For Immediate Release
December 16, 2002

Pepco today announced it will entrust administration of the proceeds from its 2002 employee fundraising campaign to the United Way of the National Capital Area (UWNCA), and indicated strong support for its new leadership.

Pepco also announced that it will conduct its 2003 campaign-which it will run as usual in conjunction with the Pepco chapter of Local 1900 of the International Brotherhood of Electrical Workers (IBEW)-under the United Way umbrella.

The company had withheld its decision regarding disbursement of pledged funds and cash donations until it had clear evidence of management reforms at UWNCA.

"My commitment to putting the United Way of the National Capital Area back on track is public knowledge," said John Derrick, chairman and CEO of Pepco Holdings, Inc., Pepco's parent company. "I actively support Robert Egger as interim executive director, and have great confidence in UWNCA's new board of directors. These factors-combined with the fiscal management reforms adopted at UWNCA-make me confident in our decision to commit our support."

Pepco, with 2400 employees in the Washington area, is a longtime corporate supporter of the area's United Way, and Derrick chaired the nominating task force that recently selected UWNCA's new board of directors.

"Pepco has a longstanding commitment to supporting the Washington area community and the many agencies that serve our neighbors in need," said Derrick, "and United Way has been an effective way to channel contributions from the company and from our employees to a wide variety of charities."

The reforms achieved so far by UWNCA's new management make him confident in the decision to stick with United Way through 2003, according to Derrick. But, he added, company auditors will keep a close eye on UWNCA's handling of Pepco's campaign contributions in the coming year.

"Like all United Way supporters, I was disappointed with the developments that necessitated the governance overhaul," Derrick said, "but I am optimistic that the new team will reward our confidence by putting out maximum effort and producing the results we all want: an effective and reliable way to help our communities."