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                             By-Laws

                               of

                 POTOMAC ELECTRIC POWER COMPANY
                        WASHINGTON, D. C.











                       As amended through
                        October 23, 1997






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                 POTOMAC ELECTRIC POWER COMPANY

                             BY-LAWS

                             ______


                            ARTICLE I

     SECTION 1.  The annual meeting of the stockholders of the
Company shall be held on such day, at such time and place within
or without the District of Columbia as the Board of Directors or
the Executive Committee shall designate for the purpose of
electing directors and of transacting such other business as may
properly be brought before the meeting.

     At an annual meeting of the stockholders, only such business
shall be conducted as shall have been properly brought before the
meeting.  To be properly brought before an annual meeting,
business must be specified in the notice of meeting (or any
supplement thereto) given by or at the direction of the Board,
otherwise properly brought before the meeting by or at the
direction of the Board, or otherwise properly brought before the
meeting by a stockholder.  In addition to any other applicable
requirements, for business to be properly brought before an
annual meeting by a stockholder, the stockholder must have given
timely notice thereof in writing to the Secretary of Potomac
Electric Power Company.  To be timely, a stockholder's notice
must be received at the principal executive offices of the
Company not less than 50 days nor more than 75 days prior to the
meeting; provided, however, that in the event that less than 65
days' notice or prior public disclosure of the date of the
meeting is given or made to stockholders, notice by the
stockholder to be timely must be so received not later than the
close of business on the fifteenth day following the day on which
such notice of the date of the annual meeting was mailed or such
public disclosure was made, whichever first occurs.  A
stockholder's notice to the Secretary shall set forth (i) a brief
description of the business desired to be brought before the
annual meeting and the reasons for conducting such business at
the annual meeting, (ii) the name and record address of the
stockholder proposing such business, (iii) the class and number
of shares of the Company that are beneficially owned by the
stockholder, and (iv) any material interest of the stockholder in
such business.

     Notwithstanding anything in the By-Laws to the contrary, no
business shall be conducted at the annual meeting except in
accordance with the procedures set forth in this Article I,
Section 1; provided, however, that nothing in this Article I,
Section 1 shall be deemed to preclude discussion by any
stockholder of any business properly brought before the annual
meeting in accordance with such procedures.


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                                2

     The Chairman of an annual meeting shall, if the facts
warrant, determine that business was not properly brought before
the meeting in accordance with the provisions of this Article I,
Section 1, and if he should so determine, he shall so declare to
the meeting and any such business not properly brought before the
meeting shall not be transacted.

     SECTION 2.  Special meetings of the stockholders, when
called, shall be held at such time and place within or without
the District of Columbia and may be called by the Board of
Directors, or the Executive Committee, or the holders of record
of not less than one-fifth of all the outstanding shares entitled
to vote at the meeting, or, if the meeting is for the purpose of
enabling the holders of the Serial Preferred Stock of the Company
to elect directors upon the conditions set forth in the Articles
of Incorporation of the Company, such meeting shall be called as
therein provided.

     SECTION 3.  Written notice stating the place, day and hour
of each meeting of the stockholders and the purpose or purposes
for which the meeting is called shall be given not less than ten
days (or such longer period as may be prescribed by law) and not
more than fifty days before the date of the meeting to each
stockholder of record entitled to vote at the meeting, by
depositing such notice in the United States mail addressed to the
respective stockholders at their addresses as they appear on the
records of the Company, with postage thereon prepaid.

     In connection with the first election of a portion of the
members of the Board of Directors by the holders of the Serial
Preferred Stock upon accrual of such right, as provided in the
Articles of Incorporation of the Company, the Company shall
prepare and mail to the holders of the Serial Preferred Stock
entitled to vote thereon such proxy forms, communications and
documents as may be deemed appropriate for the purpose of
soliciting proxies for the election of directors by the holders
of the Serial Preferred Stock.

     The Secretary or an Assistant Secretary of the Company shall
cause to be made, at least ten days before each meeting of
stockholders, a complete list of the stockholders entitled to
vote at such meeting or any adjournment thereof, with the address
of and the number of shares held by each.  Such list, for a
period of ten days prior to such meeting, shall be kept on file
at the principal place of business of the Company and shall be
subject to inspection for any proper purpose by any stockholder
at any time during usual business hours.  Such list shall also be
produced and kept open at the time and place of the meeting and
shall be subject to the inspection for any proper purpose of any
stockholder during the whole time of the meeting.

     SECTION 4.  At each meeting of stockholders the holders
of record of a majority of the outstanding shares entitled
to vote at such meeting, represented in person or by proxy,
shall constitute a quorum, except as otherwise provided by
law or by the Articles of Incorporation of the Company.  
The affirmative vote of the holders of a majority of the

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                                3

shares represented at a duly organized meeting at which a quorum
was present at the time of organization, and entitled to vote on
the subject matter, shall be the act of the stockholders, unless
the vote of the holders of a greater number, or voting by
classes, is required by law or by the Articles of Incorporation
of the Company and except that in elections of directors those
receiving the greatest numbers of votes shall be deemed elected
even though not receiving a majority.  If a meeting cannot be
organized because a quorum has not attended, the holders of a
majority of the shares represented at the meeting may adjourn the
meeting from time to time, without notice other than announcement
at the meeting, until a quorum shall have been obtained, when any
business may be transacted which might have been transacted at
the meeting as first convened had there been a quorum.

     SECTION 5.  Meetings of the stockholders shall be presided
over by the Chairman of the Board or, if he is not present, by
the President or, if neither is present, by a Vice Chairman or,
if no such officer is present, by a chairman to be chosen at the
meeting.  The Secretary of the Company or, if he is not present,
an Assistant Secretary of the Company or, if neither is present,
a secretary to be chosen at the meeting, shall act as Secretary
of the meeting.

     SECTION 6.  Each stockholder entitled to vote at any meeting
may so vote either in person or by proxy executed in writing by
the stockholder or by his duly authorized attorney-in-fact and
shall be entitled to one vote on each matter submitted to a vote
for each share of stock of the Company having voting power
thereon registered in his name at the date fixed for the
determination of the stockholders entitled to vote at the
meeting.

     SECTION 7.  At all elections of directors the voting shall
be by ballot.  At all such elections, the Chairman of the meeting
shall appoint two inspectors of election, unless such appointment
shall be unanimously waived by the stockholders present in person
or represented by proxy at the meeting and entitled to vote for
the election of directors.  No director or candidate for the
office of director shall be appointed as such inspector.  The
inspectors, before entering upon the discharge of their duties,
shall take and subscribe an oath or affirmation faithfully to
execute the duties of inspector at such meeting with strict
impartiality and according to the best of their ability, and
shall take charge of the polls and after the balloting shall make
a certificate of the result of the vote taken.

     SECTION 8.  In order to determine who are stockholders of
the Company for any proper purpose, the Board of Directors either
may close the stock transfer books or, in lieu thereof, may fix
in advance a date as the record date for such determination, such
date in any case to be not more than fifty days (and, in the case
of a meeting of stockholders, not less than ten days or such
longer period as may be required by law) prior to the date on
which the particular action, requiring such determination, is to
be taken.  When such a record date has been so fixed for the
determination of stockholders entitled to vote at a meeting, such
determination shall apply to any adjournment thereof.

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                                4

                           ARTICLE II

                       BOARD OF DIRECTORS

     SECTION 1.  The Board of Directors of the Company shall
consist of twelve persons, each of whom shall be a stockholder of
the Company.  The directors shall be divided into three classes,
designated Class I, Class II, and Class III.  Each of the classes
shall have four directors.  At the 1987 annual meeting of
stockholders, Class I directors shall be elected for a one-year
term, Class II directors for a two-year term, and Class III
directors for a three-year term.  At each succeeding annual
meeting of stockholders beginning in 1988, successors to the
class of directors whose term expires at that annual meeting
shall be elected for a three-year term.  Except as otherwise
provided in the Articles of Incorporation of the Company and in
these By-Laws, the directors shall hold office until the annual
meeting of the stockholders for the year in which their
respective terms expire and until their respective successors
shall have been elected and qualified.  No person shall be
eligible for election as a director after he shall have attained
his seventieth birthday, and no person shall be eligible to serve
as a director beyond the next annual meeting after he shall have
attained his seventieth birthday.  No director who is a full time
employee of the Company shall be eligible to serve as a director
beyond the next annual meeting after termination of his
employment with the Company, provided, that (a) this provision
shall not apply to a director who is serving or has served as
Chief Executive Officer and (b) a director serving at the time of
termination of employment as Vice Chairman shall be permitted to
continue as director until the expiration of his three-year term. 
Seven members of the Board shall constitute a quorum for the
transaction of business, but if any meeting of the Board cannot
be organized because a quorum has not attended, a majority of
those present may adjourn the meeting from time to time, without
notice other than announcement at the meeting, until a quorum
shall have been obtained, when any business may be transacted
which might have been transacted at the meeting as first convened
had there been a quorum.  The acts of a majority of the directors
present at a meeting at which a quorum is present shall, except
as otherwise provided by law, by the Articles of Incorporation of
the Company, or by these By-Laws, be the acts of the Board of
Directors.

     Only persons who are nominated in accordance with the
following procedures shall be eligible for election as Directors. 
Nominations of persons for election to the Board of the Company
may be made at the annual meeting of stockholders by or at
the direction of the Board of Directors, by any nominating
committee or person appointed by the Board, or by any
stockholder of the Company entitled to vote for the election
of Directors at the meeting who complies with the notice
procedures set forth in this Article II, Section 1.  Such
nominations, other than those made by or at the direction 
of the Board, shall be made pursuant to timely notice in 
writing to the Secretary of Potomac Electric Power Company.  
To be timely, a stockholder's notice shall be received at 
the principal executive offices of the Company not less than 
50 days nor more than 75 days prior to the meeting; provided,

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                                5

however, that in the event that less than 65 days' notice or
prior public disclosure of the date of the meeting is given or
made to stockholders, notice by the stockholder to be timely must
be so received not later than the close of business on the
fifteenth day following the day on which such notice of the date
of the meeting was mailed or such public disclosure was made,
whichever first occurs.  Such stockholder's notice to the
Secretary shall set forth (a) as to each person whom the
stockholder proposes to nominate for election or reelection as a
Director, (i) the name, age, business address and residence
address of the person, (ii) the principal occupation or
employment of the person, (iii) the class and number of shares of
capital stock of the Company that are beneficially owned by the
person and (iv) any other information relating to the person that
is required to be disclosed in solicitations for proxies for
election of Directors pursuant to Section 14(a) of the Securities
Exchange Act of 1934, as amended; and (b) as to the stockholder
giving the notice (i) the name and record address of the
stockholder and (ii) the class and number of shares of capital
stock of the Company that are beneficially owned by the
stockholder.  The Company may require any proposed nominee to
furnish such other information as may reasonably be required by
the Company to determine the eligibility of such proposed nominee
to serve as Director of the Company.  No person shall be eligible
for election as a Director of the Company unless nominated in
accordance with the procedures set forth herein.

     The Chairman of the meeting shall, if the facts warrant,
determine that a nomination was not made in accordance with the
foregoing procedure, and if he should so determine, he shall so
declare to the meeting and the defective nomination shall be
disregarded.

     The Board of Directors, as soon as is reasonably practicable
after the initial election of Directors by the stockholders in
each year, shall elect one of its number Chairman of the Board,
who may be, but is not required to be, an officer and employee of
the Company.

     SECTION 2.  Any vacancy, from any cause other than an
increase in the number of Directors, occurring among the
directors shall be filled without undue delay by a majority of
the remaining directors who were elected, or whose predecessors
in office were elected, by the same class of stockholders as that
which elected the last incumbent of the vacant directorship.  The
term of any director elected by the remaining directors to fill a
vacancy (other than one caused by an increase in the number of
directors) shall expire at the next stockholders' meeting at
which directors are elected.

     SECTION 3.  Regular meetings of the Board of Directors 
shall be held at the office of the Company in the District 
of Columbia (unless otherwise fixed by resolution of the 
Board) at such time as may from time to time be fixed by
resolution of the Board.  Special meetings of the Board 
may be held upon call of the Executive Committee, or the 
Chairman of the Board, or the President, or a Vice Chairman, 
by oral, telegraphic or written notice, setting forth the 
time and place (either within or without the District of
Columbia) of the meeting, duly served on or sent or
mailed to each director not less than two days before the

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                                6

meeting.  A meeting of the Board may be held without notice,
immediately after, and at the same place as, the annual meeting
of the stockholders.  A waiver in writing of any notice, signed
by a director, whether before or after the time stated therein,
shall be deemed equivalent to the giving of such notice to such
director.  Neither the business to be transacted at, nor the
purpose of, any regular or special meeting of the Board need be
specified in any notice, or waiver of notice, of such meeting.

     SECTION 4.  Meetings of the Board of Directors shall be
presided over by the Chairman of the Board or, if he is not
present, by the President or, if neither is present, by a Vice
Chairman or, if no such officer is present, by a chairman to be
chosen at the meeting.  The Secretary of the Company or, if he is
not present, an Assistant Secretary of the Company or, if neither
is present, a secretary to be chosen at the meeting, shall act as
secretary of the meeting.

     SECTION 5.  The Board of Directors may, by resolution or
resolutions adopted by not less than the number of directors
necessary to constitute a quorum of the Board, designate an
Executive Committee consisting of not less than three nor more
than seven directors.  Except as otherwise provided by law, the
Executive Committee shall have and may exercise, when the Board
is not in session, all of the powers of the Board in the
management of the property, business and affairs of the Company;
but the Executive Committee shall not have power to fill
vacancies in the Board, or to change the membership of, or to
fill vacancies in, the Executive Committee, or to adopt, alter,
amend, or repeal by-laws of the Company.  The Board shall have
the power at any time to fill vacancies in, to change the
membership of, or to dissolve, the Executive Committee.  The
Executive Committee may make rules for the conduct of its
business and fix the time and place of its meetings, and may
appoint such committees and assistants as it shall from time to
time deem necessary.  A majority of the members of the Executive
Committee shall constitute a quorum, and the acts of a majority
of the members of the Committee present at a meeting at which a
quorum is present shall be the acts of said Committee.  All
action taken by the Executive Committee shall be reported to the
Board at its regular meeting next succeeding the taking of such
action.

     SECTION 6.  The Board of Directors may also, by 
resolution or resolutions adopted by not less than the number 
of directors necessary to constitute a quorum of the Board,
designate one or more other committees, each such committee to
consist of such number of directors as the Board may from time 
to time determine, which, to the extent provided in said
resolution or resolutions, shall have and may exercise such
limited authority as the Board may authorize.  Such committee 
or committees shall have such name or names as the Board may 
from time to time determine.  The Board shall have the power 
at any time to fill vacancies in, to change the membership of, 
or to dissolve, any such committee.  A majority, or such other
number as the Board may designate, of the members of any such
committee shall constitute a quorum.  Each such committee may
make rules for the conduct of its business and fix the time and
place of its meetings unless the Board shall otherwise provide.  

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                                7

All action taken by any such committee shall be reported to the
Board at its regular meeting next succeeding the taking of such
action, unless otherwise directed.

     SECTION 7.  The Board of Directors shall fix the
compensation to be paid to each director who is not a salaried
employee of the Company for serving as a director and for
attendance at meetings of the Board and committees thereof, and
may authorize the payment to directors of expenses incurred in
attending any such meeting or otherwise incurred in connection
with the business of the Company.  This By-Law shall not be
construed to preclude any Director from serving the Company in
any other capacity and receiving compensation therefor.

     SECTION 8.  At a special meeting called expressly for such
purpose (i) any director elected by the holders of the Serial
Preferred Stock, or elected by directors to fill a vacancy among
the directors elected by the holders of such stock, may be
removed, only for cause, by a vote of the holders of a majority
of the shares of Serial Preferred Stock, and the resulting
vacancy may be filled, for the unexpired term of the director so
removed, by a vote of the holders of such Stock; and (ii) any
director elected by the holders of the Common Stock, or elected
by directors to fill a vacancy among the directors elected by the
holders of such stock, may be removed, only for cause, by a vote
of the holders of a majority of the shares of Common Stock, and
the resulting vacancy may be filled, for the unexpired term of
the director so removed, by a vote of the holders of such Stock.

     SECTION 9.  With respect to a Company officer, director, or
employee, the Company shall indemnify, and with respect to any
other individual the Company may indemnify, any person who was or
is a party or is threatened to be made a party to any threatened,
pending or completed action, suit or proceeding (an "Action"),
whether civil, criminal, administrative, arbitrative or
investigative (including an Action by or in the right of the
Company) by reason of the fact that he is or was a director,
officer, employee or agent of the Company, or is or was serving
at the request of the Company as a director, officer, employee or
agent of another corporation, partnership, joint venture, trust
or other enterprise, against expenses (including attorneys'
fees), judgments, fines and amounts paid in settlement actually
and reasonably incurred by him in connection with such Action;
except in relation to matters as to which he shall be finally
adjudged in such Action to have knowingly violated the criminal
law or be liable for willful misconduct in the performance of his
duty to the Company.  The termination of any Action by judgment,
order, settlement, conviction, or upon a plea of nolo contendere
or its equivalent, shall not of itself create a presumption that
the person was guilty of willful misconduct.

     Any indemnification (unless ordered by a court) shall be
made by the Company only as authorized in the specific case 
upon a determination that indemnification of the director,
officer, employee or agent is proper in the circumstances 
because he has met the applicable standard of conduct set forth
above.  In the case of any director, such determination shall be 

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                                8

made:  (1) by the Board of Directors by a majority vote of a
quorum consisting of directors who were not parties to such
Action; or (2) if such a quorum is not obtainable, by majority
vote of a committee duly designated by the Board of Directors (in
which designation directors who are parties may participate)
consisting solely of two or more directors not at the time
parties to the proceeding; or (3) by special legal counsel
selected by the Board of Directors or its committee in the manner
prescribed by clause (1) or (2) of this paragraph, or if such a
quorum is not obtainable and such a committee cannot be
designated, by majority vote of the Board of Directors, in which
selection directors who are parties may participate; or (4) by
vote of the shareholders, in which vote shares owned by or voted
under the control of directors, officers and employees who are at
the time parties to the Action may not be voted.  In the case of
any officer, employee, or agent other than a director, such
determination may be made (i) by the Board of Directors or a
committee thereof; (ii) by the Chairman of the Board of the
Company or, if the Chairman is a party to such Action, the
President of the Company, or (iii) such other officer of the
Company, not a party to such Action, as such person specified in
clause (i) or (ii) of this paragraph may designate. 
Authorization of indemnification and evaluation as to
reasonableness of expenses shall be made in the same manner as
the determination that indemnification is permissible, except
that if the determination is made by special legal counsel,
authorization of indemnification and evaluation as to
reasonableness of expenses shall be made by those entitled
hereunder to select such legal counsel.

     Expenses incurred in defending an Action for which
indemnification may be available hereunder shall be paid by the
Company in advance of the final disposition of such Action as
authorized in the manner provided in the preceding paragraph,
subject to execution by the person being indemnified of a written
undertaking to repay such amount if and to the extent that it
shall ultimately be determined by a court that such
indemnification by the Company is not permitted under applicable
law.

     It is the intention of the Company that the indemnification
set forth in this Section 9 of Article II, shall be applied to no
less extent than the maximum indemnification permitted by law. 
In the event that any right to indemnification or other right
hereunder may be deemed to be unenforceable or invalid, in whole
or in part, such unenforceability or invalidity shall not affect
any other right hereunder, or any right to the extent that it is
not deemed to be unenforceable.  The indemnification provided
herein shall be in addition to, and not exclusive of, any other
rights to which those indemnified may be entitled under any by-
law, agreement, vote of stockholders, or otherwise, and shall
continue as to a person who has ceased to be a director, officer,
employee, or agent and inure to the benefit of such person's
heirs, executors, and administrators.

     SECTION 10.  The Board of Directors may, in its 
discretion, at any time elect one or more persons to the 
position of Advisory Director, to serve as such during 
the pleasure of the Board, but, except for a director 
who has served as Chief Executive Officer, no person 

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                                9

shall be eligible to serve as an Advisory Director beyond the
next annual meeting after he shall have attained his seventy-
second birthday.  Advisory Directors so elected by the Board
shall be entitled to attend, and take part in discussions at,
meetings of the Board of Directors, but shall not be considered
members of the Board for quorum or voting purposes.  Advisory
Directors shall receive the same compensation as members of the
Board.

     SECTION 11.  In any proceeding brought by a stockholder in
the right of the Company or brought by or on behalf of the
stockholders of the Company, no monetary damages shall be
assessed against an officer or director.  The liability of an
officer or director shall not be limited as provided in this
section if the officer or director engaged in willful misconduct
or a knowing violation of the criminal law.

                           ARTICLE III

                            OFFICERS

     SECTION 1.  The Board of Directors, as soon as reasonably
practicable after the initial election of directors by
stockholders in each year, may elect a Chairman of the Board as
an officer of the Company, shall elect a President, may elect one
or more Vice Chairmen and shall elect one or more Vice Presidents
(who may be given such other descriptive titles as the Board may
specify), a Secretary, a Treasurer and a Comptroller, and from
time to time may elect such Assistant Secretaries, Assistant
Treasurers, Assistant Comptrollers and other officers, and
appoint such other agents, as it may deem desirable.  Any two or
more offices may be held by the same person, except the offices
of President and Secretary.  The Board of Directors shall elect
the Chairman of the Board or one of the above officers Chief
Executive Officer of the Company.

     SECTION 2.  The term of office of all officers shall be
until the next succeeding annual election of officers and until
their respective successors shall have been elected and
qualified; but any officer or agent elected or appointed by the
Board of Directors may be removed, with or without cause, by the
affirmative vote of a majority of the members of the Board
whenever in their judgment the best interests of the Company will
be served thereby.  Such removal shall be without prejudice to
contract rights, if any, of the person so removed.  Election or
appointment of an officer or agent shall not of itself create
contract rights.  Unless specifically authorized by resolution of
the Board of Directors, no agreement for the employment of any
officer for a period longer than one year shall be made.

     SECTION 3.  Subject to such limitations as the Board of
Directors or the Executive Committee may from time to time
prescribe, the officers of the Company shall each have such
authority and perform such duties in the management of the
property, business and affairs of the Company as by custom
generally pertain to their respective offices, as well as 
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                               10

such authority and duties as from time to time may be conferred
by the Board of Directors, the Executive Committee or the Chief
Executive Officer.

     SECTION 4.  The salaries of all officers, employees and
agents of the Company shall be determined and fixed by the Board
of Directors, or pursuant to such authority as the Board may from
time to time prescribe.

                           ARTICLE IV

                      CERTIFICATES OF STOCK

     SECTION 1.  The shares of the capital stock of the Company
shall be represented by certificates, provided that the Board of
Directors of the Company may provide by resolution that some or
all of the shares of any or all of its classes or series of
capital stock may be uncertificated shares.  Except as otherwise
expressly provided by law, the rights and obligations of the
holders of uncertificated shares and the rights and obligations
of the holders of certificates representing shares of the same
class and series shall be identical.  Shares of the capital stock
of the Company that are evidenced by certificates shall be in
such form as the Board of Directors may from time to time
prescribe.  Such certificates shall be signed by the President or
a Vice President and by the Secretary or an Assistant Secretary,
shall be sealed with the seal of the Company, or a facsimile
thereof, shall be countersigned and registered in such manner, if
any, as the Board may by resolution prescribe.  Where such a
certificate is countersigned by a transfer agent (other than the
Company or an employee of the Company), or by a transfer clerk
and registered by a registrar, the signatures thereon of the
President or Vice President and the Secretary or Assistant
Secretary may be facsimiles.  In case any officer who has signed
or whose facsimile signature has been placed upon any such
certificate shall have ceased to be such officer before such
certificate is issued, it may be issued by the Company with the
same effect as if such officer had not ceased to hold such office
at the date of its issue.

     SECTION 2.  The shares of the capital stock of the Company
shall be transferable on the books of the Company by the holders
thereof in person or by duly authorized attorney, and, if
represented by certificates, upon surrender and cancellation of
the certificates evidencing such shares, with duly executed
assignment and power of transfer endorsed thereon or attached
thereto, and with such proof of the authenticity of the
signatures as the Company or its agents may reasonably require
and, if uncertificated, upon receipt of appropriate instructions.

     SECTION 3.  No certificate evidencing shares of the 
capital stock of the Company shall be issued in place of 
any certificate alleged  to have been lost, stolen, or 
destroyed, except upon production of such evidence of 
the loss, theft or destruction, and upon such 

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                               11

indemnification of the Company and its agents by such person or
persons and in such manner, as the Board of Directors may from
time to time prescribe.


                            ARTICLE V

                 CHECKS, NOTES, CONTRACTS, ETC.

     All checks and drafts on the Company's bank accounts, bills
of exchange, promissory notes, acceptances, obligations, other
instruments for the payment of money, and endorsements other than
for deposit in a bank account of the Company shall be signed by
the Treasurer or an Assistant Treasurer and shall be
countersigned by the Chief Executive Officer, the President, a
Vice Chairman or a Vice President, unless otherwise authorized by
the Board of Directors; provided that checks drawn on the
Company's dividend and/or special accounts may bear the manual
signature, or the facsimile signature, affixed thereto by a
mechanical device, of such officer or agent as the Board of
Directors shall authorize.

     All contracts, bonds and other agreements and undertakings
of the Company shall be executed by the Chief Executive Officer,
the President, a Vice Chairman or a Vice President and by such
other officer or officers, if any, as may be designated, from
time to time, by the Board of Directors and, in the case of any
such document required to be under seal, the corporate seal shall
be affixed thereto and attested by the Secretary or an Assistant
Secretary.

     Whenever any instrument is required by this Article to be
signed by more than one officer of the Company, no person shall
so sign in more than one capacity.


                           ARTICLE VI

                           FISCAL YEAR

     The fiscal year of the Company shall begin on the first day
of January in each year and shall end on the thirty-first day of
December following.

                           ARTICLE VII

                             OFFICES

     The principal office of the Company shall be situated 
in the District of Columbia.  The registered office of 
the Company in Virginia shall be situated in the County
of Fairfax.  The Company may have such other offices 
at such places, within the District of Columbia, the 

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Commonwealth of Virginia, or elsewhere, as shall be determined
from time to time by the Board of Directors or by the Chief
Executive Officer.


                          ARTICLE VIII

                           AMENDMENTS

     Except as otherwise provided by law, the Board of Directors
may alter, amend, or repeal the By-Laws of the Company, or adopt
new By-Laws, at any meeting of the Board, by the affirmative vote
of not less than the number of directors necessary to constitute
a quorum of the Board.