Dominion Power 2000 Annual Report Download - page 58

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Notes to Consolidated Financial Statements (continued)
At December 31, 2000 and 1999, the Company had aggregate
notional principal amounts of interest rate swaps on outstanding
debt of $1.5 billion and $600 million, respectively, maturing between
March 2002 and October 2023. The impact of the interest rate swaps
on interest expense and on the Company’s effective borrowing rates
in 2000, 1999 and 1998 was not significant.
Maturities (including sinking fund obligations) through 2005 are
as follows (in millions): 2001-$336; 2002-$1,658; 2003-$843; 2004-
$1,314 and 2005-$858.
In January 2001, Dominion issued $1.0 billion of 2-year fixed
rate 6% notes. In addition, in February 2001, Dominion issued
$50 million in aggregate principal amount of Tax-Exempt Pollution
Control Revenue Bonds due 2031.
Note 17 Obligated Mandatorily Redeemable
Preferred Securities of Subsidiary Trusts
In December 1997, Dominion established Dominion Resources
Capital Trust I (DR Capital Trust). DR Capital Trust sold 250,000
Capital Securities for $250 million, representing preferred benefi-
cial interests and 97% beneficial ownership in the assets held by
DR Capital Trust. Dominion issued $258 million of 7.83% Junior
Subordinated Debentures (Debentures) in exchange for the $250
million realized from the sale of the Capital Securities and $8 mil-
lion of common securities of DR Capital Trust. The common securi-
ties represent the remaining 3% beneficial ownership interest in
the assets held by DR Capital Trust. The Debentures constitute
100% of DR Capital Trust’s assets.
In 1995, Virginia Power established Virginia Power Capital Trust I
(VP Capital Trust). VP Capital Trust sold 5 million preferred securi-
ties for $135 million, representing preferred beneficial interests and
97% beneficial ownership in the assets held by VP Capital Trust.
Virginia Power issued $139 million of its 1995 Series A, 8.05%
Junior Subordinated Notes (the Notes) in exchange for the $135
million realized from the sale of the preferred securities and $4 mil-
lion of common securities of VP Capital Trust. The common securi-
ties represent the remaining 3% beneficial ownership interest in
the assets held by VP Capital Trust. The Notes constitute 100% of
VP Capital Trust’s assets.
In January 2001, Dominion established Dominion Resources
Capital Trust II (DR Capital Trust II) and Dominion Resources Capital
Trust III (DR Capital Trust III). DR Capital Trust II sold 12 million Trust
Preferred Securities for $300 million, representing preferred benefi-
cial interests and 97% beneficial ownership in the assets held by
DR Capital Trust II. Dominion issued approximately $309 million of
8.4% Junior Subordinated Debentures due 2041 in exchange for the
$300 million realized from the sale of the preferred securities and
approximately $9 million of common securities of DR Capital Trust II.
The Debentures constitute 100% of DR Capital Trust II’s assets. DR
Capital Trust III sold 250,000 Capital Securities for approximately
$247 million, representing preferred beneficial interests and 97%
beneficial ownership in the assets held by DR Capital Trust III.
Dominion issued approximately $258 million of 8.4% Junior
Subordinated Debentures due 2031 in exchange for the $247 million
realized from the sale of the capital securities and approximately $8
million of common securities of DR Capital Trust III. The common
securities represent the remaining 3% beneficial ownership in the
assets held by DR Capital Trust III. The Debentures constitute 100%
of DR Capital Trust III’s assets.
Note 18 Preferred Stock
Dominion is authorized to issue up to 20 million shares of preferred
stock; however, no such shares are issued and outstanding.
Virginia Power is authorized to issue 10 million shares of pre-
ferred stock, $100 liquidation preference. Upon involuntary liquida-
tion, dissolution or winding-up of Virginia Power, each share is
entitled to receive $100 per share plus accrued dividends. Dividends
are cumulative. During 2000, the following series of preferred stock
subject to mandatory redemption matured:
•400,000 shares of the $5.58 Series of Preferred Stock matured
on March 1, 2000; and
•1,400,000 shares of the $6.35 Series of Preferred Stock matured
on September 1, 2000.
There were no redemptions of preferred stock in 1999.
At December 31, 2000, preferred stock not subject to mandatory
redemption, $100 liquidation preference, included:
Issued and Entitled Per
Outstanding Share Upon
Dividend Shares Redemption
$5.00 106,677 $112.50
4.04 12,926 102.27
4.20 14,797 102.50
4.12 32,534 103.73
4.80 73,206 101.00
7.0 5 500,000 105.00(1)
6.98 600,000 105.00(2)
MMP 1/87(3) 500,000 100.00
MMP 6/87(3) 750,000 100.00
MMP 10/88(3) 750,000 100.00
MMP 6/89(3) 750,000 100.00
MMP 9/92 Series A(3) 500,000 100.00
MMP 9/92 Series B(3) 500,000 100.00
Total 5,090,140
Notes:
(1) Through 7/31/03 and thereafter to amounts declining in steps to $100.00 after 7/31/13.
(2) Through 8/31/03 and thereafter to amounts declining in steps to $100.00 after 8/31/13.
(3) Money Market Preferred (MMP) dividend rates are variable and are set every 49 days via an
auction. The weighted average rates for these series in 2000, 1999, and 1998, including fees
for broker/dealer agreements, were 5.71%, 4.82%, and 4.49%, respectively.
Note 19 Common Stock
On July 20, 1998, Dominion’s Board of Directors authorized the repur-
chase of up to $650 million of Dominion common stock outstanding.
As of December 31, 1999, Dominion had repurchased approximately
11 million shares valued at approximately $471 million.
In addition, Dominion repurchased approximately 3.2 million
shares of stock in 2000 through the implementation of a total return