier on FNH from 0.2 to 0.3.

EXHIBfT H Page 14 of 29

84. ,

North Anna Power Station, Unit No. 1, Facility Operating License, Amendment No. 47, dated May 4, 1983, revising the audit frequencies of the Station Emergency Plan and implementing procedures and the Station Secu-rity Plan and implementing procedures from once per 24 months to once per 12 months.

85. North Anna Power Station, Unit No. 1, Facility Operating License Amendment No. 48, dated May 5, 1983, revising the Appendix A Technical Specifications to in-clude the requirements of NUREG-0472, Revision 3 and to delete the Part I-Radiological Technical Specifications j from the Appendix 3 Technical Specifications.

86. North Anna Power Station, Unit No. 2, Facility Operating License, Amendment No. 29, dated April 22, 1983, revising the part power multiplier on FNH from 0.2 to 0.3.

87. North Anna Power Station, Unit No. 2, Facility Operating License, Amendment No. 30, dated May 4, 1983, revising the audit frequencies of the Station Emergency Plan and implementing procedures and the Station Secu-rity Plan and implementing procedures from once per 24 months to once per 12 months.

88. North Anna Power Station, Unit No. 2, Facility Operating License, Amendment No. 31, dated May 5, 1983, revising the Appendix A Technical Specifications to in-clude the requirements of NUREG-0472, Revision 3 and to delete the Part I-Radiological Technical Specifications from the Appendix B Technical Specifications.

. SPECIAL NUCLEAR MATERIALS LICENSE

1. North Anna Power Station, Unit No. 1, Issuance of Spe-cial Nuclear Materials License No. SNM-1600, dated April 16, 1976.

2. North Anna Power Station, Unit No. 1, Amendment to.Spe-cial Nuclear Materials License No. SNM-1600, dated November 10, 1976.

3. North Anna Power Station, Unit No. 1, Amendment to Spe-cial Nuclear Materials License No. SNM-1600, dated March 17, 1971.

'4 . North Anna Power Station, Unit No. 1, Amendment to Spe-cial Nuclear Materials License No. SNM-1600, dated November 16, 1977.

EKHIBIT H Page 15 of 29

5. North Anna Power Station, Unit No. 2, Issuance of Spe-cial Nuclear Materials License No. SNM-1801, dated February 22, 1978.

6. North Anna Power Station, Unit No. 2, Amendment to Spe-

-ial Nuclear Materials License No. SNM-1801, dated August 31, 1978.

7. North Anna Power Station Unit No. 2, Amendment to Spe-cial Nuclear Materials License No. SNM-1801, dated February 27, 1979.

8. North Anna Power Station, Unit No. 2, Amendment to Spe-cial Nuclear Materials License No. SNM-1801, dated December 28, 1979.

BYPRODUCT MATERIAL LICENSE

1. North Anna Power Station, Unit Nos. 1 and 2, Issuance of Byproduct Material License No. 45-13670-02, dated July 11, 1975.

2. North Anna Power Station, Unit Nos. 1 and 2, Amendment No. 1 to Byproduct Material License No. 45-13670-02, dated February 23, 1977.

3. North Anna Power Station, Unit Nos. 1 and 2, Byproduct Material License No. 45-13670-04, dated September 13, 1978.

NOTE: The current Source Material Licenses, Byproduct Material Licenses and Special Nuclear Material Licenses are located within the North Anna 1 and 2 Facility Operating Licenses.

4. United States Atomic Energy Commission, Certification i for the Radwaste Treatment Systems at North Anna Unit l Nos. 1 and 2, dated November 12, 1973.

5. North Anna Power Station, Unit nos. 1 and 2, Byproducts Material License No. 45-13670-04, dated September 13, 1978.

I STATE AGENCIES '

1. Commonwealth of Virginia, Water Control Board; 401 Cer-l tificate issued to the Virginia Electric and Power Com-j pany for North Anna Power Station, dated February 11, i 1972.

EXH1 BIT H Page 16 of 29

2. Commonwealth of Virginia Water Control Board, NPDES l

discharge permit, dated, July 7, 1982 (reporting forms excluded).

3. Commonwealth of Virginia, Soil and Water Conservation Department, Approval of the erosion and sediment con-trol plan for the new training center at North Anna Power Station, dated October 14, 1981.

4. Commonwealth of Virginia, Department of Highways, Per-mit to install and attach a 12" corrugated metal pipe to bridge to house temperature monitor between a bridge over the North Anna River at the Louisa-Spotsylvania County line, dated March 24, 1978.

I

5. Commonwealth of Virginia, State Corporation Commission, Approval to construct two 500 kV electric transmission lines and a substation that will extend to Spotsylvania County and into Caroline County, dated January 9, 1973.

6. Commonwealth of Virginia, Department of Highways, Agreement between the State Highway Commissioner of Virginia and VEPCO Concerning Construction, Relocation, and Abandonment of Roads and Bridges in the Primary System of State Highways in the Area of the Proposed

North Anna Reservoir in Louisa and Spotsylvania Counties, Virginia, dated January 9, 1970.

7. Commonwealth of Virginia, Department of Uighways, Agreement between the State Highway Commissioner of Virginia and VEPCO Concerning Construction, Relocation and Abandonment of Roads and Bridges in the Secondary System of State Highways in the Area of the Proposed North Anna Reservoir in Louisa and Spotsylvania Counties, Virginia, dated April 2, 1970, as amended November 4, 1971.

8. Commonwealth of Virginia, Department of Health, Divi-sion of Water Programs, Approval for the water line ex-tensions at the North Anna Power Station's Training Center located in Louisa County, Virginia, dated June 3, 1982.

9. Commonwealth of Virginia, Department of Health, Divi-sion of Water Programs, Amendment to the Waterworks

Operation Permit, dated February 23, 1983.

10. Commonwealth of Virginia, State Air Pollution Control Board, Registration, Section E-1 General Information.

2/28/83 l

i

. . _. .. . .. . _ . . _ . , , . . . - . - - _ _ _ , . . . _ . . , _ - . . _ _ . - . ._,_ x- _ .-__,.x , _ _ .

EXH1 BIT H Page 17 of 29

11. Commonwealth of Virginia, State Air Pollution Control Board, Registration, Section E-2 Fuel Burning Equipment (Except Refuse Disposal). 2/28/83

12. Commonwealth of Virginia, State Air 2ollution Control Board, Registration, Section E-4 Refuse Disposal and Incineration. 2/28/83

13. Commonwealth of Virginia, State Air Pollution Control Board, Registration, Section E-5 Liquid Volstile Organ-ic Compound Storage Tanks, Loading Racks, and Oil -

Water Separators. 2/28/83

14. Commonwealth of Virginia, State Air Pollution Control Board, Registration, Section E-6 Gasoline Service Sta-tion Storage and Handling Facilities. 2/28/83 FEDERAL AGENCIES

1. United States Environmental Protection Agency, Granting Interim Status under Section 3005(e) of the Resource i

Conservation and Recovery Act, dated August 26, 1981.

2. United States Department of Defense, Department of the Army, Authorization to establish six Uniform State Wa-terway Marking System " Underwater Obstruction" bouys in Lake Anna at various locations near Louisa, Louisa ,

County, Virginia, dated July 22, 1974.

3. United States Department of Defense, Department of the Army, Corps of Engineers, Permit to establish 14 Uni-form Waterway Marking System bouys in Lake Anna, dated j April 5, 1974.

PURCHASE ORDERS OF MAJOR COMPONENTS

1. Eberline Instrument Corporation, Purchase a Blanket

order to replace, repair, calibrate and supply spare parts for H.P. radiation detection instrumentation and similar type equipment on an as needed basis for the year 1983, dated January 14, 1983. Order No.

NS-05037-SC.

2. Teledyne Isotopes, Purchase and/or replace TLD ribbons, badges and equipment updates for the Dose Control Pro-gram, dated January 14, 1983. Order No. NS-05036.

i .

EXHIBIT H Page 18 of 29

3. Teledyne Isotopes, Purchase services for the perfor-mance of radio-chemical analysis of environmental sam-ple in connection with operational monitoring program for the year 1983, dated January 18, 1983. Order No.

NS-05085-SC.

4. Westinghouse Electric Corporation, Provide services of two reactor coolant pump specialists to assist in the disassembly and reassembly of Unit 1 "A" and "B" reac-tor coolant pumps and retain the option to include "C" reactor coolant pump, dated September 3, 1982. Order No. 36731-SC.

5. Exide Electronics, Purchase one uninteruptible power supply, dated February 16, 1982. Order No. MPP-53007.

6. Nuclear Energy Service, Design, fabricate and deliver Poison Spent Fuel Storage Racks, dated March 22, 1982.

Order No, MPP-53459.

7. Westinghouse Electric Corporation, Purchase sixteen NAMCO qualified limited switches model no. EA18031303 and two NAMCO qualified limited switches model no.

EA18032303, dated January 20, 1983. Order No.

MP-55687.

8. C. E. Thurston & Sons, Inc., Purchase a Blanket Order for delivery of thermal pioing insulation and other insulating materials, dated January 18, 1983. Order No. NS-05282.

9. Validyne Engineering Corporation, Purchase equipment to upgrade emergency response capabilities, dated June 10, l 1982. Order No. MPP-51434. .

l

10. Westinghouse Electric Corporation, Purchase three 67.2/89.6/112MVA, 65 degrees C, single phase, 60 hert:

l autotransformers, including bushing current transform-

! ers on the H1 and X1 bushing, dated June 10, 1983.

Order No. RC-023666.

11. Babcock and Wilcox, Provide one valve maintenance and five valve actuator courses, dated June 23, 1983.

Order No. RP-51918-SC.

12. Westinghouse Electric Corporation, Purchase four 0-Ring Kit, Bluid Reservoir Assembly, one ring, gland seal, two thermocouples, one board for core subcooling monitoring, two boards, clock count, for the S. S. Pro-tection System, two remote indicators and alarms for the radiation monitoring system, three gear assemblies i

EKHIBIT H Page 19 of 29 for an optical recorder and a Certificate of Conformance, dated June 8, 1983. Order No. NS-06816.

13. Westinghouse Electric Corporation, Purchaso six gaskets for the Radiation Monitoring System, 48 locking cups for the Reactor Coolant Pumps, four seal housings for the Reactor Coolant Pump Seal Assembly, a Certificate of Conformance, dated June 8, 1983. Order No.

NS-06817.

14. Baird Corporation, Supply direct reading gammas and x-ray dosimeters and other radiation detection instru-ments, dated February 10, 1983. Order No. NS-05040.

15. Xerox Corporation, Purchase Xerox 9400 and service contracts dated February 7, 1983. Order No.

NS-05516-SC.

16. Ecodyne Graves Water Division, Purchase of nuclear and non-nuclear resins, dated February 24, 1983. Order No.

NS-05792.

17. Johnston Pump Company, Purchase 12 impellers, two bowl shafts, six lineshafts, two upper headshafts, 8 lock collet impellers, 8 coupling, two bowl assembly, four bearing suction cases, two bearing packing boxes and one Certificate of Conformance for the service water pumps, dated February 24, 1983. Order No. NS-05667.

18. Colt Industries, Purchase parts and a Certificate of Conformance for modifying the emergency diesel genera-tors, dated March 14, 1983. Order No. NS-05937.

19. Babcock and Wilcox, Purchase equipment and provide per-sonnel.to perform eddy current testing and analyses, dated. April 7, 1983. Order No. NS-06093-SC.

20. Eck Supply Company, Purchase miscellaneous electric supplies, dated April 13, 1983. Order No. NS-06148.

21. Westinghouse Electric Corporation, Purchase equipment for the APDMS and the radiation monitoring system, dated April 20, 1983. Order No. NS-06206.

22. Westinghouse Electric Corporation, Purchase a floating ring cartridge for the Reactor Coolant Pump, dated April 26, 1983. Order No. NS-06042.

23. Westinghouse Electric Corporation, purchase equipment for the Nuclear Instrumentation System, for the Core Subcooling Monitor and for the Reactor Coolant Pump, dated March 24, 1983. Order No. NS-05996.

1

EXH1 BIT H Page 20 of 29

24. Electrical Equipment, Purchase labor and materials for the repair of Westinghouse, General Electric, Lim-itorque and other miscellaneous motors, dated February 8, 1983. Order No. NS-05506-SC.

25. Dona *d Adams, Purchase number 2 heating fuel, dated February 8, 1983. Order No. NS-05595-SC.

26. Colt Industries, Cover field service representative ex-penses and labor for routine and emergency repairs of the emergency diesel generators, dated February 22, 1983. Order No. NS-05599-SC.

27. Westinghouse Electric Corporation, Provide and furnish the services to replace the thermocouple instrument port female flange, dated March 25, 1983. Order No.

NS-05960-SC.

28. CII Service, Inc., Purchase a Blanket Order to cover emergency service, miscellaneous parts and maintenance inspections for air conditioning, heating, ventilating and refrigeration equipment, dated March 28, 1983.

Order No. NS-06032-SC.

29. Westinghouse Electric Corporation, Purchase service to inspect the low pressure turbines, dated March 25, 1983. Order No. NS-05992-SC.

30. The Computer Company, Purchase monthly rental of APL Computer Timesharing, dated May 5, 1983. Order No.

NS-06419-SC.

31. Weed Instrument Co., Inc., Purchase Narrow and Wide range RTD's, dated May 20, 1983. Order No. MP-55791.

32. Westinghouse Electric Corp., Purchase various Seal As-sembly and Reactor Coolant Pump equipment, dated 8/31/83.

33. Westinghouse Electric Corp., Purchase Computer and In-strumantation Equipment, Port Seal Load Assembly Equip-ment and Throttle Valve Switch Linkage, dated August 9, 1983. Order No. NS-07150.

34. Westinghouse Electric Corp., Purchase equipment for the Reactor Coolant Pumps, dated July 28, 1983. Order No.

NS-07062.

35. Westinghouse Electric Corp., Purchase Boards, Tool, Dovetale Punch, Pin, Throttle Valve and Seat Valve, dated August 8, 1983. Order No. NS-07155.

w,, -

~ '  %

EXHIBIT H Page 21 of 29

36. Liebert Corporation, Purchase one non-locking type dis-connect switch, dated May 3, 1982. Order no.

MPP-53342.

37. Brown Boveri Electric, Inc., Purchase one motor control center, dated February 18, 1982. Order No. MPP-52785.

38. Anaconda-Ericsson, Inc., Purchase 12,500 Lf, 300 volt instrument cable, single pair no. 20 stranded copper conductor with overall shield and 17,500 Lf, 600 volt fire resistant control cable, 8 conductors, 4 pairs, no. 20 stranded cooper conductor with overall shield, dated October 11, 1982. Order no. MPP-55278.

39. Rochester Instrument Systems, Inc., Furnish and deliver nine station battery monitors, four Certificates of Conformance, four seismic test reports, five complete sets of reproductible manufacturing drawings and five installation and maintenance instruction manuals, dated December 30, 1982. Order No. MP-55662.

40. Valcor Engineering Corporation, Furnish and deliver two 3/4" solenoid operated valves, ten sets of operation / maintenance manuals and physi-cal / chemical / mill test reports, dated December 20, 1982. Order no. MPP-55608.

41. Namco Controls Division, Furnish and deliver limit switches to North Anna Power Station, dated September 7, 1983.

CONTRACTOR AGREEMENTS

1. Atlantic Nuclear Services, Inc., Craft Support-Mechanical and Electrical, t/a Atlantic Power Services, March 1, 1983.

2. Battelle Memorial Institute (Columbus Laboratories),

Mechanical components failure analysis, dated May 21, 1981.

3. Black and Veatch, Consulting, February 13, 1981.

4. R. L. Bowman Corporation, Craft Support-Electrical, March 1, 1983.

5. Cooperheat, Stress relieving, September 1, 1981.

EXHIBIT E Page 22 of 29

6. Crane-Mit, Inc., Crane and hoist maintenance, February 1, 1981. (Amended).

7. Global Erectors, Incorporated, Construction, January 9, 1982.

8. Institute for Resource Management, Inc., Health Phys-ics, March 1, 1982.

9. NUS Corporation, Consulting, December 1, 1982.

10. Stone & Webster Engineering Corporation, Consultant, Engineers and Constructors. January 11, 1966, as amended.

11. United Insulation, Inc., Craft Support-Insulators, June 1, 1981.

12. Varina Electric Company, Inc., Craft Support-Electrical, May 15, 1981.

13. Virginia Corporation of Richmond, Non-Destructive Exam-ination, December 31, 1981.

14. WACO, Inc., Craft Support-Mechanical and Electrical and Insulation, March 1, 1983.

15. World Contract Stress Corporation, Inc., Stress Relieving, September 1, 1981.

16. Chem-Nuclear Systems, Inc., Rad. waste, March 1, 1983.

17. Dive Scan, Incorporated, November 23, 1982.

18. Fire Protection Equipment Company, Fire Suppression, October 1, 1982. (Amended).

19. Fruin-Colnen Corporation, Construction Services, November 1, 1982. (Amended).

l

20. Furmanite America, Inc., April 1, 1983.

21. Insulation Specialties, Inc., Insulation Services, January 1, 1983.

22. Leak Repairs, Inc., Steam / Process Leak Repair Services, April 1, 1983.

23. Carter Machinery, Preventive Maintenance, May 1, 1982.

EXHIBIT H Page 23 of 29

24. Burns International Security, Inc., Contract and Letter of Authorization, dated April 1, 1983.

25. Nuclear Assurance Corporation; Agreement for Con-sulting, Technical, Engineering and Associated Ser-vices; Vepco Contract Number 9793 dated November 23, 1982 (furnishing of consulting, technical, engineering and associated services relating to determining the physical integrity of Vepco's nuclear fuel at its nu-clear power stations.)

26. Nuclear Audit and Testing Company; Agreement for Con-sulting, Technical, Engineering and Associated Ser-vices; Vepco Contract No. 6254 dated November 1, 1981 (furnishing of consulting, technical, engineering, and associated services relating to Vepco's nuclear activi-ties.)

27. NUS Corporation; Agreement for Consulting, Technical, Engineering and Associated Services; Vepco Contract No.

9405 dated October 1, 1981 (furnishing of consulting, technical, engineering and associated services relating to the operation, support and licensing of Vepco's nu-clear power plants).

28. UUSAC, Incorporated; Agreement; Vepco Contract No. 7830 dated January 18, 1982 (furnishing of consulting, tech-nical, engineering and associated services relating to Vepco's nuclear quality assurance and safe-guards / security activities.)

29. Energy Incorporatad; Agreement for Engineering and Re-lated Services; Vepco Contract No. 8786 dated October 26, 1979 as amended June 6, 1981 (fprnishing of analy-sis, engineering, quality assurance, design review and evaluation and other services concerned with nuclear power plants, and engineering support and consultation during regulatory and licensing hearings.)

30. Control Date Corporation; Agreement for Nuclear Engi-neering and Licensing Services; Vepco Contract No. 9142 dated October 31, 1980 (furnishing of nuclear engineer-ing and licensing services cennnected with the operation of Vepco's nuclear power plants.)

31. Agreement for Consultant Services for Human Factors En-gineering for NUREG 0696 Short Term I&C Project Surry and North Anna Nuclear Power Stations betwen Virginia Electric and Power Company and Advanced Resource Devel-opment Corporation, dated July 7, 1981. Contract No.

PSE-160.

EXHIBIT H Page 24 of 29

32. Agreement for Consulting Services (Nuclear) between Virginia Electric and Power Company and ARD Corpora-tion, dated February 11, 1983. Contract No. PSE-201.

33. Agreement for Engineering Services (Nuclear) Control Room Design Review NUREG 0700 - Phase I - Planning be-tween Virginia Electric and Power Company and ARD Cor-poration, dated July 1, 1983. Contract No. PSE-220.

34. Agreement for Consultant Services for Hardware / Software Verification and Validation for NUREG 0696 Short Term I&C Project Surry and North Anna Power Stations between Virginia Electric and Power Company and Science Appli-cations, Inc., dated July 7, 1981. Contract No.

PSE-165.

35. Letter Contract PSE-191 Verification of the Acoustic Coverage Early Warning System at Surry and North Anna Power Stations between Virginia Electric and Power Com-pany and Acoustic Technology, Inc., dated June 18, 1982.

36. Letter Agreement between Virginia Electric and Power Company and Alexander Kusko, Inc. (consultant) for the conduct of an investigation by consultant of the fail-ure of seven (7) generator transformers for North Anna Units No. 1 and 2, dated March 9, 1983. Contract No.

PSE-202.

37. Letter Contract PSE-198 between Virginia Electric and Power Company and Quadrex Corporation, Project Alterna-tive Study, Flow Splitter Removal North Anna Units 1 and 2, dated October 1, 1982.

> 38. Letter Contract PSE-206, Consulting Services, Steam

( Generator Blowdown Recovery Study, North Anna Power l Station, dated May 24, 1983.

39. Agreement for Software Support Services between Virginia Electric and Power Company and JBA, Inc.,

dated January 1, 1982.

40. Contract No. FHN-198-0154 Technical Assistance between Virginia Electric and Power Company and General Dynam-l ics Corporation (Electric Boat Division) for Reactor Plant Services, dated May 16, 1983.

41. Agreement for Liaison Services between Virginia Elec-( tric and Power Company, Power Operations Department and John M. Nedderman, dated September 1, 1982.

EXHIBIT H Pags 25 of 29

42. Proposal for " Reactor Fundamentals for Nuclear Operations Personnel" Phase I Contract Agreement, be-tween Virginia Electric and Power Company and North Carolina State University, dated February 24, 1982.

43. Contract between Virginia Electric and Power Company and Wilson Tree Company, Incorporated, to perform work as set forth in exhibits, plans, specifications, let-ters of authorization and any additional work authori-zations, dated May 14, 1979.

44. Otis Service Agreement to provide service on certain elevator equipment at the North Anna Power Station, dated February 14, 1978.

45. Agreement between Virginia Electric and Power Company and Hittman Nuclear & Development Corporation for Processing, Transportation and Disposal of Radioactive Waste, North Anna and Surry Nuclear Power Stations, dated March 1, 1983.

46. Otis Extended Coverage Maintenance Agreement for cer-tain services on elevator equipment at the North Anna Power Station, dated December 31, 1977.

47. Agreement for Engineering Services Work at Nuclear Projects Between Virginia Electric and Power Company (Power Station Engineering and Construction) and NUS Corporation, dated October 29, 1980.

48. Agreement for Engineering Services Work at Nuclear Projects Between Virginia Electric and Power Company (Power Station Engineering and Construction) and J. E.

Sirrine Company of Virginia, Inc. dated, November 5, 1980.

49. Master Agreement for Engineering Services Work at Nu-clear Projects Between Virginia Electric and Power Com-pany (Power Station Engineering and Construction) and Bechtel Power Corporation and Bechtel Association Pro-fessional Corporation (Virginia), dated May 26, 1981.

50. Agreement for Engineering Services Work at Nuclear Projects Between Virginia Electric and Power Company (Power Station Engineering and Construction) and Gilbert Associates, Inc. and Gilbert Associates of Virginia, Inc., dated December 22, 1980.

51. Agreement for Engineering Services Work at Nuclear Projects Between Virginia Electric and Power Company (Power Station Engineering and Construction) and Sargent & Lundy, dated March 9, 1981.

e

- v w '-

EXEIBIT H Page 26 of 29

52. Master Agreement for Engineering Consultant Services Between Virginia Electric and Power Company and Queue Systems, Incorporated, dated December 31, 1981.

53. Agreement for Engineering Services Work at Nuclear Projects Between Virginia Electric and Power Company (Power Station Engineering and Construction) and EDS Nuclear, Inc., dated December 2, 1981.

54. Master Agreement for Engineering Services Work at Nu-clear Projects Between Virginia Electric and Power Com-pany (Power Station Engineering and Construction) and Stone & Webster Engineering Corporation and S&W of Virginia, Inc., dated May 17, 1982.

55. Master Agreement for Engineering Services Work at Nu-clear Projects Between Virginia and Electric and Power Company (Power Station Engineering and Construction) and Nuclear ?ower Services, Inc.

56. Contract for Engineering Consulting Services Between Virginia Electric and Power Company and Earthquake En-gineering Systems, Inc., dated October 13, 1980.

INDEMNITY AGREEMENT

1. North Anna Power Station, Unit Nos. 1 and 2, Indemnity Agreement No. B-80, dated April 15, 1976.

2. North Anna Power Station, Unit Nos. 1 and 2, Amendment No. 4 to Indemnity Agreement No. B-80, dated October 10, 1978.

3. North Anna Power Station, Unit Nos. 1 and 2, Amendment No. 5 to Indemnity Agreement No. B-80, dated May 18, 1979.

4. North Anna Power Station, Unit Nos. I and 2, Amendment No. 6 to Indemnity Agreement No. B-80, dated October 31, 1979.

5. North Anna Power Station, Unit Nos. I and 2, Amendment No. 7 to Indemnity Agreement No. B-80, dated April 18, 1980.

EXHIB1T E Page 27 of 29 INSURANCE POLICIES

1. Nuclear Property Insurance, American Nuclear Insurers (ANI), dated March 1, 1983. This policy provides $500 million of primary property protection for all owned properties or properties to which the Company is lia-ble.

2. Excess Nuclear Property Insurance, Nuclear Electric In-surance Limited, dated November 15, 1982. The policy protects to $415 million to which the Company is liable in excess of the primary policy described above.

3. Excess Nuclear Property Insurance, ANI, dated March 1, 1983. This policy provides $68 million of protection exactly like that which is provided under the NEIL pol-icy outlined above.

4. Excess Nuclear Property Insurance - Harbor, dated September 15, 1983. This policy follows the form of the previous policy and provides an additional $5 mil-lion of coverage.

5. Nuclear Liability Insurance - American Nuclear Insur-ers, dated January 1, 1983. This policy provides $160 million of protection against third party claims arising from a nuclear incident.

6. Suppliers and Transporters - American Nuclear Insurers, dated January 1, 1983. This policy provides $25 mil-lion of liability protection arising from nuclear inci-dents that may be attributable to the Company's negli-gence while away from the site, other than an indemni-fied facility.

7. Extra Expense - NEIL, dated September 15, 1983. This policy provides protection against additional operating costs arising from an accident on site which results in interruption in service. Insurances protection pro-vides up to $2.5 million per week after a 26 week waiting period for a period of one year and then an ad-ditional one year period of $1.25 million per week.

8. Nuclear Transportation - ANI, dated March 1, 1983.

This policy provides for protection against loss or damage to nuclear fuel elements while in transit from the vendor to the site.

9. General Liability (Excess) - AEGIS, dated April 30, 1983. This provides general protection from accidents arising from other than nuclear events claimed by third i

1 EXHIBIT E '

Page 28 of 29 '

parties with' a limit of $25 million or a $250,000 retention.

10. Automobile Liability dated January 1, 1983. This poli-cy provides protection against third party claims arising from automobile accidents. This policy pro-vides protection for all Vepco licensed vechicles whether owned, leased or hired.

11. Blanket Crime Policy - Home Insurance Company, dated May 1, 1983. This policy provides protection for the Company against criminal acts of employees with the maximum liability of $10 million excess of a $10 thou-sand retention. This policy is applicable to all em-ployees at North Anna.

12. Arkwright - Boston - Property Policy covering all properties located outside security fence at North Anna Nuclear Power Station, dated October 1, 1983.

AGREEMENTS INVOLVING AMOUNTS LESS THAN $50,000

. All contracts, purchase orders and other similar docu-ments and agreements involving lesc than $50,000 to which Vepco is a party and which concern the Facilities shall be deemed included in this Appendix as if specif-icall' set forth.

MASTER AGREEMENTS

1. Agreement for Nuclear Equipment and Services between Virginia Electric and Power Company and Westinghouse Electric Corporation for the Surry Units 1 and 2, dated February 1, 1974, as amended April 24, 1978.

2. Uranium Agreement of Settlement between Virginia Slec-tric and Power Company and Westinghouse Electric Corpo-ration, dated June 22, 1979, with Attachments (Exhibits A-G).

3. Exhibit A, Agreement for Specialized Engineering, Li-censing and Analytical Services between Virginia Elec-tric and Power Company and Westinghouse Electric Corpo-ration for the Surry and North Anna Power Stations Units No. 1 and 2, dated June 22, 1979.

~

EXHIBIT H Page 29 of 29

4. Exhibit B, Amendment No. 5 to Fuel Contract between Virginia Electric and Power Company and Westinghouse Electric Corporation for Surry Power Station Unit No. 1 and Unit No. 2, dated June 22, 1979.

5. Exhibit C, Amendment No. 3 to Fuel Contract between Virginia Electric and Power Company and Westinghouse Electric Corporation for North Anna Power Station Unit No. 1 and Unit No. 2, dated June 22, 1979.

6. Exhibit D, Agreement for Uranium Supply between Virginia Electric and Power Company and Westinghouse Electric Corporation, dated June 22, 1979.

7. Exhibit E, Agreement for Burnable Poison Assembly Sup-ply between Virginia Electric and Power Company and Westinghouse Electric Corporation for the North Anna Power Station Unit No. 1 and No. 2, dated June 22, 1979.

8. Exhibit F, Agreement for Turbine Rotors and Storage be-tween Virginia Electric and Power Company and Westinghouse Electric Corporation for the North Anna and Mount Storm Power Stations Units No. I and No. 2, dated June 22, 1979.

9. Exhibit G, Agreement for Mobile Static Exciter between Virginia Electric and Power Company and Westinghouse Electric Corporation, dated June 22, 1979.

10. Agreement for Materials, Equipment and Services between i

Virginia Electric and Power Company and Westinghouse Electric Corporation, dated April 29, 1983.

11. Westinghouse Electric Corporation, Westinghouse 1983 l Settlement Agreement, May 13, 1983.

l l

l l

Page 1 of 7 EXHIBIT I Form of Bill of Sale THIS BILL OF SALE, dated as of the day of

, 1983, between VIRGINIA ELECTRIC AND POWER COMPANY, a Virginia public service corporation ("Vepco"), and OLD DOMIN-ION ELECTRIC COOPERATIVE, a Virginia generation and transmis-sion cooperative ("Old Dominion"), recites and provides as fol-lows:

RECITALS:

1. By a Purchase, Construction and Ownership Agreement dated as of December 28, 1982, but amended and restated on October 17, 1983 (the " Purchase Agreement"), between Vepco and Old Dominion, Vepco agreed to sell certain real and personal property to Old Dominion.

l 2. Pursuant to the Purchase Agreement and simulta-l neously with the delivery of this agreement, Vepco has conveyed to Old Dominion by a deed dated , 1983 (the

" Deed"), an 11.6 percent undivided interest in a tract or par-cel of land located in the Counties of Louisa, Orange and Spotsylvania, Virginia, known as the North Anna Nuclear Power Station and more particularly described in the Deed.

f EKEIBIT I Page 2 of 7

3. The Purchase Agreement together with an Interconnection and Operating Agreement dated as of December 28, 1982, but amended and restated on October 17, 1983, between Vepco and Old Dominion and a Nuclear Fuel Agreement dated as of December 28, 1982, but amended and restated on October 17, 1983, between Vepco and Old Dominion are attached to the Deed and recorded therewith in the Clerk's Office of the Circuit Court of the Counties of Louisa, Orange and Spotsylvania, Virginia. ,

4. Vepco now desires to sell, convey and transfer to Old Dominion an undivided percentage interest in the hereinaf-ter described personal property.

AGREEMENT:

NOW, THEREFORE in consideration of the sum of Ten Dol-lars ($10), the premises contained herein and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, Vepco, subject to the matters herein-after set forth, hereby sells, transfers, grants, sets over, conveys and assigns to Old Dominion the undivided percentage interest of all the right, title, interest, estate and benefit of Vepco in and to the personal property listed on the attached Appendix A (the " Personal Property") that is equal to the undi-vided percentage amount designated on Appendix A for the af-fected component of the Personal Property (but expressly ex-cepting from the Personal Property the personal property listed

~ EXHIBIT I Page 3 of 7 on the attached Appendix B), together with the undivided percentage interest of all the right, title, interest, estate and benefit of Vepco in, to and under all gur.rantees and warranties given heretofore with respect to (i) the construc-tion of the Facilities, (ii) the Personal Property, and (iii) the performance and quality of the workmanship and the quality of materials supplied with respect to the construction and operation of the Facilities (collectively, the " Guarantees")

that is equal to the Old Dominion Ownership Interest from time to time (aggregated, if necessary) in the component covered by the Guarantee (s).

The Personal Property and the Guarantees herein sold and transferred are expressly subject to the provisions for Waiver of Partition set forth in Article X of the Purchase Agreement and all exceptions, reservations, easements, waivers, conditions, licenses, restrictions, encumbrances, covenants, agreements, limitations and waivers that may apply to the Per-sonal Property or the Guarantees or any portion, part or item thereof, including but not limited to, the provisions of the Basic Agreements.

Old Dominion has joined in the execution hereof to evi-dence that it hereby (i) assumes its proportionate share of all the duties and obligations arising from or in any way related to the ownership of the Personal Property or the Guarantees that is equal to Old Dominion's Percentage Ownership Interest

EXEiBZT I I Page 4 of 7 from time to time (aggregated, if necessary) in the affected component of the Per sonal Property and (ii) agrees to fully perform all such duties and obligations.

Terms used herein and defined in the Purchase Agree-ment, but not otherwise defined herein shall be deemed to have the meanings specified in the Purchase Agreement.

The provisions of this Bill of Sale shall inure to the benefit of and be binding upon the successors and assigns of the parties hereto.

IN WITNESS WHEREOF, Vepco and Old Dominion have caused this Bill of Sale to be executed, and their respective corpo-rate seals to be hereunto affixed and attested, by their re-spec tive duly aut horized corporate officers.

VIRGINIA ELECTRIC AND POWER COMPANY a Virginia public service corporation l By:

Vice President t

(SEAL]

Attest:

l l

Assistant Corporate Secretary l

I l

l

. . _ . - _ - _ _ _ . . _ - . ~__ . _ _ _ _ - . . . . . - _ - _

EXHIBIT I Paga 5 of 7 OLD DOMINION ELECTRIC COOPERATIVE, a Virginia generation and transmission cooperative By:

4 President (SEAL]

4 Attest:

Secretary i

4 4

i

(

l i

l

! i l

l l

l I

i

_. ~ ,, -. .. - - - . . . . , - . . _ - . . . . .-- _._ - , , ,- - _ -._. ,_, ,.-.._._._- ---.. _ - _ . _ _ _ _ _ _ . - . _ _ , .

P EXEIBIT I Page 6 of 7 Appendix A Appendix A to Bill of Sale dated _ , 1983 between Ve_oco and Old Dominion (Description of the Personal Property)

Description of Percentage

, Items of Personal Amount Sold Property to Old Dominion I

l a

1

- -~ , --

, , - . - , , , , , . , _ , .,,-.p-.-7,.-g --.-, - . , ,, ,, .,,., . - .,,- - - .- e., ,,,,4 n, ,,, , ,,. . . ,, - - -e,- , , . , , , ,,- , --, - ,,- , , -

EXHIBIT I Page 7 of 7 Appendix B Appendix B to Bill of Sale dated , 1983 4

between Vepco and Old Dominion

[ Excepted Personal Property]

I j

J J

l i

I l

e

. , , . , . .,-,p.. -,_,y,,-,, , - - - - , - --,, _ , , , , - - . _ , ., , _ , _ ,,..,,r, , , , .,,_,_-,n,.,, ,,,- p.,,y,,,,,,,,,,,y,,,,,,e., -

, - , , -nm.,_w ,_w e ,_ y- ww w e-,,.__,_,.w.-

Page 1 of 17 EXHIBIT J Form of Purchase Monev Second Deed of Trust THIS PURCHASE MONEY SECOND DEED OF TRUST, dated as of

, the day of , 1983, between OLD DOMINION ELEC-TRIC COOPERATIVE, a Virginia generation and transmission coop-erative (the " Grantor"), and , a resident of the of , Virginia, as trustee hereunder (the "Trustoe"), recites and provides:

RECITALS:

By a Purchase, Construction.and Ownership Agreement dated att of December 28, 1982, but amended and restated on October 17, 1983, (the " Purchase Agreement"), the Grantor agreed to acquire and Virginia Electric and Power Company, a Virginia public service corporation ("Vepco"), agreed to sell, among other things, an 11.6 percent undivided interest in cer-

> tain real property, briefly described as Vepco's North Anna Nu-clear Power Station, situated in the Counties of Louisa, Orange and Spotsylvania, Virginia, and more particularly described in Schedule A, which is attached hereto and made a part thereof i

(the "Real Estate"), in accordance with the terms and condi-l tions set forth in the Purchase Agreement.

I r

i

._ . ~ _ _ _ _ _ _ _ _ - . . . ~ _ _ _ _ _ _ _ _ _ _ __ _ _ _ - - - . - - . _ _ - - - , _ _ _ _ . .

EEHIBIT J Page 2 of 17 By a Nuclear Fuel Agreement dated as of December 28, 1982, but amended and restated on October 17, 1983 ( the,. "Fue l Agreement"), Vepco ac reed to sell and the Granter agreed to

~

purchase an undivided interest in certain nuclear fuel upon the terms and conditions specified in the Fuel Agreement.

Collectively, the Purchase Agreement, and the Fuel Agreement together with an Interconnection and OperaEing Agree- ,

ment dated as of December 28, 1982, but amended and restated on

. October 17, 1983, between Vepco and the Grantor (the

" Interconnection Agreement") are hereinafter rAferred to as the

" Basic Agreements".

TheGrantorhasnowacquirebownershipoftheRealEs-tate pursuant to the Purchase Agreement hrom Vepco by a deed of even date (the " Deed") recorded in the Clerk's Office of the Circuit Court of the Counties of Louisa, Orange and Spotsylvania, Virginia, and copies of the Basi Agreements are attached to the Deed and recorded therewith.

( The Purchase Agreement, the Interconnection Agreement 1

, and the Nuclear Fuel Agreement recorded, immediately prior-hereto, in the Clerk's Office of the Circuit Court of this County as attachments to the Deed are. incorporated by reference herein as if set forth in full.

i Immediately prior hereto, the Grantor has conveyed the Real Estate by a deed of trust dated as of __, 1983 (the "First Deed of Trust" , to ' '

[and

, ], as Trustee (s], in trust to secure the l

payment of the obligations more fully described therein.

i

EKHIBIT J Page 3 of 17 Pursuant to the Purchase Agreement, the Grantor now de-sires to convey the Real Estate in trust to secure to the Bene-ficiary the matters hereinafter set forth, including, but not limited to, certain purchase money second deed of trust promis-sory notes, dated __, 1993, from the Grantor to Verco (the " Notes").

DEED OF TRUST NOW, THEREFORE, the Grantor hereby grants and conveys

the Real Estate to the Trustee subject to the lien of the First Deed of Trust, with special warranty. This conveyance is sub-ject to all existing exceptions, reservations, easements, con-ditions, restrictions, encumbrances, covenants, agreements, limitation and waivers that may apply to the Property or any part theroof, including but not limited to, the Permitted En-cumbrances, the provisions for Waiver of Partition set forth in Article X of the Purchase Agreement and all of the provisions of the Basic Agreements.

TOGETHER WITH all buildings, improvements, equipment, furniture, furnishings and fixtures now or hereafter erected thereon, all insurance claims, rights, appurtenances, ease-ments, privileges, remainders and reversions appertaining thereto.

FURTHER, TOGETHER WITH all of the Grantor's right, I

title and interest in and to all articles of personal property now or hereafter attached to or used in connection with the Real Estate (the " Personal Property").

EXEIBIT J Page 4 of 17 e

1 FURTHER, TOGETHER WITH (but subject to the provisions  !

hereof) any and all awards and refunds heretofore or hereafter made by any federal, state, county, municipal or other govern-mental authority, or by whomsoever made in any condemnation proceedings whatsoever to the present or subsequent owners of the Real Estate for the acquisition of the Real Estate or any portion thereof, any interest therein, or use thereof for pub-lie or other purposes authorized by statute or for consequen-tial damages on account thereof, including any award for any change of grade of roads affecting the Real Estate, and also any award for any damage to the Real Estate; and all of such proceeds, awards and refunds are hereby assigned to Vepco, its successors and assigns (the " Beneficiary"), with the power to pursue, collect, receive and apply the same as provided for herein, subject to the provisions hereof, whether or not then

-due and payable. The Grantor shall execute all additional in-struments reasonably necessary to perfect this assignment or to substitute or add the Beneficiary as petitioner in any such E

proceeding.

l 'FURTHER, TOGETHER WITH all leases now existing and those hereafter made, whether verbal or written, of or relating to the Real Estate (the " Leases"), together with all rents, is-sues, profits, revenues, royalties, rights of contract and oth-l erwise, and benefits arising from the Real Estate, including, i

l but not limited to, any deposits of cash, securities and prop-i l

erty which may be held at any time and from time to time under l

- -- ., - _ - , - . . - - - -. ._ -. . _ . _ - . . ~ _ . - _ . . - - - - - . - _ . - - - _ . -

EXHIBlT J Page 5 of 17 the terms of the Leases; provided, however, that such assignment shall not constitute a surrender by the Grantors of the Leases and such rents, issues, profits, revenues, royal-ties, rights of contract and otherwise until an Event of De-fault hereunder (as hereinafter defined), but such rents, is-sues, profits, revenues, royalties, rights of contract and oth-erwise, notwithstanding such assignment, may be exercised or enforced by the Grantors until such Event of Default.

FURTHERMORE. this Deed of Trust shall constitute a se-curity agreement pursuant to the provisions of Title 8.9 of the Code of Virginia 1950, as amended.

IN TRUST to secure (i) the performance by the Grantor of the covenants, agreements, terms, conditions and warranties contained in the Notes and this Deed of Trust, and (ii) the payment of all amounts due to the Beneficiary from time to time under the Notes and this Deed of Trust.

1. Covenants of the Grantor.

So long as the Grantor is obligated to perform pur-suant to the Notes and this Deed of Trust, the Grantor cove-nants and agrees as follows:

(a) Performance of Covenants. The Grantor shall at all times fully perform and comply with all covenants, agreements, terms, conditions and warranties contained in the Notes and this Deed of Trust.

EXHIBIT J Page 6 of 17 (b) Compliance with Governmental Regulations. The Grantor shall comply with all statutes, ordinances, regula- ,

tions, rules and requirements of any governmental authority relating to the Real Estate or any part thereof; any improve-ments thereon now cr hereafter existing; or the Grantors operations thereon.

(c) Eminent Domain. In the event that any pro-ceedings to take the Real Estate or any part thereof by exer-cise of the power of eminent domain are undertaken or threatened or in the event of the sale thereof to a proposed condemnor to avoid the exercise of the power of eminent domain, the Grantor shall give the Beneficiary prompt notice thereof./\

Any award resulting from exercise of the power of eminent do-main shall be paid in proportion to the respective interests of the Grantor and Beneficiary in the Real Estate being taken and in accordance with the First Deed of Trust.

(d) Further Docurentation. The Grantor shall, at the Grantor's expense, execute,-deliver, file and record such e

security agreements, assignments, notices of assignments, fi-nancing statements and other documents as the Beneficiary may reasonably require in order to confirm or perfect its interest l in the Real Estate and the Personal Property.

I

( (e) Costs of Litigation. The Grantor shall pay l upon demand all expenses incurred or paid by the Beneficiary or l the Trustee (including, but not limited to, reasonable l

attorneys' fees and court costs) on account of any litigation l

l l

l I

EKEIBIT J Page 7 of 17 which may arise in connection with enforcing the provisions of this Deed of Trust or on account of any attempt without litiga-tion to enforce the terms of this Deed of Trust.

(f) Notice of Default Under First Mortgage. Upon any default by Grantor in the payment of money under the First Deed of Trust, Grantor shall promptly give Beneficiary written notice of such default and Beneficiary shall have the right to cure such default.

2. Reoresentations and Warranties of the Grantor.

(a) The Grantor represents and warrants (i) that the Grantor is duly incorporated and in good standing under the laws of the Commonwealth of Virginia, with all requisite corpo-rate power and authority under such laws to own and operate the Real Estate and the Personal Property and to enter into the Notes and this Deed of Trust.

(b) The Grantor represents and warrants that it has taken all action necessary to authorize (i) the execution of the Notes and this Deed of Trust, and (ii) the performance by the Grantor of all of its obligations under the Notes and this Deed of Trust.

(c) The Grantor represents and warrants that the execution and delivery of the Notes and this Deed of Trust, and 1

the performance of the terms and provisions of the Notes and L this Deed of Trust will not conflict with or violate, or con-l t

j stitute a default or require any consent or waiver under, any l

provision of any mortgage, deed of trust, indenture, evidence l .

i

EXHIBIT J Page 8 of 17 of indebtedness, order, decree or agreement to which the Grantor is a party or by which the Grantor is bound.

3. Events of Default. Each of the following shall-be an event of default (an " Event of Default") hereunder:

(a) Any failure to satisfy Grantor's obligations under the Notes or this Deed of Trust;gprovided, j however, that Beneficiary agrees that, within a 90 day period after the oc-currence of the original default it shall not exercise its rightsunderthisDeedofTrustifandsolongaptheBenefi-ciary has been provided with satisfactory assurances the bene-ficiary under the First Deed of Trust is pursuing all reason-able steps to provide for the payment of any amounts, including interest, owing to the Beneficiary during the period of de-fault, not lator than 225 days after the commencement of the Event of Default; (b) Any default under Section 15.01(c) of the Pur-chase Agreement; (c) If any third party shall cause such accelera-tion as described in the last sentence of Section 15.04 of the Purchase Agreement.

If any Event of Default under Paragraph 3(a) of this Deed of Trust shall have occurred, the entire amount owing under the Notes and this Deed of Trust, together with any ac-crued and unpaid interest thereof, may, at the election of the Beneficiary and subject to the proviso in Section 3(a), become immediately due and payable without the necessity of any action v

EXHIBIT J Page 9 of 17 ,

by the Beneficiary. If an Event of Default under Paragraphs 3(b) or 3(c) of this Deed of Trust shall have occurred, the en-tire amount owing under the Notes in this Deed of Trust, to-gether with any accrued and unpaid interest thereon, shall be-come immediately due and payable without the necessity of any action by the Beneficiary.

4. Advances. The Beneficiary may advance funds for and otherwise cause the performance of any covenant, agreement, term, condition and warranty set forth, in the Notes and this Deed of Trust;a and if the Beneficiary advances such funds, such funds shall be payable by the Grantor to the Beneficiary on de-mand, shall bear interest at the Special Interest Rate as defined in the Purchase Agreement and shall be secured hereby.

5. Remedies of the Beneficiary Uoon an Event of Default. Upon the occurrence of any event which would be an Event of Default under Secticn 3(b) or 3(c) hereof, or any

, event which,fupon lapse of time, woulggallowaccelerationof i

all amounts due under Section 3(a) hereof, the Beneficiary may, at its option fourteen days prior to any such event becoming an Event of Default or becoming accelerated, as the case may be, i

l give the notice required by subsection (a) below and then, upon i such occurrence becoming an Event of Default or permitting ac- "

celeration, exercise any or all of the remedies described below l or provided by the Basic Agreements or law. Any delay in exer-cising or failure by the Beneficiary to exercise any such reme-dy shall not be deemed a waiver of any Event of Default or of

EXHIBIT J Page 10 of 17 the right of the Beneficiary later to exercise any such remedy.

In the event of any failure to make any such payments on demand to the Beneficiary, such failure, at the option of the Benefi-ciary, shall constitute an Event of Lsfault hereunder.

(a) Sale of Real Estate at Foreclosure. Upon fourteen (14) days notice.(unless a longer period is required by law, in which event such notice required by law shall be '

given), the Beneficiary shall have the right to have the Trus-tee take possession of the Real Estate and proceed to sell the same as a whole or in part, at public auction, for cash or credit, upon any terms the Trustee shall deem appropriate, and to have.the Trustee take any or all other actions set forth herein and in the Basic Agreements. Before such sale of the Real Estate at piblic auction is made, there shall first be ad-vertisement of the time, place and terms of such sale at least four (4) times in a newspaper of general circulation in the city or county in which the Real Estate is situated. The Bene-ficiary may become the purchaser of the Real Estate or the por-tion thereof so sold and, except as may be otherwise provided by Section 58-762 of the Code of Virginia, no purchaser shall be required to see to the proper application of the purchase money. The proceeds of any such sale shall be applied in the manner required by Section 55-59.4(a)(3) of the Code of Virginia, or any successor provision of law. The Trustee shall have the right, exercisable in its discretion, to postpone such sale of the Real Estate.

EXHIBIT J Page 11 of 17 (b) Right to Enter and Take Possession. The Bene-ficiary shell have the right to direct the Trustee to enter the Real Estate and take possession thereof in its name or in the name of the Beneficiary, and the Grantor agrees to surrender the Real Estate to the Trustee peacefully and promptly upon de-i mand. Upon so entering and taking possession of the Real'Es-

+

tate, the Trustee shall have t e right (but not be obligated) to perform any one or more of the covenants, agreements, terms, conditions and warranties under the Notes, the Basic Agree-ments, this Deed of Trust or the First Deed of Trust that the Beneficiary deems necessary or desirable to protect the lien hereof; to manage and operate the Real Estate or any part thereof itself or through agents appointed by it; to make re-

-pairs and alterations, and do any acts that the Beneficiary or the Trustee deems necessary or desirsble to protect the Real Estate; and, upon the direction of the Beneficiary, to sue for or otherwise collect all rents, issues, profits, revenues, roy-alties, rights of contract and othervise from the Real Estate, including those past due and unpaid, deduct from such income from the Real Estate all costs of entry, of collection, of ad-i j ministration and reasonable management and counsel fees, and I

. apply the remainder, if any, to the payment of any sums owed by f

the Grantor to the Beneficiary or the Trustee under the Notes l

L or this Deed of Trust. Such exercise by the Trustee of the i

L remedies provided for hereunder shall not affect the right of i

the Beneficiary to maintain and continue any action theretofore l

t

l EXEIBIT J Page 12 of 17 instituted, or hereafter to bring any action, to enforce the Basic Agreements. All costs incurred in the exercise of the l remedies provided in this subparagraph 5(b) shall be secured by this Deed of Trust and shall bear interest at the Special In-terest Rate as defined in the Purchase Agreement and shall be payable on demand. In no event shall the Beneficiary in the exercise of the remedies provided in this subparagraph 5(b) be deemed a mortgagee in possession, and neither the Beneficiary nor the Trustee shall in any way be made liable for any act ei-ther of commission or omission in connection with the exercise of such remedies.

(c) Remedies Under the Uniform Commercial Code. The Beneficiary shall have and be entitled to exercise all of the rights and remedies provided a secured party under the Uniform l Commercial Code of Virginia. '

(d) Additional Remedies. The Beneficiary may exercise any and all other rights and remedies against the Grantor and the Real Estate and the Personal Property as are provided by or permitted under the laws of the Commonwealth of Virginia.

, 6. Substitution and Power of Trustee. The Beneficiary l

is hereby authorized and empowered, with or without cause, to l substitute and appoint, by an instrument recorded wherever this Deed of Trust is recorded, a trustee or trustees in the place of the Trustee hereunder. The foregoing power of substitution shall be exercisable by the Beneficiary as often as the Benefi-l ciary may desire.

l l

__ .- ,m , .. -,

EXHIBIT J Page 13 of 17

7. Fixtures and Equiement. The parties hereto agree that the recordation of this Deed of Trust shall constitute a fixture filing pursuant to Section 8.9-402 of the Code of Virginia. .

8. Cumulative Rights and Remedies. No remedy cenferred upon or given to the Trustee or the Beneficiary under the Notes or this Deed of Trust is intended to be exclusive of any other remedy granted therein or herein or by law, but each such remedy shall be cumulative and shall be in addition to every other remedy granted therein or herein or now or hereaf-ter existing at law, in equity or by statute.

9. Successors and Assigns. All rights and liabilities herein granted to or imposed upon the parties hereto shall ex-tend to and bind their respective successors and assigns.

10. Savings Clause. Nothing contained herein nor any I

transaction related hereto shall be construed or shall so oper-ate either presently prospectively (a) to require the Grantor to make any payment or to take any action contrary to law, or (b) to permit the Trustee to advance monies or take any action contrary to the law of Virginia. Should any term, provision, covenant or portion thereof or condition of this Deed of Trust be held to be void or invalid, the same shall not affect any other term, provision, covenant or condition of this Deed of Trust, but the remainder hereof shall be effective as though such term, provision, covenant or condition had not been contained herein.

EXHIBIT J Page 14 of 17

11. Notices. All notices, requests, demands and other communications provided for hereunder shall be in writing and shall be deemed to have been duly given if delivered in person or by certified or registered mail, postage prepaid, return re-ceipt requested, and if addressed as follows:

(a) If to the Grantor, to -

Old Dominion Electric Cooperative 5601 Chamberlayne Road Richmond, Virginia 23227 Attention: Executive Vice President (b) If to the Beneficiary, to -

Virginia Electric and Power Company P. O. Box 26666 Richmond, Virginia 23261 Attention: President (c) If to the Truste e, to -

or to such other addresses as shall be furnished in writing by any of the aforesaid addresses to any other.

12. Additional Terms. The following definitions

' contained in Section 55-60 of the Code of Virginia, 1950, as amended and in effect on the date of this Deed of Trust, are incorporated herein by reference thereto:

i " Deferred purchase money."

" Subject to all upon default."

" Renewal, extension or reinstatement permitted. "

"Any trustee may act."

f I.

i

EXHIBIT J Page 15 of 17

13. Titles. The titles to each paragraph hereof are for convenience only and shall not be considered or referred to in resolving questions of interpretation or construction hereunder.

IN WITNESS WHEREOF Old Dominion has caused three coun-terparts of this Purchase Money Second Deed of Trust, each of which shall be deemed to be an original, to be executed, and its corporate seal to be hereunto affixed and attested, by its duly authorized corporate officere.

OLD DOMINION ELECTRIC COOPERATIVE, a Virginia generation and transmission cooperative By:

President

[ SEAL]

ATTEST:

By:

Secretary STATE OF VIRGINIA, OF . to-wit:

The foregoing instrument was acknowledged before me in the of , Virginia, this day of

, 1983, by and as President and Secretary, respec-tively, of Old Dominion Electric Cooperative, a Virginia

_,,.____,_.y . . , .

, , . . . .__.-.._y, _ _ , _ _ -_.,_.---,__y c_

EXEIBIT J Page 16 of 17 generation and transmission cooperative, on behalf of the cooperative.

My coinmission expires: .

Notary Public

).

9 e

I l

I l

f

EXHIBIT J Page 17 of 17 Schedule A Schedule A to Deed of Trust Between Old Dominion Electric Cooperative

- and , as trustee, dated as of , 1983

[ Description of the Real Estate]

i a

a n.. -,, ,,n-,-,. r, , , , - - , - , , , - - , , . - . . . , - , - . . - ,,-ne,---

i Page 1 of 35

~

~

EXHIBIT K Payments At Closing The Parties agree that the payments at Closing shall be as follows.

The Initial Purchase Price of the Facilities shall be g their original cost less the accumulated provisions for depreciation stated on Vepco's books of l

I account plus g a negotiated payment in excess of original cost depreciated in the amount of $2,506,000 for each of North Anna Units 1 and 2 for a total of $5,012,000 in recognition of the fact that (i) Old Dominion is purchasing operating units and (ii) Old Dominion could not build the Units today for a comparable cost, as well as g a payment for that portion of the tax liability incurred by Vepco and payable in the year of Closing as a result of this transaction, grossed-up for the appropriate Federal and state income tax rate, to make Vepco whole after payment by Vepco of Federal and state income taxes calculated at the applicable statutory tax rate, computed without taking into account the tax effect of any other transaction or any applicable investment tax credits. The Parties agree that all such taxes due and payable l

by Vepco in the year of Closing, computed without taking into account the tax effect of any other transaction or any applicable investment tax credits and grossed-up as described above, will be paid to Vepco by Old Dominion At Closing in accordance with this Exhibit and that taxes due and payable by Vepco in subsequent years, computed without taking into account the tax effect l

l of any other transaction or any applicable investment tax credits and grossed-up as described above, shall be payable to Vepco by Old Dominion in the year that such taxes become due and payable by Vepco in accordance with Schedule N-1 and N-2 of Exhibit N. The total taxes incurred as a result of I

l l

• • • e-o= rr h-sy---y,w rwpw-y--y--,s.-w m g-- - -< g=P ww -w'y--Ww -"'wsm-y- = -r--ww w yv w gr v w ww g w n-y-w www -er yme, eus,y- vy-wm

I EXHIBIT K Page 2 of 35 this transaction, as well as the total amount of taxes due at Closing, are .

stated on Exhibit M.

Other Payments at closing shall include Old Dominion's share of those accounting system development costs incurred prior to Closing (not to exceed

$150,000), necessary recordation taxes and a payment or credit for deferred fuel costs as of the Closing.

In accordance with the foregoing, the following amounts will be due to Yepco at Closing:

I. Initial Purchase Price:

(a) North Anna Units 1 and 2 and Common Facilities (Schedule I) $

(b) Support Facilities (Schedule II)

(c) Operating Inventory (Schedule III) ,,

(d) Major Spare Parts (Schedule IV)

(e) Nuclear Fuel - (from Nuclear Fuel Agreement, Exhibit E) i jf) Tax Liability - (from Exhibit M)

TOTAL - Initial Purchase Price $

II. Other Payments at Closing:

(a) Accounting System Development Cost (Schedule V) $

(b) Recordation Tax

! (c) Deferred Fuel Cost (Schedule VI) l l (d) Preliminary Survey and Investigation, and Miscellaneous Suspense-Debit (Schedule VII)

(e) Prepaid Insurance (Schedule VIII)

-- -, ,- , . . _ , . - , ..-n-. .-, , ,,- - -- ,- -

^ '

l

)

l EXHIBIT K Page 3 of 35 TOTAL - Other Payments $-

(

l Total Initial Purchase Price and Other Payments $

Less:

Total Leferred Tax Pursuant to Exhibit N $

(1) TOTAL PAYMENT DUE AT CLOSING $

(2) TOTAL PAYMENT DUE UNDER SECTION 3.01 $

DIFFERENCE DUE (2-1) $

The Parties agree that the Total Payment Due At Closing will be an l estimate calculated as of the Closing Date. When actual amounts are available, the Total Payment Due under Section 3.01 shall be calculated as of the Closing Date for record purposes. Any difference will be paid to the appropriate Party within 30 days of written notice of the Difference Due.

l

- , , - , , - - - - , , - - , , - , , . . . . - , , - , . - .,,,-.,,-,,-n . , - - - - , , , . . , . . - - - , . . , . , - - , , , , , . . . . , - --.-.,..-.----,-,----n... , . , , . - -

EXHIBIT K Page 4 of 35 Schedule I Page 1 oT 1-Initial Purchase Price North Anna Units 1 and 2; Common Facilities Old Dominion Percentage Ownership Payment Total Interest Due North Anna Unit 1 - Plant (Schedule I-A)

Negotiated Payment North Anna Unit 1 North Anna Unit 2 - Plant (Schedule I-B)

Negotiated Payment North Anna Unit 2 North Anna - Comon Facilities (Schedule I-C)

TOTAL $

EXHIBIT K ,

Page 5 of 35 Schedule I-A Page 1.of,1 Initial Purchace Price North Anna Unit 1 Plant FERC In Service CCNC(1) CWIP(2) 3 Account Description Acct.101 Acct.106 Acct. 1 Total 321 Structures and Improvements $ $ $ $

322 Reactor Plant Equipment 323 Turbogenerator Units 324 Accessory Electric Equipment 325 Miscellaneous Power Plant Equipment -

Construction Work in Progress (3)

Total Plant Unit 1 -

Excluding Comon Facilities $ 5 $ $

Accumulated Depreciation Het Book Cost - Unit 1 $

(1) As used in this Exhibit, Completed Construction Not Classified is abbreviated as CCNC. See Exhibit K. Schedule I-A(a) for detail.

(2) As used in this Exhibit, Construction Work in Progress is abbreviated as CWIP.

See Exhibit K Schedule I-A(b) for detail.

(3) Includes Insurance Work Orders, Schedule I-A(c).

l t , ,

_ _ _ - __ .. __._ _ . . . _ _ . . _ _ _ _ . , _ . _ . ~ .

EXHIBIT K Pag 3 6 of 35 Schedule I-A(a)

Page 1 of 1 Initial Purchase Price North Anna Unit 1 - CCNC ,

Req. # Description Improvement AFC Total 1

I Total $ $ $

d e

EXHIBIT K Page 7 of 35 Schedule I-A(b)

Page 1 of 1 i

Initial Purchase Price North Anna Unit 1 - CWIP Req. # Description Improvement AFC Total l

l l

Total $ $ $

n

EXHIBIT K Page 8 ef 35 Schedule I-A(c)

Page 1 of 1 Initial Purchase Price North Anna 1 Insurance Work Orders Work Order Description Total -

e*

i l

^

l .

l l

l l

EXHIBIT K Page 9 of 35 SCHEDULE.I-B Page 1 of 1 Initial Purchase Price North Anna Unit 2 Plant FERC In Service CCNC CWIP Account Description Acct.101 Acct.106(1 ) Acct.107(2)(3) Total 321 Structures and Improvements $ $ $ $

322 Reactor Plant Equipment 323 Turbogenerator Units 324 Accessory Electric Equipment 325 Miscellaneous Power -

Plant Equipment Construction Work in Progress (3)

Total Plant Unit 2 $ $ $ $

Accumulated Depreciation Net Book Cost - Unit 2 $

l (1) See Exhibit X, Schedule I-B(a) for detail.

(2) See Exhibit K, Schedule I-B(b) for detail.

(3) Includes Insurance Work Orders, Schedule I-Bic),

i - -- _ - _ - .

EXHIBIT K Page 10 of 35 Schedule I-B(a)

Page 1 of 1 Initial Purchase Price -

North Anna Unit 2 - CCNC Req. # Description Improvement AFC Total Total s s $

m

EXHIBIT K Page 11 of 35 Schedule I-B(b)

Page 1 of 1 Initial Purchase Price North Anna Unit Z - CWIP Req. # Description Improvement AFC Total Total $ $ $

l i

EXHIBIT K Page 12 of 35 Schedule I-B(c)

Page 1 of 1 Initial Purchase Price North Anna Unit 2 Insurance Work Orders Work Order Description Total l

4 4

l l

l l

l l

l

EXHIBIT K Page 13 of 35 Schedule I-C Page 1 of 2

~

~

Initial Purchase Price Common Facilities Plant FERC In Service CCNC CWIP Account Description Acet.101 (1 ) Acet.106(2) Acet.107(3)(4) Total 320 Land and Land Rights $ $ $ $

3 21 Structures and Improvements 322 Reactor Plant Equipment 323 Turbogeneratcr Units 324 Accessory Electric Equipment 325 Miscellaneous Poiter Plant Equipment 352 Transmission Structures -

and Improvements _

353 Transmission Station Equipment 390 Structures and Improvements 391 Office Furniture and Equipment 392 Transportation Equipment (1) See Exhibit K, Schedule 1-C(a) for detail.

(2) See Exhibit K, Schedule I-C(b) for detail.

(3) See Exhibit K. Schedule I-C(c) for detail.

(4) Includes Insurance Work Orders, Schedule I-C(d).

- - - - - , - - - - - m

EXHIBIT K Page 14 of 35 Schedule I-C Page 2 of.2 Initial Purchase Price Common Facilities

Plant FERC In Service CCNC CWIP Account Description Acct.101 (1 ) Acct.106(2) Acet.107(3)(4) Total 393 Stores Equipment $ $ $ $

394 Tools, Shop and Garage Equipment 395 Laboratory Equipment

, 396 Power Operated Equipment 397 Cannunication Equipment

~

Miscellaneous i398 Equipment .

Construction Work in Progress (4) _

Total Common Facilities $ $ $ $

, Accumulated Depreciation Net Book Cost - Common Facilities $

(1) See Exhibit K, Schedule I-C(a) for detail. .

(2) See Exhibit K, Schedule I-C(b) for detail.

(3) See Exhibit K, Schedule I-C(c) for detail.

(4) Includes Insurance Work Orders, Schedule I-C(d).

l

EXHIBIT X Page 15 of 35 Schedul,e I-C(a)

Page 1 of 5 Initial Purchase Price Connon Facilities ELECTRIC PLANT IN SERVICE FERC ACCOUNT DESCRIPTION TOTAL

'320 Land and Land Rights $

321 Structures & Improvements Clearing Water System Stom Sewers Sanitary Sewers Fire Protection Fuel 011 Storage RR Track Yard Yard Lighting Boat Dock -

Rifle Range Gun Towers Medical Classroom Condensate Fill Pump Station Auxiliary Building Turbine Building Turbine Outage Building Office Building Screenwell Structure Vacuisa Priming Pump House Fuel Building Fuel Oil Pump House Yard Crane Water Treatment Building Service Building Weather Towers Meteorological Towers Security Building

EXHIBIT K Page 16 of 35 Schedule I-C(a)

Page 2 of 5 FERC ACCOUNT DESCRIPTION TOTAL 321 (Con't) Security Control Center Dam Reservoirs Spillways Dikes Service Water Pump House Decontamination Building Waste Disposal Building Roadways Walkways Parking Lots 322 Reactor Plant Equipment $

Boron Recovery System Moving Platfonn Spent Fuel Pit Fuel Building Cranes ~

Decontamination Cranes Fuel Receiving Equipment Spent Fuel Racks Reactor Cavity Purification

EXHIBIT K Page 17 of 35 Schedule I-C(a)

Page 3'6f 5 FERC ACCOUNT DESCRIPTION TOTAL 322 (Con't) Radioactive Waste Treatment and Disposal System Liquid Waste Solidification System Waste Disposal Evaporator Radioactive Gaseous Waste Radioactive Solid Waste Decontamination Systen Raw Water Supply System Condensate Storage Tank Auxiliary Boiler System 323 Turbogenerator Equipment $

Service Water Pump House Equipment Bearing Cnoling Water Tower Turbine Room Crane -

324 Accessory Electric Equipment Screenwell Area Transfomers and Equipment Reserve Station Service Transformer Bearing Cooling Tower Switch Boards l

l l

l l

l

EXHIBIT K Page 18 of 35 Schedule I-C(a)

Page 4"of 5 FERC ACCOUNT DESCRIPTION TOTAL 325 Miscellaneous Power Plant Equipment $

Compressed Air Systems Miscellaneous Shop Equipment Machine Shop Equipment Laboratory Testing Equipment Office Furniture and Equipment Other General Station Equipment Weather Station Equipment Marine Equipment Kitchen Equipment Fire Protection Equipment Plant Communications Telephone Sp tem Security Equipment Radiation Monitoring Equipment Gasoline Storage Equipment ..

352 Transmission Structures and Improvements 353 Transmission Station Equipment l

l l

1 .. . _

I EXHIBIT K Page 19 of 35 Schedule I-C(a)

Page 5 of'5 i i FERC ACCOUNT DESCRIPTION TOTAL 390 Structures and Improvements $

Visitors Information Center 391 Office Furniture and Equipment 392 Transportation Equipment 393 Stores Equipment 394 Tools, Shop and Garage Equipment 395 Laboratory Equipment 396 Power Operated Equipment 397 Communication Equipment 398 Miscellaneous Equipment Total Electric Plant in Service $

EXHIBIT K Page 20 of 35 Schedule I-C(b)

Page 1 of 1 Initial Purchase Price COMMON - CCNC Req. # Description Improvement AFC Total Total $ $ $

l l

. - - , - , - , - , _ . _ - . _ _ - - - - - . . _ - _ , , _ - - ~ . . _

EXHIBIT K Pag 2 21 of 35 Schedule I-C(c)

Page 1 of 1 Initial Purchase Price C0! HON - CWIP Req. # Description Improvement AFC Total Total $ $ $

1 I

i l

l l

l --

I EXHIBIT X Page 22 of 35 Schedule I-C(d)

Page 1 of 1 Initial Purchase Price Connon Facilities Insurance Work Orders Work Order Description Total i $

TOTAL $

ee

EXHIBIT K Page 23 of 35 Schedule II Page 1 of 1 Initial Purchase Price Support Facilities Old Dominion Percentage FERC CCNC CWIP Ownership Account Description Acct.106(1 ) Acct.107(1)(2) Interest Total 325 Miscellaneous Power Plant Equipment $ $ $

397 Comunication Equipment Construction Work In Progress (2)

Total Support Facilities $ $ $

Accumulated Depreciation -

Net Book Cost - Support Facilities $

(1) See Exhibit K, Schedule II(A) for detail. , ,

i (2) Includes Insurance Work Orders, Schedule II-B.

i

.- - - -~ . . _ _ _ - _ ._.__ _-., -.

~ '

EXHIBIT K Page 24 of 35 Schedule II-A l Page 1 of 2 i Initial Purchase Price SUPPORT FACILITIES - CCNC Total Total Ownership Ownership Req. f Description Improvement AFC Interest Interest I $ $ $

Total 3 g i

e

EXHIBIT K Page 25 of 35 Schedule II-A Page 2 of 2 Initial Purchase Price SUPPORT FACILITIES - CWIP Total Total Ownership Ownership Req. # Description Improvement AFC Interest Interest Total $ $

1>

l i

I c --

EXHIBIT K I Page 26 of 35 Schedule II-B Page 1 pf 1 Initial Purchase Price Support Facilities Insurance Work Orders Old Dominion Percentage Ownership Work Order Description Total Interest Payment a

9 TOTAL $

l i

l 0435B/27 I

~ . __ .

EXHIBIT K Page 27 of 35 Schedule III Page 1 of 1 Initial Purchase Price Operating Inventory

- Old Dominion FERC Ownership Account Description Total Interest at 11.6%

154 Plant Materials and Operating Supplies $ $

s

EXHIBIT K Page 28 of 35 Schedule IV Page 1 of'1 Initial Purchase Price Major Spare Parts Old Dominion 1

Plant Percentage FERC In Service CCNC CWIP Ownership Account Description Acet. 101 Acct.106 Acet. 107(1 ) Interest Total 322 Reactor Plant Equipment $ $ $ $

Total Major Spare Parts $ $

Accumulated Depreciation Net Book Cost - Major -

Spare Parts $

(1) Includes Insurance Work Orders, Schedule IV-C.

The Parties intend that a'ny Major Spare Part, as designated by the Parties, shall be paid for at Closing in accordance with this Schedule IV.

1

EXHIBIT K Page 29 of 35 Schedule IV-A Page 1 ~of 1 Initial Purchase Price MMOR SPARE PARTS - CCNC Req. # Description Improvement AFC Total TOTAL $

1

EXHIBIT K Page 30 of 35 Schedule IV-B Page 1 of 1 Initial Purchase Price ,

MAJOR SPARE PART5 - CWIP Req. # Description Improvement AFC Total TOTAL $

l

. . - - . . , . - _ . . - - - - . - - - - . . ~ , , . - , _ _ . - _ . - - - . . - .. -.. ._.- , ,_ _,,-.. .. ._ ---

EXHIBIT K Page 31 of 35 Schedule IV-C Page 1,of 1 Initial Purchase Price Major Spare Parts Insurance Work Orders Old Dominion Percentage Ownership Work Order Description Total Interest Payment TOTAL $

e e

.y ~ -- - -

EXHIBIT K Page 32 of 35 Schedule V Page 1 'of 1 Initial Purchase Price Accounting System Development Description Old Dominion of System Costs Share at 50%

Software and Procedures to Provide for Joint Ownership Accounting of North Anna Including Vepco and Consultant Development Costs $ $

Payments for Old Dominion share of accounting system development costs incurred through Closing will be covered by this Schedule V. The Old Dominion share of subsequent accounting system development costs will be paid to Vepco monthly as those costs are incurred.. In no event shall the -

Old Dominion share of accounting system development costs exceed $150,000.

l 1

I I

l l

EXHIBIT K Page 33 of 35 Schedule VI

. Page 1 of 1 INITIAL PURCHASE PRICE l DEFERRED FUEL COSTS Amount A. Balance as of the Closing Date (Old Dominion) $

B. Percentage attributable to North Anna (See Note 1)  %

C. North Anna's Portion $

1 D. Amount due from or to Old Dominion at the Closing Date $

E. Deferred fuel expense as of (Date)

(A-D) $

Note (1) - Computation of Percentage Attributable to North Anga (a) North Anna Unit 1 generation September 1981 - the Closing Date mwh (b) North Anna Unit 2 generation September 1981 - the Closing Date mwh (c) Total North Anna Units 1 and 2 generation (a+b)

September 1981 - the Closing Date mwh (d) Total System output September 1981 - the Closing Date mwh (e) Percentage of total system output attributable to North Anna Units 1 and 2 generation (c/d)  %

( ) Denotes Over-Recovery 1

i

. u EXHIBIT K Page 34 of 35 Schedule VII Page 1 of 1 Initial Purchase Price Preliminary Survey and Investigation, Miscellaneous suspense - Debit Old Dominion Ownership FERC 183-Preliminary Survey & Investigation Charges Total Interest at 11.6%

Total - 183 $

FERC 186-Miscellaneous Suspense - Debit Total - 186 $

Total 186 and 183 $ $

h

EXHIBIT K Page 35 of 35

, Schedule VIII Page 1 of 1, Initial Purchase Price Prepaid Insurance Old Dominion Ownership FERC 165 Insurance - Prepayments Total Interest at 11.6%

Policies Account Number S

_o O

e

i i

EXHIBIT L l Page 1 of 26 Monthly Statement for Old Dominion Share of New Investment Month of 19 In-Service North Anna Nuclear Units (Schedule 1) $

Common Facilities (Schedule 2)

Support Facilities (Schedule 3)

Operating Inventory (Schedule 4)

Major Spare Parts (Schedule 5)

Preliminary Survey and Investigation (Schedule 6) _

Miscellaneous Deferred - Debits (Schedule 7)

Nuclear Fuel (From Exhibit F -

Nuclear Fuel Agreement)

Total l Interest on Unpaid Invoices _(Schedule 3)_

(Under Purchase Agreement) -

Total Billing $

o EXHIBIT L Pag) 2 of 26 Schedule 1 Page 1 of 1 Share of New Investment In-Service North Anna Nuclear Units Month of 19 In-Service North Anna Nuclear Units 1 Construction Work in Progress (Schedule 1-A) $

Retirement Work in Progress (Schedule 1-B)

Adjustments and Transfers (Schedule 1-C)

Insurance Work Orders (Schedule 1-D)

Total In-Service Units $

e 9 4 9

1 l

EXHIBIT L Page 3 of 26 Schedule 1-A Page 1 of 1 Monthly Budgeted / Actual New Investment Month of 19 Adjustment In-Service 19 19 19 Difference Nuclear Units Budget Actual Estimated (2-3) Total

~

Construct. Work In Progress North Anna 1 Project No. $ $ $ $ $

Total N. A.1 North Anna 2 Project No.

Total N. A. 2 '

Total Construct.

Work in Progress $ $ $ $ $

Old Dominion Purchase Ratio (A) 11.6%

Old Dominion Share of Construction Work in Progress $

l (A) Unless adjusted pursuant to Purchase Agreement.

l

~

EXHIBIT L Page 4 of 26 Schedule 1-B Page 1 of 1 Monthly Budgeted / Actual New Investment Month of 19 Adjustment In-Service 19 19 19 Difference Nuclear Units Budget Actual Estimated (2-3) Total Retirement Work In Progress (Net of Salvage)

North Anna 1 Project No, $ $ $ $ $

Total N. A.1, North Anna 2 Project No.

Total N. A. 2 Total Retirement Work in Progress $ $ __

Old Dominion Purchase Ratio (A) 11.5%

Old Dominion Share of Retirement Work in Progress $

(A) Unless adjusted pursuant to Purchase Agreement.

EXHIBIT L l Page 5 of 26 l Schedule 1-C Page 1 of 1 Actual New Investment Adjusbnents and Transfers

~

Month of 19 Transaction Type (1) Cost In-Service North Anna Nuclear Units Description $ .

Net Effect Old Dominion Purchase Ratio (A) 11.6%

Old Dominion Share of In-Service Units $

(i) Adjustment In Adjustment Out Transfer In Transfer Out "

(A) Unless adjusted pursuant to Purchase Agreement.

J l

EXHIBIT L Paga 6 of 26 Schedule 1-D Page 1 of 1 Actual New Investment Insurance Work Orders Month of 19 In-Service North Anna Nuclear Units Total Description Total Insurance Work Orders $

Old Dominion Purchase Ratio (A) 11.6%

Old Dominion Share of In-Service Units $

i (A) Unless adjusted pursuant to' Purchase Agreement. ,

T. .

~ _,

g em+

.n.

et y p

9

'M y

+

p- ,,-w ---- - , ,- - - - , - , ,-- ew,,---- ,- -

EXHIBIT L Page 7 of 26 Schedule 2 Page 1 of 1 Share of New Investment Common Facilities Month of 19 Common Facilities Construction Work in Progress (Schedule 2-A) $

Retirement Work in Progress (Schedule 2-B)

Adjustments and Transfers (Schedule 2-C)

Insurance Work Orders (Schedule 2-D)

Total Common Facilities $

O

-- - - - - - , - , - - - + - - - , , . - - - - - -

l EXHIBIT L Pag 2 8 of 26 Schedule 2-A Page 1 of 1 l

Monthly Budgeted / Actual New Investment Month of 19 Adjustment Comon 19 19 19 Difference Facilities Budget Actual Estimated (2-3) Total Construct. Work In Progress $ $ $ $ $

Total CWIP $ $ $ $ $

Old Dominion Purchase Ratio (A) 11.6%

Old Dominion Share of Construction Work in Progress $

i (A) Unless adjusted pursuant to Purchase Agreement.

l l

l

EXHIBIT L l Page 9 of 26 SchGdule 2-B l Page 1 of 1 Monthly Budgeted / Actual New Investment Month of 19 _

Adjustment Common 19 19 19 Difference Facilities Budget Actual Estimated (2-3) Total

~ --

Retirement Work In Progress (Net of Salvage) $ $ $ $ $

Total RWIP $ $ $ $ $

l l Old Dominion 11.6%

Purchase Ratio (A)

Old Dominion Share of Retirement Work in Progress $

l 1

(A) Unless adjusted pursuant to Purchase Agreement.

l l

EXHIBIT L Page 10 of 26 Schedule 2-C Page 1 of 1 Actual New Investment Ad.iustments and Transfers Month of 19 Transaction Type (1) Cost Conunon Facilities Description $

Net Effect .

Old Dominion Purchase Ratio (A) 11.6%

1 Old Dominion Share of Comon Facilities $

(1) Adjustment In Adjustment Out Transfer In Transfer Out o

(A) Unless adjusted pursuant to Purchase Agreement.

l l

1

-- w- , -

,,w- --- w-. --w,-p y , g , -r- - w-w----- ,-- - --------+t' 'w- T

l EXHIBIT L Pagg 11 of 26 Schedule 2-D Page 1 of 1 Actual New Investment Insurance Work Orders Month of 19 Total Comon Facilities Description Total Insurance Work Orders $

Old Dominion Purchase Ratio (A) 11.6%

Old Dominion Share of Common Facilities $_

(A) Unless adjusted pursuant to Purchase Agreement.

t>

EXHIBIT L Pagg 12 of 26 Schedule 3 Page 1 of 1 Share of New Investment Support Facilities Month of 19 Support Facilities Construction Work in Progress (Schedule 3-A) $

Retirement Work in Progress (Schedule 3-B)

Adjustments and Transfers (Schedule 3-C) l Insurance Work Orders (Schedule 3-D)

Total Support Facilities $

-- - - , , - - ~ . . . . . - - . . , - - -

EXHIBIT L Page 13 of 26 Schedule 3-A Page 1 of 1 Monthly Budgeted / Actual New Investment Month of 19 Adjustment Support 19 19 19 Difference Facilities Budget Actual Estimated (2-3) Total Construct. Work In Progress $ $ $ $ $

Total CWIP $ $ $ $ $ ,

Old Dominion Purchase Ratio (A)

Old Dominion Share of Construction Work in Progress $

(A) Done separately for each support facility.

i ,

a

B EXHIBIT L Pag 214 of 26 Schedule 3-B Page 1 of 1 Monthly Budgeted / Actual New Investment Month of 19 Adjustment Support 19 19 19 Difference Facilities Budget Actual Estimated (2-3) Total Retirement Work In Progress (Net of Salvage) 3 $ $ $ $

Total RWIP $ $_ $ $ $

Old Dominion Purchase Ratio (A)

Old Dominion Share of Retirement Work in Progress $

(A) Done separately for each support facility.

r EXHIBIT L Page 15 of 26 Schedule 3-C Page 1 of 1 Actual New Investment Adjustments and Transfers Month of 19 Transaction Type (1) Cost Support Facilities Description $

Net Effect Old Dominion Purchase Ratio (A)

Old Dominion Share of Support Facilities $

l (1) Adjustment In Adjustment Out

! Transfer In i Transfer Out l

l (A) Done separately for each support facility.

i, l

l l

- . ._ . . . _ . - _ - = - _ _ _ _ - - . . -. -

EXHIBIT L Page 16 of 26 Schedule 3-D Page 1 of 1 Actual New Investment Insurance Work Orders Month of 19 Support Facilities Total Description Total Insurance Work Orders Old Dominion Purchase Ratio (A)

Old Dominion Share of Support Facilities $

(A) Done separately for each support facility.

I e

i EXHIBIT L Pag 9 17 of 26 Schedule 4 Page 1 of 1 Monthly Budgeted / Actual New Investment Month of 19 Adjustment Operating 19 19 19 Difference Inventory Budget Actual Estimated (2-3) Total Plant Materials and Operating Supplies $ $ $ $ $

Total Operating Inventory $ $ $ $ $

Old Dominion Purchase Ratio (A) 11.6%

Old Dominion Share of Operating Inventory $

(A) Unless adjusted pursuant to Purchase Agreement.

l

EXHIBIT L Page 18 of 26 Schedule 5 Page 1 of 1 Share of New Investment Major Spare Parts

> Month of 19 Major Spare Parts, Construction Work in Progress (Schedule 5-A) 3 -

Retirement Work in Progress (Schedule 5-B)

Adjustments and Transfers (Schedule 5-C)

Insurance Work Orders (Schedule 5-D)

Total Major Spare Parts $

1 l

l l

l l

EXHIBIT L Page 19 of 26  !

Schedule 5-A i Page 1 of 1 l

Monthly Budgeted / Actual New Investment Month of 19 Adjustment Major Spare 19 19 19 Difference Parts Budget Actual Estimated (2-3) Total Construction Work in Progress $ $ $ $ $

Old Dominion Purchase Ratio (A)

Old Dominion Share of Major Spare Parts $

(A) Done separately for each major spare part.

\

EXHIBIT L Page 20 of 26 Schedule S-B Page 1 of 1 Monthly Budgeted / Actual New Investment Month of 19 Adjustment Major Spare 19 19 19~ Difference Parts Budget Actual Estimated (2-3) ,

Total ,

Retirement Work in Progress $ $ $ $ $

l Old Dominion Purchase Ratio (A)

Old Dominion Share of Major Spare Parts $

l (A) Done separately for each major spare part.

EXHfBIT L Pag 2 21 of 26 Schedule 5-C Page 1 of 1 Actual New Investment Adjust::lents and Transfers Month of 19 Transaction Type (1) Cost Major Spare Parts Description $ ,

I Net Effect Old Dominion Purchase Ratio (A)

Old Dominion Share of Major Spare Parts $

(1) Adjustment In Adjustment Out Transfer In .

Transfer Out (A) Done separately for each major spare part.

l

___ ____..____ _ ____.l

l l

EXHIBIT L '

Page 22 of 26 Schedule 5-D Page 1 of 1 Actual New Investment Insurance Work Orders Month of 19 Major Spare Parts Total Description Total Ins cance Work Orders Old Dominion Purchase Ratio (A)

Old Dominion Share of Major Spare Parts $

(A) Done separately for each major spare part.

o I

l EXHIBIT L

! Page 23 of 26 Schedule 6 Page 1 of 1

)

Monthly Budgeted / Actual New Investment Month of 19 Adjustment Preliminary l Survey and Investigation 19 19 19 Difference FERC 183 Budget Actual Estimated (2-3) Total Description -

Account Number l

Total Prel.

Survey and Investigation $ $ $ $ $

Old Dominion Purchase Ratio (A)

Old Dominion Share of Preliminary Survey and Investigation $

(A) Done separately for each account.

)

EXHIBIT L Page 24 of 26 Schedule 7 Page 1 of 1 Monthly Budgeted / Actual New Investment Month of 19 Adjustment Miscellaneous Deferred-Debits 19 19 19 Difference FERC 186 Budget Actual Estimated (2-3) Total Description -

Account Number Total Misc.

Deferred - Debit $ $ $ $ $

Old Dominion I Purchase Ratio (A) _

Old Dominion Share of Miscellaneous Deferred - Debit $

(A) Done separately for each account.

EXHIBIT L Page 25 of 26 Schedule 8 Page 1 of 2 Interest Calculation on Adjustment to Actual For the Month of 19 Type of Actual to Budget Old Dominion Old Dominion's Investment Difference  % Ownership (A) Prorata Share In Service Units Schedule 1-A $ 11.6% $

Schedule 1-B 11.6%

Schedule 1-C 11.6%

Schedule 1-D 11.6%

Common Facilities Schedule 2-A 11.6%

Schedule 2-B 11.6%

Schedule 2-C 11.6%

Schedule 2-D 11.6%

Suaport Facilities Sc 1edule 3-A (B)

Schedule 3-B (B) l Schedule 3-C (B)

, Schedule 3-D (B) l Operating Inventory Schedule 4 11.6%

Major Spare Parts Schedule 5-A (B)

Schedule S-B (B)

Schedule 5-C (B)

Schedule 5-D (B)

Sub-Total $

e

- , ,- - ,, - .,-,-,.r- ., -- -n- -n-, , - - - - - - - - - ~ - - - -

EXHIBIT L l Page 26 of 26 1 Schedule 8 Page 2 of 2 l

Interest Calculation on Adjustment to Actual l For the Month of 19 Type of Actual to Budget Old Dominion Old Dominion's Investment Difference  % Ownership (A) Prorata Share Sub-Total Brought Forward $

Preliminary Survey and Investigation Schedule 6 (B)

Miscellaneous Deferred-Debit Schedule 7 (B) l Total Adjustment Interest at for /365 Days $

(A) Unless adjusted pursuant to Purchase Agreement.

, (B) Done separately for each support facility, major spare part, preliminary I

survey and investigation and miscellaneous deferred debit account.

l

EXHIBIT M Page 1 of 8 EXHIBIT M Payment of Tax Liability at Closing The Total Tax Liability payable at Closing under the Purchase Agreement shall be as follows:

Schedule M-1: North Anna Unit 1 and Common Facilities $

Schedule M-2: North Anna Unit 2 Schedule M-3: Support Facilities Schedule M-4: Operating Inventory Schedule M-5: Major Spare Parts TOTAL TAX LIABILITY $

~

NOTE RECEIVABLE (EXHIBIT N) $ ..

TAX LIABILITY PAYABLE AT CLOSING $ -

The Parties agree that the Total Payment of Tax Liability at Closing will be an estimate calculated as of the Closing Date. When actual amounts are available the total Payment of Tax Liability at Closing shall be recalculated as of the Closing Date for record purposes. Any difference will be paid to the appropriate Party at the same time that the Difference Due under Exhibit X is paid.

All amounts stated herein are in respect to Old Dominion's Percentage Ownership Interest.

, - - - - - - - , , - , , , , - - - - + , - - - - - - - , , - - -e,--- .v-,--,-- ----,._,------,-,-,.,,_-_.-,-,,---,na,- - - -

a,,,a.,- w-_, - , -,---w-,,-- - - - -

EXHIBIT M Page ? of 8 Schedule M-1 o Page 1 of 2 ,

Tax Liability North Anna Unit 1 and Common Facilities Gross Book Additions - North Anna Unit 1 and Common Facilities $

Less: Allowance For Funds Used During Construction:

i Taxes Capitalized:

I Vehicles Title Property Sales & Use Genefit Plan Cost Add: Interest Income Capitalized-Town of Louisa Preliminary Operations Tax Basis Before Depreciation Less: Tax Depreciation Tax Basis $

I. Gross Up of Tax Consequences A. Tax Consequences

-Capital Gains Tax $

-Federal Ordinary Tax

-N.C. State Income Tax

-W. VA State Income Tax B. Gross Up for Additional Tax

EXHIBIT M , ,

Page 3 of 8 < '

Schedule W1..

Page 2 of 2 II. Proof of Additive Factor A. Purchase Price Before Additive Factor For Tax $

B. Negotiated Payment in Excess of Original Cost Depreciated C. Additive Factor from I-B D. Total Purchase Price E. Less: Depreciated Tax Basis F. Total Gain on Sale G. N.C. State Income Tax H. W. VA State Income Tax I. Federal Ordinary tax -

J. Capital Gains Tax Total Taxes - Schedule M-1 $

i I

F EXHIBIT M Page 4 of 8 ,

Schedule M-2 Page 1 of 2

_ Tax liability North Anna Unit Z Gross Book Additions - North Anna Unit 2 $

Les?,: Allowance For Funds Used During Construction:

Taxes Capitalized:

Vehicle Title Property Sales & Use Benefit Plan Costs Add: Interest Income Capitalized-Town of Louisa Preliminary Operations

+

Tax Basis Before Depreciation Less: Tax Depreciation Tax Basis $

I. Gross Up of Tax Consequences A. Tax Consequences

-Capital Gains Tax $

-Federal Ordinary Tax

-N.C. State Income Tax

-W VA State Income Tax B. Gross Up for Additional Tax

EXHIBIT M ,

Page 5 of 8 Schedule M-2 Page 2 of 2 II. Proof of Additive Factor A. Purchase Price Before '

Additive Factor For Tax $ .

B. Negotiated Payment in Excess of Original Cost Depreciated C. Additive Factor from I-B D. Total Purchase Price E. Less: Depreciated Tax Basis F. Total Gain on Sale G. N.C. State Income Tax $

H. W. VA State Income Tax I. Federal Ordinary Tax ~

J. Capital Gains Tax

_ Total Taxes - Schedule M-2 $

4

EXHIBIT M g Page 6 of 8 Schedule M-3 i Page 1 of 1

. Tax Liability _

Support Facilities Gross Book Additions - Support Facilities $

Less: Allowance For Funds Used During Construction $

Taxes Capitalized: $

Vehicle Title $

Property $

Sales & Use $

Benefit Plan Costs $

TOTAL $

Add: Interest Income Capitalized

-Town of Louisa $

Preliminary Operations $

Tax Basis Before Depreciation $

Less: Tax Depreciation __

Tax Basis $

I. Gross Up of Tax Consequences A. Tax Consequences

-Capital Gains Tax

-Federal Ordinary Tax $

-N.C. State Income Tax

-W. VA State , Income Tax _

B. Gross Up for Additional Tax II. Proof of Additive Factor A. Purchase Price Before Factor For Tax Additive $

B. Additive Factor from I-B C. Total Purchase Price D. Less: Tax Basis E. Total Gain on Sale F. N.C. State Income Tax G. V. VA State Income Tax H. Federal ordinary tax-I. Capital Gains Tax

_ Total Taxes - Schedule M-3 $

EXHIBIT M Page 7 of 8 Schedule M-4 Page 1 of 1 Tax Liability Operating Inventory Operating Inventory located at the North Anna Nuclear Power Station.

Operating Inventory Total l

l l

l l

l l

l l

l

~~

EXHIBIT M o Page 8 of 8 Schedule M-5 Page 1 of 1

{

7 YaxLiability Ma; or Spare Parts Gross Book Additiens - Major Spare Parts $

~

Less: Allowance For Funds

~

Used During Construction $

, Taxes Capitalized: $

, Yehicle Title $

. Property $

Sales & Use $

Benefit Plan Costs $

TOTAL $

Add: Interest Incoma Capitalized

-Town of Louisa $

Preliminary Operations $

Tax Basis Before Depreciation $_

Less: Tax Depreciation

~

Tax Basis ~

I. Gross,Up of Tax Consequences A. Tax Consequences

-Federal Ordinary Tax $

-N.C. State Income Tax

.-W. YA State Income Tax B. Gross Up for Additional Tax II. Proof of Additive Factor '

1 A. Purchase Price Before Additive l

Factor For Tax $

B. Additive Factor from I-B C. Total Purchase Price D. Less: Depreciated Tax Basis ~

E. Total Gain on Sale F. N.C. State Income Tax $

G. W. VA State Income Tax H. Federal Ordinary Tax

_Tntal Tavoc Rehadn1p_M 5_ $

- - - . - - - _ - , , , . , ye# ,w. e - .. . - - - , _ . , , e ,

,p - ,, -- +--w

Page 1 of 8 EXHIBIT N Deferred Payment Schedule - Taxes The taxes listed on this Schedule represent that portion of the total taxes incurred by Vepco pursuant to Exhibit M relating to the Facilities that the Parties have agreed will be payable by Old Dominion to Vepco over the 4

remaining tax-depreciable lives of North Anna Unit 1 and North Anna Unit 2 detennined as of the Closing. The annual amount set forth below for any calendar year shall be payable in equal quarterly installments on March 15, June 15, September 15 and December 15 of each year.

Promissory Promissory Note #1 Note #2 Total Year (Schedule N-1) ,

(Schedule N-2) Receivable 1984 $ $ $

1985 1986 1987 1988 1989 1990 1991 l 1992 199's 1994 l 1995 1996 TOTAL $ $ $

l

EXHIBIT N Page 2 of 8 The Parties agree that the Deferred Tax Payment Schedule will be an estimate calculated as of the Closing Date. When actual ar.ounts are available at the time that the difference due under Exhibit K is paid, the Deferred Tax Payment Schedule shall be recalculated as of the Closing Date for record purposes and the recalculated amounts shall be the amounts to be paid by Old Dominion in future years. When such actual amourits are available, the Purchase Money Second Deed of Trust Note, in the form of Exhibit 0, shall be j re-executed using actual numbers.

0

EXHIBIT N Page 3 of 8 l Schedule N-1 Page 1 of 1-Deferred Payment Schedule Promissory Year Note il i 198A

! 1985 1986 1987 1988 i

1989 4

1990 I 1991 1992 1993 TOTAL $

(

l l

EXHIBIT N Page 4 of 8 Schedule N-2 Page 1 of 1-Deferred Payment Schedule Promissory Year Note #2 1984 $

1985 1986 1987

., 1988 1989 1990 1991 1992 1993 1994 1995 1996 TOTAL $

I I

, - - . - ,e-- - , - , , ,.,. -- ,, ,.----,-.-.---,.wn.-,,n, e-.--,-,, ---,. - . - - , a m - - , --,,n-- -,-- , . , . . - --, - - - - - , - - - - - - - -

EXHIBIT N - ,

Page 5 of 8 Deferred Payment Schedule Cancellation Costs Cancellation Costs shall be determined in accordance with the provisions of Schedule N-3. Schedule N-3 shall be applied separately to each year, as appropriate.

Surry North Anna North Anna Year Units 3 and 4 Unit 3 Unit 4 Total, 1983 (NOY, DEC) $ $ $ $

1984 1985 1986 1987 1988 1989 1990 1991 1992 1993

~

TOTAL $ $__ $ $

Deferred Cancellation Costs shall be paid monthly at the same time as payments for Supplemental Demand under the Interconr.ection and Operating Agreement.

EXHIBIT N g Page 6 of 8 l Schedule N-3 Page 1 of 3 l

CANCELLATION COSTS Total Am'unt o  ;

System Applicable to I Unamortized North Anna North Anna Units  !

Abandoned Percentage 1 and 2 (See Foot-Project (See Footnote note 2 below)

Costs 1 below) (Col 1 x Col 2)

(Column 1) (Column 2) (Column 3)

PLANT Surry Unit 3 $ $

Surry Unit 4 North Anna Unit 3 North Anna Unit 4 FUEL Surry Unit 3 Surry Unit 4 North Anna Unit 3 North Anna Unit 4 Totals $ $

l FOOTNOTES (1) The North Anna plant percentage will be the 12 month average capability l

for North Anna Units 1 and 2 divided by the 12 month average Vepco system monthly generating capability (excluding purchases). The North Anna fuel percentage will be the 12 month generation for North Anna Units 1 and 2 divided by the Vepco 12 month system generation.

l (2) The amounts not applicable to North Anna Units 1 and 2 will be included in charges for Supplemental Demand, Reserve Capacity and Reserve and Supplemental Energy.

EXHIBIT N Page 7 of 8 Schedule N-3 Page 2 of 3

~

CANCELLATION COSTS -

Total Amount Old Applicable to Dominion Total Amount Annual Amount North Anna Percentage Due From Old Due From Old Units 1 & 2 Ownership Dominion Pnminion (p. 6, col. 3) Interest (Col 1xCol 2) (See Footnote 3)

(Column 1) (Column 2) (Column 3) (Column 1)

PLANT Surry Unit 3 $ $ $

Surry Unit 4 North Anna Unit 3 North Anna Unit 4 FUEL Surry Unit 3

~

Surry Unit 4 North Anna Unit 3 North Anna Unit 4 Totals $- $ $

FOOTNOTES:

(3) A) The anraal a.nounts due from Old Dominion are based upon the methodology heretofore authorized by FERC for Surry Units 3 and 4 and North Anna Unit 4. The annual amounts for North Anna Unit 3 will be determined in accordance with ratemaking methodology authorized by FERC.

EXHIBIT N Page 8 of 8 Schedule N-3 Page 3 of 3

~

~

CANCELLATION COSTS FOOTNOTES: (Continued)

B) Annual amounts are based on number of months remaining on FERC approved ascrtization period after closing date.

i ,

09 d

-n..., -- .--. , , , . .--,.,,,--y,.--,,.,n. , , , , - - - - .

,,-m-, -a, ,,, , , ,-- - , .-- - .,,-, , ,, , ,. . , - -

Page 1 of 4 EXHIBIT O FORM OF PURCHASE MONEY SECOND DEED OF TRUST NOTE OLD DOMINION ELECTRIC COOPERATIVE DUE No. S OLD DOMINION ELECTRIC COOPERATIVE, a Virginia genern-tion and transmission cooperative (herein, together with its successors and assigns, called "Old Dominion"), for value received, hereby promises to pay to the order of VIRGINIA ELEC-TRIC AND POWER COMPANY (herein, together with its successors and assigns, called "Vepco") or assigns, on or before

, as hereinafter provided, the principal sum of Dollars due and payable as indicated on the following schedule:

Date Principal Payment Date Principal Payment

EXHIBIT O Page 2 of 4 and Old Dominion further promises to pay to Vepco interest on any principal payment not made when due at the rate of 300

, basis points above the prime rate of The Chase Manhattan Bank, N.A., in effect from time to time during the period that any principal is due but unpaid. Such interest shall be payable on demand.

Old Dominion may prepay the principal amounts due hereunder in whole or in part at any time and from time to time without penalty or. premium.

All payments and prepayments hereunder (except a pay-ment or prepayment that discharges all indebtedness of Old Do-minion evidenced by this Note) shall be made without present-ment, demand, protest or notice of dishonor, all of which are expressly waived, to such address or account as the holder hereof shall direct, from time to time, by written notice to Old Dominion. All payments and prepayments hereunder shall be in lawful money of the United States of America, and shall be applied first to the payment of interest on any overdue princi-pal and then to payment of the principal hereof.

This Note is one of the two promissory notes referred to in Section 3.04 of the Purchase, Construction and Ownership Agreement dated as of December 28, 1982, but amended and ,

restated on October 17, 1983 (the " Purchase Agreement"), be-tween Old Dominion and Vepco. The provisions of the Purchase Agreement and the rights and obligations of Old Dominion and the rights of Vepco may be modified to the extent permitted by I

-e

EKHIBIT O Page 3 of 4 and as provided in the Purchase Agreement. This Note /ps/\

secured by a Second Deed of Trust of even date herewith, given by Old Dominion to , as trustee (the " Trustee"), con-veying an 11.6 percent undivided interest in certain real prop-erty briefly described as Vepco's North Anna Power Station, situated in the Counties of Louisa, Orange and Spotsylvania, Virginia, and more particularly described in Schedule A to such Second Deed of Trust. This Note is executed by the Trustee solely for the purpose of identification, and the Trustee shall neither be nor be deemed to be liable hereunder, under such Second Deed of Trust, or in any other manner whatsoever as a result of such execution.

Upon the occurrence and during the continuance of an Event of Default under the Purchase Agreement, the principal hereof and any interest on overdue principal may be declared to be due and payable forthwith as provided in the Purchase Agree-ment. Should this Note or the indebtedness represented by this Note be placed in the hands of attorneys for collection after default, Old Dominion agrees to pay, in addition to the princi-pal and any interest due and payable hereon, all costs of

, collecting this Note, including reasonable attorneys' fees and expenses.

IN WITNESS WHEREOF, Old Dominion Electric Cooperative has caused this Note to be duly executed by its President or one of its Vice Presidents and its corporate seal to be affixed hereto and attested by its Secretary or one of its Assistant Secretaries.

)

. I EXHIBIT O 1 Page 4 of 4  :

1 i

Dated: , 1983 OLD DOMINION ELECTRIC COOPERATIVE By President

[ SEAL]

ATTEST:

Secretary P

I e

i 1

i

,- , , - , , , . - - , , . - , . . . _ . . , , - , . . , . , . , , , , , , . . -,,n-m,n,,-,.,_w, ,. _nnn,.,..

_ .,,,,,,,,-.n,,,,,.,,---,

m.,,_,-y,,,,m-,.,_,--r_, c.

1 1

1 Page 1 of 9 l l

EXHIBIT P RELEASE AND COVENANT NOT TO SUE This Release and Covenant Not to Sue (hereinafter "this Release"), made this day of , 1983, by (Old Dominion or Old Dominion Member], hereinafter referred to as the Releasor, provides:

RECITALS:

A. Old Dominion and Vepco have entered into a Pur-chase, Construction and Ownership Agreement, dated as of December 28, 1982, but amended and restated on October 17, 1983, for the sale by Vepco to Old Dominion of an undivided

~

ownership interest in the Facilities, which Agreement gives Old Dominion and its members access to bulk power generation facil-ities on reasonable terms.

B. Old Dominion and Vepco have also executed an Interconnection and Operating Agreement, dated as of December 28, 1982, but amended and restated on October 17, 1983, providing for the operation of Old Dominion's Percentage Owner-ship Interest in the Facilities and for Vepco to supply supple-mental and reserve capacity and energy from Vepco's generating facilities other than those in which Old Dominion has a per-centage ownership interest and to transmit to Old Dominion en-ergy and capacity purchased from others or generated at Old Dominion's generating facilities.

l

EXHIBIT P Page 2 of 9 C. Old Dominion and Vepco have also entered into a Nu-clear Fuel Agreement, dated as of December 28, 1982, but amended and restated on October 17, 1983, to provide Old Domin-ion its percentage ownership interest in the nuclaar fuel to be used in North Anna Units 1 and 2.

D. With respect to the foregoing agreements, Vepco and

-Old Dominion have bargained at arms length and in good faith and on equivalent terms for economic benefits to each of them which produce an overall result considered just and reasonable, and they have each been represented by competent counsel in all matters relating to this Release.

E. As a part of the foregoing economic benefits, Vepco has agreed to execute and deliver to old Dominion and to each Old' Dominion Member a Release and Covenant Not to Sue. Old Do-minion and each of the Old Dominion Members have agreed to exe-cute and deliver to Vepco reciprocal Releases and Covenants Not to Sue. In executing these Releases-and Covenants Not to Sue, Old Dominion, each Old Dominion Member and Vepco deny wrongdo-ing of any kind whatsoever, and it is mutually agreed by Vepco and Releasor that this Release is not and shall not be deemed evidence of any wrongdoing.

I EXHIBIT P Page 3 of 9 NOW THEREFORE, in consideration of the mutual cove-nants, agreements, warranties and representations set forth or referred to herein, Releasor, on behalf of or for itself and its departments, agencies, councils, managers, officers, directors, agents, employees and members, and its or their predecessors, successors, affiliates, and assigns, and any per-son or entity claiming by, through or under it or them, agrees as follows:

1. (A) Except as reserved in paragraph 2 hereof, un-conditionally to remise, release and forever discharge (or, if necessary to preserve rights against others, instead covenant not to sue pursuant to paragraphs 1(B) and 3 hereof) Vepco, its

. predecessors, successors and assigns, and its past and present officers, directors,' agents and employees, from all claims, de-mands, causes of action, obligations, damages and liabilities of every type and description, including, without restricting the generality of the foregoing, all claims for costs, expens-es, attorney's fees and all other related or similar claims of whatever kind, whether now known or hereafter discovered, which

( are based in whole or in part on or arise out of any conduct, act, practice or omission or any other matter or event which occurred or is alleged to have occurred on or prior to the ef-fective date of this Release and is claimed to violate (1) any state or federal antitrust, trade regulation or unfair competi-l tion law, (2) the Federal Power Act, the Atomic Energy Act, or any similar or related state or federal act, law or statute and

EXHIBIT P Page 4 of 9 any amendment to any of said acts, laws, or statutes, insofar as such act, law, statute or amendment may give rise to liabil-ity for monopolistic, anticompetitive or unfairly competitive  !

l acts, conduct or omissions, or unduly discriminatory or prefer-ential rates, charges, classifications, rules or regulations, including all claims for damages, refunds, injunctive relief or any other form of relief or action by an administrative or reg-

-ulatory agency or other entity charged with carrying out or enforcing any said act, law, statute or amendmeht, or for costs, expenses or attorney's fees, or (3) the statutory or  !

common law of any state relating to tortious or conspiratorial interference with contractual or business relationships which is anticompetitive or unfairly competitive in intent or effect; and (B) Except as reserved in paragraph 2 hereof, not to bring, commence, initiate, maintain, assist, participate voluntarily in or prosecute any action at law, proceeding in equity or any other proceeding (including, without limitation, proceedings at or before the Federal Energy Regulatory Commis-sion or any successor agency, at or before the Nuclear Regula-tory Commission or any successor agency, or at or before any other administrative or regulatory agency) or claim for damages or relief of any kind or description, whether now known or j hereafter discovered, against Vepco, its predecessors, succes-sors and assigns, and its past and present officers, directors, agents and employees, based in whole or part on or arising out t

l l

j EXHIBIT P Page 5 of 9 of any conduct, act, practico or omission or any other matter or event which occurred or is alleged to have occurred on or prior to the effective date of this Release, where such claim, cause of action or other proceeding asserts a violation of (1) any state or federal antitrust, trade regulation or unfair com-petition law, (2) the Federal Power Act, the Atomic Energy Act, or any similar or related state or federal act, law or statute, and any amendment to any of said acts, laws or statutes, insofar as such act, law, statute or amendment may give rise to liability for monopolistic, anticompetitive or unfairly compet-itive acts, conduct or omissions, or unduly discriminatory or preferential rates, charges, classifications, rules or regula-tions, including all claims for damages, refunds, injunctive relief or any other form of relief or action by an administra-tive or regulatory agency or other entity charged with carrying out or enforcing any said act, law, statute, or amendment, or for costs, expenses or attorney's fees or (3) the statutory or common law of any state relating to tortious or conspiratorial interference with contractual or business relationships which is anticompetitive or unfairly competitive in intent or effect.

l (C) The release and covenant not to sue set forth in subparagraphs (A) and (B) above specifically include, but are not limited to, any claim, demand, cause of action, obliga-tion, damage or liability, of every type and description, whether now known or hereafter discovered, which is based on, arises out of or relates in any way to any act, practice or f

EXHIBIT P Page 6 of 9 omission (1) that was raised in the section entitled "Anticompetitive, Antitrust Conduct and Posture of VEPCO" of the " Petition to Intervene of Old Dominion Electric Coopera-tive, Northern Neck Electric Cooperative, North Carolina Elec-tric Membership Corporation and Roanoke Electric Membership t

l Corporation; and Their Motion to Reject the Company's Applica-tion Until the Same Meets rhe Commission's Filing Requirements; and Their Motion to Suspend the Rates Applied For, When Proper-ly Filed, for the Full Statutorily Allowable Five Months Peri-od," dated December 20, 1974 from William T. Crisp to Kenneth F. Plumb, Secretary of the Federal Power Commission, which were filed in Federal Power Commission Docket No. E-9147; or (ii) that relates to the Application (Case No. 9555) by Old Dominion to the Virginia Commission in 1950 for approval of the issuance of securities for construction of a generation and transmission system.

2. This Release may be pleaded as a full and complete i

defense to, and may be used as the basis for an injunction against, any action, suit, claim or other proceeding institut-ed, prosecuted, attempted or maintained by Releasor or any other entity, jointly or severally, which is covered by or breaches this Release; except that this Release shall not be a bar to any claims raised by Old Dominion or any of its Members l before the Federal Energy Regulatory Commission or any succes-l

sor agency, in connection with any application for a rate in-crease made by Vepco to the Federal Energy Regulatory

EXHIBIT P Page 7 of 9 Commission or any successor agency, to the extent that such claims relate to any rate increase requested for any period be-tween July 15, 1983 and the Closing. With respect to any dis-covery, whether formal or informal, instituted or sought by the Releasor or any group or organization of which it may be a mem-ber, relating to the rights retained by this paragraph, the Re-leasor agrees that it will seek only such discovery which is directly related to the rights reserved by this paragraph, and further agrees that as to any objection to any such discovery by Vepco the burden shall be on the Releasor to establish a di-rect relationship between the discovery being sought and the rights reserved in this paragraph. Releasor agrees that the rights reserved in this paragraph shall be narrowly construed.

3. This Release shall not be a bar to any claim that Releasor may have against any person, firm, corporation, asso-ciation or other entity other than those specified in this Re-lease which may have been a joint tort-feasor or co-conspirator with Vepco with respect to any matter relating to this Release.

'Vepco and the Releasor agree, therefore, that this Release shall constitute a covenant not to sue where and to the extent l

necessary to preserve all rights against any and all such al-l leged joint tort-feasors or co-conspirators.

4. Releasor acknowledges that this Release is not based upon any factual, legal or other representations, promis-es or assurances, oral or otherwise, made by Vepco and not contained in this document or the Basic Agreements; and l

---

,~.-e-. - - ---p ,,,,.s-.-aw- --.g , - - , ,--.-,-w-w -

, . - - , - . ,,, , -s--,vv w ,- , - -, - , , n - , - ,-

EXHIBIT P Page 8 of 9 Releasor expressly assumes the risk that the facts or law with respect to which this Release is executed are or may be found hereafter to be different from the facts or law believed by the i Releasor to be true as of the date of this Release, and agrees that this Release shall be effective notwithetanding any such difference.

5. Releasor acknowledges that the Basic Agreements may be amended from time to time. Releasor also acknowledges that the Basic Agreements provide that Vepco may assign, transfer or convey any or all of its interests in the Facilities at any time without the consent of Old Dominion, provided that no such assignment, transfer or conveyance shall diminish the interests or rights of Old Dominion in the Facilities or under the Basic Agreements. In the event of any such amendment, assignment, transfer or conveyance, this Release shall remain in full force and effect as to Vepco.

6. Releasor agrees that this Release is and shall be binding on the predecessors, successors and assigns of Releasor and any persons or entities claiming through, by or under it or them, and shall inure to the benefit of Vepco and its succes-sors and assigns.

7. Releasor represents and warrants that it has not made or suffered to be made any assignment or transfer of any claim herein purported to be released or as to which it has herein covenanted not to sue.

I I

EXHIBIT P Page 9 of 9

8. In the event that any court or other tribunal or agency of competent jurisdiction at any time holds that any provision of this Release is invalid or unenforceble, the re-maining provisions shall not be affected by such holding and shall continue in full force and effect.

9. This Release is the entire agreement between Vepco l and the Releasor as to the subject matter covered by this Re-lease and any related matters, and cannot be changed or modified except by written agreement between Vepco and the Re-leasar.

10. This Release shall become effective as of the Closing Date under the Purchase, Construction and Ownership Agreement.

11. Terms used but not defined herein shall have the j meaning assigned thereto under the Purchase, Construction and Ownership Agreement.

t

12. The recitals set forth herein and designated A through E are made a part of this Release.

IN WITNESS WHEREOF, Releasor has caused this Release

. and Covenant Not to Sue to be signed and sealed by its duly au-l thorized representative.

! By Releasor Title

Page 1 of 7 EXHIBIT Q (Letterhead of Litten, Sipe and Miller]

, 1983 Virginia Electric and Power Company One James River Plaza Richmond, Virginia 23261 Heron, Burchette, Ruckert & Rothwell Suite 420 """"""""""""""

1200 New Hampshire Avenue, N.W.

Washington, D. C. 20036 Purchase, Construction and Ownership Agreement betveen Virginia Electric and Power Company and Old Dominion Electric Coooerative

Dear Sirs:

I We refer to the Purchase, Construction and Ownership Agreement (the " Agreement") dated as of December 28, 1982, but amended and restated on October 17, 1983, between Virginia l Electric and Power Company, a Virginia public service corpora-l l

tion ("Vepco") and Old Dominion Electric Power Cooperative, a Virginia generation and transmission cooperative ("Old Domin-l ion"), and in particular to the provisions of Section 6.01(j) of the Agreement, which call for the delivery of an opinion by us, as counsel for Old Dominion, to which Vepco is today l

l l

l l

l l

EXEIBIT Q Page 2 of 7 transferring an undivided interest in certain electric generating facilities pursuant to the Agreement.

In such capacity, we have examined the following docu-ments:

1.' Executed counterpart of the Interconnection and Operating Agreement (the " Interconnection and Operating Agree-ment") dated as of December 28, 1982, but amended and restated on October 17 1983, between Vepco and Old Dominion.

2. Executed counterparts of the several wholesale power contracts between Old Dominion and the Old Dominion Mem-bers (as such term is defined in the Agreement) for the pur-chase of electric energy and capacity by the Old Dominion Mem-bers from Old Dominion (the " Wholesale Power Contracts").

3. Executed counterpart of the Nuclear Fuel Agreement (the " Nuclear Fuel Agreement") dated as of December 28, 1982, but amended and restated on October 17, 1983, between Vepco and Old Dominion.

4. Counterparts of the several instruments entitled

" Release and Covenant Not to Sue" executed in favor of Vepco by j Old Dominion and the Old Dominion Members, each in the form of Exhibit P to the Agreement (the " Release").

5. Executed counterpart of the Agreement.

i l 6. That certain Loan Guarantee Authorization (the

" Loan Authorization") issued by the Rural Electrification Ad-ministration on behalf of Old Dominion on September 30, 1983, in the amount of $263 million.

l I

i

EXHIBIT Q Page 3 of 7

7. Executed counterparts of deed of conveyance between '

Vapco and Old Dominion, dated , 1983, in the form '

of Exhibit G to the Agrecment (the " Deed").

8. Executed counterparts of the assignment agreement between Vepco and Old Dominion, dated , 1983, in the form of Exhibit H to the Agreement (the " Assignment Agree-ment").

9. Executed counterparts of the bill of sale between i

=

Vepco and Old Dominion, dated , 1983, in the form of Exhibit I to the Agreement (the " Bill of Sale").

10. Executed counterparts of the purchase money second deed of trust from Old Dominion, dated , 1983, in the form of Exhibit J to the Agreement (the "Second Deed of Trust").

11. Executed counterparts of the purchase money second deed of trust notes from Old Dominion, dated , 1983, in the form of Exhibit O to the Agreement, (the " Notes").

We have also reviewed the relevant corporate proceed-4 ings of Old Dominion and have examined originals or copies car-tified to our satisfaction of corporate records of Old Domin-ion, certificates of public officials and of officers and rep-resentatives of Old Dominion, and such other documents as we have deemed necessary as a basis for the opinions hereinafter 4

expressed. In such examination, we have assumed the genu-ineness of all signatures and the authenticity of all documents submitted to us as originals and the conformity with originals of all documents submitted to us as certified copies.

EXHIBIT Q Page 4 of 7 For purposes of the opinions expressed below in para-graphs 1, 4, 5, 6, 7 and 8, insofar as such opinions relate to the Old Dominion Members or instruments or transactions to which the Old Dominion Members are parties, we have relied upon the* opinions of counsel for the Old Dominion Members, copies of which are attached hereto, and we believe that we and you are justified in relying upon such opinions.

We are of the opinion that:

1. Old Dominion is a generation and transmission coop-erativa, and each of the Old Dominion Members is a Virginia co-operative, in each case duly organized, validly existing and in good standing under the laws of the Commonwealth of Virginia, with the corporate power under the laws of Virginia to acquire and own its properties and to carry on its business and to enter into and perform its obligations under the Agreement, the 1 Interconnection and Operating Agreement, the Nuclear Fuel Agreement, the Deed, the Second Deed of Trust, the Bill of Sale', the Assignment Agreement, the Notes, the Wholesale Power Contracts, the Loan Authorization and the Release.

2. All necessary corporate proceedings by Old Dominion have been duly taken to authorize the transactions contemplated by the Agreement, the Interconnection and Operating Agreement, the Nuclear Fuel Agreement, the Deed, the S3cond Deed of Trusc, f the Bill of Sale, the Assignment Agreement, the Notes, the Wholesale Power Contracts, the Loan Authorization and the Re-

! lease executed by old Dominion, and the performance by Old Dominion of its obligations thereunder.

l

EXHIB1T Q '

Page 5 of 7

3. The Agreement, the Interconnection and Operating Agreement, the Nuclear Fuel Agreement, the Deed, the Second Daed of Trust, the Bill of Sale, the Assignment Agreement, the Notes, the Wholesale Power Contracts and the Release executed by Old Dominion have been duly authorized, executed and delivered by Old Dominion and constitute the legal, valid and binding agreements of Old Dominion.

4. All necessary corporate preceedings by the Old Do-minion Members have been duly taken to authorize the transac-tions contemplated by the Wholesale Power Contracts and the Re-lease executed by the Old Dominion Members and the performance by the Old Dominion Members of their obligations thereunder.

5. The Wholesale Power Contracts and the Releases exe-cuted by the Old Dominion Members have been duly authorized, executed and delivered by the Old Dominion Members and consti-tute the legal, valid and binding agreements of the Old Domin-ion Members.

6. No authorization, consent, waiver, approval or other action by any regulatory body or bodies of the United ,

States of America or of the Commonwealth of Virginia is neces-sary in connection with the execution, delivery or performance by Old Dominion and the Old Dominion Members of the Agreement, the Interconnection and Ope'ating Agreement, the Nuclear Fuel Agreement, the Deed, the Second Deed of Trust, the Bill of Sale, the Assignment Agreement, the Notes, the Wholesale Power Contracts and the Release in connection with the validity,

EXHIBZT Q Page 6 of 7 legality or effectiveness of any of such instruments, except for those required to be obtained pursuant to Section 6.02(d) of the Agreement, which have been obtained as represented therein.

7. To the best of our knowledge, there does not exist any litigation, proceeding or governmental investigation pend-ing or threatened against or relating to the transactions con-templated by the Agreement, the Interconnection and operating Agreement, the Nuclear Fuel Agreement, the Deed, the Second Deed of Trust, the Bill of Sale, the Assignment Agreement, the Notes, the Wholesale Power Contracts, the Loan Authorization and the Release.

8. Neither the execution, delivery or performance of the Agreement, the Interconnection and coerating Agresment, the Nuclear Fuel Agreement, the Deed, the Second Deed of Trust, the Bill of Sale, the Assignment Agreement, the Notes, the Whole-sale Power Contracts, the Loan Authorization and the Release has resulted in or will result in any subsisting or future vio-lation of, default under or conflict with, any term or provi-sion of the Articles of Incorporation or the by-laws of Old Do-minion or any Old Dominion Member or of any mortgage, inden-ture, judgment, order or decree (in each case, as presently ex-1 sting) applicable to Old Dominion or, to the best of our knowledge, any Old Dominion Member, or has resulted in or will result in any subsisting or future violation of, default under or conflict with, any term or provision of any other instrument

w

+,

,W" EXHIBIT Q Page 7 of 7

, or agreement (in each case, as presently existing) applicable to Old Dominion or any Old- Domi~nion Member, or to the best of our knowledge, has resulted in or will result in the creation orimpositionofan[ lien', chargenor encumbrance upon any of

~ '

the properties or assets of Old Dominion or any Old Dominion Member.

9. The Loan Authorization, in the amount of $263 mil-lion, is in full force and effect, enforceable in accordance with its terms (except to the extent that the enforceability thereof is subject to provisions of bankruptcy, insolvency or other laws affecting creditors rights in general and general principles of equity) and constitutes a legal, valid and bind-ing agreement.between Old Dominion and the government of the United States of America acting through the Rural Electrifica-tion Administration.

Very truly yours, LITTEN, SIPE AND MILLER l

l l

l i

Page 1 of 7 I

l i

EXHIBIT R

[ Letterhead of Heron, Burchette, Ruckert & Rothwell)

, 1983 Virginia Electric and Power Company One James River Plaza Richmond, Virginia 23261 Purchase, Construction and Ownership Agreement between Virginia Electric and Power Company and Old Dominion Electric Coooerative

Dear Sirs:

We refer to the Purchase, Construction and Ownership Agreement (the " Agreement") dated as of December 28, 1982, but amended and restated on October 17, 1983, between Virginia Electric and Power Company, a Virginia public service corpora-tion ("Vepco") and Old Dominion Electric 2ower Cooperative, a Virginia generation and transmission cooperative ("Old Domin-ion"), and in particular to the provisions of Section 6.01(j) of the Agreement, which call for the delivery of an opinion by us, as counsel for Old Dominion, to which Vepco is today trans-ferring an undivided interest in certain electric generating facilities pursuant to the Agreement.

In such capacity, we have examined the following docu-ments:

,- - - - -- , , . ,g -- _ , - - - . - - - .-y, -,,--.-e--- - - . - -1

EXEIBIT R 1 Page 2 of 7

1. Executed counterpart of the Interconnection and Operating Agreement (the " Interconnection and Operating Agree-ment") dated as of December 28, 1982, but amended and restated on October 17, 1983, between Vepco and Old Dominion.

2. Executed counterparts of the several wholesale power contracts between Old Dominion and the Old Dominion Mem-bers (as such term is defined in the Agreement) for the pur-chase of electric energy and capacity by the Old Dominion Mem-bers from Old Dominion (the " Wholesale Power Contracts").

3. Executed counterpart of the Nuclear Fuel Agreement (the " Nuclear Fuel Agreement") dated as of December 28, 1982,

,but amended and restated on October 17, 1983, between Vepco and Old Dominion.

4. Counterparts of the several instruments entitled

" Release and Covenant Not to Sue" executed in favor by Vepco of Old Dominion and the Old Dominion Members, each in the form of Exhibit P to the Agreement (the " Release").

5. Executed counterpart of the Agreement.

6. That certain Loan Guarantee Authorization (the

" Loan Authorization") issued by the Rural Electrification Ad-ministration on behalf of Old Dominion on September 30, 1983 in the amount of,$263 million.

7. Executed counterparts of deed of conveyance between Vepco and Old Dominion, daced , 1983, in the form of Exhibit G to the Agreement (the " Deed").

EKHIBIT R Page 3 of 7

8. Executed counterparts of the assignment agreement between Vepco and Old Dominion, dated , 1983, in the fe;m of Exhibit H to the Agreement (the " Assignment Agree-ment").

9. Executed counterparts of the bill of sale between Vepco and Old Dominion, dated , 1983, in the form of Exhibit I to the Agreement (the " Bill of Sale").

10. Executed counterparts of the purchase money second deed of trust from Old Dominion, dated , 1983, in the form of Exhibit J to the Agreement (the "Second Deed of Trust").

11. Executed counterparts of the purchase money second deed of trust notes from Old Dominion, dated , 1983, in the form of Exhibit O to the Agreement, ( -he " Notes" ) .

We have also reviewed the relevant corporate proceed-ings of Old Dominion and have examined originals or copies cer-tified to our satisfaction of corporate records of Old Domin-lon, certificates of public officials and of officers and rep-resentatives of Old Dominion, and such other documents as we have deemed necessary as a basis for the opinions hereinafter expressed. In such examination, we have assumed the genu-ineness of all signatures and the authenticity of all documents submitted to us as originals and the conformity with originals of all documents submitted to us as certified copies.

As to opinions expressed herein governed by laws of the Commonwealth of Virginia, we have relied on the opinion of

, .-.4 . . - - , .. - ..r....-. v. - .....,..,~..-_<_....,,.,.,.-.,y-.,,. -

.-,,,...w_. -~,,,,n. 7,. ,, _ .,, -~ ,

EXEIETT R Page 4 of 7 Litten, Sipe and Miller, members of the Bar of the Commonwealth of Virginia, on whom we believe you and we are justified in relying. For purposes of the opinions expressed below in para-graphs 1, 4, 5, 6, 7 and 8, insofar as such opinions relate to the Old Dominion Members or instruments or transactions to which the Old Dominion Members are parties, we have also relied upon the opinions of counsel for the Old Dominion Members, copies of which are attached hereto, and we believe that we and you are justified in relying upon such opinions.

We are of the opinion that:

1. Old Dominion is a generation and transmission coop-erative, and each of the Old Dominion Members is a Virginia co-operative, in each case duly organized, validly existing and in good standing under the laws of the Commonwealth of Virginia, with the corporate power under the laws of Virginin to acquire and own its properties and to carry on its business and to enter into and perform its obligations under the Agreement, the l

Interconnection and Operating Agreement, the Nuclear Fuel l Agreement, the Deed, the Second Deed of Trust, the Bill of Sale, the Assignment Agreement, the Wholesale Power Contracts, the Loan Authorization and the Release.

( 2. All necessary corporate proceedings by Old Dominion have been duly taken to authorize the transactions contemplated by the Agreement, the Interconnection and Operating Agreement, l

the Nuclear Fuel Agreement, the Deed, the Second Deed of Trust, the Bill of Sale, the Assignment Agreement, the Notes, the i

., , . -. . . _ ......m._ _....._,-__,-.,.__,_,..,,_m___,,._.__,,..v_ m._,,. , .,_ - , , . . . . . . - . , , - - -

EXHIBIT R Page 5 of 7 P

Wholesale Power Contracts, the Loan Authorization and the Release executed by Old Dominion, and the performance by Old Dominion of its obligations thereunder.

3. The Agreement, the Interconnection and Operating Agreement,~the Nuclear Fuel Agreement, the Deed, the Second l Deed of Trust, the Bill of Sale, the Assignment Agreement, the Notes, the Wholesale Power Contracts and the Release executed by Old Dominion have been duly authorized, executed and delivered by Old Dominion and constitute the legal, valid and binding agreements of the Cooperative.

4. All necessary corporate proceedings by the Old Do-minion Members have been duly taken to authorize the transac-tions contemplated by the Wholesale Power Contracts and the Re-lease executed by the Old Dominion Members and the performance by the Old Dominion Members of their obligations thereunder.

5. The Wholesale Power Contracts and the Release exe-cuted by the Old Dominion Members have been duly authorized, executed and delivered by the Old Dominion Members and consti-l tute the legal and binding agreements of the Old Dominion Mem-bers.

l 6. No authorization, consent, waiver, approval or other action by any regulatory body or bodies of the United States of America or of the Commonwealth of Virginia is neces-sary in connection with the execution, delivery or performance by Old Dominion and the Old Dominion Members of the Agreement,

, the Interconnection and Operating Agreement, the Nuclear Fuel

EXHIBIT R Page 6 of 7 Agreement, the Deed, the Second Deed of Trust, the Bill of Sale, the Assignment Agreement, the Notes, the Wholesale Power -

Contracts and the Release in connection with the validity, le-gality or effectiveness of any of such instruments, except for those required to be obtained pursuant to Section 6.02(d) of the Agreement, which have been obtained as represented therein.

7. To the best of our knowledge, there does not exist any litigation, proceeding or governmental investigation pend-ing or threatened against or relating to the transactions con-templated by the Agreement, the Interconnection and Operating Agreement, the Nuclear Fuel Agreement, the Deed, the Second Deed of Trust, the Bill of Sale, the Assignment Agreement, the Notes, the Wholesale Power Contracts, the Loan Authorization and the Release.

8. Neither the execution, delivery or performance of the Agreement, the Interconnecticn and Operating Agreement,'the Nuclear Fuel Agreement, the Deed, the Second Deed of Trust, the Bill of Sale, the Assignment Agreement, the Notes, the Whole-sale Power Contracts, the Loan Authorization and the Release has resulted in or will result in any subsisting or future vio-lation of, default under or conflict with, any term or provi-sion of the Articles of Incorporation or the by-lawr. of Old Do-minion or any old Dominion Member or of any mortgage, inden-ture, judgment, order or decree (in each case, as presently ex-isting) applicable to Old Dominion or, to the best of our knowledge, any Old Dominion Member, or has resulted in or will

EXHIBIT R Page 7 of 7

. result in any subsisting or future violation of, default under or conflict with, any term or provision of any other instrument or agreement (in each case, as presently existing) applicable to Old Dominion or any Old Dominion Member, or to the best of our knowledge, has resulted in or will result in the creation or imposition of any lien, charge or encumbrance upon any of the properties or assets of Old Dominion or any Old Dominion Member.

9. The Loan Authorization, in the amount of $263 mil-

! lion, is in full force and effect, enforceable in accordance with its terms (except to the extent that the enforceability thereof is subject to provisions of bankruptcy, insolvency or other laws affecting creditors rights in general and general principles of equity) and constitutes a legal, valid and bind-ing agreement between Old Dominion and the government of the United States of America, acting through the Rural Electrifica-tion Administration.

I Very truly yours, HERON, BURCHETTE, RUCKERT & ROTHWELL i

i I

l l

I l

Page 1 of 7 EXHIBIT S RELEASE AND COVENANT NOT TO SUE BY VIRGINIA ELECTRIC AND POWER COMPANY This Release and Covenant Not to Sue (sometimes herein-after referred to as "this Release"), made this day of

, 1983, by Virginia Electric and Power Company for itself, its affiliate companies, predecessors, successors and assigns, (hereinafter sometimes referred to as "Vepco"), in favor of Old Dominion Electric Cooperative and its Members (sometimes hereinafter referred to as "Old Dominion"), pro-vides:

RECITALS:

A. Old Dominion and Vepco have entered into a Pur-chase, Construction and Ownership Agreement, dated as of l December 28, 1982, _but amended and restated on October 17, 1983, for the sale by Vepco to Old Cominion of an undivided ownership interest in the Facilities, which Agreement gives Old Dominion and its members access to bulk power generation facil-ities on reasenable terms.

B. Old Dominion and Vepco have also executed an Interconnection and Operating Agreement dated as of December 28, 1982, but amended and restated on October 17, 1983.

providing for the operation of Old Dominion's Percentage

EXHIBIT S Page 2 of 7 Ownership Interest in the Facilities and for Vepco to supply supplemental and reserve capacity and energy from Vepco's generating facilities other than those in which Old Dominion has a Percentage Ownership Interest and to transmit to Old Do-minion energy and capacity purchased from others or generated at Old Dominion's generating facilities.

C., Old Dominion and Vepco have also entered into a Nu-clear Fuel Agreement, dated as of December 28, 1982, but amended and restated on October 17, 1983, to provide Old Domin-ion its percentage ownership interest in the nuclear fuel to be used in North Anna Units 1 and 2.

D. With respect to the foregoing agreements, Vepco and Old Dominion have bargained at arms length and in good faith and on equivalent terms for economic benefits to each of them which produce an overall result considered just and reasonable, and they have each been represented by competent counsel in all matters relating to this Release.

E. As a part of the foregoing economic benefits, Vepco has agreed to execute and deliver to Old Dominion and to each of the Old Dominion Members a' Release and Covenant Not to Sue.

Old Dominion and each of the Old Dominion Members have agreed to execute and deliver to Vepco reciprocal Releases and Cove-nants Not to Sue. In executing these Releases and Covenants Not to Sue, Old Dominion, each Old Dominion Member and Vepco deny wrongdoing of any kind whatsoever, and it is mutually

- _ _ . __. . _ . . _ . . - . . _ _ _. _ .._ _ - . . , .,~ __ .

1 EXHIBIT S Page 3 of 7 agreed by Vepco, Old Dominion, and each Old Dominion Member that this Release is not and shall not be deemed evidence of any wrongdoing.

NOW THEREFORE, in consideration of the mutual cove-nants, agreements, representations, benefits and warranties set forth or noted, Vepco agrees as follows:

1) That the foregoing recitals are made a part of this Release.

2) For the purposes of this Release, each and every reference to the terms "Old Dominion Members", " antitrust laws of the United States" and "the antitrust laws of Virginia" shall have the following meanings respectively:

(a) The term "Old Dominion Members" shall include all departments, agencies, councils, managers, officers, em-ployees, predecessors, successors, affiliates and assigns of such member.

(b) " Antitrust 1sws of the United States" shall mean the following acts, and all amendments thereto:

1) "An Act to protect trade and commerce against unlawful restraints and monopolies," approved July 2, 1890 (the "Sherman Act");

2) Sections 73 to 76, inclusive, of an Act entitled "An Act to reduce taxation, to provide revenue for Government, and for other purposes," approved August 27, 1894 (the " Wilson Tariff Act");

EXHIBIT S Page 4 of 7

3) "An Act to supplement existing laws against unlawful restraints and monopolies, and for other pur-poses," approved October 15, 1914 (the "Clayton Act"); and

4) "An Act to create a Federal Trade Commis-sion, to define its powers and duties, and for other purposes,"

approved September.26, 1914 (the " Federal Trade Commission Act").

(c) " Antitrust laws of Virginia" shall mean the antitrust provisions of the Constitution of Virginia, Title 59.1 of the Code of Virginia, as amended, and any implementing regulations promulgated by any Agency of the Commonwealth of Virginia.

(d) Other terms used herein shall have the respec-i -tive meanings set forth in the Purchase, Construction and Own-l l ership Agreement.

3. Vepco, for itself, its subsidiaries, divisions, de-partments, predecessors, successors, assigns, affiliated compa-nies, and any person or entity claiming through, by or under it or them, remises, releases and forever discharges Old Dominion from all claims, liabilities, causes of action and damages of every type and description arising at any time prior to the date of this Release, under or based upon (a) the antitrust a

[ laws of the United States, the antitrust laws of Virginia, or the antitrust laws of any other state; (b) the Federal Power Act and the Atomic Energy Act and any amendment to any of said

, _ . , - - - - , . -. .L..----.------_-..,-.

EXHIBIT S Page 5 of 7 F

acts or laws insofar as such acts or laws give rise to liability for anticompetitive or unfairly competitive conduct or activity, including all claims for damages or other forms of relief, or for attorneys' fees, costs and expenses; and (c) claims arising under the statutes or common law of any state relating to tortious interference with contractual relation-ships which is anticompetitive or unfairly competitive in in-tent or effect,

4. This Release shall not constitute a release as to any claim of any type that Vepco may have against any person, firm, corporation, association or other entity which may have been a joint tort-feasor or co-conspirator with Old Dominion or with any of the Old Dominion Members. Vepco and Old. Dominion agree, therefore, that this Release shall constitute a covenant not to sue where and to the extent necessary to preserve all rights against any and all such alleged joint tort-feasors or conspirators. With respect to such claims, Vepco hereby cove-nants and agrees with Old Dominion and each of the Old Dominion i

Members that nothing in this paragraph shall give Vepco the i right to assert any claim against Old Dominion or any of the i

Old Dominion Members that would otherwise be barred by Para-graph 3. Vepco is free, however, to assert any such claims against any third party, and the assertion of any such claim shall not be a violation of this Release.

EXHIBIT S Page 6 of 7

5. Vecco acknowledges that this Release is not based upon any factual, legal or other representations or promises made by Old Dominion and not contained in this document, the Purchase, Construction and Ownership Agreement, the Interconnection and Operating Agreement, and the Nuclear Fuel Agreement; and it fully understands that if the facts or law with respect to which this Release is executed are or may be found hereafter to be other than, or different from, the facts or law in that connection now believed by Vepco to be true, Vepco expressly accepts and assumes the risk of such possible difference and agrees that this Release herein given shall be and remain effective notwithstanding any such difference.

6. Vepco represents and warrants that it has not made or suffered to be made any assignment or transfer of any claims herein purported to be released, or for which it has covenanted not to sue.

7. Vepco agrees that this Release shall be binding on it, its departments, divisions, predecessors, successors, as-signs, affiliated companies and subsidiaries, and any person claiming through, by or under it or them, and each of them, and shall inure to the benefit of Old Dominion and each Old Domin-ion Member.

8. In the event a court or other tribunal of competent jurisdiction at any time holds that any provision of this Re-lease is invalid, the remainder hereof shall not be affected by such holding and shall continue in full force and effect.

EXHIBIT.S Page 7 of 7

9. This Release shall become effective as of the Closing Date under the Purchase, Construction and Ownership Agreement.

IN WITNESS WHEREOF, Vepco has caused these presents to be signed and sealed, as of the day and year first above mentioned, by its representatives thereunto duly authorized.

VIRGINIA ELECTRIC AND POWER COMPANY By:

Title:

ATTEST:

Assistant Corporate Secretary 5

.4- - -.._.u- - . _ _ .. ___ , , . , , _ _ , . . - . . . _ , - . . , _ . , ~ . _ _ , , - _ _ _

e

[

i Page 1 of 5 EXHIBIT T

[ Letterhead of Hunton & Williams]

, 1983 Old Dominion Electric Cooperative 5601 Chamberlayne Avenue Richmond, Virginia 23227 Purchase, Construction and Ownership Agreement between Virginia Electric and Power Company and Old Dominion Electric Coooerative

Dear Sirs:

We refer to the Purchase, Construction and Ownership Agreement dated as of December 28, 1982, but amended and restated on October 17, 1983 (the " Agreement"), between Virginia Electric and Power Company, a Virginia public service corporation ("Vepco") and Old Dominion Electric Cooperative, a Virginia generation and transmission cooperative ("Old Domin-ion"), and in particular to the provisions of Section 6.02(j) of the Agreement, which call for the delivery of an opinion by us, as counsel for Vepco, which is today transferring an undi-vided interest in certain electric generating facilities to Old Dominion pursuant to the Agreement. Terms defined in the Agreement and not otherwise defined herein ere used herein as so defined.

In such capacity, we have examined the following documents:

EXHIBIT T Page 2 of 5

1. Executed counterparts of deed of conveyance between Vepco and Old Dominion, dated , 1983, in the form of Exhibit G to the Agreement (the " Deed of Conveyance").

2. Executed counterparts of the assignment agreement between Vepco and Old Dominion, dated , 1983, in the form of Exhibit H to the Agreement (the " Assignment Agree-ment").

3. Executed counterparts of the bill of sale between Vepco and Old Dominion, dated , 1983, in the form of Exhibit I to the Agraement (the " Bill of Sale").

4. Executed counterparts of the instrument entitled Release and Covenant Not to Sue executed in favor of Old Domin-ion and the Old Dominion Members by Vepco, in the form of Ex-hibit T to the Agreement (the " Release").

5. Executed counterpart of the Interconnection and r

Operating Agreement dated as of December 28, 1982, but amended and restated on October 17, 1983 .the ( " Interconnection and Operating Agreement"), between Vepco and Old Dominion.

6. Executed counterpart of the Nuclear Fuel Agreement l

l dated as of December 28, 1982, but amended and restated on October 17, 1983 (the " Nuclear Fuel Agreement"), between Vepco and Old Dominion.

7. Executed counterpart of the Agreement.

We have also reviewed the rel'evant corporate proceed-ings of Vepco and have examined and, with your approval relied I

upon, originals or copies certified to our satisfaction of i

l

EXHIBIT T Page 3 of 5 corporate records of Vepco, certificates of public officials.

and of officers and representatives of Vepco, and such other l

documents as we have deemed necessary as a basis for the opin-ions hereinafter expressed. In such examination, we have as- ,

sumed the genuineness of all signatures and the authenticity of all documents submitted to us as originals and the conformity with originals of all documents submitted to us as certified copies.

We are of the opinion that:

1. Vepco is a public service corporation duly orga-nized, validly existing and in good standing under the laws of the Commonwealth of Virginia, with the corporate power under the laws of Virginia to acquire and own its properties and to carry on its business, to sell and convey such undivided inter-est by Special Warranty Deed and Bill of Sale, and to enter into and perform its obligations under the Agreement, the Interconnection and Operating Agreement, the Nuclear Fuel Agreement and the Release.

2. All necessary corporate pr'oceedings by Vepco have i

been duly taken to authorize the transactions contemplated by the Agreement, the Interconnection and Operating Agreement, the Nuclear Fuel Agreement and the Release and the performance by Vepco of its obligations thereunder.

3. The Agreement, the Interconnection and Operating Agreement, the Nuclear Fuel Agreement and the Release have been duly authorized, executed and delivered by Vepco and constitute the legal, valid and binding agreements of Vepco.

1 EXHIBIT T Page 4 of 5

4. The Deed of Conveyance, the Assignment Agreement and the Bill of Sale have been duly authorized, executed, ac-knowledged and delivered by Vepco and constitute the legal, valid and binding instruments of Vepco and, subject to the ex-ception set forth in the last paragraph hereof, are formally sufficient to convey to the Cooperative the property interests they purport to convey.

5. The approvals of the regulatory bodies specif-icially listed in Section 6.01(d) of the Agreement have been obtained and are in full force and effect.

6. To the best of our knowledge, there does not exist any litigation, proceeding or governmental investigation pend-ing or threatened against or relating to the transactions con-templated by the Agreement, the Interconnection and Operating Agreement, the Nuclear Fuel Agreement and the Release.

7. Neither the execution, delivery or performance of the Agreement, the Deed of Conveyance, the Assignment Agree-ment, the Bill of Sale, the Interconnection and Operating Agreement, the Nuclear Fuel Agreement and the Release, has resulted in or will result in any subsisting or future viola-tion of, default under or conflict with, any term or provision of the Articles of Incorporation or the By-Laws of Vepco or of any mortgage, indenture, judgment, order or decree applicable to Vepco and known to us, or has resulted in or will result in any subsisting or future material violation of, default under or conflict with, any term or provision of any other instrument

1 l

EXHIBIT T j Page 5 of 5 ,

or agreement applicable to Vepco and known to us, or, to the best of our knowledge, has resulted in or will result in the creation or imposition of any lien, charge or encumbrance upon any of the properties or assets of Vepco, except that we have made no review of, and express no opinion on, contracts, pur-chase orders or other similar documents or agreements that in-volve amounts less than $50,00J.

We have made no examination and express no opinion with respect to titles to any of the property purported to be con-veyed by the Deed of Conveyance, the Bill of Sale or any other properties or with respect to the existence of any liens, charges or encumbrances thereon.

. Very truly yours, HUNTON & WILLIAMS I

I Page 1 of 1 EXHIBIT U r

Measuring Lives John B. Bernhardt John I. Oatts William W. Berry William L. Proffitt James E. Betts Tyndall L. Baucom Milton L. Drewer, Jr. Wadsworth Bugg, Jr.

Mrs. Mary C. Fray Paul G. Edwards Bruce C. Gottwald Gerald C. Headley, Jr.

Dr. Allix B. James Robert F. Hill T. Justin Moore, Jr. Charles M. Jarvis William S. Peebles, III Bill D. Johnson Shirley S. Pierce Ronald H. Leasburg Kenneth A. Randall O. James Peterson, III William T. Roos James T. Rhodes Roy R. Smith William C. Spencer William F. Vosbeck, Jr. William L. Stewart Jack H. Ferguson William N. Thomas Samuel C. Brown, Jr. Linwood R. Robertson l

l l

A PURCHASE, CONSTRUCTION AND OWNERSHIP AGREEMENT

, Between t

VIRGINIA ELECTRIC AND POWER COMPANY and 1

~

OLD DOMINION ELECTRIC COOPERATIVE DATED: As of December 28, 1982

~

Amended and Restated October 17, 1983 I

5 s

~ . - _ , - , - . - _ . . . . _ ,,. . . . . . _ . . . -.._ . , _ ,._....,__ ., _ ___ _.._ _ _____.,.--.___ _ _ __.. ._ __ _ _ _ _____ _ __ _ .____ . _ _ _

TABLE OF CONTENTS Pace Recitals..................................................... 1 Article I - Definitions 1.01 Additional Payments After Closing................. 3 1.02 AFUDC............................................. 3 1.03 Agreement..... .................................. . 4 1.04 Authorized Old Dominion Representatives........... 4 1.05 Authorized Vepco Representatives.................. 4 1.06 Basic Agreements.................................. 4 1.07 Capability........................................ 4 1.08 Closing and Closing Date.......................... 5 1.09 Common Facilities..... . . . . . . . . . . . . . . . . . . . . . . . . . . .5 1.10 Facilities........................................ 5 1.11 FERC.............................................. 5 1.12 Force Majeure..................................... 5 1.13 Indenture of Mortgage............................. 5 1.14 Initial Purchase Price.................... . . . . . . .6 1.15 Interconnection and Operating Agreement. . . . . . . . .6 1.16 Interest Rates................ . . . . . . . . . . . . . . . . . . .6 1.17 Lien.............................................. 6 1.18 Major Spare Parts................................ 7 .

1.19 New Investment.................................... 7 1.20 North Anna Nuclear Power Station........ . . . . . . . . .8 1.21 North Anna Unit 1........ . . . . . . . . . . . . . . . . . . . . . . .8 1.22 North Anna Unit 2.................. . . . . . . . . . . . . ..S 1.23 NRC............................................... 9 1.24 Nuclear Fuel................................... . .9 1.25 Nuclear Fuel Agreement............................ 9 l 1.26 Old Dominion........ ............................ . 9

! 1.27 Old Dominion Members... . . . . . . . . . . . . . . . . . . . . . . . . . .9 1.28 Old Dominion's Percentage Ownership Interest.......................................... 9 1.29 Operating Inventory.............................. 10 1.30 Original Cost.................................... 10 1.31 Parties.......................................... 10 1.32 Permitted Encumbrances........................... 10 1.33 P rudent Utility Practice s . . . . . . . . . . . . . . . . . . . . . . . . 12 1.34 REA.............................................. 12 1.35 SEC........................................... . . .12 1.36 Sup e ri o r Li e n . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12

-i-y *.-7 - g -n-2 -yr-. 9 m-- , , - ,3 , ,- e vs--- -,--+---w =

g- 9se

Page 1.37 Support Facilitics............................... 13 1.38 Uniform System of Accounts....................... 13 1.39 Unit (s).......................................... 14 1.40 Vepco............................................ 14 1.41 The Virginia Commission.......................... 14 1.42 The West Virginia Commission......... . . . . . . . . . . . .14 1.43 Wholesale Power Contracts........................ 16 Article II - Purchase of Old Dominion's Percentage Ownership Interest 2.01 Purchase of Old Dominion's Percentage Ownership Interest in the Facilities at Closing............ 15 2.02- Conveyances...................................... 15 2.03 Entitlement to Capability. . . . . . . . . . . . . . . . . . . . . . . . 16 2.04 Proviso.......................................... 17 2.05 Second Mortgage Lien............................. 17 Article III - Payments for Old Dominion's Percentage Ownership Interest 3.01 Payment.......................................... 18 3.02 Additional Payments After Closing................ 19 3.03 Payments for Retirements and Decommissioning Costs; Cption to Purchase or Lease the Facilities....................................... 22 3.04 Payment of Tax Liability......................... 25 3.05 Cancellation Costs............................... 25 3.06 Payment for Other Costs................ . . . . . . . . . .26 3.07 Me tho d s o f P a ym e n t . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2 6 Article IV - Representations and Warranties 4.01 Representations and Warranties of Vepco.......... 28 4.02 Representations and Warranties of Old Dominion... 30

, 4.03 S u rv i v a l . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3 2 Article V - The Closing and Closing Date 5.01 Time and P1 ace................................... 33 5.02 Termination of Liability......................... 33 l

Article VI - Conditions to Closing 6.01 Conditions Precedent to Vepco's obligations...... 34 6.02 Conditions Precedent to Old Dominion's Obligations................................. . . . . . 39

.-- r -ru,, -

s- - , - - .

,v.- ,.

e. , --e, -y-, , ,m, e a-- -r---- -

Pace Article VII - Nuclear Fuel 7.01 Sale and Purchase of Nuclear Fuel................ 44 Article VIII - Management of the Facilities; Liability and Allocation of Risk; and Contracts for the Facilities 8.01 Vepco as Agent of Old Dominion................... 45 8.02 Contract Assignment and Transfer Limitations...................................... 48 8.03 No Adverse Distinction........................... 48 8.04 Liabilities of the Parties....................... 49 Article IX - General Covenants 9.01 Covenant to Use Best Efforts..................... 52 9.02 Covenants to Provide Information................. 52 9.03 Old Dominion's Covenant to Obtain Financing. . . . . . 52 9.04 Financial Statements and Other Documents......... 53 9.05 Other Covenants.................................. 54 Article X - Waiver of Partition............................ 59 Article XI - Assignment 11.01 Old Dominion' s Right to As sign . . . . . . . . . . . . . . . . . . . 60 11.02 Vepco's Right to Assign.......................... 60 Article XII - Insurance 12.01 General.......... ............................... 62 12.02 Nuclear Property Insurance....................... 62 12.03 Nuclear Liability Insurance... .................. 62 12.04 General Liability Insurance...................... 63 12.05 Workmen's Compensation Insurance................. 63 12.06 Additional Insurance............................. 64 12.07 Allocation and Payment of Premiums............... 64 l Article XIII - Destruction; Condemnation 1

13.01 Destruction.................................... . 66 l 13.02 Condemnation................................ .... 67

-iii-

Pace Article XIV - Force Majeure 14.01 Force Majeure.................................... 69 14.02 Remedy........................................... 70 Article XV - Default 15.01 Events of Default................................ 71 15.02 Penalty for Late Payments........................ 73 15.03 Failure to Make Payments......................... 74 15.04 Acceleration..................................... 77 15.05 Remedies Not Exclusive........................... 78 Article XVI - Special Remedies 16.01 Special Rec.edy...... ............................ 80 16.02 Special Old Dominion Remedy.......................G3 16.03 Failure to Perfcrm-Remedy........................ 86 16.04 Rights and Obligations upon Repurchase or Transfer of Title............. ............... 87 Article XVII - Term of Agreement .

17.01 Termination...................................... 90 17.02 Me a su ring Live s . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9 0 Article XVIII - Accounting Matters 18.01 General Accounting Matters...................... .92 18.02 Right to Inspect Records, Etc.................... 92 18.03 Other Audits..................................... 94 Article XIX - Consultations and Mutual Cooperation; Authorized Representatives 19.01 Consultations and Mutual Cooperation............. 95 19.02 Authorized Old Dominion Representatives.......... 95 19.03 Authorized Vepco Representatives................. 95 19.04 Proportional Voting.............................. 96 Article XX - Miscellaneous 20.01 Sale Without Warranty..................... ...... 97 20.02 Non-Exclusive Sale............................... 97 20.03 No Arbitration; Resolution of Disputes........... 98 20.04 Notices.......................................... 99 20.05 Holidays, Bu sine s s D ay s . . . . . . . . . . . . . . . . . . . . . . . . . 100 20.06 Entire Agreement.... ........................... 100

-iv-

Page 20.07 Amendments...................................... 100 20.08 Severability.... ............................... 101 20.09 Relationship of the Parties..................... 101 20.10 Tax Election.................................... 102 20.11 Governing Law................................... 102 20.12 No Waiver....................................... 102 20.13 Captions........................................ 102 20.14 Counterparts.................................... 102 20.15 Singular and Plural; Gender..................... 1C3 20.16 Equal Opportunity. ............................ .103 20.17 Environment..................................... 106 20.18 Kick-backs...................................... 107 20.19 Nonsegregated Facilities........................ 107 20.20 Confidentiality................................. 109 20.21 Historic P1 aces................................. 109 20.22 Public Officials Not to Benefit................. 110 20.23 Flood Insurance Act............................. 110 20.24 Safety.......................................... 111 20.25 Buy American......................... ....,..... 111 20.26 Merger of Documents.......................... .. 113 Signatures.................... ............................ 114 Exhibits Exhibit A - Common Facilities........ ....................

Exhibit B - Support Facilities............................

Exhibit C - Major Spare Parts........................ ....

Exhibit D - North Anna Unit 1.............................

Exhibit E - North Anna Unit 2.................. .... ....

Exhibit F - Old Dominion Members..........................

Exhibit G - Form of Special Warranty Deed... ....... ....

Exhibit H - Form of Assignment Agreement............ .....

Exhibit I - Form of Bill of Sale..........................

Exhibit J - Form of Second Mortgage and Deed of Trust.....

Exhibit K - Initial Purchase Price Calculation............

Exhibit L - Form of Estimated Expenditures Invoice........

Exhibit M - Payment of Tax Liability at Closing...........

Exhibit N - Deferred Payment Schedule....................

i Exhibi t 0 - Deferred Payment Promissory Note. . . . . . . . . . . . . .

Exhibit P - Form of Old Dominion and Old Dominion Members Release and Covenant Not to Sue.....................................

Exhibit Q - Form of Opinion of Litten, Sipe and Miller....................................

Exhibit R - Form of Opinion of Heron, Burchette, Ruckert & Rothwell....................... .

Exhibit S - Form of Vepco Release and Covenant Not to Sue................................

Exhibit T - Form of Opinion of Hunton & Williams. .......

-v-i l

l

t i

Page Exhibit U - Measuring Lives...............................

1 P

I

-vi-( . - . . , _. - -. . . - - - - - . . . . . - - . . . - . - - - - - - - - - - . - - - - - - - - - - - - - ~ - - - - - - -

THIS PURCHASE, CONSTRUCTION AND OWNERSHIP AGREEMENT, dated as of December 28, 1982, but amended and restated on October 17, 1983, between VIRGINIA ELECTRIC AND POWER COMPANY 1

(Vepco), a Virginia public service corporation with its principal office at One James River Plaza, Richmond, Virginia 23261, and OLD DOMINION ELECTRIC COOPERATIVE (Old Dominion), a Virginia generation and transmission cooperative with its principal office at 5601 Chamberlayne Road, Richmond, Virginia 23227 provides as follows:

WHEREAS, Vepco is a public service corporation engaged t

in furnishing electric utility service in portions of Virginia, North Carolina and West Virginia, and as such owns and operates facilities for the generation, transmission and distribution of electricity within those states; a: '

WHEREAS, Old Dominion is a generation and transmission cooperative organized and existing under the laws of the Commonwealth of Virginia and is comprised of, among others, the Old Dominion Members. Old Dominion is charged with the responsibility of providing power and energy to its old Dominion Members either through generation facilities owned by it or by the purchase of power and energy from others; and WHEREAS, Vepco sells to Old Dominion Members electric service at wholesale for resale; and WHEREAS, the requirements for electric service to customers of Vepco and Old Dominion have grown and continue to grow, and to meet the increasing bulk power supply requirements i

- - . . , , - - . - , - , , . , - , , . - - , - - , - - . , - - , - ,.--v - - - . , , . . - , . . . . . . - - . . . , - , - . . - . - - - --- .---..m-- ,

i of these customers Vepco has constructed and continues to construct, among other things, substantial additions to its generating facilities; and WHEREAS,.Old Dominion is willing to acquire and Vepco is willing to sell undivided ownership interests in North Anna Units 1 and 2, the Common Facilities, the Support Facilities, the Nuclear Fuel used or to be used for North Anna Units 1 and 2 including the undesignated forward inventor'J, the Major Spare Parts and the Operating Inventory; and WHEREAS, simultaneously herewith, Vepco and Old Dominion have entered into an Interconnection and Operating Agreement under which Vepco will provide, among other things, Old Dominion Supplemental Demand and Energy, Reserve Capacity and Energy and certain transmission service; and WHEREAS, under the Interconnection and Operating Agreement, Old Dominion agrees to sell and Vepco agrees to purchase certain percentages of Old Dominion's entitlement to the capacity and associated energy in North Anna Units 1 and 2, respectively; and WHEREAS, simultaneously herewith Vepco and Old Dominion have entered into a Nuclear Fuel Agreement under which Vepco agrees to sell and Old Dominion agrees to purchase an 11.6 percent undivided ownership interest in the Nuclear Fuel used

- . _.-. _, - - - . = -

or to be used for North Anna Units 1 and 2 as well as the appropriate undivided ownership interest in the undesignated forward inventory as prescribed by the Nuclear Fuel Agreement; and WHEREAS, Vepco and Old D, minion agree to participate in such joint ownership since such ownership is expected to confer reasonable net benefits upon Vepco and Old Dominion; NOW, THEREFORE, in consideration of the premises and the mutual obligations hereinafter stated, the parties hereto agree as follows:

, ARTICLE I Definitions 1.01 Additional Payments After Closing. The additional payments due after Closing required to be paid pursuant to Article III hereof. For purposes of Section 15.03, the term Additional Payments After Closing shall not include interest paid or owed on account of the amount in default.

l 1.02 AFUDC. Allowance for Funds Used During Construction shall be that amount of AFUDC recorded on Vepco's books of account or Interest During Construction on Old Dominion's Books of Account as computed in accordance with the method prescribed by the appropriate regulatory authority, and, if Vepco or Old Dominion finances a portion of the facilities i

i l

through a trust at any time during the construction period, the actual cost of financing such undivided interest through the trust net of any Federal income tax benefits realized by Vepco or Old Dominion.

1.03 Agreement. This Purchase, Construction and Ownership Agreement dated as of December 28, 1982, but amended

,and restated October 17, 1983, between Vepco and Old Dominion.

1.04 Authorized Old Dominion Representativas. The Authorized Old Dominion Representatives appointed by Old Dominion pursuant to Section 19.02 hereof.

1.05 Authorized Vepco Representatives. The Authorized Vepco Representatives appointed by Vepco pursuant to Section 19.03 hereof.

1.06 2asic Agreements. This Agreement, the Interconnection and Operating Agreement and the Nuclear Fuel Agreement.

1.07 Capability. Where used in this Agreer.ent, Capability of any unit shall be the net summer or winter (as applicable) rating of such unit, measured in megawatts, as determined by Vepco. These Capabilities shall be established ar< modified in accordance with Prudent Utility Practices following the same methodology Vepco uses in establishing the

! Capabilities of all of its units.

i i .s_

l l

4 1.08 Closing and Closing Date. The Closing and Closing Date provided for in Section 5.01 hereof.

1.09 Common Facilities. All those facilities, including but not limited to both real and personal property, exclusive of North Anna Unit 1, North Anna Unit 2, Support Facilities, Nuclear Fuel, Operating Inventory and Major Spare Parts, which are purchased, leased or otherwise obtained only in connection with the construction, operation and maintenance i of more than one nuclear unit located at North Anna Nuclear Power Station. Common Facilities are more specifically described as of the date hereof in Exhibit A.

1.1'O Facilities. North Anna Unit 1, North Anna Unit 2, the Common Facilities, the Support Facilities, the Operating i

Inventory, and the Major Spare Parts, but excluding Nuclear Fuel, which is the subject of the Nuclear Fuel 1cireement.

1.11 FERC. The Federal Energy Regulatory Commission including any successor governmental agency.

1.12 Force Majeure. As defined in Section 14.01 hereof.

1.13 Indenture of Mortgage. The Indenture of Mortgage dated November 1, 1935, from Vepco to the Chase National Bank of the City of New York (now The Chase Manhattan Bank (National Association)), as trustee, as supplemented from time to time.

l

. . _ . . .,._ . _ . . _ . - - - . _ . , . , _ . _ . _ _ , _ . . _ _ , _ , , .__ . . _ _ _ , . _ _ . . ._ _ _ , . _ - . , _ ~

1.14 Initial Purchase Price. The Initial Purchase Price provided for in Section 3.01 hereof.

1.15 Interconnection and Operating Agreement. Tha Interconnection and Operating Agreement between Vepco and Old Dominion of even date herewith.

1.16 Interest Rates.

(a) The Soecial Interest Rate. A rate per annum equal to the prime rate of The Chase Manhattan Bank, N.A., New York, New York, or its successor, in effect from time to time plus three percentage points (3%).

(b) The Regular Interest Rate. In the case of interest payments owing to Vepco or Old Dominion pursuant to this Agreement, an interest rate per annum equal to the actual weighted cost of short term financing to the Party to whom the payment is owing for the period in question or, if the Party to whom the payment is owing has no short term financing outstanding at the time, the prime rate of The Chase Manhattan Bank, N.A. as in effect from time to time. Short-term financing shall be as defined by the Uniform System of Accounts.

1.17 Lien. Any encumbrance, lien, charge or security interest upon or in any of the Facilities, other than Permitted Encumbrances.

1.18 Major Spare Parts. Those major items designated by the Parties that the Parties keep in inventory for possible use in replacing similar items in units located not only at the North Anna Nuclear Power Station but also at other power stations. The parts that shall be designated as Major Spare Parts at the Closing Date shall be designated by the Parties in Exhibit C. Thereafter, Major Spare Parts shall be designated by that Operating Committee established under Article II of the Interconnection and Operating Agreement. The Major Spare Parts are further described and the methods of calculating the percentage ownership and cost responsibilities of the Parties in the Major Spare Parts are also included in Exhibit C.

1.19 New Investment. The net book cost to Vepco of all additions, improvements, betterments and replacements related to the Facilities incurred after the Closing Date, accounted for by Vepco as utility plant under the Uniform

-System of Accounts. New Investment shall not include AFUDC in

the case where Old Dominion is paying its proportionate share of New Investment in accordance with Section 3.02 of the Agreement, but shall include AFUDC in the case where Vepco has previously incurred a cost and recorded AFUDC on Vepco's books with respect to such cost.

s b

, -a . ,. - -

1.20 North Anna Nuclear Power Station. The nuclear generating plant located in Louisa, Orange and Spotsylvania Counties, Virginia.

1.21 North Anna Unit 1. The nuclear generating unit located in Louisa County, Virginia, designated as North Anna Unit 1 (more specifically described in Exhibit D hereto), and the related completed construction not classified and construction work in progress, representing the cost of all additions, improvements, betterments and replacements thereto, but excluding the Common Facilities, the Support Facilities, the Nuclear Fuel, the Operating Inventory and the Major Spare Parts.

1.22 North Anna Unit 2. The nuclear generating unit located in Louisa County, Virginia, designated as North Anna Unit 2 (more specifically described in Exhibit E hereto) and the related completed construction not classified and construction work in progress, representing the cost of all additions, improvements, betterments and replacement thereto, but excluding the Common Facilities, the Support Facilities, the Nuclear Fuel, the Operating Inventory and the Majer Spare Parts.

1.23 NRC. The Nuclear Regulatory Commission including

any successor governmental agency.

1.24 Nuclear Fuel. For the purpose of this Agreement,

' Nuclear Fuel shall have the meaning as defined 'a the Nuclear Fuel Agreement.

1.25 Nuclear Fuel Agreement. The Nuclear Fuel Agreement between Vepco and Old Dominion of even date herewith.

1.26 Old Dominion. Old Dominion Electric Cooperative and its successors and assigns.

1.27 Old Dominion Members. For purposes of this I

Agreement, those rural electric distribution cooperatives, including their successors and assigns, each of which distributes electricity in areas'within which Vepco supplies electricity either at wholesale or at retail. For purposes of this Agreement, the Old Dominion Members shall mean those I

cooperatives, together with their respective delivery points, listed in Exhibit F, as the same shall be added to, or deleted from, from time to time.

1.28 Old Dominion's Percentage Ownership Interest.

Except as otherwise modified by the operation of Sections 15.03, 16.01 or 16.02 hereof, an undivided ownership interest in the Facilities equal to 11.6 percent in each of North Anna Unit 1, North Anna Unit 2, the Common Facilities, the Operating 9_

4 i

I-

1...u, tory and the Major Spare Parts, and a percentage in the Support Facilities as determined in accordance with Exhibit B.

1.29 Operating Inventory. Equipment, spare parts, tools, goods and supplies (excluding Nuclear Fuel and Major Spare Parts) to be used solely for the operation, maintenance or modification of the Units and recorded on Vepco's books of account in accordance with the Uniform System of Accounts.

1.30 Original Cost. Subject to the definition of New Investment in Section 1.19 the amounts included by Vepco or Old Dominion in its plant accounts determined in accordance with the Uniform System of Accounts at the cost incurred by Vepco or Old Dominion.

1.31 Parties. Vepco and Old Dominion.

1.32 Permitted Encumbrances. Any (i) mechanics' or materialmen's liens in respect of obligations not overdue or which are being contested in good faith by appropriate i

proceedings, (ii) any liens arising by reason of pledges or deposits to secure payment of workmen's compensation or other insurance, (iii) good faith deposits in connection with bids, tenders, contracts or leases, (iv) deposits to secure public or statutory obligations, deposits to obtain the release of any liens referred to in (i) above, deposits to secure or in lieu of surety, stay or appeal bonds and deposits as security for

> )

i r

i

. ._, _ _ _ , , . . . , _ . _ _ _ _ . _ ...__ _ , _ . . . _ . _ _ _ . _ , _ . -____.m

the payment of taxes and assessments or other similar governmental charges, (v) liens in respect of any tax or assessment or other similar governmental charge so long as such tax, assessment or charge is not then due and payable or is being contested in good faith by appropriate proceedings, (vi) judgment liens, so long as such judgment is being contested in

. good faith and execution thereon is stayed within 30 days after the date of entry of such judgment, and (vii) defects in title, encumbrances, easements, servitudes, conditions or restrictions (in each case other than those to secure the payment of money) which can be eliminated by condemnation or do not materially

~

interfere with the proper construction, operation, maintenance or development of the Facilities; provided that any such liens, deposits, defects in title, encumbrances, easements, servitudes, conditions or restrictions do not materially interfere with the proper construction, operation, maintenance or development of the Facilities. With respect to clause (vii) above, the transferee shall have received a certificate of that engineer designated under Section 13.04(1) of the Indenture of f Mortgage stating that the defects in title, encumbrances, easements, servitudes, conditions or restrictions referred to in said clause are of such a character as not, in the opinion l of such engineer, to interfere materially with the proper l l

construction,-operation, maintenance or development of the Facilities.

1.33 Prudent Utility Practices. Any of the practices, methods, and acts engaged in or accepted by a significant portion of the electric utility industry at the time the decision was made, or any of the practices, methods, and acts that, in the exercise of reasonable judgment in light of the facts known at the time the decision was made, would have been expected to accomplish the desired result at a reasonable cost consistent with reasonable reliability, safety, expedition and protection of the environment. Prudent Utility Practices are not intended to be limited to the optimum practices, methods, or acts to the exclusion of all others, but rather to a spectrum of possible practices, methods, or acts engaged in or accepted by a significant portion of the electric utility industry at the time the decision was made.

1.34 REA. The Rural Electrification Administration including any successor governmental agency.

1.35 SEC. The Securities and Exchange Commission including any successor governmental agency.

1.36 Superior Lien. Any Lien that is prior to or superior to any Lien of Vepco, i

l l

l

4 1.37 Support Facilities. All those facilities, 4

wherever situated, including, but not limited to, both real and personal property, exclusive of Common Facilities, Nuclear Fuel, Operating Inventory and Major Spare Parts, which are purchased, leased or otherwise obtained for the construction, operation and maintenance of one or more nuclear unit (s) located at the North Anna Nuclear. Power Station and one or more i ,

nuclear unit (s) located at Vepco's Surry Nuclear Power Station or at such other location as Vepco may have an interest in any nuclear facility. Support Facilities, and investment and cost responsibilities of the Parties therefor, are more specifically descrdbed in Exhibit B hereto.

1.38 Uniform System of Accounts. FERC's " Uniform System of Accounts Prescribed for Public Utilities and Licensees (Class A and Class B)", as in effect as of the date of this Agreement, or as such Uniform System of Accounts may be applicable to Class A utilities from time to time. References I

in this Agreement, or the exhibits hereto, to any specific account number shall mean the account number in effect as of

, the effective date of this Agreement or as the account number 4

may be modified or amended.

w i

13-i

- - .,_.. - . . . , , , . _ . , . , . - , . - , . . . . ,m___ .,__ . ,,.- _m.,___._-.------.m.-,_,__ . . . . , - - - . , . _ . . . . . . . . ,

I 1.39 Unit (s). North Anna Unit 1 or North Anna Unit 2.

1.40- Vepco. Virginia Electric and Power Company, a Virginia public service corporation, and its successors and assigns.

1.41 The Virginia Commission. The State Corporation Commission of Virginia including any successor governmental agency.

1.42 The West Virginia Commission. The Public Service Commission of West Virginia including any successor governmental agency.

1.43 Wholesale Power Contracts. The several wholesale power contracts between Old Dominion and the Old Dominion Members for the purchase of electric energy and capacity by the i

Old Dominion Members from Old Dominion as in effect from time to time.

I

\

l .

4 ARTICLE II Purchase of Old Dominion's Percentage Ownership Interest 2.01 Purchase of Old Dominion's Percentage Ownership c Interest in the Facilities at Closing. At Closing, subject to

, the terms 1and conditions herein set forth, Vepco agrees to sell and convey, and Old Dominion agrees to purchase and pay for Old Dominion's Percentage Ownership Interest in the Facilities at the Closing Date.

l 2.02 Conveyances. At Closing, Vepco shall consummate i

the transfer.of Old Dominion's Percentage Ownership Interest by delivery of:

(a) A Special Warranty Deed substantially in the form of Exhibit G hereto (making-Old Dominion and Vepco tenants in common);

(b) An Assignment Agreement substantially in the form of-Exhibit H hereto transferring such undivided ownership interest in Vepco's rights and obligations under those certain l contracts, licenses and permits listed in Appendix B to Exhibit-l H hereto, for the purchase, repair,' construction and ownership i

of the Facilities; (c) A Bill of Sale,.substantially in the form of Exhibit I hereto, conveying such undivided ownership interest in all property listed thereon; 4

- 15-4 1

.w ., . .-%.,w,- , - - . ,r_.,,..,- - _,--wf-.,.. n~y . ,-._.--~,.4 ,,-yy - w _w w-.~,-.-y-..y -., ..-,

(d) Releases of such undivided ownership

, interests in the Facilities from the lien (s) of the Indenture of Mortgage.

2.03 Entitlement to Capability.

(a) After Closing, except as otherwise provided in this Agreement, Old Dominion and Vepco shall be entitled to the Capability of North Anna Units 1 and 2'as follows:

Vepco: 88.4 percent Old Dominion: 11.e cercent It is recognized, however, that, in accordance with Article VII of the Interconnection and Operating Agreement, for a period of years following Closing, Old Dominion shall sell and Vepco l

shall purchase a portion (s) of Old Dominion's rights to the

, Capability of these units.

(b) With respect to North Anna Units 1 and 2 Old Dominion shall be entitled to Old Dominion's Percentage Ownership Interest of the available capacity in each such Unit.

Available capacity is defined as that capacity that is l available for operation. Reductions in Unit capacity caused by i

operating limitations or regulatory requirements, during any hour in a billing period, shall result in proportional reductions in Old Dominion's share of the available capacity.

l i

,. - - , . _ . . - ,, -- - - - - - - , - - - -~ - -- - --

2.04 Proviso. Notwithstanding the foregoing sections of this-Article II, the Parties' entitlement to available capacity and associated energy may be modified from time to time in accordance with the operation of Sections 15.03, 16.01 or 16.02 hereof and of procedures set forth in Article VII of the Interconnection and Operating Agreement.

2.05 Second Mortgage Lien. In consideration of Vepco's obligations to Old Dominion under the Basic Agreements, Old Dominion agrees to grant to Vepco, at the Closing, a Second Mortgage Lien on the Facilities to secure the payment by Old Dominion of those amounts due to Vepco pursuant to the second sentence of Section 3.04 hereof. Such Second Mortgage Lien shall be evidenced by a Second Mortgage and Deed of Trust substantially in the form of Exhibit J, hereto. As set forth in Exhibit J, the Parties agreegthat upon anygdefault in the payment of money under old Dominion's first mortgage, Old Dominion snall give Vepco timely written notice of the occurrence of any such event of default under Old Dominion's first mortgage and Vepco shall have the right to cure such default. Upon any default in the payment of money under Old Dominion's second mortgage, Old Dominion shall give its first mortgagee timely written notice of any such event of default under Old Dominion's second mortgage and the first mortgagee shall have the right to cure such default.

, . . - . . - .- ~ . . . - - - - - . -

I ARTICLE III Payments for Old Dominion's Percentage Ownership Interest

, 3.01 Payment.

(a) The purchase price of the Facilities shall be (x) their original cost less the accumulated provisions for depreciation stated on Vepco's books of account plus (y) a negotiated payment in excess of original cost depreciated in the amount of $2,506,000 for each of North Anna Units 1 and 2 for a total of $5,012,000, in recognition of the fact that (1)

Old Dominion'is purchasing operating units and (ii) Old Dominion could not build the Units today for a comparable cost, as well as (z) a payment for the tax liability incurred by Vepco as a result of this transaction, grossedeup for the appropriate Federal income tax rate, to make Vepco whole after payment by Vepco of Federal income taxes :alculated at the applicable statutory tax rate, computed without taking into f account the tax effect of any other transaction or any applicablo investment tax credits. At the Closing, Old Dominion shall pay to Vepco as the Initial Purchase Price for i Old Dominion's Percentage Ownership Interest the amount l

resulting from the application of the calculations, and subject i

to adjustment, both as prescribed in Exhibit K hereto. The balance of the purchase price is paid pursuant to Section 3.04

, hereof.

l i

t L

D (b) Other payments or credits at Closing shall include deferred fuel costs applicable to the Facilities, resulting from the application of the calculations, and subject to_ adjustment, both as prescribed in Exhibit K hereto.

3.02 Additional Pavments After Closing.

(a) After Closing, Vepco shall provide to Old Dominion a monthly estimate of New Investment for the Facilities for the remainder of the calendar year in which Closing takes place. Thereafter, on or before the first day of January of each year during the term of this Agreement, Vepco shall provide to Old Dominion a monthly estimate of New Investment for the twelve-month period commencing on that January 1. Vepco will also provide to Old Dominion, upon request, such estimates for future years as Vepco shall have prepared for its own use. The estimate shall not be binding on Vepco but snall be provided solely to assist Old Dominion in planning for its capital requirements.

(b) Not later than the twentieth day of each month, Vepco will submit an invoice to Old Dominion for its share (as provided in Section 3.02(c) below) of the next month's estimated expenditures for New Investment. Such invoice will be furnished in substantially the form of Exhibit L hereto and will be signed by a corporate officer of Vepco.

l i

e

Old Dominion shall pay such invoice by the fifteenth day of the month covered by such estimated expenditures. In the event that Old Dominion shall fail to pay any monthly invoice payable under this Section 3.02(b) by such fifteenth day, Old Dominion agrees *.o pay Vepco the Special Interest Rate on the unpaid invoice amount. When the actual expenditures for New Investment for that month have been determined by Vepco and recorded on its books of account, an adjustmunt shall be made by Vepco to reflect a credit or additional charge to Old Dominion and such credit or additional charge shall appear, with interest at the Regular Interest Rate payable to the approprit;e Party, on the monthly invoice next delivered after determination of the actual expenditures. ,

(c) The invoice delivered pursuant to Section 3.02(b) shall provide, in addition to the estimate of expenditures for New Investment during the next month, the then current estimates of the New Investment for each of the l

l remaining months in that calendar year (unless there is no change), which estimates may be different from the monthly estimate originally furnished on or before January 1 pursuant to Section 3.02(a). The delivery of such estimates (which estimate shall not be binding upon Vepco but shall be provided solely to assist Old Dominion in planning for its capital 4

, e - , , -

-- m-. ,

requirements) of New Investment for the remaining months of the calendar year shall constitute notice by Vepco to Old Dominion of any change in Vepco's estimate. Vepco agrees, however, to use its best efforts to give Old Dominion as much advance notice of New Investment estimate changes as is practicable, particularly in the case of changes which may substantially increase the amount Old Dominion must pay for its share of New

. Investment in a future month.

(d) Old Dominion's share of New Investment to be paid to Vepco each month shall be a percentage of New Invest-ment for such month equal to:

(1) 11.6% for New Investment in North Anna Units

. 1 and 2, the Common Facilities and the Operating Inventory; and (ii) such percentages of all New Investment in the Support Facilities and in the Major Spare Parts as are j determined in accordance with Exhibits B and C, j respectively; except when such specified percentages shall be modified in accordance with the provisions of Sections 15.03, 16.01 or 16.02 hereof.

(e) Any monies paid to Vepco by Old Dominion shall be applied, first, to the payment of taxes then due pursuant to Section 3.04 hereof, second, to any interest due to Vepco under the Basic Agreements, third, to Old Dominion's share of cperating and maintenance expenses of the Facilities, 71- .

l v w - -, r--- - - --w- ,w w=me 1 -rw-p y w- w w F P -y ey+- y g-wry w- w- - - - - * -y w-

• gr-

fourth, to New Investment,,fifth, to payments for supplemental power under the Interconnection and Operating Agreement, and _

sixth, to payments for any other amounts due.

3.03 Payments for Retirements and Decommissioning Costs; Option to Purchase or Lease the Facilities.

(a) Vepco shall have the authority to determine when units of property shall no longer be used or useful in the operations of the Facilities in which they were installed and l

when they shall be retired from service, with or without replacement. Cost of retirements and salvage credits from sales or other uses, if any, shall be shared by the Parties in proportion to their respective ownership interests.

(b) Vepco shall retain such powers hereunder as shall be necessary for the disposition of all tangible and intangible property (excluding the land constituting a part of l

that Facility) and shall dispose of such property as promptly as practicable. Upon such disposition, Vepco shall distribute l the proceeds thereof, if any, to Old Dominion in accordance l

with its Percentage Ownership Interest hereunder.

(c) At the times when any Unit or any portion of the real estate cor.stituting the Facilities is to be retired, Vepco will furnish written notice of such retirement to Old i

Dominion. Vepco shall have the option, which may be exercised i

l l

by written notice to Old Dominion given within one year after retirement of that portion of the Facilities, (i) to lease from Old Dominien, Old Dominion's Percentage Ownership Interest in the land associated with that portion.of Facilities which is the subject of the notice, for a period of up to 99 years at a

, rental sufficient to provide Old Dominion with an annual rate of return upon its Original Cost for the land equal to the rate of return earned at the time for similar land in the vicinity with appropriate adjustment for changes in such return during the term of the lease or (ii) to purchase such interest from Old Dominion at fair market value.

(d) Upon the issuance of a lawful and enforceable order terminating the operation of any portion of the Facilities,.from the Government of the United States or from the State or any of the departments, agencies, officials or courts thereof'having jurisdiction, or upon a determination by Vepco after consultation with Old Dominion, that the whole or any portion of the Facilities has reached the end of its .

usefulness for the generation of electric energy and should be retired, the Parties, subject to the next following sentence, shall bear all costs incurred for decommissioning in proportion to their respective ownership interests, as they may change from time to time and as determined separately for each m m . . . , - , ,3*,,----,r .

- e - + =-w -, e ~ -

-calendar year during such ownership periods, for whatever period of time is necessary, whether pursuant to regulatory requirements or otherwise, to complete the decommissioning:

process so that no further expenditure of funds is required.

For purposes of this Section 3.03(d), Cid Dominion's ownership interest, as determined each year as set forth above, shall be multiplied by the following ratio: (a) the total months from Closing to retirement of the Unit (b) divided by the total l months of commercial operation of the Unit. Old Dominion shall at all times maintain reserves sufficient to meet its obligation to ultimately pay its share of such decommissioning cos ts in the same manner as Vepco shall maintain such reserves in accordance with the accounting treatment prescribed by the Virginia Commission. . Decommissioning costs shall include, but not be limited to, any costs which must be provided for in advance of decommissioning, and any additional costs which are incurred during or after decommissioning, including monitoring of the site, whether such costs shall result from regulatory requirements or otherwise. But should Vepco elect (i) to

, purchace or lease that portion of the land owned by Old l

l Dominion pursuant to Section 3.03(c) hereof and (ii) put the i

l land to any use which increases the costs of decommissioning beyond what they would have been if the land were not put to

$~

l 5

4 such use, then Old Dominion shall not be responsible for any portion of such additional costs.

(e) After the decision to decommission has been made, Vepco shall proceed with the decommissioning unless the Parties agree to enter into a separate agreement to decommis-sion the Facilities. Any such agreement shal'1 contain no provision which is inconsistent with any term of this 4

Agreement.

f 3.04 Payment of Tax Liability. The Initial Purchase Prict provided in Section 3.01 includes certain taxes, subject to tdjastment, as shown in Exhibit M. Certain taxes known to be incurred by Vepco as a result of the sale of North Anna Unit 1 (including Common Facilities, Support Facilities and Major j- Spare Parts) and North Anna Unit 2 shall be paid over the useful remaining tax life, determined as of the Closing, of each Unit pursuant to the promissory note and the schedule set forth in E.shibit N and Exhibit O, respectively.

3.05 Cancellation Costs. Cancellation costs associated with North Anna Unit 4 and Surry Units 3 and 4 allocable to Old Dominion's Percentage Ownnrship Interest in i

the Facilities shall be paid in accordance with Exhibit N, based upon the methodology and the periods heretofore determined by FERC. Cancellation costs associated with North i

Anna Unit 3 allocable to Old Dominion's Percentage Ownership

Interest in the Facilities shall be paid in accordance with Exhibit N and based on the ratemaking methodology and period authorized by FERC.

3.06 Pavment for Other Costs. The Parties agree to

, pay those costs relating to their respective ownership interests that are not otherwise provided for herein if such costs are incurred in the planning, design, engineering, con-struction, procurement, making of New Investment, modification, ownership (including payment of any ad valorem taxes),

retirement or decommissioning of the Facilities.

. 3.07 ' Methods of Pavment. All payments required to be made by either Party under this Agreement in excess of $10,000 shall he pair' on or before the payment date in immediately available funds by delivery (before 11:00 a.m., Richmond time) of either a Federal Reserve check or evidence of bank wire to the other Party's account, at a bank designated by such Party.

If any such payment is to be made by bank wire, the Party entitled to the payment shall advise the other Party of the appropriate bank and account number at least one business day

! before the payment is due. All other payments required to be made under this Agreement may be made by check deposited in the United States Mail, first-class postage prepaid, and andressed

to Treasurer, Virginia Electric and Power Company, P. O. Box

. 26666, Richmond, Virginia 23261, if payable to Vepco, and addressed to Executive Vice President, Old Dominion Electric Cooperative, 5601 Chamberlayne Road, Richmond, Virginia 23227, if payable to Old Dominion unless a'different addressee or address shall have been designated by either Party by notice in ,

writing to the other Party. -

I i

l l

ARTICLE IV Representations and Warranties 4.01 Representations and Warranties of Vepco. Vepco represents and warrants as follows:

(a) Vepco is a corporation duly incorporated and validly existing, in good standing, under the laws of Virginia, is duly qualified and authorized to do business and is in good i

standing in each jurisdiction where the character of its properties or the nature of its actions makes such qualification necessary, and has the corporate power to carry on its business as now being conducted and possesses all Federal and State authority and local franchises necessary for the maintenance and operation of its properties and business with such minor exceptions as will not materially interfere with the ownership and operation of the Facilities.

(b) Consummation of the transactions hereby contemplated and performance of the Basic Agreements by Vepco will not result in violation of any laws, ordinances, or i

governmental rules to which it is subject. Vepco either has obtained, or at the Closing Date shall have obtained, all necessary governmental approvals and consents in connection with the consummation by Vepco of the transactions hereby contemplated and the performance by it of the Basic Agreements.

4

-e---- -e y -g ww em*-rv--w= --'w e ,r-= w- s---

• v v' -w -

-w' -

w-- e *-e= wwe-,--'--ww-w

(c) The consummation of the transactions hereby contemplated and the performance by Vepco of the Basic Agreements will not result in the breach of, or constitute a default under, the Articles of Incorporation or By-Laws of Vepco or any indenture (including the Indenture of Mortgage),

mortgage, deed of trust, bank loan or credit agreement, or other agreement or instrument to which Vepco is a party or by which Vepco or its properties may be bound or affected, or result in the creation of any lien, charge, security interest or encumbrance upon any property of Vepco, and Vepco is not in default under any term of any such agreement or instrument, _

,except that Vepco has made no review of, and this Section 4.01(c) shall not apply to, contracts, purchase orders or other agreements that involve less than $50,000.

(d) Vepco is neither a " registered holding company" nor a " subsidiary company ef a registered holding company within the meaning of the Public Utility Holding l

Company Act of 1935; and Vepco is not, and is not directly or l

indirectly controlled by, or acting on behalf of any person which is, an " investment company", within the meaning of the Investment Company Act of 1940, as amended.

i

(e) Vepco has, or at the Closing will have, power to convey, by special warranty deed, title to Old Dominion's Percentage Ownership Interest in the real estate and fixtures constituting the Facilities, free and clear of all liens,

.except for such exceptions as may exist in the titles acquired by Vepco and Permitted Encumbrances.

(f) On the date hereof there exists, as to Vepco,

no Event of Default or event or condition which, with the giving of notice or the lapse of time or both, would constitute an Event of Default.

4.02 Representations and Warranties of Old Dominion.

Old Dominion represents and warrants as follows:

(a) Old Dominion is a generation and transmission cooperative duly incorporated and validly existing, in good f standing, under the laws of Virginia, is duly qualified and t

, authoriced to do business and is in good standing in each t

jurisdiction where the character of its properties or the nature of its actions makes such qualification necessary, and has the corporate power to carry on its business as now being conducted and possesses all Federal and State authority and local franchises necessary for the maintenance and operation of its properties and business with such minor exceptions as will not materially interfere with the ownership and operation of the Facilities.

,e--me--------rezw ~~w-,---m yw-,m,<wnrr-- w, w., - -sv , --v.r y -,,-------m -r-w---,,--

-- - na , -we,- r7

T (b) Consummation of the transactions hereby

, contemplated and performance of the Basic Agreements by Old i

Dominion will not result in violation of any laws, ordinances, or governmental rules to which it is subject. Old Dominion either has obtained, or at the Closing Date shall have obtained, all necessary governmental approvals and consents (including the approval of REA) in connection with the consummation by Old Dominion of the transactions hereby contemplated and the performance by it of the Basic Agreements.

(c) The consummation of the transactions hereby

- contemplated and the performance by Old Dominion of the Basic Agreements will not result in the breach of, or constitute a default under, the Articles of Incorporation or By-Laws of Old Dominion or any indenture, mortgage, deed of trust, bank loan or credit agreement, or other agreement or instrument to which Old Dominion is a party or by which Old Dominion or its properties may be bound or affected, or result in the creation 1 of any lien, charge, security interest or encumbrance upon any property of Cid Dominion (other than any lien, charge, security interest or encumbrance created by Old Dominion as a result of its purchase of Old Dominion's Percentage Ownership Interest at the Closing and other than Permitted Encumbrances), and Old Dominion is not in default under any term of any such agreement or instrument.

_ ,_ _ __ __ . - - _ _ _ , . _ ~ . - - - _ _ . - _

h (d) On the date hereof there exists, as to old Dominion, no Event of Default or event or condition which, with the giving of notice or the lapse of time or both, would constitute an Event of Default.

(e) Each of the Old Dominion Members has entered into and will be bound by the Wholesale Power Contracts on the Closing Date.

4.03 Survival. All representations and warranties made by the Parties in or under the Basic Agreements (and all representations and warranties contained in any certificate or other instrument delivered by any of the Parties pursuant to the Basic Agreements) shall survive the execution and delivery of the Basic Agreements and any action taken or documents delivered pursuant thereto.

ARTICLE V The Closing and Closing Date 5.01 Time and Place. The Closing shall be held commencing at 10:00 a.m., Richmond, Virginia time, on such date on or before November 30, 1983 as the Parties shall agree, at One James River Plaza, Richmond, Virginia or, if required by REA, at such place as shall be designated by REA, provided that, pursuant to Article VI hereof, all conditions precedent to Closing have occurred, unless waived by the Party benefitted thereby. Old Dominion hereby agrees to close promptly upon obtaining the financing that it has covenanted to obtain in accordance with Cection 9.03 hereof. Since time is of the essence, the Closing shall not be later than November 30, 1983.

5.02 Termination of Liability. If the conditions specified in Article VI hereof shall not have been satisfied on or before November 30, 1983 all liability of the Parties under this Agreement shall terminate other than each Party's liabilities for its own expenses.

ARTICLE VI Conditions to Closing 6.01 Conditions Precedent to Vepco's Obligations. All obligations of Vepco to Old Dominion are subject to the fulfillment, on or prior to the Closing, of each of the following conditions:

(a) All instruments relating to the sale and purchase of Old Dominion's Percentage Ownership Interest including a promissory note substantially in the form of Exhibit 0, and all proceedings taken on or prior to the Closing in connection with the performance of the Basic Agreements shall be satisfactory to Vepco and Vepco shall have received copies of all such documents or other evidence as it may reasonably request in order to establish the rightful consummation of such transactions and the taking of all necessary action in connection therewith, in form (as to certification and otherwise) and substance satisfactory to Vepco.

(b) All representations and warranties of Old Dominion in or under the Basic Agreements (and all representations and warranties contained in any certificate or l other instrument delivered by Old Dominion pursuant te the Basic Agreements) shall be true with the same effect as though i

l l

such representations and warranties had been made on and as of such date (except as affected by transactions contemplated by the Basic Agreements) and Old Dominion shall have performed all agreements on its part required by the Basic Agreements to be performed on or prior to such date; and Vepco shall receive a certificate, dated such date, of the President and a principal financial or accounting officer of Old Dominion or, if none, by a nationally recognized independent accounting firm, to such effect.

(c) Vepco shall have obtained all necessary releases and other required documents from the trustee under the Indenture of Mortgage permitting the conveyances pursuant to Article II hereof, accompanied by an opinion of counsel of the trustee substantially to the effect that such trustee has the corporate power and authority to execute and deliver such releases and other documents and that such releases and other documents have been duly executed and delivered and constitute the legal, valid and binding obligations of such trustee enforceable against it in accordance with their terms.

(d) The following governmental and regulatory approvals required to be obtained prior to the Closing by Vepco and Old Dominion shall have been obtained and shall not have-been modified (unless any such modificatien shall have been i

I

, _. I

1 accepted in writing by the Parties) or rescinded, are in full force and effect and all appeal periods shall have expired, such approvals to be evidenced by the delivery to Vepco and Old Dominior. of certification of the governmental approvals referred to in this Article:

The Vir,ginia Commission The West Virginia Commission REA NRC

_FERC Hart-Scott-Rodino and such approvals shall not contain any conditions unaccep-table to Vepco. In addition, Vepco and Old Dominion shall have received any and all other accounting, legal, corporate and regulatory approvals or opinions deemed necessary by either Party. As to all regulatory approvals required for the construction, operation or maintenance of the Facilities or the Nuclear Fuel, Vepco and Old Dominion agree that each shall promptly and with all due diligence, acting jointly or individually as may be appropriate, take all necessary actions and endeavor to obtain all regulatory approvals, licenses, .

orders, and permits as are necessary.

i l

l l  !

(e) Vepco shall have received a written ruling from the Internal Revenue Service or an opinion of its counsel, satisfactory in form and content to Vepco, to the effect that for Federal income tax purposes (a) the arrangement created by the Basic Agreements will be treated as a partnership and not as.an association taxable as a corporation and that Vepco and Old Dominion may elect to exclude such arrangement from the application of Subchapter K of the Internal Revenue Code of 1954, as amended and (b) as a result of the Basic Agreements Vepco will not be denied the right to any investment tax credits, liberalized depreciation or other available tax benefits with respect to its ownership interest.

r (f) The Interconnection and Operating Agreement shall have been accepted for filing by the FERC.

(g) Old Dominion and each of the Old Dominion Members shall have executed and delivered to Vepco a release i

! and covenant not to sue, substantially in the form of Exhibit P hereto, together with certified resolutions of the respective Boards of Directors authorizing such execution and delivery.

(h) Vepco shall nave received a satisfactory certificate or certificates, each signed by appropriate officers of Old Dominion and dated as of the Closing Date, as to all questions of fact involved in the conditions set forth in this section 6.01.

t

i (i) The Wholesale Power Contracts shall be in full force and effect.

(j) Vepco shall have received opinions of Litten, Sipe and Miller and Heron, Burchette, Ruckert & Rothwell, counsel for Old Dominion, dated the Closing Date, substantially in the forms of Exhibits Q and R hereto.

(k) Vepco shall have received a certified copy of resolutions duly adopted by the Board of Directors of Old Dominion ratifying or approving all of the transactions contemplated by the Basic Agreements.

(1) Old Dominion shall have made available in immediately available funds the Initial Purchase Price required to be paid at the Closing, as required by Section 3.01.

(m) All actions required to be taken by REA to permit the consummation of this Agreement shall have been taken and Vepco shall have received evidence, satisfactory to it, that a loan agreement between Old Dominion and the REA or other lender (s) satisfactory to Vepco has been duly executed and is a legal, valid and binding obligation of Old Dominion, the REA or other lender (s) sufficient to finance Old Dominion's Percentage Ownership Interest at the time of Closing, in the Facilities.

6.02 Conditions Precedent to Old Dominion's Obligations. All obligations of Old Dominion to Vepco are subject to fulfillment, on or prior to the Closing, of each of the following conditions:

(a) All instruments relating to the sale and purchase of Old Dominion's Percentage Ownership Interest and all proceedings taken on or prior to the Closing in connection

. . with the performanco of tne Basic Agreements shall be satisfactory to Old Dominion and Old Dominion shall have rs -d copies of all such documents or other evidence as they may reasonably request in order to establish the rightful consummation of such transactions and the taking of all necessary action in connection therewith, in form (as to certification and otherwise) and substance satisfactory to Old Dominion.

(b) All representations and warranties by Vepco in or under the Basic Agreements (and all representations and warranties contained in any certificate or other instrument j delivered by Vepco pursuant to the Basic Agreements) shall be true with the same effect as though such representations and warranties have been made on and as of such date (except as affected by transactions contemplated by the Basic Agreements),

and Vepco shall have performed all agreements on its part l .

required by the Basic Agreements to be performed on or prior to such date; and Old Dominion shall receive a certificate, dated such date, of the Chairman of the Board, President or Vice President :nd a principal financial or accounting officer of Vepco to such effect.

(c) Vepco shall have obtained all necessary releases and other required documents from the trustee under the Indenture of Mortgage permitting the conveyance pursuant to i

Article II hereof, accompanied by an opinion of counsel'for the trustee substantially to the effect that such trustee has the corporate power and authority to execute and deliver such releases and other documents and that such releases and other documents have been duly executed and delivered and constitute the legal, valid and binding obligations of such trustee enforceable against it in accordance with their terms.

(d) The follcwing governmental and regulatory approvals required to be obtained prior to the Closing by Vepco and Old Dominion shall have been obtained and shall not have been modified (unless any such modification shall have been accepted in writing by the Parties) or rescinded, are in full force and effect and all appeal periods shall have expired, such approvals to be evidenced by the delivery to Vepco and Old Dominion of certification of the governmental approvals referred to in this Article:

The Virginia Commission The West Virginia Commission REA NRC FERC Hart-Scott-Rodino and such approvals shall not contain any conditions unaccep-table to Old Dominion, subject to the provisions of Section l

9.03 hereof. In addition, Vepco and Old Dominion shall have received any and all other accounting, legal, corporate and regulatory approvals or opinions deemed necessary by either Party. As to all regulatory approvals required for the construction, operation or maintenance of the Facilities or the Nuclear Fuel, Vepco and Old Dominion agree Ebat each shall promptly and with all due diligence, acting jointly or individually as may be appropriate, take all necessary actions and endeavor to obtain all regulatory approvals, licenses, orders, and permits as are necessary.

(e) Old Dominion shall have received a written opinion of its counsel, satisfactory in form and content to Old Dominion, to the effect that for Federal income tax purposes (a) the arrangement created by the Basic Agreements will be treated as a partnership and not as an association taxable as a

corporation and that Old Dominion and Vepco may elect to exclude such arrangement from the application of Subchapter K of the Internal Revenue Code of 1954, as amended and (b) as a result of the Basic Agreements (provided Old Dominion otherwise qualifies for such tax benefits) Old Dominion will not be denied the right to any investment tax credits, liberalized depreciation or other available tax benefits with respect to its ownership interest.

(f) The Interconnection and Operating Agreement shall have been accepted for filing by the FERC.

(g) Vepco shall have executed and delivered to Cid Dominion and each of the Old Dominion Members a release and covenant not to sue, substantially in the form of Exhibit S hereto.

(h) Old Dominion shall have received a satisfactory certificate or certificates, each signed by appropriate officers of Vepco and dated the Closing Date, as to all questions of fact involved in the conditions set forth in this Section 6.02.

(i)- The Wholesale Power Contracts shall be in j full force and effect.

l f

1 I

j l 1

r (j) Old Dominion shall have received an opinion of Hunton & Williams, Richmond, Virginia, counsel for Vepco, dated the Closing Date, substantially in the form of Exhibit T hereto.

(k) Old Dominion shall have received a certified copy of resolutions duly adopted by the Board of Directors of Vepco ratifying or approving all of the transactions contam-plated by the Basic Agreements.

(1) Old Dominion shall have received such insurance binders and other evidence of insurance as it may have reasonably requested at least 15 days prior to the Closing.

t f

. - - + . - - - - , ..,,-----..,--,,e.-. .n-- - - - . . , - - - --- , . . - . . - - - . . - , - - - -

-1 ARTICLE VII Nuclear ruel 7.01 Sale and Purchase of Nuclear Fuel. The sale by Vepco and the purchase by Old Dominion of Nuclear Fuel is provided for in the Nuclear Fuel Agreement and not by this Agreement, except to the extent that (a) provisions of this

- Agreement specifically refer to Nuclear Fuel or the Nuclear Fuel Agreement or (b) provisions of this Agreement are incorporated by referance in the Nuclear Fuel Agreement.

i i

ARTICLE VIII Management of the Facilities; Liability and Allocation of Risk; and Contracts for the Facilities 8.01 Vepco as Agent of Old Dominion.

(a) Old Dominion hereby appoints Vepcc (such appointment shall be irrevocable, for the term of this Agreement, and coupled with an interest) its sole agent subject, however, to Old Dominion's right of reasonable inspection through authorized representatives, to act on its behalf for the planning, design, engineering, construction, procurement, making of New Investment, modification, operation, maintenance, retirement and decommissioning of the Facilities and authorizes Vepco in the name of and on behalf of Old Dominion to take all reasonable actions which, in the discretion and judgment of Vepco, are deemed necessary or advisable to effect the planning, design, engineering, construction, procurement, making of New Investment, modification, operatior, maintenance, retirement and decommissioning of the Facilities, including, without limitation, the following:

1 (i) The making of such agreements and modifications of existing agreements and the taking of such other action as Vepco deems necessary or

I appropriate, in its sole discretion, or as may be required under the regulations or directives of such governmental bodies and regulatory agencies having jurisdiction, with respect to the construction, acquisition and completion of the Facilities for commercial service, the procurement, replacement, modification or renewal of all or any part thereof, and if necessary, the retirement, disposal, decommissioning or salvaging of any part thereof, whether before or after completion; (ii) The evacution and filing with such i .

governmental bodies and regulatory agencies having jurisdiction of applications, amendments, reports and other documents and fi]ings for or in connection with licensing and other regulatory matters with respect to Facilities; and (iii) The receipt on Old Dominion's behalf of any notice-or other communication frem any governmental body or regulatory agency having jurisdiction, as to

, any licensing or other regulatory matter with respect l to Facilities.

l 1

l

,,L _ . , - r- wr,, --, -,-r - , - - --

-e+- - -- - - , - - + - < - - '- " " ~ ' ' ' ~ ' ~ ~ ~ ' '

(iv) Subject to Section 9.05(f), the right to bring suit on behalf of Old Dominion or Old Dominion and Vepco jointly for any cause of action arising out of or in connection with rights or obligations under the Basic Agreements.

(b) As relates to all third parties, this agency designation shall be binding on Old Dominion, and such appointment shall be deemed in effect by each third party until termination of this Agreement pursuant to the terms hereof and such third party receives written notification from Vepco of any termination thereof.

(c) Vepco accepts such appointment. In discharging all of its duties and responsibilities hereunder, Vepco will act in good faith and in accordance with Prudent Utility Practices.

! (d) Old Dominion agrees that it will take all necessary action in a prompt manner to execute any agreements j with respect to the Facilities as and ihen requested by Vepco.

l (e) Old Dominion expressly agrees that Vepco does not, by this Agreement, assume any risks or liabilities with respect to Old Dominion's Percentage Ownership Interest and that the amounts paid and payable to Vepco under the Basic Agreements are determined on the basis that Vepco does noc t

l l

__ _ - ._ _: _ - - . _ _ _ , . _ , , , - ~ . _ . _ _ . .

assume any such risks or liabilities, except as otherwise expressly provided by the Basic Agreements.

8.02 Contract Assignment and Tran'sfer Limitations.

Old Dominion recognizes that a number of Vepco's contracts relating to the Facilities contain provisions that require Vepco to obtain from any assignee or transferee, prior to any assignment of any rights under such a contract or any transfer of materials, equipment or work product, or any interest

therein, obtained by Vepco pursuant to such a contract, an agreement by such assignee or transferee that it will be bound by all of the requirements for financial protection, waivers, releases, indemnification, limitation of liability and further transfers that bind Vepco under such contract; and therefore Old Dominion-hereby agrees that it will be bound by the requirements for financial protection, waivers, releases, indemnification, limitation of liability and further transfers that bind Vepco as they now exist or may in the future be with

respect to all contracts relating to the Facilities.

8.03 No Adverse Distinction. Notwithstanding any other provisions of this Agreement,.in discharging its duties and responsibilities pursuant to this Agreement, Vepco shall not, solely because of the Old Dominion's Percentage Ownership Interest in the Facilities, make any adverse distinction

. -,,--m., n -

- . , , - ,..v. , - ,,. ,., , ,

between any of the Facilities and any other generating unit or facilities in which Vepco has an ownership interest.

8.04 Liabilit{es_of the Parties. In no event shall either Party be liable to the other Party for any indirect, special, incidental or consequential damages with respect to any claim arising out of the Basic Agreements whether based on contract, tort (including negligence), patent, trademark or service mark or otherwise. Old Dominion shall indemnify and hold Vepco harmless from and against any claim by or liability of the Old Dominion Members or member-consumers (other than Vepco) of Old Dominion Members for any such indirect, special, incidental or consequential loss or damage arising out of any performance or failure to perform under the Basic Agreements.

Vepco shall indemnify and hold Old Dominion harmless from and against any claim of or liability of Vepco's customers (other than Old Dominion) for any such indirect, special, incidental or consequential loss or damage arising out of any performance or failure to perform under the Basic Agreements.

Neither Party shall be entitled to recover from the other Party, its agents, employees or insurers any damages resulting from error or delay in the design, engineering, procurement, installation, construction, operation, modification or decommissioning of the Eacilities, or for any

6 damage thereto, any curtailment of power or any damages of any kind, including consequential damages, occurring during the course of design, engineering, procurement, installation, construction, operation, maintenance, shut-down, demolition, decommissioning or disposal of the Facilities, or otherwise arising out of the performance of the Bisic Agreements unless such damages (other than consequential damages, which shall not be recoverable in any event) shall have resulted from gross negitgence of a Party, its agents or employees; but all such damages (other than consequential damages, which shall not be recoverable in any event) other than those resulting from gross negligence of a Party, shall be shared pro rata on the basis of the ownership in the Facilities and the nuclear fuel. In no event shall Vepco ever be liable to old Dominion for damages or otherwise for the failure of any machinery or equipment in the Facilities and/or related facilities, or any portion thereof, or for any interruption, curtailment or diminution of the production of power and energy, or of service at or transmission from said Facilities resulting from such failure of equipment, unless such failure isAcaused by gross negligence on the part of Vepco.

l l

l

The liability of Vepco and Old Dominion to third parties, whether arising in contract, tort (including negligenee and strict liability) or otherwise, including but n9t limited :o liability arising out of any contract or the brsach thereof, for loss.of or damage to property and for personal injury, including death, including liabilities for claims, rights, demands and causes of action existing as of the Closing Date (whether known or unknown), arising out of or in -

any matter connected with the procurement, construction, operation, maintenance, modification, or decommissioning of the Facilities shall be shared, satisfied, and discharged in proportion to the Parties respective ownership interest in the affected Facilities; provided, however, that in no event shall either Party be liable to the other for any liability to third parties to the extent that such liability arises out of or is in any manner connected with the gross negligence of the other party. Each Party hereby undertakes to indemnify the other from and against liability to third parties to the extent of its respective obligation as set forth in the preceding sentence, regardless of whether that Party is made a party to i

i any claim, demand, suit or other proceeding giving rise to such l

! liability.

i i

ARTICLE IX General Covenants 9.01 Covenant to Use Best Efforts. Vepco and Old Dominion covenant to use their best efforts (a) to insure that all closing conditions set forth in Article VI hereof are satisfied before or at the Closing and (b) to insure that all obligations required to be performed by them under the Basic Agreements will be performed in a timely manner.

9.02 Covenants to Provide Info rmation. Each of the Parties will, from time to time, provide such information as the other Party may reasonably require in connection with the issuance or sale of any bonds or securities or evidences of indebtedness, whether public or private. Each Party further agrees that it will make available to the other Party, upon request, then-current architectural and construction engineering reports, if any, setting forth the design of the Facilities, the status of any required licenses and permits, estimates of construction costs and construction schedules and reports on the operation of the Facilities.

9.03 Old Dominion's Covenant to Obtain Financing. cid Dominion has applied to REA for guarantees of loans adequate for the permanent financing of Old Dominion's Percentage Ownership Interest in the Facilities. Old Dominion agrees to l

t

pursue such application diligently and to use its best efforts to obtain this or other adequate permanent financing and to close by November 30, 1983. Upon acceptance of the REA loan guarantee comnitment by Old Dominion, Old Dominion covenants and agrees t4 o take all steps necessary to draw down the loan I

funds guaranteed by REA to provide the amounts due from and payable by Old Dominion at the Closing under the terms of the Basic Agreements. Old Dominion further covenants and agrees that at all times it will use its best effort to obtain sufficient funds in a timely manner, on terms satisfactory to Old Dominion in its reasonable and cood faith judgment, to fulfill its obligations under the Basic Agreements. Old Dominion further cavenants and agrees that it chall take no action that would prevent, hinder or delay the issuance of any bonds or other securities or evidence of indebtedness, and that it will make all payments and perform all obligations required

! of it under the indentures or other instruments relating to such bonds or securities or evidences cf indebtedness.j\

9.04 Financial Statements and Other Documents.

(a) Vepco covenants and agrees that it will furnish to Old Dominion promptly after the same are available, ccpies of all such proxy statements, financial statements and reports as Vepco shall send to the holders of its Common Stock

and copies of all regular and periodic reports that Vepco may file with the SEC.

(b) Old Dominion covenants and agrees to furnish Vepco promptly after the same are available, copies of all annual and periodic financial reports that Old Dcminion may file with the' Virginia Commission, REA or FERC or shall send to the Old Dominion Members, including proxy statements or the equivalent thereof. In addition, Old Dominion shall furnish Vepco promptly with copies of all draft agreements and executed agreements relating to the arrangements referred to in Section 9.03.

9.05 Other Covenants.

(a) Each Party covenants and agrees that if any event shall occur or condition shall exist which constitutes, or which after notice, lapse of time, or both, would constitute, an Event of Default hereunder, 12 shall immediately (and thereafter on a prompt, continuing basis) notify the other Party thereof, specifying the nature of the Event of Default and any action taken or proposed to be taken with respect I thereto.

(b) Old Dominion covenants and agrees that at the Closing it will notify Vepco in writing of the names and addresses of each trustee under any instruments of indebtedness

and it further covenants and agrees that at all times while this Agreement remains in effect, it will promptly notify Vepco in writing of the names and addresses of all substitute or additional trustees.

3 (c) Old Dominion covenants that so long as any of the Basic Agreements remain in effect, it will not dissolve.

Old Dominion further covenants that it will not consolidate or merge with or acquire any other entity or dispose of any material portion of its assets unless it has provided Vepco with a certificate to the effect that, (i) as a result of such consolidation, merger, acquisition or disposition, the successor formed by or resulting from such consol'idation or merger.or the transferee to which such sale or other disposition shall have been made shall be a solvent corporation organized under the laws of the United States of America or a state thereof, (ii) such successor or transferee corporation shall expressly assume in writing all of the ohLigations of Old Dominion under the Basic Agreements to the same extent as if such successor or transferee corporation had originally i

executed the Basic Agreements in the place of Old Dominion, (iii) immediately after such consolidation, merger, sale, transfer or other disposition, such successor or transferee shall have a credit worthiness and financial capability to i

+

e 4

d n

perform its obligations under the Basic Agreements substantially equal to the credit worthiness or financial capabf.lity of Old Dominion and (iv) there shall be no Event of Default or event which, with the giving of notice or the lapse of time or both, could become an Event of Default under the Basic Agreements.

(d) Subject to Vepco's rights under Sections 3.03, 8.01 and 13.01(b), Vepco covenants to use its best efforts to maintain in effect, and to renew when necessary, all NRC permits and licenses required for the construction and ownership of the Facilities.

(e) Vepco covenants to permit officers, directors, employees and proper agents of Old Dominion to have accecs to and to inspect the Facilities at reasonable times, or on a recurring basis, provided (i) Old Dominion shall use its best efforts to give Vepco advance notice of any visit to the Facilities and to coordinate with Vepco to minimize or avoid any interference with Vepco's activity at the Facilities, (ii)

Vepco may require that any such visit be escorted by Vepco personnel and (iii) such visits shall be made in accordance with all Vepco, NRC and other governmental agency regulations, procedures and requirements.

(f) Old Dominion covenants that, without the written consent of Vepco, it will not threaten suit or bring suit against third parties or otherwise make any claim under any contract or arrangement relating to the Facilities and Old Dominion recognizes that Vepco has complete and exclusive authority, under the Basic Agreements, with respect to all such matters. If Old Dominion desires for suit to be threatened or trought or otherwise for any claim to be made, or desires that such action contemplated by Vepco shall not be taken, Old Dominion shall, by written notice to Vepco request Vepco so to act or refrain from acting. Upon receipt of such notice the parties shall arrange for consultation on the questions raised ~

within 10 working days thereafter, and Vepco shall not make its determination until after such consultation but such determination by Vepco shall be final. Vepco shall not threaten or bring suit on behalf of Old Dominion without giving Old Dominion 10 working days advance written notice thereof, unless the circumstances dictate that Vepco must take such action within less than such 10 days' notice to Old Dominion.

(g) Old Dominion covenants that it shall notify Vepco in writing as soon as possible after learning that any Lien has been or will be imposed upon Old Dominion's Percentage Ownership Interest in the Facilities or has reason to believe

that any such Lien is under discussion with a possible lender or other entity and shall furnish Vepco promptly with all draft copies s,nd executed copies relating thereto.

4 e

1 i

i l

L

-se-

.--~--....--...,.-,,,,,._n,., .~.,,.---,.-,,.--a..,,,..n , , - , , . . , , , _ . , , . , , _ . , _ - , , , . , . , _ _ _ . . , , _ , , _ _ _ . , , . . , . , , , , . _ _ _

ARTICLE X Waiver of Partition As permitted by Section 56-90.1 of the Code of Virginia, the Parties, on their own behalf and on behalf of their successors and assigns, hereby waive any right, whether pursuant to statute or common law, to partition the Facilities, or any portion thereof, and such waiver shall continue in effect until the earlier of (a) the termination of this Agreement pursuant to Section 17.01 plus the one-year Vepco option provided for in Section 3.03 or (b) December 31, 2081.

The Parties agree not to commence during such period any action of any kind seeking any form of partition with respect thereto.

The Parties agree to incorporate this waiver in all deeds, deeds of trust, and instruments of conveyance relating to the Facilities, whether delivered at the 01osing or thereafter; provided, however, that such waiver shall be null and void during any period when there shall exist an event of default as defined ingthe respective Indentures,of Mortgage of the Parties.

i i

l

ARTICLE XI Assignment 11.01 Old Dominion's Right to Assign. This Agreement and the other Basic igreements shall be binding upon, and shall

'inure to the benefit of Old Dominien and Vepco, and their respective successors and assigns. Old Dominion shall have the right to convey a security interest or interests in Old Dominion's Percentage Ownership Interest to the United States Government or any agency thereof or to the National Rural Utilities Cooperative Finance Corporation or to credit sources of the type traditionally and customarily used by rural electric cooperatives similarly situated, solely to secure loans, or bonds or other evidences of indebtedness issued or to be issued by it.jgNo other succession to or assignment of any rights hereunder or under the other. Basic Agreements or any rights in the Facilities shall take place without the prior writtenconsentofVepco./(

11.02 Vepco's Right to Assign. So long as it shall l

l have obtained all necessary governmental approvals, Vepco shall I

be free to assign, transfer or convey any or all of its interest in the Facilities and in this Agreement and the other Basic Agreements at any time without the consent of Old Dominion but no such assignment, transfer or conveyance shall

\ -

l l

_ . . . . . - _ _ . . - , - _ _ - _ _ ~ _ . .

}

diminish old Dominion's Percentage Ownership Interest or diminish any other rights of old Dominion or the obligations of Vepco hereunder; provided, however, that Old Dominion may contest by t,)prepriate proceedings the granting of any such f

governmental approvals.

i

{

I

ARTICLE XII Insurance 12.01 General. During the term of this Agreement and in accordance with Prudent Utility Practices, Vepco will make reasonable best efforts to obtain and maintain in force, in the name of the Parties (naming Old Dominion as a named insured),

o as their interest may appear, insurance covering the Facilities as described in this Article XII.

12.02 Nuclear Property Insurance. Vepco shall, during the period of this Agreement, obtain and maintain in force all-risk nuclear property insurance, to include builder's risk, available from the American Nuclear Insurers (ANI) and Mutual Atomic Energy Reinsurance Poci (MAERP), Nuclear Mutual Limited (NML) or other equivalent coverage from some other equivalent insurer. The limit and the deductible of such insurance will be the appropriate amounts as determined by Vepco and available from the pools and any deductible will be for the account of the Parties as their interest may appear.

12.03 Nuclear Liability Insurance. Vepco will carry insurance to cover the legal obligation to pay damages because of bodily injury or property damage caused by the nuclear energy hazard, the policy to be provided by ANI and Mutual Atomic Energy Liability Underwriters (MAELU) or equivalent m W

l

)

coverage from some other equivalent insurer. The limits will be in the amounts required by the Atomic Energy Act of 1954, as amended. Vepco will continue to carry such insurance against the foregoing risks with coverage and limits as may be required by the Nuclear Regulatory Commission.

12.04 General Liability Insurance. Vepco will carry insurance to cover the legal obligations to pay damages because of bodily injury or property damage caused by other than the nuclear' energy hazard. The limit and the deductible of such coverage shall be the appropriate amounts as determined by i

Vepco.

12.05 Workmen's Compensation Insurance. Vepco qualifies as a self insurer in the Commonwealth of Virginia but will provide an umbrella policy to cover benefits in excess of its assumed liability for workmen's compensation and employers liability. All contractors or subcontractors of either Party shall provide evidence of workmen's compensation and employers liability in accordance with the workmen's compensation laws of I

the Commonwealth of Virginia and the coverage under the Jones Act, if required, before any performance of work or service is 1

begun.

l t

l l-

12.06 Additional Insurance. In the event Vepco at any time or from time to time shall have elected to participate in supplemental insurance programs to cover costs from nuclear risk including decontamination or property damage and other costs arising therefrom or replacement fuel costs due to a prolonged outage (i*:luding but not limited to the insurance programs then offered by Nuclear Electric Insurance Limited (or any similar successor organization) in which Vepco is a participant), the costs of such protection shall be in proportion to the ratio of the ratable exposure represented by Old Dominion's Percentage Ownership Interest to the total ratable exposure of the Facilities. In lieu of participating in any insurance coverage for liability or property damage which Vepco may provide for the Facilities, Old Dominion may secure separate coverage from other sources so long as such separate coverage (a) provides at least as much protection as would have been provided if Old Dominion had participated in Vepco's insurance coverage and (b) such separate coverage shall be of equal quality and reliability and shall have been recognized by Vepco, in writing, to be satisfactory to it.

12.07 Allocation and Payment of Premiums. The

aggregate cost of all insurance, including supplemental coverage as set forth in Section 12.06 applicable to the

l I

i.

I a

Facilities and procured pursuant hereto, shall be considered a cost of construction or an operating expense as determined by

' Vepco, consistent with the Uniform Systen of Accounts. The allocation of premiums and any other additional insurance shall be in proportion to the ratio of the ratable exposure represented by Old Dominion's Percentage Ownership Interest to the total ratable exposure of the Facilities. In'the event that any of the foregoing insurance policies is cancelled by either Party, that Party shall give notice of such cancellation to the other Party 30 days prior to the effective date of such cancellation.

t l  !

ARTICLE XIII Destruction; Condemnation 13.01 Destruction.

(a) If the Facilities or any portion thereof should be damaged or destroyed to the extent that the cost of repairs or reconstruction is estimated by Vepco to be equal to or less than the aggregate amount of insurance coverage (including any deductible) carried pursuant to Article XII hereof, then, subject to Vepco's rights under Sections 3.03 and 8.01, Vepco shall, unless otherwise mutually agreed, cause such repairs or reconstruction to be made so that the Facilities or portions thereof shall be restored to substantially the same general condition, character or use as existed prior to such damage or destruction, and Vepco and Old Dominion shall share the cost not reimbursed by insurance in proportion to their respective ownership interests.

(b) If the Facilities or any portion thereof should be damaged or destroyed to the extent that the cost of repairs or reconstruction is estimated by Vepco to be more than the aggregate amount of insurance coverage (including any deductible), Vepco may cause such repairs or reconstruction to be accomplished, although Vepco shall have no obligation to make such repairs or reconstruction if it chooses not to do so.

The Parties shall share such costs, if incurred, proportionately to their ownership interests.

(c) Should Vepco elect not to repair or reconstruct such Facilities and should Old Dominion (either alone or together with others) desire to make the necessary repairs or restoration, Old Dominion (either alone or together with others) may acquire Vepco's share of such Unit from Vepco upon mutually agreed upon terms and a mutually agreed upon price based on circumstances at the time of such destruction, provided Old Dominion shall have obtained all necessary governmental approvals for such acquisition. Vepco shall thereafter have n'o obligation to operate such Unit (unless Old Dominion alone will thereafter own more than 50% of such Unit and agrees to pay te Vepco a mutually agreeable operating fee).

13.02 Condemnation. During the term of this Agreement, if there shall occur a loss of title to, or ownership of, or use and possession of, the Facilities or any portion thereof, as the result of, or in lieu of, or in anticipation of, the exercise of the right of condemnation or eminent domain pursuant to any law, general or special, the affected Party will promptly give notice thereof to the other Party, generally describing the nature and extent of such proceedings or negotiations. Vepco and Old Dominion shall have

-- ~ , - -_ . _ - - .. _ _ _ _ _ -

the right to participate fully in any such proceedings or negotiations and each Party shall bear its proportionate share of all reasonable costs, fees and expenses incurred in connection with any cor.demnation proceedings or negotiations.

If no Event of Default shall have occurred and be then continuing, all awards and payments received by Vepco or Old Dominion on account of any condemnation-(less the actual cost, fees and expenses incurred in collection thereof) shall be paid to the Parties in proportion to their respective ownership

-interests. For purposes of this Agreement, all amounts paid pursuant to any agreement with any condemning authority which

.has been made in connection with any condemnation proceeding or negotiation shall be deemed to constitute an award on account of such condemnation.

i i

- - , - - , - - - , .- - ,-,,,-y , , ~ , . - , , -, . , , - , - . - - , . . , , . . - - - , - , , , . , , , - - , . - , , . - , - - - . , --, ----m.

ARTICLE XIV Force Maieure 14.01 Force Majeure. In addition to all other limitations on liability contained in this Agreement, Vepco and Old Dominion shc11 not be liable or responsible for any delay in the performance of, or the ability to perform, any duties or obligations required by the Basic Agreements when such delay in performance or inability to perform results from a Force Majeure occurrence, except that the obligation of either Party to pay money to the other Party in a timely manner is absolute and shall not be subject to the Force Majeure provisions.

Force Majeure as used herein shall mean, without limitation, the following: Acts of God, strikes, lockouts or other industrial disturbances; acts of public enemies; orders, or absence of necessary orders and permits of any kind which have been properly applied for, from the Government of the United States or from any state or territory, or any of their departments, agencies or officials, or from any civil or military authority; extraordinary delay in transportation; inability to transport, store, reprocess or dispose of spent '

nuclear fuel; unforeseen soil conditions; equipment, material, supplies, labor or machinery shortages; epidemics; landslides; lightning; earthquakes; fire; hurricanes; tornadoes; storms; D

. - - _ . , . . , , - - - , , - - , . - . , , , ~ . . , - -

ficods; washouts; drought; war; civil disturbances; explosions; breakage or' accident to equipment, machinery, transmission lines, pipes or canals; partial or entire failure of utilities; breach of contract by any supplier, contractor, subcontractor, laborer or materialman; sabotage; injunction; blight; famine; blockade; quarantine; or any other similar cause or event not reasonably within the control of either Party. 0 14.02 Femedy. Any Party suffering an occurrence of Force Majeure shall remedy with all reasonable dispatch the cause or causes preventing such Party from carrying out its agreement; provided, that the settlement of strikes, lockouts and other industrial disturbances shall be entirely within the discretion of such Party, and it shall not be required to make settlement of strikes, lockouts or other industrial disturbances by acceding to the demands of the opposing party or parties when such course is unfavorable in the judgment of such Party.

l i

l ARTICLE XV Default 15.01 Events of Default. Each of the following shall be " Events of Default" under this Agreement:

(a) The failure by either Party to make any payment then due to the other Party as required by this Agreement within 30 days of the date when such payment became due; (b) Willful failure by either Party to perform any other obligation to the other Party, other than obligations for the payment of money, provided that the defaulting Party shall have been given not less than 60 days' notice of such willful failure by the non-defaulting Party and such defaulting Party shall have iailed to correct such default or shall have failed to use its reasonable best efforts to correct such default; (c)(1) The insolvency or bankruptcy of either Party or its inability or admission in writing of its inability to pay its debts as they mature, or the making of a general assignment for the benefit of, or entry into any composition or arrangement with, its creditors, other than Old Dominion's or Vepco's mortgagee, as the case may be; er (ii) The application for, or consent (by admissien of material allegations of a petition or otherwise) to, the appointment of a receiver, trustee or liquidator for either Party or for all or substantially all of its assets, or its authorization of such application or consent, or the commencement of.any proceeding seeking such appointment against it without such authorization, consent or application, which proceedings remain undismissed or unstayed for a period of sixty (60) days; or (iii) The authorization or filing by either Party of a voluntary petition in bankruptcy or application for, or 2

consent (by omission of material allegations of a petition or otherwise) to the application of any bankruptcy, reorganization, readjustment of debt, insolvency, dissolution, liquidation or other similar law of any jurisdiction, or the -

institution of such proceedings against either Party without its authorization, applicatien or consent, which proceedings remain undismissed or unstayed for sixty (60) days, or which result in adjudication of bankruptcy or insolvency within such time.

(d) The willful failure by either Party to pay any amount when due under any obligation to a third party (other than an obligation for borrowed money) incurred in 1-t

, -. e.. --. - - , .+ . . - - . ..- . . - . . , . - _ _ . , , - . . . . - ..

. . _ _ . . . . . -,.-,.,-.._.-.,.m._.

connection with such Party's performanct under this Agreement, and such failure shall continue for 30 days thereafter (or if such payment is being contested in good faith, for 30 days after the resolution of such contest).

(e) The failure by either Party to pay any amount when due under any obligation to a third party for borrowed money incurred in connection with the financing of such Party's ,

performance under this Agreement, and such failure shall g

, continue beyond any grace period provided by such third parties in writing in documents related to such borrowed money.

(f) If any representation or warranty made by either Party in the Basic Agreements or any other document or instrument between Old Dominion and Vepco securing the Basic Agreements shall not be true and correct in all material respects as of the date when made.

15.02 Penalty for Late Payments. Failure of either Party to make any payment on the date required under this Agreement shall obligate such non-paying Party then to pay the other Party (i) the unpaid amount, (ii) interest on the unpaid amount at the Special Interest Rate from the date such payment l was due until the amount is paid and (iii) the expenses incurred by the other Party in collecting the unpaid amount including but not limited to the expenses of couasel.

15.03 Failure to Make Payments. If Old Dominion shall fail to make any payments due to Vepco after Closing under this Agreement or operating or maintenance expenses under the Interconnection and Operating Agreement (but not to include a failure to make payments for Supplemental Demand and Energy and Reserve Capacity and Energy) and if such failure shall have s

continued for a period of 45 days (including any applicable grace period) without all sums then due (plus interest and penalties and any other Additional Payments After Closing due within such 45 day period) having been paid to Vepco, there shall then exist a Section 15.03 Event of Default. If at the time of or during the continuation of any Section 15.03 Event of Default, Old Dominion's Percentage Ownership Interest in the Facilities is or becomes less than 8%, then thereafter Vepco, either by itself or in conjunction with others, shall have the following rights which may not be defeated by any offer or tender made in an attempt thereafter to cure the default, but Vepco agrees that it shall not exercise its rights under this Section if and so long as Vepco has been provided, within 45 days after the commencement of the Section 15.03 Event of Default, with satisfactory assurances that REA is pursuing all reasonable steps to provide for the payment of all amounts owing to Vepco during the period of default, including

)

1 interest, not later than 180 days after thegcommencement of the Section 15.03 Event of Default.

(a) Subject to the provisions of Section 16.04 hereof, Vepco shall have the right (but shall not be required) to purchase the entire Old Dominion Percentage Ownership Interest in the Facilities. Subject to Section 18.02 of the Interconnection and Operating Agreement, the purchase price for such interest shall be an amount equal to the aggregate of the Initial Purchase Price and all Additional Payments After Closing made or owed by Old Dominion with respect to the Facilities including appropriate allowances for AEUDC (which AEUDC shall have been determined using rates no higher than the rates used by Vepco for the same period) less the sum of (i) an amount equal to the revenues required (based on the then allowed rate of return for Virginia jurisdictional customers) to support the amount in default (such amount to be stated without taking any depreciation into account) for the entire period of the default, less an adjustment for any interest theretofore paid or owed (but not exceeding such revenue requirement) on account of the amount in default, (ii) taxes paid by Old Dominion and included in the Initial Purchase Price l

or otherwise paid or owed to Vepco pursuant to Section 3.04 with respect to the Facilities and additional taxes incurred as

a result of the repurchase, (iii) depreciation,and amortization accrued on the books of account of Old Dominion, comprised of depreciation reflected in the determination of the Initial Purchase Price (but depreciation reflected in the determination of the Initial Purchase Price shall not be deleted a second time in the application of this Subsection (iii)) and depreciation subsequent thereto determined in accordance with the same methodology used by Vepco, excluding amortization applicable to taxes reflected in (ii) above, (iv) any amount, including taxes not included in (ii) above, owed by Old Dominion under the Basic Agreements, excluding amounts owed by Old Dominion for supplemental power costs, to Vepco, (v) any costs or expenses incurred by Vepco, excluding the cost of any debt incurred to finance such acquisition, in connection with such purchase and (vi) any indebtedness secured byppiens with respect to the interest in the Facilities being acquired and any other obligation assumed or paid by Vepco in order to obtain good title and (vii) any retirements applicable to Old l Dominion's Percentage Ownership Interest in the Facilities. If the result is a negative number, such amount shall be owed to Vepco from Old Dominion pursuant to Section 16.04(a).

I I

l l

t l l l

(b) Upon exercise by Vepco of its right to purchase Old Dominion's Percentage Ownership Interest in the Facilities pursuant to Section 15.03(a), (i) Vepco shall give notice of such election in writing to the trustee or trustees (as named by Old Dominion pursuant to Section 9.05(b) hereof) of Old Dominion's bonds or of other evidences of indebtedness, and (ii) Vepco (and where applicable, any other purchasers)fg shall be, entitled to all of Old Dominion's rights in the Facilities. Any purchase of Old Dominion's Percentage Ownership Interest in the Facilities pursuant to this Section l 15.03 shall be subject to the obtaining of applicable governmental and regulatory approvals and Old Dominion shall take all necessary actions and shall execute, and file where appropriate, all legal documents that shall reasonably be requested by Vepco to complete any transaction contemplated by this Section 15.03.

(c) A closing to consummate the purchase by Vepco i pursuant to this Section 15.03 shall be held at a time and place to be determined by Vepco.

15.04 Acceleration. If an Event of Default under the foregoing Section 15.01(c) shall have occurred, the entire unpaid amounts owing to the non-defaulting Pauty, together with any accrued and unpaid interest thereon, shall become

immediately due and payable without the necessity of any action by the non-defaulting Party. If an Event of Default under Sections 15.01(a), (b), (d) gor (f) shall have occurred and be continuing, the entire unpaid amounts owing to the non-defaulting Party, together with any accrued and unpaid interestthereon,$shallbecomeimmediatelydueandpayableupon written notice by the non-defaulting Party to the defaulting Party. .If an Event of Default under Section 15.01(e) shall have occurred and be continuing and if the third party to whom such amount is owed shall cecelerate such obligation or otherwise exercise legal or equitable remedies against such Party, then the entire unpaid amounts owing to the non-

. defaulting Party, together with any accrued and unpaid interest thereon shall become immediately due and payable without the necessity of any action by the non-defaulting Party.

I 15.05 Remedies Not Exclusive. If an Event of Default under Section 15.01 or a Section 15.03 Event of Default shall have occurred, the rights and remedies provided in this Article XV shall not be exclusive but shall be in addition to any other remedy available under the Basic Agreements and, to the extent permitted by law, be cumulative and in addition to all other rights and remedies existing at law, in equity or otherwise, including the right to enforce performance or to recover

_ . . . _ ,, . . _ . , . _ . , _ . , _ . . - , , . , - , __,._,.m.,

dsmages by appropriate proceedings, judicial, administrative or otherwise. In addition, the Parties shall have the right to offset any and all amounts owed while any such Event of Default or Section 15.03 Event of Default is continuing. No delay or omission to exercise any rights or remedy shall impair such right or remedy or constitute a waiver of the default or an acquiescence therein. Every right and remedy given by the Basic Agreements, by 'aw or in equity or otherwise, may be exercised from time to time, and as often as may be deemed expedient, by the non-defaulting Party.

l l

I l

l l

i , . _ _. . , . , _

ARTICLE XVI Special Remedies 16.01 Special Remedy. If (a) a Section 15.03 Event of Default has occurred and has continued for an additional 30 days but Vepco either cannot, or for any reason elects not to, exercise the rights provided by Section 15.03, or (b) if there exists any, Event of Default by Old Dominion pursuant to Section 15.01(a), (b), (d), (e) or (f), and such Event of Default has continued for 45 days in the case of Section 15.01(a) or (d) or for 15 days in the case of Section 15.01(b), then, upon notice to Old Dominion by Vepco, Old Dominion's Percentage Ownership Interest in the Facilities shall automatically be adjusted in accordance with the follow:ng formula, applied separately to each of the Facilities, to wit, North Anna Unit 1, North Anna Unit 2, the Common Facilities, the Support Facilities, the Operating Inventory and the Major Spare Parts. It is the l

l intention of the Parties that under this Section an adjustment l

l in Old Dominion's Percentage Ownership Interest in each of the Facilities shall be equal and simultaneous:

(F)AOI = (F)OI x LB-A)

B Where (F)AOI equals the adjusted Old Dominion's Percentage Ownership Interest in any of the Facilities, immediately subsequent to the cumulative adjustment effected by this Section 16.01; (F)OI equals Old Dominion's Percentage Ownership Interest in any of the Facilities at Closing; A equals the cumulative aggregate amount of all payments then owed (or previously owed to Vepco and which were previously a component of A under this formula) to Vepco under Article III or Section 15.03 hereof, including interest at the Special Interest Rate due thereon for the entire period of the default less taxes owed to Vepco with respect to amounts then owed pursuant to Article III or operating or maintenance expenses under the Interconnection and Operating Agreement; and B equals Old Dominion's Initial Purchase Price paid pursuant to Section 3.01 plus the aggregate amount of all payments previously made and the amounts then owed pursuant to Section 3.02, including appropriate allowances for AFUDC (determined in accordance with the provisions of Section 15.03(a)), Section 3.04 and Section 3.06 to the extent that such payments under Section 3.06

.,- . . = .._ _ .. , .

relate to the making of New Investment less the sum of the following:

(i) amounts Old Dominion may have paid as penalties, if any have been previously included in this item B; (ii) all amounts for taxes paid or owed by Old Dominion to Vepco with respect to the transactions contemplated by the Basic Agreements, (iii) depreciation and amortization accrued on the books of account of Old Dominion applicable to the Facilities, comprised of depreciation reflected in the determinati'on of the Initial Purchase Price (but depreciation reflected in the determination of the Initial Purchase Price shall not be deleted a second time in the application of this Subsection (iii)) and depreciation subsequent thereto determined in accordance with the same methodology used by Vepco, excluding depreciation

, and amortization applicable to all taxes reflected in (ii) above and (iv) any retirements applicable i

to Old Dominion's Percentage Ownership Interest in i

the Facilities, i

m- ---- ,-m.e , , , - . - . , ..e p -----,.m---n.v.m--- , . - - - , - , , - - --,----,re n,- - - .c-..~----, - - , . -

s Thereafter, each successive Event of Default covered under this Section in any month r. hall similarly further decrease Old Dominion's Percentage Ownership Interest in the Facilities, unless and until Vepco shall have exercised its right to purchase old Dominion's Percentage ownership Interest pursuant to Section 15.03.

16.02 Soecial Old Dominion Remedy. If for any reason there shall be an Event of Default by Vepco pursuant to Section 15.01(a), (b), (d) or (e) hereof for any of the Facilities and such Event of Default has continued for 45 days in the case of Section 15.01(a) or (d) or for 15 days in the case of Section 15.01(b), Old Dominien shall have the following rights. In the case of any Event of Default under Section 15.01(a), Old Dominion shall have the right, upon notice to Vepco by Old Dominion, to reduce Vepco's ownership interest in the manner provided below. In the case of an Event of Def ault under Section 15.01(b), (d) or (e), Old Dominion shall have the right, but not the obligation, to make such payment and if old Dominion makes such payment, then, upon notice to Vepco by Old Dominion, Old Dominion shall have the further right to reduce l

Vepco's ownership interest in the manner provided below. Upon giving the notice to Vepco required above, Old Dominion's Percentage Ownership Interest in the Facilities shall p ,

4 automatically be adjusted in accordance with the following formula, applied independently to each of the Facilities, to wit, North Anna Unit 1, North Anna Unit 2, the Common Eacilities, the Support Facilities, ti.e Operating Inventory and the Major Spare Parts. It is the intention of the parties that under this Section an adjustment in percentage ownership interest in each of the Facilities shall be equal and simultaneous:

(F)AOI = (F)OI x (B+A)

B Where (F)AOI equals the adjusted Old Dominion's Percentage Ownership Interest in the Facilities, immediately subsequent to the cumulative adjustment effected by tais Section 15.02; (F)OI equals Old Dominion's Percentage Ownership Interest in the Facilities at Closing; A equals the cumulative aggregate amount that Vepco owes Old Dominion (or previously owed by Vepco and which were previously a component of A under this formula) or amounts that Old Dominion has paid on Vepco's account, excluding such portion related to Old Dominion's Percentage Ownership Interest, including interest at the Special Interest Rate, for the entire period of all such defaults; and B equals Old Dominion's Initial Purchase Price paid for its interest pursuant to Section 3.01 plus the aggregate amount of all payments previously made and the amounts then owed pursuant to Section 3.02, including appropriate allowances for AFUDC (determined in accordance with the provisions of Section 15.03(a)), Section 3.04 and Section 3,06 to the extent that such payments relate to the making of New Investment (excluding any amount paid on behalf of Vepco in item A above), less the sum of the following:

(i) all amounts for taxes paid or owed by Old Dominion to Vepco with respect to the transactions contemplated by the Basic Agreements, and (ii) depreciation accrued on the books of account of Old Dominion applicable to the Facilities, comprised of depreciation reflected in the J e determination of the Initial Purchase Price (but depreciation reflected in the determination of the i

Initial Purchase Price shall not he deleted a second time in the application of this Subsection (ii)) and depreciation subsequent thereto determined in accordance with the same methodology

t used by Vepco, excluding depreciation and amortization applicable to all taxes reflected in (i) above, and (iii) any retirements applicable to Old Dominion's Percentage Ownership Interest in the Facilities.

Thereafter, each successive Event of Default by Vepco under Section 15.Ol(a), (b), (d) or (e) shall invoke this Section.

.--==

16.03 Failure to Perform-Remedy. The non-defaulting Party may, but shall not be required to, undertake to remedy any Event of Default under 15.01(b) at the expense of the defaulting Party and give notice of its intent to do so to the defaulting Party. If the Parties are in dispute as to whether an Event of Default exists under Section 15.01(b), the Party claiming such an Event of Defaul: may proceed to remedy the alleged Event of Default while pursuing the procedures for '

resolution of disputes provided in Section 20.03 but the third sentence of Section 20.03 shall not be applicable and the Party

! claiming no such Event of Default exists shall not be obligated I

to reimburse the other Party unless a court of competent jurisdiction has determined that such an Event of Default does exist, in which case the defaulting Party agrees to reimburse the non-defaulting Party, with interest at the Special Interest ,

Rate, for services, costs or property provided by the non-defaulting Party to remedy such Event of Default.

i

, ,.,,..._,_,__.r.. _ _ , , , - , _ . . . _ _ , _ .._.,, _. .

16.04 Rights and Obligations upon Recurchase or Transfer of Title.

(a) In the event of any transfer of or purchase of or adjustment of ownership interest pursuant to this Agreement, the Parties will execute and deliver further documents of title (conforming to the document requirements of Section 2.01) conveying to the other Party the interest in the Facilities required by this Agreement. Such interest shall be conveyed, at the option of the non-defaulting Party, free and clear of Liens other than Permitted Encumbrances, but, if conveyed free and clear of Liens, shall be subject to the following provisions:

Any interest acquired by Vepco in the Facilities, pursuant to Section 15.03 or by either Party pursuant to Section 16.01 or Section 16.02 as a result of a Section 15.03 Event of Default, chall be released, and shall be free and clear of Liens (other than Permitted Encumbrances) upon (1) payment of the purchase price as provided in Section 15.03(a),

in the case of a purchase, or (ii) notice to the other Party as provided in Section 16.01 or Section 16.02, in the case of an automatic adjustment pursuant thereto and (iii) then, in either case, subject to the next sentence, upon payment by the non-defaulting Party of an amount equal to (x) the percentage (not

the percentage points) of the ownership interest being acquired by the non-defaulting Party multiplied by (y) the amount of indebtedness, limited to the proceeds of which have been used by the defaulting Party to finance its ownership intere:t in the Facilities and which is secured by such Liens. When both (a) Vepco has acquired the interest in the Facilities pursuant to Section 16.01 and (b) the unpaid amount is owed for New Investment, then;, Vepco shall pay (i) the dollar amount represented by the percentage of any Superior Lien that is equal to the percentage (not the percentage points) by which i

Old Dominion's Percentaga Ownership Interest is being reduced i

pursuant to Section 16.01, minus (ii) the amount owed by Old f Dominion for New Investment times the ratio of (F)AOI divided l l

by (F)OI, as defined in Section 16.01. No payment shall be  !

l required if (i) minus (ii) is a negative number. Any amount paid by Vepco to the holder of a Superior Lien as provided above, or in the case of a purchase any amount that is a 1 i

negative number pursuant to Section 15.03(a), shall be then due to Vepco from Old Dominien with interest at the Special Interest Rate; provided, however, that the failure to pay such amounts shall not constitute a Section 15.03 Event of Default and thereby will not allow either a total buyout right pursuant l to Article XV or a reduction in ownership interest pursuant to Article XVI.

i t

- , . - - , _ _ . _ . , , . . - . _ _ . _ . - _ _ . . .. ..--..._...._.._..m_. , _ _ - _ , -

- - _ _ - . _ . . - = - -.

1 (b) In the event of any adjustment of ownership interest pursuant to this Article XVI and subject to the _

, proviso contained in Section 16.04(a), (i) any loss or expenses

. incurred by the acquiring Party in connection with such acquisition shall be due to such Party from the c4her Party. .

(ii) the acquiring Party shall give notice of such election in writing to the trustee or trustees of the other Party's bonds or other evidences of indebtedness and (iii) a closing to consummate the acquisition pursuant to this Article shall be promptly held at a time and place determined by the acquiring Party.

(c) Any acquisition pursuant to this Article shall be subject to the obtaining of applicable governmental and regulatory approvals and each Party shall take all necessary actions and shall execute, and file where appropriate, all legal documents that shall reasonably be

! requested by the non-defaulting Party to complete any 4

transaction contemplated by this Article XVI.

1 89-

. . - - - ..,n , , - -,--*w.. . . - - . . __-....-.,-,,,,.-,,~..,----.---.,._--.-.m. -

, . . _ , ~ - - ,

ARTICLE XVII Term of Agreement 17.01 Ter~mination. This Agreement shall terminate at the earlier of (a) when all the Facilities shall have been retired and decommissioned, when all payments required, including those required by Section 3.03 hereof, have been made (or when the Parties have entered into a final, definitive, further agreement providing for the permanent care of the Facilities, as permitted by such Section 3.03) and when Vepco's option to lease or purchase Old Dominion's Percentage Ownership Interest pursuant to Section 3.03 hereof shall have expired, (b) December 31', 2081, or (c) November 30, 1983 if the Closing shall not have been consummated.

17.02 Measuring Lives. If and to the extent that any of the rights and privileges granted under the provisions of this Agreement would, in the absence of the limitation imposed by this Section, be invalid or unenforceable as being in violation of the rule against perpetuity or any other rule of law relating to the vesting of interests in property or the suspension of the power of alienation of property, then it is agreed that notwithstanding any other provision of this Agreement, said options, rights and privileges, subject to the respective conditions governing the exercise of such options, n-_

- ,. ,- , - , , , , . , _ , --n-, . , , . _ _ - , , , , a , , ., -

y , -,

rights and privileges, shall be exercisable only during (a) a period which shall end 21 years after the death of the last survivor of che officers and members of the Board of Directorn of Vepco named in Exhibit U hereto, together with all such persons' children and grandchildren who are living on the date of the execution of this Agreement or (b) the specific applicable period of time expressed in this Agreement, whichever is shorter.

J ARTIOLE XVIII

. Accounting Matters 18.01 General Accounting Ms tters. Determinations by Vepco on all accounting matters related to the transactions contemplated by the Basic Agreements will be in accordance with Generally Accepted Accounting Principles and FERC's Uniform System of Accounts, utilizing the accrual method of accounting, unless otherwise specifically provided in the Basic Agreements or mutually agreed by the Parties or as prescribed by other regulatory agencies having jurisdiction, as in effect from time to time. The accounting system and procedures designed to implement and operate this Agreement and the other Basic Agreements will be developed with Vepco's resources and/or through a consultant. Cne-half of all costs incurred for the design, development and initial implementation of this system are to be borne by Old Dominion but Old Dominion's total obligation with respect to such design, development and initial implementation shall not exceed $150,000.

18.02 Right to Inspect Records, Etc. During normal business hours and subject to conditions consistent with the

conduct by Vepco of its regular business affairs and I

responsibilities, Vepco will provide Old Dominion, the Authorized Old Dominion Representative (s) or any auditor i

I

_ ._ . . _ . - - . _ . ~ - _ - - - - .- _ , . . . - . _ _ _ . . - _ . . _ - . . , _ . . . _ _ _ _ . . - _ _ , . - . . . _ _ _ . , _ _ _ _ - - _ . - - - . . . . . _ _

4 1

utilized by Old Dominion reasonably acceptable to Vepco or any P

nationally recognized accounting firm retained by Old Dominion, access to Vepco's bocks, records, and other documents directly related to the performance of Vepco's obligations under the i Basic Agreements (but excluding internal memoranda, records and documents relating to such matters and minutes of meetings.of the Board of Directors and committees thereof) and, upon request, copies thereof, which set forth (a) costs applicable ,

to the construction, operation, maintenance and retirement of the Facilities to the extent necessary to enable Old Dominion to verify the costs for which Old Dominion is billed pursuant to the provisions of this Agreement, (b) matters relating to the design, construction and operation and retirement of the Facilities in proceedings before any regulatory body or governmental agency having jurisdiction. Old Dominion will 4 bear the cost of any copying, review or audit of such books and records.

During normal business hours and subject to conditions consistent with the conduct by Old Dominion of its regular business affairs and responsibilities, Old Dominion will provide Vepco, the Authorized Vepec Representative (s), or any 1.

auditor utilized by Vepco reasonably acceptable to Old Dominion or any nationally recognized accounting firm retained by Vepco, t

i

- , - --r, . -n--, ,-,,-n, - , , + . , - - . , , - . - . --- --, .rn ----,,-,---,n.----n-,,- --,,,r., n,r- --,-

access to Old Dominion's books, records, and other documents, and, upon request, copies thereof, which relate to the Basic Agreements (but excluding internal memoranda, records and documents relating to such matters and minutes of meetings of the Board of Directors and committees thereof). Vepco will bear the cost of any copying, review or audit of such books and records. Notwithstanding the foregoing, however, neither Party shall be required to make available to the other Party any reports and information relating to personnel practices, staffing or labor relations (including internal memoranda, records and documents relating to such matters as minutes of meetings of the Board of Directors and committees thereef).

18.03 Other Audits. Old Dominion recognizes that Vepco is subject to audits by various Federal and State regulatory agencies. Should any adjustment be required by such audit which affects the Initial Purchase Price cr New Investment under this Agreement, the Parties agree to share i

such adjustment in proportion to their respective ownership j interests. Old Dominion also agrees to pay its pro rata share l of legal and other expenses incurred by Vepco in appealing any I

adjustment resulting from any such audit, which affects the Initial Purchase Price or New Investment under this Agreement.

I Any decision to appeal shall be subject to th2 provisions of Article VIII hereof.

i l 94_

l l

ARTICLE XIX Consultations and Mutual Cooperation; Authorized Representatives 19.01 Consultations and Mutual Cooperation. At least quarterly Vepco will meet with representatives of Old Dominion at One James River Plaza, Richmond, Virginia, or such other place as the Parties may agree, to report on the progress of construction and operation of the Facilities. Vepco and Old Dominion agree to use their mutual best efforts to cooperate fully with each other to develop and promote the mutual economic benefits to each of them contemplated by this Agreement.

19.02 Authorized Old Dominion Representatives. At the Closing, Old Dominion shall designate, it. writing, not more than two Authorized Old Dominion Representatives to act on its behalf with respect to all matters contemplated by this Agreement. The person or persons so designated by Old Dominion as Authorized Old Dominion Representatives may be chang 1d, in the sole discretion of Old Dominion and from time to time, by at least ten (10) days' prior written notice to Vepco.

19.03 Authorized Vepco Representatives. At the Closing Vepco shall designate, in writing, not more than four Authorized Vepco Representatives to act on its behalf with respect to all matters contemplated by this Agreement. Any of

the Authorized Vepco Representatives may be changed, in Vepco's sole discretion and from time to time, by at least ten (10) days' prior written notice to Old Dominion.

19.04 Proportional Voting. Notwithstanding any other provision of this Agreement, all voting by the Authorized Vepco Representatives and the Authorized Old Dominion Representatives shall be in proportion to the Party's respective undivided percentage ownership interests in the Facilities.

l-I ARTICLE XX Miscellaneous 20.01 SALE WITHOUT WARRANTY. THE FACILITIES TO BE SOLD UNDER THIS AGREEMENT SHALL BE SOLD ON AN "AS IS" BASIS, AND VEPCO MAKES NO WARRANTY OR REPRESENTATION WHATSOEVER, EXPRESS, IMPLIED OR STATUTORY, AND DISCLAIMS ANY AND ALL WARRANTIES, INCLUDING, WITHOUT LIMITATION, ANY REPRESENTATION OR WARRANTY AS TO THE VALUE, QUANTITY, QUALITY, CONDITION, SALABILITY, OBSOLESCENCE, MERCHANTABILITY, FITNESS OR SUITABILITY FOR USE OR WORKING ORDER OF ALL OR ANY PART OF SAID FACILITIES. NOTWITHSTANDING THE FOREGOING, OLD DOMINION SHALL HAVE THE BENEFIT, IN PROPORTION TO ITS OLD DOMINION'S PERCENTAGE OWNERSHIP INTEREST, OF ALL MANUFACTURERS', VENDORS' AND CONTRACTORS' WARRANTIES AND ALL PATENTS AND LICENSES, IF ANY, RUNNING TO VEPCO IN CONNECTION WITH THE FACILITIES TO BE SOLD UNDER THIS AGREEMENT, SUBJECT TO THE PROVISIONS OF SECTION 9.OS(f) HEREOF.

20.02 Non-Exclusive Sale. Vepco shall have the right l

to sell to others joint interests in any or all of its remaining interest in the Facilities upon such terms and i

conditions as Vepco may choose, but no such sale shall diminish Olc Dominion's Percentage Ownership Interest in the Facilities or diminish any other rights and interests of Old Dominion hereunder.

I l

i ,

, 20.03 No Arbitration; Resolution of Disputes. No Party shall have the right to arbitrate any dispute that might arise with respect to any of the Basic Agreements. Any disagreement between the Parties as to their rights or obligations under this Agreement shall first be addressed by consultation between the Authorized Vepco Representatives and the Authorized Old Dominion Representatives. In the event such representatives are unable to satisfactorily resolve their disagreement, they shall refer the matter to the Executive Committee created pursuant to Section 19.13 of the Inter-connection and Operating Agreement. No dispute as to the payment of an invoice rendered by either Party pursuant to any

of the Basic Agreements shall permit the other Party to delay payment of the disputed invoice, in full, on its payment date.

If the invoiced Party shall have paid any such disputed invoice, in full, on or before its payment date and if the Authorized Vepco Representatives and the Authorized Old Dominion Representatives, or the Executive Committee created pursuant to Section 19.13 of the Interconnection and Operating Agreement, or a court of competent jurisdiction, should later determine that a disputed invoice was for an amount in excess

] of the correct amount due, then the invoicing Party shall be obligated to refund the difference to the invoiced Party within i

o 1

.- - - - . - . . . - - , m ~g .__,_ _ . , , , - - , . , _ _ _ . _ . - , . _ _ , . - . . . . , . - . - - _ . _ . _ _ , . . _ . , , . _ , . .-

i.

4 ten (10)_ days of such determination with interest, if any, upon such amount as follows:

(a) If such difference L.aulted from a deviation  ;

t from an estinate not caused by error or bad faith, interest shall be payable at the Regular Interest Rate; (b) If such difference resulted from an error, interest shall be payable at the Regular Interest Rate; and (c) If such difference resulted from bad faith, such interest shall be payable at the Special Interest Rate.

20.04 Notices. Any notice, request, consent or other communication permitted or required by this Agreement (other than payments) shall be in writing and be deemed given when

^

delivered by hand or when deposited in the United States mail, first class, postage prepaid, and if to Vepco, addressed to:

Virginia Electric and Power Company P. O. Box 26666 Richmond, Virginia 23261 Attention: President i

With copies to: the Authorized Vepco Representatives designated by Vepco  ;

pursuant to Section 19.03 hereof and if to Old Dominion, addressed to:

Old Dominion Electric Cooperative l 5601 Chamberlayne Road Richmond, Virginia 23227 Attention: Executive Vice President With copies to: the Authorized Old Dominion [

Representatives designated by Old Dominion pursuant to Section 19.02 hereof 4

unless a different officer or address shall have been designated by either Party by notice in writing to the otner Party.

20.05 Holidays, Business Days. Any obligation to perform under this Agreement, including payment obligations, which shall become due on a non-business day shall become due upon the next business day. The term " business day" shall mean any day other than a day on which banking institutions in the City of Richmond, Virginia, are authorized by law to close.

20.06 Entire Agreement. This Agreement, together with the other Basic Agreements, constitutes the entire understanding between the Parties hereto, superseding any and all previous understandings, oral or written, pertaining to the subject matter contained herein and therein. No Party hereto has relied or will rely upon any oral or other written representation or oral or other written information made or given to such Party by any representative of the other Party or anyone on its behalf.

20.07 Amendments. This Agreement may not be amended, modified, or terminated, nor may any obligation hereunder be waived, orally, and no such amendment, modification, termination or waiver shall be effective for any purpose unless it is in writing, and signed by both Parties and all necessary l

-100-I

regulatory approvals, including the Administrator of REA, have been obtained.

20.08 Severability. In the event any of the terms, covenants or conditions of this Agreement, or amendments therefor, or the application of any such term, covenant or condition shall be held invalid by a court or governmental agency having jurisdiction, all of the other terms, covenants and conditions of this Agreement shall not be affected thereby and this Agreement shall remain in full force and effect unless the interests of either Party would be materially and adversely affected.

20.09 Relationshio of the Parcies. The duties, obligations and liabilities of the Parties are intended to be several and not joint or collective, and nothing herein contained shall ever be construed to create an association, I

trust, joint venture or partnership or impose a trust or partnership duty, obligation, or liability on or with regard to the Parties, although the Parties acknowledge that the ownership and operation of the Facilitios may constitute a partnership for tax purposes. The Parties shall be individually responsible for their own obligations as provided herein. Neither Party shall have the right or power to bind the other Party except as expressly provided in this Agreement.

-101-

20. ~ 0 Tax Election. Vepco and Old Dominion hereby agree that they will both elect to exclude the arrangement created by this Agreement from the application of Subchapter K of the Internal Revenue Code of 1954, as amended, and execute all documents required by either Party to effect that result.

20.11 Governing Law. This Agreement is mado under and shall be construed under and governed by the laws of the Commonwealth of Virginia.

20.12 No Waiver. The failure of either Party to enforce at any time any of the provisions of this Agreement, or to require at any time performance by the other Party of any of the provisions hereof, shall in no way be construed to be a waiver of such provisions, nor in any way to affect the validity of this Agreement or any part thereof, or the right of such Party thereafter to enforce each and every such provision.

20.13 Captions. The descriptive captions of the various Articles and Sections of this Agreement have been inserted for convenience of reference only and shall in no way modify or restrict any of the terms and provisions hereof.

20.14 Counterparts. This Agreement may be executed simultaneously in tuo or more counterparts, each of which shall l be deemed an original, but all of which together shall constitute one and the same instrument.

l i

l

-102-l

{

l l

20.15 Ginquiar and Plural;-Gender. Throughout this Agreement, whenever any word in the singular number is used, it should include the plural unless the context otherwise requires; and whenever the plural number is used, it.shall include the singular unless the context otherwise requires.

The use of the masculine shall include the feminine.

20.16 Equal Opportunity. During the performance of those parts of this Agreement relating to the construction by Vepco of any additions, .betterments, improvements or

, replacements to the Facilities, Old Dominion and Vepco agree as follows:

(i) The Parties will not discriminate against any employee or applicant for employment because of race, color, religion, sex, age or national origin. The Parties will take affirmative action to ensure that applicants are employed, and that employees are treated during employment without regard to their race, color religion, sex, or national origin. Such action shall 4

include, but not be limited to, the following:

employment,. upgrading, demotion or transfer; i _ recruitment or recruitment advertising; layoff or l

l, termination; rates of pay or other forms of compensation; and selection for training, including

-103-i l

i apprenticeship. The Parties agree to post in 4

conspicuous places, available to employees and applicants for employment, notices to be provided e

setting forth the previsions of this Equal Opportundty Clause.

T (ii) The Parties will, in all solicitations or l

advertisements for employees placed by or on behalf of  ;

either party, state that all qualified applicants will receive consideration for employment without regard to race, color, sex, or national origin.

(iii) The Parties will send to each labor union or

. t representative of workers with which it has a collective bargaining agreement or other contract or understanding, a notice to be provided advising the  !

i said labor union or workers' representatives of the Parties commitments under this Section, and shall post copies of the notice in. conspicuous places available to employees and applicants for employment.

(iv) The Parties will comply with all provisions of Executive Order 11246, dated September 24, 1965, and of the rules, regulations and relevant order of the Secretary of Labor.  ;

1

-104-

- ..,.. ., ,w,. , , - . _ . - ,,.,,...,,-.,w,,.,,-, ,__,..,..,-,m .,-r ..,,,.,y . , . . _ , . . . _ . , . _ , , , , .._..-.,---,.--,,m,rw,, ,

t (v) The Parties will furnish all information and reports required by Executive Order 11246, dated September 24, 1965, and by rules, regulations and relevant orders of the Secretary of Labor, or pursuant thereto, and will permit access to their books, records and accounts by the administering agency and the

, Secretary of Labor for purposes of investigation to ascertain compliance with such rules, regulations and orders.

(vi) In the event of either Party's noncompliance with the nondiscrimination clauses of this Agreement or with any of the said rules, regulations or orders, the Parties may be declared ineligible for further I

Government procedures authorized in Executive Order 11246, dated September 24, 1965, and such other sanctions may be imposed and remedies invoked as provided in said Executive Order or by rule, regulation or order of the Secretary of Labor, or as otherwise l .

l' provided by law.

l (vii) The Parties agree that, unless exempted by 1

the rules, regulations or orders of the Secretary of Labor issued pursuant to Section 204 of Executive Order 1124 % dated September 24, 1965, all subcontracts and I

-105-l i

_ . . _ _ - _ _ _ _ -- - _ _ _ _ ,_~ _ . - _.

i purchase orders will cite that such contract or i purchase orders are subject to Executive Order 11246 and such provisions will be binding upon each subcontracter or vander. he Pstties will take such action with respect to any subcontract or purchase i

order as the administering agency may direct as a means 4

of enforcing such provisions, including sanctions for

noncompliance; provided, however, that in the event  !

either Party becomes involved in, or is threatened with, litigation with a subcontractor or vendor as a tesult of such direction by the administering agency, 3

that Party may request the United States to enter into such litigation to protect the interests of the United 4

States.

20.17 Environment. The Parties shall comply with (1) l all applicable water and air pollution control standards imposed by federal or state statutes or regulations and (2) the provisions of any Environmental Impact Statement issued by the

. NRC with respect to the Facilities pursuant to the National Environmental Policy Act; and the Parties shall take all steps necessary to assure that all actions undertaken pursuant to

[ this Agreement by the Parties or others under the control

~

and/or direction of the Parties are in compliance with the I

-106-I i

l -

l l

P 9" 'm ai-9wu="w-gr- enre a e g e,P- -9 yme.-he** -wf tM4 M'me-t-" **='-r- f'i-=w=-NW's-'-Nf==9-+9-Wt'*F-* WW'e--+wyttv"w y--mv-v"mrm-'a weem-

provisions of this Section. Nothing in this Section 20.17 shall be construed to prevent the Parties from resisting, challenging, centesting or appealing any lav, statute, regulation or decision of any federal, state or local govarnment or agency which the Parties claims to be invalid, unlawful, unreasonable, arbitrary or capricious.

20.18 Kick-backs. In the acquisition, construction and completion of the Facilities pursuant to this Agreement, the Parties shall comply with all applicable statutes, ordinances, rules, and regulations pertaining to the work. The Parties acknowledge that thay are familiar with the Rural Electrification Act of 1936, as amended, the so-called Kick-Back Statute (48 Stat. 948), and regulations issued pursuant thereto, and 18 U.S.C. 287, 1001, as amended. The Parties understand that the obligations of the Parties are subject to the applicable regulations and orders of Governmental Agencies having jurisdiction over the Facilities.

20.19 Nonsegregated Facilities. The Parties certify that they do not maintain or provide for their employees any segregated facilities at any of their establishments, and that they do not permit their employees to perform services at any location, under their control, where segregated facilities are maintained. The Parties certify further that they will not

-107-

maintain or provide for their employees any segregated facilities at any of their establishments, and that they will 4

not permit their employees to perform services at any location,

.undar their control, where segregated facilities are maintained. The Parties agree that a breach of this certificatien is a violation of the Equal Cpportunity Clause in this Agreement. As used in this certification, the term 4

" segregated facilities" means any waiting rooms, work areas, restrooms and washrooms, restaurants and other eating areas, timeclocks, locker rooms and other storage or dressing areas, parking lots, drinking fountains, recreation or entertainment areas, transportation, and housing facilities provided for employees which are segregated by explicit directive or are in fact segregated on the basis of race, color, religion, or national origin, because of habit, local custom, or otherwise.

The Parties agree that (except where they have obtained identical certifications from proposed subcontractors for specific time periods) they will obtain identical certifications from proposed subcontractors prior to the award of subcontracts exceeding $10,000 which are not exempt from the provisions of the Equal Opportunity-Clause, and that they will retain such certification in their files.

-108-

20.20 Confidentiality. During the term of this Agreement, it may become necessary or desirable, from time to time, for one Party to provide to the other Party information which is either confidential or proprietary. The Party desiring to protect any such information (the labeling Party) may label such information as either confidential or proprietary and thereafter the other Party will not reproduce, copy, use or disclose (except when requ' ired by governmental authorities) any such information in whole or in part for any purpose without the written consent of the labeling Party. In disclosing confidential or proprietary information to governmental authorities, the disclosing Party shall cooperate with the labelling Party in minimizing the amount of such information furnished. At the specific request of the labelling Party, the other Party will endeavor to secure the agreement of such governmental authorities to maintcin specified portions of such information in confidence.

20.21 Historic Places. The Parties shall not, without approval in writing by the REA Administrator, use any portion of the funds made available to Vepco by Old Dominion pursuant to the terms of this Agreement to construct any facilities which will involve any district, site, building, structure or object which is included in the National Register of Historic

-109-1

k Places, maintained by the Secretary of the Interior pursuant to the Historic Sites Act of .935 and the National Historic

. Preservation Act.

20.22 Public Officials Not to Benefit. No member of or delegate to the Congress of the United States shall be admitted to any share or part of this Agreement or to any benefit to arise herefrom other than the receiving of electric service on the same terms accorded other consumers and other

. - than benefits, if any such person is a Vepco shareholder, that may accrue to Vepco shareholders generally.

I 20.23 Flood Insurance Act. Notwithstanding anything contained in this Agreement, neither Party shall be under any obligation to advance any funds to the other Party to finance the construction or acquisition of any building in any area heretofore identified by the Secretary of Housing and Urban Development, pursuant to the Flood Disaster Protection Act or 1973 (the " Flood Insurance Act") or any rules, regulations or orders issued to implement the Flood Insurance Act (" Rules"),

4 l as an area having special flood hazards, or to finance any l - facilities or materials to be located in any such building, or

! in any building owned or occupied by Vepco or Old Dominion l

located in such flood hazard area unless and until there have

~

been compliance with all other conditions of this Agreement

-110-L

<g t-

, ' t-i T

which are precedent to such advances, and the REA Administrator has determined, that (i) the community in which such: area [is located is then participating in the national flood ii.s;urance program, as required by the Flood-Insurance Act and any Rules and (ii) Vepco and Old Dominion have obtained flood insurance coverage with respect to such building and contents as may then be required pursuant to the Flood Insurance Act and any Rules.

20.24 Safety. In the acquisition, construction and completion of the Facilities pursuant to this Agreement, the "s, Parties shall at all times take all reasonable precautions for the safety cc employees at the Facilities and of the public at the Facilities, and shall comply with all applicable provisions

-of Federal, State and Municipal safety laws and building and construction codes,; including without limitation, all regulations of the Occupational Safety and Health Administration.

20.25 Buy dmerican. The Parties covenant that in the performance of this contract (1) at least Old Dominion's Percentage Ownership Interest in the total cost of the Facilities, including the total of all of the unmanufactured articles, materials and supplies used or to be used in the construction of or otherwise made a part of the Facilities

-111-l n ,

I i . ,

l 1

shall have been mined or produced in the United States and (2) at least Old Dominion's Percentage Ownership Interest in the total cost of the Facilities, including the total cost of all of the manufactured articles, materials, and supplies used or to be used in the construction of or otherwise made a part of the Facilities shall have been manufactured in the United States substantially all from articles, materials, or supplies mined, produced, or manufactured, as the case may be, in the United States. If any article, material, or supplies are partially mined, produced, or manufactured in the United States (said part being hereinafter called the "American Made Portion") and partially mined, produced, or manufactured somewhere other than in the United States, then only the cost of the American Made Portion shall be usec. in determining whether the requirements of the preceding sentence have been satisfied. At the Closing and from time to time thereafter when requested by Old Dominion or the REA Administrator, the Parties shall supply the REA Administrator or the party so requesting l

with information and documentation demonstrating that the Facilities were constructed in accordance with the requirements of this Section.

-112-

20.26 Merger of Documents. All understandings and agreements, written or oral, among the Parties prior to October 17, 1983, with respect to the matters herein contained, including the Principles for Agreement, dated October 20, 1981, l and the Purchase, Construction and Ownership Agreement, between Vepco and Old Dominion, executed on December 28, 1982 and the Purchase, Construction and Ownership Agreement dated as of December 28, 1982, but executed on March 4, 1983 (the " Original Purchase Agreements") have been superceded in all respects by this Purchase, Construction and Ownership Agreement, dated as of December 28, 1982, but amended and restated on October 17, 1983 and all such understandings and agreements prior to October 17, 1983, including the Principles for Agreement and the Original Purchase Agreements; are null and void and of no effect whatsoever.

-113-

- - - - _ ,-y

IN WITNESS WHEREOF, the Parties have hereto caused this amended and restated Agreement to be signed and sealed this

,17th day of October, 1983 by their duly authorized representatives.

VIRGINIA ELECTRIC AND POWER COMPANY L' Y

'.- William W. Berry President 1,

ATTEST: '-

m ._

- lAstAr1 3~.s '/ ':

t Linwood R.' Rob'pfruson Corporate Secretary OLD DOMINION ELECTRIC COOPERATIVE i

.- By ) Fi 83 h y K. Bowman President l ATTES .-

NG A James M. Reyn ds Secretar

-114-

STATE OF VIRGINIA:

to-wit:

CITY OF RICHMOND:

The foregoing instrument was acknowledged before me this 17th day of October, 1983 by William W. Berry and Linwood R. Robertson, President and Corporate Secretary, respectively, of Virginia Electric and Power Company, a Virginia corporation, on behalf of the corporation.

My commission expires: [ ot[ rn,/826~

J f W r j / .. k s b b o.. &

~ Notary Public

. .{ SEAL]

b

.++

t 4

-115-i

,_ -,_- ,. , , . . _ . , _ . . . . ~ . . , _ . _ _ _ . , . _ . , . ,..,-m . - , . . . , _. _ _ _ m _ _ , , _ _ _ , .-.

STATE OF VIRGINIA:

to-wit: '1 CITY OF RICHMOND:

The foregoing instrument was acknowledged before me this 17th day of October, 1.983 by Harry K. Bowman and James M.

Reynolds, President and Secretary, respectively, of Old Dominion Electric Cooperative, a Virginia cooperative, on behalf of the cooperative.

My commission expires: N'h '/ 3.7/ffb'

, /hnw/a-.

c lbdtGu L Notary Public e

t

-116-I I

INTERCONNECTION AND OPERATING AGREEMENT l

i t

Between i

VIRGINIA ELECTRIC AND POWER COMPANY and OLD DOMINION ELECTRIC COOPERATIVE

! . Dated: As of Qecember 28, 1982 Amended and Restated October 17, 1983 I

f l

l i

- - - - - . , , - - - + y . - , w .--y.. -e , , -, , - ~ ~ , - --

,-,.,.,...,,--,e

1 TABLE OF CONTENTS PAGE ARTICLE I'-- Definitions..................................... 3 1.01 Agreement.............................................. 3 1.02 Capability............................................. 3 1.03 Closing and Closing Date............................... 4 1.04 Cc;bined Electric Systems.............................. 4 1.05 Combined System Annual Peak Demand..................... 4 1.06 Combined System Monthly Capability..................... 4 1.07 Combined System Monthly Peak Demand.................... 4 1.08 Combined System Transmission Loss Percentage............................................. 4 1.09 Common Facilities...................................... 5 1.10 Events of Default...................................... 5 1.11 Executive Committee.................................... 5 1.12 Facilities............................................. 5 1.13 FERC................................................... 5 1.14 Holidays............................................... 6 1.15 Interconnected Systems................................. 6 1.16 Interconnection Points................................. 6 1.17 Interest Rates......................................... 6 1.18 North Anna Nuclear Power Station....................... 6 1.19 Old Dominion........................................... 7 1.20 Old Dominion Generation Resources. . . . . . . . . . . . . . . . . . . . .7 1.21 Old Dominion Members................................... 7 1.22 Old Dominion Monthly Accredited Energy................. 7 1.23 Old Dominion Monthly Accredited Firm Capacity........................................... . . .8 1.24 Old Dominion Monthly Accredited Non-firm Capacity............................................... 8 1.25 Old Dominion Monthly Billing Demand........~............ 8 1.26 Old Dominion Monthly Delivered Demand.................. 8 1.27 Old Dominion Monthly Delivered Energy.................. 9 1.28 Old Dominion Monthly Delivered SEPA Capacity........... 9 1.29 Old Dominion Monthly Delivered SEPA Energy........ . . . . .9 1.30 Old Dominion Monthly Demand............................ 9

, 1.31 Old Dominion Monthly Energy............................ 9 1.32 Old Dominion Monthly Excess Capacity.................. 10 1.33 Old Dominion Monthly Excess Energy.................... 10 1.34 Old Dominion Monthly Maximum Diversified

. Demand................................................ 10 1.35 Old Dominion Monthly Reserve and Supplemental

, Energy................................................ 10 1.36 Old Dominion Monthly Retained Capacity................ 10 1.37 Old Dominion Monthly Retained Energy.................. 11 1.38 Old Dominion Monthly Supplemental Demand.............. 11 4

}

, , ,. -,- ., .._..c. m. , . . _

.- , .m..,- -

r. - . , . - . - - . - . . _ ,

PAGE 1.39 Old Dominion Reserve Capacity......................... 11 1.40 Old Dominion System................................... 11 1.41 Operating Committee................................... 11 1.42 Parties............................................... 12 1.43 Planning Committee.................................... 12 1.44 Prudent Utility Practices............................. 12 1.45 Purchase, Construction and Ownership Agreement............................................. 12 1.46 REA................................................... 12 1.47 SEPA.......................... ....................... 13 1.48 System Reserve Margin..................... ........... 13 1.49 Vepco..................................... ........... 13 1.50 Vepco Monthly Purchased Capacity...................... 13 1.51 Vepco Monthly Purchased Energy........................ 14 1.52 Vepco System.......................................... 14 1.53 Wholesale Power. Contracts............................. 14 ARTICLE II -- Operating Committee........................... 15 2.01 Operating Committee................................... 15 2.02 Meetings and Voting Rights............................ 15 2.03 Duties of Operating Committee......................... 16 2.04 Exchange of Information............................... 16 2.05 Expenses of Operating Committee.......................

2,06 16 Resolution of Disputes................................ 17 2.07 SEPA Contract......................................... 17 ARTICLE III -- Joint Planning............................... 18 3.01 Planning Committee.................................... 18 3.02 Meetings and Voting Rights............................ 18 3.03 Duties of Planning Committee.......................... 19 3.04 Future Transmission Planning.......................... 20 3.05 Future Generation Planning............................ 21 3.06 Expenses of Planning Committee........................ 22 3.07 Resolution of Disputes................................ 22 ARTICLE IV -- Interconnection and Protection of j Systems....................................... 23 4.01 Obligation for Adequate Facilities.................... 23 4.02 Protection of Systems................................. 23 ARTICLE V -- Vepco's Authority and Responsibility

with Respect to Old Dominion's Generation..................................... 24 t

-ii-1

, , - . - - - . , - - - - - - - - - - - - - - ~ , ~ - - - - - ' ~ ~ - - ~ ~ ^

PAGE 5.01 Vepco as Agent of Old Dominion........................ 24 5.02 Scheduling and Dispatching Other Old Dominion Generation Facilities........................ 27 hRTICLE VI -- Transmission Services......................... 29 G.01 Transmission and Distribution Capacity................ 29 6.02 Other Wheeling - Old Dominion Capacity................ 30 6.03 Payments for Modifications............................ 31 6.04 Limitations on Charges for Transmission Services.............................................. 31 6.05 Changes in Rates...................................... 32 ARTICLE VII -- Entitlements to Capacity and Energy................. ........ 33 7.01 Entitlements of the Parties to Capacity and Energy............................................ 33 7.02 Buy-Back of Capacity and Energy From North Anna Units 1 and 2......................................... 33 7.03 Limitation on Buy-Back of Capacity from North Anna Units 1 and 2.............................. 34 7.04 Reductions in Buy-Back................................ 38 ARTICLE VIII -- Supplemental Demand and Energy and Reserve Capacity and Energy............. 39 8.01 Supplemental Demand.and Energy........................ 39 8.02 Charges for Purchases By Old Dominion Pursuant to Section 8.01....................................... 40 8.03 Increases and Reductions in Supplemental Demand................................................ 41 8.04 Purchase of Capacity by Old Dominion from Other Sources.................................... 44 8.05 Limitation on Vepco's Obligation to Serve Supplemental Demand and Provide Supplemental Energy................................... 45 8.06 Reserve Capacity and Energy and Charges Therefor Related to the Facilities.................... 46 8.07 Reserve Capacity and Reserve Capacity Charges for Jointly Planned Generation Resources.............. 47

-lii-

PACE 8.08 Reserve Capacity and Reserve Capacity Charges for Non-Jointly Planned Generation Resources............................................. 47 ARTICLE IX -- Interconnection Points........................ 49 9.01 Interconnection Points.......... ..................... 49 9.02 Existing Interconnection Points....................... 49 9.03 Facilities Charges.................................... 49 9.04 Modifications to Interconnection Points............... 50 9.05 Future Interconnection Points......................... 50 9.06 Filing Fees........................................... 52 9.07 Characte,ristics of Electricity........................ 52 9.08 Unusual Operating Conditions.......................... 53 9.09 Access at Interconnection Points...................... 55 9.10 Notification of System Changes........................ 55 9.11 Metering. ............................................ 55 ARTICLE X -- Billing................ ....................... 58 10.01 Billing Methods...................................... 58 10.02 Rendering B111....................................... 58 10.03 Payment...................................... ....... 59 10.04 Methods of Payment................................... 59 10.05 No Arbitration; Resolution of Disputes............... 60 10.06 Billing Adjustments.................................. 61 ARTICLE XI -- Maintenance of Power Factor................... 63 11.01 Power. Factor Limits.................................'. 63 11.02 Power Factor Monitoring.............................. 64 11.03 Old Dominion Option.................................. 64 11.04 Grace Period......................................... 65 11.05 Compensation for Deviations from Power Factor Limits............................................... 65 11.06 Changes in Charges................................... 66 l

ARTICLE XII -- Operating Costs.............................. 67 12.01 Operating Costs...................................... 67 12.02 Payment for Other Costs.............................. 67 l -iv-l l

l l

l l

l l

I

PAGE ARTICLE XIII -- Accounting Matters and Access to to Books and Records........................ 68 13.01 Responsibility and Method of Accounting.............. 68 13.02 Right to Inspect Records, Etc........................ 68 13.03 Confidentiality...................................... 70 ARTICLE XIV -- Liability, Service Interruptions and Fo rc e Ma j eu r e . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 71 14.01 Liability............................................ 71 14.02 Responsibility on Either Side of Interconnection Point................................ 73 14.03 Force Majeure........................................ 74 14.04 Remedy............................................... 75 ARTICLE XV -- Representations and Warranties................ 76 15.01 Representations and Warranties of Vepco.............. 76 15.02 Representations and Warranties of Old Dominion............................................. 77 15.03 Conditions Precedent to Closing...................... 80 15.04 Surviva1............................................. 80 ARTICLE XVI -- Term of Agreement............................ 81 ARTICLE XVII -- Filing with FERC............................ 82 ARTICLE XVIII -- Def'ault................'.................... 83 18.01 Events of Default.................................... 83 18.02 Vepco's Rights on Default of Old Dominion............ 84 18.03 Old Dominion's Rights on Default of Vepco............ 86 18.04 Dieputes Concerning Default.......................... 88 18.05 Additional Obligations............................... 88

18.06 Injunctive Relief.................................... 89 18.07 No Remedy Exclusive.................................. 89 l 18.08 Agreement to Pay All Costs to Cure Default........... 90 18.09 General Covenant by the Parties...................... 90 l

l ARTICLE XIX -- Miscellaneous................................ 91 19.01 No Delay............................................. 91

-v-l

PAGE 19.02 Further Documentation................................ 91 19.03 Notice............................................... 91 19.04 Headings Not to Affect Meaning....................... 92 19.05 No Association, Trust, Joint Venture or Partnership; Tax Matters............................. 92 19.06 Successors and Assigns............................... 93 19.07 Counterparts......................................... 93 19.08 Severabi1ity......................................... 93 19.09 Applicable Law....................................... 94 19.10 No Waiver............................................ 94 19.11 Computation of Time.................................. 94 19.12 Survivorship of Obligations.......................... 94 19.13 Executive Committee.................................. 95 19.14 Documents Superseded................................. 95 19.15 Entire Agreement..................................... 96 19.16 Non-Exclusive Agreement.............................. 96 19.17 Relationship of the Parties.......................... 96 19.18 Singular and Plura1.................................. 97 19.19 Equal Oportunity..................................... 97 19.20 Good Faith.......................................... 100 19.21 Merger of Documents................................. 100 19.22 Environment......................................... 100 19.23 Kick-backs.......................................... 100 19.24 Nonsegregated Facilities.. ......................... 100 19.25 Historic P1 aces..................................... 101 19.26 Public Officials Not to Benefit..................... 101 19.27 Flood Insurance Act................................. 101 19.28 Safety.............................................. 101 19.29 Buy American........................................ 101 l ARTICLE XX -- Amendment.................................... 102 l

APPENDICES Appendix'A -- Old Dominion Members l

l Appendix B -- Charges for Transmission Services Appendix C -- Charges for Capacity and Energy Sold by Old Dominion to Vepco i

1 Appendix D -- Determination of Amounts of Supplemental j bemand and Reserve and Supplemental Energy r

i 6

-vi-l

Appendix E -- Charges for Purchases by Old Dominion Appendix F -- Determination of Accumulated Deferred Income Taxes related to North Anna Units 1 and 2 Appendix G -- Charges for Reserve Capacity Appendix H -- Facilities Charges Appendix I -- Nominal Voltages Appendix J -- Billing Format Appendix K -- Maintenance of Power Factor Appendix L -- Charges for Operation and Maintenance of the Facilities Appendix M -- List of Contracts Between Vepco and Old Dominion Members To Be Superseded l

l i -vii-i i

i t

This AGREEMENT, dated as of December 28, 1982, but

_ amended and restated on October 17, 1983, between VIRGINIA ELECTRIC AND POWER COMPANY (Vepco), a Virginia public service corporation with its principal office at One James River Plaza, Richmond, Virginia and OLD DOMINION ELECTRIC COOPERATIVE (Old Dominion), a Virginia generation and transmission cooperative with its principal office at 5601 Chamberlayne Road, Richmond, Virginia, provides as follows:

WHEREAS, Vepco is a public service corporation engaged in furnishing electric utility service in portions of Virginia, North Carolina, and West Virginia, and as such owns and oper-ates facilities for the generation, transmission and distribu-tion of electricity within those states; and WHEREAS, Old Dominion is a generation and transmission cooperative organized and existing under the laws of the Com-monwealth of Virginia and is comprised of, among others, the Old Dominion Members. ,Old Dominion is charged with the respon-sibility of providing power and energy to its Old Dominion Mem-bers either through generation facilities owned by it or by the purchase of power and energy from others; and

WHEREAS, simultaneousl'y herewith, Vepco and Old Dominion have entered into a Purchase, Construction and Ownership Agree-ment, under which Vepco will sell and Old Dominion will pur-chase an ownership interest in North Anna Unit 1, North Anna Unit 2, Common Facilities, Support Facilities, Major Spare l Parts, Operating Inventory and the Nuclear Fuel used or to be used for North Anna Units 1 and 2 all as set forth in the Pur-chase, Construction and Ownership Agreement and Nuclear Fuel Agreement; and WHEREAS, pursuant to the Purchase, Construction and Own-ership Agreement, Vepco is to sell to Old Dominion a portion of i ts generation f acilities and, through this Agreement, has

, agreed to operate Old Dominion's portion of such generation, supplying to it at the Interconnection Points such electricity as is generated from Old Dominion's portion of these facili-

~

ties; and WHEREAS, Old Dominion will require capacity and energy in l an amount exceeding that available from its portion of genera-l l tion and may desire to purchase supplemental electric service from Vepco, or from others, or to construct and operate its own I generation facilities; and t

.WHEREAS, Vepco and Old Dominion desire to enter into this Agreement under which Vepco will provide, among other things, i Old Dominion Supplemental Demand and Energy, Reserve 7apacity and Energy and transmission service; and

. WHEREAS, under this Agreement, Old Dominion agrees to sell and Vepco agrees to purchase certain percentages of Old Dominion's entitlement to the capacity and associated energy in North Anna Units 1 and 2, respectively; NOW, THEREFORE, in consideration of the premises and the mutual obligations hereinafter stated, the parties hereto agree as follows:

ARTICLE I Definitions The following definitions shall be included as part of the Agreement. Other terms used herein shall have the respec-tive meanings set forth in the Purchase, Construction and Own-ership Agreement.

1.01 Agreement. This Interconnection and Operating Agreement dated as of December 28, 1982, but amended and

_res a et t d on October 17, 1983, between Vepco and Old Dominion.

1.02 Capability. The net summer or winter (as applica-ble) rating of a unit or other power supply resource, measured in megawatts, as determined by Vepco. Capability shall be established and modified in accordance with Prudent Utility Practices following the same methodology Vepco uses in establishing the capability of all generating units on its sys-tem.

t

1.03 Closing and Closing Date. The Closing and Closing Date provided for in Section 5.01 of the Purchase, Construction and Ownership Agreement.

1.04 Combined Electric Systems. The combined electric generating, transmission, and distribution facilities of the.

Vepco System and the Old Dominion System.

1.05 Combined System Annual Peak Demand. The maximum Combined System Monthly Peak Demand for the calendar year.

1.06 Combined System Monthly Capability. The sum of North Anna Unit 1 monthly Capability, North Anna Unit 2 monthly Capability, Old Dominion Monthly Accredited Firm and Non-firm Capacity plus the monthly Capability of all other Vepco owned or leased generation.

1.07 Combined System Monthly Peak Demand. The maximum combined net one-hour kilowatt demand at the generation level for that calendar month made up of the combined individual de-mands for that hour of Vepco and Old Dominion Members excluding those demands of the Old Dominion Members supplied through ar-rangements with parties other than Vepco.

) 1.08 Combined System Transmission Loss Percentage. The percentage determined from time to time by the Planning Commit-i tee as the five-year average of the calendar year system trans-mission energy losses. Should the Planning Committee determine through load flow simulations that capacity losses are greater i

I than 25% higher than transmission system energy losses, such load flow loss shall be used for transmission system capacity t losses for purposes of this Agreement.

1.09 Common Facilities. All those facilities, including but not limited to both real and personal property, exclusive of North. Anna Unit 1, North Anna Unit 2, Support Facilities, Nuclear Fuel, Operating Inventory and Major Spare Parts (as those terms are defined in the Purchase, Construction and Own- .

ership Agreement), which are purchased, leased or otherwise ob-tained only in connection with the' construction, operation and maintenance of more than one nuclear unit located at North Anna Nuclear Power Station. Co.amon Facilities are more specifically described as of the date hereof in Exhibit A of the Purchase, Construction and Ownership Agreement.

1.10 Events of Default. The events of default pursuant to Section 18.01 hereof.

1.1'1 Executive Committee. The committee as provided in Section 19.13 hereof.

1.12 Facilities. The Facilities, as defined in the Pur-chase, Construction and Ownership Agreement.

1.13 FERC. The Federal Energy Regulatory Commission, including any successor governmental agency.

,- - . , , - - - . . , . . - - . - - - - , - .-,---y .-%-w-----..._----,.------

1.14 Holidays. The days on which banking institutions in.the City of Richmond, Virginia, are authorized by law to close.

1.15 Interconnected Systems. The Vepco System and the Old Dominion System.

1.16 Interconnection Points. The points at which the Vepco System and the Old Dominion System are interconnected.

1.17 Interest Rates (a) Special Interest Rate. A rate per annum equal to the prime rate of The Chase Manhattan Bank, N.A., New York, New York, or its successor, in effect from time to time plus three percentage points (3%).

(b) Regular Rate. In the case of interest pay-ments owing to Vepco or Old Dominion pursuant to this Agree-ment, an interest rate per annum equal to the actual weighted cost-of short. term financing to the Party to whom the payment is owing for the period in question, or if the Party to whom the payment is owing has no short term financing outstanding at the time, the prime rate of the Chase Manhattan Bank, N.A. as in effect from time to time. Short term financing shall be as defined by the Uniform System of Accounts.

1.18 North Anna Nuclear Power Station. The nuclear generating plant located in Louisa, Orange, and Spotsylvania Counties, Virginia.

1 l

i

L 4 1.19 Old Dominion. Old Dominion Electric Cooperative, a Virginia generation and transmission cooperative, and its successors and assigns.

1.20 Old Dominion Generation Resources. Old Dominion Monthly Retained Capacity, Old. Dominion Monthly Accredited Firm and Non-firm Capacity, Old Dominion Monthly Delivered SEPA Ca-pacity and any additional generation resources obtained by Old Dominion through joint planning with Vepco pursuant to Section 3.05 of this Agreement; provided, however, any portion of an Old Dominion generating resource that serves demands of the Old Dominion members outside the area served by Vepco at retail or wholesale shall not be considered Old Dominion Generation Re-sources.

1.21 Old Dominion Members. For purposes of this Agree-ment, those rural electric distribution cooperatives, including.

their successors and assigns, each of which distributes elec-tricity in areas within which Vepco supplies electricity either at, wholesale or at retail. For purposes of this Agreement, the Old Dominion Members shall mean those cooperatives, together with their respective delivery points, listed in Appendix A, as

( the same shall be added to, or deleted from, from time to time.

l 1.22 Old Dominion Monthly Accredited Energy. The ener-gy associated with the Old Dominion Monthly Accredited Firm and Non-firm Capacity.

e

1.23 Old Dominion Monthly Accredited Firm Capacity.

Monthly firm capacity owned or obtained by Old Dominion pursu-ant to Section 8.03(b) of this Agreement. Firm capacity shall be that capacity determined by the Planning Committee as not requiring reserves.

f 1.24 Old Dominion Monthly Accredited Non-firm Capacity.

Monthly non-firm capacity owned or obtained by Old Dominion and accredited under Section 8.03(b) of this Agreement. Non-firm capacity shall be that capacity determined by the Planning Com-mittee as requiring reserves.

1.25 Old Dominion Monthly Billing Demand. The Old Do-minion Monthly Supplemental Demand plus, if any, the kilowatts by which the most recent 12-month average Old Dominion Monthly Maximum Diversified Demand exceeds 110% of the most recent 12-month avera.ge Old Dominion Monthly Delivered Demand with such excess being adjusted for transmission losses to reflect load at the generation level by multiplying by the factor of 100 divided by 100 minus the Combined System Transmission Loss Percentage.

1.26 Old Dominion Monthly Delivered Demand. The com-bined Old Dominion hourly demands measured at the Interconnection Points for the clock-hour during which the Com-bined System Monthly Peak Demand occurs.

1.27 Old Dominion Monthly Delivered Energy. The com-bined Old Dominion Members' energy requirements for that month measured at the Interconnection Points.

1.28 Old Dominion Monthly Delivered SEPA Capacity. The total megawatts of monthly capacity delivered at Old Dominion's Interconnection Points in accordance with contract (s) between j SEPA and Old Dominion Members.

1.29 Old Dominion Monthly Delivered SEPA Energy. The energy associated with the Old Dominion Monthly Delivered SEPA Capacity.

1.30 Old Dominion Monthly Demand. The Old Dominion Monthly Delivered Demand less Old Dominion Monthly Delivered SEPA Capacity with such difference being adjusted for transmis-sien losses to reflect load at the generation level by multi-plying by the factor of 100 divided by 100 minus the Combined System' Transmission Loss Percentage.

1.31 Old Dominion Monthly Energy. Old Dominion Monthly Delivered Energy less Old Dominion Monthly Delivered SEPA Ener-gy, as such energy may be available from time to time, with such difference being adjusted for transmission losses to re-1 l flect energy at the generation level by multiplying by the fac-tor of 100 divided by 100 minus the Combined System Transmis-sion Loss Percentage.

_g.

4

. -. , - - . - - - - - , . - , .------,-a.- ,,-n - , . - - - - g

q 1.32 Old Dominion Monthly Excess Capacity. The capaci-ty of Old Dominion generating resources (firm and non-firm),

which for that month are not Old Dominion Monthly Accredited Firm or Non-firm Capacity.

1.33 Old Dominion Monthly Excess Energy. The energy-associated with the Old Dominion Monthly Excess Capacity if such energy is assigned to the Combined Electric Systems by Old Dominion.

1.34 Old Dominion Monthly Maximum Diversified Demand.

The ccmbined Old Dominion Members monthly maximum coincident hourly demand measured at the Interconnection Points during the on-peak hours shown in the Rate Schedule attached as Appendix E.

1.35 Old Dominion Monthly Reserve and Supplemental Energy. The Old Dominion Monthly Energy less Old Dominion Monthly Retained Energy less Old Don. inion Monthly Accredited Energy and less any Old Dominion Monthly Excess E,nergy.

1.36 Old Dominion Monthly Retained Capacity. For each generating unit at the North Anna Nuclear Power Station, the Capability of such unit multiplied by the Old Dominion's Per-centage Ownership Interest (as defined in Section 1.28 of the Purchase, Construction and Ownership Agreement) in accordance with Section 7.01 of this Agreement and further multiplied by the difference between one and the fractional entitlement of

Old Dominion's Percentage Ownership Interest in such unit to be purchased by Vepco in accordance with Section 7.02 of this Agreement. The total Old Dominion Monthly Retained Capacity shall be the rum of such capacity for North Anna Units 1 and 2.

1.37 Old Dominion Monthly Retained Energy. The energy associated with Old Dominion Monthly Retained Capacity at the North Anna Nuclear Power Station.

1.38 Old Dominion Monthly Supplemental Demand. The Old Dominion Monthly Demand, less the Old Dominion Monthly Retained Capacity and less the Old Dominion Monthly Accredited Firm and Non-firm Capacity.

1.39 Old Dominion Reserve Cacacity. An amount in kilo-watts equal to: the sum of (a) the projected twelve month av-erage Old Dominion Retained Capacity and (b) the projected twelve month average Old Dominion Monthly Accredited Non-firm Capacity, such sum multiplied by the System Reserve Margin.

1.40 Old Dominion System. The generation, transmission,

~

distribution and other facilities owned or leased by Old Domin- ,

l l

ion and the Old Dominion Members as shown on their books of ac-count from time to time and located in the area served at

! wholesale or retail by Vepco.

. 1.41 Operating Committee. The committee as provided in l

Article II hereof.

l l

I l

l

1.42 Parties. Vepco and Old Dominion.

1.43 Planning Committee. The committee as provided in Article III hereof.

1,44 Prudent Utility Practices. Any of the practices, methods, and acts engaged in or accepted by a significant por-tion of the electric utility industry at the time the decision was made, or any of the practices, methods, and acts that, in the exercise of reasonable judgment in light of the facts known at the time the decision was made, would have been expected to accomplish the desired result at a reasonable cost consistent with reasonable reliability,, safety, expedition and protection of the environment. Prudent Utility Practices are not intended to be limited to the optimum practices, methods, or acts to the exclusicn of all others, but rather to a spectrum of possible practices, methods, or acts engaged in or accepted by a significant portion of the electric utility industry at the time the decision was made.

1.45 Purchase, Construction and Ownership Agreement.

i The Purchase, Construction and Ownership Agreement of even date herewith between Vepco and Old Dominion.

1.46 REA. The Rural Electrification Administration, including any successor governmental agency.

1.47 SEPA. The Southeastern Power Administration, including any successor governmental agency. ,

1.48 System Reserve Margin. Shall be determined for the month of the projected Combined System Annual Peak Demand as (1) the ratio of (a) the projected Combined System Monthly Capability in that month plus projected purchases from third parties in that month of the approximate reliability of the ,

Combined System Monthly Capability less projected sales to third parties in that month of the approximate reliability of the Combined System Monthly Capability, but in no event to in-clude purchases or sales of economy energy, emergency energy, or other such non-dependable transactions, divided by (b) the projected Combined System Annual Peak Demand (2) less one.

1.49 Vecco. Virginia Electric and Power Company, a Virginia public service corporation, and its successors and as-signs.

1.50 Veoco Monthly Purchased Capacity. Shall be for each generating unit at the North Anna Nuclear Power Station the Capability of such unit multiplied by the Old Dominion fractional entitlement to the Capability in accordance with l

Section 7.01 of this Agreement and further multiplied by the

( fractional entitlement of Vepco to purchase capacity from such unit in accordance with Section 7.02 of this Agreement. The total Vepco Monthly Purchased Capacity shall be the sum of such capacity for North Anna Units 1 and 2.

1.51 Vepco Monthly Purchased Energy. Shall be the ener-gy associated with Vepco Monthly Purchased Capacity.

1.52 Vepco System. The generation, transmiscion, dis-tribution and other facilities owned by Vepco as shown on its books of accounts from time to time or facilities leased by Vepco.

1.53 Wholesale Power Contracts. The several wholesale power contracts between Old Dominion and the Old Dominion Mem-bers for the purchase of electric energy and capacity by the Old Dominion Members from Old Dominion, as in effect from time to time.

i l

1

s ARTICLE II Operating Committee 2.01 Operating Committee. To coordinate operations in carrying out the termt of this Agreement, Vepco will appoint four members and Old Dominion will appoint two members to the Operating Committee. Each member of the Operating Committee shall be fully authorized to act on behalf of its Party with respect to all matters cer.templated by this Agreement but will not be authorized to alter or amend the Agreement. Each Party shall notify the other in writing of the names of the persons who will serve as the members of the Operating Committee and, if desired, the names of any persons who may serve as alternates when the members are unable to act. Vepco's members may be char ged, in "epco's sole discretion and from time to time, by at least ten (10) days' prior written notice to Old Dominion. Old Dominion's members may be changed, in Old Domin-ion's sole discretion and from time to time, by at least ten (10) days' prior written notice to Vepco.

2.02 Meetings and Voting Rights. Meetings shall be held at the discretion of the Operating Committee but at least shall be held quarterly. Minutes of each meeting shall be kept and shal) be approved by the Crerating Committee at its next subse-quent meeting. Decisions of the Operating Committee shall be made upon vote by the Operating Committee with the voting power t

, - _ _ , . . - _ , - - - - , . .. , .,. p. . . -., , . _ .

. , - - - - - _ - ~ . . . . , - n-. , . _ . , . , , , , - . - , . . , , , . .

3 of each Party determined by its entitlement to the capability of North Anna Units 1 and 2 as provided in Section 2.03 of the Purchase, Construction and ownership Agreement.

2.03 Duties of Operating Committee. The Operating Com-mittee shall, subject to Vepco's authority and obligations under Article V and any other limitations in this Agreement, act upon those matters relating (1) to the coordination of the operation-of all generation, transmission and distribution fa-cilities necessary for the implementation of this Agreement, (2) to the control of loads, energy flows and power factor, (3) to emergency curtailment programs, (4) to the establishment of committees, not specifically provided for in the Agreement, required for the orderly administration of the Agreement, and (5) to any cther matter in which cooperation, coordination or agreement is necessary.

2.04 Exchange of Information. Each Party will make l available, upon request, information used in, or useful to, the I

! administration of this Agreement. Other specific rights for information, such as meter testing, are covered in other parts of this Agreement.

2.05 Expenses of Operating Committee. The expenses of each member of the Operating Committee, and his alternate and associates, shall be borne by the Party he represents. Other l expenses of the Operating Committee will be shared as agreed

upon by the Committee. Any expense not agreed to unanimously by the Operating Committee shall be borne by the Party incur-ring it.

2.06 Resolutfon of Disputes. If any dispute should arise regarding the operating function that cannot be resolved by the Operating Committee, the dispute and the circumstances surrounding such dispute shall be presented to the Executive Committee, which is empowered in Section 19.13 to resolve such disputes.

2.07 SEPA Contract. The Parties agree that if and when Vepco's contract with SEPA is changed from time to time, the Operating Committee shall recommend to the Parties such modifi-cations in this Agreement as are necessary to conform with any such changes.

4 4 4 l

l

, - - , , . . -- - = - . - , , - - - - - - - , - - - - - - . - , - - - - . - - - - - - - - - - - -

_~. _ _ _ . . __ _ . _ _ . _ _ _ . _ . .. _.

i i

ARTICLE III Joint Planning 3.01. Planning Committee. In carrying out the terms of this Agreement, the farties agree to coordinate planning in ac-cordance with Prudent Utility Practices. Vepco will appoint r four members and Old Dominion will appoint two members to the

• Planning Committee. Each member of the Planning Committee shall be fully authorized to act on behalf of its Party with respect to all matters contemplated by this Agreement but will not be authorized to alter or amend the Agreement. Each Party shall notify the other in writing of the names of the persons who will serve as the members of the Planning Con.zittee and, if desired, the names of any persons who may serve as alternates uhen the members are unable to act. Vepco's members may be changed in Vepco's sole discretion and from time to time, by at least ten (10) days' prior written notice to Old Dominion. Old Dominion's members may be changed, in Old Dominion's sole dis-cretion and from_ time to time, by at least ten (10) days' prior written notice to Vepco.

3.02 Meetings and Voting Rights. Meetings shall be held at the discretion of the Planning Committee but at least shall be held quarterly. Minutes of each meeting shall be kept and shall be approved by the Planning Committee at its next subse-quent meeting. Decisions of the Planning Committee shall be i

.,,-m-. . , . . . .. , , . . . , . , _ , . . . ~ . , . . , , , _ , . _,___-.__..,.,_._1_____- m., ., _.. . . _ . . . , _ . _ _ . _ . _ , . . _ . . _ , . . , . . . _ _ , , , =.

made upon vote by the Planning Committee with the voting power of each Party determined by its entitlement to the capability of North Anna Units 1 and 2 as provided in Section 2.03 of the Purchase, Construction and Ownership Agreement.

3.03 Duties of Planning Committee.

(a) The Planning Committee shall be responsible for the coordination of planning for future Interconnection Points in accordance with the provisions of Article IX. To achieve greater reliability and economy of electric generation and transmission, the Planning Committee shall meet periodi-cally to consider in good faith joint planning of future gener-ation facilities and future transmission facilities in accor-dance with the provisions of Sections 3.04 and 3.05 of this Ar-ticle. Each Party will keep the other informed of its future needs and plans, and any changes necessitated by altered needs and plans may be jointly studied to develcp the plan of, addi-tions to, or alterations of existing facilities that will pro-duce the greatest benefits to Vepco and Old Dominion. Each Party will supply the Planning Committee all the information required to provide the best obtainable results from joint planning and will coor.linate the implementation of any agreed upon plan for the development of generation, transmission and other facilities necessary to provide service to Interconnection Points.

(b) For the purposes of joint planning, Old Do-ninion shall furnish Vepco annually, prior to January 1, a forecast of its system loads for at least the succeeding fif-teen (15) year period. Vepco shall furnish Old Dominion annu-ally, prior to January 1, a forecast of its system loads for at least the succeeding fifteen (15) year period and its target reserve level. If either Old Dominion or Vepco makes an offi-cial revision to the forecasts during the year, notification of such revision shall be given in writing to the other Party in a timely fashion. Each Party shall provide an explanation of any significant deviation from historic trends in its forecast.

(c) The Planning Committee shall jointly evaluate the growth of the combined Old Dominion and Vepco loads and the pla n for providing sufficient capacity to serve these loads.

Except as provided in Article VIII of this Agreement, each Party will be responsible for providing for its own capacity needs and may, aftar joint consideration of capacity needs for the Combined Electric Systems, pursue its own separate plan for expanIsion of generating facilities.

3.04 Future Transmission Planning. Vepco shall continue to plan and be responsible for its future transmission system and nothing in this Agreement shall change or alter Vepco's function in this area. Old Dominion's involvement in this phase of the planning function shall be limited to exchanging i

1

F informction regarding future transmission plar.s, and consideration by the Planning Committee of the effect of Interconnection Points described in Article IX of this Agree-ment on the Vepco transmission system. Vepco and Old Dominion agree to consider in the future joint ownership of transmission facilities where reasenable net benefits will accrue to both Parties.

3.05 Future Generation Planning. Old Dominion and Vepco will consider in good faith the systems of Vepco and Old Domin-ion together during the planning of future generation facili-ties so that the needs, other than Excluded Supplemental Capac-ity (as defined in Section 8.04), of each of the Parties may be included in any plan for future expansion of those facilities.

Each Party will kaep the other informed of its future needs and its future plans as changes occur in current plans or as new plans are developed so that both parties may pursue both joint and independent generation planning.

Vepco and Old Dominion agree to consider in the future

! joint ownership of generation resources where reasonable net benefits will accrue to both Parties. If either Party does not agree to joint ownership of a future generation rescurce, each l

Party shall be free to pursue its own separate plan for expan-sion of its system's generation resources and will have no veto over the plans of the other Party with regard to that Party's l future generation resources.

For purposes of Articles VT ind VIII, a generation re-source shall be deemed to have been jointly planned if both Parties have agreed that the generation resource is appropri-ate. Vepco, after consiceration of the needs of its system, its other customers, its stockholders and any other appropriate factors, shall not unreasonably withhold its approval for a jointly planned generation resource.

3.06 Expenses of Planning Committee. Each Party shall pay all expenses of its representatives. Other expenses i.

incurred in joint planning will be shared as agreed upon by the l Planning Committee. Any expense not agreed to unanimously by the Planning Committee shall be borne by the Party incurring it.

3.07 Resolution of Disputes. If any dispute should arise regarding the planning function that cannot be resolved by the Planning Committee, the dispute and the circumstances surrounding such dispute shall be presented to the Executive

~

- Committee, which is empowered in Secton 19.13 to resolve such disputes.

l

! 4 r .- ,,-,--e--- n---n--, , .,-.n.-- .-..e -~,-.-.-,---,-.c.-, , ., , -,, , - . , - - - - , ,

ARTICLE IV Interconnection and Protection of Systems 4.01 Obligation for Adequate Facilities. Vepco and Old Dominion are each obliged to provide, on its own system or through this Agreement and other arrangements, facilities or-service adequate to serve expected loads and to maintain all such facilities in a suitable condition of repair so that they may be operated in accordance with Prudent Utility Practices and not impose a burden on any other system.

4.02 Protection of Systems.

(a) Vepco and Old Dominion will install, maintain and operate, or will cause to be installed, maintained and op-erated, at its own expense, such protective equipment and switcl.ing, voltage controls, load shedding and emergency facil-ities as required to assure continuity and adequacy of these Interconnected Systems.

(b) Old Dominion shall refrain from, and shall require its Members to refrain from, any acts, transactions, and uses of equipment, appliances or devices which may have a significant adverse effect upon the reliability or characteris-tics of the Vepco System. Vepco shall refrain and shall re-quire its customers to refrain from any acts, transactions, and uses of equipment, appliances or devices which may have a sig-nificant adverse effect upon the reliability or characteristics of the Old Dominion System.

l t

y,-m , ,- . . , . - . . . -__ , - - - ,,,,,,-e--, --

ARTICLE V Vepco's Authority and Responsibility with_ Respect to Old Dominion's Generation 5.01 Vepco as Agent of Old Dominion.

(a) Old Dominion hereby appoints Vepco (such ap-pointment shall be irrevocable for the term of this Agreement and coupled with an interest) its sole agent, subject, however, to Old Dominion's right of reasonable inspection through autho-rized representatives,. to act on its behalf for the operatien, maintenance, modifications and fueling, including the prc:ure-ment of nuclear fuel, of the Facilities and authorizes Vepco in the name of and on behalf of Old Dominion to take all rea-sonable actions which, in the discretion and judgment of Vepco, are deemed necessary or advisable to effect the operation, maintenance, modifications and fueling, including the procure-ment of nuclear fue,1, of the Facilities, including, without limitation, the following:

(i) The making of such agreements and modi-fications of existing agreements and the taking of such other action as Vepco deems necessary or ap-propriate, in its sole discretion, or as may be required under the regulations or directives of such governmental bodies and regulatory agencies having jurisdiction, with respect to the l

i r _. _ . _ . -_ _. _

operation, maintenance, modifications and fueling -

(including the procurement of nuclear fuel) of the Facilities; (ii) The execution and filing with such gov-ernmental bodies and regulatory agencies having-jurisdiction of applications, amendments, reports and other documents and filings for or in connec-tion with licensing, operation and other regulato-ry matters with respect to the Facilities; and (iii) The receipt on Old Dominion's. behalf of any notice or other communication from any govern-mental body or regulatory agency having jurisdic-tion, as to any licensing, operation or other reg-ulatory matter with respect to the Facilities.

(b) As relates to all third parties, this agency

~

designation shall be binding on Old Dominion, and such appoint-ment shall be deemed in effect by each third party until termi-nation of this Agreement pursuant to the terms hereof and until such third party receives written notification from Vepco of any termination thereof.

(c) Vepco accepts such appointment. In discharging all of its duties and responsibilities hereunder, Vepco will act in good faith and in accordance with Prudent Utility Practices. Vepco's duties and responsibilities shall l

l l

\ l l

l

include, but not be limited to, establishing organi=ational structure and manpower requirements, maintaining an adequate work force through Vepco's personnel administration policies, arranging and procuring necessary or desirable materials and services for operation of the Facilities, determining scheduled outages for routine inspections, refueling and general mainte-nance, scheduling, dispatching and loading of the Facilities, preparing and filing applications, reports and other documents relating to operation of the Facilities, establishing reason-able rules for visits to the Facilities, and determining the need for, and subsequently constructing, any capital additions or modifications to the Facilities. Vepco shall not, solely because of Old Dominion's Percentage Ownership Interest in the Facilities, make any adverse distinctions in operation, mainte-nance, modifications, fueling, scheduling, or dispatching as between the Facilities and any other generating unit or facili-ties in which Vepco has an ownership interest. Nothing herein shall interfere with Vepco's authority and responsibility for the operation of, maintenance of, modifications to, fueling of, and improvements to all of its other generation facilities.

Vepco shall make available upon request by Old Dominion regu-larly prepared montnly reports which contain specific informa-tion on all generating facilities including, but not limited to, operating expenses, maintenance expenses, fuel expenses,

~

generating statistics, fuel reports, operating statistics and other information reasonably available. Vepco will also have the right to submit data relating to operation of the Facili-ties to any other entity. Olc Dominion will make available all information or data necessary for Vepco to schedule and dis -

patch generation.

(d) Old Dominion agrees that it will take all necessary action in a prompt manner to execute any agreements with respect to the operation, maintenance, modifications and fueling of the Facilities as and when requested by Vepco.to permit Vepco to carry out its authority and responsibilities

. pursuant to this Section 5.01.

. 5.02 Scheduling and Dispatching other Old Dominion Generation Facilities. Old Dominion shall authorize and Vepco shall agree to schedule and dispatch all generation within Vepco's service area jointly or non-jointly planned that Old Dominion may subsequently own or control or have the right to schedule and/or dispatch including unit sales of capacity and energy. The scheduling and/or dispatching of all generation

, outside Vepco's service area that Old Dominion may subsequently 1

l own or control, or have the right to schedule and/or dispatch, including unit sales of capacity and energy involved in power sales outside the Vepco service area shall be covered in other j agreements relating to the specific transaction contemplated.

i l

It is the intent of the Parties that Old Dominion shall authorize Vepco and Vepco shall agree to schedule and/or dis-patch Old Dominion's other generation resources within and out-side Vepco's service area provided arrangements to effect such operation can be reached to the satisfaction of both Parties o

O 1

ARTICLE VI 2

Transmission Services

6. .1 Transmission and Distribution Capacity. Vepco will make available to Old Dominion Vepco's transmission and distri-bution facilities as needed to transfer to each Interconnection Point Old Dominion Monthly Supplemental Demand and Energy and Reserve Capacity and. Energy, Old Dominion Retained Capacity and 1

Energy, Old Dominion Monthly Accredited Firm and Non-firm Ca-pacity and Energy, Old Dominion Monthly Delivered SEPA Capacity and Energy, Old Dominion Monthly Excess Energy, and capacity and associated energy owned by Old Dominion in other facilities jointly planned with Vepco. Vepco will also make available to Old Dominion Vepco's transmission and distribution facilities as needed te transfer the output and reserves associated there-with of Old Dominion generating resources that have been joint-l ly planned with Vepco to points of interconnection between the Combined Electric Systems and other systems. The charges for the use of the Vepco transmission and distribution facilities are set'forth in Appendix B of this Agreement, except for those transmission and distribution charges associated with Supple-mental Demand and Energy that will be included in the charges set forth in Appendix E.

6.02 Other Wheeling - Old Dominion Capacity. If Old Do-minion installs or obtains access to generating resources with-out jointly planning such facilities with Vepco, Old Dominion shall have access to Vepco's transmission and distribution fa-cilities for transferring capacity and energy from such generating resources only after such time as Old Dominion shall have provided, at its-own expense, transmission facilities nec-essary to connect such facilities to the Vepco System and shall have paid all costs of any modifications to Vepco's then exist-ing transmission system which are required to connect these generating resources to the Vepco system in a manner acceptable to and prescribed by Vepco as if Vepco were itself installing the generation. In addition, Old Dominion shall be responsible for paying a.1 costs, at the time those costs are incurred, of required modifications determined at the time Old Dominion re-quests such access to the Vepco System and shall bear the costs of operating and maintaining the system modifications. In such circumstances, Vepco will not oppose any Old Dominion applica-tion to a governmental agency for permission to construct the transmission facilities necessary to connect the generating fa-cilities to the Vepco System. Vepco must use Prudent Utility Practices as the basis for developing the required transmission facilities and will not unreasonably withhold from Old Dominion access to its transmission system. At the time Old Dominion i

._ _ _ _ . _ . .- _ __ _ - _. m . . . . . - -

requests access to the Vepco System, if the Planning Committee determines and to the extent it so determines that system modi-fications paid for by Old Dominion enhance the Vepco transmis-sion system to the benefit of Vepco's other customers, then Vepco shall be responsible for reimbursing or otherwise crediting Old Dominion for these enhancements at the time these enhancements commence. The charges for transmission services i

are set forth in Appendix B of this Agreement.

6.03 Payments for Modifications. Payments or other sat-isfactory arrangements for modifications to the Vepco transmis-sion system pursuant to Section 6.02 must be completed before such additional capacity or energy is transferred through Vepco's transmission system.

6.04 Limitations on Charges for Transmission Services.

The charges allocated to Old Dominion for the use of the Vepco transmission and distribution facilities set forth in Appendix B or included in the charges set forth in Appendix E shall not

, include the costs of any transmission ~ facilities included as a part of the Facilities or the cost of transmission facilities put into service after Closing that are specifically assigned to loads other than Old Dominion, but shall include the full cost of transmission facilities, if any, paid for by Vepco and i

put into service after Closing that are utilized solely by Old Dominion.

I

6.05 Changes in Rates. Except as limited in Section 6.04, nothing contained herein shall be construed as affecting in any way the right of Vepco to unilaterally file with FERC for a change in the rates contained in Appendix B hereto under Section 205 of the Federal Power Act and pursuant to the Com-mission's Rules and Regulations promulgated thereunder. In ad-dition, except as limited in Section 6.04, nothing contained herein shall limit or modify in any respect Old Dominion's legal rights to oppose, in whole or in part, Vepco's filing for a change in the rates contained in Appendix B hereto or to com-plain of the rates in Appendix B pursuant to Section 206 of the Federal Power Act.

ARTICLE VII Entitlements to Capacity and Energy 7.01 Entitlements of the Parties to Capacity and Energy.

Subject to the provisions in Section 7.02 herein, and to the provisions of Sections 15.03, 16.01 and 16.02 of the Purchase, Construction and Ownership Agreement, Old Dominion shall be en-titled to 11.6% of the capacity and energy from North Anna Units 1 and 2. Subject to the provisions of Section 7.02 here-in, and to the provisions of Sections 15.03, 16.01 and 16.02 of the Purchase, Construction and Ownership Agreement, Vepco shall be entitled to the balance of the capacity and energy from each unit.

7.02 Buy-Back of Capacity and Energy from North Anna Units 1 and 2. Subject to the provisions of Sections 7.03 and 7.04 herein, Vepco agrees to purchase and Old Dominion agrees to sell in the following calendar years the percentage of Old Dominion's entitlement to capacity and energy from North Anna Units 1 and 2 pursuant to Section 7.01:

, . v--- - ~ -

i l

Calendar Year P_ercentage 1983 36%

1984 32%

1985 28%

1986 24%

1987 20%

, 1988 16%

1989 12%

1990 8%

1991 4%

Vepco and Old Dominion agree that, subject to Section 7.03, Old Dominion shall be paid by Vepco for this capacity and energy on a monthly basis in the amounts calculated pursuant to Appendix C.

7.03 Limitation en Buy-Back of Capacity from North Anna .

Units 1 and 2.

(a) Outages Co'mmencing Prior to January 1, 1986.

Whenever (1) any outage commencing prior to January 1, 1986 of North Anna Unit 1 exceeds 120 consecutive days for any reason or (2) any multiple outages commencing prior to January 1, 1986 of North Anna Unit 1 exceed 120 days within any 180-day period provided such multiple outages are from the same cause or (3) any outage commencing prior to January 1, 1986 of North Anna Unit 2 exceeds 120 consecutive days for any reason or (4) any multiple outages commencing prior to January 1, 1986 of North Anna Unit 2 exceed 120 days within any ISO-day period provided such multiple outages are from the same cause, Vepco's f .

t i .

.-,...m. . ,,_ ._. . , . . _ . , . , _ - _ , . , . - . _ . . ._, . . , _ _ . , , . . . _ . , _ _ . _ _ _ . . , _ _ . _ , . _ - _ _ . . - . , . . , _ _ . _ , - . . _ _ _ , ,

obligation, pursuant to Section 7.02, to purchase capacity from the Unit experiencing the outage or outages, and its obligation to make payment therefor, shall thereafter be limited in the following manner: Until the Unit returns to operation or until 30 months shall have passed from the commencment of this buy-back limitation, whichever is earlier, Vepco's obligation to purchase capacity shall be the lesser of (i) the capacity from that Unit which would otherwise have been purchased pursuant to Section 7.02 for the calendar year (s) of the outage (s), or (ii) the difference between (1) Old Dominion's Percentage Ownership Interest in that Unit during such period (s) of the outage (s) and (2) the greater of Old Dominion's load ratio share, defined to be Old Dominion Monthly Demand at the time of the Combined System Annual Peak Demand divided by the Combined System Annual Peak Demand less Old Dominion Monthly Delivered SEPA Capacity adjusted for transmission losses, for either the calendar year next preceding the year of such purchase or the calendar year next preceding the year of Closing, multiplied by the Capabili-ty of the Unit; provided, however, if this amount computed under (ii) is a negative number then the amount computed under (ii) shall be deemed to be zero. At the end of this 30-month period, if the Unit has not returned to operation, then Vepco's obligation to buy back capacity pursuant to Section 7.02 shall cease until the Unit returns to operation. When the Unit

,_ e -_ --e

,w, , --,,m-- , , - - , - - , - , , - , ,-

e n,, e-- - ,.4-,e

j returns to operation, Vepco's obligation to buy back capacity and energy shall be as stated in Section 7.02.

(b) Outages Commencing On and After January 1, i

l 1986. Unless Vepco's obligation shall have expired earlier, ,

whenever (1) any outage commencing on or after January 1, 1986 of North Anna Unit 1 exceeds 120 consecutive days for any rea-

~

l son or (2) any multiple outages commencing on or after January 1, 1986 of North Anna Unit 1 exceed 120 days within any 180-day 1 i

period provioed such multiple outages are from the same cause i or (3) any outage commencing on or after January 1, 1986 of North Anna Unit 2 exceeds 120 consecutive days for any reason or (4) any multiple outages commencing on or after January 1, 1986 exceed 120 days within any ISO-day period provided such l multiple outages are from the same cause, Vepco's obligation, i

pursuant to Section 7.02, to purchase capacity from the Unit experiencing the outage or outages, and its obligation to make payment therefor, shall thereafter be limited in the following

'mamner : Until the Unit returns to operation- or until 18 months shall have passed from the commencement of this buy-back limi-  ;

tation, whichever is earlier, Vepco's obligation to purchase capacity shall be the lesser of (i) the capacity from that Unit which would otherwise have been purchased pursuant to Section 7.02 fer the calendar year (s) of the outage (s), or (ii) the difference between (1) Old Dominion's Percentage ownership ,

l l

Interest in that Unit during such period (s) of the outage (s) and (2) the creater of Old Dominion's load ratio share defined to be Old Dominion Monthly Demand at the time of the Combined System Annual Peak Demand divided by the Combined System Annual Peak Demand less Old Dominion Monthly Delivered SEPA Capacity adjusted for transmission losses for either the calendar year next preceding ths year of such purchase or for the calendar .

year next preceding the year of Closing, multiplied by the Ca-1 pability of the Unit; provided, however, if this amount com-puted under (ii) is a negative number then the amount computed under (ii) shall be deemed to be zero. At the end of this 18-month period, if the Unit has not returned to operation, then Vepco's obligation to buy back capacity pursuant to Section 7.02 shall cease until the Unit returns to operation, provided that if Vepco's obligation to buy back capacity pursuant to Section 7.02 shall have expired prior to the Unit's return to operation then Vepco shall have no further obligation to pur-chase capacity. When the Unit returns to operation, Vepco's obligation to buy back capacity and energy shall be as stated in Section 7.02.

(c) Buy-Back Price Limitation. During any buy-back limitation period pursuant to Section 7.03(a) or (b), the 15 percent addition to Old Dominion's capacity costs provided for in Appendix C shall be eliminated from the price of the buy-back.

i s

37-t 98 P" V 'P-+ 3-'W W 7e-v" gt -

Ny-- po wc 2 Wy vim 33-9-y r-- e- *,,re -T--ir--eeN4*g e~yW**m=e %- -a-- w-*- w+-me--e----v+++vyyv--++-----*+?v +p a- pr - - P--'

(d) Same Cause. For purposes of this Section 7.03, multiple outages from the same cause shall be limited to (1) multiple outages occurring because of a specific regulatory mandate or (ii) multiple outages to repair, replace or maintain a major specifically identifiable component or solve a major.

specifically identifiable condition of the Facilities or Nucle-ar Fuel.

7.04 Reductions in Buy-Back. Vepco may reduce its pur-chases of capacity from North Anna Unit 1 and North Anna Unit 2 by one-half megawatt from each Unit for each megawatt by which Old Dominion reduces its supplemental demand pursuant to Sec-

! tion 8.03 tereof; provided, however, Vepco shall notify old Do-minion by November 1 of each year as to Vepco's reductions in its purchases of capacity for the succeeding year.

t l

l l

8 l

ARTICLE VIII Supplemental Demand and Energy and Reserve Capacity and Energy 8.01 Supplemental Demand and Energy.

(a) Supplemental Demand. Ecr the duration of this Agreement, Vepco shall sell monthly to Old Dominion and Old Dominion shall purchase monthly from Vepco, Old Dominion's entire monthly requirements for supplemental demand in the amounts necessary to supply the needs of the Old Dominion Mem-bers not met from Old Dominion Generation Resources. The cal-culation to determine monthly supplemental demand shall be as set forth in Appendix D.

(b) Supplemental Energy. For the duration of this Agreement, Vepco shall make available for sale to Old Do-minion Old Dominion's entire requi:ements for supplemental en-ergy in the amounts necessary to supply the needs of the Old Dominion Members not met from Old Dominion Monthly Retained En-ergy, Old Dominion Monthly Accredited Energy, Old Dominion Monthly Delivered SEPA Energy, Old Do' minion Monthly Excess En-ergy, and energy associated with any additional generation re-source obtained by Old Dominion through joint planning with Vepco pursuant to Section 3.05 of this Agreement. There shall be no restrictions on the amounts by which Old Dominion may re-duce its purchase of supplemental energy. The calculation to determine monthly supplemental energy shall be as set forth in Appendix D.

8.02 Charqua for Purchases By Old Dominion Pursuant to Section 8.01. For purchases by Old Dominion pursuant to Sec-

, tion 8.01, Old Dominion shall pay Vepco at the rates set forth

. initially in Appendix E. Except as provided below in this Sec-tion 8.02 and except as limited in Section 6.04, nothing f contained herein shall be construed as affecting in any way the right of Vepco to unilaterally file with FERC for a change in the rates contained in Appendix E hereto under Section 205 of the Federal Power Act and purcuant to the Commission's Rules and Regulations promulgated thereunder. In addition, except as provided below in this Section 8.02 and except as limited in Section 6.04, nothing contained herein shall limit or modify in any respect Old Dominion's legal rights to oppose, in whole or in part, Vepco's filing for a changa in the rates contained in Appendix E hereto or to complain of the rates in Appendix E

' pursuant to Section 206 of the Federal Power Act. The rates

shall, however, be based on the following principles in i .

determining the charges: (a) all amounts associated with the Facilities and Nuclear Fuel associated with the Facilities l

shall be excluded; (b) the demand allocation factor for produc-tion plant shall be based on the ratio of (1) the sum of the twelve Old Dominion Monthly Supplemental Demands to (2) the sum of the twelve Combined System Monthly Peak Demands less the de-mands at the generation level served by the Facilities; (c) the l

l

., . _ _ - - - - , - , . , _ - - - - - - - , - - . - ~ _ _ - . , - _ . . ~ , - _ , - - . _ _ . . _ - . _ _ - _ . - - - , - - - . , , _ - ~ , , - _ _ - - -

{

costs of abandoning North Anna Unit 4 and Surry Units 3 and 4, excluding the amounts associated with the Facilities, will con-tinue to be amortized over the period heretofore authorized by FERC, the unamortized portion of such costs shall not be in-cluded in rate base (nor shall accumulated deferred income taxes applicable thereto be utilized to reduce rate base) and such Obandonment costs shall be allocated to Old Dominion on the basis of (b) above; (d) the costs of abandoning North Anna Unit 3 shall be included pursuant to the ratemaking method adopted by FERC upon application by Vepco; (e) the charges to be paid by Old Dominion for reserve capacity to be paid pursu-ant to Section 8.06 of this Agreement divided by Old Dominion's Monthly Retained Capacity expressed as a percentage of the Ca-pability of the Units snall be excluded; and (f) 7.2% of tha total accumulated unamortized deferred income taxes resulting from North Anna Units 1 and 2 reflected in Vepco's rates in ef-feet as of the Closing as determined in accordance with Appen-dix F shall be subtracted from the rate base allocated to Old Dominion and the amortization thereof shall be reflected in the cost of service determination.

8.03 Increases and Reductions in Supplemental Demand.

(a) Increases in Supplemental Demand. Old Domin-ion may not increase its supplemental demand requirements be-yond that occasioned by normally expected load growth unless 4

, , - , ,y-n.---r - , - , , - ~ . - a-- . - - , - -,---,~m ,,--,-n-.--,---r-. , - - - - , , , - - ,

Vepco shall agree. Vepco agrees to provide supplemental demand in the. amounts required by Old Dominion to serve its present and future demands, except such increases in demands which may 4 arise.from an undertaking by Old Dominion, or one or more of its Members, to serve (1) a source of demand outside the area

] served by Vepco at retail or wholesale at the time of a request to Vepco for service or (2). any additional load which is sub-stantially different from the size and type of load included by Vepco in its system planning and which, if served, (i) would

. compel an enlargement of Vepco's generation or transmission fa-4 cilities not otherwise included by Vepco in its system planning or (ii) would impair ~Vepco's ability to render reasonably ade-l quate service to its other retail and wholesale customers.

However, a new customer imposing a load in excess of 100 megawatts shall not be defined as normally expected load growth unless sufficient notice shall have been provided to Vepco.

(b) Reductions in Supplemental Demand. Supple-mental demand purchased from Vepco may be reduced (1) by the construction of jointly owned facilities or (2) by obtaining additional Old Dominion Generation Resources as provided below:

(i) With nine years advance notice in writing to Vepco,.Old Dominion may obtain additional Old Dominion Generation Resources up to the total amount of supplemen-tal demand Old Dominion would otherwise have purchased from Vepco.

l -- . ._ . _ , . , ,. _ ~ _._ _ _ _ __-. _ . - - -- _ ~ - - - . - -

(ii) Notwithstanding subparagraph (i) above, Old Dominion shall have the right to purchase or place in service annually additional Old Dominion Generation Re-sources, without the nine-year advance notice require-ment, and thereby reduce the amount of supplemental de-mand, only in the following limited manner:

Calendar year 1983 through calendar year 1985:

Old Dominion may purchase or place in service an-nually additional Old Dominion Generation Resoure-es so that Old Dominion may reduce each year its monthly supplemental demand by an amount not ex-ceeding 2.5% of the maximum Old Dominion Monthly Delivered Demand in the immediately preceding cal-endar year.

Calendar year 1986 and thereafter: Old Dominion

, may purchase or place in service annually addi-tional Old Dominion Generation Resources so that Old Dominion may reduce each year its monthly sup-l l plemental demand by an amount not exceeding 4% of

, the maximum Old Dominion Monthly Delivered Demand l

l in the immediatel' ereceding calendar year.

The Parties agree t' 4 .n  ? event shall the monthly re-l l duction in supplemental c#mana t e.sulting from additional Old Dominion Generation Resources pursuant to this subparagraph i

l

(ii) exceed the percentage stated for any particular calendar year, and in no event shall any allowed, but unused, percentage reduction in supplemental demand resulting from additional Old Dominion veneration Resources be cumulative from year to year.

For any calendar year in which Old Dominion desires to elect to reduce its supplemental demand pursuant to this subparagraph (ii), Old Dominion shall notify Vepco by October 1 of the pre-ceding year. The additional Old Dominion Generation Resources purchased or placed in service in accordance with this Section shall thereafter, for purposes of this Agreement, be Old Domin-ion Monthly Accredited Non-firm Capacity if reserves are required pursuant to Sections 8.07 or 8.08 of this Agreement or Old Dominion Monthly Accredited Firm Capacity if no reserves are required pursuant to Sections 8.07 cr 8.08 of this Agree-ment.

8.04 Purchase of Capacity by Old Dominion from Other Sources. In the event Old Dominion elects to purchase or oth-erwise acquire capacity from sources other than Va wo, pursuant I

l to Section 8.03, where such purchase or acquisition is not jointly planned with Vepco, Vepco's obligation to serve supple-mental demand shall be reduced by that amount of additional ca-pacity from sources other than.Vepco (hereafter " Excluded Sup-plemental Capacity"). At the time Old Dominion gives notice to

, Vepco of a purchase of capacity it shall slso specify the l

l l

l

r expected duration of the purchase. If such Excluded Supplemental Capacity shall become unavailable to Old Dominion for any reason, Old Dominion may replace such capacity from any outside source. If Old Dominion does not obtain such capacity, Vepco shall supply capacity to replace the previously Excluded Supplemental Capacity only on an if, as, and when available bacis, as determined by Vepco, and only at a negotiated price.

When althar Vepco or old Dominion is not able to replace this Excluded Supplemental Capacity or the Parties are unable to agree on a price, Old Dominion must curtail load to restrict its supplemental demand to eliminate the Excluded Supplemental Capacity according to procedures established in advance by the

(

Operating Committee.

8.05 -Limitation on Vepco's obligation to Serve Supplemental Demand and Provide Supplemental Energy. Vepco shall not be required by this Agreement to serve supplemental demand or provide supplemental energy outside the area served by Vepco at retail or wholesale immediately prior to a r.equest for service, except for any minor boundary adjustments and minor reallocations between Old Dominion Members and contiguous systems of the type approved by the Virginia Commission prior to the date of this Agreement.

l l l

If generating capacity or energy should betome inadequate to supply the full needs (after deducting unreplaced Excluded Supplemental Capacity and its associated energy) of both the i

Old Dominion member-consumers and Vepco customers, Old Dominion and Vepco shall share such deficiency on a pro rata basis.

8.06 Reserve Capacity and Energy and Charges Therefor Related to the Facilities. For Old Dominion Monthly Retained Capacity Old Dominion shall carry a percentage of generation reserves equal to the annually projected System Reserve Margin, j Vepco agrees to sell such reserves to Old Dominion and Old Do-minion agrees to purchase such reserves from Vepco at the sys-tem average cost for capacity, after excluding all amounts as-sociated with the Facilities and Nuclear Fuel capacity costs, if any, associated with the racilities, au initially set forth in the rates contained in Appendix G. Reserve energy for the Facilities shall be sold by Vepco and purchased by Old Dominion at the same rates and on the same terms applicable for supple-( mental energy pursuant to Section 8.02. Nothing contained t

herein shall be construed as affecting in any way the right of l

Vepco to unilaterally file with FERC for a change in the rates contained in Appendix G hereto under Section 205 of the Federal Power Act and pursuant to the Commission's Rules and Regula-tions promulgated thereunder. In addition, nothing contained herein shall limit or modify in any respect Old Dominion's G

v , -

, _ _ _ . . . - . , .y -

y__r.,.r --

legal rights to oppose, in whole or in part, Vepco's filing for a change in the rates contained-in Appendix G hereto or to com-plain of the rates in Appendix G pursuant to Section 206 of the Federal Power Act.

8.07 Reserve Capacity and Reserve Capacity Charges for Jointly Planned Generation Resources. For future generation resources jointly planned with Vepco pursuant to Section 3.05, Old Dominion shall at all times carry a percentage of genera-tion reserves equal to the annually projected System Reserve Margin unless the Planning Committee after reviewing the spe-cific engineering characteristics and projected operation of the jointly planned generation resource determines that a dif-ferent level of reserves is appropriate. If Vepco provides the necessary reserves for the jointly planned generation resource to Old Dominion, the Planning Committee shall determine the price of such reserves.

8.08 Reserve' Capacity and Reserve Capacity Charges for Non-Jointly Planned Generation Resources. For future genera-tion resources not jointly planned with Vepco pursuant to Sec-tion 3.05, Old Dominion shall at all times carry a percentage of generation reserves equal to the annually projected System Reserve Margin unless the Planning Committee after review of the specific engineering characteristics and projected operation of the jointly planned generation resource determines

that a different level of reserves is appropriate. Vepco shall not, however, have any obligation to provide such reserve ca-pacity to Old Dominion and Old Dominion shall procure the required reserves from entities other than Vepco or from Vepco if Vepco shall so agree. If Vepco provides the necessary re-serves for a non-jointly planned generation resource to Old Do-minion, the Planning Committee shall determine the price of such reserves.

i 48-

,._ , , _ y .m._ , 1-------e -'--,'- ---- '-*=- "" --'--- - ' ' ' ' ' ' - ~ ' ' ~ ~ ' ' ' ' '~

ARTICLE IX Interconnection Points 9.01 Interconnection Points. Vepco and Old Dominion, during the term of this Agreement, shall remain interconnected.

Unless otherwise mutually agreed upon, Old Dominion or its Mem-bers shall own, operate and maintain all facilities, except interconnection metering, on the Old Dominion side of the Interconnection Points and these facilities shall be operated and maintained in accordance with Prudent Utility Practices.

Unless otherwise mutually agreed upon, Vepco shall own, operate and maintain all facilities on the Vepco side of the Interconnection Points and all interconnection metering no mat-ter where located. These facilities shall be operated and maintained in accordance with Prudent Utility Practices.

9.02 Existing Interconnection Points. The Planning Com-mittee shall maintain a current list identifying and describing .

Interconnection Points in service. All existing Interconnection Points are defined as those points where elec-tric power and energy are transferred on the Closing Date from the Vepco System to facilities owned by Old Dominion or one of its Members.

9.03 Facilities Charges. Old Dominion shall pay all fa-cilities charges related to the facilities listed on Appendix H and any additional excess facilities requested by Old Dominion.

Those charges shall be for facilities in excess of those normally required and shall initially be at the levels chown on Appendix H and shall be changed from time to time pursuant to the provisions of Appendix H.

9.04 Modifications to Interconnection Points. Where-modifications are suggested for Interconnection Points existing on the Closing Date, the Planning Committee shall review the suggested modifications, allocate the costs of the changes be-tween the Parties and, if necessary, establish a new point in the physical arrangement as the Interconnection Point. If the change is mutually agreed upon or if the change is reasonably required in joint planning for the giving or receiving of ade-quate service hereunder, the change will be made with each Party bearing its own costs. Otherwise, the Party requesting the change shall be fully responsible for the change and shall pay all costs incurred as the result of such ~ change. Where an Interconnection Point is discontinued, the costs of removal shall be paid for by the Party initiating the discontinuance.

9.05 Future Interconnection Points. The Planning Com-mittee shall coordinate planning of future Interconnection Points through the following procedure: Old Dominion shall de-termine its needs for future Interconnection Points and shall

! give Vepco as much advance notice of its needs as practicable.

l The Planning Committee shall review the Old Dominion plans for l

( l l

l

reasonableness and consistency with Prudent Utility Practices.

Vepco may propose appropriate modifications to Old Dominion's plans; however, Vepco will not require unreasonable modifica-tions to Old Dominion's plans. It is the intent of the parties that the number, capacity, and location of future Interconnection Points will resulc from a planning process using Prudent Utility Practices and neither Party shall request changes or-additions which would not be in accordance with this

! concept.

In establishing all future Interconnection Points, Old Dominion shall construct and bear the costs of those facilities necessary to effect interconnection at the point where Vepco facilities exist or will exist at the time of the need for the interconnection. Future Interconnection Point.s will be established at 115 kv or higher, except in those cases where the Planning Committee, consistent with Prudent Utility Prac-tices, determines that service at lower voltage levels is ap-propriate and Vepco shall not unreasonably withhold service at such lower voltage levels. The point of interconnection will be defined and established by the Planning Committee so that Vepco will, except as_noted below, provide and bear the costs of those facilities on the supply side of the Interconnection Point, including the necessary switching and protective equip-ment, and Old Dominion will provide and bear the costs of those facilities on the load side of the Interconnection Point,

-including the necessary isolation switching devices and protec-tive equipment, transformers and. lines. Metering equipment

! will normally be owned by Vepco and will be installed on the Old Dominion side of the Interconnection Point.

When the need for the future Interconnection Point de-scribed by Old Dominion could, through Prudent Utility Prac-1 tice, be satisfied through the modification and/or upgrading of l Old Dominion's existing facilities, but Old Dominion still de-sires the future Interconnection Point and Vepco agrees to sup-

. ply it, Old Dominion shall bear the cost of whatever facilities may be required, including those facilities on the supply side of the Interconnection Point.

9.06 Filing Fees. Original filing fees required in im-

plementing this Agreement and any filing fees arising from i

changes in this Agreement will be borne equally by the Parties, unless such fee is required to effectuate a change in rates, in i- .

which case the fee shall be borne by Vepco.

9.07 Characteristics of Electricity. Except as provided l

in Section 9.05, Vepco will furnish at future Interconnection Points three phase, 60 Hertz alternating current electricity at l 115 kV or higher or at the nominal voltage level determined to l -

! be appropriate by the Planning Committee. Vepco will continue l to furnish at all existing Interconnection Points three phase, i

, _ . ...._ , ,. , , . _ , . - . _ . - _ - _ _ _ . - , . - _ , _ _ . , ~ , , _ _ _ - _ . , - - _ , . , , . . . _ . - . . = . - _ . . - , , _ - - , _ - _ , _

60 Hertz alternating current electricity at the Vepco nominal voltage now being furnished as listed in Appendix I. Vepco shall operate its system so that Old Dominion's voltage at each Interconnection Point is within the range Vepco would maintain for its own purpose.

9.08 Unusual Operating Conditions.

(a) Vepco and Old Dominion will separately de-velop load curtailment plans that provide schedules for voltage reductions, voluntary load curtailments and manual load shedding. These plans will provide for sufficient load reduc-tion in case the combined resources of Vepco and Old Dominion are insufficient to meet the combined load. Non-jointly planned generation resources shall be included in the combined resources of the Parties only to the extent determined appro-priate by the Operating Committee. Vepco and Old Dominion will work together to ensure the integrity of the Interconnected Systems, with Vepco charged with the responsibility of ,

initiating and coordinating any load curtailments and the sub-sequent restoration of these loads.

(b) From time to time unusual conditions may exist on Vepco's System or on some other system directly or in-directly connected to the Vepco system which may require par-tial interruption of supply to Vepco's customers and to Old Do-minion. In the event such interruptions become necessary Vepco 1

shall promptly notify Old Dominion by telephone of the need to interrupt and the proposed plan and schedule for such interrup-tions and Old Dominion will cooperate by interrupting load to the extent required and for the same duration as Vepco to com-pensate for the unusual conditions. Old Dominion and Vepco will interrupt load in as nearly as practical the same percent-age. Should Old Dominion willfully fail, .in the absence of good cause, to interrupt its proportionate share of load when Vepco has interrupted its share of load, such failure shall constitute an Event of Default as described in Article XVIII of this Agreement. Vepco chall notify Old Dominion immediately by

, telephone when an interruption is planned to be terminated.

(c) In the event a temporary voltage reduction is

. required because of any condition, Vepco will notify Old Domin-

! ion as far in advance as practicable of its plan to reduce 1

^

voltage and the period such yoitage reduction is believed to be required and Old Dominion will, upon such notification, effect

( a similar true voltage reduction on its system during the same period. Should Old Dominion willfully fail, in the absence of good cause, to reduce voltage for the same period as Vepco re-duces its voltage such failure shall constitute an Event of De-

< fault as described in Article XVIII of this Agreement. Old Do-l minion will be notified immediately when a voltage reduction is l planned to be terminated.

L

9.09 Access at Interconnection Points. Old Dominion and Vepco will have the right of access at all Interconnection Points and at all remote Interconnection Point metering loca-tions at reasonable times for the purposes of reading meters or installing, maintaining, changing or removing any property they own or for any other proper purpose. The handling of tape car-tridges associated with tape metering at Interconnection Points will be done only by the owner of the tape meters.

- 9.10 Notification of System Changes. Old Dominion shall

notify Vepco in advance, and Vepco shall notify Old Dominion in advance, of any changes to be made in their respective systems which will affect the proper coordination of protective devices on the two systems. Old Dominion and Vepco shall each be re-I sponsible for selection, installation, adjustment and setting, and maintenance of their own control and protective equipment.

In no case shall operation of this equipment by either Vepco or j Old Dominion place a burden upon or cause avoidable interrup-l tions to the other's system.

9.11 Metering.

(a) Suitable metering shall be installed to mea-sure all' segments and use pertaining to this Agreement

{ including, but not limited to, Old Dominion's purchases and generation, and Vepco's purchases and generation. The costs of metering shall be included in the rates and charges set forth i

i e

9 q , r-- - -+ e -- nn.,,,a - n,,,,--,--n .

,~---,~g,,-- gra-- , , , , ,,s,-e-,w, e- ,,.,e ,v--,,r,,,,,v,--m,,,,-, - - - - , - , - , , - - - - -

in Appendix B or in Appendix E, as appropriace. Old Dominion shall bear the total costs of any future metering and data ac-quisition equipment at any of its generation facilities and any interconnection metering covered by future contracts Old Domin-ion may make with other entities. Vepco shall own, operate And maintain all metering at existing Interconnection Points and, unless otherwise agreed, at future Interconnegtion Points. All Interconnection Point metering shall use the magnetic tape type meter or whatever other mutually acceptable type meter may be-a come available in the future.

(b) All meters will be sealed and seals will be broken only by the owning Party and only when meters are to be tested or adjusted. In accordance with Prudent Utility Prac-1 tices meters will be tested at suitable intervals and the accu-racy of registration shall be maintained. At the request of 1

either Party a special test of any meter will be performed. All costs of such a test will be paid by the Party requesting the i

test, unless meter inaccuracy as defined in Section 9.11(c) is discovered. Costs then will be borne by the owning Party.

Representatives of Old Dominion and Vepco shall be afforded the l

opportunity to be present at all routine or special tests. Old l

Dominion and Vepco shall have the right to install check me-

tering for any Interconnection Point without charge by the 1 Party owning the metering equipment.

i

, (c) Any metering equipment found to be inaccurate by more than two (2) percent or inoperable will be promptly replaced, repaired or readjusted by the owner of such inaccu-rate metering equipment. Adjustments made for metering inaccu-racy or other meter malfunctions will be made for the period.

the inaccuracy or malfunction is known, or for a mutually agreed upon period, if nch Itnown. If agreement on the period of adjustment cannot be reached, a period of three months from the date of discovery of the inaccuracy or malfunction shall be utilized.

(d) Interconne: tion Point metering will be i installed at the Interconnection Point if practical as deter-mined by the Party owning the metering. Where metering is installed at some other place than the Interconnection Point, adjustments will be made to permit readings to be determined as though they were at the Interconnection Point.

l i

i t

- r -._. m , ___, , _ . _ , , _ , , ,_ _..,____.,___--r .y. ..~,_ - . _ . - - - . _ , , _ . . _ _ _ _ . _

ARTICLE X Billing

' Billing Methods.

.10.01 Billing for all payments due J

under this Agreement shall be in the format provided in Appen-dix J.

10.02 Rendering Bill. Each Party shall render to the other Party monthly a billing statement no later than the twentieth day of the month, transmitted by wire or delivered by l courier, covering the following: (a) all the amounts due for Supplemental Demand and Energy, Reserve capacity and energy, and buy-back of capacity and energy pursuant to Section 7.02 (less the amount excluded pursuant to (c) below) occurring in the preceding month, (b) the estimated amount due for operating costs pursuant to Article XII for the next succeeding month.

When the actual expenditures for. operating costs for that month

{ have been determined by Vepco and recorded on its books of ac-count, an adjustment shall,be made by Vepco to reflect a credit ,

or additional charge to Old Dominion and such credit or addi-tional charge shall appear, with interest at the Regular Inter-est Rate payable to the appropriate Party, on the monthly in-voice next delivered after determination of the actual expendi-tures; and (c) at Vepco's option, estimated amounts pursuant to (b) above may exclude that portion of the aperating costs re-lated to the percentage of Old Dominion's entitlement to 1

1

.--.n -. .-- - - - - - , . . , . , . , -

,,-,--.n --n.. -,-,.n - - - , - . - , , , . , . _ , . . , , , - , , , , . . . , . . - . - -.- ,- ,.,-

capacity and energy being bccught back by Vepco pursuant to Section 7.02. If Vepco does not exercise this option, the Par-ties agree to establish a procedure that will accomplish the same result.

10.03 Payment.

(a) Payment for items under Section 10.02(a) shall be due upon presentation of the bill. If payment is not 1

received within ten (10) days from the date the invoice is transmitted or delivered, interest at the Special Interest Rate will accrue from date of presentation until payment is received. Date of presentation is the day the bill is wired or, if delivered by courier, the date delivered.

(b) Payment for items under Section 10.02(b) shall be due upon presentation. If payment is not received by the fifteenth of the month following presentation of the bill,

, interest at the Special Interect Rate will accrue from date of presentation until payment is received. Date of presentation

) is the day'the bill is wired or, if delivered by courier, the date delivered.

10.04 Methods of Payment. All payments required to be made by either Party under this Agreement in excess of $10,000 shall be paid on or before the due date in immediately avail-able funds by delivery (before 11:00 a.m., Richmond time) of either a Federal Reserve check or evidence of bank wire to the l

other Party's account, at a bank designated by such Party. If any such payment is to be made by bank wire, the Party entitled to the payment shall advise the other Party of the appropriate bank and account number at least one business day before the payment is due. All other payments required to be made under this Agreement may be made by check deposited in the United States mail, first-class postage prepaid, and addressed to Treasurer, Virginia Electric and Power Company, P.O. Box 26666, Richmond, Virginia 23261, if payable to Vepco, and addressed to Executive Vice President, Old Dominion Electric Cooperative, 5601 Chamberlayne Road, Richmond, Virginia 23227, if payable to Old Dominion.

10.05 No Arbitration; Resolution of Disputes. No Party shall have the right to arbitrate any dispute that might arise with respect to this Agreement. Any disagreement between the Parties as to their rights or obligations under this Agreement shall first be addressed by consultation between the Authorized Vepco Representatives as determined in accordance with Section 19.03 of the Purchase, Construction and Ownership Agreement and the Authorized Old Dominion Representatives as determined in f accordance with Section 10.02 of the Purchase, Construction and l

l Ownership Agreement. In the event such representatives are un-able to satisfactorily resolve their disagreement, they shall refer the matter to the Executive Committee created pursuant to I

I I

f l

u _ __ _ _ -_ _ . - - - . - - . - - _ _ ._ _ - - - _ - - .

I l

Section 19.13 of this Agreement. No dispute as to the payment of an invoice rendered by either Party shall permit the other Party to delay payment of the disputed invoice, in full, on its l payment date. If the invoiced Party shall have paid any such disputed invoice, in full, on or before its payment date and if the Authorized Vepco Representatives and the Authorized Old Do-minion Representatives, or the Executive Committee created pur-suant to Section 19.13, or a court of competent jurisdiction, should later determine that a disputed invoice was for an amount in excess of the correct amount due, then the invoicing Party shall be obligated to refund the difference to the in-f voiced Party within ten (10) days of such determination with interest, if any, upon such amount as follows:

' (a) If such difference resulted from a devi-ation from an estimate not caused by error or bad faith, interest shall be payable at the Regular Interest _ Rate; (b) If such difference resulted from an error, interest shall be payable at the Regular Interest Rate; and l

(c) If such difference resulted from bad

! faith, such interest shall be payable at the Spe-l cial Interest Rate.

10.06 Billing Adiustments. Billing errors or adjust-

ments to estimates of $5,000 or more discovered through (i) l resolution of billing disagreements pursuant to Section 10.05, 1

(ii) audit or (iii) normal billing procedures, will be adjusted l'

l l

and interest will accrue at the Regular Interest Rate from the date of payment of the original bill through the date of pay-ment of the adjustment. Adjustments of less than $5,000 will be made, but no interest will accrue. Adjustments including

, interest must be paid in accordance with Section 10.03 hereof.

l l

I t

I _ . _ _ _ . , , . _ ,- , . - - -

ARTICLE XI Maintenance of Power Factor 11.01 Power Factor Limits. Vepco and Old Dominion recognize the need for operating their respective sys-tems during both on-peak and off-peak hours within acceptable power factor limits normally prescribed by Prudent Utility Practices. Power factor limits are established initially in Appendix K and may be modified from time to time by the Operating Committee as system conditions require. Vepco, in each of its load areas, and, subject to the provisions set forth in Section 11.03, Old Dominion, for each of its Member's aggregate loads, will take, or cause to be taken, any steps necessary to maintain power factor within the prescribed lag-ging limits at the time of the Combined System Monthl) Peak De-mand. The Parties also recognize that the application of equipment to maintain or improve power factor during on-peak hours will, or may, cause high voltage conditions or power sys-tem stability problems during off-peak periods. Vepco's power factor program is planned and operated in a manner to avoid these conditions and, subject to the provisions of Section 11.03, Old Dominion acknowledges its responsibility for the l

planning and operation of its and its Members reactive power supply facilities during off-peak hours to avoid undesirable high voltage or stability problems.

l l

11.02 Power Factor Monitoring. The power factor for each of Vepco's load areas and for each of Old Dominion's Mem-

-bers shall be monitored by the operating Committee. Should 5

this monitoring identify any load area or Member not conforming to the power factor criterion during either on-peak or off-peak periods, Vepco and Old Dominion shall initiate steps to correct the deviation. If the deviation stems from conditions on the Vepco system, Vepco will take the steps necessary for correc-tion. If the deviation stems from conditions on the Old Domin-ion system, subject to the provisions of Section 11.03, Old Do-minion or its non-conforming Member or Members will take the steps necessary for correction.

11.03. Old Dominion Option. To the extent Vepco sup-plies Old Dominion Supplemental Demand and Energy, the charges 4

to Old Dominion for such supplemental service will include Old Dominion's appropriate share of the cost to Vepco of reactive power supply facilities. For that part of Old Dominion's load supplied by its own generation resources, however, unless accounted for through the installation by Old Dominion of reactive power supply facilities or through payment to Vepco l for such facilities, Vepco would be uncompensated for supplying i

! Old Dominion's reactive requirements. Accordingly, for that s

part of Old Dominion's load supplied by its own generation re-

, cources, Old Dominion, at its option, will either install, i

I t . .. .- - _ - . . _ . - . - - - . . - - -- - - --

, operate and maintain those reactive power supply facilities required to maintain its or its Members power factor within the prescribed limits set forth in Appendix K, or pay Vepco pursu-ant to Section 11.05 hereof.

Notwithstanding Old Dominion's option under this Section, it is not the intent of the Parties that Vepco shall continue to supply the reactive requirements of Old Dominion when Old Dominion ceases to purchase Old Dominion Monthly Supplemental Demand. Accordingly, at such time Old Dominion's option shall cease and Old Dominion shall thereafter become responsible for the installation of its own reactive power supply facilities.

11.04 Grace Period. To allow Old Dominion or its Mem-bers sufficient time to correct power factor deficiencies in their systems with respect to that part of Old Dominion's load supplied by its own generation resources, Vepco agrees that no payments in compensation for deviation from power factor limi-tations for either on-peak or off-peak periods shall be made by Old Dominion to Vepco for a period of one year beginning with the date on which the deviation from the power factor limita-l tions is identified by the Operating Committee.

11.05 Compensation for Deviations from Power Factor Limits. Subject to the grace period set forth in Section l

11.04, the provisions of Appendix K, and Old Dominion's option established in Section 11.03, for all such deviations from the l .

l l

power factor criterion caused by load supplied by Old Dominion's generation resources, Old Dominion shall pay Vepco a monthly amount determined in accordance with Appendix K of this Agreement unless such payment is waived by Vepco. Vepco shall waive payment of all or any part of any monthly payments required by this Article which may have been caused by an inad-vertent or unavoidable but nonrecurring deviation from the power factor criterion. By waiving payment for any or all of any monthly payment, Vepco does not give up the right to com-pensation under this Article to any past or future payments required by this Article.

11.06 Changes in Charges. Nothing contained herein shall be construed as affecting in any way the right of Vepco to uni-laterally file with FERC for a change in the charges contained in Appendix K under Section 205 of the Federal Power Act and pursuant to the Commission Rules and Regulations promulgated thereunder. In addition, nothing contained herein shall limit or modify in any respect Old' Dominion's legal rights to oppose, in whole or in part, Vepco's filing for a change in these rates contained in Appendix K hereto or to complain of the rates in Appendix K pursuant to Section 206 of the Federal Power Act.

ARTICLE XII Operating Costs 12.01 Operating Costs. During the term of this Agree-ment, Old Dominion shall pay to Vepco its pro rata share of the costs of operating and maintaining the Facilities in accordance with Appendix L hereto. For purposes of this Section, Old Do-minion's pro rata share shall be 11.6% of North Anna Unit 1, 11.6% of North Anna Unit 2, and 11.6% of Common Facilities and Operating Inventory and Old Dominion's share of Major Spare Parte. and Support Facilities determined from time to time as provided in Sections 1.18 and 1.37, respectively, of the Pur-chase, Construction and Ownership Agreement. These pro rata shares shall be subject to change from time to time in accor-dance with Sections 15.03, 16.01 and 16.02 of the Purchase, Construction and Ownership Agreement. Old Dominion also will pay the expenses associated with nuclear fuel as provided in the Nuclear Fuel Agreement.

12.02 Payment for Other Costs. Old Dominion agrees to pay its proper portion, as determined in Section 12.01, of those costs that are not otherwise provided for herein if such l costs are incurred in the operation or maintenance of the Fa-cilities.

1 i-

ARTICLE XIII Accounting Matters and Access to Books and Records 13.01 Responsibility and Method of Accounting. All ac-counting related to the tre.nsactions contemplated by this Agreement shall utili e the accrual method of accounting and shall be in accordance with Generally Accepted Accounting Prin-ciples, FERC's Uniform System of Accounts or as prescribed by other regulatory agencies having jurisdiction, all as in effect from time to time.

13.02 Right to Inspect Records, Etc.

(a) During normal business hours and subject to conditions consistent with the conduct by Vepco of its regulcr business a5 fairs and responsibilities, Vepco will provide Old Dominion, Old Dominion's Authori=ied Representative (s) or any

, auditor utilized by Old Dominion reasonably acceptable to Vepco or any nationally recognized auditing firm retained by Old Do-minion, access to Vepco's books, records, and other documents, directly related to the performance of Vepco's obligations

~

under this Agreement (but excluding internal memoranda, records and documents relating to such matters and minutes of the Board of Directors and committees thereof) and, upon request, copies thereof, which set forth (i) costs applicable to the construc-tion, operation, maintenance and retirement of the Facilities to the extent necessary to enable Old Dominion to verify the l

l costs for which Old Dominion is billed pursuant to the provisions of this Agreement, and (ii) matters relating to the design, construction, operation, and retirement of the Facili-ties in proceedings before any regulatory body or governmental agency having jurisdiction. Old Dominion will bear the cost of any copying, review or audit of such books and records. Not-withstanding the foregoing, however, Vepco shall not be required to make available to Old Dominion any reports and in-formation relating to personnel practices, staffing or labor relations.

(b) During normal business hours and subject to conditions consistent with the conduct by Old Dominion of its regular business affairs and responsibilities, Old Dominion will provide Vepco, Vepco's Authorized Representative (s), or any auditor utilized by Vepco reasonably acceptable to Old Do-minion or any nationally recognized auditing firm r'tained e by Vepco, access to Old Dominion's books, records, and other docu-ments (but excluding internal memoranda, records and documents relating to such matters and minutes of the Board of Directors and committees thereof), and, upon request, copies thereof, which relate to this Agreement. Vepco will bear the cost of any copying, review or audit of such books and records. Not-withstanding the foregoing, however, Old Dominion shall not be required to make available to Vepco any reports and information relating to personnel practices, staffing or labor relations.

t l

I i _ _ _ _ _ _

13.03 Confidentiality. During the term of this Agree-ment, it may become necessary or desirable, from time to time, for one Party to provide to the other Party information which is either confidential or proprietary. The Party desiring to protect any such information (the labelling Party) may label-such information as either confidential or proprietary and thereafter the other Party will not reproduce, copy, use or disclose (except when required by governmental authorities) any such information in whole or in part for any purpose without the written consent of the labelling Party. In disclosing con-fidential or proprietary information to governmental authori-ties, the disclosing Party shall cooperate with the labelling Party in minimizing the amount of such information furnished.

At the specific request of the labelling Party, the other Party will endeavor to secure the agreement of such governmental au-thorities to maintain specified~ portions of such information in confidence.

i l

I 1

i l

l ARTICLE XIV Liability, Service Interruptions and Force Majeure 14.01 Liability.

(a) In providing the services called for by this i Agreement, Vepco shall use reasonable diligence at all times to provide reasonably adequate service. Vepco, however, does not guarantee continuous service. The Parties acknowledge that, at the request of and for the convenience of Old Dominion, Vepco is to have full responsibility for the maintenance and operation of the Facilities. The judgment of Vepco personnel shall be final in decisions concerning operation and mainte-nance of the Facilities. With respect to claims of third par-ties, Old Dominion agrees that Vepco does not by this Agreement assume any risks or liabilities with respect.to the operation and maintenance of Old Dominion's share in the Facilities, and that the amounts payable to Vepco for its performance under this Agreement are determined on the basis that Vepco does not

~

assume such risks or liabilities. Vepco's obligation to Old Dominion with respect to the operation and maintenance of the Facilities shall be as set forth in the Basic Agreement.

(b) In addition to all other limitations on lia-bility contained in this Agreement, neither Party hereto shall be liable to the other Party to this Agreement for any damage or loss resulting from the interrupt;cn, prevention, suspension or.. failure of service caused by:

(1) Force majeure, as defined in Section 14.03 below; and/or (ii) An emergency action due to an adverse condition or disturbance on a Party's system, or on any other system which re-quires automatic or manual interruption of the supply of electricity to some customers or areas in order to limit,the extent of, or damage caused by, the ad-verse condition or distur-bance, or to prevent damage to. generating or trans-mission facilities, or to expedite res-toration of service, or to effect a re-duction in service to compensate for an emergency condition on an interconne ced system; and/or (iii) The making of necessary inspections of, adjustments to, changes in, or repairs to a Party's lines, substations or other facilities and in cases where the con-tinuation of service would endanger per-sons or property.

(c) With respect to claims relating to the quali-ty, continuity, reliability or price of electric service, (i) Vepco shall not be liable to Old Domin-ion Members or the member-consumers of Old Dominion Members or any other per-sons or entities claiming through or ,

against Old Dominion or Old Dominion Members for any expenses, damages, in-juries or loss arising out of or result-ing from the maintenance or operation of the Facilities, and Old Dominion shall indemnify Vepco against such liability; and (ii) Old Dominion shall not be liabic to the retail or wholesale customers of Vepco or any other persons or entities claiming through or against Vepco for any expenses, damages, injuries or loss arising out of or resulting from the

1

- l operation or maintenance of the Facilities, and Vepco shall indemnify Old Dominion against such liabilities.

With respect to all other claims, the Parties will share all expenses and liabilities in the same proportion that they share evnership in the Facilities.

J 14.02 Responsibility on Either Side of Interconnection Point. Neither Party shall be responsible for the transmis-4

,sion, control, use or application of electric power provided under this Agreement on the other Party's side of any  !

Interconnection Point. Electricity is supplied by Vepco to Old Dominion upon the express condition that after it passes the Interconnection Point it becomes the property of Old Dominion; and neither Party, unless and except to the extent that such results from the negligence or misuse of the property on the part~of its employees or agents, subject to the limitations of Section 14.01, will be. liable for los: or damage to any persons or property whatsoever, resulting directly or indirectly from the use, misuse, or presence of the said electricity, on the other Party's side of the Interconnection Point or for any loss I or damage resulting from the presence, character, or condition of the wires or equipment of the other Party, nor shall it be responsible for the inspection or repair of such wires or equipment.

14.03 Force Majeure. Vepco and Old Dominion shall not be liable or responsible for any delay in the performance of, or the abilit'y to perform, any duties or obligations required by this Agreement when such delay in performance or inability to perform results from a Force Majeure occurrence, except that the obligation to pay money in a timely manner is absolute and shall not be subject to the Force Majeure provisions. Force Majeure as used herein shall mean without limitation, the fol-lowing: Acts of God; strikes, lockouts or other industrial disturbances; acts of public enemies; orders, or absence of necessary orders and permits of any kind which have been prop-erly applied for, from the Government of the United States or from any State or Territory, or any of their departments, agen-cies or officials, or from any civil or military authority; ex-traordinary delay in transportation; inability to transport, store or reprocess spent nuclear fuel; unforeseen soil condi-tions; equipment, material, supplies, labor or machinery short-ages; epidemics; landslides; lightning; earthquakes; fire; hur-ricanes; tornadoes; storms; floods; washouts; drought; war; civil disturbances; explosions; breakage or accident to ma-chinery, generation, transmisson and/or distribution facili-ties, pipes or canals; partial or entire failure of utilities; breach of contract by any supplier, contractor, subcontractor, laborer or materialman; sabotage; injunction; blight; famine;

,n. , - , - - -

blockade; quarantine; or any other similar cause or event not reasonably within the control of Vepco and/or Old Dominion.

14.04 Remedy. A Party suffering an occurrence of Force Majeurs shall remedy with all reasonable dispatch the cause or causes preventing such Party from carrying out its duties and obligations as required in this Agreement; provided, that the settlement of strikes, lockouts and other industrial distur-bances affecting Vepco or Old Dominion facilities shall be en-tirely within the discretion of that Party, and it shall not be required to make settlement of strikes, lockouts, or other in-dustrial disturbances by acceding to the demands of the opposing party or parties when such course is unfavorable in the judgment of such employer.

<~.--e a .- - - . . _ . . , . . ,.n- - . , , . , - -g-+-+ ,

ARTICLE XV Representations and Warranties 15.01 Representations and Warranties of Vepco. Vepco represents and warrants as follows:

(a) Vepco is a corporation duly incorporated and validly existing, in good standing, under the laws of Virginia, is duly qualified and authorized to do business and is in good standing in each jurisdiction where the character of its properties or the nature of its actions makes such qualifica-tion necessary, and has the corporate power to carry on its business as now being conducted and possesses all Federal and State authority and local franchises necessary for the mainte-nance and operation of its properties and business with such minor exceptions as will not materially interfere with the operation and maintenance of the Facilities.

(b) Consummation of the transactions hereby con-templated and performance of this Agreement by Vepco will not result in violation of any laws, ordinance or governmental j rules to which Vepco is subject. Vepco either has obtained, l

or at the Closing Date shall have obtained, all necessary gov-i ernmental approvals and consents in connection with the consum-1 mation by Vepco of the transactions hereby contemplated and the l

performance by it of this Agreement.

i

(c) The consummation of the transactions hereby contemplated and the performance by Vepco of this Agreement will not result in the breach of, 'or constitute a default under, the Articles of Incorporation or By-Laws of Vepco or any indenture (including the Indenture of Mortgage), mortgage, deed of trust, bank loan or credit agreement, or other agreement or instrument to which Vepco is a party or by which Vopco or its proparties may be bound or affected, or result in the creation of any lien, charge, security interest or encumbrance upon any property of Vepco, and Vepco is not in default under any term of any such agreement or instrument.

(d) Vepco is neither a " registered holding compa-ny" nor a " subsidiary company" of a registered holding company within the meaning of the Public Utility Holding Company Act of 1935; and Vepco is not, and is not directly or indirectly controlled by, or acting on behalf of any person w'hich is, an

" investment company', within the meaning of the Investment Com-pany Act of 1940, as amended.

(e) On the date hereof there exists, as to Vepco, no Ever' of Default or event or condition which, with the giv-ing of notice or the lapse of time or both, would constitute an Event of Default.

l 15.02 Representations and Warranties of old Dominion.

Old Dominion represents and warrants as follows:

l

(a) Old Dominion is a generation and transmission cooperative duly incorporated and validly existing, in good standing, under the laws of Virginia, is duly qualified and au-thorized to do business and is in good standing in each juris-diction where the character of its properties or the nature of its actions makes such qualification necessary, and has the corporate power to carry on its business as now being conducted and possesses substantially all Federal and State authority and local franchises necessary for the maintenance, operation of its properties and business with such minor exceptions as will not materially interfere with the maintenance and operation of the Facilities.

(b) Consummation of the transactions hereby con-templated and performance of this Agreement by Old Dominion t

will not result in violation of any laws, ordinances, or gov-ernmental rules to which it is subject. Cid Dominion either has obtained, or at the Closing Date shall have obtained, all necessary governmental approvals and consents, including the approval of REA, in connection with the consummation by Old Do-minion of the transactions hereby contemplated and the perfor-mance by .t of this Agreement.

t (c) The consummation of the transactions hereby contemplated and the performance by Old Dominion of the Basic Agreements will not result in the breach of, or constitute a l

l

default under, the Articles of Incorporation or By-Laws of Old Dominion or any indenture, mortgage, deed of trust, bank loan or credit agreement, or other agreement or instrument to which old Dominion is a party or by which old Dominion or its properties may be bound or affected, or result in the creation of any lien, charge, security interest or encumbrance upon any property of Old Dominien (other than any lien, charge, security interest or encumbrance created by Old Dominion ,as a result of its purchase of Old Dominion's Percentage Ownership Interest at Closing and other than Permitted Encumbrances), and Old Domin-ion is not in default under any term of any such agreement or instrument.

(d) On the date hereof there exists, as to Old Dominion, no Event of Default or evenc or condition which, with the giving of notice or the lapse of time or both, would con-stitute an Event of Default.

(e) Each of the Old Dominion Members has entered into and will be bound by the Wholesale Power Contracts on Closing Date.

(f) Old Dominion is authorized to act solely for each and all of the Old Dominion Members in all communications, transactions and relationships with Vepco pursuant to this Agreement.

15.03 Conditions Precedent to Closing. On or prior to Closing, each of the following conditions shall have been satisfied: (a) this Agreement shall have been accepted for filing by the FERC, (b) all representations and warranties in Sections 15.01 and 15.02 hereof shall be true with the same ef-feet as though such representations and warranties had been made on and as of such date, and (c) each Party shall have performed all agreements on its part required to be performed on or prior to such date.

15.04 Survival. All representations and warranties made by the Parties in or under this Agreement (and all statements contained in any certificate or other instrument delivered by either Party pursuant to this Agreement shall be deemed to con-stitute such representations and warranties made by such Party) shall survive the Closing.

l

ARTICLE XVI Term of Agreement This Agreement shall become effective on the Closing Date. Unless earlier terminated pursuant to the Provisions of Article XVIII, this Agreement shall terminate upon the earlier of (1) the date on which the last of the Facilities is retired or (2) upon the date upon which Old Dominion's Percentage Own-erchip Interest in the Facilities and Nuclear Fuel is reduced to zero. Prior to such termination, Vepco shall have filed with FERC a rate schedule to provide for continuing servf.ce to Old Lominion.or its Members equal to:

(i) the amount of Supplemental Energy and Demand being purchased by Old Dominion immediately prior to terminat: .n, plus (ii) the amount, if any, of Old Dominion's Percentage Ownership Interest reacquired by Vepco at the termination of this Agreement.

ARTICLE XVII Filing with FERC This Agreement shall be filed with FERC, with the request that it become effective on the Closing Date. Old Dominion will join in Vepco's request that this Agreement and the ini-tial rates contained herein be accepted for filing with a sus-pension of no longer than one day and will support the other provisions of this Agreement.

l I

l i

ARTICLE XVIII Default, 18.01 Events of Default. Each of the following shall be

" Events of Default" under this Agreement:

(a) The failure of either Party to make any pay-ment then due to the other Party as required by this Agreement within 30 days of the date when such payment became due and payable; provided, however, that no Party shall be in default for nonpayment of any amount due and payable hereunder to the other Party that can be offset within 30 dayo after the date on which such amount became due and payable.

(b) Willful failure by any Party to perform any other obligation to the other Party, other than obligations for the payment of money, provided that the defaulting party shall have been given not less than 60 days' notice of such willful failure by the non-defaulting Party and such defaulting Party shall have failed to correct such default or shall have failed to use its reasonable best efforts to correct such default.

(c) Any of the following acts by any Party hereto:

(i) The insolvency or bankruptcy of a Party or its inability or admission in writing of its inability to pay its debts as they mature, or the making of a general assignment for the benefit of, or entry into any composition or arrangement

with, its creditors other than old l

l l

Dominion's or Vepco's mortgagee, as the case may be; or i

(ii) The application for, or consent (by ad-mission of material allegations of a pe-tition or otherwise) to, the appointment of a receiver, trustee or liquidator for any Party or for all or substantially all of its assets, or its authoriza9.on

of such application or consent, or the commencement of any proceedings seeking -

such appointment against it without such authorization, consent or application, which proceedings continue undismissed or unstayed for a period of 60 days; or

, (iii) The authorization or filing by any Party of a voluntary petition in bankruptcy or i

application for or consent (by admission of material allegations of a petition or i otherwise) to the application of any bankruptcy, reorganization, readjustment '

of debt, insolvency, dissolution, liqui-dation or other similar law of any ju-risdiction or the institution of such proceedings against any Party without such authorization, application or con-sent, which proceedings remain undismissed or unstayed for 60 days or which result in adjudication of bank-ruptcy or insolvency within such time.

18.02 Vepco's Rights on Default of Old Dominion. When-ever any Event of Default by Old Dominion shall" have occurred and Vepco intends to require that the default be remedied, Vepco shall give Old Dominion written notice to remedy the de-fault. If the default shall not have been fully cured within 30 days from the date of the notice, Vepco shall have the rights set forth herein, in addition to all other rights it may have at law or in equity. .

l

- 84-l l

l 1

s s '~- -,-m -- + - - m -re, ,..---,y,m,,,e,,--,y- -_.--wm,. -,-,,+mg ,.,ny,,,.-_.,.,---ww-,-

(a) Where the default is a failure to pay money when due:

(i) Subject to the limitations contained in the Federal Power Act or regulations duly promulgated thereunder, Vepco may, 30 days after delivery to Old Dominion M the Old Dominion Members of written notice of termination, terminate all service under this Agreement. Notwith-standing such termination, Vepco shall be authorized to continue to operate, maintain and fuel the Facilities and to schedule and dispatch the capacity and energy from such Facilities. In the event this provision is invoked Vepco shall maintain an accurate record of all the benefits, including but not limited to the capacity and energy fror Old Do-minion's Percentage Ownership Interest in the Facilities, and costs of such continued operation, maintenance and fu-eling to provide for a reasonable set-tiement following removal of the de-fault.

(ii) Failure of Old Dominion to make any pay-ment on the date required under this Agreement shall obligate Old Dominion to pay to Vepco (a) the unpaid amount, (b) interest on the unpaid amount at the Special Interest Rate from the date such payment was due until the amount is paid and (c) the reasonable expenses incurred by Vepco in collecting the unpaid amount.

(iii) Where a default under Article XV of the Purchase, Construction and Owner-7 ship Agreement shall have otherwise per-I mitted Vepco to purchase all or a por-tion of Old Dominion's Percentage Owner-ship Interest in the Facilities (as those terms are defined in the Purchase, Construction and Ownership Agreement) any amount in default hereunder shall be offset acainst the purchase price to be paid to Old Dominion.

(b) Where the default is the willful failure by Old Dominion to perform an obligation hereunder other than the obligation to pay money when due, Vepco may take any lawful ac-tion that will remedy the default or mitigate its effects, and Old Dominion shall, upon demand by Vepco, pay reasonable losses or damages incurred by Vepco as a direct and proximate result of the default and all expenses incurred by Vepco in remedying the default or mitigating its effects, together with interest at the Special Interest Rate on that amount until the total amount is paid. A failure by old Dominion to make payment hereunder shall constitute a default under Sectiori 18.Ol(a) and give rise to the remedies available under Section 18.02(a).

(c) Where the default is any of the acts set forth in Section 18.01(c), Vepco shall have the right to take any lawful action, including termination of this Agreement, that Vepco determines to be necessary to minimize its losses or enhance its prospects of recovery of amounts due and to become due to it.

18.03 Old Dominion's Riahts on Default of Vepco. When-ever any Event of Default by Vepco shall have occurred and Old Dominion intends to require that the default be remedied, Old Dominion shall give Vepco written notice to remedy the default.

If the default shall not have been fully cured within 30 days from the date of the notice, Old Dominion shall have the rights

l set forth herein, in addition to all other rights it may have at law or in equity.

(a) Where the default is a failure to pay money when due, Old Dominion shall have the right to withhold from Vepco payment of Old Dominion's obligatione hereunder to the extent of the amount in default plus interest at the Special Interest Rate thereon until the amount is paid.

(b) Where the default is the willful failure by Vepco to perform an obligation hereunder other than the obliga-tion to pay money when due, Old Dominion may take any lawful action that will remedy the default or mitigate its effects, and Vepco shall, upon demand by Old Dominion, pay reasonable losses or damages incurred by Old Dominion as a direct and proximate result of the default and all expenses incurred by Old Dominion in remedying the default or mitigating its effects, together with interest at the Special Interest Rate on that amount until the total amount is paid. A failure by Vepco to make payment hereunder shall constitute a default under Sec-tion 18.Ol(a) and give rise to the remedies available under Section 18.03(a).

(c) Where the default is any of the acts set forth in Section 18.Ol(c), Old Dominion shall have the right to take any lawful action, including termination of this Agree-ment, that Old Dominion determines to be necessary to minimize

, . . . _ . . , .- , , , _ . - , , , ~ . . . . , - . . _ _ _ . .

m.,_m _, _ _ _ _._ ,.. , . _ . ,

its losses or enhance its prospects of recovery of amounts due i and to become due to it.

18.04 Disputes Concerning Default. In the event that any Party shall dispute an asserted default by it, such Party shall pay the disputed payment or perform the disputed obliga-tions, but may do so under protest. The protest shall be in writing, shall precede or accompany the disputed payment or performance of the disputed obligations, shall specify the rea-sons upon which the protest is based and shall be delivered to the other Party hereunder. In the event it is determined that the protesting Party is entitled to a refund of all or any por-tion of a disputed payment or payments, or is entitled to rein-bursement of the cost of performing a disputed obligation theretofore made or performed, then the protesting Party shall be reimbursed such amount with interest at the Regular Interest Rate for the period involved.

18.05 Additional Obligations. With respect to any Party as to which an Event of Default has occurred, such Party shall use its best efforts to take any and all such further actions and shall execute and file, where appropriate, any and all such  ;

further legal documents and papers as may be reasonable under the circumstances in order to facilitate the carrying out of this Agreement or otherwise effectuating its purpose, including but not limited to action to seek any required governmental or 1

regulatory approval and to obtain any other required consent, release, amendment or other similar document.

18.06 Injunctive Relief. The Parties hereto agree and i

ecknowledge that the failure of a Party to perform any of its obligations under this Agreement, including tha execution of legal documents which may be reasonably requested as set forth in this Article XVIII, would cause irreparable injury to the other Party and that the remedy at law for any violations or threatened violation thereof would be inadequate, and agree that the other Party shall be entitled to a temporary or perma-nent injunction or other equitable relief specifically to en-force such obligation without the necessity of proving the in-adequacy of its legal remedies.

l 18.07 No Remedy Exclusive. No remedy conferred upon or reserved to ths Parties hereto in this Article XVIII is intend-ed to be exclusive of any other remedy or remedies available hereunder or now or hereafter existing at law, in equity, or by statute or otherwise, but each and every such remedy shall be cumulative and shall be in addition to every other such remedy.

The pursuit by any Party of any specific remedy shall not be deemed to be an election of that remedy to the exclusion of any other or others, whether provided hereunder or by law, equity or statute.

18.08 Agreement to Pay All Costs to Cure Default.

(a) A late payment charge during periods of de-fault shall accrue on any amount in default at an annual rate equal to that of the Special Interest Rate.

(b) If an Event of Default should occur and a Party not in default should employ attorneys or incur other ex-penses for the collection of any payment or the enforcement of performance or observation of any condition or obligation on the part of a defaulting Party or for the exercise of any other remedy hereunder, the defaulting Party agrees that it will on demand therefore reimburse the other Party for its reasonable expenses of such attorneys and such other expenses incurred.

No default shall be deemed cured until all costs payable under this Article, including any attorneys' fees incurred by the Party not in default, anc; payments pursuant to this Agreement shall have been paid or reimbursed.

18.09 General Covenant by the Parties. Each Party hereto covenants and agrees that if any event shall occur or condition exist which constitutes, or which after notice, lapse of time or both, would constitute an Event of Default on its part pursuant to this Article, it shall immediately notify the other Party thereof, specifying the nature thereof and any ac-tion taken or proposed to be taken with respect thereto.

ARTICLE XIX Miscellaneous 19.01 No Delay. No disagreement or dispute of any kind between the Parties to this Agreement or between a Party and any other entity, concerning any matter, including, without limitation, the amount of any payment due from said Party or the correctness of any billing made to the Party, shall permit either Party to delay or withhold any payment or the perfor-mance of any other obligation pursuant to this Agreement. Each Party shall promptly and diligently undertake to resolve such disagreement or dispute without undue delay and in good faith.

19.02 Further Documentation. From time to time after the execution of this Agreement, the Parties hereto shall, within their legal authority, execute other documents as may be necessary, helpful or appropriate to carry out the terms of this Agreement.

19.03 Notice. Any notice, request, consent or other communication permitted or required by this Agreement (other than payments as provided in Section 10.04) shall be in writing and shall be deemed given when delivered by hand or (unless otherwise required by the terms of this Agreement) when deposited in the United Etates Mail, first class, postage pre-paid, and if to Vepco, addressed to:

Senior Vice President - Power Operations Virginia Electric and Power Company P.O. Box 26666 Richmond, Virginia 23261 and if to Old Dominion, addressed to:

Executive Vice President Old Dominion Electric Cooperative 5601 Chamberlayne Road Richmond, Virginia 23227 unless a different officer or address shall have been desig-i nated by the respective Party by notice in writing sent to the other Party hereto.

19.04 Headings Not to Affect Meaning. The descriptive headings of the various articles and sections of this Agreement have been inserted for convenience of reference only and shall in no way modify or restrict any of the terms and provisions hereof.

19.05 No Association, T ru st , Joint Venture or Partnership; Tax Matters. Notwithstanding any provision of this Agreement, the Parties do not intend to create hereby any association, trust, joint venture or partnership under the law of Virginia, although the Parties acknowledge that the owner-ship and operation of the Facilities may constitute a partner-ship for tax purposes. If it should appear that one or more changes to this Agreement would be required in order to avoid the creation or terminate the existence of any such entity, the Parties agree to negotiate promptly and in good faith with

respect to such changes. Vepco and Old Dominion hereby agree that they will both elect to exclude the arrangement created by this Agreement from the application of Subchapter K of the In-ternal Revenue Code of 1954, as amended, and execute all docu-ments required by either Party to effect that result.

19.06 Successors and Assigns. This Agreement shall be binding upon, and shall inure to the benefit of Vepco and Old Dominion, and their respective successors and assigns, provided that no succession to or assignment of any rights or obliga-tions created hereunder, other than an assignment or transfer to the U.S. Government or any agency thereof, the National Rural Utilities Cooperative Finance Corporation, or any other domestic financing institution, in each instance solely as se-curity for loans or advances, shall take place without the prior written consent of Vepco.

19.07 Counte rparts . This Agreement may be executed si-multaneously in two or more counterparts, each of which shall l

be deemed an original but all of which together shall consti-tute one and the same instrument.

19.08 Severability. In the event any of the terms, cov-enants or conditions of this Agreement or amendments thereof or the application of any such term, covenant or condition or amendment thereof shall be held invalid as to a Party or cir-cumstance by any court or governmental agency having

- , , ,- , - , . , , .------- ,- m.

. + . . - . . , ,

jurisdiction, all of the other terms, covenants and conditions of this Agreement and unendments thereof shall not be affected thereby and shall remain in full force and effect.

19.09 Applicable Law. This Agreement is made under and shall be governed by the laws of the Commonwealth of Virginia.

19.10 No Waiver. The failure of either Party to enforce at any time any of the provisions of this Agreement or to re-quire at any time performance by the other Party of any of the provisions hereof, shall in no way be construed to be a waiver of such provisions, nor in any way to affect the validity of this Agreement or any part hereof or the right of such Party thereafter to enforce each and every such provision.

19.11 Computation of Time. In computing any period of time prescribed or allowed under this Agreement, the day on which the act or event occurs after which the designated period of time 'begins to run shall not be included. The last day of the period so computed shall be included if it is a business day; if it is not a business day, the period shall run until the end of the next day which is a business day.

19.12 Survivorship of Obligations. The termination of this Agreement shall not discharge either Party hereto from any obligation it owes to the other Party under this Agreement by reason of any transaction, loss, cost, damage, expense or lia-bility which shall occur or arise (or the circumstances, events

or basis of which shall occur or arise) prior to such termination. It is the intent of the Parties hereby that any such obligation owed (whether the same shall be known or unknown at the termination of this Agreement or whether the circumstances, events, or basis of the same shall ce known or unknown at the termination of this Agreement) shall survive the termination of this Agreement.

19.13 Executive Committee. An Executive Committee, con-sisting of the Chief Executive Officer and the Chief Operating Officer of Vepco, or their designees, and the President of Old Dominion, or his designee, shall meet from time to time for the purpose of resolving disputes arising from the activities of the Operating and Planning Committees established pursuant to Sections 2.01 and 3.01, respectively, of this Agreement and for the purpose of resolving disputes arising under the Purchase, Construction and Ownership Agreement pursuant to the procedures established by Section 20.03 of,the Purchase, Construction and Ownership Agreement.

19.14 Documents Superseded. The Parties agree that upon the effective date of this Agreement the Contracts for the Pur-chase of Electricity for Resale by Rural Electric Cooperative between Vepco and each of the Old Dominion Members shall be su-perseded. These Contracts are listed in Appendix M. Nothing herein shall affect the Temporary Construction Power Agreement

Between Virginia Electric and Power Company and B-A-R-C Electric Cooperative, dated April 6, 1977.

19.15 Entire Agreement. This Agreement, the Purchase, Ccnstruction and Ownership Agreement and the Nuclear Fuel Agreement together with appendices and exhibits incorporated by reference, shall constitute the entire understanding between the Parties hereto, pertaining to the subject matter contained herein. Neither Party hereto has relied, nor will rely, upon any oral or written representation or oral or written informa-tion made or given to such Party by the other Party hereto or any representative of or anyone on the behalf of the other Party hereto.

19.16 Non-Exclusive Agreement. Subject to the limita-tions in this Agreement, Vepco and Old Dominion shall have the right at all times to execute interconneceian agreements with any other persons on the same or different terms and conditions as those stated herein, but no such other agreements shall di-l minish any rights of the other Party hereunder.

19.17 Relationship of the Parties. The duties, obliga-tions, and liabilities of the Parties herein are intended to be several and not joint or collective. The Parties shall be in-dividually responsible for their own obligations as provided herein. Neither of the Parties shall have the right or power to bind the other Party except as expressly provided in this Agreement.

19.18 Singular and Plural . Throughout this Agreement, whenever any word in the singular number is used, it should in-clude the plural unless the context otherwise requires; and whenever the plural number is used, it shall include the singu-lar, unless the context otherwise requires.

I\19.19 Equal Opportunity. During the performance of those parts of this Agreement relating to the construction by Vepco of any additions, bettermants, improvements or replace-ments to the Facilities, Old Dominion and Vepco agree as fol-lows:

(a) The parties will not discriminate against any l l

employee or applicant for employment because of race, color, religion, sex, age or national origin. The Parties will take affirmative action to ensure that applicants are employed, and that employees are treated during employment without regard to their race, color, religion, sex, or national origin. Such ac-tion sha31 include, but not be limited to, the following: em-plcyment, upgrading, demotion or transfer; recruitment or re-cruitment advertising; layoff or termination; rates of pay or other forms of compensation; and selection for training, including apprenticeship. The Parties agree to post in con-spicuous places, available to employees and applicants for em-ployment, notices to be provided setting forth the provisions of this Equal Opportunity Clause.

(b) The Parties will, in all solicitations or ad-vertisements for employees placed by or on behalf of either party, state that all qualified applicants will receive consid-eration for employment without regard to race, color, sex, or naticnal origin.

(c) The Parties will send to each labor union or representative of workers with which it has a collective bar-gaining agreement or other contract or understanding, a notice 4

to be provided advising the said labor union or workers' repre-sentatives of the Parties commitments under this Section, and shall post copies of the notice in conspicuous places available to employees and applicants for employment.

(d) The Parties will comply with all provisions of Executive Order 11246, dated September 24, 1965, and of the rules, regulations and relevant order of the Secretary of Labor.

(e) The Parties will furnish all information and j reports required by Executive Order 11246, dated September 24, l 1965, and by rules, regulations and relevant orders of the Sec-retary of Labor. or pursuant thereto, and will permit access to their books, records and accounts by the administering agency and the Secretary of Labor for purposes of investigation to as-certain compliance with such rules, regulations and orders.

-1

~

l l

(f) In the event of either Party's noncompliance with the nondiscrimination clauses of this Agreement or with any,of the said rules, regulations or orders, the Parties may be declared

.e ineligible for further Government procedures autho-rized'in Executive Order 11246, dated September 24, 1965, and

- such other sanctions may be imposed and remedies invoked as

~

provided in said Executive Order or by rule, regulation or order of the Secretary of Labor, or as otherwise provided by law.

(g) The Parties agree that, unless exempted by the rules, regulations or orders of the Secretary of Labor is-sued pursuant to Section 204 of Executive Order 11246, dated September 24, 1965, all subcontracts and purchase orders will cite that such contract or purchase orders are subject to Exec-utive Order 11246 and such provisions will be binding upon each subcontractor or.. vendor. The Parties will take such action r L with respect to any subcontract or purchase order as the admin- I istering agency may direct as a means of enforcing such provi-sions, including sanctions for noncompliance; provided, howev-er, that in the event either Party becomes involved in, or is threatened with, litigation with a subcontractor or vendor as a result of such direction by the administering agency, that Party may request thw United States to enter into such litiga-tion to protect the interests of the Unite d States.

99

.- -_ - - , . _ , - - _ . _ . .c..,.,,, _w,.m..., y. -.~.,.7 , , , . - , , . , - - - , - . . - , , ,,._.,# . - ,--~,y-~,,-

r 19.20 Good Faith. The Parties hereto expressly agree that every obligation undertaken in this Agreement will be performed in good faith.

, 19.21 Merger of Documents. All understandings and agreements, written or oral, among the Parties prior to October 17, 1983, with respect to the matters herein contained, including the Principles for Agreement, dated October 20, 1981, and the I & O Agreement, between Vepco and Old Dominion, exe-cuted on December 28, 1982 and the I & O Agreement dated as of ,

December 28; 1982, but executed on March 4, 1983 (the " Original i

I & O Agreements") have been superceded in all respects by this  !

Agreement, dated as of December 28, 1982, but amended and restated on October 17, 1983 and all such understandings and agreements prior to October 17,* 1983, including the Principles ]

l for Agreement and the Original I & O Agreements, are null and void and of no effect whatsoever. '

19.22 Environment. The provisions of Section 20.17 of the Purchase Agreement are incorporated herein by reference and shall apply as if set forth herein in full.

19.23 Kick-backs. The provisions of Section 20.18 of the Purchase Agreement are incorporated herein by reference and shall apply as if set iveth herein in full.

19.24 Nonsegregated Facilities. The provisions of Sec-tion 20.19 of the Purchase Agreement are incorporated herein by reference and shall apply as if set forth herein in full.

-100-

19.25 Histeric Places. The provisions of Section 20.21 of the Purchase Agreement are incorporated herein by reference and shall apply as if set forth herein in full.

19.26 Public Officials Not to Benefit. The provisions of Section 20.22 of the Purchase Agreement are incorporated herein by reference and shall apply as if set forth herein in full.

19.27 Flood Insurance Act. The provision of Section 20.23 of the Purchase Agreement are incorporated herein by ref-erence and shall apply as if set forth herein in full.

19.28 Safety. The provisions of Section 20.24 of the l

Purchase Agreement are incorporated herein by reference and shall apply as if set forth herein in full.

19.29 Buy American. The provisions of Section 20.25 of the Purchase Agreement are incorporated herein by reference and shall apply as if set forth herein in full.

-101-

ARTICLE XX Amendment This Agreement may not be amended, modified, or termi-nated, nor may any obligation hereunder be waived orally. Any amendment shall be in writing, and shall be signed by the Chief I

l Executive Officer or the President of Vepco or the person ei-ther of them may designate in writing and by the President of Old Dominion, or the person he may designate in writing, and

! must be approved by the Board of Directors of Old Dominion and Vepco subject to any required regulatory approvals, including the approval of REA.

i I

5

-102-l t

IN WITNESS WHEREOF, the Parties have caused this amended and restated Agreement to be executed by their duly authorized officers as of the day and year first above written.

VIRGINIA ELECTRIC AND POWER COMPANY By .L William W. Berry

.~ .

President

- ATTEST: M  ! w J j __

tA rtrf f V' 4~

Linwood R. Robertson Corporate Secretary OLD DOMINION ELECTRIC COOPERATIVE By efuf=e-1 p arry K. Bowman

. V President c

b' ' -

7.- ATTES .

a

)#* . N e-r

• James M. Re olds Secretary

-103-

STATE OF VIRGINIA:

to wit:

CITY OF RICHMdND:

The foregoing instrument was acknowledged before me this

,17th day of October, 1983, by William W. Berry and Linwood R.

Robertson, President and Corporate Secretary, respectively, of Virginia Electric and Power Company, a Virginia corporation, on behalf of the corporation.

/hanix As%A

~ Notary'Public My Commission expires:

l i ' 8l@l55

, .. ..,(SEAL)

' W..' '.

STATE OF VIRGINIA:

to wit:

CITY OF RICHMOND:

The foregoing instrument was acknowledged before I:e this

,17th day of October, 1983, by Harry K. Bowman and James M.

Reynolds, President and Secretary, respectively, of Old Domin-ion Electric Cooperative, a Virginia cooperative, on behalf of the cooperative.

Mif& O l Notary Public My Commission expires:

,, 4/90/W

/'

~j i

(SEAL) i S D '.

'r, *

-104-l

9 APPENDIX A OLD DOMINION MEMBERS BARC Electric Cooperative Millboro, VA bommunityElectricCooperative Windsor, VA

' AMecklenburg Electric Cooperative Chase City, VA Northern Neck Electric Cooperative Warsaw, VA Northern Virginia Electric Cooperative Manassas, VA Prince George Electric Cooperative Waverly, VA A

Rappahannock Electric Cooperative Bowling Green, VA Shenandoah Valley Electric Cooperative Dayton, VA Southside Electric Cooperative Crewe, VA l

f i

i i

l i

_ __ _ _ - - ~ ~ "

AFFENDIX 3 TRANSMISSION SERVICE CEutCE The monthly charges to be paid by Old Dominion for transmission services rendered by Vepco described in Article VI of the Interconnection and Operating Agreement shal'1 be:

(1) Eigh Voltage Transmission (equal to or greater than 69 kV)

(2) Monthly Bate $ /kw (3) Old Dominion detained Capacity kw (4) Righ Voltage Transmission Charges (lines 2 x 3) $

(5) Low Voltage Transmission (less than 69 kY)

(6) Monthly Este 8 /lar (7) Old Dominica Batained Capacity kw

(

(B) Low Voltage Transmission Charges

, (lines 6 z 7) $

(9) Imergency Transfer capability (when appropriate)

(10) Monthly tate $ /Inr (11) Old Dominion Wheeled Capacity kw (Section 6.02)

(12) Emergency Transfer Capability Charge $

(linas 10 x 11)

(13) Total Monthly Transmission Servics Charge (lines & + 8 + 12) $

G

" " ' " ' ' ' ' ' ~ ~ ~

4 Page 1 of 6 APPENDIX C Charges for Capacity and Energy Sold By Old Dominion to Vepco Percentage

, Old Dominion's Pur.'tased Total Costs for by Vepco Line the Applicable Pursuant to Amount No. Item Month Section 7.02 (1) x (2)

(1). (2) (3)

1. Capital Cost S $

Appendix C, Page 3, Line 3

2. Fixed Produc-tion Expenses i Appendix C, >

Page 5, Line 3

3. Sub Total (lines 1+2)

4. Sub Total (line 3) x 1.15

5. Total Opera-tion and Maintenance Expenses

6. Administrative and General Expenses

7. Taxes Paid or Incurred, Ex-clusive of Deferred Taxes Reflected in Schedules N-1 and N-2 of the Purchase, Con-struction and Ownership Agreement, by i

Old Dominion

Not Reflected i in Items 2, 5 and 6 above.

~ m -- e w-,--rw-wm>m-- v.e-rs. se emm, -w---- , rm.,-- --m ,. ew ,,,,--r--- . . - . . r y ew,,y- ----,e.-r--=+orge--,-..-,,..e,,---.,--g.y,

Appendix C Page 2 of 6

8. Cancellatian costs associ-ated with Surry 3 and 4, North Anna 4 and North f

Anna 3

9. Other Amounts Reflected in Charges by Vepco to Old Dominion Not Reflected above.

10. Total Fuel Expense Appendix C Page 6

==== $

11. Billing Amount (incl. 4+5+6

+7+8+9+10) i s

e 5

T

Appendix C Page 3 of 6 Determination of Old Dominion's Capital Cost for the Applicable Month Related to the Facilities Lir.e No . Item Amount 1 Interest Expense (a) $

2 Depreciation Expense (b) 3 Total Capital Costs (lines 1+2) $

(a) Interest expense will be calculated by using Old Domin-ion's weighted average interest rate on outstanding debt applicable to the Facilities

• applied to its monthly av-erage net investment ** in the, Facilities *Aand Nuclear Fuel including taxes payable by Old Dominion at the Closing (but exclucive of deferred tax payments reflected in Exhibit N of the Purchase, Construction and Ownership Agreement) and subsequent investments in the Facilities *,

if any, less the appropriate depreciation. Net invest-ment shall also include the present value of deferred tax payments reflected in Exhibit N of the Purchase, Con-struction and Ownership Agreement using an 11 percent discount rate with the interest expense applicable thereto at 11 percent for the entire buy-back period.

(b) Depreciation and amortization will be computed by apply-ing appropriate depreciation or amortization rates approved by REA to Old Dominion's total investment *** in i

the Facilities *, exclpding Nuclear Fuel, as determined

• above including the acquisition adjustment, if any. If

. the applicable depreciation rate does not include a com-ponent for decommissioning expenses, an appropriate al-lowance for such expenses shall be added to the monthly depreciation expense for the purposes of this calculation only.

• Facilities shall exclude investment in Major Spare Parts on which Vepco is paying old Dominion's carrying charge pursuant to the Purchase, Construction and Ownership Agreement.

• • Net investment shall mean original cost less accumulated de-preciation as defined under FERC's Uniform System of Accounts.

• Total investment shall mean original cost including taxes payable at Cloring at 100% of such payment and deferred taxes l .

Appendix C Page 4 of 6 as set forth in Exhibit N of the Purchase, Construction and Ownership Agreement at the present value of such payments using an 11 percent discount rate.

t i

n ---

w- r-,-, , - , - - - ,,,,,,,,,,-g--, , ,-, ... --y,--- ,,mw-- - --,- --cy--w-nc-,--e -

ce,,,,,rn,--.,, ep.,,,,r,,--- -. . - , -~g, - - - - ~ .

, Appendix C Page 5 of 6 Determination of Old Dominion's Fixed Production Expenses for the Applicable Month Related to the Facilities Line No. Item Amount

1. Property Taxes $

2. Insurance

3. Total Fixed Production Expenses $

f

-, e - - ~ - - , . , , _ . . , - , . - - . . , . . , , . - - - ...-.. _- - .,-,, , _ , - - - - . , . , , - , , - , - - - - . -,,. - - - - , , ..,,,,~_wmg._.ey g. ,

Appendix C Page 6 of 6 Determination of Monthly Purchased Energy Charge for North Anna 1 and 2 Payable to Old Dominion by Vepco Old Dominion's Percentage TotalAFuel Expenses Purchased By for the appuce Vepco Pursuant Amount Month (a) to Section 7.02 (1) x (2)

(1) (2) (3)

(a) Total Fuel Expense shall include burned owned fuel ex-pense, burned leased fuel expense, lease use charges, nu-clear fuel disposal expedses and other appropriate nucle-ar charges / credits.

I 1

I l

1 l

Appendix D Page 1 of 2  ;

APPENDIX D DETERMINATION OF AMOUNTS OF SUPPLEMENTAL DEMAND AND RESERVE AND SUPPLEMENTAL ENERGY I. ,Old Dominion Monthly Supplemental Demand (a) Old Dominion Monthly Delivered Demand, (com-bined Old Dominion hourly demand measured at the Interconnection Points for the clock hour during which the Combined System Monthly Peak Demand occurs).

less (b) Old Dominion Monthly Delivered SEPA Capacity.

the resulting difference (c) the factor of 100 divided by 100 minus

~

multiplied the Combined System Transmission Loss by Percentage (to reflect demand at the generation level),

(Equal to Old Dominion Monthly Demand) less (d) Old Dominion Monthly Retained Capacity, less (e) Old Dominion Monthly Accredited Firm and Non-Firm Capacity.

II. Old Dominion Monthly Maximum Diversified Demand (a) The combined Old Dominion Members monthly maximum coincident hourly demand measured at the Interconnection Points during the on-peak hours shown in the Rate Schedule attached to the Agreement as Appendix E.

III. Old Dominion Monthly Billing Demand (a) Old Dominion Monthly Supplmental Demand i

! plus (b) the kW, if any, by which the most recent 12-month average Old Dominion Monthly Maximum Diversified Demand exceeds 110% of the most recent 12-month average Old Dominion Monthly Delivered Demand with such excess multiplied by the factor of 100 divided by 100 minus the Combined System Transmission Loss Percentage.

Appsndix D

- Page 2 of 2 IV. Old Dominion Monthly Reserve and Supplemental Energy (a) Old Dominion Monthly Delivered Energy, less (b) Old Dominion Monthly Delivered SEPA Energy, with the resulting difference multiplied by (c) the factor of 100 divided by 100 minus the Combined System Transmission Loss Percentage (to reflect energy at the generation level),

(equal to Old Dominien Monthly' Energy) less (d) Old Dominion Monthly Retained Energy, less (e) Old Dominion Monthly Excess Energy, and less (f) Old Dominion Monthly Accredited Energy.

N e

l i

i i

l AP*ENDIX E Page 1 or 5 CHARGE 5 FOR PURCHASES BY 3.D DOMINION I. Monthly Supolemental Dernand charge The Montnly 5ucolemental Demand Charge shan be applicable to an Old Dominion Monthly Bining Demand

• determined for each calendar month in accordance with Appendix 0,Section III, of this Agreement and shan be:

l

$ . per kw

+In determining Old Dominion Monthly Billing Demand the fonowing on-peak hours shall be used for detarmining Old Dominion Monthly Maximm Oiversified Danand:

(a) 7:00 a.m. to 10;00 p.m., Mondays through Fridays, for the months of October through May, and (b) 10:00 a.m. to 10:00 p.m., Mondays through Fridays, for the months of June through Septemer.

II. Monthly Reserve and Supolemental Enercy Charge The Reserve and Supplemental Energy Charge shall be applicable to all Old Dewinian Monthly Reserve and Supplemental Energy datarmined for eacn calendar month in accordance with Appendix 0,Section IV, cf this Agreement md shan be.

O. d per lem IH. Annual Fuel Adjustment Factor

1. Old Dominion's Reserve and Supplemental Energy for each calendar month shall be multiplied by en annual fuel adjustment factor which shan be

! egual to the se of:

a. the estimated current period fuel adjustment factor, and

b. the deferral adjustment factor.

2. The estimated current period fuel adjustment factor to become effective with April of each year shan be based on the' estimated fuel expenses allocated to Old Dominion's estimated reserve and supplmental energy for the 12-month period beginning in April of each year, and sha n be calculated by the fuel adjustment factor formula shown below rounded to the nearest thousandth of a cent.

3. The deferral adjustment factor to become effective with April of each l year shall be based on the difference between the total fuel expenses (using the criteria outlined in (1) - (4) of Paragraph 7 below) allocable to Old Dominion and the total fuel recoveries by Old Dominion '

,for the 12 months prior to April of each year, divided by Old Dominion's-estimated reserve and supplemental energy for the 12-month period, beginning with April of each year (6 months where a semi-annual change is made pursuant to Paragraph 5. below). The deferral adjustment factor will be adjustad for taxes.

4 The intent of the annual fuel adjustment factor is to recover all fuel expenses anocable to Old Dominion. To the extent the amount recovered 80660R-3 w --ww w. s w---,w--r----,i-----+-,m r--- - - - - ----w- +vm-4*-w---w-wr-,-**Jw---w---wm'vm--- -*-y--s e y m- Mw- e ' wwr ywn ygr-'mW ' - - -

---

tw.me er w gg

i l

l l

APPENDIX E Page 2 of 5

. from Old Dominion through the annual fuel adjustment factor and the fLal component of the base rate exceeds the cost of fuel allocable to Old Dominion for the same time period, this over-recovery shall be a credit in the calculation of the deferral adjustment factor for the 12-month, period begiming with the next April. To the extent the amouit recovered fran Old Dominion through the annual fuel adjustment factor and the fuel component of the base rate is less then the cost of fuel allocable to Old Dominion for the same time period, this under-recovery s'.all be a charge in the calculation of the deferral adjustment factor for the 12-acnth period begiming with the next April.

5. The amual fuel adjusvent plus factor shall be reviewed on a semi-annual basis to detazinine if any change is required. The actual performance to date and any revisions to the fuel expense estimate will be reviewed and a change to the annual fuel adjustment factor may be made with October of that same year. The adjustment may be deferred uitil the end of the 12-month period, provided the net difference between the Congeny's actual and estimated uider-recovery is no greater than seven and one-half per centum of actual and estimated fuel expenses for the fuel factor year or the net difference between the actual and estimated over-recovery is no greater than five per centum of actual end estimated fuel expenses for the fuel factor year.

I ,

6. Initially, the Amual Fuel Adjustment Factor will be made effective as of the Closing Deta, and will be spread over the months starting from the Closing Data to the begiming of the next fuel factor year. This factor will be composed of:

a. en estimated current period fuel adjustment factor, based on the estimated fuel expenses allocated to Old Dominion and Old Dominion's estimated reserve and suxlemental energy from the Closing Data to the beginning of the next fusi factor year Plus l b. a deferral adjustment factor, based on actual under-recovered r or over-recovered fuel expenses applicable to Old Dominion, excluding the deferral portion associated with Old Dominion's anticipated energy reduction, on the day prior to the Closing Date anr! estimated Old Dominian reserve and supplemental energy from the Closing Date to the beginning of the next fuel factor year.

7 Fuel Adjustment Factor Formula:

'Sase (T) (133)

N={ <

Where:

F = Estimated annual fuel adjustment factor in cents per kilovetthour.

1. 0660R .

l O

- , , . - , - _ . , , , . ,,,,..--,__,.___-_,,,,..y..,,_.,.,.,.,,_,,,,m-.m,.__,,.-,c , ,,w _,--..y_,y ,.,,%_. , , ,y

APPDOIX E Page J of 5 E = Estimated system fuel expenses allocated to Cild Dominion for the 12-month period beginning with April of each year, detarmined as fellows:

(1) Fossil and nuclear fuel consumed in the Utility's tolly owned plants, and the utility's share of fossil and nuclear fuel consumed in jointly owned or leased plants excluding nuclear fuel consumed in Marth Anne Units 1, ed 2. The cost of fossil fuel sn 11 include no items other then those listed in Account 151 of the Counission's Uniform System of Accounts for Public utilities and Licensees. The cost of nuclear fuel shall be that as shown in Account 518, excluding nuclear fuel consumed in North Anna Unitr 1, and 2, estimated costs and salvage value associated with reprocessing ed disporsl of the nucLar fuel and by-protincts, and except that if Account 518 also contains any expense for fossil fuel, or another utility's share of jointly owned nuclear fuel, it shall be ded eted frtze this account.

Plus (2) Purchased Power fuel costs purchased vor reasons other than those identified in (3) beltar such as those incurred in Unit Power and Limited Term Power purchases where the fossil and nuclear costs associated with energy purchased are identifiabl~e and are identified in the billing statement.

Plus (3) The not energy cost of energy purchases, exclusive of capacity or demand charges (irrespective of the designation assigned to such transaction) when such energy is purchased on an economic dispate'1 basis.

Included therein say be such costs as the charges for economy energy purchases and the charges as a result of scheduled

- outage, all such kinds of energy being purchased to substituta for the Company's ,

own higher cost energy.

1. 0660R-5 ew .. .

.._--m.-_ _ .,,_ __. _ . . . , , _ . - - , . . . . . . - . , _ . . , _ _ . , , , _ _ , . - _ . _,.,,-,-w_.-.y.- . - . . , - . - -_, _ ,_,-_.-

ApoENDIX E Page A of 5 Energy recel;:ts that do not involve money payments such as Diversity Energy and pay-back of Storage Energy are not defined as Purchased or Interchanged Power relative to the Fuel Factor.

Minus (4) The cost of fossil and nuclear fuel recovered through inter-system sales including the fuel costs related to economy energy sales and other energy sold ai an economic dispatch basis.

Energy deliveries that do not involve billing transactions such as Diversity Energy and pay-back of Storage Energy are not defined as sales relative to the Fuel Factor. -

5 = Estimated Old Dominion's Reserve and Supplemental .:nergy for the 12-month period begiming with April of each year.

Base = The base cost of fuel per kWh sold. *(A new fuel base will be calculated after the test year has been reallocated removing all fuel expenses and kWh sales associated with North Ama Units 1 and 2.)

7.= Adjustment for state asid local taxes measured by gross recelots detemined separately for ressle customers in Virginia: 100%

divided by (100% minus applicable Gross Receipts Tax rate).

t IV. Monthly Charges for Purchases by Old Dominion l The Monthly Charges for Purchases Dy Old Dominion shall be the sum of Paragraphs I., II., and III.

l V. mo rformance Incentive Provision Old Dominion snall oe sucject to a charge or credit to the Monthly Charges for Pur::hases,Section IV of Appendix E, in accordance with the Rider PIP - Performance Incentive For Reserve and Supolemental Energy Requirements, Old Dominion Electric Cooperative, under Appendix E of the InteRwwtion and coeration Agreement which has been cttached and made a part of Appendix E uider this Agreement.

d e m - e eup . .

,--w-.--- -- -- - -,-,----_.,e.--- ,.--me, , , . . . ,m- _--,,-

y-,.9- my __ ,g-wwg -.

p,p,, , .m.-,.w-yw-,,.,,,-,y wg. . - - - . --,g,. y.,---y-y.,

Virginia Electric and Power Company APPENDIX E Page 5 or 5 MICER PIP - PERF08tMANCE IPCENTIVE FCR RESERVE AW SUP'LEMENT4. EERGY REQ.IIREENTS CLD 00MINICN ELauRIC i.UmMATIVE UNDER AP-'tNDIX E CF THE INitru JNNELi10N AW yr tMATION AMarMNT This Rider is acclicable to Old Dominion Reserve and Supplemental Energy provided i. rider Aggendix E of the Intercorriection and Operation Agreement in accerdance with .the terms and ctriditions of the Performance Incentive Provision of the Settlement Agreement filed with the Federal Enargy Regulatory Comeission on ,1962 mder Docket No. ER82-423-000.

For each month, es determined by the Performance Incentive Provision shall the etbearge (credit),(refmded) collected by the application of (credit of) $ /kwh to all Reserve and Supplemental Energy.

This Rider shall be effective for the 12 months beginning with July 1, 1964 and is designed to collect. 3 based on the current charge (credit) adjustment. A Member who ceases to De an Old Dominion Mescer anytime during t*iat period will be assessed (refunded) its share of the outstanding charge (credit) for the your.

This Rider will be terminated et anytime titring the 12 months when the full charge (credit) has been collected (refunded). At the end of the 12 months, if the full charge (credit) has not been collected (refunded), t'io amount of shortfall will carry over to the next period.

9 e

j Filed with FERC: Effective Date:

U@

,.-g- ,,e .- w. --,-.s -

,--m--myger,,e- r tww wg y. .--mw --,w--y--- ---,p---ey.e--m-g- y'-=9 --*=--g-vmev-w- --e-m-ymme y 9 a y ym--ng- .

Appendix F l Determination of Accumulated Deferred Income Taxes Related to the Facilities (a)

(000's) old Dominion Line FERC , Percent- Amount No. Account No. Description Total age (a) (1)x(2)

(1) (2) (3) 1 282 FERC Full Normalization 7.2 2 282 Liberalized Depreciation 7.2 3 282 /4 Taxes and Benefit Plan Costs Capitalized 7.2 4 283 Nuclear Fuel - Owned 7.2 5 283 Preliminary Operations -

North Anna 2 7.2 Total Accumulated deferred income tax balances resulting from investments in the Facilities as reflected in approved rates at closing including 3 any adjustments resulting from final determination by the Internal Revenue Service or from audits by regulatory authorities having juris-diction. Based on FERC approved rates in effect as of the Closing Date.

Amortization FERC Full Normalization - The balance of accumulated deferred income taxes resulting from investment in the Facilities as shown above will be amortized on a straight-line basis over the remaining composite book life of plant as determined under the full normalization requirements of the

[ FERC.

l l Liberalized Depreciation - Vintage year balances of the accumulated deferred income taxes resulting from depreciation of investment in the Facilities as shown above will be reduced by the applicable portion of the decrease in the total liberalized depreciation accumulated deferred taxes

attributable to the units.

1

! Nuclear Fuel-Owned - The balance of accumulated deferred income taxes

! resulting from investment in nuclear fuel as shown above will be amortized over the average burn life of nuclear fuel.

Taxes and Benefit Plan Costs _ Capitalized - Vintage year balances of the accumulated deferred income taxes resulting from investment in the Facilities as shown above will be amortized on a straight-line basis over remaining book ple.nt life.

Preliminary Operations - The balance of accumulated deferred income taxes resulting from North Anna 2 as shown above will be amortized on a straight-line basis ever remaining book plant life.

(a) To the extent Old Dominion's Percentage Ownership Interest is below 7.2%, the percentage shall be equal to that Percentage Ownersnip Interest.

Note: No investment tax credit applicable to North Anna has been utilized'on Vepco's income tax return at 12/31/82.

_~__.7 __

,,,._ ~ -- _.___ .. . . _ _ __, ~_ ,e-_. . - _ _ . - _ _ _ . -,, . , _ . - _ - __ , _- .__.-.,. _

APPENDIX G CHARGES FOR RESERVE CAPACITY ,

The Old Dominic n Reserve Capacity shall be determined in accor-dance with Section 8.06 of this Agreement.

The monthly Old Dominion Reserve Capacity Charge shall be:

Section 8.06 Reserve Capacity = kw Annual Cost per kw = $

Total Annual Old Dominion Reserve Capacity Charge = $

12 Monthly Old Dominion Reserve Capacity Charge $ _ __

O I

Virginia Electric and Power Company Appendix H D-4J Page 1 of 5 FACILTTES CHARGES L APPLICABILFfT This Appendix E envering the supply of Excess Facilities Service is applicable to Old Dominion in the territory served by the Company.

IL AVAILABILFTT Whenever Old Dominion requests the Company to supply electricity in a manner which wM require faenities in excess of Normal Service Faef11 ties as defined in Paragraph 1Y hereof, and the Company finds it praetfeeble, such faellities wS1 be provided in accordance with paragraphs M and Y hereof.

IIL MONTHLT RATE

1.  % of the estimated installed east of all distribution equipment and t facBities (rated below 89 kV) required in addition to Norma 15ervice Faenities.

2.  % of the estimated instaued cost of all transmission equipment and faenities (ra:ed 69 kV and above) required in addition to Norma 1 Service Faenities.

1Y. DETERMINATION OF NORMAL SERVICE FACILTf!ES The Company's Normal Service FaeRities at an interconnection point with Old Dominion shall be those the Company is committed to provide for service under this Operating Agreement, es it may be amended from time to time, and agreed to by the Operating Committee.

V. ERCESS FACILFTIES SERVICE Excess FacGities Service supplied hereimder shall be subject to the provisions of this Operating Agreement except as mod 15ed by the fonowing:

1. The Company's faenities wn1 be instaued in a place and manner satisfactory to the Company; and, upon request by the Company, Old Dominion win furnish the property on which any excess facElties may be located.

2. The Company may change facGities at its convenience so long as eauivalent service is rendered and the charge to Old Dominion is unaffected. In paragraphs 3, 4, and 5 below, a change in facilities shall mean one for which an increase or decrease in the monthly charge for Excess Faenities Service becomes appropriate.

l i

l . . _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ . _ _ _ . _ _ _ _ _ _ _ . . _ . . _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ , _ _ _ _ _ _ , _ , _ _ _ , _ , _ _ _ , _ , _ _ _ _ _ _ _ _ _ __

Virginia Elaetric and Power Company Appendix H D 4J Page 2 of 5

. FACILIT1ES CHARGES (Continued)

Y. EXCESS FACILITES SERVICE (Continued)

3. If within ten years from the initial connection of Excess Faenities Service at any Interconnection Potat or from the last change made in Company faenities at that point (1) Old Dominion wishes to <Secoutinue Excess Facilities Services or (2) Old Dominion ceases to take alectrie servios from the Company at that point; or (3) the Company determines that, in accordance with good engineering and operating practies, servlee to Old Dominion at such Interconnection Point requires a further change in Company facilities or in their classification as Normal or Excess Faculties, other than a change provided for in paragraph 4 below, Old Dominion wm:

(a) Agree to the new Monthly Excess Faenities Charge; or (b) Request that the Ixcess Paenities be removed and, in such event, Old Dominion wm reimburse the Company for the, costs speciSed in paragraph 5 below.

4. If Excess Faccities serving an Interconnection Point are changed by the Company within five years from the initial connection or from the last change made in Company facilities at that Point, not as a direct result of a change in Old Dominion's load or request by Old Dominion, Old Dominion wD1:

(a) Agree to such change by the Company before the change is made, if service is sts wanted by Old Dominion, provided that:

(1) if the change causes an increase in the Monthly Charge for Excess Faculties, the increase wm be effective only after the end of said five years, or (2) if the change causes a decrease in the Monthly Charge for

. Excess Facilities, the decrease wm be effective from the date the Company changes its faenities; or (b) Request the Company to remove the Excess FacGities at no cost to Old Dominion at the time the Company changes its facGities.

5. If faenities are removed or rearranged under paragraph 3 above, Old Dominion wm reimburse the Company as fonows:

(a) When right.t-of-way for such service are utnized for a period of less than 10 years, Old Dominion wm pay the Company the total cost of acquiring all rights-of-way which are abandoned within twelve months after any aforesaid event,' -

plus (b) The original installed cost (fe-line faculties, being the year's average instaned cost on units of property instaDed throughout the Company's system in W .. .-

Virginia Electric and Power Company Appendx H D-4J Page 3 of 5 FACILF11ES CHARGES (Continued)

V. EXCESS FACHRIES SERVICE (Continued) each calendar year)- plus- the estimated removal cost- less- salvage on au Company facilities instaued to provide such service and removed as a result of any such event, and if applicable, (c) The original installed cost (for line facilities, being the year's average instaBed cost on units of property instaBed throughout the Company's system in each calendar year) to rearrange and/or relocate such facGities to servlee such Delivery Point- plus- the estimated cost to return such faenities to their condition prior to serving such Interconnection Point if such facilities are changed as a result of any such event, -

less (d) A credt of 1/120th of such reimbursement for each full month the Company faellities at such Interconnection Point were utE! zed to serve Old Dominion, or its predecessor, except that no credt will apply if such faef11 ties were utQlzed for a period less than three years.

6. If at any time an or any part of the Excess Faenities become Normal Service Facilities, the Excess FacElties Service Charge wm esase or win be adjusted to reGeet such change.

YL EXISTING EXCESS FACHEIES SERVICE The Old Dominion Members have eartain ensting Excess Faenit!w Service for whleh Old Dominion wm pay the Company the Monthly Rate as provided in Paragraph D of this Appendix H. These Excess FacGities Services and the monthly costs are listed on Pagss 4 and 5 of this Appendiz H.

VIL CHANGES IN MONTHLY RATE Vepeo shan have the right to unilaterauy fee with FERC for a change in rates contained in this Appendir H under Sectim 205 of the Federal Power Act and ,

pursuant to the Commission's Rules and Regulations promulgated thereunder. In '

addition, nothing contained herein shan limit or modify in any respect Old Dominion's legal rights to oppose, in whole or in part, Vepeo's fning for a change in the rates contained In'this Appendix H or to complain of these rates pursuant to Section 208 of <

the Federal Power Act.

O

..--me = w a *

• e- - e- -w* w-*- wwwg.e-emre-r9m== rey--Ww m w ww e - - --e---er- - w=w-vw_ w*- wi--==w--umrr,r--wmi =-ew - w -- -

Virginia Electric and Power Company Appendix H D-4J Page 4 of 5 i

FACILFTIES CHARGES Estimated Installed Cost of Ezeess Transmission Distribution Cooperst!ve and Deliverv PoinJ Faeflities FaeQlties Facilities -

Northern Virrinia Electric Coop Bethel Delivery' Point Data Pulse Broad Run Delivery Point Data Pulse Catharpin Delivery Point Data Pulse Contry Club Delivery Point Data Pulse Cub Run Delivery Point Data Pulse HamsorM3ainesvi11e Delivery Poir.t 2-69KV OCB

& Assoc. Erguip, 1-line Operating Device & Data Pulse Johnson Delivery Point Data Pulse Lindendale Delivery Point Data Pulse Middleton Delivery Point Data Pulse Minniv01e Delivery Point Data Pulse Moore Deliv1ery Point Data Pulse Smoketown Delivery Peint Data Pulse Wellington Delivery Point Data Pulse Heflin Delivery Point Data Pulse Independent R111 Delivery Point Data Pulsa Sowego Delivery Point- ,

Data Pulse Shenandoah Vallev Electrie Coop Columbia Furnace Delivery Point Data Pulse Woodstock Delivery Point Data Pulse Brands Delivery Point Data Pulse Cold Springs Delivery Point Data Pulse Crimera Delivery Point Data Pulse Dayton Delivery Point Data Pulse Gardner Springs Delivery Point Data Pulse Mt. Jackson Delivery Point Data Pulse North River Delivery Point Data Pulse Sherando Delivery Point Data Pulse Timberv01e Delivery Point Data Pulse Trimbles MRI Delivery Point' Data Pulse J

021083 l

l

,-e- . - - - , - - - -

w .,m,- e ,. - , - - - -

,--,- - .-,v.. +, m, -.- -.-- -w.,. . , -,m-

Y!rginia Eleet-ie and Power Company Appendix M NJ Page 5 of 5 FACILITIES CHAR 3ES Estimated InstaDed Cost Type of Ezeess Transmission Distribution Cooperative and Deliverv Point FeeQlties Faculdes FacGitie Rappahannock Electrie Coop Bear Island Delivery Point Data Pulse

,, Cuckoo Delivery Point Data Pulse

/

Culpeper #1 Delivery Point Data Pulse Decapolis Delivery Point Data Pulse Deerfleid Delivery Point Data Pulse ,

Dunnes Delivery Point Data Pulse Greenwood Delivery Point Data Pulse Goldmine De11very Point Data Pulse Bustle Delivery Point Data Pulse Elngs Dominion Delivery Point Data Puise Malers Tavern D311very Point Data Pulse Oakshade Delivery Point .

Data Pulse Orchid Delivery Point . Data Pulse Orleans Delivery Point Data Pulse f Paytes Delivery Point Data Pulse Rixtey Delivery Point Data Pulsa Slabtown Delivery Point Data Pulse -

St. Johns Delivery Point Data Pulse Unionville D4.11very Point Data Pulse Warrenton Dell rery Point Data Pulse WQderness Delivery Point Data Pulse l

. otal value transmission facilities l

subject to facilities charge $

Total value distribution faeflities j

subject to facilities charge ,

l l

t 1

! 021083 l

eyy + - - - -

APPDIDIX I IIOMINAL VOLTAGES - PRE 3DIT DELIVERY POINTS Transmission Voltages 230 ky 115 kw 69 kv Distribution Voltages

. 46 kv 34.5 kv 23 kv 13.2 kv 12.5 kv O'

O' c

w __

l Appendix J Summary VIRGINIA ELECTRIC AND POWER COMPANY .

MONTHLY STATEMENT TO OLD DOMINION

~

MONTH 0F 19 (1) TOTAL OPERATION AND MAINTENANC_t CHARGE 5 (A) $

LESS: -

(2) AMOUNT ATTRIBUTAhLE TO OLD DOMINION ENTITLEMENT TO CAPACITY AND ENERGY <

PURCHASED BY VEPCO.(SEE APPENDIX C PAGE 1, LINE 5, COL.3)

PLUS:

(3) SUPPLEMENTAL DEMAND (APPENDIX E)

(4) RESERVE AND SUPPLEMENTAL ENERGY CHARGES (AFPENDIX E)

(5) RESERVE CAPACITY CHARGES (APPENDIX G)

(6) TRANSMISSION SERVICE CHARGES CAPPENDIX B)

(7) POWER FACTOR CHARGES (APPENDIX X)

(8) FACILITIES CHARGES (APPENDIX N)

(9) TOTAL $

l (A)

SUMMARY

OF TOTAL OPERATION AND MAINTENANCE CHARGES FROM APPENDIX L BUDGET ESTIMATE ADJUSTMENT 19 FOR 19 TOTAL (1) (2)

M.A. STATION OPERATION AND MAINT.

L18, COL 4,P1 $

L18, COL 4,P7 8 8 OTHER OPERATION AND MAINT, L20,P2 L20,PS ADMINIST. AND GEN.

OPERATION AND MAINT.

L18,P3 L16,P9 INTEREST ,

(L19, COL 4.P7

_ L21.P8 AND L17,P9)_

~ TOTAL

.9- _

AFFENDIX K PACE 1 of 2

_AFFENDII K POWER FACTOR Fower factor monitoring and compensation for power factor deviations shall be in accordanca with Article II of the Interconnection and Operating Agreement.

Each Old Dominion Member shall maintain a minimum lagging power factor of 95% on the aggregated loads of its delivery points during the on-peak period at the time of the Combined System peak Demand. Each Old Dominion Member sha n maintain either a power factor of 100% or a lagging power factor on the aggre-gated loads of its delivery points during off-peak hours. The on-peak period is defined as the hours of 7 as to 10 pu for all weekdays during the sonths of Oc tober through Ma7 and the hours of 10 as to 10 pu for all weekdays during the months of June through September.- The off-peak period is defined as all Saturdays. Sundays and Bolidays and au weekday hours not specified as on-peak hours. The above power factor criteria shall apply except that the operaties Committee may from time to time waive strict adherenca to these limits when it determines that less stringent limitations may be talarated for a period of time in certain regions of the Combined Electric System. To the extent Vepco insta ns reactive correction facilities on the Combined Electric System and a portion of these facilities are otherwise allocated to old Dominion, then old Dominion vi n be credited for such portion of the reactive correction prior to the application of the power factor correction charges pursuant to this Appendiz'E. '

,---e-. ==e +,

AFFENDIX K FACE 2 of 2 Monthly payment for the power factor deviation shall bet (1) For on-Feak deviations (2) Old Dominion Member's on-peak lagging re-active responsibility kvar (3) Monthly Lagging Power Factor Correction Charge 8 /kvar (4) Total On-Feak Charge $

(lines 2 x 3) *

(5) For off-Peak deviations (6) Old Dominica Member's off-peak leading reactive responsibility kvar (7) Monthly Leading Power Factor Correction Charge 8 /kvar (8) Total Off-Peak Charge $

(lines 6 x 7)

(9) Monthly Total Power Tactor Deviation Charge 3 (lines 4 + 8) i i

s

APPENDIX L PAGE 1 0F 11 BUDGET ESTIMATE VIRGINIA ELECTRIC AND POWER _CQHP1MY -

NORTN ANNA NUCLEAR STATION MUCLEAR PRODUCTION OPERATION AND MAINTEN1McE EXPENSEE MONTH OF 19 l

l M. A. UNITS NMJOR FERC AND COMMON SUPPORT SPARE ACCOUNT FACILITIES FACILITIES PARTS TOTAL

^ ^

OPERATION f1)

(1) 517 SUPERVISION AND ENGINEERING $ $

(2) 519 COOLANTS AND WATER (3) 520 STEAM EXPENSES (4) 521 STEAM FROM OTHER SOURCES (5) 522 STEAM TRANSFERRED-CREDIT (6) 523 ELECTRIC EXPENSE 5 (7) 524 MISCELLANEOUS MUCLEAR POWER EXPENSES (8) 525 RENTS I (9) TOTAL OPERATION ,,

M17NTENANCE (1)

(10) 528 SUPERVISION AND l

ENGINEERING (11) 529 STRUCTURES *

(12) 530 REACTOR PLANT ESUIP.

(13) 531 ELECTRIC PLANT (14) 532 MISCELLANEOUS MUCLEAR PLANT .

(15) TOTAL MAINTENANC,E ,

(16) TOTAL OPERATION AND MAINTENANCE (17) ODE'c PERCENTAGE OWNERSHIP INTEREST E X (18) ODEC PR0 RATA SHARE S S

APPENDIX L PAGE 2 0F 11 BUDGET ESTIMATE VIRGINIX ELECTRIC AND POWER COMPANY -

OTHER NUCLEAR PRODUCTION OPERATION AND MAINTENANCE EXPENSES MONTN OF 19 l

SYSTEM COSTS j FERC CHARGED TO ACCOUNT (EXCLUDES MUCLEAR FUEL) _

NUCLEAR PRODUCTION OPERATION (A)

(1) 517 SUPERVISION AND ENGINEERING $

(2) 519 C00LANTS AND WATER (3) 520 STEAM EXPENSES (4) 521 STEAM FROM OTHER SOURCES (5) 522 STEAM TRANSFERRED-CREDIT (6) 523 ELECTRIC EXPENSES (7) 524 MISCELLANEOUS MUCLEAR POWER EXPENSES (8) 525 RENTS (9) 557 OTHER EXPENSES-MUCLEAR __

(10) TOTAL OPERATION MAINTENANCE (A) 0 (11) 528 SUPERVISION AND ENGINEERING l (12) 529 STRUCTURES l (13) 530 REACTOR PLANT ESUIPMENT (14) 531 ELECTRIC PLANT (15) 532 MISCELLANEOUS NUCLEAR PLANT (16) TOTAL MAINTENANCE (17) 556 SYSTEM NUCLEAR CONTROL AND LOAD DISPATCHING (Based on ratio of nuclear capacity to total capacity)

(18) TOTAL OPERATION. MAINTENANCE AND LOAD DISPATCHING _

(19) ODEC PERCENTAGE OWNERSHIP (5) X (20) ODEC PRORATA SHARE $

m APPENDIX L PAGE 3 0F 11 BUDGET ESTIMATE VIRGINIA ELECTRIC AND POWER COMPANY -

ADMINISTRATIVE AND GENERAL EXPENSES APPLICABLE TO NORTH ANNA MONTH OF 19 TERC 1 ACCOUNT TOTAL OPERATION (A)

(1) 920 ADMINISTRATIVE AND GENERAL SALARIES $

(2) 921 0FFICE SUPPLIES AND EXPENSES l3) 922 ADMINISTRATIVE EXP. TRANS.- CREDIT 43 923 OUTSIDE SERVICES 53 924 PROPERTY INSURANCE l6) 925 INJURIES AND DAMAGES l7) 928 REGULATORY COMMISSION EXP.

8) 929 DUPLICATE CHAP.GES - CREDIT

9) 930 MISC. - GENERAL EXPENSES l10) 931 RENTS l11) TOTAL OPERATION

~

MAINTENANCE (A) l12) 932 MAINTENANCE Or GENERAL PLANT l13) TOTAL MAINTENANCE l14) TOTAL OPERATION AND MAINTENANCE l15) ODEC ADMINISTRATIVE AND GENERAL ALLOCATION FACTOR (C) X l16) . SUBTOTAL ODEC PRORATA SHARE l

l

, :17) 165 INSURANCE PREMIUMS - NORTH ANNA l18) CDEC PR0 RATA SHARE

• 1 l

l l

. ~ _ . _ . .

APPENDIX L PAGE 4 0F 11 ACTUAL VIRGINIA ELECTRIC AND POWER COMPANY -

NORTH ANNA MUCLEAR STATION MUCLEAR PRODUCTION OPERATION AND MAINTENANCE EXPEMSES MONTH OF 19 M.A. UNITS KUOR FERC AND COMMON SUPPORT SPARE ACCOUNT FACILITIES FACILITIES PARTS TOTAL 6 _

r _

OPERATION (A)

1) 517 SUPERVISION AND ENGINEERING $ $

2) 519 COOLANTS AND WATER

3) 520 STEAM EXPENSES

43 521 STEAM FROM OTHER -

SOURCES

53 522 STEAM TRANSFERRED-CREDIT

6) 523 ELECTRIC EXPEN5ES

7) 524 MISCELLANEOUS MUCLEAR FOWER EXPENSES -

8) 525 REMTS

9) TOTAL OPERATION MAINTENANCE (A)

10) 528 SUPERVISION AMD )

l ENGINEERING '

11) 529 STRUCTURES l12) 530 REACTOR PLANT E9UIP.

13) 531 ELECTRIC PLANT l14) 532 MISCELLANEOUS MUCLEAR PLANT l15) ' TOTAL MAINTENANCE l l16) TOTAL OPERATION AND MAINTENANCE l17) ODEC PERCENTAGE OWNERSHIP INTEREST X X l18) ODEC PRORATA SMARE S $

APPENDIX L PAGE 5 or 11 ACTUAL VIRGINIA ELECTRIC AND POWER COMPANY -

OTHER NUCLEAR PRODUCTION OPERATION AND MAINTENANCE EXPENSES j MONTH OF 19 l SYSTEM COSTS TERC CHARGED TO ACCOUNT (EXCLUDES NUCLEAR FUEL) NUCLEAR PRODUCTION OPERATION (A) . . ,

(1) 517 SUPERVISION AND KMGINEERING $

(2) 519 C00LANTS AND WATER (3) 520 STEAM EXPENSES (4) 521 STEAM FROM OTHER SOURCES (5) 522 STEAM TRANSFERRED-CREDIT (6) 523 ELECTRIC EXPENSES (7) 524 MISCELLANEDUS NUCLEAR POWER EXPENSES (8) 525 RENTS (9) 557 OTHER EXPENSES-NUCLEAR (10) TOTAL OPERATION HAINTENANCE (A)

(11) 528 SUPERVISION AND ENGINEERING (12) 529 STRUCTURES (13) 530 REACTOR PLANT ESUIPMENT (14) 531 ELECTRIC PLANT (15) 532 MISCELLAMECUS MUCLEAR PLANT (16) TOTAL MAINTENANCE (17) 556 SYSTEM NUCLEAR CONTROL AND LOAD DISPATCHING (Based on zatio of nuclear capacity to total capacity)

(18) TOTAL OPERATION MAINTENANCE AND LOAD DISPATCHING CDEC PERCENTAGE OWNERSHIP (B) X (19)

(20) CDEC PRORATA SHARE

APPENDIX L PAGE 6 0F 11 ACTUAL VIRGINIA ELECTRIC AND POWER COMPANY -

&DMINISTRATIVE AND.. GENERAL EXPENSES APPLICABLE TO NORTH ANNA

. MONTH OF 19 ,_

FERC ACCOUNT TOTAL OPERATION (A)

(1) 920 ADMINISTRATIVE AND GENERAL 5ALARIES $

(2) 921 0FFICE SUPPLIES,AND EXPENSES (3) 922 ADMINISTRATIVE EXP. TRANS.- CREDIT (4) 923 OUTSIDE SERVICES (5) 924 PROPERTY INSURANCE (6) 925 INJURIES AMD DAMAGES (7) 928 REGULATORY COMMISSION EXP.

(8) 929 DUPLICATE CHARGES - CREDIT J (9) 930 MISC. - GENERAL EXPENSES i (10) 931 RENTS .

1 (11) TOTAL OPERATION MAINTENANCE (1)

(12) 932 MAINTENANCE OF GENERAL PLANT (13) TOTAL MAINTENANCE

~

(14) TOTAL OPERATION AND ~

MAINTENANCE i

+ (15) ODEC ADMINISTRATIVE AND GENERAL ALLOCATION FACTOR (C) X (16) SUBTOTAL ODEC PRORATA SHARE (17) 165 INSURANCE PREMIUM 5 - NORTH ANNA PREPAYMENT 5 (18) ODEC PRORATA SHARE $

l f

l

APPENDIX L PAGE 7 0F 11 ADJUSTMENT - RCTUAL TO BUDGZT VIRGINIA ELECTRIC AND POWER COMPANI .

NORTM ANNA NUCLEAR STATION NUCLEAR PRODUCTION OPERATION AND MAINTENANCE EXPENSES MH OF 19 l

l M.A. UNITS >MJOR FERC AND COMMON SUPPORT SPARE ACCOUNT FACILITIES FACILITIES PARTS TO'TAL OPERATION (1)

(1) 517 SUPERVISION AND ENGINEERING $ $

(2) 519 C00LANTS AND WATER (3) 520 STEAM EXPENSES (4) 521 STEAM FROM OTHER SOURCES (5) 522 STEAM TRANSTERRED-CREDIT (6) 523 ELECTRIC EXPENSES (7) 524 MISCELLANEOUS MUCLEAR POWER EXPENSES (4) 525 RENTS (9) TOTAL OPERATION -

MAINTENANCE (1)

(10) 524 5UPERVISION AND ENGINEERING (11) 529 STRUCTURES (12) 530 REACTOR PLANT ESUIP.

(13) 531 ELECTRIC PLANT (14) 532 MISCELLANEOUS MUCLEAR PLANT (15) TOTAL MAINTENANCE (16) TOTAL OPERATION AND MAINTENANCE (17) ODEC PERCENTAGE OWNER 5MIP INTEREST X 5 (18) ODEC PRORATA SMARE (19) INTEREST (20) TOTAL $ $

APPENDIX L PAGE 8 0F 11 ADJUSTMENT - ACTUAL TO BUDGET VIRGINIA ELECTRIC AND POWER COMPANY -

OTHER NUCLEAR PRODUCTION OPERATION AND MAINTENANCE EXPENSES MONTH OF 19 SYSTEM COSTS FERC CHARGED TO .

ACCOUNT (EXCLUDES NUCLEAR FUEL) NUCLEAR PRODUCTION OPERATION (A)

(1) 517 SUPERVISION AND ENGINEERING $

(2) 519 COOLANTS AND WATER (3) 520 STEAM EXPENSES (4) 521 STEAM TROM OTHER SOURCES (5) 522 STEAM TRANSTERRED-CREDIT (6) 523 ELECTRIC EXPENSES (7) 524 MISCELLANEOUS MUCLEAR POWER EXPENSES (8) 525 RENTS (9) 557 OTHER EXPENSES-MUCLEAR (10) TOTAL OPERATION MAINTENANCE (A)

(11) 528 SUPERVISION AND ENGINEERING #

(12) 529 STRUCTURES (13) 530 REACTOR PLANT EQUIPMENT

(.14 ) 531 ELECTRIC PLANT (15) 532 MISCELLANEOUS NUCLEAR PLANT

.(16) TOTAL MAINTENANCE (17) 556 SYSTEM HUCLEAR CONTROL AND LOAD DISPATCHING (Based on ratio of total capacity to nuclear capacity)

(18) TOTAL OPERATION MAINTENANCE AND LOAD DISPATCHING (19) CDEC PERCENTAGE OWNERSHIP (B) X (20) CDEC PRORATA SHARE (21) INTEREST

\

(22) TOTAL $

APPENDIX L PAGE 9 0F 11 ADJUSTMENT - ACTUAL TO BUDGET l VIRGINIA ELECTRIC AND POWER COMPANY .

ADMINISTRATIVE AND GENERAL EXPENSES APPLICARLE TO NORTH ANNA MONTH OF 19 FEnc ACTUAL AT ESTIMATE AT DIFFERENCE ACCOUNT X X JCOL.1-COL.2)

OPERATION (A)

(1) 920 ADMINISTRATIVE AND GENERAL 5ALARIF.S $ $ $

(2) 921 0FFICE SUPPLIES AND EXPENSES (3) 922 ADMINISTRATIVE EXP.

TRANS.-CREDIT (4) 923 OUTSIDE SERVICES  !

(5) 924 PROPERTY INSURANCE (6) 925 INJURIES AMD DAMAGES (7) 928 REGULATORY COMMISSION EXPENSES (8) 929 DUPLICATE CHARGES - CR.

(9) 930 MISC. - GENERAL EXPENSES (10) 931 RENTS (11) TOTAL OPERATION MAINTENANCE (A)

(12) 932 MAINTENANCE OF GENERAL l

PLANT l

! (13) TOTAL MAINTENANCE (14) TOTAL OPERATION AND MAINTENANCE (15) ,

INSURANCE PREMIUMS -

_ NORTH AMMA PREPAYMENT 5 (16) ODEC PRORATA SNARE $ $

. l (17) INTEREST (18) TOTAL $

---

e,w- .. - ,,, ,,r e,.--- - , - - - - - - - - - , . - - . . . - -

.,~~-._ve----,--,. --,-----.--...-_.-w--._w., -.-.--e,.- . , , - - - - ._

l l

l APPENDIX L PAGE 10 OT 11

.VIRGIKIA_ ELECTRIC AND POWER COMPANY

• FOOTNOTES -

l l

(A) OLO DOMINION WILL PAY ITS PRO RATA SHARE OF EMPLOYEE PENSIONS AND BENEFITS WHICH ARE CHARGED TO ADMINISTRATIVE AND GENERAL EXPENSES, BASED ON THE RATIO OF PENSION AND BENEFIT COST TO TOTAL PAYROLL.

THE ATOREMENTIONED RATIO WILL BE APPLIED TO SALARIES AND WAGES INCLUDED IN THE VARIOUS OPERATION AND MAINTENANCE EXPENSE ACCOUNTS.

ALSU, DLD DOMINION WILL PAY ITS PRO RATA SHARE OF PAYROLL TAXES BASED ON THE RATIO OF PAYROLL TAXES TO TOTAL PAYROLL.

(B) ALLOCATED BASED ON THE RATIO OT OLD DOMINION'S ENTITLEMENT TO NUCLEAR CAPACITY, TO TOTAL NUCLEAR CAPACITY IN COMMERCIAL OPERATION.

s") OLD DOMINION WILL PAY ITS PRO RATA SHARE OF ADMIMISTRATIVE AND GENERAL EXPENSES THROUGH AN ALLOCATION OF SUCH ADMINISTRATIVE AND CENERAL EXPENSES AS TOLLOWS l

(1) ADMINISTRATIVE AND GENERAL EXPENSES APPLICABLE TO PRODUCTION WILL BE DETERMINED USING THE FORMULA:

f PRODUCTION SALARIES AND WAGES IN ELECTRIC OPERATION AND MAINTENANCE EXPS. = PRODUCTION TOTAL SALARIES AND WAGES IN ELECTRIC ALLOCATION TACTOR t

OPERATION AND MAINTENANCE EXPENSES EXCLUDI;4G ADMINISTRATIVE AND GENERAL

(

i l

l l _, _ _ _ _

9 APPENDIX L PAGE 11 0F 11

~

VIRGINIA ELECTRIC AND POWER COMPANY <

FOOTNOTES (2) THE PRODUCTION ALLOCATION FACTOR WILL BE MULTIPLIED BY THE RATIO OF OLD DOMINION's ENTITLEMENT TO CAPACITY IN COMMERCIAL OPERATION TO TOTAL VEPCO AND OLD DOMINION CAPACITY IN COMMERCIAL OPERATION TO GET '.*HE OLD DOMINION ADMINISTRATIVE AND GENERAL ALLOCATION FACTOR.

l e

l l

APPENDIX M LIST OF SUPERCEDED CONTRACTS BETWEEN VEPCO AND OLD DOMINION MEMBERS (CONTRACT FOR THE PURCHASE OF ELECTRICITY FOR RESALE El RURAL ELECTRIC COOPERATIVE)

Cooperative Effective Date Contract No.

BARC Electric Cooperative April 1, 1967 5801 A

Community Electric Cooperative April 1, 1967 5802 AMecklenburg Electric Cooperative April 1, 1967 5804 Northern Neck Electric Cooperative April 1, 1967 5805 Ziorthern Virginia Electric 5803 Cooperative January 1, 1983 5811 Prince George Electric Cooperative April 1, 1967 5807 Rappahannock Electric Ccoperative January 2, 1980 8935 Shenandoah Electric Cooperative April 1, 1967 5809 Southsicte Electric Cooperative April 1, 1967 5810

/\

l l

l I

I l

NUCLEAR FUEL AGREEMENT Between i

VIRGINIA ELECTRIC AND POWER COMPANY and OLD DOMINION ELECTRIC COOPERATIVE DATED: As of December 28, 1982 Amended and Restated October 17, 1983

'l

THIS NUCLEAR FUEL AGREEMENT, dated as of December 28, 1982, but, amended and restated on October 17, 1983, between VIRGINIA ELECTRIC AND POWER COMPANY ("Vepco"), a Virginia public service corporation with its principal office at One James River Plaza, Richmond, Virginia 23261, and OLD DOMINION ELECTRIC COOPERATIVE

("Old Dominion"), a Virginia generation and transmission cooperative with its principal office at 5601 Chamberlayne Road, Richmond, Virginia 23227, provides as follows:

WHEREAS, Vepco is a publi' service corporation engaged in furnishing electric utility serv.ie in portions of Virginia, North Carolina and West Virginia, and as such owns and operates facilities for the generation, transmission and distribution of electricity within those states; WHEREAS, Old Dominion is a generation and transmission cooperative representing, among others, Old Dominion Members and is charged with the responsibility, through generation, transmission or other means, of providing electricity for Old Dominion Members; WHEREAS, Old Dominion desires to participate with Vepco in the ownership of certain generating facilities and to that end has entered into a Purchase, Construction and ownership Agreement (the " Purchase Agreement") of even date herewith which provides for the purchase on the Closing Date of certain undivided interests in portions of the North Anna Nuclear Power Station; and

WHEREAS, Old Dominion wishes to purchase, and Vepco is willing to sell, certain undivided interests in the Nuclear Fuel for the North Anna Nuclear Power Station; NOW, THEREFORE, in consideration of the premises and the mutual obligations hereinafter stated, the Parties hereto agree as follows:

l l ARTICLE I Definitions The words and terms used herein shall have the following meanings and the provisions of Article I of the Purchase Agreement are incorporated by reference herein and shall apply as if set forth herein in full, except that (i) the definition of Old Dominion's Percentage Ownership Interest in Section 1.28 as it applies to Nuclear Fuel shall include the Old Dominion Nuclear Fuel, tii) the definition of Facilities in Section 1.10 shall include Nuclear Fuel and (iii) the definition of Agreement shall mean the Nuclear Fuel Agreement.

1.01 Designated Nuclear Fuel. The individual fresh and irradiated nuclear fuel assemblies and associated Non Fuel Incore Devices for North Anna Units 1 and 2, whether in storage or in use in any such Unit, and any Nuclear Fuel in process, any of

which is designated by Vepco on its bocks of account in accordance with Prudent Utility Practice for use in any of North Anna Units 1 and 2 including, but not limited to, uranium in l

l inventory being converted or enriched and being fabricated or shipped, together with all replacements thereof and additions i

thereto. Designated Nuclear Fuel shall also include any Nuclear

1 Fuel designated for any of North Anna Units 1 or 2 and owned by the United States Government. l 1.02 Non Fuel Incore Devices. Equipment such as control rod  ;

assemblies, primary and secondary neutron sources, burnable poison rod assemblies and plugging devices that do not contain nuclear fuel but are ordered with and/or loaded into and operated with Nuclear Fuel in the reactor core.

, 1.03 Nuclear Fuel. The Designated Nuclear Fuel and Undesignated Nuclear Fuel (including Spent Nuclear Fuel) described in Exhibit A hereto.

1.04 Nuclear Fuel Contracts. Those contracts 44escribed in Exhibit B hereto.

1.05 Old Dominion Nuclear Fuel. Old Dominion Nuclear Fuel shall be the Old Dominion Percentage Ownership Interest in Nuclear Fuel and be calculated as follows: (i) for Designated Nuclear Fuel, a percentage equal to the Old Dominion Percentage Ownership-Interest in each respective Unit for which the Designated Nuclear Fuel is designated, as that percentage is modified from time to time in accordance with Sections 15.03, 16.01 and 16.02 hereof and (ii) for Undesignated Nuclear Fuel, the percentage calculated in accordance with the provisions of i

Section 7.02 hereof, as that percentage is modified in accordance with Sections 15.03, 16.01 and 16.02 hereof, from time to time.

1.06 Spent Nuclear Fuel. Nuclear Fuel from North Anna Units 1 and 2 which Vepco determines has completed its useful life and which will be stored, transported and reprocessed or temporarily or permanently disposed. .

- , - - - - --_. --- -.--,-, - - - . ,,, - . ,- ,, m --.,,,-.-m,e-%., -.-n , - --,.,m---.--, ~ . , -

_4 1.07 Spent Nuclear Fuel Disposal Costs. Any cost or credit 2

associated with the storing, transporting and reprocessing or temporary or permanent disposal of Spent Nuclear Fuel and associated Non Fuel Incore Devices.

1.08 Undesignated Nuclear Fuel. All of Vepco's uranium inventory and an'; don Fuel Incore Devices not yet designated by vepco on its books of account in accordance with Prudent Utility Practice for use in any particular nuclear unit, whether acquired for North Anna Units 1 or 2 or any other Vepco nuclear generating unit.

l 1.09 Westinghouse Uranium Settlement. That settlement, dated June 22, 1979, in the case styled In re Westinghouse Electric Corporation Uranium Contracts Litigation contained in docket MDL DOC. No. 235.

ARTICLE II Purchase of Old Dominion's Percentage Ownership Interest 2.01 Purchase of Old Dominion Nuclear Fuel at the Closing.

Subject to the terms and conditions herein set forth, at the Closing, Vepco agrees to sell and convey and Old Dominion agrees to purchase and pay for the Old Dominion Nuclear Fuel. Prior to or at the Closing, Vepco will secure a release of the Old Dominion Nuclear Fuel from the lien of the Indenture of Mortgage.

Vepco shall convey title to the Old Dominion Nuclear Fuel by the delivery of a Bill of Sale, substantially in the form of Exhibit C hereto, conveying such undivided ownership interest in all property listed thereon and an Assignment Agreement,

substantially in the form of Exhibit D hereto, assigning such undivided ownership interest in Vepco's rights, duties and obligations under the Nuclear Fuel Contracts. The Parties agree i

i (i) that any assignments of contracts with the Department of Energy are subject to the approval of the Department of Energy and (ii) that all assignments under this Section are subject to the provisions of Section 8.02 hereof.

ARTICLE III  ;

Payments for Old Dominion's Percentage ownership Interest

. The provisions of Sections 3.03 through 3.07 of the Purchase l Agreement are incorporated herein by reference and shall apply as  !

if set forth in full.

3.01 Payment for Old Dominion Nuclear Fuel at the Closing.

At the Closing, Old Dominion shall pay to Vepco for the Old Dominion Nuclear Fuel being purchased at the Closing the amount resulting from the application of the calculations (incloding a ,

reduction, net of federal and state income taxes, if any, resulting from the Westinghouse Uranium Settlement) , and subject to the adjustment, both as prescribed in Exhibit E hereto.

3.02 Additional Payments After Closing for the Old Dominion Nuclear Fuel. Old Dominion shall be required to make Additional Payments After Closing for the Old Dominion Nuclear Fuel (as if Nuclear Fuel were included in the definition of Facilities) pursuant to the form of Estimated Expenditures Invoice that is attached hereto as Exhibit F in the same manner, and at the same times, as Old Dominion is required to make Additional Payments

After Closing with respect to New Investment pursuant to Section 3.02 of the Purchase Agreement. The Parties agree (i) that the accounting for such Additional Payments After Closing for Nuclear Fuel will be consistent with the inventory accounting utilized by Vepco (based upon booked expenditures) and (ii) that there will be appropriate title and investment adjustments, pursuant to Section 7.05 hereof, each time that a batch of Nuclear Fuel is designated for a particular unit.

ARTICLE IV Representations and Warranties The provisions of Article IV of the Purchase Agreement are incorporated herein by reference and shall apply as if set forth herein in full.

l i ARTICLE V The Closing and Closing Date ,

The provisions of Article V of the Purcnase Agreement are incorporated herein by reference and shall apply as if set forth herein in full.

1 ARTICLE VI Conditions to Closing The provisions of Article VI of the Purchase Agreement are incorporated herein by reference and shall apply as if set forth l

herein in full.

i l

l

ARTICLE VII Nuclear Fuel 7.01 Financing of Nuclear Fuel. The Parties agree that either Party may elect to lease or own its respective ownership interest in Nuclear Fuel. Any such decision to lease or own nuclear fuel may be made independently with the result that one Party may own its percentage interest in Nuclear Fuel while the other Party leases its ownership interest in Nuclear Fuel.

Accordingly, the Parties retain the right to enter into transactions (whether by lease, heat supply contract or otherwise) for the financing of Nuclear Fuel. The cost of any additional instrumentation required in connection with the financing of Nuclear Fuel shall be the sole responsibility of the Party entering into such transaction. Upon the agreement of Old Dominion, Vepco may sell and convey the Old Dominion Nuclear Fuel for such purposes, either independently or in conjunction with Vepco's interest in Nuclear Fuel. In that event, Vepco shall cause the purchaser of any such Nuclear Fuel to reimburse Old Dominion for the Old Dominion Nuclear Fuel, exclusive of AFUDC and any taxes paid by Old Dominion and included in the price paid by Old Dominion at the Closing for the Old Dominion Nuclear Fuel as provided in Section 3.01 hereof. In such case, the Parties

agree to execute end deliver further documents of title conveying, free and clear of all liens and encumbrances, the interest in the Nuclear Fuel required by this Section. For any Nuclear Fuel under lease or heat supply contracts as of the

Closing Date, Old Dominion shall participate as if a party to

- _ . _ _ ..,.._.._,.....,_.._.._,,__,,.___,.,_,,,.,.,.._,._.,m.. . . . . . . _ _ _ . . . _ _ , _ , - . . . _ - _ _ , _ , _

such arrangement and pay its share of rental or heat supply payments in the proportion to its ownership interest in the I

Nuclear Fuel. In addition. Old Dominion shall pay to Vepco a fee (based upon the monthly balance of the principal amount outstanding), equal to its pro-rata share of the fee paid by Vepco to support the credit of the owner of the Nuclear Fuel.

Such fee shall be due to Vepco from Old Dominion at the same time as Vepco's fee is due. In future negotiations by Vepco for the financing of Nuclear Fuel, Vepco agrees to use its best efforts to have old Dominion included as a party with several and not joint liability, in which event such fee to Vepco shall not apply. But if Vepco is not successful in securing such terms, Old Dominion shall continue to pay such a fee to Vepco.

7.02 Undesignated Nuclear Fuel. The Old Dominion Percenrage ownership Interest in the Undesignated Nuclear Fuel shall be computed in accordance with the following formula:

1 OI = NAl x 0.116 + PNA2 x .116 Pgy , PS2 + NAl + NA2 l where P = thermal power level in Megawatts, S = Surry (appropriate unit) , NA = North Anna (appropriate unit) and OI = Old Dominion Percentage Ownership Interest i

When any nuclear unit stated in the above formula is permanently removed from service, if Vepco or Old Dominion obtains any interest in an additional nuclear unit or if the unit's power level is derated or uprated, the formula, as well as the adjustments required by Section 7.05 hereof, will be appropriately adjusted.

l ,

.._ _ ._.._ _ _ _ .-. _ . . . . - . _ . . - _ . _ . _ . _ _._ _ .._ _ __ _ _ . . , _ . - ~ _ . . _ _ _ .

7.03 Spent Nuclear Fuel.

(a) Subject to the provisions of this Section, Old Dominion will take title to and assume full financial responsibility for its Old Dominion Nuclear Fuel interest in Spent Nuclear Fuel Disposal Costs for all Spent Nuclear Fuel.

(b) No reduction in the Old Dominion Nuclear Fuel interest pursuant to Sections 15.03, 16.01 or 16.02 hereof shall reduce the Old Dominion Nuclear Fuel interest in Nuclear Fuel that is Spent Nuclear Fuel at the time of the adjustment.

(c) For the Old Dominion Nuclear Fuel that is Spent Nuclear Fuel as of the Closing Date, the Parties agree that Old Dominion will only be responsible for Spent Nuclear Fuel Disposal Costs in a percentage equal to Old Dominion's load ratio share (energy) of North Anna Unit 1 and North Anna Unit 2 for periods prior to the Closing Date. For Spent Nuclear Fuel Disposal Costs after the closing Date, the Parties will be responsible for a percentage equal to their respective ownership interests in the appropriate Unit. Old Dominion shall receive as a credit against such amounts all Spent Nuclear Fuel Disposal Costs that Old Dominion or its members had paid to Vepco in rates prior to the Closing Date.

(d) Notwithstanding any other provision of the Basic Agreements, spent nuclear fuel from any nuclear power station on l the 7epco system may be stored at any other nuclear power l

station. The Parties agree to bear any costs incurred in connection with such storage in proportion to the benefits

~

received by each party from such storage; provided that to the

Y extent there is an adverse impact to one party due to storage by the other Party, the impacted Party shall be compensated by the other Party to the extent necessary to make the impacted Party whole.

7.04 Normal Adjustments for Nuclear Fuel Quantities and Quality. Old Dominion recognizes that contract provisions for the acquisition, conversion, enrichment, fabrication and other phases of the nuclear fuel cycle may provide for deliveries and payments based upon estimated quantities and quality. Old Dominion agrees that it will be bound by the adjustments properly made by Vepco on its books of account with respect to such estimates. ,

1 7.05 Title and Investment Adiustments Whenever Undesignated ,

Nuclear Fuel is Designated.

(a) Any time a batch of Undesignated Nuclear Fuel is designated for a Surry Unit, Vepco shall pay Old Dominion an amount so that the Oid Dominion investment (including all cost j

components comprising New Investment, undepreciated) in that batch is $0. Old Dominion agrees to execute such title and release documents as are required by Section 16.04 hereof.

)

(b) Any time a batch of Undesignated Nuclear Fuel is designated for a North Anna Unit, Old Dominion shall pay Vepco an amount so that the percentage of the total investment (including all cost components comprising New Investment, undepreciated) of each Party in the batch being designated is equal to the  !

! respective Party's current ownership interest in the Unit for i

, , - - . . _ - . ~ , _ . _ _ . , _ , _ _ . _ _ . _ . - _ _ _ - . - . _ _ _ _ . _ - , _ _ . . _ . . . . _ _ - . . . . _ , , _ _ . _ _ _ _ _ _ . _ . . -

which it is designated. Any such payment shall reflect a reduction, net of applicable federal and state income taxes, if any, resulting from the Westinghouse Granium Settlement as credited after the Closing Date. Vepco agrees to execute such title and release documents as are required by Section 16.04 hereof.

ARTICLE VIII Management of the Facilities; Liability and Allocation of Risk; and Contracts for the Facilities The provisions of Article VIII of the Purchase Agreement are incorporated herein by reference and shall apply as if set forth herein in full.

ARTICLE IX General Covenants The provisions of Article IX of the Purchase Agreement are

, incorporated herein by reference and shall apply as if set forth herein in full. >

ARTICLE X

. Waiver of Partition i.

The provisions of Article X.of the Purchase Agreement are incorporated herein by reference and shall apply as if set forth herein in full. -

a.

_f f

v t

- - -- --__.r.~ . , . , ,,. ---e, . . , - , _ . _ _ . _ . - , . . .- -.., ,_ y,.. ,..-_ ..., , .,w,-_,.__-m - , . - - - , , , .

ARTICLE XI Assignment The provisions of Article XI of the Purchase Agreement are incorporated herein by reference and shall apply as if set forth herein in full.

ARTICLE XII Insurance The provisions of Article XII of the Purchase Agreement are incorporated herein by reference and shall apply as if set forth herein in full.

ARTICLE XIII Destruction; Condemnation The provisions of Article XIII of the Purchass Agreement are incorporated herein by reference and shall apply as if set forth herein in full.

ARTICLE XIV

[ -

Force Majeure The provisions of Article XIV of the Purchase Agreement are l incorporated herein by reference and shall apply as if set forth herein in full.

ARTICLE XV Default The provisions of Article XV of the Purchase Agreement are incorporated herein by reference and shall apply as if set forth herein in full.

ARTICLE XVI Special Remedies The provisions of Article XVI of the Purchase Agreement are incorporated herein by reference and shall apply as if set forth herein in full.

For purposes of incorporation by reference herein of Article XVI of the Purchase Agreement, North Anna Unit 1 and North Anna Unit 2 shall include that portion of the Designated Nuclear Fuel used or to be used by that Unit. The old Dominion Percentage ownership Interest in the Undesignated Nuclear Fuel shall be adjusted by replacing the .116 in the formula in Section 7.02 hereof with the adjusted Old Dominion Percentage Ownership Interest in each Unit.

ARTICLE XVII Term of Agreement The provisions of Article XVII of the Purchase Agreement are incorporated herein by reference and shall apply as if set forth herein in full.

ARTICLE XVIII Accounting Matters The provisions of Article XVIII of the Purchase Agreement are incorporated herein by reference and shall apply as if set forth herein in full.

i

ARTICLE XIX Consultations and Mutual Cooperation; Authorized Representati Xes__

The provisions of Article XIX of the Purchasc Agieement are incorporated herein by reference and shall apply as if set forth herein in full. i ARTICLE XX Miscellaneous The provisions of Sectiona20.01 through 20.15 of the 1,

Purchase Agreement are incorporated herein by reference and shall apply as if set forth herein in full.

20.16 Equal Opportunity. During the performance of those parts of this Agreement relating to the construction by Vepco of any additions, betterments, improvements or replacements to the l Facilities, Old Dominion and Vepco agree as follows:

(i) The Parties will not discriminate against any employee or applicant for employment because of race, color, religion, sex, age or national origin. The Parties will take affirmative action to ensure that applicants are employed, and that employees are treated during employment without regard to their race, color, religion, sex, or national origin. Such action shall include, but not be limited to, the following: employment, upgrading, demotion or transfer; recruitment or recruitment advertising; layoff or termination; rates of pay or other forms of compensation; and selection for training, including apprenticeship. The Parties agree to post in conspicuous places, available to

employees and applicants for employment, notices to be provided setting forth the provisions of this Equal Opportunity Clause.

(ii) The Parties will, in all solicitations or advertisements for employees placed by or on behalf of either party, state that all qualified applicants will receive consideration for employment without regard to race, color, sex, or national origin.

(iii) The Parties will send to each labor union or representative of workers with which it has a collective bargaining agreement or other contract or understanding, a notice to be provided advising the said labor union or workers' representatives of the Parties commitments under this section, and shall post copies of the notice in conspicuous places available to employees and applicants for employment.

(iv) The Parties will comply with all provisions of Executive Order 11246, dated September 24, 1965, and of the rules, regulations and relevant order of the Secretary of Labor.

(v) The Parties will furnish all information and reports required by Executive Order 11246, dated September 24, 1965, and by rules, regulations and relevant orders of the Secretary of Labor, or pursuant thereto, and will permit access to their books, records and accounts by the administering agency and the Secretary of Labor for purposes 1

i 1

s . _ _

of investigation to ascertain compliance with such rules, regulations and orders.

(vi) In the event of either Party's noncompliance with the nondiscrimination clauses of this Agreement or with any of the said rules, regulations or orders, the Parties may be declared ineligible for further Government procedures authorized in Executive Order 11246, dated September 24, 1965, and such other sanctions may be imposed and remediec invoked as provided in said Executive Order or by rule, regulation or order of the Secretary of Labor, or as otherwise provided by law.

(vii) The Parties agree that, unless exempted by the rules, regulations or orders of the Secretary of Labor issued pursuant to Section 204 of Executive Order 11246, dated September 24, 1965, all subcontracts and purchase orders will cite that such contract or purchase orders are, subject to Executive Order 11246 and such provisions will be binding upon each subcontractor.or vendor. The Parties will take such action with respect to any subcontract or purchase order as the administering agency may direct as a means of enforcing such provisions, including sanctions for noncompliance; provided, however, that in the event either Party becomes involved in, or is threatened with, litigation with a subcontractor or vendor as a result of such direction by the administering agency, that Party may request the United States to enter into such litigation to protect the interests of the United States.

._. -. _~ - . - -

20.17 Environment. The Parties shall comply with (1) all applicable water and air pollution control standards imposed by federal or state statutes or regulations and (2) the provisions of any Environmental Impact Statement issued by the NRC with respect to the Facilities pursuant to the National Environmental Policy Act; and the Parties shall take all steps necessary to.

assure that all actions undertaken pursuant to this Agreement by the Parties or others under the control and/or direction of the Parties are in compliance with the provisions of this Section.

Nothing in this Section 20.17 shall be construed to prevent the Parties from resisting, challenging, contesting or appealing any ,

law, statute, regulation or decision of any federal, state or ,i local government or agency which the Parties claims to be  ;

invalid, unlawful, unreasonable, arbitrary or capricious.

20.18 Kick-backs. In the acquisition, construction and completion of the Facilities pursuant to this Agreement, the Parties shall comply with all applicable statutes, crdinances, rules, and regulations pertaining to the work. The Parties acknowledge that they are faciliar with the Rural Electrification ;

Act of 1936, as amended, the so-called Kick-Back Statute (48 Stat. 948), and regulations issued pursuant thereto, and 18 U.S.C. 287, 1001, as amended. The Parties understand that the obligations of the Parties are subject to the applicable regulations and orders of Governmental Agencies having jurisdiction over the Facilities.

20.19 Nonsegregated Facilities. The Parties certify that they do not maintain or provide for their employees any

segregated facilities at any of their establishments, and that they do not permit their employees to perform services at any location, under their control, where segregated facilities are maintained. The Parties certify further that they will not maintain or provide for their employees any segregated facilities at any of their establishments, and that they will not permit their employees to perform services at any location, under their control, where segregated facilities are maintained. The Parties agree that a breach of this certification is a violation of the Equal Opportunity Clause in this Agreement. As.used in this certification, the term " segregated facilities" means any waiting rooms, work areas, restrooms and washrooms, restaurants and other eating areas, timeclocks, locker rooms rad other storage or dressing areas, parking lots, drinking fountains, recreation or entertainment areas, transportation, and housing facilities provided for employees which are segregated by explicit directive or are in fact segregated on the basis of race, color, religion, or national origin, because of habit, local custom, or otherwise.

The Parties agree that (except where they have obtained identical certifications from proposed subcontractors for specific time periods) they will obtain identical certifications from proposed subcontractors prior to the award of subcontractors exceeding

$10,000 which are not exempt from the provisions of tire Equal Opportunity Clause, and that they will retain such certification in their files.

20.20 Confidentiality. During the term of this Agreement,

~

it may become necessary or desirable, from time to time, for one

i i

Party to provide to the other Party information which is either confidential or proprietary. The Party desiring to protect any such information (the labeling Party) may label such information as either confidential or proprietary and thereafter the other Party will not reproduce, copy, use or disclose (except when required by governmental authorities) any such information in whole or in part for any purpose without the written consent of the labeling Party. In disclosing confidential or proprietary information to governmental authorities, the disclosing Party shall cooperate with the labeling Party in minimizing the amount of such information ' furnished. At the specific request of the labeling Party, the other Party will endeavor to secure the ,

agreement of such governmental authorities to maintain specified portions of such information in confidence.

20.21 Historic Places. The Parties shall not, without approval in writing by the REA Administrator, use any portion of the funds made available to Vepco by Old Dominion pursuant to the terms of this Agreement to construct any facilities which will l involve any district, site, building, structure or object which l

is included in the National Register of Historic Places, l maintained by the Secretary of the Interior pursuant to the Historic Sites Act of 1935 and the National Historic Preservation Act.

20.22 Public Officials Not to Benefit. No member of or delegate to the Congress of the United States shall be admitted to any share or part of this Agreement or to any benefit to arise herefrom other than the receiving of electric service en the same l

T terms accorded other consumers and other than benefits, if any such person is a Vepco shareholder, that may accrue to Vepco shareholders generally.

20.23 Flood Insurance Act. Notwithstanding anything contained in this Agreement, neither Party shall be under any obligation to advance any funds to the other Party to finance the construction or acquisition of any building in any area heretofore identified by the Secretary of Housing and Urban Development pursuant to the Flood Disaster Protection Act of 1973 (the " Flood Insurance Act") or any rules, regulations or orders issued to implement the Flood Insurance Act (" Rules"), as an area having special flood hazards, or to finance any facilities or ,

materials to be located in any such building, or in any building owned or occupied by Vepco or Old Dominion located in su2h flood hazard area unless and until there have been compliance with all other conditions of this Agreement which are precedent to such advances, and the REA Administrator has determined, that (i) the community in which such area is located is then participating in the national flood insurance program, as required by the Flood Insurance Act and any Rules and (ii) Vepco and Old Dominion have obtained flood insurance coverage with respect to such building and contents as may then be required pursuant to the Flood Insurance Act and any Rules.

20.24 Safety. In the acquisition, construction and completion of the Facilities pursuant to this Agreement, the Parties shall at all times take all reasonable precautions for the safety of employees at the Facilities and of the public at

the Facilities, and shall comply with all applicable provisions of Federal, State and Municipal safety laws and building and construction codes, including without limitation, all regulations of the Occupational Safety and Health Administration.

20.25 Buy American. The Parties covenant that in the performance of this contract (1) at least Old Dominion's Percentage Ownership Interest in the total cost of the Facilities, including the total of all of the unmanufactured articles, materials and supplies used or to be used in the construction of or otherwise made a part of the Facilities shall have been mined or produced in the United States and (2) at least Old Dominion's Percentage Ownership Interest in the total cost of the Facilities, including the total cost of all of the manufactured articles, materials, and supplies used or to be used in the construction of or otherwise made a part of the Facilities shall have been manufactured in the United States substantially all from articles, materials, or supplies mined, produced, or manufactured, as the case may be, in the United States. If any article, material, or supplies are partially mined, produced, or manufactured in the United States (said part being hereinafter called the "American Made Portion") and partially mined, produced, or manufactured somewhere other than in the United States, then only the cost of the American Made Portion shall be used in determining whether the requirements of the preceding sentence have been satisfied. At the Closing and from time to time thereafter when requested by Old Dominion or the REA Administrator, the Parties shall supply the REA Administrator or l

i l

the party so requesting with information and documentation h demonstrating that the Facilities were constructed in accordance i

with the requirements of this Section.

20.26 Merger of Documents. All understandings and agreements, written or oral, among the Parties prior to October 17, 1983, with respect to the matters herein contained, including l

the Principles for Agreement, dated October 20, 1981, and the Nuclear Fuel Agreement, between Vepco and Old Dominion, executed on December 28, 1982 and the Nuclear Fuel Agreement dated as of December 28, 1982, but executed on March 4, 1983 (the " Original Nuclear Fuel Agreements") have been superceded in all respects by this Nuclear Fuel Agreement, dated as of December 28, 1982, but ,

amended and restated on October 17, 1983, a'd all uuch understandings and agreements prior to October 17, 1983, including the Principles for Agreement and the Original Nuclear Fuel Agreements, are null and void and of no effect whatsoever.

IN WITNESS WHEREOF, the Parties have hereto caused this

)

, amended and restated Agreement to be signed and sealed as of i October 17, 1983, by their duly authorized representatives.

VIRGINIA ELECTRIC AND POWER COMPANY By I' L)

William W. Berry President Attest:

/41 .

Linwood R. Robertson Corporate Secretary OLD DOMINION ELECTRIC COOPERATIVE By Y bh Harry K. Bowman President Attes .

1. /u- ~

James'M. Rey lds Secretary e

- . - + -a - , _ _ _ _-

, - - - - - ,y-- - , , _ - - - - y 9 -

n , , .., ,

STATE OF VIRGINIA:

to-wit:

CITY OF RICHMOND The foregoing instrument was acknowledged before me this

,17th day of October 1983 by William W. Berry and Linwood R.

Robertson, President and Corporate Secretary, respectively, of Virginia Electric and Power Company, a Virginia corporation, on behalf of the corporation.

My commission expires: [/ s .s i. 4 -? O / @ b '

b*nnu.Notary S ld~t &

Public

{ SEAL} -

f l Y; e

h e

l l

l t

. . - ~ . . _ . - . . , , , , . . - , , , _ - _ _ . . - , - - , _ . , _ , - _ , , , _

STATE OF VIRGINIA:

to-wit:

CITY OF RICHMOND:

The foregoing instrument was acknowledged before me this 17th day of October 1983 by Harry K. Bowman and James M.

Reynolds, President and Secretary, respectively, of Old Dominion Electric Cooperative, a Virginia cooperative, on behalf of the cooperative.

My commission expires: [ 3 4,'[ D,7 /fec'

/

A/?/ f i- a k k st-c h Notary Public

[ SEAL]

Page 1 of 1 EXHIBIT A The Nuclear Fuel All property of Vepco appearing in the following accounts of vepco's books of account that is within the definition of the Nuclear Fuel as well as the Construction Work in Progress and.the Completed Construction Not Classified, if any, related thereto:

FERC Account Description 120.1 Nuclear Fuel in Process of Refinement, Conversion, Enrichment and Fabrication 120.2 Nuclear Fuel Material Stock Account 120.3 & 120.4 Nuclear Fuel Assemblies in Reactor, Spent Nuclear Fuel

• Herein defined as Undesignated Nuclear Fuel I

l _ - . _- .. - _ - _ _

Paga 1 of 2 EXHIBIT B Nuclear Fuel Contracts

1. Uranerzbergbau - GmbH mit Sitz in Bentheim; Agreement for Sale and Purchase of Uranium Concentrates; Vepco Contract Number 9389 dated August 25, 1981 (purchase of natural uranium as U0 38 f r delivery in 1982 and 1983).

2. Exxon Nuclear Company, Inc.; Agreement for Sale of Uranium Concentrates; Vepco Contract Number 9388 dated September 9, 1981 (purchase of natural uranium as U 38 0 f r delivery in 1982 and 1983).

Westinchouse Electric Corporation; Agreement for Uranium Supply; 'hpco Contract Number 8696.4 dated June 22, 1979, as amended by Amendment Number 1 dated August 29, 1980 (purchase of natural uranium as U 38 0 f r delivery in 1980 through 1394).

4. Allied Chemical Corporation; UF, Conversion AgreeNent; Vepco Contract Number 8487 dated May 24, 1978, as amended December 5, 1980 (furnishing of uranium conversion services from 1978 through 1987).

5. Kerr-McGee Nuclear Corporation; Uranium Conversion AgredMEnt; Vepco Contract Number 8343 dated October 21, 1977 (furnishing of uranium conversion services from 1977 through 1985).

6 Department of Energy; Agreement for Furnishing Uranium EnricEkentServices (Requirements) ; Vepco Contract Number 6770; DOE Contract Number DE-SC05-72UE04426; dated December 11, 1972 (furnishing of uranium enriching services through 2003).

7. Westinghouse Electric Corporation; Fuel Fabrication ContrTET for North Anna Unit Number 1 and Unit Number 2 Power Station; Vepco Contract Number 6005 dated January 31, 1974, as amended by Amendment No. 1, dated July 21, 1975, Amendment No. 2, dated December 31, 1977 and Amendment No. 3, dated June 22, 1979 (supply of nuclear fuel and associated services).

O

Exhibit B Page 2 of 2

,g, Westinghouse Electric Corporation; Burnable Poison Rod Assembly Supply Contract for North Anna Unit No. 1 and Unit No.

2; Vepco Contract Number 8696.5, dated June 22, 1979 (supply of burnable poison rod assemblies from 1979 through 1995).

9. Transnuclear, Inc.; Contract for Spent Fuel Transportation Services and Equipment; Vepco Contract Number 9645 dated June 1, 1982 (supply of services and equipment for spent fuel transportation tnrough 1991).

A

10. GPU Service Corporation; Agreement Between Virginia' ElecEEIc and Power Company and Metropolitan Edison Company for the Supply of Uranium; Vepco Contract Number 9794 dated December 27, 1982 (purchase of natural uranium as U 0 delivery in 1983). 38 f UF6'#

11. Department of Energy; Agreement for Delivery of Natural UF6; DOE Contract No. E-(40-1)-4961; Vepco Contract No. 8079, dated October 9, 1975 (Storage of natural UF6).

12. Department of Energy; Storage Agreement (DOE Contract No. E-(40-1)-4994 ; Vepco Contract No. 8080, dated October 31, 1979 (Storage of Enriched Uranium Product).

13. Department of Energy Disposal (Spent Fuel) Contract (DOE Contract Number DE-CRO1-83NE44423); Vepco Contract No. 9909; dated June 15, 1983.

14. Societe Auxiliaire D'Energie; Agreement for Sale of SWUs; Vepco Contract number 9976 dated August 30, 1983. (one time supply of uranium enriching. services during 1983)

15. Energy Resources of Australia Ltd.; Agreement for the Supply of Natural Uranium between Virginia Electric and Power Company and Energy Resources of Australia Ltd.; Vepco Contract Number pending approval of agreement by Australian government; dated August 22, 1983 (purchase of natural uranium as U308 for delivery at least in 1985 through 1990) .

l i

Page 1 of 5 EXHIBIT C Form of Bill of Sale THIS BILL OF SALE, dated as of the day of

, 1983, between VIRGINIA ELECTRIC AND POWER COMPANY, a Virginia public service corporation ("Vepco"), and OLD DOMIN-ION ELECTRIC COOPERATIVE, a Virginia generation and transmis-sion cooperative ("Old Dominion"), recites and provides as fol-lows:

RECITALS:

1. By a Purchase, Construction and Ownership Agreement dated as of December 28, 1982, but amended and restated on October 17, 1983 (the " Purchase Agreement"), between Vepco and Old Dominion, Vepco agreed to sell certain real and personal property to Old Dominion.

2. Pursuant to the Purchase Agreement and simulta-neously with'the delivery of this agreement, Vepco has conveyed l

l to Old Dominion by a deed dated t

, 1983 (the

" Deed"), an 11.5 percent undivided interest in a tract or par-cel of land located in the Counties of Louisa, Orange and l

Spotsylvania, Virginia, known as the North Anna Nuclear Power Station.

3. By a Nuclear Fuel Agreement dated as of December 28, 1982, but amended and restated on October 17, 1983 (the " Fuel Agreement"), between Vepco and Old Dominion, Vepco

EXHIBIT C Page 2 of 5 agreed to sell certain nuclear fuel for the North Anna Nuclear Power Station to Old Dominion.

4. The Purchase Agreement and the Fuel Agreement to-gether with an Interconnection and Operating Agreement dated as of December 28, 1982, but amended and restated on October 17, 1983, between Vepco and Old Dominion are attached to the Deed and recorded therewith in the Clerk's Office of the Circuit Court of the Counties of Louisa, Orange and Spotsylvania, Virginia.

5. Pursuant to the Fuel Agreement, Vepco now desires to sell, convey and transfer to Old Dominion an undivided per-

~

centage interest in the hereinafter described tangible personal property.

AGREEMENT:

NOW, THEREFORE in consideration of the sum of Ten Dol-lars ($10.00), the premises contained herein and other good and l

l valuable consideration, the receipt and sufficiency of which are hereby acknowledged, Vepco, subject to the matters herein-after set forth, hereby sells, transfers, grants, sets over, conveys and assigns to Old Dominion the undivided percentage interest of all the right, title, interest, estate and benefit of Vepco in and to the personal property listed on the attached Exhibit A, including the Old Dominion Nuclear Fuel (collective-ly, the " Fuel"), that is equal to the undivided percentage amount designated on Exhibit A for the affected component of the Fuel.

A

EXHIBIT C Page 3 of 5 The sale and transfer of the Fuel to Old Dominion is expressly subject to the provisions for Waiver of Partition set forth in Article X of the Fuel Agreement and all exceptions, reservations, easements, waivers, conditions, licenses, re-strictions, encumbrances, covenants, agreements, limitations and waivers that may apply to the Fuel or any portion or part thereof, including but not limited to, the provisions of the Basic Agreements.

Old Dominion has joined in the execution hereof to evi-dence that it hereby (i) assumes its proportionate share of all the duties and obligations arising from or in any way related to the ownership of the Fuel that is equal to Old Dominion's Percentage Ownership Interest from time to time (aggregated, if necessary) in the affected component of the Fuel and (ii) agrees to fully perform all such duties and obligations. -

Terms defined in the Fuel Agreement, but not otherwise defined herein are used as defined therein.

The provisions of this Bill of Sale shall inure to the benefit of and be binding upon the successors and assigns of the parties hereto.

EXHIBIT C Page 4 of 5 IN WITNESS WHEREOF, Vepco and Old Dominion have caused this Bill of Sale to be executed in their names by their duly authorized corporate officers.

VIRGINIA ELECTRIC AMD POWER COMPANY a Virginia public service corporation By:

Vice Prasident

[ SEAL]

Attest:

Assistant Corporate Secretary OLD DOMINION ELECTRIC COOPERATIVE, a Virginia generation and transmission cooperative By:

President

[ SEAL]

Attest:

Secretary

I EXHIBIT C l Page 5 of 5 EXHIBIT A TO BILL OF SALE DATED AS OF , 1983 BETWEEN VEPCO AND OLD DOMINION

[ Nuclear Fuel]

Description of , Percentage Items of Personal Amount Sold Property to Old Dominion i

l l

l l

l l - - - - - - - ' ~ ~ ' - - " - ~ ' ' ' ~ ~ ' ' " ^

h Page 1 of 6 EXHIBIT D Form of Assignment Agreement THIS ASSIGNMENT AGREEMENT, dated as of the day of , 1983, between VIRGINIA ELECTRIC AND POWER COM-PANY, a Virginia public service corporation ("Vepco"), and OLD DOMINION ELECTRIC COOPERATIVE, a Virginia generation and trans-mission cooperative ("Old Dominion"), recites and provides as fol '_ows :

RECITALS:

1. By a Purchase, Construction and Ownership Agree-ment dated as of December 28, 1982, but amended and restated on October 17, 1983 (the " Purchase Agreement"), between Vepco and Old Dominion, Vepco agreed to sell certain real and personal property to Old Dominion.

2. Pursuant to the Purchase Agreement and simulta-neously with the delivery of this agreement, Vepco has conveyed to Old Dominion by a deed dated , 1983 (the

" Deed"), an 11.6 percent undivided interest in a tract or par-cel of land located in the Counties of Louisa, Orange and Spotsylvania, Virginia, known as the North Anna Nuclear Power Station.

EXHIBIT D Page 2 of 6

3. By a Nuclear Fuel Agreement dated as of December

' 28, 1982, but amended and restated on October 17, 1983 (the

" Fuel Agreement") between Vepco and Old Dominion, Vepco agreed to assign to Old Dominion a percent share of the rights, duties and oblic;ations under certain contracts, including the Nuclear Fuel Contracts.

4. The Purchase Agreement and the Fuel Agreement to-gether with an Interconnection and Operating Agreement dated as of December 28, 1982, but amended and restated on October 17, 1983, between Vepco and Old Dominion are attached to the Deed and recorded therewith in the Clerk's Office of the Circuit Court of the Counties of Louisa, Orange and Spotsylvania, Virginia.

5. Pursuant to the Fuel Agreement, Vepco now desires

~

to sell and assign to Old Dominion an undivided percentage in-terest in the hereinafter described intangible personal proper-ty.

I j ASSIGNMENT AGREEMENT:

NOW, THEREFORE, for and in consideration of the sum of Ten Dollars ($10.00), the premises contained herein and other good and valuable consideration, the receipt and sufficiency of I which are hereby acknowledged, Vepco, subject to the matters hereinafter set forth, hereby sells, transfers, grants, sets over, conveys and assigns to Old Dominion a percent undivided interest in and to all right, title, interest, estate and l

[

EXHIBIT D Page 3 of 6 l

benefit of Vepco in, to and under the contracts set forth on the attached Exhibit A (the " Fuel Related Contracts") that is equal to Old Dominion's Percentage Ownership Interest (aggre-gated, if necessary) in the component of the Facilities affect-ed by such Fuel Related Contract (s).

The Fuel Related Contracts are expressly assigned sub-ject to the provisions for Waiver of Partition set forth in Ar-ticle X of the Fuel Agreement and all exceptions, reservations, easements, waivers, conditions, licenses, restrictions, encum-brances, covenants, agreements, limitations and waivers that may apply to the Fuel Related Contracts or any portion or part I thereof, including but not limited to, the provisions of the Basic Agreements.

1 Old Dominion has joined in the execution hereof to evi-dence that it hereby (1) accepts this assignment, (ii) assumes ,

a proportionate share of all the duties and obligations under the Fuel Related Contract (s) that is equal to Old Dominion's Percentage Ownership Interest (aggregated, if necessary) in the component of the Facilities affected by such Fuel Related Con-tract (s), (iii) agrees to fully perform its proportionate share of all such duties and obligations and (iv) agrees to faithful-ly observe and comply with all confidentiality provisions and all other similar restrictions relating to the protection of proprietary information contained in the Fuel Related Con-tract (s).

EXHIBIT D Page 4 of 6 Terms defined it the Fuel Agreement and not otherwise defined herein are used as defined therein.

The provisions of this Assignment Agreement shall inure to the benefit of and be binding upon the successors and as-signs of the parties hereto.

IN WITNESS WHEREOF, Vepco and Old Dcminion have caused this Assignment Agreement to be executed in their respective corporate names by their duly authorized corpcrate officers.

VIRGINIA ELECTRIC AND POWER COMPANY, a Virginia public service corporation By:

Vice President (SEAL]

Attest:

Assistant Corporate Secretary OLD DOMINION ELECTRIC COOPERATIVE, a Virginia generation and transmission cooperative By:

President l [ SEAL)

Attest:

l Secretary ~

l

EXHIBIT D Page 5 of 6 EXHIBIT A TO ASSIGNMENT AGREEMENT DATED AS OF , 1983, BETWEEN VEPCO AND OLD DOMINION

1. Uranerzbergbau - GmbH mit Sitz in Bentheim; Agree- ~

ment for Sale and Purchase of Uranium Concentrates; Vepco Contract Number 9389 dated August 25, 1981 (purchase of natural uranium as U308 for delivery in 1982 and 1983).

2. Exxon Nuclear Company, Inc.; Agreement for Sale of Uranium Concentrates; Vepco Contract Number 9388 dated September 9, 1981 (purchase of natural urani-um as U308 for delivery in 1982 and 1983).

3. Westinghouse Electric Corporation; Agreement for Uranium Supply; Vepco Contract Number 8696.4 dated June 22, 1979, as amended by Amendment Number 1 dated August 29, 1980 (purchase of natural uranium as U308 for delivery in 1980 through 1994).

4. Allied Chemical Corporation; UF6 Conversion Agree-ment; Vepco Contract Number 8487 dated !!ay 24, 1978, as amended December 5, 1980 (furnishing of uranium conversion services from 1978 through 1987).

l

5. Kerr-McGee Nuclear Corporation; Uranium Conversion Agreement; Vepco Contract Number 8343 dated October 21, 1977 (furnishing of uranium conversion services from 1977 through 1985).

6. Department of Energy; Agreement for Furnishing Ura-nium Enrichment Services (Requirements); Vepco Con-tract Number 6770; DOE Contract Number DE-SC05-72UE04426; dated December 11, 1972 (fur-nishing of uranium enriching services through 2003).

1

7. Westinghouse Electric Ccrporation; Fuel Fabrication Contract for North Anna Unit Number 1 and Unit Num-ber 2 Power Station; Vepco Contract Number 6005 dated January 31, 1974, as amended by Amendment No.

1, dated August 25, 1976, Amendment No. 2, dated December 31, 1977.and Amendment No. 3, dated June 22, 1979 (supply of nuclear fuel and associated services).

- - - - ~ - , - - - - - - - - - , - .-

- --. - , - - , , - .-,w, e--_--- , ,,,i.m - , , . . - - ---.,y,, -

. , . - - , , - - , - ..,,w , .,,-, ,, ---,-

EXHIBIT D Page 6 of 6

8. Westinghouse Electric Corporation; Burnable Poison

' Rod Asr,embly Supply Contract for North Anna Unit No. 1 and Unit No. 2; Vepco Contract Number 8696.5, dated June 22, 1979 (supply of burnable poison rod assemblies from 1979 through 1995).

9. Transnuclear, Inc.; Contract for Spent Fuel Trans-portation Services and Equipment; Vepco Contract Number 9645 dated. June 1, 1982, as amended by Amendment No. 1 dated December 22, 1982 and Amend-ment No. 2 dated June 24- 1983 (supply of services and equipment for spent fuel transportation through 1991).

20.,GPU Service Corporation; Agreement Between Virginia Electric and Power Company and Metropolitan Edison Company for the Supply of Uranium; Vepco Contract Number 9794 dated December 27, 1982 (purchase of natural uranium as U308 of UF6 for delivery in 1983),

~

11. Department of Energy; Agreement for Delivery of Natural UF6 (DOE Contract E-(40-1)-4961); Vepco Contract No. 8079; dated October 9, 1975 (Storage of natural UF6).

12. Department of Energy; Storage Agreement (DOE Con-tract No. E(40-1)-4994); Vepco Contract No. 8080; dated October 31, 1975 (Storage of Enriched Uraninm Product).

13. Department of Energy Disposal (Spent Fuel) Contract (DOE Contract Number DE-CR01-83NE44423); Vepco Con-tract Number 9909; dated June 15, 1983.

14. Societe Auxiliarie D'Energie; Agreement for Sale of SWUs; Vepco Contract Number 9976 dated August 30, 1983 (one time supply of uranium cnriching services during 1983).

15. Energy Resources of Australia Ltd.; Agreement for the Supply of' Natural Uranium between Virginia Electric and Power Company and Energy Resources of Australia Ltd.; Vepco Contract Number pending ap-proval of agreement by Australian government; dated August 22, 1983 (purchase of natural uranium as U309 for delivery at least in 1985 through 1990).

4

Page 1 of 3 EXHIBIT E ,

Total Payment at Closing Nuclear Fuel Old Dominion Ownership Interest Old Dominion Portion of Nuclear Fuel (Schedule 1) $

Tax Liability at Closing (Schedule 2)

(1) TOTAL DUE AT CLOSING $

(2) TOTAL PAYMENT DUE 'JNDER SECTION 3.01 $

(3) DIFFERENCE DUE (2-1) $

The Parties agree that the Total Payment Due 6t Closing will be an estimate calculated as of the Closing Date. When actual amounts are available, the Total Payment Due Under Section 3.01 shall be calculated as of the Closing Date for record pur' poses. Ady difference will be paid to the appropriate party within 30 days of written notice of the Difference Due.

CALCILATION OF OLO DO"41NION PORTION OF NUCLEAR FUEL (1) (2) (3) (4) (5)

Gross Book Westfrg se Book Old Dominion Uis tentalon Unit Value Settlement Burn Value Percentage Portion 120.1 Nuclear Fuel in Process of Refinement, Conversion, Enrichment and Fabrfcation l 120.2 Nuclear Fuel Material Stock Account (Undesig-noted Nuclear Fuel) 120.3 8 120.4 Nuclear Fuel Assemblies

'l in Reactor, Spent Nuclear

Fuel 1

] TOTAL 4

4 9

M5 i

kn*"

mo,m

. Gd 4

1

EXHIBIT E Page 3 of 3 Schedule 2 Tax Liability at Closing .

Nuclear Fuel

~

Gross Book Value (Nuclear Fuel) $

Less: Allowance For Funds Used During Construction Westinghouse Credit Insurance on Transportation Property Taxes Capitalized Tax Depreciable Additions $

Less: Tax Depreciation Tax Basis $

I. Gross Up of Tax Consequences A, Tax Consequences

- Federal Ordinary Tax $

- N. C. State Income Tax

- W. VA State Income Tax " -

B. Gross Up for Additional Tax $_,_.

II. Proof of Additive Factor A. Purchase Price Before Additive Factor for Tax $

B. Additive Factor from I-B C. Total Purchase Price D. Less: Depreciated Tax Basis E. Total Gain on Sale F. N. C. State Income Tax G. W. VA State Income Tax

$* h kaf Ta e! " $

9

- - . - - , . , - - , _ - - . , - . , , , . . , . --.,_,-,-,_..._,,--y . - - * ---,_____,,y- .-_,,,

EXHIBIT F Page 1 of 10 Schedule 1 Page 1 of 1, Share of New Investment Nuclear Fuel Month of 19 Nuclear Fuel Undesignated Fuel (Schedule 1-A) $

Undesignated Westinghouse Credit (Schedule 1-B)

Allocation Adjust. Surry (Schedule 1-C)

Allocation Adjust. North Anna (Schedule 1-D)

Designated Fuel (Schedule 1-E)

Westinghouse Adjust. Surry (Schedule 1-F)

Westinghouse Adjust. North Anna (Schedule 1-G)

DDE Quarterly Payment (Schedule 1-H) .

Sub Total ,

Interest on Unpaid Invoices (Schedule 1-I)

Total on Nuclear Fuel $

I O

EXHIBIT F Page 2 of 10 Schedule 1-A Page 1 of 1 o

Monthly Budgeted / Actual New Investment Month of 19 Adjustment (1) (2) (3) (4) (5)

Undesignated 19 19 19 Diffemnce Nuclear Fuel ( A) Budget Actual Estimated (2-3) Total Total Undesignated Fuel $ __

(Surry and North Anna)

Old Dominion Purchase Ratio (B) 6.1714%

, Old Dominion Sham of Undesignated Nuclear Fuel $

l

( ) Denotes Cmdit

( A) Includes only charges applicable to uranium and conversion costs.

~

(B) Detennined in accordance with Section 7.02 of the Nuclear Fuel Agmement.

l l

I

EXHIBIT F Page 3 of 10 Schedule 1-B Page 1 of 1  ;

i Monthly Budgeted / Actual New Investment Month of 19

. Adjustment I (1) (2) (3) (4) (5)

Undesignated 19 19 19 Difference Westinghouse Credit (A) Budget Actual Estimated (2-3) Total Total Undesignated Westinghouse Credit ,

(Surry and North $ $ $ $ $

Anna)

Old Dominion Purchase Ratio (B) 6.1714% ,

Old Dominion Share of Undesignated Westinghouse Credit $

i l

l ( ) Denotes Credit l

l (A) The Westinghouse Credit to Old Dorainion includes a portion of recovery I applicable to Surry and will be adjusted for actual North Anna recovery by Schedule 1-D when fuel is allocated to batch.

(B) Determined in accordance with Section 7.02 of the Nuclear Fuel Agreement.

4 ,

9

EXHIBIT F Page 4 of 10 Schedule 1-C Page 1 of 1 Monthly Budgeted / Actual New Investment Month of 19 Adjustment

, (1) (2) (3) (4) (5)

Surry Allocation 19 19 19 Difference To Batch Budget Actual Estimated (2-3) Total Nuclear Fuel $ $ $ $ $

l Old Dominion Purchase Ratio (A) 6.1714%

Old Dominion Share of

Surry 8atch $

l l Estimated Westinghouse Credit $ $ $ $ $

Old Dominion Purchase Ratio (A) 6.1714%

Old Dominion Share of Est. Westinghouse Credit (B) l l

Net Allocation to Surry $

( ) Denotes Credit (A) Detemined in accordance with Section 7.05 of the Nuclear Fuel Agreement.

(B) Will be adjusted for actual when batch is placed in the reactor (See Schedule 1-F). ,

'N _- .. _ - .- _-.

EXHIBIT F Page 5 of 10 Schedule 1-D Page 1 of 1 Monthly Budgeted / Actual New Investment Month of 19 Adjustment (1) (2) (3) (4) (5)

North Anna Allocation 19 19 19 Difference To Batch Budget Actual Estimated (2-3) Total Nuclear Fuel $ $ $ $ $

Old Dominion Purchase Ratio (A) 5.4286%

Old Dominion Share of

( North Anna Batch Est. Westing-house Credit $ $ $ $ $ __

Old Dominion Purchase Ratio (A) 5.4286%

Old Dominion Share of Est. Westing-house Credit (B) l $

Net Allocation to North Anna $

l ( ) Denotes Credit 1

(A) Determined in accordance with Section 7.05 of the Nuclear Fuel Agreement.

(B) Will be adjusted for actual when batch is placed in the reactor (See Schedule l 1-G).

l l

EXHIBIT F Page 6 of 10 Schedule 1-E Page 1 of 1 Monthly Budgeted / Actual New Investment Month of 19 Adjustment (1) (2) (3) (4) (5)

Designated 19 19 19 Differerce Nuclear Fuel ( A) Budget Actual Estin.ated (2-3) Total Total Designated Fuel $ $ $ $

(N. A. Only)

Old Dominion Purchase Ratio (B) 11.6%

Old Dominion Share of Designated Fuel $

l

( ) Denotes Credit (A) Includes only chanjes applicable to enrichment, fabrication, and miscellaneous batch costs.

(B) Unless adjusted pursuant to Nuclear Fuel Agreement.

l l

l

EXHIBIT F Page 7 of 10 Schedule 1-F Page 1 of 1 l Monthly Budgeted / Actual New Investment Month of 19 l Nuclear Fuel -

Actual Westinghouse Damages Adjustment l (1) (2) (3) (4)  ;

Adjustment to ,

Surry Batch Placed Estimated Damages Apply to In-Service in Month of Applied to Previous Actual 19 Billing 19 Billing (A) Damages (2-3) i Old Dominion Purchase Ratio (B) 6.1714%

Old Dominion Share '

of Damages $

i

( ) Denotes Credit (A) Original estimate previously provided on Schedule 1-C.

l 1

(B) Detennined in accordance with Section 7.05 of the Nuclear Fuel Agreement.

f Note: Please note that if no batches are placed in the reactor, then there I

will be ro actual damage adjustment for that month.

l o

EXHIBIT F Page 8 of 10 Schedule 1-G Page 1 of 1 Monthly Budgeted / Actual New Investment Month of 19 Nuclear Fuel ,

Actual WestinghcJse Damages Adjustment i 6

(2) (3) (4) f (1)

Adjustment to North Anna Batch Placed Estimated Damages Apply to i In-Service in Month of Applied to Previous Actual 19 Billing i 19 Billing (A) Damages (2-3) l 1

l I

Old Dominion j Purchase Ratio (B) 5.4286% .

l Old Dominion Share i

$ U of Damages

( ) Denotes Credit (A) Original estimate previously provided on Schedule 1-D.

(B) Determined in accordance with Section 7.05 of the Nuclear Fuel Agreement.

Note: Please note that if no batches are placed in the reactor, then there will be no actual damage adjustment for that month.

- .- - , --- c - . - - - - - - . . . , - - - - - - - - . , - - . - - - - - - - --

i 1

EXHIBIT F Page 9 of 10 Schedule 1-H Page 1 of 1 Monthly Budgeted / Actual New Investment Month of 19 Adjustment (1) (2) (3) (4) (5)

DOE Quarterly 19 19 19 Difference Payment (A) Budget Actual Estimated (2-3) Total Total North Anna $ $ $ $ $

Old Dominion Purchase Ratio (B) 11.6%

Old Dominion Share of DOE Quarterly Payment $

( ) Denotes Credit (A) The quarterly payment for fuel disposal costs shall be determined in accordance with the Nuclear Waste Policy Act of 1982. Such payment shall only apply to nuclear fuel amortized (burned) af ter closing.

(B) Unless adjusted pursuant to Nuclear Fuel Agreement.

y

u 0

EXHIBIT F Page 10 of 10 Schedule 1-1

, Page 1 of 1 Interest Calculation on i Adjustment to Actual j For the Month of 19 j Type of Actual to Budget Old Dominion Old Dominion's  !

Investment Difference  % Ownership (A) Prorata Share h

Nuclear Fuel  !

Schedule 1-A 6.1714%' ( A) I Schedule 1-B 6.1714% (B)  !

Schedule 1-C 6.1714% (B)  ;

Schedule 1-D 5.4286% (B) 1 Schedule 1-E 11.6%

Schedule 1-F 6.1714% (B)  !

Schedule 1-G 5.4286% (B) l Schedule 1-H 11.6% i Total Adjustment Interest at for /365 Days $

s (A) Determined in accordance with Section 7.02 of the Nuclear Fuel Agreement.

(B) Determined in accordance with Section 7.05 of the Nuclear Fuel Agreement.

_ _ _ _ _ _ _ _ _ - _ .