EXHIBIT 10-E

RESTRICTED STOCK AGREEMENT BETWEEN THOMAS S. SHAW AND
CONECTIV

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RESTRICTED STOCK AGREEMENT

                        THIS RESTRICTED STOCK AGREEMENT (“Agreement”) is made
and entered into effective as of the 7th day of June, 2002 (the “Date of Grant”)
between Thomas S. Shaw (“Employee”) and Conectiv (the “Company”) and its
Subsidiaries (collectively, the “Employer”).

W I T N E S S E T H:

                        WHEREAS, the Employee is eligible to participate in the
Conectiv Incentive Compensation Plan (the “Plan”, known as the “Conectiv
Incentive Compensation Plan”); and

                        WHEREAS, the Employer wishes to induce Employee to
remain employed by Employer to ensure continuation of business operations
whether or not the merger involving Employer, Potomac Electric Power Company,
and New RC, Inc. (the “Merger”) occurs; and

                        WHEREAS, Employee is willing to accept certain
restricted stock in lieu of grants made and to be made under the Plan, as
described in more detail herein;

                        NOW, THEREFORE, in consideration of the premises and the
undertakings of the parties which follow, it is hereby agreed:

                        1.    Award . Employee is hereby granted 65,000 shares
of Restricted Stock (“RS”), subject to the terms of the Plan and subject to
further restrictions set forth below. In consideration therefor, Employee hereby
surrenders all rights he may have (or might in the future have had) to the 8,100
shares of RS granted to him in January of 2001.

                        2.   Vesting; Acceleration.

                        (a)   Subject to the provisions of Sections 2(b) and
5(b), Employee’s rights with respect to the number of shares of RS awarded
hereunder as set forth in the table below shall vest unconditionally on the
dates specified in the table below if Employee is employed as an active employee
of the Company, an affiliate of the Company, or a successor in interest to the
Company (in any such case, the “Successor Employer”) on the specified vesting
date.

Vesting Date   Number of Shares Vested   January 1, 2004   15,000   January 1,
2005   15,000 (plus prior vested shares)   January 1, 2006   35,000 (plus prior
vested shares)  

                        (b)   All unvested shares will become 100% vested if the
Employee ceases to be employed by the Company (or any Successor Employer) due to
his death or Disability. The shares that otherwise would vest on January 1, 2004
will vest earlier upon the Employee’s termination without Cause or resignation
for Good Reason. For this purpose, the terms “Disability,” “Cause” and “Good
Reason” will each have the meanings defined in the Change-in-Control Severance
Agreement between the Company and the Employee dated December 4, 2000.

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                        (c)   Following termination of employment, any shares of
RS that are not then vested will be forfeited by the Employee.

                        3.    Restrictions and Rights .

                        (a)   Prior to vesting, shares of RS shall not be
voluntarily or involuntarily sold, assigned, transferred, pledged, alienated,
hypothecated or encumbered by the Employee, other than by will or the laws of
descent and distribution.

                        (b)   Prior to vesting, Employee shall have voting
rights and receive dividends (if any) in cash, without restriction. At the
election of the Employee, dividends may be deferred through the Conectiv
Deferred Compensation Plan, subject to the limitations set forth therein.

                        4.    Stock Certificates . The RS awarded hereunder
shall be evidenced by issuance of one or more stock certificates, which shall be
held by the Successor Employer during the restriction period. Such

certificates shall be registered in the name of the Employee and shall bear an
appropriate restrictive legend prohibiting sale, transfer, pledge or
hypothecation of the RS until the expiration of the restriction period. Upon
vesting of any shares of RS awarded hereunder, all restrictions will lapse and
certificates representing full ownership of the RS will be issued to the
Employee or his or her legal representative, without the restrictive legend
described herein.

                        5.    Change in Control .

                        (a)    Notwithstanding any provision of the Plan or of
this Agreement, upon the closing of the Merger, 100% of the RS awarded hereunder
shall be converted to restricted stock of New RC, Inc., in a number of shares to
be determined in accordance with such merger agreement on the same basis as
other shares of the Company. The RS that are converted to restricted stock of
the new corporation by operation of the foregoing sentence (“Converted RS”)
shall be subject to the terms and conditions of the Plan and this Agreement.

                        (b)   In the event any Change in Control other than the
Merger does occur, all conditions with respect to the vesting of such RS shall
be deemed to have been satisfied, any uncompleted time periods at the date of
such Change in Control shall be deemed to have been completed and all
restrictions with respect to such outstanding shares of RS shall lapse
immediately, and such shares shall be fully vested and nonforfeitable.

                        6.    Subject to Plan . The award of RS is expressly
subject to the Plan which is hereby incorporated herein by this reference. To
the extent not otherwise expressly defined herein, capitalized terms in this
Agreement shall have the meaning set forth in the Plan. In the event that any
provision hereof is inconsistent with the Plan, the provisions of the Plan shall
govern.

                        7.    Transfer Restrictions . All shares of Stock of the
Company received under this Agreement shall be subject to such restrictions on
transfer as may be contained in the Company’s Articles of Incorporation,
By-Laws, or any stock transfer restriction agreements as may be in effect that
cover stock held by officers and key employees of the Company or any subsidiary
or parent of the Company, as applicable.

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                        8.    Binding Agreement . The Employee hereby agrees on
behalf of himself, his successors, heirs, and personal representatives, to be
bound by the terms and conditions of this Agreement.

                        9.    Tax Withholding . Upon the distribution of RS to
Employee, Successor Employer shall have the right to withhold any applicable
federal, state or local taxes required by law as determined by the Successor
Employer. The Committee may permit or require the Employee to have any portion
of any withholding or other taxes payable in respect of such distribution of
Stock satisfied through the payment of cash by the Employee to the Successor
Employer, the retention by the Successor Employer of shares of stock, or
delivery of previously-owned shares of the Employee’s stock, having a Fair
Market Value equal to the withholding amount.

                        10.    No Right of Service . This Agreement shall not
confer upon the Employee any right to continued service, nor shall it interfere
in any way with the right of the Company or Successor Employer to terminate the
service of the Employee at any time.

                        11.    Governing Law . This Agreement shall be governed
by and construed in accordance with the laws of the State of Delaware, without
regard to the principles of conflict of laws.

                        SIGNED as of the date and year first above written.

 

Date: June 7, 2002   By:   /s/ T. S. Shaw    

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      Thomas S. Shaw

  CONECTIV

    By:   /s/ Donald E. Cain    

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      Donald E. Cain

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