Exhibit
10.1
 Execution Version




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TABLE OF CONTENTS
 ARTICLE I DEFINITIONS
    
    
    21.1 Definitions; Principles of Construction
    
    
    2ARTICLE II PURCHASE AND SALE
    
    
    22.1 Acquired Assets
    
    
    22.2 Excluded Assets
    
    
    42.3 Assumed Obligations
    
    
    62.4 Retained Obligations
    
    
    72.5 Assignment of Equipment Leases
    
    
    82.6 VA Distribution Business; Inventory
    
    
    9ARTICLE III PURCHASE PRICE
    
    
    93.1 Purchase Price
    
    
    93.2 Post-Closing True-Up
    
    
    103.3 Allocation of Final Purchase Price
    
    
    12ARTICLE IV THE CLOSING
    
    
    134.1 Time and Place of Closing
    
    
    134.2 Payment of Closing Payment
    
    
    134.3 Deliveries by Seller
    
    
    134.4 Deliveries by Buyer
    
    
    14ARTICLE V REPRESENTATIONS AND WARRANTIES OF THE SELLER
    
    
    145.1 Organization; Power and Authority
    
    
    145.2 Authority
    
    
    145.3 Consents and Approvals; No Violation
    
    
    155.4 Company Reports
    
    
    155.5 2008 Statement
    
    
    165.6 Undisclosed Liabilities
    
    
    175.7 Absence of Certain Changes or Events
    
    
    175.8 Title and Related Matters
    
    
    175.9 Insurance
    
    
    185.10 Environmental, Health and Safety Matters
    
    
    185.11 Regulation as a Utility
    
    
    195.12 Labor and Employment Matters
    
    
    195.13 Employee Benefit Plans
    
    
    205.14 Contracts
    
    
    205.15 Legal Proceedings, Etc
    
    
    225.16 Compliance with Permits and Laws
    
    
    225.17 Tax Matters
    
    
    225.18 Related Party Matters
    
    
    235.19 Intellectual Property
    
    
    235.20 Fees and Commissions
    
    
    235.21 Disclaimers
    
    
    23
 i




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5.22 Acknowledgement
    
    
    24ARTICLE VI REPRESENTATIONS AND WARRANTIES OF BUYER
    
    
    246.1 Power and Authority
    
    
    246.2 Authority
    
    
    246.3 Consents and Approvals; No Violation
    
    
    256.4 Availability of Funds
    
    
    256.5 Litigation; Regulatory Approvals
    
    
    266.6 Qualified Buyer
    
    
    266.7 WARN Act
    
    
    266.8 Fees and Commissions
    
    
    266.9 Inspections
    
    
    26ARTICLE VII COVENANTS OF THE PARTIES
    
    
    267.1 Conduct of Business Prior to the Closing
    
    
    267.2 Access to Information
    
    
    297.3 Consents and Approvals
    
    
    307.4 Further Assurances
    
    
    327.5 Public Statements
    
    
    347.6 Expenses
    
    
    347.7 Tax Matters
    
    
    347.8 Employees
    
    
    367.9 Name of the Transferred Business After the Effective Time
    
    
    387.10 Insurance
    
    
    397.11 Certain Notices; Information
    
    
    397.12 Shared Locations and Equipment
    
    
    397.13 Virginia Settlement
    
    
    407.14 Communication Facilities
    
    
    407.15 Transmission Agreements
    
    
    417.16 Easements; Underbuild; Transmission Lines
    
    
    417.17 Surveys and Title Insurance
    
    
    427.18 Communication with Customers
    
    
    427.19 PCBs
    
    
    427.20 Sister Purchase Agreement
    
    
    427.21 Customer Migration
    
    
    437.22 Interchange Agreement
    
    
    437.23 Power Purchase Agreements
    
    
    437.24 Borderline Operational Matters
    
    
    43ARTICLE VIII CONDITIONS
    
    
    438.1 Conditions to Each Partys Obligations to Effect the Transactions
    
    
    438.2 Conditions to Obligations of Buyer
    
    
    448.3 Conditions to Obligations of Seller
    
    
    45ARTICLE IX SURVIVAL; INDEMNIFICATION
    
    
    469.1 Survival of Representations and Warranties
    
    
    469.2 Indemnification
    
    
    46
 ii




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9.3 Defense of Claims
    
    
    48ARTICLE X TERMINATION AND ABANDONMENT
    
    
    4910.1 Termination
    
    
    4910.2 Procedure and Effect of Termination
    
    
    51ARTICLE XI MISCELLANEOUS PROVISIONS
    
    
    5111.1 Amendment and Modification
    
    
    5111.2 Waiver of Compliance; Consents
    
    
    5111.3 Notices
    
    
    5111.4 Assignment
    
    
    5311.5 Rights Under This Agreement; No Third Party Beneficiaries
    
    
    5311.6 Governing Law
    
    
    5311.7 Counterparts
    
    
    5311.8 Interpretation; Construction
    
    
    5311.9 Schedules and Exhibits
    
    
    5311.10 Entire Agreement
    
    
    5311.11 Waiver of Jury Trial
    
    
    5411.12 Submission to Jurisdiction
    
    
    5411.13 Arbitration
    
    
    5411.14 Certain Remedies
    
    
    55
 Annex A
    
    Transferred TerritoryExhibits:Exhibit A
    
    DefinitionsExhibit B
    
    Form of Assignment and Assumption AgreementExhibit C
    
    Form of FIRPTA Affidavit




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Agreement Seller Buyer
 VA
Distribution Business
 Annex A Transferred Business Annex A Transferred Territory
 SVEC Annex A Sister Purchase Agreement Sister Business Annex A Section 2.2
 ODEC




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Definitions; Principles of Construction Exhibit A Exhibit A
 
 Acquired Assets Section 2.2 Section
2.6 Acquired Assets
 Schedule 2.1(a) Owned
Real Property
 Schedule 2.1(b) Transferred Easements
 Shared Location Schedule
2.2(a) Schedule 2.1(c)(1) Schedule 2.1(c)(2)
   2




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Schedule 2.1(c)(1) 2.1(c)(2) Section 2.6(c)
 Tangible Personal Property provided that Schedule 2.1(g)
 Section 2.5 Schedule 2.1(h) Equipment Leases provided that Schedule 2.1(h)
 Section 7.1 Section 7.23 Transferred
Contracts
     3




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Schedule 2.1(o) Acquired
Intellectual Property
  Annex A
  Sections 2.5 2.6
   Excluded Assets Excluded Assets
 Schedule 2.2(a) Excluded
Real Property
 Schedule 2.2(b) Excluded Easements
  Section
2.1(f)
 Schedule 2.1(g)
 4




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Shared
Contracts
   Section 2.1(f) (g) (m) (s)
 Schedule
2.1(o) Retained Intellectual Property Section 7.9
 Schedule 2.2(k) Schedule 2.1(g) Excluded Tangible Personal Property
  Section 2.5
    Section 7.7
 5




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Section 2.1(n)
 Section 2.1(n)
   Section 7.23
  Assumed Obligations Assumed Obligations
    Section 7.8
  6




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Section 2.4(j)
     Retained Obligations Section 2.3 Retained Obligations
   Section
2.3(d) Section 7.8
  Section 7.8
 7




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Schedule 2.4(f)
 Section 2.3(c) (e) (f) (g) (h)
    Assignment of Equipment Leases Seller
Lease Buy-Out Section
2.5 Section 2.5 Acquired
Asset
 8




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VA Distribution Business; Inventory
  Annex A
 Section 2.6(c)
 
 Purchase Price
  Purchase Price Certificate Estimated NBV
 9




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Schedule 5.5 Closing Payment multiplied by plus less
  Post-Closing True-Up
 Closing Statement Schedule 5.5 Schedule 3.2(a)
 provided however Closing
Statement Review Period provided further Independent Accounting Firm
Closing Statement Determination
 10




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Independent Accounting Firm
Partner
 Final NBV Section 3.2
 11




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Section 3.2(c) multiplied by plus less multiplied by plus less
  Section 3.2(d) Applicable Rate
 Allocation of Final Purchase Price Schedule 3.3 Allocation Post-Closing
Allocation Section 3.2 Section 3.2 Section 3.2(b) Section 3.3
 12




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Section 7.7
 
 Time and Place of Closing Article VIII Closing Article VIII Closing Date Effective
Time
 Payment of Closing Payment
 Deliveries by Seller
  Schedule 5.3(b)
  Section 2.1(j) 2.1(k) 2.1(l)
  Section 8.2(e)
 13




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Deliveries by Buyer
 Section 4.2
  Schedule
6.3(b)
   Section 8.3(d)
 
  Organization; Power and Authority
   Authority
 14




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Bankruptcy and Equity
Exception
 Consents and Approvals; No Violation
 Schedule 5.3(a) Seller Third-Party Consents
 Schedule 5.3(b) Seller
Required Regulatory Approvals Section 7.3(i)
 Company Reports
 Schedule 5.4(a) Financial
Statements
 15




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provided , however ,
  Schedule 5.5
 2008 Statement
 Schedule 5.5 Initial 2008
Statement Section 5.5(a)
 Schedule 5.5 2008
Statement
 16




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Section 2.1(g)
 Undisclosed Liabilities Schedule
5.6
 Absence of Certain Changes or Events Schedule 5.7
 Title and Related Matters
 Schedule 5.8(a)
 Section 7.1
 Schedule 5.8(c)
  17




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Insurance Schedule 5.9 Allegheny
 Environmental, Health and Safety Matters Schedule
5.10
   18




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Section 5.10
 Regulation as a Utility Schedule 5.11 Schedule 5.11
 Labor and Employment Matters
 19




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Schedule 5.12(a) Schedule 5.12(f)
 Employee Benefit Plans
 Benefit Plans Schedule 5.13(a)
 Schedule 5.13(b) Benefit
Arrangements
  Schedule 5.13(d)
 Contracts
 Schedule 5.14(a)
 20




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Schedule 5.14(b) (i) (xiv) Section 5.14(a)
  21




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Legal Proceedings, Etc Schedule 5.15
 Compliance with Permits and Laws Section 5.10
 Tax Matters Schedule
5.17 Schedule 5.17 Schedule 5.17
 22




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Related Party Matters Schedule 5.18
 Intellectual Property Schedule 5.19
 Fees and Commissions
 Disclaimers ARTICLE V ARTICLE V
 23




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Acknowledgement Article VI Article VI
 
  Power and Authority
 Authority Schedule 6.2
 24




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Consents and Approvals; No Violation
 Schedule 6.2
 Schedule 6.3(b) Buyer
Required Regulatory Approvals
 Availability of Funds Section 3.2(c) Section
 25




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7.20 Section
7.20
 Litigation; Regulatory Approvals
 Qualified Buyer
 WARN Act
 Fees and Commissions
 Inspections Article V Article V
 
 Conduct of Business Prior to the Closing Schedule 7.1 Schedule 7.1
 26




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provided however provided however
 Schedule 7.1(e)
 27




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Section 7.1
     Schedule 5.9
  Schedule 7.1(m)
  28




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(a) (o)
 Access to Information
 provided however provided however Section 7.2
 29




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Section 7.2 Proprietary
Information provided
 Section 7.2
 Consents and Approvals
   30




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FTC DOJ
  Regulatory Undertakings
   31




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Schedule 6.2 Section 7.20
  Further Assurances
  Receiving Party Entitled
Party
  32




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provided however
 Section 2.1(l)
 Schedule 5.14(b)
  33




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Public Statements
 Expenses
 Tax Matters
  Sections 7.7(a) 7.7(h)
 Section 7.7(c)
 34




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Section 7.7 Section
7.7(h) Section 7.7(d)
 Tax Audit
 provided however
 provided however
  Section 7.7
 Section 7.7
 Section 7.7(a)
 35




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Employees
 Eligible Employees Leave Employees provided however provided Section 7.8(a) Section 7.8(a) Transferring Employees
 Hire Date Prior Welfare Plans Replacement Welfare Plans
 36




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Buyer
Benefit Plans provided however
    Section 7.1(d)(i)
 37




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WARN Notice
Requirements
   Name of the Transferred Business After the Effective Time Allegheny Power
 38




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Insurance
 Certain Notices; Information
  Schedule 2.1(a)
  Schedules 2.1(a) 2.1(b) 2.1(c)(1) 2.1(c)(2) 2.1(g) 2.1(h) 2.1(o) Schedules 2.1(a) 2.1(b) 2.1(c)(1) 2.1(c)(2) 2.1(g) 2.1(h) 2.1(o) Section 7.11(d) Section 3.2
 Shared Locations and Equipment
    39




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Shared Facilities Shared Facilities Agreement
 i.
    
    obligation of each party to operate and maintain
each of the Shared Facilities in accordance with Good Utility Practices,
NERC Reliability Standards (including all cyber security policies and
procedures applicable if any Shared Facility is deemed to be a Critical
Asset under NERC standards) and PJM Emergency Operating Procedures;ii.
    
    security plans and procedures to ensure that each
Shared Location is reasonably secure;iii.
    
    procedures to ensure that only qualified employees
and contractors with proper training are utilized at the Shared
Facilities;iv.
    
    procedures regarding substation switching,
scheduling outages, accessing substations and other activities to ensure
the safety of all personnel and the reliability of the transmission and
distribution systems at the Shared Locations;v.
    
    procedures for the reimbursement of Buyer and
Seller by the other, as applicable, for the reasonable out-of-pocket
costs incurred by a party to maintain the common property at each Shared
Location; andvi.
    
    procedures for the reimbursement of Buyer and
Seller by the other, as applicable, for any reasonable out-of-pocket
costs incurred by a party because of such partys installation of
equipment or facilities at a Shared Location.
  Virginia Settlement
 Communication Facilities
  40




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Schedule 7.14(b) Communication Facilities Agreement
 Transmission Agreements
 Section 7.16(d) provided however
 Section 7.15
 Easements; Underbuild; Transmission Lines
  TrAIL Schedule 7.16(b) TrAIL
Project Lines TrAIL
Agreement provided however
 41




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Section 7.16(b)
  provided that
 Surveys and Title Insurance
 Communication with Customers
 PCBs
 Sister Purchase Agreement Section 10.1(b) (c) (e) (g)
 42




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Section
7.20(a)
  Customer Migration
 Interchange Agreement (vi) Schedule 5.14(b) Interchange Agreement
 Power Purchase Agreements PPA Assignment and Assumption Agreement
 Borderline Operational Matters
 
 Conditions to Each Partys Obligations to Effect the Transactions
 43




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Conditions to Obligations of Buyer
     Sections 8.2(a) 8.2(b) 8.2(c) 8.2(d)
 Schedule 5.3(b) Schedule 6.3(b)
 44




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Section 4.3 Schedule 6.2
 Schedule 2.4(f)
 Conditions to Obligations of Seller
    Sections 8.3(a) 8.3(b) 8.3(c)
 Schedule 5.3(b) Schedule 6.3(b)
 Section
4.4
 45




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provided that Section 7.20(a) (b)
 
 Survival of Representations and Warranties provided Sections
5.8 5.17 Article IX
 Indemnification
 Buyer Indemnified Parties Indemnifiable Loss Article V provided however Article V Section
9.2 De Minimis Loss Section 5.8 Section 9.2(a) provided further
 46




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Seller Indemnified Parties Article VI provided however Article VI Section 9.2 provided , however ,
 Indemnitee
 Section 9.2 Indemnifying Party Section 9.2
 Section
9.2(f) Article IX Sections
3.1 3.2 3.3 7.7 10.1(f) provided however
 47




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Section 10.1(f) Article IX
   Defense of Claims
 Third Party Claim
 Section 9.3(a) provided however
 Direct Claim
 48




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Section 9.3(d)
 Section 9.3
 
 Termination
  Section 10.1(f) Termination Date provided however Section 10.1(b) and provided further Section 10.1(b) Section 10.1(b)
 49




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Schedule 5.3(b) Schedule 6.3(b) Section 10.1(c)(ii)
   Section 7.19 provided that Section 11.13 Section 10.1(f)
 50




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Schedule 6.2
 Procedure and Effect of Termination Section 10.1
 Section 10.2 Sections
7.2(b) 7.5 7.6 provided however
  
 Amendment and Modification
 Waiver of Compliance; Consents Section 10.1(d) 10.1(e)
 Notices Section
11.3 provided
 51




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(a)
    
    If to Seller, to:The Potomac Edison Company800 Cabin Hill DriveGreensburg, PennsylvaniaFacsimile: (724) 830-7806Attention: Kathryn Pattonwith a copy to:Allegheny Power800 Cabin Hill DriveGreensburg, Pennsylvania 15601Facsimile: (724) 838-6095Attention: Mark JoensenandVinson & Elkins L.L.P.1001 Fannin Street, Suite 2500Houston, Texas 77002Facsimile: (713) 615-5855Attention: Keith R. Fullenweider(b)
    
    If to Buyer, to:Rappahannock Electric Cooperative247 Industrial CourtFredericksburg, VA 22408Facsimile: (540) 891-5917Attention: Chief Executive Officerwith a copy to:Orrick, Herrington & Sutcliffe LLP1152 15th Street, N.W.Washington, D.C. 20005-1706Facsimile: (202) 339-8500Attention: Kyle W. Drefke
  52




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Assignment
 Rights Under This Agreement; No Third Party Beneficiaries Section 9.2
 Governing Law
 Counterparts
 Interpretation; Construction
 Schedules and Exhibits Disclosure Schedules
 Entire Agreement
 53




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Waiver of Jury Trial
 Submission to Jurisdiction
 Arbitration
 Section 3.2
 provided however provided further
 54




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Commercial Arbitration
Rules Section 11.13
 Section 11.13
 Certain Remedies provided however
 Signature page follows
 55




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THE POTOMAC EDISON COMPANYBy:
    /s/ Paul J. EvansonName:
    Paul J. EvansonTitle:
    Chairman and Chief Executive Officer RAPPAHANNOCK ELECTRIC COOPERATIVEBy:
    /s/ Kent D. FarmerName:
    Kent D. FarmerTitle:
    President and Chief Executive Officer Asset Purchase Agreement  Signature Page




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ANNEX A
 Annex A
 Chart A Chart B
 Chart A
Substations and Distribution Line Circuits
 Party
    
    Substation/Circuit1.
    
    SVEC
    
    BARTONVILLE (FREDRICK CO.)2.
    
    SVEC
    
    DAIRY (FREDRICK CO.)3.
    
    REC
    
    FREDERICKTOWNE (FREDRICK CO.)4.
    
    REC
    
    GREENBRIER (FREDRICK CO.)5.
    
    REC
    
    LAKESIDE (FREDRICK CO.)6.
    
    SVEC
    
    MIDDLE ROAD (FREDRICK CO.)7.
    
    SVEC
    
    ROUTE 11 (FREDRICK CO.)8.
    
    SVEC
    
    STEPHENS CITY (FREDRICK CO.)9.
    
    SVEC
    
    TRACKS (FREDRICK CO.)10.
    
    REC
    
    BERRYVILLE (CLARKE CO.)11.
    
    REC
    
    BOOM ROAD (CLARKE CO.)12.
    
    REC
    
    BOYCE (CLARKE CO.)13.
    
    REC
    
    WEBBTOWN HVD (CLARKE CO.)14.
    
    REC
    
    BERRYVILLE GRAPHICS (CLARKE CO.)15.
    
    SVEC
    
    CHEMSTONE (SHENANDOAH CO.)16.
    
    SVEC
    
    INDUSTRIAL (SHENANDOAH CO.)17.
    
    SVEC
    
    RESIDENTIAL (SHENANDOAH CO.)18.
    
    REC
    
    CLEARBROOK (FREDRICK CO.)19.
    
    REC
    
    EAST (FREDRICK & CLARKE CO.)20.
    
    REC
    
    SOUTH (FREDRICK & CLARKE CO.)21.
    
    REC
    
    WEST (FREDRICK CO.)22.
    
    REC
    
    DOUBLE TOLLGATE (CLARKE CO.)*23.
    
    REC
    
    ARMEL24.
    
    REC
    
    NEW TOWN (FREDRICK & WARREN CO.)25.
    
    REC
    
    ROUTE 522 (FREDRICK & CLARKE CO.)26.
    
    REC
    
    WHITE POST (CLARKE CO.)27.
    
    REC
    
    FRONT ROYAL (WARREN CO.)
 
 *
    
    Shared Location with real property and transmission
related assets retained by Seller. Annex A-1




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Party
    
    Substation/Circuit28.
    
    REC
    
    CHESTER GAP (WARREN & RAPPAHANNOCK CO.)29.
    
    REC
    
    GUARD HILL ROAD (WARREN CO.)30.
    
    REC
    
    OLD VA PACKING (WARREN CO.)31.
    
    SVEC
    
    GENERAL ELECTRIC (FREDRICK CO.)32.
    
    SVEC
    
    GORE (FREDRICK CO.)33.
    
    SVEC
    
    WHITACRE HVD (FREDRICK CO.)34.
    
    SVEC
    
    GREENWOOD (FREDRICK CO.)35.
    
    SVEC
    
    APPLE BLOSSOM MALL (FREDRICK CO.)36.
    
    SVEC
    
    BLACK BIRD (FREDRICK CO.)37.
    
    SVEC
    
    FREDERICK HEIGHTS (FREDRICK CO.)38.
    
    REC
    
    IZAAK WALTON (FREDRICK CO.)39.
    
    SVEC
    
    MILLWOOD AVENUE (FREDRICK CO.)40.
    
    SVEC
    
    PARKINS MILLS (FREDRICK CO.)41.
    
    REC
    
    SEWER NO. 1 (FREDRICK CO.)42.
    
    REC
    
    WOODSTOCK LANE (FREDRICK CO.)43.
    
    SVEC
    
    HAYFIELD (FREDRICK CO.)44.
    
    SVEC
    
    CHAMBERSVILLE (FREDRICK CO.)45.
    
    SVEC
    
    GAINSEBORO (FREDRICK CO.) (HAMPSHIRE & BERKELY CO.,WVA)46.
    
    SVEC
    
    SHAWNEELAND (FREDRICK CO.)47.
    
    SVEC
    
    KENT STREET (Abandoned)48.
    
    SVEC
    
    MAIN STREET49.
    
    SVEC
    
    WINC EAST50.
    
    SVEC
    
    KLINES MILL (FREDRICK CO.)*51.
    
    SVEC
    
    MARLBORO (FREDRICK & WARREN CO.)52.
    
    SVEC
    
    MIDDLETOWN (FREDRICK & SHENANDOAH CO.)53.
    
    REC
    
    LINDEN (WARREN CO.)54.
    
    REC
    
    APPLE MOUNTAIN (WARREN CO.)55.
    
    REC
    
    BLUE MOUNTAIN (WARREN & FAQUER CO.)56.
    
    REC
    
    HIGH KNOB (WARREN CO.)57.
    
    REC
    
    LINDEN TAP (WARREN CO.)58.
    
    REC
    
    HAPPY CREEK (WARREN & CLARKE CO.)59.
    
    REC
    
    SHENANDOAH SHORES (WARREN CO.)60.
    
    SVEC
    
    NORTH WINCHESTER (FREDRICK CO.)61.
    
    SVEC
    
    NATIONAL AVENUE (FREDRICK CO.)62.
    
    SVEC
    
    NORTH CAMERON STREET (FREDRICK CO.)63.
    
    SVEC
    
    NORTH KENT STREET (FREDRICK CO.)64.
    
    REC
    
    OLD CHAPEL (CLARKE CO.)65.
    
    REC
    
    BUCK MARSH (CLARKE CO.)66.
    
    REC
    
    ROUTE 632 (CLARKE CO.)67.
    
    REC
    
    REDBUD (FREDRICK CO.)68.
    
    REC
    
    BERRYVILLE AVE (FREDRICK CO.)69.
    
    REC
    
    FORT COLLIER (FREDRICK CO.)70.
    
    REC
    
    PARK CENTER (FREDRICK CO.)71.
    
    REC
    
    SEWER NO. 2 (FREDRICK CO.)72.
    
    REC
    
    SMITHFIELD FARMS (FREDRICK CO.)
 
 *
    
    Shared Location with both real property and
transmission related assets retained by Seller. Annex A-2




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Party
    
    Substation/Circuit73.
    
    REC
    
    STEPHENSON (FREDRICK CO.)74.
    
    REC
    
    SUNNY SIDE (FREDRICK CO.)75.
    
    REC
    
    WELLTOWN PIKE (FREDRICK CO.)76.
    
    REC
    
    RIVERTON (WARREN CO.)*77.
    
    REC
    
    I-66 (WARREN CO.)78.
    
    REC
    
    MARYS SHADY LANE (WARREN CO.)79.
    
    REC
    
    NINEVAH (WARREN CO.)80.
    
    SVEC
    
    SOUTH WINCHESTER (FREDRICK CO.)81.
    
    SVEC
    
    FRONT ROYAL PIKE (FREDRICK CO.)82.
    
    SVEC
    
    HOSPITAL (FREDRICK CO.)83.
    
    SVEC
    
    KERNTOWN (FREDRICK CO.)84.
    
    SVEC
    
    VALLEY PIKE (FREDRICK CO.)85.
    
    REC
    
    STEPHENSON (FREDRICK CO.)86.
    
    REC
    
    WHITEHALL (FREDRICK CO.)87.
    
    SVEC
    
    STRASBURG (SHENANDOAH CO.)88.
    
    SVEC
    
    AUTOMOTIVE INDUST (SHENANDOAH CO.)89.
    
    SVEC
    
    INDUSTRIAL (SHENANDOAH CO.)90.
    
    SVEC
    
    QUEEN STREET (SHENANDOAH CO.)91.
    
    SVEC
    
    STONESHOP (SHENANDOAH, WARREN, AND FREDRICK CO.)92.
    
    SVEC
    
    TOPNOT (SHENANDOAH, FREDRICK CO.)93.
    
    SVEC
    
    TOWN (SHENANDOAH CO.)94.
    
    SVEC
    
    VALLEY PRESS (SHENANDOAH CO.)95.
    
    SVEC
    
    SUCCESS ROAD (WARREN CO.)96.
    
    SVEC
    
    SUCCESS ROAD (WARREN CO.)97.
    
    SVEC
    
    WEST WINCHESTER (FREDRICK CO.)98.
    
    REC
    
    ALBIN (FREDRICK CO.)99.
    
    SVEC
    
    AMHERST (FREDRICK CO.)100.
    
    SVEC
    
    CEDAR CREEK GRADE (FREDRICK CO.)101.
    
    REC
    
    FOX DRIVE (FREDRICK CO.)102.
    
    SVEC
    
    MEADOWBRANCH (FREDRICK CO.)103.
    
    SVEC
    
    MEDICAL CENTER (FREDRICK CO.)104.
    
    SVEC
    
    ROUND HILL (FREDRICK CO.)105.
    
    SVEC
    
    WINCHESTER PUMP (WARREN CO.)106.
    
    SVEC
    
    WINCHESTER PUMP107.
    
    SVEC
    
    ZEPP TAP (SHENANDOAH CO.)108.
    
    SVEC
    
    ZEPP (SHENANDOAH & FREDRICK CO.)109.
    
    SVEC
    
    MONTEREY (HIGHLAND CO.)110.
    
    SVEC
    
    MONTEREY #1111.
    
    SVEC
    
    MONTEREY #2112.
    
    REC
    
    BARBOURSVILLE HVD (ORANGE CO.)113.
    
    REC
    
    BARBOURSVILLE (ORANGE CO.)114.
    
    REC
    
    CRIGGLERSVILLE HVD (MADISON CO.)115.
    
    REC
    
    CRIGGLERSVILLE (MADISON & RAPPAHANNOCK CO.)116.
    
    REC
    
    FLINT HILL (RAPPAHANNOCK CO.)117.
    
    REC
    
    AILEN (RAPPAHANNOCK CO.)
 
 *
    
    Shared Location with both real property and
transmission related assets retained by Seller. Annex A-3




---



##### 



Party
    
    Substation/Circuit118.
    
    REC
    
    HUNTLY (RAPPAHANNOCK CO.)119.
    
    REC
    
    ORLEANS (RAPPAHANNOCK & FAUQUIER CO.)120.
    
    REC
    
    PRATTS (MADISON CO.)121.
    
    REC
    
    BRIGHTWOOD (MADISON CO.)122.
    
    REC
    
    MADISON (MADISON CO.)123.
    
    REC
    
    SOMERSET (MADISON CO.)124.
    
    REC
    
    RUCKERSVILLE HVD (MADDISON CO.)125.
    
    REC
    
    RUCKERSVILLE (MADDISON & GREENE CO.)126.
    
    REC
    
    SPERRYVILLE (RAPPAHANNOCK CO.)127.
    
    REC
    
    WASHINGTON (RAPPAHANNOCK CO.)128.
    
    REC
    
    WOODVILLE (RAPPAHANNOCK & CULPEPPER CO.)129.
    
    REC
    
    STANDARDSVILLE (GREENE CO.)130.
    
    REC
    
    SWIFT RUN GAP (GREENE CO.)131.
    
    REC
    
    WOLFTOWN (GREENE CO.)132.
    
    SVEC
    
    CARVELL RD. JUNCTION HV (PAGE CO.)133.
    
    SVEC
    
    CARVELL ROAD (PAGE & WARREN CO.)134.
    
    REC
    
    FRONT ROYAL (WARREN CO.)135.
    
    SVEC
    
    BENTONVILLE (WARREN & PAGE CO.)136.
    
    SVEC
    
    FORK DISTRICT (WARREN & PAGE CO.)137.
    
    SVEC
    
    PAGE (PAGE CO.)*138.
    
    SVEC
    
    340 NORTH (PAGE CO.)139.
    
    SVEC
    
    FAIRVIEW (PAGE CO.)140.
    
    SVEC
    
    HAWKSBILL (PAGE CO.)141.
    
    SVEC
    
    INDUSTRIAL (PAGE CO.)142.
    
    SVEC
    
    MARYE LANE (PAGE CO.)143.
    
    SVEC
    
    WHITEHOUSE (PAGE CO.)144.
    
    SVEC
    
    SHENANDOAH (PAGE CO.)*145.
    
    SVEC
    
    CUB RUN (PAGE CO.)146.
    
    SVEC
    
    VERBENA (PAGE CO.)147.
    
    SVEC
    
    VIRGINIA AVE FDR (PAGE CO.)148.
    
    SVEC
    
    NORTH SHENANDOAH149.
    
    SVEC
    
    STANLEY (PAGE CO.)150.
    
    SVEC
    
    ALMA (PAGE CO.)151.
    
    SVEC
    
    HONEYVILLE (PAGE CO.)152.
    
    SVEC
    
    TOWN FEEDER (PAGE CO.)153.
    
    REC
    
    VISCOSE154.
    
    REC
    
    KENDRICK LAND S.S. (OWNED BY TOWN OF FRONT ROYAL)
 
 *
    
    Shared Location with both real property and
transmission related assets retained by Seller. Annex A-4




---



##### 



Chart B
Sub-transmission Lines
 Cooperative/From
    
    To
    
    Sec. Name
    
    Diagram Location1.
    
    Abex Corp. Tap
    
    Abex Corp.
    
    (customer tap)
    
    SVEC2.
    
    Abex Corp. Tap
    
    South Winchester
    
    GS4
    
    SVEC3.
    
    Americold
    
    Strasburg
    
    NS5
    
    REC4.
    
    Barboursville
    
    Virginia Power
    
    VP
    
    REC5.
    
    Bartonville
    
    General Electric
    
    BGE
    
    SVEC6.
    
    Bartonville
    
    H.P. Hood
    
    TN1
    
    SVEC7.
    
    Berryville
    
    Berryville Graphics (Doubleday)
    
    DD
    
    REC8.
    
    Berryville
    
    Old Chapel
    
    BT3
    
    REC9.
    
    Bunker Hill Jct. (former)
    
    Clearbrook Tap
    
    MW1
    
    REC10.
    
    Capitol Records Tap
    
    Capitol Records
    
    (customer tap)
    
    SVEC11.
    
    Capitol Records Tap
    
    Rubbermaid
    
    GS2
    
    SVEC12.
    
    Chemstone
    
    Valley Asphalt
    
    NS3
    
    SVEC13.
    
    Chemstone
    
    Grove Lime
    
    NS2
    
    SVEC14.
    
    Clearbrook Tap
    
    Clearbrook
    
    (substation tap)
    
    REC15.
    
    Clearbrook Tap
    
    Zuckerman Tap
    
    MW2
    
    REC16.
    
    Criglersville
    
    Pratts
    
    HP3
    
    REC17.
    
    Crown Cork & Seal
    
    Westminster Canterbury
    
    BW2
    
    REC18.
    
    Cumberland Homes
    
    Viscose
    
    SF1
    
    SVEC19.
    
    Decapolis Tap
    
    Criglersville
    
    HP2
    
    REC20.
    
    Decapolis Tap
    
    Decapolis
    
    (substation tap)
    
    REC21.
    
    Double Toll Gate
    
    H.P. Hood
    
    TN1
    
    SVEC22.
    
    Double Toll Gate
    
    Berryville
    
    BT1 & BT2
    
    REC23.
    
    Double Toll Gate
    
    Family Dollar
    
    TD1
    
    REC24.
    
    Double Toll Gate
    
    Technicon Corp.
    
    NS
    
    REC25.
    
    Family Dollar
    
    Success Road
    
    TD2
    
    REC26.
    
    Flint Hill
    
    Sperryville
    
    SP3
    
    REC27.
    
    Front Royal
    
    Sprint
    
    SP1
    
    REC28.
    
    General Electric
    
    Capitol Records Tap
    
    GS1
    
    SVEC29.
    
    Gore
    
    Capon Bridge
    
    GC
    
    SVEC30.
    
    Hayfield
    
    Unisil Tap
    
    VG4
    
    SVEC31.
    
    Hazel
    
    Decapolis Tap
    
    HP1
    
    REC32.
    
    Hazel
    
    ODEC (Rixley)
    
    HR
    
    REC33.
    
    Hazel
    
    Virginia Power (Culpeper)
    
    HC
    
    REC34.
    
    Hershey Pasta
    
    Southeast Container
    
    RW0
    
    REC35.
    
    Linden Tap
    
    Front Royal
    
    RF2
    
    REC36.
    
    Linden Tap
    
    Linden
    
    LD
    
    REC37.
    
    Luray Hydro Jct. (LN/PT)
    
    Luray Hydro
    
    PT2
    
    SVEC
 Annex A-5




---



##### 



Cooperative/From
    
    To
    
    Sec. Name
    
    Diagram Location38.
    
    Luray Hydro Jct. (LN/PT)
    
    Stanley
    
    LN1
    
    SVEC39.
    
    North Shenandoah
    
    Newport
    
    NN
    
    SVEC40.
    
    North Winchester
    
    OSullivan Rubber Tap
    
    SW
    
    SVEC41.
    
    Old Chapel
    
    Gaylord
    
    GO
    
    REC42.
    
    OSullivan Harris Tap
    
    Abex Corp. Tap
    
    GS3
    
    SVEC43.
    
    OSullivan Harris Tap
    
    OSullivan Harris
    
    (customer tap)
    
    SVEC44.
    
    OSullivan Rubber Tap
    
    OSullivan Rubber
    
    (customer tap)
    
    SVEC45.
    
    OSullivan Rubber Tap
    
    South Winchester
    
    SW1
    
    SVEC46.
    
    Page
    
    Wrangler Annex Tap
    
    PF
    
    SVEC47.
    
    Page
    
    Wrangler Tap
    
    PC1
    
    SVEC48.
    
    Panorama
    
    Sperryville
    
    PC3
    
    SVEC49.
    
    Pen-Tab
    
    Dupont Front Royal
    
    DR2
    
    REC50.
    
    Perry
    
    Valley Protein
    
    VG2
    
    SVEC51.
    
    Pratts
    
    Webster Brick
    
    BB5
    
    REC52.
    
    Redbud
    
    Crown Cork & Seal
    
    BW1
    
    REC53.
    
    Redbud
    
    Gaylord
    
    RK
    
    REC54.
    
    Redbud
    
    Hershey Pasta
    
    RW
    
    REC55.
    
    Redbud
    
    North Winchester
    
    NR
    
    REC56.
    
    Riverton
    
    Pen-Tab
    
    DR1
    
    REC57.
    
    Riverton
    
    Riverton Lime
    
    TR1
    
    REC58.
    
    Riverton
    
    Warren Hydro Tap
    
    RF1
    
    REC59.
    
    Riverton Lime
    
    Front Royal
    
    TR2
    
    REC60.
    
    Rubbermaid
    
    OSullivan Harris Tap
    
    GS2
    
    SVEC61.
    
    Ruckersville Tap
    
    Pratts
    
    SR4
    
    REC62.
    
    Shenandoah
    
    North Shenandoah
    
    SN
    
    SVEC63.
    
    Shenandoah
    
    Shenandoah Hydro
    
    HS
    
    SVEC64.
    
    Shenandoah
    
    Stanardsville
    
    SR1
    
    REC65.
    
    South Winchester
    
    West Winchester
    
    WS
    
    SVEC66.
    
    South Winchester
    
    West Winchester
    
    WW
    
    SVEC67.
    
    Southeast Container
    
    North Winchester
    
    RW1
    
    SVEC68.
    
    Sperryville
    
    Hazel
    
    SV
    
    REC69.
    
    Sprint
    
    Flint Hill
    
    SP2
    
    REC70.
    
    Stanardsville
    
    Wolftown Tap
    
    SR2
    
    REC71.
    
    Stanley
    
    Newport
    
    LN2
    
    SVEC72.
    
    Strasburg
    
    Virginia Power (Fishers Hill)
    
    FH
    
    SVEC
 Annex A-6




---



##### 



Cooperative/From
    
    To
    
    Sec. Name
    
    Diagram Location73.
    
    Strasburg
    
    Winchester Pump Tap
    
    SF
    
    SVEC74.
    
    Strasburg
    
    Zepp Tap
    
    BA1
    
    SVEC75.
    
    Success Road
    
    Toray Plastics
    
    TD3
    
    REC76.
    
    Technicon Corp.
    
    Grove Lime
    
    NS1
    
    SVEC77.
    
    Toray Plastics
    
    Dupont Front Royal
    
    TD4
    
    REC78.
    
    Unisil Tap
    
    Gore
    
    VG5
    
    SVEC79.
    
    Unisil Tap
    
    Unisil
    
    (customer tap)
    
    SVEC80.
    
    Valley Asphalt
    
    Americold
    
    NS4
    
    SVEC81.
    
    Valley Protein
    
    Hayfield
    
    VG3
    
    SVEC82.
    
    Viscose
    
    Front Royal
    
    VR
    
    REC83.
    
    Warren Hydro Tap
    
    Linden Tap
    
    RF1
    
    REC84.
    
    Warren Hydro Tap
    
    Warren Hydro
    
    WR
    
    REC85.
    
    Webster Brick
    
    Barboursville
    
    VP
    
    REC86.
    
    Westminster Canterbury
    
    West Winchester
    
    BW3
    
    REC87.
    
    West Winchester
    
    Perry
    
    VG1
    
    SVEC88.
    
    Winchester Pump Tap
    
    Cumberland Homes
    
    SF0
    
    SVEC89.
    
    Winchester Pump Tap
    
    Winchester Pump
    
    WP
    
    SVEC90.
    
    Wolftown Tap
    
    Ruckersville Tap
    
    SR3
    
    REC91.
    
    Wrangler Annex Tap
    
    Luray Hydro Jct. (LN/PT)
    
    PT1
    
    SVEC92.
    
    Wrangler Annex Tap
    
    Wrangler Annex
    
    (customer tap)
    
    SVEC93.
    
    Wrangler Tap
    
    Panorama
    
    PC2
    
    SVEC94.
    
    Wrangler Tap
    
    Wrangler
    
    (customer tap)
    
    SVEC95.
    
    Zepp Tap
    
    Wardensville
    
    BA2
    
    SVEC96.
    
    Zuckerman Tap
    
    Redbud
    
    MW2
    
    REC97.
    
    Zuckerman Tap
    
    Zuckerman
    
    (customer tap)
    
    REC98.
    
    Dublin 166 WVA-VA line (69kv)
    
    Monterey
    
    
    
    SVEC
 Annex A Article II
 Annex A-7




---



##### 



EXHIBIT A
 DEFINITIONS
 Exhibit
A Exhibit A
 Accounts Receivable
 Accounts Receivable Purchase Amount times plus times
 Affiliate
 Agreement
 Assignment and Assumption Agreement Exhibit B
 Auction Revenue Rights
 Business Day
 Buyer Material Adverse Effect
 Exhibit A-1




---



##### 



Buyer Representatives
 Buyers Shared Equipment
 CERCLA
 Claims 
 COBRA
 Code
 Collective Bargaining Agreement
 Commitment Letters
 Contract
 Confidentiality Agreement
 Congestion Revenue Rights CRR
 Correction Adjustment
 Exhibit A-2




---



##### 



Current Assets
 Current Liabilities
 Customer Deposits provided that
 Designated Assets Value plus less
 Distribution Facilities
 Easements
 Employees Schedule 5.13(d)
 Employee Stock Ownership and Savings Plan 
 Encumbrances
 Environmental Conditions
 Exhibit A-3




---



##### 



Environmental Laws
 ERISA
 Exchange Act
 FERC
 Final Order
 Final Purchase Price plus minus Section 3.2(d) plus Section 3.2(f)
 Financial Transmission Right FTR
 FIRPTA Affidavit
 GAAP
 Good Utility Practices
 Exhibit A-4




---



##### 



Governmental Entity
 Hazardous Substance
 Holding Company Act
 HSR Act
 Income Tax
 Independent Accounting Firm
 Intellectual Property
 Inventories
 Exhibit A-5




---



##### 



Laws
 Liabilities
 Losses
 LSE
 Material Adverse Effect
 Net Book Value of the Acquired Assets less Schedule 5.5 Schedule 5.5
 Off-Site Location
 Order
 Permits
 Exhibit A-6




---



##### 



Permitted Encumbrances
       Schedule 5.14(a)
   Person
 PJM
 PJM Agreements
 Exhibit A-7




---



##### 



PJM Load Zone
 PJM OATT PJM Tariff
 PJM Operating Agreement
 PJM RAA
 PJM West RAA
 Power Purchase Agreements
 Regulatory Assets Schedule 2.1(u)
 Regulatory Liabilities Schedule 2.1(u)
 Related Agreements Section
7.24
 Release
 Exhibit A-8




---



##### 



Remediation
 Representatives
 Sales Taxes
 Securities Act
 Sellers Knowledge Knowledge of Seller Schedule A(76)
 Sellers Representatives
 Sellers Separation Allowance Plan
 Sellers Shared Equipment
 Site
 Exhibit A-9




---



##### 



Straddle Period
 Subsidiary
 Taxes
 Tax Return
 Transfer Taxes
 Transferable Permits
 Transferring Employee Records
 Transition Services Agreement
 Transmission Facilities
 Unbilled Revenue
 Virginia Commission
 Exhibit A-10




---



##### 



Virginia Settlement
 WARN Act
 Wholesale Power Contract
  Term
    
    Section2008 Statement
    
    5.5(a)Acquired Assets
    
    2.1Acquired Intellectual Property
    
    2.1(o)Agreement
    
    PreambleAllegheny
    
    5.9Allocation
    
    3.3Applicable Rate
    
    3.2(d)Assumed Obligations
    
    2.3Bankruptcy and Equity Exception
    
    5.2Benefit Arrangement
    
    5.13(b)Benefit Plans
    
    5.13(a)Benefits Continuation Period
    
    7.8(b)Buyer
    
    PreambleBuyer Benefit Plans
    
    7.8(c)Buyer Indemnified Parties
    
    9.2(a)Buyer Required Regulatory Approvals
    
    6.3(b)Buyers Shared Equipment
    
    2.1(c)Closing
    
    4.1Closing Date
    
    4.1Closing Payment
    
    3.1(b)Closing Statement
    
    3.2(a)Closing Statement Review Period
    
    3.2(b)Commercial Arbitration Rules
    
    11.13(c)Communication Facilities Agreement
    
    7.14(b)De Minimis Loss
    
    9.2(a)Direct Claim
    
    9.3(c)Disclosure Schedules
    
    11.9DOJ
    
    7.3(c)Effective Time
    
    4.1Eligible Employees
    
    7.8(a)Entitled Party
    
    7.4(b)
 Exhibit A-11




---



##### 



Term
    
    SectionEquipment Leases
    
    2.1(h)Estimated NBV
    
    3.1(b)Excluded Assets
    
    2.2Excluded Easements
    
    2.2(b)Excluded Real Property
    
    2.2(a)Excluded Tangible Personal Property
    
    2.2(k)Final NBV
    
    3.2(c)Financial Statements
    
    5.4(a)FTC
    
    7.3(c)Hire Date
    
    7.8(b)Indemnifiable Loss
    
    9.2(a)Indemnifying Party
    
    9.2(d)Indemnitee
    
    9.2(c)Independent Accounting Firm Closing Statement Determination
    
    3.2(b)Independent Accounting Firm Partner
    
    3.2(b)Initial 2008 Statement
    
    5.5(a)Interchange Agreement
    
    7.22Leave Employees
    
    7.8(a)ODEC
    
    RecitalsOwned Real Property
    
    2.1(a)Post-Closing Allocation
    
    3.3PPA Assignment and Assumpyion Agreement
    
    7.23Prior Welfare Plans
    
    7.8(b)Purchase Price Certificate
    
    3.1(b)Receiving Party
    
    7.4(b)Regulatory Undertakings
    
    7.3(e)Replacement Welfare Plans
    
    7.8(b)Retained Intellectual Property
    
    2.2(j)Retained Obligations
    
    2.4Seller
    
    PreambleSeller Indemnified Parties
    
    9.2(b)Seller Lease Buy-Out
    
    2.5Seller Required Regulatory Approvals
    
    5.3(b)Seller Third-Party Consents
    
    5.3(a)Shared Contracts
    
    2.2(f)Shared Facilities
    
    7.12(c)Shared Facilities Agreement
    
    7.12(c)Shared Location
    
    2.1(c)Sister Business
    
    RecitalsSister Purchase Agreement
    
    RecitalsSVEC
    
    RecitalsTangible Personal Property
    
    2.1(g)Tax Audit
    
    7.7(e)(i)Termination Date
    
    10.1(b)
 Exhibit A-12




---



##### 



Term
    
    SectionThird Party Claim
    
    9.3(a)TrAIL Project Lines
    
    7.16(b)TrAIL Agreement
    
    7.16(b)Transferred Business
    
    RecitalsTransferred Contracts
    
    2.1(i)Transferred Easements
    
    2.1(b)Transferred Territory
    
    RecitalsTransferring Employees
    
    7.8(a)VA Distribution Business
    
    RecitalsWARN Notice Requirements
    
    7.8(h)
 PRINCIPLES OF CONSTRUCTION
           Exhibit A-13




---



##### 



provided that
 Exhibit A-14