Dominion Power 2001 Annual Report Download - page 43

expects to permanently finance the portion temporarily funded
by internal sources by issuing Dominion Resources, Inc. debt
securities in the future. In January 2002, Dominion Resources,
Inc. issued $250 million 3.875 percent medium-term notes due
2004 for this purpose.
Dominion financed the cash consideration for the acquisi-
tion of Louis Dreyfus and the repayment of certain Louis
Dreyfus debt with the following issuances of CNG securities:
$200 million of 7.8 percent trust preferred securities due 2041,
issued through an affiliated trust; $500 million of 5.375 percent
senior notes due 2006; and $450 million of 6.25 percent senior
notes due 2011.
2001 — Short-Term Borrowings
At December 31, 2001, the Dominion Companies had commer-
cial paper programs with an aggregate limit of $2.05 billion sup-
ported by a $1.75 billion 364-day revolving credit facility and a
$300 million multi-year facility. These credit facilities mature in
the second quarter of 2002 and are expected to be replaced.
During 2001, credit facilities totaling $1.05 billion matured and
were not renewed.
The Dominion Companies’ net borrowings under the com-
mercial paper program were $1.86 billion at December 31, 2001,
a decrease of $555 million from amounts outstanding at Decem-
ber 31, 2000. Commercial paper borrowings are used primarily
to fund working capital requirements and bridge financing of
acquisitions, and therefore may vary significantly during the
course of the year depending upon the timing and amount of
cash requirements not satisfied by cash provided by operations.
In addition to commercial paper, Virginia Power may also
issue up to $200 million aggregate outstanding principal of
extendible commercial notes (ECNs) to meet working capital
requirements. ECNs are unsecured notes that are expected to be
sold in private placements. Any ECNs issued would have a stated
maturity of 390 days from issuance and may be redeemed, at
Virginia Power’s option, within 90 days or less from issuance.
There were no ECNs outstanding at December 31, 2001.
2001 — Issuance of Common Stock
In 2001, Dominion received proceeds of $245 million from the
issuance of common stock through Dominion Direct (a dividend
reinvestment and open enrollment direct stock purchase plan),
employee savings plans, and the exercise of employee stock
options. In addition, Dominion issued 14 million shares of com-
mon stock and stock options as part of the consideration paid in
the acquisition of Louis Dreyfus at a total value of approximately
$894 million.
2001 — Other Securities Issuances and Repayments
During 2001, Dominion and its consolidated subsidiaries also
issued the following other securities and used the net proceeds
primarily for general corporate purposes, including the
repayment of commercial paper and other debt and capital
expenditures:
•Senior notes: $1.1 billion bearing interest at (5.75 percent—
6.85 percent) due 2006-2011;
•Medium-term notes: $220 million bearing interest at vari-
able rates due 2003;
•Medium-term notes denominated in Canadian dollars and
issued through a Canadian subsidiary: $117 million (US
dollars) bearing interest at 6.1 percent due 2006;
•Tax exempt bonds: $50 million bearing interest at variable
rates due in 2031; and
•Notes with affiliates: $194 million 6 percent note to an affil-
iated telecommunications entity due 2005, and a $518 mil-
lion variable rate demand note due by 2006 to another
affiliated telecommunications entity. See Dominion Fiber
Ventures, LLC below and Note 29 to the Consolidated
Financial Statements.
In 2001, Dominion and its consolidated subsidiaries repaid
approximately $1.0 billion of long-term debt securities, exclud-
ing debt repayments associated with financial services opera-
tions. Also in 2001, Dominion purchased and redeemed, at par,
all of the outstanding shares of the Virginia Power January 1987
and June 1987 series of money market preferred stock for
$125 million.
In January 2002, Virginia Power called its $200 million,
6.75 percent 1997-A mortgage bonds due February 1, 2007 for
redemption in February 2002. Virginia Power funded the
redemption by issuing $650 million of 5.375 percent senior
notes due 2007. Virginia Power used the remaining proceeds for
general corporate purposes and to repay other debt.
2001 — DCI Financing Activities
In connection with the purchases and originations of loans and
the sales and collections of loans during 2001, DCI issued $3.3
billion and repaid $3.0 billion of long-term debt. With the sale of
Saxon Capital in July 2001, DCI no longer engages in the finan-
cial services activities giving rise to these sources and uses of cash.
For a discussion of Dominion’s divestiture of its financial services
business, see Note 6 to the Consolidated Financial Statements.
Amounts Available under Shelf Registrations
At December 31, 2001, Dominion Resources, Inc. had approxi-
mately $2.3 billion principal amount remaining under currently
effective shelf registrations, which was reduced in January 2002
by the issuance of $250 million of medium term notes due
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