Document:

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                                                                     EXHIBIT 4.4
                          REGISTRATION RIGHTS AGREEMENT

                             Dated January 11, 2001

                                      among

                          The Williams Companies, Inc.

                                       and

                                 UBS Warburg LLC
                     Credit Suisse First Boston Corporation
                              Lehman Brothers Inc.
                              ABN AMRO Incorporated
                         Banc of America Securities LLC
                             BMO Nesbitt Burns Corp.
                             Commerzbank Securities
                           Credit Lyonnais Securities
                         The Royal Bank of Scotland PLC
                             Scotia Capital Markets
                                  TD Securities

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                          REGISTRATION RIGHTS AGREEMENT

                  THIS REGISTRATION RIGHTS AGREEMENT (the "Agreement") is made
and entered into January 11, 2001 between THE WILLIAMS COMPANIES, INC., a
corporation duly organized and existing under the laws of the State of Delaware
(the "Company"), and UBS Warburg LLC, Credit Suisse First Boston Corporation,
Lehman Brothers Inc., ABN AMRO Incorporated, Banc of America Securities LLC, BMO
Nesbitt Burns Corp., Commerzbank Securities, Credit Lyonnais Securities, The
Royal Bank of Scotland PLC, Scotia Capital Markets and TD Securities (the
"Initial Purchasers").

                  This Agreement is made pursuant to the Purchase Agreement
dated January 11, 2001, among the Company, UBS AG, acting through its London
Branch and the Initial Purchasers (the "Purchase Agreement"), which provides for
the purchase by the Initial Purchasers of an aggregate of $700,000,000 principal
amount of the Company's 7.50% Debentures due January 15, 2031 and $400,000,000
principal amount of the Company's 6.75% Putable Asset Term Securities
Putable/Callable on January 15, 2006 (collectively, the "Securities"). The
Company hereby agrees to provide to the Initial Purchasers and its direct and
indirect transferees the registration rights set forth in this Agreement.

                  In consideration of the foregoing, the parties hereto agree as
follows:

                  1. Definitions.

                  As used in this Agreement, the following capitalized defined
terms shall have the following meanings:

                  "1933 Act" shall mean the Securities Act of 1933, as amended
         from time to time.

                  "1934 Act" shall mean the Securities Exchange Act of 1934, as
         amended from time to time.

                  "Company" shall have the meaning set forth in the preamble and
         shall also include the Company's successors.

                  "Exchange Dates" shall have the meaning set forth in Section
         2(a) hereof.

                  "Exchange Offer" shall mean the exchange offer by the Company
         of Exchange Securities for Registrable Securities pursuant to Section
         2(a) hereof.

                  "Exchange Offer Registration" shall mean a registration under
         the 1933 Act effected pursuant to Section 2(a) hereof.

                  "Exchange Offer Registration Statement" shall mean a
         registration statement on Form S-4 (or, if applicable, on another
         appropriate form) relating to an offering of Exchange Securities
         pursuant to an Exchange Offer and all amendments and supplements to
         such registration statement, in each case including the Prospectus
         contained therein, all exhibits thereto and all material incorporated
         by reference therein.

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                  "Exchange Securities" shall mean securities issued by the
         Company under the Indenture containing terms identical to the
         Securities (except that the Exchange Securities will not contain
         restrictions on transfer or terms regarding the payment of additional
         interest as provided in Section 2(d) hereof) and to be offered to
         Holders of Securities in exchange for Securities pursuant to the
         Exchange Offer.

                  "Holder" shall mean each Initial Purchaser, for so long as it
         owns any Registrable Securities, and each of its successors, assigns
         and direct and indirect transferees who become registered owners of
         Registrable Securities under the Indenture; provided that for purposes
         of Sections 4 and 5 of this Agreement, the term "Holder" shall include
         Participating Broker-Dealers (as defined in Section 4(a)).

                  "Indenture" shall mean the Indenture relating to the
         Securities dated as of November 10, 1997, as supplemented by a First
         Supplemental Indenture dated as of September 8, 2000, a Second
         Supplemental Indenture dated as of December 7, 2000, a Third
         Supplemental Indenture, dated as of December 20, 2000, a Fourth
         Supplemental Indenture dated as of January 17, 2001 and a Fifth
         Supplemental Indenture dated as of January 17, 2001 each between the
         Company and Bank One Trust Company, N.A., as trustee, as the same may
         be amended from time to time in accordance with the terms thereof.

                  "Initial Purchasers" shall have the meaning set forth in the
         preamble.

                  "Majority Holders" shall mean the Holders of a majority of the
         aggregate principal amount of outstanding Registrable Securities;
         provided that whenever the consent or approval of Holders of a
         specified percentage of Registrable Securities is required hereunder,
         Registrable Securities held by the Company or any of its affiliates (as
         such term is defined in Rule 405 under the 1933 Act) (other than the
         Initial Purchasers or subsequent Holders of Registrable Securities if
         such subsequent Holders are deemed to be such affiliates solely by
         reason of their holding of such Registrable Securities) shall not be
         counted in determining whether such consent or approval was given by
         the Holders of such required percentage or amount.

                  "Person" shall mean an individual, partnership, limited
         liability company, corporation, trust or unincorporated organization,
         or a government or agency or political subdivision thereof.

                  "Prospectus" shall mean the prospectus included in a
         Registration Statement, including any preliminary prospectus, and any
         such prospectus as amended or supplemented by any prospectus
         supplement, including a prospectus supplement with respect to the terms
         of the offering of any portion of the Registrable Securities covered by
         a Shelf Registration Statement, and by all other amendments and
         supplements to such prospectus, and in each case including all material
         incorporated by reference therein.

                  "Purchase Agreement" shall have the meaning set forth in the
         preamble.

                  "Registrable Securities" shall mean the Securities; provided,
         however, that the Securities shall cease to be Registrable Securities
         (i) when a Registration Statement with

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         respect to such Securities shall have been declared effective under the
         1933 Act and such Securities shall have been exchanged for Exchange
         Securities pursuant to an Exchange Offer Registration Statement or
         disposed of pursuant to a Shelf Registration Statement, as applicable,
         (ii) when such Securities have been sold to the public pursuant to Rule
         144 under the 1933 Act or are saleable pursuant to Rule 144(k) under
         the 1933 Act (or any similar provisions then in force, but not Rule
         144A) or (iii) when such Securities shall have ceased to be
         outstanding.

                  "Registration Expenses" shall mean any and all expenses
         incident to performance of or compliance by the Company with this
         Agreement, including without limitation: (i) all SEC, stock exchange or
         National Association of Securities Dealers, Inc. registration and
         filing fees, (ii) all fees and expenses incurred in connection with
         compliance with state securities or blue sky laws (including reasonable
         fees and disbursements of counsel for any underwriters or Holders in
         connection with blue sky qualification of any of the Exchange
         Securities or Registrable Securities), (iii) all expenses of any
         Persons in preparing or assisting in preparing, word processing,
         printing and distributing any Registration Statement, any Prospectus
         (including any amendments or supplements thereto), any underwriting
         agreements, securities sales agreements and other documents relating to
         the performance of and compliance with this Agreement, (iv) all rating
         agency fees, (v) all fees and disbursements relating to the
         qualification of the Indenture under applicable securities laws, (vi)
         the fees and disbursements of the Trustee and its counsel, (vii) the
         fees and disbursements of counsel for the Company and, in the case of a
         Shelf Registration Statement, the reasonable fees and disbursements of
         one counsel for the Holders (which counsel shall be selected by the
         Majority Holders and which counsel may also be counsel for the Initial
         Purchasers) and (viii) the fees and disbursements of the independent
         public accountants of the Company, including the expenses of any
         special audits or "cold comfort" letters required by or incident to
         such performance and compliance, but excluding fees and expenses of
         counsel to the underwriters (other than fees and expenses set forth in
         clause (ii) above) or the Holders and underwriting discounts and
         commissions and transfer taxes, if any, relating to the sale or
         disposition of Registrable Securities by a Holder.

                  "Registration Statement" shall mean any registration statement
         of the Company that covers any of the Exchange Securities or
         Registrable Securities pursuant to the provisions of this Agreement and
         all amendments and supplements to any such Registration Statement,
         including post-effective amendments, in each case including the
         Prospectus contained therein, all exhibits thereto and all material
         incorporated by reference therein.

                  "SEC" shall mean the Securities and Exchange Commission.

                  "Shelf Registration" shall mean a registration effected
         pursuant to Section 2(b) hereof.

                  "Shelf Registration Statement" shall mean a "shelf"
         registration statement of the Company pursuant to the provisions of
         Section 2(b) of this Agreement which covers all of the Registrable
         Securities (but no other securities unless approved by the Holders of a

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         majority of the aggregate principal amount of outstanding Registrable
         Securities that are covered by such Shelf Registration Statement) on an
         appropriate form under Rule 415 under the 1933 Act, or any similar rule
         that may be adopted by the SEC, and all amendments and supplements to
         such registration statement, including post-effective amendments, in
         each case including the Prospectus contained therein, all exhibits
         thereto and all material incorporated by reference therein.

                  "Time of Delivery" shall have the meaning set forth in the
         Purchase Agreement.

                  "Trustee" shall mean the trustee with respect to the
         Securities under the Indenture.

                  "Underwriter" shall have the meaning set forth in Section 3
         hereof.

                  "Underwritten Registration" or "Underwritten Offering" shall
         mean a registration in which Registrable Securities are sold to an
         Underwriter for reoffering to the public.

                  2. Registration Under the 1933 Act.

                  (a) To the extent not prohibited by any applicable law or
applicable interpretation of the Staff of the SEC, the Company shall use its
reasonable best efforts (1) to cause to be filed an Exchange Offer Registration
Statement within 120 days following the Time of Delivery covering the offer by
the Company to the Holders to exchange all of the Registrable Securities for an
equal aggregate principal amount of Exchange Securities and (2) to cause such
Exchange Offer Registration Statement to become effective within 180 days
following the Time of Delivery. The Company shall use commercially reasonable
efforts to have the Exchange Offer Registration Statement remain effective until
the closing of the Exchange Offer. The Company shall commence the Exchange Offer
promptly after the Exchange Offer Registration Statement has been declared
effective by the SEC and use its commercially reasonable efforts to have the
Exchange Offer consummated not later than 60 days after such effective date. The
Company shall commence the Exchange Offer by mailing the related exchange offer
Prospectus and accompanying documents to each Holder stating, in addition to
such other disclosures as are required by applicable law:

                  (i) that the Exchange Offer is being made pursuant to this
         Registration Rights Agreement and that all Registrable Securities
         validly tendered will be accepted for exchange;

                  (ii) the dates of acceptance for exchange (which shall be a
         period of at least 20 business days from the date such notice is
         mailed) (the "Exchange Dates");

                  (iii) that any Registrable Security not tendered will remain
         outstanding and continue to accrue interest, but will not retain any
         rights under this Registration Rights Agreement;

                  (iv) that Holders electing to have a Registrable Security
         exchanged pursuant to the Exchange Offer will be required to surrender
         such Registrable Security, together with the enclosed letters of
         transmittal, to the institution and at the address (located in the

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         Borough of Manhattan, The City of New York) specified in the notice
         prior to the close of business on the last Exchange Date; and

                  (v) that Holders will be entitled to withdraw their election,
         not later than the close of business on the last Exchange Date, by
         sending to the institution and at the address (located in the Borough
         of Manhattan, The City of New York) specified in the notice a telegram,
         telex, facsimile transmission or letter (to be received no later than
         the Exchange Date) setting forth the name of such Holder, the principal
         amount of Registrable Securities delivered for exchange and a statement
         that such Holder is withdrawing his election to have such Securities
         exchanged.

                  As soon as practicable after the last Exchange Date, the
         Company shall:

                  (i) accept for exchange Registrable Securities or portions
         thereof validly tendered and not validly withdrawn pursuant to the
         Exchange Offer; and

                  (ii) deliver, or cause to be delivered, to the Trustee for
         cancellation all Registrable Securities or portions thereof so accepted
         for exchange by the Company and issue, and cause the Trustee to
         promptly authenticate and mail to each Holder, an Exchange Security
         equal in principal amount to the principal amount of the Registrable
         Securities surrendered by such Holder.

The Company shall use its commercially reasonable efforts to complete the
Exchange Offer as provided above and shall comply with the applicable
requirements of the 1933 Act, the 1934 Act and other applicable laws and
regulations in connection with the Exchange Offer. The Exchange Offer shall not
be subject to any conditions, other than that the Exchange Offer does not
violate applicable law or any applicable interpretation of the Staff of the SEC.
The Company shall inform the Initial Purchaser of the names and addresses of the
Holders to whom the Exchange Offer is made, and the Initial Purchaser shall have
the right, subject to applicable law, to contact such Holders and otherwise
facilitate the tender of Registrable Securities in the Exchange Offer.

If, during the period the Exchange Offer Registration Statement is effective, an
event occurs which makes any statement made in such Exchange Offer Registration
Statement or the related Prospectus untrue in any material respect or which
requires the making of any changes in such Exchange Offer Registration Statement
or Prospectus in order to make the statement therein not misleading, the Company
shall use commercially reasonable efforts to prepare and file with the SEC a
supplement or post-effective amendment to the Exchange Offer Registration
Statement or the related Prospectus or any document incorporated therein by
reference or file any other required document so that, as thereafter delivered
to the purchasers of the Registrable Securities, such Prospectus will not
contain any untrue statement of a material fact or omit to state a material fact
necessary to make the statements therein, in light of the circumstances under
which they were made, not misleading. The Company agrees to notify the Holders
to suspend the exchange of the Registrable Securities as promptly as practicable
after the occurrence of such an event, and the Holders hereby agree to suspend
such exchange until the Company has amended or supplemented the Prospectus to
correct such misstatement or omission.

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                  (b) If (i) the Company determines that the Exchange Offer
Registration provided for in Section 2(a) above is not available or may not be
consummated as soon as practicable after the last Exchange Date because it would
violate applicable law or the applicable interpretations of the Staff of the
SEC, (ii) the Exchange Offer is not for any other reason consummated within 240
days following the Time of Delivery or (iii) in the written opinion of counsel
for the Holders a Shelf Registration Statement must be filed and a Prospectus
must be delivered by any Holder in connection with any reoffering or resale of
Registrable Securities, the Company shall use commercially reasonable efforts to
(x) file with the SEC within 120 days following such determination, date or
notice of such opinion of counsel is given to the Company a Shelf Registration
Statement providing for the resale by the Holders (other than those who fail to
comply with the paragraph immediately following clause (p) of Section 3) of all
of their Registrable Securities and (y) cause such Shelf Registration Statement
to become effective within 60 days thereafter. If the Company is required to
file a Shelf Registration Statement solely as a result of the matters referred
to in clause (iii) of the preceding sentence, the Company shall use commercially
reasonable efforts to file and have declared effective by the SEC both an
Exchange Offer Registration Statement pursuant to Section 2(a) with respect to
all Registrable Securities and a Shelf Registration Statement (which may be a
combined Registration Statement with the Exchange Offer Registration Statement)
with respect to reoffers and resales of Registrable Securities held by the
Holders who must deliver the related Prospectus. The Company agrees to use
commercially reasonable efforts to keep the Shelf Registration Statement
continuously effective until the expiration of the period referred to in Rule
144(k) with respect to the Registrable Securities or such shorter period that
will terminate when all of the Registrable Securities covered by the Shelf
Registration Statement have been sold pursuant to the Shelf Registration
Statement or cease to be Registrable Securities within the meaning of this
Agreement. The Company further agrees to supplement or amend the Shelf
Registration Statement if required by the rules, regulations or instructions
applicable to the registration form used by the Company for such Shelf
Registration Statement or by the 1933 Act or by any other rules and regulations
thereunder for shelf registration or if reasonably requested by a Holder with
respect to information relating to such Holder, and to use commercially
reasonable efforts to cause any such amendment to become effective and such
Shelf Registration Statement to become usable as soon as thereafter practicable.
The Company agrees to furnish to the Holders of Registrable Securities copies of
any such supplement or amendment promptly after its being used or filed with the
SEC.

                  (c) The Company shall pay all Registration Expenses in
connection with the registration pursuant to Section 2(a) or Section 2(b). Each
Holder shall pay all underwriting discounts and commissions and transfer taxes,
if any, relating to the sale or disposition of such Holder's Registrable
Securities pursuant to the Shelf Registration Statement.

                  (d) An Exchange Offer Registration Statement pursuant to
Section 2(a) hereof or a Shelf Registration Statement pursuant to Section 2(b)
hereof will not be deemed to have become effective unless it has been declared
effective by the SEC; provided, however, that, if, after it has been declared
effective, the offering of Registrable Securities pursuant to a Shelf
Registration Statement is interfered with by any stop order, injunction or other
order or requirement of the SEC or any other governmental agency or court, such
Registration Statement will be deemed not to have become effective during the
period of such interference until the

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offering of Registrable Securities pursuant to such Registration Statement may
legally resume. If:

                  (i) the Exchange Offer Registration Statement and, if a Shelf
         Registration Statement is required hereby, the Shelf Registration
         Statement is not filed with the SEC on or prior to the date specified
         for such filing in Section 2(a) and Section 2(b), respectively,

                  (ii) the Exchange Offer Registration Statement and, if a Shelf
         Registration Statement is required hereby, the Shelf Registration
         Statement is not declared effective on or prior to the date specified
         for such effectiveness in Section 2(a) and Section 2(b), respectively,

                  (iii) the Exchange Offer is not consummated on or prior to the
         date specified in Section 2(a), or

                  (iv) the Company has filed, and the SEC has declared
         effective, the Shelf Registration Statement and at any time prior to
         the expiration of the period referred to in Rule 144(k) with respect to
         the Registrable Securities, other than after all the Registrable
         Securities have been disposed of under the Shelf Registration Statement
         or cease to be Registrable Securities, the Shelf Registration Statement
         ceases to be effective, or fails to be usable for its intended purpose
         without being succeeded within two business days by a post-effective
         amendment which cures the failure and that is itself immediately
         declared effective,

then in the case of any failure set forth in (i) - (iv) above, the per annum
interest rate on the Securities will increase by 0.25% until the date that the
relevant failure is remedied.

                   (e) Without limiting the remedies available to the Holders,
the Company acknowledges that any failure by the Company to comply with its
obligations under Section 2(a) and Section 2(b) hereof may result in material
irreparable injury to the Holders for which there is no adequate remedy at law,
that it will not be possible to measure damages for such injuries precisely and
that, in the event of any such failure, the Initial Purchasers or any Holder may
obtain such relief as may be required to specifically enforce the Company's
obligations under Section 2(a) and Section 2(b) hereof.

                  3. Registration Procedures.

                  In connection with the obligations of the Company with respect
to the Registration Statements pursuant to Section 2(a) and Section 2(b) hereof,
the Company shall as expeditiously as possible (provided, however, that the
Company shall not be required to take actions more promptly than required by
Sections 2(a) and 2(b)):

                  (a) prepare and file with the SEC a Registration Statement on
         the appropriate form under the 1933 Act, which form (x) shall be
         selected by the Company and (y) shall, in the case of a Shelf
         Registration, be available for the resale of the Registrable Securities
         by the selling Holders thereof and (z) shall comply as to form in all
         material respects with

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         the requirements of the applicable form and include all financial
         statements required by the SEC to be filed therewith, and use
         commercially reasonable efforts to cause such Registration Statement to
         become effective and remain effective in accordance with Section 2
         hereof;

                  (b) prepare and file with the SEC such amendments and
         post-effective amendments to each Registration Statement as may be
         necessary to keep such Registration Statement effective for the period
         specified herein and cause each Prospectus to be supplemented by any
         required prospectus supplement and, as so supplemented, to be filed
         pursuant to Rule 424 under the 1933 Act; to keep each Prospectus
         current during the period described under Section 4(3) and Rule 174
         under the 1933 Act that is applicable to transactions by brokers or
         dealers with respect to the Registrable Securities or Exchange
         Securities;

                  (c) in the case of a Shelf Registration, furnish to each
         Holder of Registrable Securities, to counsel for the Initial
         Purchasers, to counsel for the Holders and to each Underwriter of an
         Underwritten Offering of Registrable Securities, if any, without
         charge, as many copies of each Prospectus, including each preliminary
         Prospectus, and any amendment or supplement thereto and such other
         documents as such Holder or Underwriter may reasonably request, in
         order to facilitate the public sale or other disposition of the
         Registrable Securities; and, subject to Section 3(i), the Company
         consents to the use of such Prospectus and any amendment or supplement
         thereto in accordance with applicable law by each of the selling
         Holders of Registrable Securities and any such Underwriters in
         connection with the offering and sale of the Registrable Securities
         covered by, and in the manner described in, such Prospectus or any
         amendment or supplement thereto in accordance with applicable law;

                  (d) use commercially reasonable efforts to register or qualify
         the Registrable Securities under all applicable state securities or
         "blue sky" laws of such jurisdictions as any Holder of Registrable
         Securities covered by a Registration Statement shall reasonably request
         in writing by the time the applicable Registration Statement is
         declared effective by the SEC, to cooperate with such Holders in
         connection with any filings required to be made with the National
         Association of Securities Dealers, Inc. and do any and all other acts
         and things which may be reasonably necessary or advisable to enable
         such Holder to consummate the disposition in each such jurisdiction of
         such Registrable Securities owned by such Holder; provided, however,
         that the Company shall not be required to (i) qualify as a foreign
         corporation or as a dealer in securities in any jurisdiction where it
         would not otherwise be required to qualify but for this Section 3(d),
         (ii) file any general consent to service of process or (iii) subject
         itself to taxation in any such jurisdiction if it is not so subject;

                  (e) in the case of a Shelf Registration, notify each Holder of
         Registrable Securities, counsel for the Holders and counsel for the
         Initial Purchasers promptly and, if requested by any such Holder or
         counsel, confirm such advice in writing (i) when a Registration
         Statement has become effective and when any post-effective amendment
         thereto has been filed and becomes effective, (ii) of any request by
         the SEC or any state securities authority for amendments and
         supplements to a Registration Statement and

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         Prospectus or for additional information after the Registration
         Statement has become effective, (iii) of the issuance by the SEC or any
         state securities authority of any stop order suspending the
         effectiveness of a Registration Statement or the initiation of any
         proceedings for that purpose, (iv) if, between the effective date of a
         Registration Statement and the closing of any sale of Registrable
         Securities covered thereby, the representations and warranties of the
         Company contained in any underwriting agreement, securities sales
         agreement or other similar agreement, if any, relating to the offering
         cease to be true and correct in all material respects or if the Company
         receives any notification with respect to the suspension of the
         qualification of the Registrable Securities for sale in any
         jurisdiction or the initiation of any proceeding for such purpose, (v)
         of the happening of any event during the period a Shelf Registration
         Statement is effective which makes any statement made in such Shelf
         Registration Statement or the related Prospectus untrue in any material
         respect or which requires the making of any changes in such Shelf
         Registration Statement or Prospectus in order to make the statements
         therein not misleading and (vi) of any determination by the Company
         that a post-effective amendment to a Registration Statement would be
         appropriate;

                  (f) make every commercially reasonable effort to obtain the
         withdrawal of any order suspending the effectiveness of a Registration
         Statement at the earliest possible moment and provide immediate notice
         to each Holder of the withdrawal of any such order;

                  (g) in the case of a Shelf Registration, furnish to each
         Holder of Registrable Securities, without charge, at least one
         conformed copy of each Registration Statement and any post-effective
         amendment thereto (without documents incorporated therein by reference
         or exhibits thereto, unless requested);

                  (h) in the case of a Shelf Registration, cooperate with the
         selling Holders of Registrable Securities to facilitate the timely
         preparation and delivery of certificates representing Registrable
         Securities to be sold and not bearing any restrictive legends and
         enable such Registrable Securities to be in such denominations
         (consistent with the provisions of the Indenture) and registered in
         such names as the selling Holders may reasonably request at least two
         business days prior to the closing of any sale of Registrable
         Securities;

                  (i) in the case of a Shelf Registration, upon the occurrence
         of any event contemplated by Section 3(e)(v) hereof, use commercially
         reasonable efforts to prepare and file with the SEC a supplement or
         post-effective amendment to a Registration Statement or the related
         Prospectus or any document incorporated therein by reference or file
         any other required document so that, as thereafter delivered to the
         purchasers of the Registrable Securities, such Prospectus will not
         contain any untrue statement of a material fact or omit to state a
         material fact necessary to make the statements therein, in light of the
         circumstances under which they were made, not misleading. The Company
         agrees to notify the Holders to suspend use of the Prospectus as
         promptly as practicable after the occurrence of such an event, and the
         Holders hereby agree to suspend use of the Prospectus until the Company
         has amended or supplemented the Prospectus to correct such misstatement
         or omission and have furnished copies of the amended or

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         supplemented Prospectus to the Holders or until the Company notifies
         the Holders that the sale of the Registrable Securities may be resumed;

                  (j) a reasonable time prior to the filing of any Registration
         Statement, any Prospectus, any amendment to a Registration Statement or
         amendment or supplement to a Prospectus, provide copies of such
         document to the Initial Purchasers and their counsel (and, in the case
         of a Shelf Registration Statement, the Holders and their counsel) and
         make such of the representatives of the Company as shall be reasonably
         requested by the Initial Purchasers or their counsel (and, in the case
         of a Shelf Registration Statement, the Holders or their counsel)
         available for discussion of such document, and shall not at any time
         file or make any amendment to the Shelf Registration Statement, any
         Prospectus or any amendment of or supplement to a Shelf Registration
         Statement or a Prospectus, of which the Initial Purchasers and their
         counsel (and, in the case of a Shelf Registration Statement, the
         Holders and their counsel) shall not have previously been advised and
         furnished a copy or to which the Initial Purchasers or their counsel
         (and, in the case of a Shelf Registration Statement, the Holders or
         their counsel) shall reasonably object;

                  (k) obtain a CUSIP number for all Exchange Securities or
         Registrable Securities, as the case may be, not later than the
         effective date of the applicable Registration Statement;

                  (l) cause the Indenture to be qualified under the Trust
         Indenture Act of 1939, as amended (the "TIA"), in connection with the
         registration of the Exchange Securities or Registrable Securities, as
         the case may be, cooperate with the Trustee and the Holders to effect
         such changes to the Indenture as may be required for the Indenture to
         be so qualified in accordance with the terms of the TIA and execute,
         and use commercially reasonable best efforts to cause the Trustee to
         execute, all documents as may be required to effect such changes and
         all other forms and documents required to be filed with the SEC to
         enable the Indenture to be so qualified in a timely manner;

                  (m) in the case of a Shelf Registration, make available for
         inspection by a representative of the Holders of the Registrable
         Securities, any Underwriter participating in any disposition pursuant
         to such Shelf Registration Statement, and attorneys and accountants
         designated by the Holders, at reasonable times and in a reasonable
         manner, all financial and other records, pertinent documents and
         properties of the Company, and cause the respective officers, directors
         and employees of the Company to supply all information reasonably
         requested by any such representative, Underwriter, attorney or
         accountant in connection with a Shelf Registration Statement;

                  (n) use commercially reasonable efforts to cause the Exchange
         Securities to continue to be rated by two nationally recognized
         statistical rating organizations (as such term is defined in Rule
         436(g)(2) under the 1933 Act), if the Registrable Securities have been
         rated;

                  (o) if reasonably requested by any Holder of Registrable
         Securities covered by a Registration Statement, (i) promptly
         incorporate in a Prospectus supplement or post-effective amendment such
         information with respect to such Holder as such Holder

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         reasonably requests to be included therein and (ii) make all required
         filings of such Prospectus supplement or such post-effective amendment
         as soon as the Company has received notification of the matters to be
         incorporated in such filing; and

                  (p) in the case of a Shelf Registration, enter into such
         customary agreements and take all such other actions in connection
         therewith (including those reasonably requested by the Holders of a
         majority of the Registrable Securities being sold thereunder) in order
         to expedite or facilitate the disposition of such Registrable
         Securities thereunder including, but not limited to, pursuant to an
         Underwritten Offering and in such connection, (i) to the extent
         possible, make such representations and warranties to the Holders and
         any Underwriters of such Registrable Securities with respect to the
         business of the Company and its subsidiaries, the Registration
         Statement, Prospectus and documents incorporated by reference or deemed
         incorporated by reference, if any, in each case, in form, substance and
         scope as are customarily made by issuers to underwriters in
         underwritten offerings and confirm the same if and when requested, (ii)
         obtain opinions of counsel to the Company (which counsel and opinions,
         in form, scope and substance, shall be reasonably satisfactory to the
         Holders of a majority in principal amount of the Registrable Securities
         being sold under such Shelf Registration Statement, such Underwriters
         and their respective counsel) addressed to each selling Holder and
         Underwriter of Registrable Securities, covering the matters customarily
         covered in opinions requested in underwritten offerings, (iii) obtain
         "cold comfort" letters from the independent certified public
         accountants of the Company (and, if necessary, any other certified
         public accountant of any subsidiary of the Company, or of any business
         acquired by the Company for which financial statements and financial
         data are or are required to be included in the Registration Statement)
         addressed to each selling Holder and Underwriter of Registrable
         Securities, such letters to be in customary form and covering matters
         of the type customarily covered in "cold comfort" letters in connection
         with underwritten offerings, and (iv) deliver such documents and
         certificates as may be reasonably requested by the Holders of a
         majority in principal amount of the Registrable Securities being sold
         under such Shelf Registration Statement or the Underwriters, and which
         are customarily delivered in underwritten offerings, to evidence the
         continued validity of the representations and warranties of the Company
         made pursuant to clause (i) above and to evidence compliance with any
         customary conditions contained in an underwriting agreement.

                  In the case of a Shelf Registration Statement, the Company may
require each Holder of Registrable Securities to furnish to the Company such
information regarding the Holder and the proposed distribution by such Holder of
such Registrable Securities as the Company may from time to time reasonably
request in writing. No Holder of Registrable Securities may include its
Registrable Securities in such Shelf Registration Statement unless and until
such Holder furnishes such information to the Company. Each Holder including
Registrable Securities in a Shelf Registration Statement shall agree to furnish
promptly to the Company all information regarding such Holder and the proposed
distribution by such Holder of such Registrable Securities required to make the
information previously furnished to the Company by such Holder not materially
misleading.

                                       11
<PAGE>   13

                  In connection with an Exchange Offer Registration, each Holder
exchanging Securities for Exchange Securities shall be required to represent
that (i) the Exchange Securities are being obtained in the ordinary course of
business of the Person receiving such Exchange Securities, whether or not such
Person is a Holder, (ii) neither such Holder nor any such other Person has an
arrangement or understanding with any Person to participate in the distribution
of Exchange Securities, (iii) other than as set forth in Section 4, if the
Holder is not a broker-dealer, or is a broker-dealer but will not receive
Exchange Securities for its own account in exchange for Securities, neither the
Holder nor any such other Person is engaged in or intends to participate in a
distribution of the Exchange Securities and (iv) neither the Holder nor any such
other Person is an "affiliate" of the Company within the meaning of Rule 405
under the Securities Act or, if such Person is an "affiliate", that such Holder
will comply with the registration and prospectus delivery requirements of the
Securities Act to the extent applicable.

                  In the case of a Shelf Registration Statement, each Holder
agrees that, upon receipt of any notice from the Company of the happening of any
event of the kind described in Section 3(e)(v) hereof, such Holder will
forthwith discontinue disposition of Registrable Securities pursuant to a
Registration Statement until such Holder's receipt of the copies of the
supplemented or amended Prospectus contemplated by Section 3(i) hereof, and, if
so directed by the Company, such Holder will deliver to the Company (at its
expense) all copies in its possession, other than permanent file copies then in
such Holder's possession, of the Prospectus covering such Registrable Securities
current at the time of receipt of such notice. If the Company shall give any
such notice to suspend the disposition of Registrable Securities pursuant to a
Registration Statement, the Company shall extend the period during which the
Registration Statement shall be maintained effective pursuant to this Agreement
by the number of days during the period from and including the date of the
giving of such notice to and including the date when the Holders shall have
received copies of the supplemented or amended Prospectus necessary to resume
such dispositions. The Company may give such notice so long as there are no more
than 90 days during any 365 day period in which such suspensions are in effect.

                  The Holders of Registrable Securities covered by a Shelf
Registration Statement who desire to do so may sell such Registrable Securities
in an Underwritten Offering. In any such Underwritten Offering, the investment
banker or investment bankers and manager or managers (the "Underwriters") that
will administer the offering will be selected by the Majority Holders of the
Registrable Securities included in such offering; provided that such
Underwriters shall be reasonably acceptable to the Company.

                  4. Participation of Broker-Dealers in Exchange Offer.

                  (a) The parties hereto understand that the Staff of the SEC
has taken the position that any broker-dealer that receives Exchange Securities
for its own account in the Exchange Offer in exchange for Securities that were
acquired by such broker-dealer as a result of market-making or other trading
activities (a "Participating Broker-Dealer"), may be deemed to be an
"underwriter" within the meaning of the 1933 Act and must deliver a prospectus
meeting the requirements of the 1933 Act in connection with any resale of such
Exchange Securities.

                  The Company understands that it is currently the Staff's
position that if the Prospectus contained in the Exchange Offer Registration
Statement includes a plan of

12
<PAGE>   14

distribution containing a statement to the above effect and the means by which
Participating Broker-Dealers may resell the Exchange Securities, without naming
the Participating Broker-Dealers or specifying the amount of Exchange Securities
owned by them, such Prospectus may be delivered by Participating Broker-Dealers
to satisfy their prospectus delivery obligation under the 1933 Act in connection
with resales of Exchange Securities for their own accounts, so long as the
Prospectus otherwise meets the requirements of the 1933 Act.

                  (b) In light of the above, notwithstanding the other
provisions of this Agreement, the Company agrees that the provisions of this
Agreement as they relate to a Shelf Registration shall also apply to an Exchange
Offer Registration to the extent, and with such reasonable modifications thereto
as may be, reasonably requested by the Initial Purchasers or by one or more
Participating Broker-Dealers, in each case as provided in clause (ii) below, in
order to expedite or facilitate the disposition of any Exchange Securities by
Participating Broker-Dealers consistent with the positions of the Staff recited
in Section 4(a) above; provided that:

                  (i) the Company shall not be required to amend or supplement
         the Prospectus contained in the Exchange Offer Registration Statement,
         as would otherwise be contemplated by Section 3(i), for a period
         exceeding 180 days after the last Exchange Date (as such period may be
         extended pursuant to the penultimate paragraph of Section 3 of this
         Agreement) and Participating Broker-Dealers shall not be authorized by
         the Company to deliver and shall not deliver such Prospectus after such
         period in connection with the resales contemplated by this Section 4;
         and

                  (ii) the application of the Shelf Registration procedures set
         forth in Section 3 of this Agreement to an Exchange Offer Registration,
         to the extent not required by the positions of the Staff of the SEC or
         the 1933 Act and the rules and regulations thereunder, will be in
         conformity with the reasonable request in writing to the Company by the
         Initial Purchasers or with the reasonable request in writing to the
         Company by one or more broker-dealers who certify to the Initial
         Purchasers and the Company in writing that they anticipate that they
         will be Participating Broker-Dealers; and provided further that, in
         connection with such application of the Shelf Registration procedures
         set forth in Section 3 to an Exchange Offer Registration, the Company
         shall be obligated (x) to deal only with one entity representing the
         Participating Broker-Dealers, which shall be UBS Warburg LLC unless it
         elects not to act as such representative, (y) to pay the fees and
         expenses of only one counsel representing the Participating
         Broker-Dealers, which shall be counsel to the Initial Purchasers unless
         such counsel elects not to so act and (z) to cause to be delivered only
         one, if any, "cold comfort" letter with respect to the Prospectus in
         the form existing on the last Exchange Date and with respect to each
         subsequent amendment or supplement, if any, effected during the period
         specified in clause (i) above.

                  (c) The Initial Purchasers shall have no liability to the
Company, other than as Holders in accordance with the terms hereof, or to any
other Holder with respect to any request that they may make pursuant to Section
4(b) above.

13
<PAGE>   15

                  5. Indemnification and Contribution.

                  (a) The Company agrees to indemnify and hold harmless the
Initial Purchasers, each Holder and each Person, if any, who controls the
Initial Purchasers or any Holder within the meaning of either Section 15 of the
1933 Act or Section 20 of the 1934 Act, or is under common control with, or is
controlled by, the Initial Purchasers or any Holder (each, a "Participant"),
from and against all losses, claims, damages and liabilities (including, without
limitation, any legal or other expenses reasonably incurred by a Participant in
connection with defending or investigating any such action or claim) caused by
any untrue statement or alleged untrue statement of a material fact contained in
any Registration Statement (or any amendment thereto) pursuant to which Exchange
Securities or Registrable Securities were registered under the 1933 Act,
including all documents incorporated therein by reference, or caused by any
omission or alleged omission to state therein a material fact required to be
stated therein or necessary to make the statements therein not misleading, or
caused by any untrue statement or alleged untrue statement of a material fact
contained in any Prospectus (as amended or supplemented if the Company shall
have furnished any amendments or supplements thereto) forming a part of such
Registration Statement, or caused by any omission or alleged omission to state
therein a material fact necessary to make the statements therein in light of the
circumstances under which they were made not misleading, except insofar as such
losses, claims, damages or liabilities are caused by any such untrue statement
or omission or alleged untrue statement or omission based upon information
relating to the Initial Purchasers or any Holder furnished to the Company in
writing by the Initial Purchasers or any selling Holder expressly for use
therein; provided that the foregoing indemnity with respect to any Prospectus
shall not inure to the benefit of any Holder from whom the Person asserting any
such losses, claims, damages or liabilities purchased Securities, or any Person
controlling such Holder, if a copy of the final Prospectus (as then amended or
supplemented if the Company shall have furnished any amendments or supplements
thereto) was not sent by, or delivered on behalf of, such Holder to such Person
at or prior to the written confirmation of the sale of the Securities to such
Person, if the final Prospectus (as so amended or supplemented) would have cured
the defect giving rise to such loss, claim, damage or liability. In connection
with any Underwritten Offering permitted by Section 3, the Company will also
enter into an underwriting agreement pursuant to which the Company will agree to
indemnify the Underwriters, if any, selling brokers, dealers and similar
securities industry professionals participating in such Underwritten Offering,
their officers and directors and each Person who controls such Persons (within
the meaning of the 1933 Act and the 1934 Act) to substantially the same extent
as provided above with respect to the indemnification of the Holders, if
requested in connection with any Registration Statement for such Underwritten
Offering.

                  (b) Each Holder agrees, severally and not jointly, to
indemnify and hold harmless the Company, the Initial Purchasers and the other
selling Holders, and each of their respective directors, officers who sign the
Registration Statement and each Person, if any, who controls the Company, the
Initial Purchasers and any other selling Holder within the meaning of either
Section 15 of the 1933 Act or Section 20 of the 1934 Act to the same extent as
the foregoing indemnity from the Company to the Initial Purchasers and the
Holders pursuant to Section 5(a), but only with reference to information
relating to such Holder furnished to the Company in writing by such Holder
expressly for use in any Registration Statement (or any amendment thereto) or
any Prospectus (or any amendment or supplement thereto).

14
<PAGE>   16

                  (c) In case any proceeding (including any governmental
investigation) shall be instituted involving any Person in respect of which
indemnity may be sought pursuant to either paragraph (a) or paragraph (b) above,
such Person (the "indemnified party") shall promptly notify the Person against
whom such indemnity may be sought (the "indemnifying party") in writing, but the
failure to so promptly notify the indemnifying party shall not negate the
obligation to so indemnify such indemnified party unless the indemnifying party
is materially prejudiced by such delay, and the indemnifying party, upon request
of the indemnified party, shall retain counsel reasonably satisfactory to the
indemnified party to represent the indemnified party and any others the
indemnifying party may designate in such proceeding and shall pay the fees and
disbursements of such counsel related to such proceeding. In any such
proceeding, any indemnified party shall have the right to retain its own
counsel, but the fees and expenses of such counsel shall be at the expense of
such indemnified party unless (i) the indemnifying party and the indemnified
party shall have mutually agreed to the retention of such counsel or (ii) the
named parties to any such proceeding (including any impleaded parties) include
both the indemnifying party and the indemnified party and, in the opinion of
counsel to the indemnifying party, representation of both parties by the same
counsel would be inappropriate due to actual or potential differing interests
between them. It is understood that the indemnifying party shall not, in
connection with any proceeding or related proceedings in the same jurisdiction,
be liable for (a) the fees and expenses of more than one separate firm (in
addition to any local counsel) for the Initial Purchasers and all Persons, if
any, who control the Initial Purchasers within the meaning of either Section 15
of the 1933 Act or Section 20 of the 1934 Act, (b) the fees and expenses of more
than one separate firm (in addition to any local counsel) for the Company, its
directors, its officers who sign the Registration Statement and each Person, if
any, who controls the Company within the meaning of either such Section and (c)
the fees and expenses of more than one separate firm (in addition to any local
counsel) for all Holders and all Persons, if any, who control any Holders within
the meaning of either such Section, and that all such fees and expenses shall be
reimbursed as they are incurred. In such case involving the Initial Purchasers
and Persons who control the Initial Purchasers, such firm shall be designated in
writing by the Initial Purchasers. In such case involving the Holders and such
Persons who control Holders, such firm shall be designated in writing by the
Majority Holders. In all other cases, such firm shall be designated by the
Company. The indemnifying party shall not be liable for any settlement of any
proceeding effected without its written consent but, if settled with such
consent or if there be a final judgment for the plaintiff, the indemnifying
party agrees to indemnify the indemnified party from and against any loss or
liability by reason of such settlement or judgment. No indemnifying party shall,
without the prior written consent of the indemnified party, effect any
settlement of any pending or threatened proceeding in respect of which such
indemnified party is or could have been a party and indemnity could have been
sought hereunder by such indemnified party, unless such settlement includes an
unconditional release of such indemnified party from all liability on claims
that are the subject matter of such proceeding.

                  (d) If the indemnification provided for in paragraph (a) or
paragraph (b) of this Section 5 is unavailable to an indemnified party or
insufficient in respect of any losses, claims, damages or liabilities, then each
indemnifying party under such paragraph, in lieu of indemnifying such
indemnified party thereunder, shall contribute to the amount paid or payable by
such indemnified party as a result of such losses, claims, damages or
liabilities in such proportion as is appropriate to reflect the relative fault
of the indemnifying party or parties on the one hand and of the indemnified
party or parties on the other hand in connection with the

15
<PAGE>   17

statements or omissions that resulted in such losses, claims, damages or
liabilities, as well as any other relevant equitable considerations. The
relative fault of the Company and the Holders shall be determined by reference
to, among other things, whether the untrue or alleged untrue statement of a
material fact or the omission or alleged omission to state a material fact
relates to information supplied by the Company or by the Holders and the
parties' relative intent, knowledge, access to information and opportunity to
correct or prevent such statement or omission. The Holders' respective
obligations to contribute pursuant to this Section 5(d) are several in
proportion to the respective principal amount of Registrable Securities of the
applicable Holder that were registered pursuant to a Registration Statement.

                  (e) The Company and each Holder agree that it would not be
just or equitable if contribution pursuant to this Section 5(d) were determined
by pro rata allocation or by any other method of allocation that does not take
account of the equitable considerations referred to in Section 5(d) above. The
amount paid or payable by an indemnified party as a result of the losses,
claims, damages and liabilities referred to in Section 5(d) above shall be
deemed to include, subject to the limitations set forth above, any legal or
other expenses reasonably incurred by such indemnified party in connection with
investigating or defending any such action or claim. Notwithstanding the
provisions of this Section 5, no Holder shall be required to indemnify or
contribute any amount in excess of the amount by which the total price at which
Registrable Securities were sold by such Holder exceeds the amount of any
damages that such Holder has otherwise been required to pay by reason of such
untrue or alleged untrue statement or omission or alleged omission. No Person
guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of
the 1933 Act) shall be entitled to contribution from any Person who was not
guilty of such fraudulent misrepresentation. The remedies provided for in this
Section 5 are not exclusive and shall not limit any rights or remedies which may
otherwise be available to any indemnified party at law or in equity.

                  The indemnity and contribution provisions contained in this
Section 5 shall remain operative and in full force and effect regardless of (i)
any termination of this Agreement, (ii) any investigation made by or on behalf
of the Initial Purchasers, any Holder or any Person controlling the Initial
Purchasers or any Holder, or by or on behalf of the Company, its officers or
directors or any Person controlling the Company, (iii) acceptance of any of the
Exchange Securities and (iv) any sale of Registrable Securities pursuant to a
Shelf Registration Statement.

                  6. Miscellaneous.

                  (a) No Inconsistent Agreements. The Company has not entered
into, and on or after the date of this Agreement will not enter into, any
agreement which is inconsistent with the rights granted to the Holders of
Registrable Securities in this Agreement or otherwise conflicts with the
provisions hereof. The rights granted to the Holders hereunder do not in any way
conflict with and are not inconsistent with the rights granted to the holders of
the Company's other issued and outstanding securities under any such agreements.

                  (b) Amendments and Waivers. The provisions of this Agreement,
including the provisions of this sentence, may not be amended, modified or
supplemented, and waivers or consents to departures from the provisions hereof
may not be given unless the Company has obtained the written consent of Holders
of at least a majority in aggregate principal amount of

16
<PAGE>   18

the outstanding Registrable Securities affected by such amendment, modification,
supplement, waiver or consent; provided, however, that no amendment,
modification, supplement, waiver or consent to any departure from the provisions
of Section 5 hereof or this paragraph (b) shall be effective as against any
Holder of Registrable Securities unless consented to in writing by such Holder.

                  (c) Notices. All notices and other communications provided for
or permitted hereunder shall be made in writing by hand-delivery, registered
first-class mail, telecopier, or any courier guaranteeing overnight delivery (i)
if to a Holder, at the most current address given by such Holder to the Company
by means of a notice given in accordance with the provisions of this Section
6(c), which address initially is, with respect to the Initial Purchasers, the
address set forth in the Purchase Agreement; and (ii) if to the Company,
initially at the Company's address set forth in the Purchase Agreement and
thereafter at such other address, notice of which is given in accordance with
the provisions of this Section 6(c).

                  All such notices and communications shall be deemed to have
been duly given: at the time delivered by hand, if personally delivered; five
business days after being deposited in the mail, postage prepaid, if mailed;
when receipt is acknowledged, if telecopied; and on the next business day if
timely delivered to an air courier guaranteeing overnight delivery.

                  Copies of all such notices, demands, or other communications
shall be concurrently delivered by the Person giving the same to the Trustee, at
the address specified in the Indenture.

                  (d) Successors and Assigns. This Agreement shall inure to the
benefit of, and be binding upon, the successors, assigns and transferees of each
of the parties, including, without limitation and without the need for an
express assignment, subsequent Holders of Registrable Securities; provided that
nothing herein shall be deemed to permit any assignment, transfer or other
disposition of Registrable Securities in violation of the terms of the
Securities. If any transferee of any Holder shall acquire Registrable
Securities, in any manner, whether by operation of law or otherwise, such
Registrable Securities shall be held subject to all of the terms of this
Agreement, and by taking and holding such Registrable Securities such Person
shall be conclusively deemed to have agreed to be bound by and to perform all of
the terms and provisions of this Agreement and such Person shall be entitled to
receive the benefits hereof. The Initial Purchasers shall have no liability or
obligation to the Company with respect to any failure by any other Holder to
comply with, or any breach by any other Holder of, any of the obligations of
such Holder under this Agreement.

                  (e) Purchases and Sales of Securities. The Company shall not,
and shall use its commercially reasonable efforts to cause its affiliates (as
defined in Rule 405 under the 1933 Act) not to, purchase and then resell or
otherwise transfer any Securities.

                  (f) Third Party Beneficiary. The Holders shall be third party
beneficiaries to the agreements made hereunder between the Company, on the one
hand, and the Initial Purchasers, on the other hand, shall be bound by all of
the terms and provisions of this Agreement and shall have the right to enforce
such agreements directly to the extent it deems such enforcement necessary or
advisable to protect its rights or the rights of Holders hereunder.

                                       17
<PAGE>   19

                  (g) Counterparts. This Agreement may be executed in any number
of counterparts and by the parties hereto in separate counterparts, each of
which when so executed shall be deemed to be an original and all of which taken
together shall constitute one and the same agreement.

                  (h) Headings. The headings in this Agreement are for
convenience of reference only and shall not limit or otherwise affect the
meaning hereof.

                  (i) Governing Law. This Agreement shall be governed by the
laws of the State of New York.

                  (j) Severability. In the event that any one or more of the
provisions contained herein, or the application thereof in any circumstance, is
held invalid, illegal or unenforceable, the validity, legality and
enforceability of any such provision in every other respect and of the remaining
provisions contained herein shall not be affected or impaired thereby.

18
<PAGE>   20

                  IN WITNESS WHEREOF, the parties have executed this Agreement
as of the date first written above.

                                        THE WILLIAMS COMPANIES, INC.

                                        By: /s/ DEBORAH S. FLEMING
                                           ------------------------------------

                                                  Name:  Deborah S. Fleming
                                                  Title: Assistant Treasurer

Confirmed and accepted as of
the date first above written:

UBS Warburg LLC
Credit Suisse First Boston Corporation
Lehman Brothers Inc.
ABN AMRO Incorporated
Banc of America Securities LLC
BMO Nesbitt Burns Corp.
Commerzbank Securities
Credit Lyonnais Securities
The Royal Bank of Scotland PLC
Scotia Capital Markets
TD Securities

By: UBS Warburg LLC
Acting on behalf of itself and the several Initial Purchasers

By: /s/ SCOTT K. GIESE
   -----------------------------

Name:  Scott K. Giese
     ---------------------------
Title: Executive Director
      --------------------------
      Global F1 Derivatives

By: /s/ GARY KAUFMAN
   -----------------------------

Name:  Gary Kaufman
     ---------------------------
Title: Executive Director
      --------------------------
      Global Rates Derivatives

19<PAGE>   1
                                                                    EXHIBIT 10.1

                          THE WILLIAMS COMPANIES, INC.

               $700,000,000 7.50% Debentures due January 15, 2031
                $400,000,000 6.75% Putable Asset Term Securities
                        Putable/Callable January 15, 2006

                               PURCHASE AGREEMENT

                                                                January 11, 2001

UBS Warburg LLC
Credit Suisse First Boston Corporation
Lehman Brothers Inc.
ABN AMRO Incorporated
Banc of America Securities LLC
BMO Nesbitt Burns Corp.
Commerzbank Securities
Credit Lyonnais Securities (USA) Inc.
The Royal Bank of Scotland plc
Scotia Capital Markets
TD Securities
c/o UBS Warburg LLC
677 Washington Boulevard
Stamford, CT 06901

Ladies and Gentlemen:

         The Williams Companies, Inc., a corporation duly organized and existing
under the laws of the State of Delaware (the "Company"), UBS AG, acting through
its London Branch (the "Selling Securityholder") and UBS Warburg LLC, Credit
Suisse First Boston Corporation, Lehman Brothers Inc., ABN AMRO Incorporated,
Banc of America Securities LLC, BMO Nesbitt Burns Corp., Commerzbank Securities,
Credit Lyonnais Securities (USA) Inc., The Royal Bank of Scotland plc, Scotia
Capital Markets and TD Securities (the "Initial Purchasers") confirm their
agreement as follows: (1) the Company will sell to the Initial Purchasers
$200,000,000 aggregate principal amount of its 7.50% Debentures due January 15,
2031 (the "7.50% Debentures") and $400,000,000 aggregate principal amount of its
6.75% Putable Asset Term Securities Putable/Callable January 15, 2006 (the
"PATS" and, together with the 7.50% Debentures, the "Securities") and (2) the
Selling Securityholder will sell to the Initial Purchasers $500,000,000
aggregate principal amount of the 7.50% Debentures. The Securities will be

<PAGE>   2

entitled to the benefits of a registration rights agreement dated the date
hereof between the Company and the Initial Purchasers (the "Registration Rights
Agreement").

         The Securities will be offered and sold to the Initial Purchasers,
without registration under the Securities Act of 1933, as amended (the
"Securities Act"), in reliance upon an exemption from the registration
requirements of the Securities Act. In connection with the sale of the
Securities, the Company has prepared an offering memorandum dated January 11,
2001 (the "Offering Memorandum") setting forth certain information concerning
the Company, the Selling Securityholder and the Securities. All references in
this Agreement to the Offering Memorandum include the documents incorporated by
reference therein. The Company hereby confirms that it has authorized the use of
the Offering Memorandum in connection with the offer and sale of the Securities.

         The Company understands that the Initial Purchasers propose to make
offerings ("Exempt Resales") of the Securities only on the terms and in the
manner set forth in the Offering Memorandum and Section 3 hereof, as soon as the
Initial Purchasers deem advisable after this Agreement has been executed and
delivered only to (i) persons in the United States whom the Initial Purchasers
reasonably believe to be "qualified institutional buyers" ("QIBs") as defined in
Rule 144A under the Act, as such rule may be amended from time to time ("Rule
144A"), or, if any such person is buying for one or more institutional accounts
for which such person is acting as fiduciary or agent, only when such person has
represented to the Initial Purchasers that each such account is a QIB, to whom
notice has been given that such sale or delivery is being made in reliance on
Rule 144A, and, in each case, in transactions under Rule 144A and (ii) non-U.S.
persons to whom offers and sales of the Securities may be made in reliance upon
Regulation S under the Act ("Regulation S"), in transactions meeting the
requirements of Regulation S.

         When used herein, the term "Indenture" shall refer to the indenture
dated as of November 10, 1997, between the Company and Bank One Trust Company,
N.A., as Trustee (the "Indenture Trustee") as amended by the First Supplemental
Indenture dated as of September 8, 2000, the Second Supplemental Indenture dated
as of December 7, 2000, the Third Supplemental Indenture dated as of December
20, 2000, the Fourth Supplemental Indenture dated as of January 17, 2001 and the
Fifth Supplemental Indenture dated as of January 17, 2001.

         1. The Company represents and warrants to, and agrees with, the Initial
Purchasers that as of the date hereof and at the Time of Delivery (as defined
herein):

                  (a) The Company has been duly incorporated, is validly
         existing as a corporation in good standing under the laws of the State
         of Delaware and is duly qualified to do business and is in good
         standing in each jurisdiction in which the conduct of its business or
         its ownership or leasing of property requires such qualification,
         except to the extent that the failure to be so qualified or be in good
         standing would not have a material adverse effect on the financial
         condition, results of operations or business of the Company and its
         subsidiaries, taken as a whole (a "Material Adverse Effect");

                                       2
<PAGE>   3

                  (b) Each of the significant subsidiaries (as defined in Rule
         1-02(w) of Regulation S-X promulgated by the Securities and Exchange
         Commission) of the Company (the "Significant Subsidiaries") has been
         duly organized or validly formed, is validly existing and in good
         standing under the laws of the jurisdiction of its formation or
         incorporation and is duly qualified to do business and is in good
         standing in each jurisdiction in which the conduct of its business or
         its ownership or leasing of property requires such qualification,
         except to the extent that the failure to be so qualified or be in good
         standing would not have a Material Adverse Effect;

                  (c) Each of the Company and its Significant Subsidiaries has
         all consents, authorizations, approvals, orders, certificates and
         permits of and from, and has made all declarations and filings with,
         all federal, state, local and other governmental authorities, and all
         courts or other tribunals (collectively the "Licenses") necessary to
         own or lease, as the case may be, and to operate its properties and to
         carry on its business as presently conducted, except where the failure
         to possess such Licenses could not reasonably be expected to have a
         Material Adverse Effect, and neither the Company nor any of its
         Significant Subsidiaries has received any notice of proceedings
         relating to revocation or modification of any such Licenses;

                  (d) Each of the Company and its Significant Subsidiaries (i)
         is in compliance with any and all applicable foreign, federal, state
         and local laws and regulations relating to the protection of human
         health and safety, the environment or hazardous or toxic substances or
         wastes, pollutants or contaminants ("Environmental Laws"), (ii) has
         received all permits, licenses or other approvals required of it under
         applicable Environmental Laws to conduct its business and (iii) is in
         compliance with all terms and conditions of any such permit, license or
         approval, except where such noncompliance with Environmental Laws,
         failure to receive required permits, licenses or other approvals or
         failure to comply with the terms and conditions of such permits,
         licenses or approvals would not, singly or in the aggregate, have a
         Material Adverse Effect;

                  (e) In the ordinary course of its business, each of the
         Company and its Significant Subsidiaries conducts a periodic review of
         the effect of Environmental Laws on its business, operations and
         properties, in the course of which it identifies and evaluates
         associated costs and liabilities (including, without limitation, any
         capital or operating expenditures required for clean-up, closure of
         properties or compliance with Environmental Laws or any permit, license
         or approval, any related constraints on operating activities and any
         potential liabilities to third parties). On the basis of such review,
         each of the Company and its Significant Subsidiaries reasonably
         concluded that such associated costs and liabilities would not, singly
         or in the aggregate, have a Material Adverse Effect;

                  (f) The Company has filed all material tax returns which are
         required to be filed by it and has paid all taxes due pursuant to such
         returns or pursuant to any assessment received by the Company, except
         where the same may be contested in good faith by

                                       3
<PAGE>   4

         appropriate proceedings, and where the Company has maintained in
         accordance with generally accepted accounting principles appropriate
         reserves for the accrual of any of the same. The charges, accruals and
         reserves on the books of the Company in respect of taxes or other
         governmental charges are, in the opinion of the Company, adequate;

                  (g) The Company is not an "investment company" or an entity
         "controlled" by an "investment company" as such terms are defined in
         the Investment Company Act of 1940, as amended;

                  (h) This Agreement has been duly authorized, executed and
         delivered by the Company;

                  (i) The Indenture has been duly authorized, executed and
         delivered by the Company and, assuming due authorization, execution and
         authentification by the Trustee, is a valid and binding obligation of
         the Company, enforceable against the Company in accordance with its
         terms, except as enforcement thereof may be limited by bankruptcy,
         insolvency (including, without limitation, all laws relating to
         fraudulent transfers), reorganization, moratorium or similar laws
         affecting enforcement of creditors' rights generally and except as
         enforcement thereof is subject to general principles of equity
         (regardless of whether considered in a proceeding in equity or at law).
         The Indenture has been duly qualified under the Trust Indenture Act of
         1939;

                  (j) The Securities have been duly authorized by the Company
         and, when executed and authenticated in accordance with the provisions
         of the Indenture and delivered to and paid for by the Initial
         Purchasers in accordance with the terms of this Agreement, will be
         entitled to the benefits of the Indenture and will be valid and binding
         obligations of the Company, enforceable in accordance with their terms
         except as (i) the enforceability thereof may be limited by bankruptcy,
         insolvency (including, without limitation, all laws relating to
         fraudulent transfers), reorganization, moratorium or similar laws
         affecting creditors' rights generally and (ii) rights of acceleration,
         if any, enforceability and the availability of equitable remedies may
         be limited by equitable principles of general applicability (regardless
         of whether considered in a proceeding in equity or at law);

                  (k) The Securities constitute unsecured and unsubordinated
         obligations of the Company and rank pari passu without any preference
         among themselves; the Securities rank pari passu with all other
         unsecured and unsubordinated debt obligations of the Company other than
         any unsubordinated debt obligations which rank junior to the
         Securities;

                  (l) The Company Purchase Option (as defined in section 7(j) of
         this Agreement) has been duly authorized, and when duly executed and
         delivered by the Company and the Selling Securityholder, will
         constitute valid and binding obligations of the Company, enforceable
         against the Company in accordance with their terms, except as
         enforcement

                                       4
<PAGE>   5

         thereof may be limited by bankruptcy, insolvency (including, without
         limitation, all laws relating to fraudulent transfers), reorganization,
         moratorium or similar laws affecting enforcement of creditors' rights
         generally and except as enforcement thereof is subject to general
         principles of equity (regardless of whether considered in a proceeding
         in equity or at law);

                  (m) The Registration Rights Agreement has been duly
         authorized, and when duly executed and delivered by the Company and the
         Initial Purchasers, will constitute valid and binding obligations of
         the Company, enforceable against the Company in accordance with their
         terms, except as enforcement thereof may be limited by bankruptcy,
         insolvency (including, without limitation, all laws relating to
         fraudulent transfers), reorganization, moratorium or similar laws
         affecting enforcement of creditors' rights generally and except as
         enforcement thereof is subject to general principles of equity
         (regardless of whether considered in a proceeding in equity or at law);

                  (n) The execution and delivery by the Company of this
         Agreement, the Indenture, the issuance and delivery of the Securities,
         the Company Purchase Option, the Registration Rights Agreement, the
         consummation by the Company of the transactions contemplated herein and
         the compliance by the Company with the terms of this Agreement, the
         Indenture, the Securities and the Registration Rights Agreement have
         been duly authorized by all necessary corporate action on the part of
         the Company and do not and will not result in any violation of the
         charter or by-laws of the Company, and do not and will not conflict
         with, or result in a breach of any of the terms or provisions of, or
         constitute a default under, any indenture, mortgage, deed of trust,
         loan agreement or other agreement or instrument to which the Company is
         a party or by which the Company is bound (except for such conflicts,
         breaches or defaults that could not reasonably be expected to have a
         Material Adverse Effect), nor does or will such action result in any
         violation of any statute or any order, rule or regulation of any court
         or governmental agency or body having jurisdiction over the Company or
         any of its properties; and no consent, approval, authorization, order,
         registration or qualification of or with any such court or governmental
         agency or body is required for the issuance and sale of the Securities
         or the consummation by the Company of the transactions contemplated by
         the Registration Rights Agreement, the Company Purchase Option, this
         Agreement or the Indenture;

                  (o) Neither the Company nor any of its Significant
         Subsidiaries is in violation of its charter or by-laws or in default in
         the performance or observance of any material obligation, agreement,
         covenant or condition contained in any contracts, indenture, mortgage,
         deed of trust, loan agreement, lease or other agreement or instrument
         to which it is a party;

                  (p) The Company has filed all documents with the Securities
         and Exchange Commission (the "Commission") that it is required to file
         under the Securities Act and the Securities Exchange Act of 1934, as
         amended (the "Exchange Act"), as applicable, and the rules and
         regulations of the Commission thereunder, and such documents conformed
         in all material respects to the requirements of the Securities Act or
         the Exchange Act, as applicable,

                                       5
<PAGE>   6

         and the rules and regulations of the Commission thereunder, and at the
         time so filed none of such documents contained an untrue statement of a
         material fact or omitted to state a material fact required to be stated
         therein or necessary to make the statements therein not misleading; and
         any further documents so filed and incorporated by reference in the
         documents filed with the Commission or any further amendment or
         supplement thereto, when such documents become effective or are filed
         with the Commission, as the case may be, will conform in all material
         respects to the requirements of the Securities Act or the Exchange Act,
         as applicable, and the rules and regulations of the Commission
         thereunder and will not contain an untrue statement of a material fact
         or omit to state a material fact required to be stated therein or
         necessary to make the statements therein not misleading;

                  (q) The Offering Memorandum does not as of the time hereof and
         will not, as of the Time of Delivery, contain an untrue statement of a
         material fact or omit to state a material fact necessary in order to
         make the statements therein, in the light of the circumstances under
         which they were made, not misleading; provided, however, that this
         representation and warranty shall not be made to the Initial Purchasers
         with regard to any statements or omissions made in reliance upon and in
         conformity with information furnished in writing to the Company by, or
         on behalf of, the Selling Securityholder or the Initial Purchasers, as
         the case may be;

                  (r) Neither the Company nor any of its Significant
         Subsidiaries has sustained, since the date of the latest audited
         financial statements included or incorporated by reference in the
         Offering Memorandum, any loss or interference with its business from
         fire, explosion, flood or other calamity, whether or not covered by
         insurance, or from any labor dispute or court or governmental action,
         order or decree, which would result in any material adverse change, or
         any development involving a prospective material adverse change, in or
         affecting the general affairs, management, financial position,
         stockholders' equity or results of operations of the Company and its
         subsidiaries, taken as a whole, otherwise than as set forth or
         contemplated in the Offering Memorandum, and, since the respective
         dates as of which information is given in the Offering Memorandum,
         there has not been any change in the capital stock (other than pursuant
         to the Company's common stock repurchase program, or its dividend
         reinvestment and other common stock plans) or long-term debt of the
         Company or any of its Significant Subsidiaries, or any material adverse
         change, or any development involving a prospective material adverse
         change, in or affecting the general affairs, management, financial
         position, stockholder's equity or results of operations of the Company
         and its Significant Subsidiaries, taken as a whole, otherwise than as
         disclosed in the Offering Memorandum;

                  (s) The consolidated financial statements filed with or as
         part of any document filed with the Commission present fairly in all
         material respects the financial position, results of operations and
         changes in financial position of the Company and its

                                       6
<PAGE>   7

         subsidiaries at the dates and for the periods indicated, all in
         conformity with generally accepted accounting principles; and the
         Company has no material contingent obligation which is not disclosed in
         such financial statements;

                  (t) Other than as set forth or incorporated by reference in
         the Offering Memorandum, there is no action, suit or proceeding before
         or by any government, governmental instrumentality or court, domestic
         or foreign, now pending or, to the knowledge of the Company, threatened
         against or affecting the Company that could reasonably be expected to
         result in any Material Adverse Effect, or that could reasonably be
         expected to adversely affect the consummation of the transactions
         contemplated in this Agreement;

                  (u) Assuming the accuracy of the representations, warranties
         and agreements of the Initial Purchasers in Section 4 hereof and the
         Selling Securityholder in Section 2 hereof, compliance by the Initial
         Purchasers and the Selling Securityholder with the offering and
         transfer procedures and restrictions described in the Offering
         Memorandum, the accuracy of the representations and warranties deemed
         to be made in the Offering Memorandum by purchasers to whom the Initial
         Purchasers initially resell the Securities and that purchasers to whom
         the Initial Purchasers initially resell the Securities receive a copy
         of the Offering Memorandum prior to such sale, it is not necessary in
         connection with the offer, sale and delivery of the Securities to the
         Initial Purchasers or in connection with the initial resale of the
         Securities by the Initial Purchasers in the manner contemplated by this
         Agreement and the Offering Memorandum to register the Securities under
         the Securities Act or to qualify the Indenture under the Trust
         Indenture Act of 1939, as amended;

                  (v) The Company, its affiliates and any person acting on its
         or their behalf have not, directly or indirectly:

                           (i) engaged in any directed selling efforts (within
                  the meaning of Regulation S under the Securities Act) with
                  respect to the Securities;

                          (ii) offered or sold the Securities in the United
                  States by any form of general solicitation or general
                  advertising (within the meaning of Regulation D under the
                  Securities Act) or in any manner involving a public offering
                  within the meaning of Section 4(2) of the Securities Act; or

                         (iii) sold, solicited any offers to buy or offered to
                  sell or otherwise negotiated in respect of any security in a
                  manner that would require registration of the Securities under
                  the Securities Act in accordance with the theory of
                  "integration" referred to in Regulation D under the Securities
                  Act.

                  (w) The Securities satisfy the requirements of Rule 144A(d)(3)
         under the Securities Act.

                                       7
<PAGE>   8

                  (x) On the date hereof, the Offering Memorandum contains the
         information regarding the Company specified in, and which satisfies the
         requirements of, Rule 144A(d)(4) under the Securities Act.

                  (y) Ernst & Young LLP, who have audited certain consolidated
         financial statements of the Company, are independent public accountants
         as required by the Securities Act and the rules and regulations of the
         Commission thereunder.

         2. The Selling Securityholder represents and warrants to, and agrees
with, each of the Initial Purchasers that:

                  (a) This Agreement has been duly authorized, executed and
         delivered by or on behalf of the Selling Securityholder;

                  (b) The execution and delivery by the Selling Securityholder
         of, and the performance by the Selling Securityholder of its
         obligations under this Agreement, and the consummation of the
         transactions herein contemplated, will not conflict with or result in a
         breach or violation of any of the terms or provisions of, or constitute
         a default under, any indenture, mortgage, deed of trust, loan agreement
         or other agreement or instrument to which the Selling Securityholder is
         a party or by which the Selling Securityholder is bound, nor will such
         action result in any violation of the provisions of the Organization
         Regulations of the Selling Securityholder or any statute or any order,
         rule or regulation of any court or governmental agency or body having
         jurisdiction over the Selling Securityholder or any of its properties;
         and no consent, approval, authorization, order, registration or
         qualification of or with any such court or governmental agency or body
         is required on behalf of the Selling Securityholder for the
         consummation by the Selling Securityholder of the transactions
         contemplated by this Agreement except such approvals as have been, or
         will have been, prior to the Time of Delivery, obtained under the Act
         and the Trust Indenture Act and such consents, approvals,
         authorizations, orders, registrations or qualifications as may be
         required under state securities or Blue Sky laws in connection with the
         purchase and distribution of the Securities by the Initial Purchasers;

                  (c) At the Time of Delivery, the Selling Securityholder will
         have valid and unencumbered title to the 7.50% Debentures sold by it
         pursuant to this Agreement and full right, power and authority to sell,
         assign, transfer and deliver such 7.50% Debentures; and upon the
         delivery and payment for such Securities at the Time of Delivery, the
         Initial Purchasers will acquire valid and unencumbered title to such
         7.50% Debentures;

                  (d) The Information relating to the Selling Securityholder
         furnished in writing by or on behalf of the Selling Securityholder
         expressly for use in the Offering Memorandum does not contain any
         untrue statement of a material fact required to be stated therein or
         necessary to make the statements therein not misleading.

                                       8
<PAGE>   9

         3. On the basis of the representations, warranties and covenants
contained in this Agreement, and subject to the terms and conditions herein set
forth, (a) the Company agrees to sell to the several Initial Purchasers, and
each Initial Purchaser agrees, severally and not jointly, to purchase from the
Company, the respective aggregate principal amount of 7.50% Debentures and PATS
set forth in columns A and B, respectively, of Schedule A hereto opposite to its
name at a purchase price equal to 99.07% and 99.625% of the aggregate principal
amount of such Securities, respectively; (b) the Selling Securityholder agrees
to sell to the several Initial Purchasers, and each Initial Purchaser agrees,
severally and not jointly, to purchase from the Selling Securityholder, the
respective aggregate principal amount of 7.50% Debentures set forth in column A
of Schedule B hereto opposite to its name at a purchase price equal to 99.07% of
the aggregate principal amount of such 7.50% Debentures; (c) the Company agrees
to pay to the Initial Purchasers a placement fee of 0.875% of $200,000,000
aggregate principal amount of the 7.50% Debentures and 0.60% of $400,000,000
aggregate principal amount of the PATS and the Selling Securityholder agrees to
pay to the Initial Purchasers a placement fee of 0.875% of $500,000,000
aggregate principal amount of the 7.50% Debentures, as compensation for placing
the Securities (the "Placement Fee"); (d) the Company agrees to assign to the
Selling Securityholder the option to purchase the PATS from the holders of such
securities provided for in the Fourth Supplemental Indenture (the "Call
Option"); and (e) the Selling Securityholder agrees to pay $20,043,330 to the
Company for the assignment of the Call Option.

         4. Each Initial Purchaser, severally and not jointly, hereby represents
and warrants to, and agrees with the Company that: such Initial Purchaser (i) is
a QIB with such knowledge and experience in financial and business matters as
are necessary in order to evaluate the merits and risks of an investment in the
Securities; (ii) is not acquiring the Securities with a view to any distribution
thereof that would violate the Securities Act or the securities or blue sky laws
of any state or country, (iii) has received all information it considers
necessary to evaluate the merits and risks of an investment in the Securities,
(iv) will not engage in any directed selling efforts (within the meaning of
Regulation S under the Securities Act) with respect to the Securities and has
complied with the offering restriction requirements of Regulation S; (v) will
not offer or sell the Securities in the United States by any form of general
solicitation or general advertising (within the meaning of Regulation D under
the Securities Act) or in any manner involving a public offering within the
meaning of Section 4(2) if the Securities Act; and (vi) will offer or sell the
Securities only: (x) in offshore transactions in accordance with Rule 903 of
Regulation S under the Securities Act; provided that commencing on the date
hereof and continuing through a 40-day restricted period commencing at the Time
of Delivery: (1) no such offer or sale will be made to a U.S. person or for the
account or benefit of a U.S. person (other than such Initial Purchaser); and (2)
such Initial Purchaser, if selling Securities to a dealer or a person receiving
a selling concession, fee or other remuneration in respect of the Securities,
will send a confirmation or other notice to the purchaser stating that the
purchaser is subject to the same restrictions on offers and sales as are set
forth in this section 4; the terms used in this clause (x) are being used as
used in Regulation S under the Securities Act; or (y) to persons whom it
reasonably believes to be QIBs within the meaning of Rule 144A under the
Securities Act in compliance with Rule 144A.

                                       9
<PAGE>   10

         5. The Securities to be delivered to the Initial Purchasers hereunder
will be represented by one or more global certificates in book-entry form which
will be deposited by, or on behalf of, the Company with, and shall be registered
in the name of, The Depository Trust Company ("DTC") or its designated
custodian. Such Securities shall bear the legend set forth in the Offering
Memorandum. The Company and the Selling Securityholder will deliver the
Securities respectively sold by them to the Initial Purchasers at the Time of
Delivery at the offices of Shearman & Sterling, New York, New York, against
payment of the purchase price in Federal (same day) funds to the account
specified by the Company and the Selling Securityholder to the Initial
Purchasers. The Company will cause the certificates representing the Securities
to be made available to the Initial Purchasers for checking at least twenty four
hours prior to the Time of Delivery at the offices of Shearman & Sterling. The
time and date of such delivery and of the payment referred to in subsection (c)
of section 3 above shall be 9:30.a.m., New York City time on January 17, 2001 or
such other date and time as the Company, the Selling Securityholder and the
Initial Purchasers may agree upon in writing. Such date and time are herein
called the "Time of Delivery."

         6. In further consideration of the agreements of the Initial Purchasers
herein contained, the Company, its affiliates and any person acting on its or
their behalf, covenant with the Initial Purchasers and the Selling
Securityholder as follows:

                  (a) The Company, its affiliates and any person acting on its
         or their behalf will not, directly or indirectly:

                           (i) engage in any directed selling efforts (within
                  the meaning of Regulation S under the Securities Act) with
                  respect to the Securities;

                           (ii) offer or sell the Securities in the United
                  States by any form of general solicitation or general
                  advertising (within the meaning of Regulation D under the
                  Securities Act) or in any manner involving a public offering
                  within the meaning of Section 4(2) of the Securities Act; or

                           (iii) sell, solicit any offers to buy or offer to
                  sell or otherwise negotiate in respect of any security in a
                  manner that would require registration of the Securities under
                  the Securities Act in accordance with the theory of
                  "integration" referred to in Regulation D under the Securities
                  Act.

                  (b) The Company will maintain offering restrictions (within
         the meaning of Regulation S under the Securities Act) in connection
         with the offering of the Securities contemplated in this Agreement and
         the Offering Memorandum commencing on the date hereof and continuing
         through a 40-day restricted period commencing on the Time of Delivery.

                  (c) While any Security remains outstanding, during any period
         in which the Company is not subject to Section 13 or Section 15(d) of
         the Securities Exchange Act of

                                       10
<PAGE>   11

         1934, as amended, and its securities are not exempt from Section 12(g)
         thereof pursuant to Rule 12g3-2(b) thereunder, the Company will upon
         request make available to the Initial Purchasers, to any holder of
         Securities, and to any prospective purchaser designated by any holder
         of Securities, the information regarding the Company specified in, and
         satisfying the requirements of, Rule 144A(d)(4) under the Securities
         Act.

                  (d) The Company will prepare the Offering Memorandum in a form
         approved by the Initial Purchasers, and before amending or
         supplementing the Offering Memorandum, will furnish to the Initial
         Purchasers a copy of each such proposed amendment or supplement and
         will not prepare any such proposed amendment or supplement to which the
         Initial Purchasers reasonably objects.

                  (e) Prior to 10:00 a.m., New York City time, on the New York
         Business Day (as defined below) next succeeding the date of this
         Agreement and from time to time, the Company will furnish the Initial
         Purchasers, in New York City, with copies of the Offering Memorandum in
         New York City and each amendment or supplement thereto, together with
         any independent accountants' report contained in the Offering
         Memorandum, and any amendment or supplement containing amendments to
         the financial statements covered by such report, signed by the
         accountants, and additional copies thereof in such quantities as the
         Initial Purchasers from time to time reasonably request, and if, at any
         time prior to the consummation of any Exempt Resale, any event shall
         have occurred as a result of which the Offering Memorandum as then
         amended or supplemented would include an untrue statement of a material
         fact or omit to state any material fact necessary in order to make the
         statements therein, in the light of the circumstances under which they
         were made when such Offering Memorandum is delivered, not misleading,
         or, if for any other reason it shall be necessary or desirable, during
         such same period to amend or supplement the Offering Memorandum, the
         Company will notify the Initial Purchasers and upon the Initial
         Purchasers' request to prepare and furnish without charge to the
         Initial Purchasers and to any dealer in securities as many copies as
         the Initial Purchasers may from time to time reasonably request of the
         amended Offering Memorandum or supplement to the Offering Memorandum
         which will correct such statement or omission or effect such
         compliance. For the purposes of this paragraph, "New York Business Day"
         shall mean any day that is not a day on which banking institutions in
         New York are generally authorized or required by law or regulation to
         close;

                  (f) During the period beginning on the date hereof and
         continuing to and including the Time of Delivery, the Company will not
         offer, sell, contract to sell or otherwise dispose of any debt
         securities of the Company or warrants to purchase debt securities of
         the Company substantially similar to the Securities (other than the
         Securities), without the prior written consent of the Initial
         Purchasers.

                  (g) The Company will pay all expenses incident to the
         performance of its obligations under this Agreement, including: (i) the
         preparation the Offering

                                       11
<PAGE>   12

         Memorandum and all amendments and supplements thereto; (ii) the
         preparation, issuance and delivery of the Securities; (iii) the fees
         and disbursements of the Company's counsel and accountants and of the
         Trustee and its counsel; (iv) the fees and disbursements of the Initial
         Purchasers' counsel; (iv) the qualification of the Securities under
         state securities or blue sky laws in accordance with the provisions of
         Section 6(f), including filing fees and the fees and disbursements of
         counsel for the Initial Purchasers in connection therewith and in
         connection with the preparation of any blue sky or Legal Investment
         Memoranda; (vi) the printing and delivery to the Initial Purchasers in
         quantities as herein above stated of copies of the Offering Memorandum
         and any amendments or supplements thereto; (vii) the printing and
         delivery to the Initial Purchasers of copies of any blue sky or Legal
         Investment Memoranda; (viii) any fees charged by rating agencies for
         the rating of the Securities; (ix) any expenses incurred by the Company
         in connection with a "road show" presentation to potential investors.

                  (h) To take all reasonable action necessary to enable Standard
         & Poor's Rating Service, a division of McGraw Hill, Inc. ("S&P"), and
         Moody's Investor Service, Inc. ("Moody's") to provide their respective
         ratings of the Securities.

                  (i) To cooperate with the Initial Purchasers and use its
         reasonable best efforts to permit the Securities to be eligible for
         clearance and settlement through the facilities of the Depository Trust
         Company.

         7. The obligations of the Initial Purchasers shall be subject, in the
discretion of the Initial Purchasers, to the condition that all representations
and warranties and other statements of the Company in or incorporated by
reference in the Offering Memorandum as amended or supplemented are, at and as
of the Time of Delivery, true and correct, the condition that the Company shall
have performed all of its obligations hereunder theretofore to be performed, and
the following additional conditions:

                  (a) William G. von Glahn, Esq., Senior Vice President and
         General Counsel of the Company, shall have furnished to such Initial
         Purchasers an opinion, dated the Time of Delivery, in form and
         substance reasonably satisfactory to the Initial Purchasers, to the
         effect that:

                           (i) The Company has been duly incorporated, is
                  validly existing as a corporation in good standing under the
                  laws of the State of Delaware and is duly qualified to do
                  business and is in good standing in each jurisdiction in which
                  the conduct of its business or its ownership or leasing of
                  property requires such qualification, except to the extent
                  that the failure to be so qualified or be in good standing
                  would not have a Material Adverse Effect;

                           (ii) Each of the Significant Subsidiaries has been
                  duly organized or validly formed, is validly existing and in
                  good standing under the laws of the jurisdiction of its
                  incorporation and is duly qualified to do business and is in
                  good

                                       12
<PAGE>   13

                  standing in each jurisdiction in which the conduct of its
                  business or its ownership or leasing of property requires such
                  qualification, except to the extent that the failure to be so
                  qualified or be in good standing would not have a Material
                  Adverse Effect;

                           (iii) Each of the Company and the Significant
                  Subsidiaries has all Licenses necessary to own or lease, as
                  the case may be, and to operate its properties and to carry on
                  its business as presently conducted, except where the failure
                  to possess such Licenses could not reasonably be expected to
                  have a Material Adverse Effect, and neither the Company nor
                  any of its Significant Subsidiaries has received any notice of
                  proceedings relating to revocation or modification of any such
                  Licenses;

                           (iv) This Agreement has been duly authorized,
                  executed and delivered by the Company;

                           (v) The Indenture has been duly authorized, executed
                  and delivered by the Company and, assuming due authorization,
                  execution and authentification by the Trustee, is a valid and
                  binding obligation of the Company, enforceable against the
                  Company in accordance with its terms, except as enforcement
                  thereof may be limited by bankruptcy, insolvency (including,
                  without limitation, all laws relating to fraudulent
                  transfers), reorganization, moratorium or similar laws
                  affecting enforcement of creditors' rights generally and
                  except as enforcement thereof is subject to general principles
                  of equity (regardless of whether considered in a proceeding in
                  equity or at law). The Indenture has been duly qualified under
                  the Trust Indenture Act of 1939;

                           (vi) The Securities have been duly authorized by the
                  Company and, when executed and authenticated in accordance
                  with the provisions of the Indenture and delivered to and paid
                  for by the Initial Purchasers in accordance with the terms of
                  this Agreement, will be entitled to the benefits of the
                  Indenture and will be valid and binding obligations of the
                  Company, enforceable in accordance with their terms except as
                  (i) the enforceability thereof may be limited by bankruptcy,
                  insolvency (including, without limitation, all laws relating
                  to fraudulent transfers), reorganization, moratorium or
                  similar laws affecting creditors' rights generally and (ii)
                  rights of acceleration, if any, enforceability and the
                  availability of equitable remedies may be limited by equitable
                  principles of general applicability (regardless of whether
                  considered in a proceeding in equity or at law);

                           (vii) The Registration Rights Agreement has been duly
                  authorized, executed and delivered and, when executed and
                  delivered by the Initial Purchasers, will constitute valid and
                  binding obligations of the Company, enforceable against the
                  Company in accordance with their terms, except as

                                       13
<PAGE>   14

                  enforcement thereof may be limited by bankruptcy, insolvency
                  (including, without limitation, all laws relating to
                  fraudulent transfers), reorganization, moratorium or similar
                  laws affecting enforcement of creditors' rights generally and
                  except as enforcement thereof is subject to general principles
                  of equity (regardless of whether considered in a proceeding in
                  equity or at law);

                           (viii) The Company Purchase Option has been duly
                  authorized, and when duly executed and delivered by the
                  Company and the Selling Securityholder, will constitute valid
                  and binding obligations of the Company, enforceable against
                  the Company in accordance with their terms, except as
                  enforcement thereof may be limited by bankruptcy, insolvency
                  (including, without limitation, all laws relating to
                  fraudulent transfers), reorganization, moratorium or similar
                  laws affecting enforcement of creditors' rights generally and
                  except as enforcement thereof is subject to general principles
                  of equity (regardless of whether considered in a proceeding in
                  equity or at law);

                           (ix) The execution and delivery by the Company of
                  this Agreement, the Indenture, the Registration Rights
                  Agreement, the issuance and delivery of the Securities, the
                  Company Purchase Option, the consummation by the Company of
                  the transactions contemplated herein and the compliance by the
                  Company with the terms of this Agreement, the Indenture, the
                  Registration Rights Agreement, the Company Purchase Option and
                  the Securities have been duly authorized by all necessary
                  corporate action on the part of the Company and do not and
                  will not result in any violation of the charter or by-laws of
                  the Company, and do not and will not conflict with, or result
                  in a breach of any of the terms or provisions of, or
                  constitute a default under, any indenture, mortgage, deed of
                  trust, loan agreement or other agreement or instrument to
                  which the Company is a party or by which the Company is bound
                  (except for such conflicts, breaches or defaults that could
                  not reasonably be expected to have a Material Adverse Effect),
                  nor does or will such action result in any violation of the
                  charter or by-laws of the Company or any statute or any order,
                  rule or regulation of any court or governmental agency or body
                  having jurisdiction over the Company or any of its properties;
                  and no consent, approval, authorization, order, registration
                  or qualification of or with any such court or governmental
                  agency or body is required for the issuance and sale of the
                  Securities or the consummation by the Company of the
                  transactions contemplated by the Registration Rights
                  Agreement, the Company Purchase Option, this Agreement or the
                  Indenture;

                           (x) Neither the Company nor any of its Significant
                  Subsidiaries is in violation of its charter or by-laws or in
                  default in the performance or observance of any material
                  obligation, agreement, covenant or condition contained in any
                  contracts, indenture, mortgage, deed of trust, loan agreement,
                  lease or other agreement or instrument to which it is a party;

                                       14
<PAGE>   15

                           (xi) The Company is not an "investment company," as
                  such term is defined in the Investment Company Act;

                           (xii) The Company has filed all documents with the
                  Commission that it is required to file under the Securities
                  Act and the Exchange Act, as applicable, and the rules and
                  regulations of the Commission thereunder, and such documents
                  (other than the financial statements, including the notes
                  thereto, and related schedules therein, and the other
                  financial and accounting data, as to which such counsel need
                  express no opinion) conformed in all material respects to the
                  requirements of the Securities Act or the Exchange Act, as
                  applicable, and the rules and regulations of the Commission
                  thereunder; and such counsel has no reason to believe that any
                  of such documents, when they became effective and were so
                  filed, as the case may be, contained, in the case of a
                  registration statement which became effective under the
                  Securities Act or Exchange Act, an untrue statement of a
                  material fact or omitted to state a material fact required to
                  be stated therein or necessary to make the statements therein
                  not misleading, or, in the case of other documents which were
                  filed under the Securities Act or the Exchange Act with the
                  Commission, an untrue statement of a material fact or omitted
                  to state a material fact necessary in order to make the
                  statements therein, in the light of the circumstances under
                  which they were made when such documents were so filed, not
                  misleading;

                           (xiii) The statements in the Offering Memorandum
                  under the captions "Description of the Securities," insofar as
                  they purport to constitute a summary of the terms of the
                  Securities and "Plan of Distribution," insofar as they purport
                  to describe the legal matters and documents referred to
                  therein, fairly summarize in all material respects the matters
                  referred to therein;

                           (xiv) After due inquiry, such counsel does not know
                  of any legal or governmental proceedings pending or threatened
                  to which the Company is a party or to which any of the
                  properties of the Company is subject that are required to be
                  described in the Offering Memorandum and are not so described
                  or of any statutes, regulations, contracts or other documents
                  that are required to be described in the Offering Memorandum
                  that are not described as required;

                           (xv) Such counsel has no reason to believe that
                  (except for financial statements and schedules and related
                  notes thereto, and the other financial and accounting data as
                  to which such counsel need not express any belief) the
                  Offering Memorandum contains any untrue statement of a
                  material fact or omits to state a material fact required to be
                  stated therein or necessary to make the statements therein, in
                  the light of the circumstances under which they were made, not
                  misleading; and

                                       15
<PAGE>   16

                           (xvi) Assuming the accuracy of the representations of
                  the Initial Purchasers contained in Section 4 hereof and the
                  Selling Securityholder in Section 2 hereof, compliance by the
                  Initial Purchasers and the Selling Securityholder with the
                  offering and transfer procedures and restrictions described in
                  the Offering Memorandum, the accuracy of the representations
                  and warranties deemed to be made in the Offering Memorandum by
                  purchasers to whom the Initial Purchasers initially resell the
                  Securities and that purchasers to whom the Initial Purchasers
                  initially resell the Securities receive a copy of the Offering
                  Memorandum prior to such sale, it is not necessary in
                  connection with the offer, sale and delivery of the Securities
                  in the manner contemplated in this Agreement to register the
                  Securities under the Securities Act or to qualify the
                  Indenture under the Trust Indenture Act of 1939, as amended.

                  (b) Counsel (which may be in-house counsel) for the Selling
         Securityholder, shall have furnished to the Initial Purchasers an
         opinion, dated the Time of Delivery, in form and substance satisfactory
         to the Initial Purchasers, to the effect that:

                           (i) This Agreement has been duly authorized, executed
                  and delivered by the Selling Securityholder;

                           (ii) The Selling Securityholder had full right, power
                  and authority to sell and deliver the Securities sold by it in
                  accordance with the provisions of this Agreement; and

                           (iii) Upon delivery to DTC or its agent of the
                  Securities sold by the Selling Securityholder registered in
                  the name of Cede & Co., as nominee for DTC, and upon the
                  payment of the purchase price for such Securities and the
                  crediting by DTC of such Securities to the securities accounts
                  of the Initial Purchasers with DTC, the Initial Purchasers
                  will acquire a valid entitlement (within the meaning of
                  Section 8-501 of the New York Uniform Commercial Code) in
                  respect of the Securities to be purchased by it, and no action
                  (whether framed in conversion, replevin, constructive trust,
                  equitable lien, or other theory) based on an adverse claim to
                  such Securities may be asserted against the Initial Purchasers
                  (assuming that the Initial Purchasers are without notice of
                  any adverse claim).

                  (c) The Initial Purchasers shall have received at the Time of
         Delivery an opinion of Shearman & Sterling, counsel for the Initial
         Purchasers, dated the Time of Delivery, covering the matters referred
         to in subparagraphs (iv), (v) and (vi) of subsection (a) above and the
         accuracy and completeness of the statements set forth in the Offering
         Memorandum under the captions "Description of the Securities," insofar
         as they purport to constitute a summary of the terms of the Securities,
         and "Plan of Distribution," insofar as they purport to describe the
         documents referred to therein, as well as such other matters as the
         Initial Purchasers may reasonably request, and such counsel shall have
         received such documents and information as they may reasonably request
         to enable them to pass upon such matters.

                                       16
<PAGE>   17

                  (d) The Initial Purchasers shall have received at the time of
         execution of this Agreement a letter, dated the date hereof, in form
         and substance satisfactory to the Initial Purchasers, from Ernst &
         Young LLP, independent public accountants, containing statements and
         information of the type ordinarily included in accountants' "comfort
         letters" to the Initial Purchasers with respect to the financial
         statements and certain financial information contained in the Offering
         Memorandum.

                  (e) With respect to the letter of Ernst & Young referred to in
         the preceding paragraph and delivered to the Initial Purchasers on the
         date hereof (the "Initial Letter"), the Initial Purchasers shall have
         received at the Time of Delivery a letter (the "Bring Down Letter")
         from Ernst & Young, dated the Time of Delivery (i) stating as of the
         date of such Bring Down Letter the conclusions and findings of such
         firm with respect to the financial information and other matters
         covered by the Initial Letter and (ii) confirming in all material
         respects the conclusions and findings set forth in the Initial Letter.

                  (f) (i) Neither the Company nor any of its Significant
         Subsidiaries shall have sustained, since the date of the latest audited
         financial statements included in or incorporated by reference in the
         Offering Memorandum, any loss or interference with its business from
         fire, explosion, flood or other calamity, whether or not covered by
         insurance, or from any labor dispute or court or governmental action,
         order or decree, which would result in any material adverse change, or
         any development involving a prospective material adverse change, in or
         affecting the general affairs, management, financial position,
         stockholders' equity or results of operations of the Company and its
         subsidiaries, taken as a whole, otherwise than as set forth or
         contemplated in the Offering Memorandum, and (ii) since the respective
         dates as of which information is given in the Offering Memorandum,
         there shall not have been any change in the capital stock (other than
         pursuant to the Company's common stock repurchase program, or its
         dividend reinvestment and other common stock plans) or long-term debt
         of the Company or any of its Significant Subsidiaries or any material
         adverse change, or any development involving a prospective material
         adverse change, in or affecting the general affairs, management,
         financial position, stockholders' equity or results of operations of
         the Company and its Significant Subsidiaries, taken as a whole,
         otherwise than as set forth in the Offering Memorandum, as of the date
         of this Agreement, the effect of which, in any such case described in
         clause (i) or (ii), is in the judgment of the Initial Purchasers so
         material and adverse as to make it impracticable or inadvisable to
         proceed with the sale or the delivery of the Securities on the terms
         and in the manner contemplated in the Offering Memorandum;

                  (g) During the period beginning on the date hereof and ending
         at the Time of Delivery, (i) no downgrading shall have occurred in the
         rating accorded the debt securities or preferred stock of the Company
         by any "nationally recognized statistical rating organization," as that
         term is defined by the Commission for purposes of Rule 436(g)(2) under
         the Securities Act, and (ii) no such organization shall have publicly

                                       17
<PAGE>   18

         announced that it has under surveillance or review, with possible
         negative implications, its rating of any of the debt securities or
         preferred stock of the Company;

                  (h) During the period beginning on the date hereof and ending
         at the Time of Delivery, there shall not have occurred any of the
         following: (i) a suspension or material limitation in trading in
         securities generally on the New York Stock Exchange or the
         establishment of minimum prices on such exchange; (ii) a suspension or
         material limitation in trading in the Company's securities on the New
         York Stock Exchange; (iii) a general moratorium on commercial banking
         activities declared by either Federal or New York State authorities;
         (iv) a material disruption of the United States government securities
         market, United States corporate bond market or the United States
         federal wire transfer system; and (v) an outbreak or escalation of
         hostilities involving the United States or the declaration of a
         national emergency or war by the United States, if the effect of any
         such event specified in this clause (h) in the judgment of the Initial
         Purchasers makes it impracticable or inadvisable to proceed with the
         sale or the delivery of the Securities; and

                  (i) The Company shall furnish, or cause to be furnished to the
         Initial Purchasers, at the Time of Delivery, a certificate or
         certificates of officers of the Company satisfactory to the Initial
         Purchasers (i) as to the accuracy of the representations and warranties
         of the Company herein at and as of such Time of Delivery, (ii) as to
         the performance by the Company of all of its obligations hereunder to
         be performed at or prior to such Time of Delivery, (iii) as to the
         matters set forth in clauses (i) and (ii) of subsection (f) of this
         Section and (iv) as to such other matters as the Initial Purchasers may
         reasonably request.

                  (j) The Company and the Initial Purchaser shall have entered
         into a letter agreement satisfactory to the Initial Purchaser,
         substantially in the form of Exhibit A hereto (the "Company Purchase
         Option").

                  8. (a) The Company agrees to indemnify and hold harmless the
         Selling Securityholder and each Initial Purchaser against any losses,
         claims, damages or liabilities, joint or several, to which such
         Securityholder or Initial Purchaser, as the case may be, may become
         subject, under the Act or otherwise, insofar as such losses, claims,
         damages or liabilities (or actions in respect thereof) arise out of or
         are based upon an untrue statement or alleged untrue statement of a
         material fact contained in the Offering Memorandum, or any amendment or
         supplement thereto, or arise out of or are based upon the omission or
         alleged omission to state therein a material fact required to be stated
         therein or necessary to make the statements therein not misleading, and
         will reimburse such Selling Securityholder or Initial Purchaser, as the
         case may be, for any legal or other expenses reasonably incurred by
         such Selling Securityholder or Initial Purchaser in connection with
         investigating or defending any such action or claim as such expenses
         are incurred; provided, however, that the Company shall not be liable
         in any such case to the extent that any such loss, claim, damage or
         liability arises out of or is based upon an untrue statement or alleged
         untrue statement or omission or alleged omission made in the

                                       18
<PAGE>   19

         Offering Memorandum, or any such amendment or supplement thereto, in
         reliance upon and in conformity with written information relating to
         the Selling Securityholder or any Initial Purchaser furnished to the
         Company by the Selling Securityholder or such Initial Purchasers, as
         the case may be, expressly for use in the Offering Memorandum as
         amended or supplemented.

                  (b) The Selling Securityholder agrees to indemnify and hold
         harmless the Company and each Initial Purchaser against any losses,
         claims, damages or liabilities, joint or several, to which such Company
         or Initial Purchaser may become subject, under the Act or otherwise,
         insofar as such losses, claims, damages or liabilities (or actions in
         respect thereof) arise out of or are based upon an untrue statement or
         alleged untrue statement of a material fact contained in the Offering
         Memorandum, or any amendment or supplement thereto, or arise out of or
         are based upon the omission or alleged omission to state therein a
         material fact required to be stated therein or necessary to make the
         statements therein not misleading, in each case to the extent, but only
         to the extent, that such untrue statement or alleged untrue statement
         or omission or alleged omission was made in the Offering Memorandum, or
         any amendment or supplement thereto in reliance upon and in conformity
         with written information relating to the Selling Securityholder
         furnished to the Company by the Selling Securityholder expressly for
         use therein; and will reimburse the Company and each Initial Purchaser
         for any legal or other expenses reasonably incurred by the Company or
         such Initial Purchaser in connection with investigating or defending
         any such action or claim as such expenses are incurred;

                  (c) Each Initial Purchaser agrees to indemnify and hold
         harmless the Company and the Selling Securityholder against any losses,
         claims, damages or liabilities to which the Company or the Selling
         Securityholder may become subject, under the Act or otherwise, insofar
         as such losses, claims, damages or liabilities (or actions in respect
         thereof) arise out of or are based upon an untrue statement or alleged
         untrue statement of a material fact contained in the Offering
         Memorandum, or any amendment or supplement thereto, or arise out of or
         are based upon the omission or alleged omission to state therein a
         material fact required to be stated therein or necessary to make the
         statements therein not misleading, in each case to the extent, but only
         to the extent, that such untrue statement or alleged untrue statement
         or omission or alleged omission was made in the Offering Memorandum, or
         any amendment or supplement thereto in reliance upon and in conformity
         with written information relating to such Initial Purchaser furnished
         to the Company by such Initial Purchaser expressly for use therein; and
         will reimburse the Company and the Selling Securityholder for any legal
         or other expenses reasonably incurred by the Company or the Selling
         Securityholder in connection with investigating or defending any such
         action or claim as such expenses are incurred.

                  (d) Promptly after receipt by an indemnified party under
         subsection (a), (b) or (c) above of notice of the commencement of any
         action, such indemnified party shall, if a claim in respect thereof is
         to be made against the indemnifying party under such subsection, notify
         the indemnifying party in writing of the commencement thereof; but the
         omission so to notify the indemnifying party shall not relieve it from
         any liability which it may have to any indemnified party otherwise than
         under such subsection. In

                                       19
<PAGE>   20

         case any such action shall be brought against any indemnified party and
         it shall notify the indemnifying party of the commencement thereof, the
         indemnifying party shall be entitled to participate therein and, to the
         extent that it shall wish, jointly with any other indemnifying party
         similarly notified, to assume the defense thereof, with counsel
         satisfactory to such indemnified party (who shall not, except with the
         consent of the indemnified party, be counsel to the indemnifying
         party), and, after notice from the indemnifying party to such
         indemnified party of its election so to assume the defense thereof, the
         indemnifying party shall not be liable to such indemnified party under
         such subsection for any legal expenses of other counsel or any other
         expenses, in each case subsequently incurred by such indemnified party,
         in connection with the defense thereof other than reasonable costs of
         investigation. No indemnifying party shall, without the written consent
         of the indemnified party, effect the settlement or compromise of, or
         consent to the entry of any judgment with respect to, any pending or
         threatened action or claim in respect of which indemnification or
         contribution may be sought hereunder (whether or not the indemnified
         party is an actual or potential party to such action or claim) unless
         such settlement, compromise or judgment (i) includes an unconditional
         release of the indemnified party from all liability arising out of such
         action or claim and (ii) does not include a statement as to or an
         admission of fault, culpability or a failure to act, by or on behalf of
         any indemnified party.

                  (e) If the indemnification provided for in this Section 8 is
         unavailable to or insufficient to hold harmless an indemnified party
         under subsection (a), (b) or (c) above in respect of any losses,
         claims, damages or liabilities (or actions in respect thereof) referred
         to therein, then each indemnifying party shall contribute to the amount
         paid or payable by such indemnified party as a result of such losses,
         claims, damages or liabilities (or actions in respect thereof) in such
         proportion as is appropriate to reflect the relative benefits received
         by the Selling Securityholder and the Company on the one hand and the
         Initial Purchasers on the other to which such loss, claim, damage or
         liability (or action in respect thereof) relates. If, however, the
         allocation provided by the immediately preceding sentence is not
         permitted by applicable law or if the indemnified party failed to give
         the notice required under subsection (d) above, then each indemnifying
         party shall contribute to such amount paid or payable by such
         indemnified party in such proportion as is appropriate to reflect not
         only such relative benefits but also the relative fault of the Selling
         Securityholder and the Company on the one hand and the Initial
         Purchasers of the Securities on the other in connection with the
         statements or omissions which resulted in such losses, claims, damages
         or liabilities (or actions in respect thereof), as well as any other
         relevant equitable considerations. The relative benefits received by
         the Selling Securityholder and the Company on the one hand and the
         Initial Purchasers on the other shall be deemed to be in the same
         proportion as the total net proceeds from such offering (before
         deducting expenses) received by the Company and the Selling
         Securityholder bear to the total commissions received by the Initial
         Purchasers. The relative benefits received by the Company on the one
         hand and the Selling Securityholder on the other shall be deemed to be
         in the same proportion as the total net proceeds from such offering
         (before deducting expenses) received by the Company and the Selling
         Securityholder bear to the total commissions received by the Initial
         Purchasers. The relative fault shall be

                                       20
<PAGE>   21

         determined by reference to, among other things, whether the untrue or
         alleged untrue statement of a material fact or the omission or alleged
         omission to state a material fact relates to information supplied by
         the Selling Securityholder and the Company on the one hand or such
         Initial Purchasers on the other and the parties' relative intent,
         knowledge, access to information and opportunity to correct or prevent
         such statement or omission. The Company, the Selling Securityholder and
         the Initial Purchasers agree that it would not be just and equitable if
         contribution pursuant to this subsection (e) were determined by pro
         rata allocation or by any other method of allocation which does not
         take account of the equitable considerations referred to above in this
         subsection (e). The amount paid or payable by an indemnified party as a
         result of the losses, claims, damages or liabilities (or actions in
         respect thereof) referred to above in this subsection (e) shall be
         deemed to include any legal or other expenses reasonably incurred by
         such indemnified party in connection with investigating or defending
         any such action or claim. Notwithstanding the provisions of this
         subsection (e), no Initial Purchaser shall be required to contribute
         any amount in excess of the amount by which the total price at which
         the Securities sold by it exceeds the amount of any damages which such
         Initial Purchaser has otherwise been required to pay by reason of such
         an untrue or alleged untrue statement or omission. No person guilty of
         fraudulent misrepresentation (within the meaning of Section 11(f) of
         the Act) shall be entitled to contribution from any person who was not
         guilty of such fraudulent misrepresentation.

                  (f) The obligations of the Selling Securityholder or the
         Company under this Section 8 shall be in addition to any liability
         which the Selling Securityholder or the Company, as the case may be,
         may otherwise have and shall extend, upon the same terms and
         conditions, to each person, if any, who controls any Initial Purchasers
         within the meaning of the Act; and the obligations of the Initial
         Purchasers under this Section 8 shall be in addition to any liability
         which the respective Initial Purchasers may otherwise have and shall
         extend, upon the same terms and conditions, to each officer and
         director of the Selling Securityholder or the Company, as the case may
         be, and to each person, if any, who controls the Selling Securityholder
         or the Company, as the case may be, within the meaning of the Act.

         9. The respective agreements, representations, warranties and other
statements of the Company, the Selling Securityholder and the Initial Purchasers
as set forth in this Agreement or made by or on behalf of them, respectively,
pursuant to this Agreement, shall remain in full force and effect, regardless of
any investigation (or any statement as to the results thereof) made by or on
behalf of any Initial Purchaser or any controlling person of such Initial
Purchaser or the Company, or any officer or director or controlling person of
the Company, and shall survive delivery of and payment for the Securities.

         10. All statements, requests, notices and agreements hereunder shall be
in writing, and if to the Selling Securityholder shall be delivered or sent by
mail, telex or facsimile transmission to UBS AG, London Branch, c/o UBS Warburg
LLC, 677 Washington Boulevard, Stamford, CT 06901, Attn: William Sullivan,
facsimile number: 203-719-7319; if to the Initial Purchasers by mail, telex or
facsimile transmission to UBS Warburg LLC, 677 Washington Boulevard,

                                       21
<PAGE>   22

Stamford, CT 06901, Attn: Scott Giese, facsimile number: 203-719-7319; and if to
the Company shall be delivered or sent by mail, telex or facsimile transmission
to The Williams Companies, Inc., One Williams Center, Tulsa, Oklahoma 74172,
Attn: Treasurer, facsimile number: 918-573-2065. Any such statements, requests,
notices or agreements shall take effect upon receipt thereof.

         11. This Agreement shall be binding upon, and inure solely to the
benefit of, the Initial Purchasers, the Selling Securityholder and the Company,
and their respective heirs, executors, administrators, successors and assigns,
and no other person shall acquire or have any right under or by virtue of this
Agreement. No purchaser of any of the Securities from the Initial Purchasers
shall be deemed a successor or assign by reason merely of such purchase.

         12. If the Company fails or refuses to comply with the terms or to
fulfill any of the conditions of this Agreement other than by reason of default
by the Initial Purchasers or Selling Securityholder, the Company will reimburse
the Initial Purchasers for all out-of-pocket expenses approved in writing by the
Initial Purchasers, including fees and disbursements of counsel, reasonably
incurred by the Initial Purchasers in making preparations for the purchase of
the Securities.

         13. THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE
WITH THE LAWS OF THE STATE OF NEW YORK.

         14. This Agreement may be executed by any one or more of the parties
hereto and thereto in any number of counterparts, each of which shall be deemed
to be an original, but all such respective counterparts shall together
constitute one and the same instrument.

                                       22
<PAGE>   23

         If the foregoing is in accordance with your understanding, please sign
and return to us 6 counterparts hereof.

                                        Very truly yours,
                                        UBS AG, acting through its London Branch

                                        By: /s/ WILLIAM A. SULLIVAN
                                           -------------------------------------
                                             Name:  William A. Sullivan
                                             Title: Director, Legal and External
                                                    Affairs

                                        By: /s/ BRYAN MURTAGH
                                           -------------------------------------
                                             Name:  Bryan Murtagh
                                             Title: Executive Director, Legal
                                                    and External Affairs

                                        THE WILLIAMS COMPANIES, INC.

                                        By: /s/ DEBORAH S. FLEMING
                                           -------------------------------------
                                             Name:  Deborah S. Fleming
                                             Title: Treasurer

Accepted as of the date hereof:

UBS Warburg LLC
Credit Suisse First Boston Corporation
Lehman Brothers Inc.
ABN AMRO Incorporated
Banc of America Securities LLC
BMO Nesbitt Burns Corp.
Commerzbank Securities
Credit Lyonnais Securities
The Royal Bank of Scotland PLC
Scotia Capital Markets
TD Securities

By: UBS Warburg LLC
Acting on behalf of itself and the several Initial Purchasers

By: /s/ SCOTT K. GIESE
   -----------------------------

Name:  Scott K. Giese
     ---------------------------
Title: Executive Director
      --------------------------
      Global F1 Derivatives

By: /s/ GARY KAUFMAN
   -----------------------------

Name:  Gary Kaufman
     ---------------------------
Title: Executive Director
      --------------------------
      Global Rates Derivatives

<PAGE>   24

                                                                      SCHEDULE A

         PRINCIPAL AMOUNT OF SECURITIES TO BE PURCHASED FROM THE COMPANY

<TABLE>
<CAPTION>
                                                           A                       B
                                                   PRINCIPAL AMOUNT OF     PRINCIPAL AMOUNT OF
              INITIAL PURCHASER                     7.50% DEBENTURES           6.75% PATS                TOTAL
              -----------------                    -------------------     -------------------           -----

<S>                                                <C>                     <C>                      <C>
    UBS Warburg LLC                                     $120,000,000           $240,000,000           $360,000,000

    Credit Suisse First Boston Corporation              $ 25,000,000           $ 50,000,000           $ 75,000,000

    Lehman Brothers Inc.                                $ 25,000,000           $ 50,000,000           $ 75,000,000

    ABN AMRO Incorporated                               $  3,750,000           $  7,500,000           $ 11,250,000

    Banc of America Securities LLC                      $  3,750,000           $  7,500,000           $ 11,250,000

    BMO Nesbitt Burns Corp.                             $  3,750,000           $  7,500,000           $ 11,250,000

    Commerzbank Securities                              $  3,750,000           $  7,500,000           $ 11,250,000

    Credit Lyonnais Securities (USA) Inc.               $  3,750,000           $  7,500,000           $ 11,250,000

    The Royal Bank of Scotland plc                      $  3,750,000           $  7,500,000           $ 11,250,000

    Scotia Capital Markets                              $  3,750,000           $  7,500,000           $ 11,250,000

    TD Securities                                       $  3,750,000           $  7,500,000           $ 11,250,000
                                                        ------------           ------------           ------------

    TOTAL                                               $200,000,000           $400,000,000           $600,000,000
                                                        ============           ============           ============
</TABLE>

                                       2
<PAGE>   25

                                                                      SCHEDULE B

 PRINCIPAL AMOUNT OF SECURITIES TO BE PURCHASED FROM THE SELLING SECURITYHOLDER

<TABLE>
<CAPTION>
                                                                    A
                                                           PRINCIPAL AMOUNT OF
        INITIAL PURCHASER                                   7.50% DEBENTURES
        -----------------                                  -------------------

<S>                                                       <C>
         UBS Warburg LLC                                       $300,000,000

         Credit Suisse First Boston Corporation                $ 62,500,000

         Lehman Brothers Inc.                                  $ 62,500,000

         ABN AMRO Incorporated                                 $  9,375,000

         Banc of America Securities LLC                        $  9,375,000

         BMO Nesbitt Burns Corp.                               $  9,375,000

         Commerzbank Securities                                $  9,375,000

         Credit Lyonnais Securities (USA) Inc.                 $  9,375,000

         The Royal Bank of Scotland plc                        $  9,375,000

         Scotia Capital Markets                                $  9,375,000

         TD Securities                                         $  9,375,000
                                                               ------------

         TOTAL                                                 $500,000,000
                                                               ============
</TABLE>

                                       3

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00021-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00021-of-00352.parquet"}]]