Document:

EMPLOYMENT AGREEMENT

THIS  AGREEMENT  dated  for  reference  the  7th  day  of  August,  2003.

BETWEEN:

          MERCER  INTERNATIONAL  INC.,  a Massachusetts business trust organized
          ---------------------------
          under  the laws of the State of Washington with an office at Suite 282
          -  14900  Interurban  Avenue  South,  Seattle,  Washington,  USA 98168

          (hereinafter  referred  to  as  the  "Corporation")

                                                               OF THE FIRST PART
AND:

          DAVID  M.  GANDOSSI,  Businessman
          -------------------

          (hereinafter  referred  to  as  the  "Executive")

                                                              OF THE SECOND PART

WHEREAS:

A.   The Corporation is engaged in the business of pulp and paper production and
     related  activities  and, among other things, operates a kraft pulp mill in
     Germany,  referred to as the "Rosenthal Mill", that produces softwood kraft
     pulp  and  two  paper mills in Heidenau and Fahrbruke, Germany, and owns an
     interest  in and is implementing a "greenfield" project, referred to as the
     "Stendal  Project",  to  construct  a softwood kraft pulp mill near Stendal
     Germany;

B.   The  Corporation  recognizes that the Executive has acquired special skills
     and  experience  in  the  pulp and paper industry and desires to employ the
     Executive  as  the  Chief  Financial  Officer, Executive Vice-President and
     Secretary  of  the  Corporation  as  of  the  Effective  Date;  and

C.   Both  the Corporation and the Executive wish formally to agree to the terms
     and  conditions  of the Executive's employment with the Corporation and the
     terms  and  conditions  that will, in certain circumstances hereinafter set
     forth,  govern  in  the  event  of  a  termination of the employment of the
     Executive  by  the  Corporation.

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                                        2

NOW  THEREFORE  in  consideration  of  the  premises  hereof  and  of the mutual
covenants  and  agreements hereinafter set forth and for other good and valuable
consideration,  the  receipt and sufficiency of which are hereby acknowledged by
each  of  the  parties hereto, the parties hereby covenant and agree as follows:

                                    ARTICLE I
                                    RECITALS

1.1  Recitals.  The parties hereby represent and warrant that the above recitals
     are  true  and  correct.

                                   ARTICLE II
                                 INTERPRETATION

2.1  Headings. The headings of the Articles, Sections and subsections herein are
     inserted for convenience of reference only and shall not affect the meaning
     or  construction  hereof.

2.2  Definitions.  For the purposes of this Agreement, the following terms shall
     have  the  following  meanings,  respectively:

     (a)  "Accrued Benefits" has the meaning ascribed to such term in subsection
          4.1(b)(iv)  hereof;

     (b)  "Agreement"  means  this  Employment  Agreement  and all schedules and
          amendments  hereto;

     (c)  "Annual Bonus" has the meaning ascribed to such term in Section 3.6(a)
          hereof;

     (d)  "Base  Salary" has the meaning ascribed to such term in Section 3.6(a)
          hereof;

     (e)  "Board"  means  the  board  of  Trustees  of  the  Corporation;

     (f)  "Change  of  Control"  means  the  occurrence  of any of the following
          events:

          (i)  The  receipt  by  the  Corporation  of  a  Schedule  13D or other
               statement  filed  under  Section  13(d)  of  the  Exchange  Act
               indicating  that  any  "person" (as such term is used in Sections
               13(d)  and  14(d)  of  the  Exchange  Act):  (a)  has  become the
               "beneficial  owner"  (as defined in Rule 13d-3 under the Exchange
               Act),  directly  or  indirectly, of securities of the Corporation
               representing  more than 20% of the Common Shares; or (b) has sole
               and/or shared voting, or dispositive, power over more than 20% of
               the  Common  Shares;  or

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                                        3

          (ii) A  change  in  the  composition  of  the Board occurring within a
               two-year  period prior to such change, as a result of which fewer
               than  a  majority  of  the  Trustees  are  Incumbent  Trustees.
               "Incumbent  Trustees"  shall  mean  Trustees  who are either: (a)
               Trustees  of  the  Corporation  as  of the Effective Date; or (b)
               elected,  or  nominated  for  election,  to  the  Board  with the
               affirmative  votes of at least a majority of the Trustees who had
               been  Trustees  two  (2)  years prior to such change and who were
               still  in  office  at the time of such election or nomination; or

          (iii) The solicitation of a dissident proxy, or any proxy not approved
               by  the Incumbent Trustees, the purpose of which is to change the
               composition  of  the  Board with the result, or potential result,
               that  fewer  than  a  majority  of the Trustees will be Incumbent
               Trustees;  or

          (iv) The  consummation  of  a merger, amalgamation or consolidation of
               the  Corporation  with  or  into  another  entity  or  any  other
               corporate reorganization, if more than 50% of the combined voting
               power  of  the  continuing  or  surviving  entity's  securities
               outstanding  immediately  after  such  merger,  amalgamation,
               consolidation or reorganization are owned by persons who were not
               stockholders of the Corporation immediately prior to such merger,
               amalgamation,  consolidation  or  reorganization;  or

          (v)  The  commencement  by  an entity, person or group (other than the
               Corporation or a wholly owned subsidiary of the Corporation) of a
               tender  offer,  an  exchange  offer or any other offer or bid for
               more  than  20%  of  the  Common  Shares;  or

          (vi) The  consummation  of  a  sale,  transfer  or  disposition by the
               Corporation  of  all  or  substantially  all of the assets of the
               Corporation;  or

          (vii) The commencement of any proceeding by or against the Corporation
               seeking  to  adjudicate  it  a  bankrupt or insolvent, or seeking
               liquidation, winding-up, reorganization, arrangement, adjustment,
               protection,  relief  or  composition  of  the  Corporation or its
               debts,  under  any  law  relating  to  bankruptcy,  insolvency or
               reorganization  or  relief of debtors, or seeking the entry of an
               order  for  relief or for the appointment of a receiver, trustee,
               custodian or other similar official for it or for any substantial
               part  of  its  property;  or

          (viii)  The  approval by the shareholders of the Corporation of a plan
               of  complete  liquidation  or  dissolution  of  the  Corporation.

          In  the  case  of  the  occurrence  of  any of the events set forth in
          subsection  2.2.(f)(vii), a Change of Control shall be deemed to occur
          immediately prior to the occurrence of any such events. An event shall
          not  constitute  a  Change of Control if its sole purpose is to change
          the  jurisdiction  of  the  Corporation's

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                                        4

          organization or to create a holding company, partnership or trust that
          will be owned in substantially the same proportions by the persons who
          held  the  Corporation's  securities  immediately  before  such event.
          Additionally, a Change of Control will not be deemed to have occurred,
          with  respect  to  the  Executive,  if  the  Executive  is  part  of a
          purchasing  group  that  consummates  the  Change  of  Control  event;

     (g)  "Common  Shares" means the issued and outstanding shares of beneficial
          interest  of  the  Corporation;

     (h)  "Compensation  Committee" means the independent committee of the Board
          consisting  of  two  or more Trustees, not employed by the Corporation
          and  each  of whom is a Disinterested Trustee (as defined in the Stock
          Option  Plan),  which  committee is responsible for making any and all
          decisions  to  award  stock  options  under  the  Stock Option Plan to
          officers of the Corporation, and in the event the Corporation does not
          have  a  Compensation  Committee all references herein to Compensation
          Committee  shall  be  deemed  to  refer  to  the  Board  as  a  whole;

     (i)  "Date of Termination" means the date of termination of the Executive's
          employment  with  the  Corporation;

     (j)  "Disability"  shall  mean  the  Executive's  failure  to substantially
          perform  his  material duties for the Corporation on a full-time basis
          for  twelve  (12) consecutive months as a result of physical or mental
          incapacity;

     (k)  "Disability  Termination"  has the meaning ascribed thereto in Section
          4.1  hereof;

     (l)  "Effective  Date"  means  August  15,  2003;

     (m)  "Exchange  Act"  means  the  Securities  Exchange Act of 1934, and the
          rules  and  regulations  promulgated  thereunder,  as  the same may be
          amended,  modified  or  restated  and  any  successor  or  replacement
          thereto;

     (n)  "Good Reason" means, without the written consent of the Executive, the
          occurrence  of  any  of  the  following  events:

          (i)  Any  material  reduction or diminution (except temporarily during
               any  period of physical or mental incapacity or disability of the
               Executive)  in  the  Executive's titles, status or positions, any
               material  reduction  or  diminution in the Executive's authority,
               duties  or  responsibilities  with the Corporation (including any
               position  or  duties  as  a  Trustee  of  the Corporation and the
               failure to re-elect the Executive as a Trustee and to the Board),
               it  being  acknowledged that, in the event any entity becomes the
               owner,  directly,  indirectly,  beneficially or otherwise of more
               than  50%  of  the  Common Shares, it shall be Good Reason if the
               Executive  is  not  the  Chief  Financial Officer of such entity;

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                                        5

          (ii) A  breach  by  the  Corporation of any material provision of this
               Agreement,  including,  but  not  limited  to,  a  breach  of the
               obligations  of  the  Corporation under Sections 3.6, 5.1 and 6.8
               (other  than a reduction in the Executive's Base Salary that does
               not  exceed  an aggregate of ten percent (10%) of the Executive's
               then  current  Base  Salary and which reduction applies, in equal
               percentages,  to  all  senior officers of the Corporation) or any
               failure  to  timely  pay any part of the Executive's compensation
               hereunder,  including,  without  limitation, the Executive's Base
               Salary,  Annual  Bonus and any other bonuses payable to him or to
               materially  provide,  in  the  aggregate,  the  level of benefits
               contemplated  herein;

          (iii)  The  failure  of  the  Corporation to obtain and deliver to the
               Executive  a  written  agreement, in the form satisfactory to the
               Executive  acting  reasonably,  to  be  entered  into  with  any
               successor,  assignee  or  transferee of the Corporation to assume
               and  agree  to  perform this Agreement in accordance with Section
               6.10  hereof,  other  than in the case of a Permitted Assignment;

          (iv) Any  failure  by  or of the Corporation to continue in effect any
               benefit,  bonus,  profit  sharing,  incentive,  remuneration,
               compensation, stock ownership, stock purchase, stock option, life
               insurance,  disability,  pension or retirement plans in which the
               Executive  is  participating  or  entitled to participate, or the
               Corporation  takes,  or fails to take, any action that materially
               adversely  affects  the  Executive's participation in, or reduces
               his  rights  or benefits, under or pursuant to such plans, or the
               Corporation  fails to increase or improve such rights or benefits
               on  a  basis  consistent  with  practices in effect prior to such
               failure,  or with practices implemented subsequent to a Change of
               Control,  with  respect  to  senior  officers of the Corporation;

          (v)  Any  failure by the Corporation to provide the Executive with the
               number  of  paid  vacation  days  to which he is entitled, as set
               forth  herein,  or  the Corporation failing to increase such paid
               vacation  days  on  a  basis  consistent with practices in effect
               prior  to  such failure, or with practices implemented subsequent
               to  a  Change  of Control, with respect to the senior officers of
               the  Corporation;  and

          (vi) The Corporation taking any action to deprive the Executive of any
               material  fringe benefit enjoyed by him immediately prior to such
               deprivation  or  the  Corporation  failing to increase or improve
               such  material  fringe  benefits  on  a  basis  consistent  with
               practices  in effect prior to such deprivation, or with practices
               implemented  subsequent  to  a Change of Control, with respect to
               senior  officers  of  the  Corporation;

     (o)  "Incumbent  Trustees"  has  the  meaning  ascribed  thereto in Section
          2.2(f)(ii);

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     (p)  "Incentive  Plan"  means the 2002 Employee Incentive Bonus Plan of the
          Corporation,  as the same may be amended, modified or restated and any
          replacement  or  successor  thereto;

     (q)  "Just  Cause"  means  the  occurrence  of any of the following events:

          (i)  Serious  misconduct,  dishonesty  or  disloyalty of the Executive
               directly  related  to  the  performance  of  his  duties  for the
               Corporation  which results from a willful act or omission or from
               gross  negligence  and  which  is  materially  injurious  to  the
               operations,  financial  condition  or  business reputation of the
               Corporation;

          (ii) Willful  and  continued failure by the Executive to substantially
               perform  his  duties  under  this  Agreement (other than any such
               failure  resulting  from his incapacity due to physical or mental
               disability  or  impairment);

          (iii) Any other material breach of this Agreement by the Executive; or

          (iv) Any  event  or  circumstance  that  would  constitute  cause  for
               termination  of  employment  at  law.

          For  purposes  of  this  Agreement,  no act, or failure to act, by the
          Executive shall be "willful" unless it is done, or omitted to be done,
          in  bad faith and without a reasonable belief that the act or omission
          was  in  the  best  interests  of  the  Corporation;

     (r)  "Market  Price"  means  on  any  date, the average market price of the
          Common Shares calculated as the simple average of the closing price of
          the  Common Shares as quoted through NASDAQ on each of the 10 business
          days  preceding  such  date  on  which  a  closing  price  was quoted;

     (s)  "NASDAQ"  means  the  National  Association of Stock Dealers Automated
          Quotation  System;

     (t)  "Permitted  Assignment"  means an assignment by the Corporation of the
          rights  and obligations of the Corporation contained in this Agreement
          to  a  wholly-owned  subsidiary of the Corporation resident in Canada,
          provided  that the Corporation is not, as a result of such assignment,
          relieved  of  its  liabilities,  obligations  and  duties  under  this
          Agreement;

     (u)  "Prime  Rate" means the rate of interest expressed as a rate per annum
          that  the  Royal  Bank  of  Canada,  at  its main branch in Vancouver,
          British  Columbia,  establishes and announces from time to time as the
          reference  rate  of  interest  that it will charge for Canadian dollar
          demand  loans to its customers in Canada and which it refers to as its
          "prime  rate";

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                                        7

     (v)  "Prorated  Bonus"  has the meaning ascribed to such term in subsection
          4.1(c)  hereof;

     (w)  "Stock  Option Plan" means the Amended and Restated 1992 Non-Qualified
          Stock  Option  Plan  of  the  Corporation, as the same may be amended,
          modified  or  restated  and  any replacement or successor thereto; and

     (x)  "Trustees"  means the trustees of the Corporation, and "Trustee" means
          any  one  of  them.

                                   ARTICLE III
                       TERMS AND CONDITIONS OF EMPLOYMENT

3.1  Employment.  The  Corporation does hereby employ the Executive as its Chief
     Financial  Officer,  Executive  Vice-President  and  Secretary,  and  the
     Executive  hereby  accepts  such  employment  by the Corporation, as of the
     Effective  Date,  all  upon and subject to the terms and conditions of this
     Agreement. The Executive agrees to serve, at no additional remuneration, in
     such  other  executive  capacities  and to assume such responsibilities and
     perform  such  duties  consonant  with  his position as an executive of the
     Corporation  as  the Chief Executive Officer ("CEO") of the Corporation may
     require and assign to him from time to time, including with subsidiaries of
     the  Corporation.

3.2  Duties  and  Functions.  The  Executive  shall  be responsible to and shall
     report  to  the  CEO.  The CEO may vary the conditions, duties and services
     provided  by  the  Executive from time to time according to the operational
     and  other  needs  of  the  business  of the Corporation, provided that his
     duties  will  reasonably  reflect  the  responsibilities  conferred by this
     Agreement. The Corporation expects the Executive to produce timely and good
     quality  work,  acting  in  a  competent, truthworthy and loyal manner. The
     Executive  agrees  to  carryout, using his reasonable best efforts and in a
     manner  that will promote the interests of the business of the Corporation,
     such  duties  and  functions  as  the  CEO  may  request from time to time,
     including,  but  not  limited  to,  the  duties  and functions set forth in
     Schedule  "A"  hereto.

3.3  Orders  of  Board.  The  Executive  shall always act in accordance with any
     reasonable  decision  of  and  obey and carry out all lawful and reasonable
     orders  given  to  him  by  the  CEO  and/or  the  Board.

3.4  Time  and  Energy.  Unless  prevented  by ill health, or physical or mental
     disability  or  impairment,  the  Executive  shall, during the term hereof,
     devote  sufficient business time, care and attention to the business of the
     Corporation  in  order  to  properly  discharge  his  duties  hereunder.

3.5  Faithful  Service.  The  Executive  shall  well  and  faithfully  serve the
     Corporation and use his reasonable efforts to promote the interests thereof
     and  shall  not  use  for  his own

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     purposes,  or  for  any  purposes  other than those of the Corporation, any
     non-public information he may acquire with respect to the business, affairs
     and  operations  of  the  Corporation.

3.6  Compensation. During the term of this Agreement, and any extension thereof,
     the  Corporation  shall  pay  and  provide  the  Executive  the  following:

     (a)  Signing  Bonus  and  Annual Cash Compensation. In consideration of the
          Executive  accepting  employment with the Corporation upon and subject
          to  the  terms  and  conditions  of  this  Agreement and the Executive
          foregoing  other employment opportunities, the Corporation shall, upon
          execution  of  this  Agreement,  pay  the Executive a one-time signing
          bonus of $75,000. As compensation for his services to the Corporation,
          the  Executive  shall receive a base salary (the "Base Salary") and in
          addition to the Base Salary shall be eligible to receive in respect of
          each  calendar  year  (or  portion  thereof)  additional variable cash
          compensation,  in  an  amount determined in accordance with any bonus,
          profit  sharing or short term incentive compensation program which may
          be  established  by  the  Board either for the Executive or for senior
          officers  of the Corporation (the "Annual Bonus"). As of the Effective
          Date, the Executive's annualized Base Salary shall be $320,000. During
          the term of this Agreement the Board shall review the Executive's Base
          Salary  and  Annual  Bonus  then in effect at least annually to ensure
          that  such  amounts  are  competitive with awards granted to similarly
          situated  executives  of  publicly  held  companies  comparable to the
          Corporation  and shall increase such amounts as the Board may approve.
          The  Board  shall not reduce the Executive's Base Salary except as set
          forth  herein.  The  Board  may  reduce  the  Executive's  Base Salary
          provided such reduction in the Executive's Base Salary does not exceed
          an aggregate total of ten percent (10%) of the Executive's Base Salary
          in  effect  as  of  the Effective Date and which reduction applies, in
          equal  percentages,  to  all  senior  officers of the Corporation. The
          Executive's  Base  Salary  and  Annual  Bonus  shall  be  payable  in
          accordance  with  the  Corporation's  normal  payroll  practices,  as
          applicable, and shall be subject to deductions in respect of statutory
          remittances, including, without limitation, deductions for income tax,
          pension  plan  premiums and employment insurance premiums. No increase
          in  the  Executive's  Base  Salary  and  Annual Bonus shall be used to
          offset  or  otherwise reduce any obligations of the Corporation to the
          Executive  hereunder  or  otherwise.

     (b)  Incentive  Plan. The Executive shall be entitled to participate in the
          Incentive  Plan in accordance with the terms thereof as in effect from
          time to time. The Corporation agrees, in each fiscal year, to grant to
          the  Executive  units under the Incentive Plan in such amount annually
          as  determined  by  the Board based on the Executive's Base Salary and
          Annual  Bonus  in  such year, before deduction for income tax, pension
          plan  premiums,  employment  insurance  premiums  and  other statutory
          remittances.

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                                        9

     (c)  Employee  Benefits.  The  Executive  shall, to the extent eligible, be
          entitled  to  participate at a level commensurate with his position in
          all  of  the  Corporation's  employee  benefit, welfare and retirement
          plans  and programs, as well as equity plans, employee incentive plans
          and bonus plans, provided by the Corporation to its senior officers in
          accordance  with  the  terms  thereof  as in effect from time to time.

     (d)  Automobile. The Executive shall be entitled to the lease and use of an
          automobile  pursuant  to  the  Corporation's policy on automobiles for
          executives  as  may  be  in  effect  from  time  to  time.

     (e)  Perquisites.  The  Corporation  shall  provide  the  Executive, at the
          Corporation's  cost,  with all perquisites which other senior officers
          of  the Corporation are entitled to receive and such other perquisites
          which  are  suitable to the character of the Executive's position with
          the  Corporation  and  adequate  for  the  performance  of  his duties
          hereunder.  To  the  extent legally permissible under applicable laws,
          the  Corporation  shall  not  treat  such  amounts  as  income  to the
          Executive.

     (f)  Business  and  Entertainment  Expenses. Upon submission of appropriate
          documentation  in  accordance with its policies in effect from time to
          time,  the  Corporation  shall  pay or reimburse the Executive for all
          business expenses which the Executive incurs in the performance of his
          duties  under  this  Agreement, including, but not limited to, travel,
          entertainment,  professional  dues  and  subscriptions,  and all dues,
          fees, and expenses associated with membership in various professional,
          business,  and civic associations and societies in which the Executive
          participates  in  accordance with the Corporation's policies in effect
          from  time  to  time.

3.7  Term.  Subject  to  the  terms  of  Article IV hereof, this Agreement shall
     remain  in effect for a period of thirty-six (36) months from the Effective
     Date.  In the event that the Corporation does not deliver written notice to
     the  Executive,  not  later  than  12 months prior to the expiration of the
     original  term, that the Corporation does not wish to renew this Agreement,
     the  term  hereof  shall  renew  automatically  for an additional period of
     twelve (12) months from the expiration of the original term. Thereafter, it
     shall  automatically  renew  for successive periods of 12 months unless the
     Corporation  provides written notice to the Executive that it does not wish
     to  renew  the term of this Agreement at least 360 days prior to the expiry
     of  the  applicable  term  hereof.

3.8  Amounts  Payable  considered  Debt.  All amounts payable by the Corporation
     under  this  Agreement  shall constitute a debt owing by the Corporation to
     the  Executive.

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                                        10

                                   ARTICLE IV
                 OBLIGATIONS OF THE CORPORATION UPON TERMINATION

4.1  Death  or  Disability.  The  Corporation  may  terminate  the  Executive's
     employment  in  the  event  the  Executive  has  been unable to perform his
     material  duties  hereunder  because  of Disability by giving the Executive
     notice  of  such termination while such Disability continues (a "Disability
     Termination").  The Executive's employment shall automatically terminate on
     the  Executive's  death.  In  the event the Executive's employment with the
     Corporation  terminates  during the term of this Agreement by reason of the
     Executive's death or as a result of a Disability Termination, then upon and
     immediately  effective  the  Date  of  Termination:

     (a)  the  Executive  shall  be fully and immediately vested in the unvested
          options  or equity awards granted by the Corporation to the Executive,
          that  are unvested on the Date of Termination so that such options and
          equity  awards are fully and immediately exercisable by the Executive;

     (b)  the  Corporation  shall  promptly pay and provide the Executive (or in
          the  event  of  the  Executive's  death,  the  Executive's  estate):

          (i)  any  unpaid  Base  Salary and any outstanding and accrued regular
               and  special  vacation  pay  through  the  Date  of  Termination;

          (ii) any unpaid Annual Bonus and other bonuses accrued with respect to
               the  fiscal  year ending on or preceding the Date of Termination;

          (iii)  reimbursement for any unreimbursed expenses incurred through to
               the  Date  of  Termination;

          (iv) all  other  payments,  benefits  or  fringe benefits to which the
               Executive  may  be entitled subject to and in accordance with the
               terms  of  any  applicable  compensation  arrangement or benefit,
               equity  or  fringe  benefit plan or program or grant, and amounts
               which  may become due under this Agreement (the payments referred
               to  herein  in  subsections  4.1(b)(i)  to  4.1(b)(iv)  shall,
               collectively,  be  referred  to  as  "Accrued  Benefits");  and

          (v)  any  unpaid amounts payable under the Incentive Plan with respect
               to  the  fiscal  year  ending  on  or  preceding  the  Date  of
               Termination;  and

     (c)  the  Corporation  shall  pay  to the Executive (or in the event of the
          Executive's  death,  the  Executive's estate) at the time other senior
          executives  are paid under any cash bonus or long term incentive plan,
          a  pro  rata Annual Bonus equal to the amount the Executive would have
          received  if  his  employment  continued  (without  any  discretionary
          cutback) multiplied by a fraction where the numerator is the number of
          days  in  each  respective  bonus  period  prior  to  the  Executive's

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                                        11

          termination  and  the  denominator  is the number of days in the bonus
          period  (the  "Prorated  Bonus").

4.2  Termination  for  Just Cause. The Corporation may terminate the Executive's
     employment  for  Just  Cause.  In the event that the Executive's employment
     with the Corporation is terminated during the term of this Agreement by the
     Corporation  for  Just  Cause,  the  Executive shall not be entitled to any
     additional  payments  or benefits hereunder (including, without limitation,
     any  payments  under  the  Incentive Plan), other than the Accrued Benefits
     (including,  but  not  limited to, any then vested options or equity grants
     granted  by  the Corporation to the Executive) and the Prorated Bonus which
     the  Corporation shall pay or provide to the Executive immediately upon the
     Date  of  Termination.

4.3  Voluntary  Termination  for Good Reason; Involuntary Termination Other Than
     for  Just  Cause.  The  Executive  may  terminate  his  employment with the
     Corporation  for  Good  Reason  at any time within one hundred eighty (180)
     days after the occurrence of the Good Reason event by written notice to the
     Corporation.  If  the  Executive's  employment  with  the  Corporation  is
     voluntarily  terminated  by  the  Executive  for  "Good  Reason"  or  is
     involuntarily  terminated  by  the Corporation other than for "Just Cause",
     then the Corporation shall pay or provide the Executive with the following:

     (a)  any  Accrued  Benefits;

     (b)  any  unpaid  amounts  payable under the Incentive Plan with respect to
          the  fiscal  year  ending  on  or  preceding  the Date of Termination;

     (c)  subject  to (d) below, a severance amount equal to the sum of: (A) the
          Executive's  then Base Salary payable in respect of the then remaining
          term of this Agreement; and (B) the Executive's Annual Bonuses payable
          in  respect of the calendar years (or portions thereof) then remaining
          in  the term of this Agreement, which bonuses will be calculated based
          on  the  higher  of (x) the Executive's then current Annual Bonus, (y)
          the highest variable pay and incentive bonus received by the Executive
          from  the Corporation for the three (3) fiscal years last ending prior
          to such termination and (z) the amount equal to 50% of the Executive's
          then  current  Base  Salary,  which  severance  amount  is  payable in
          substantially equal installments over twelve (12) months in accordance
          with  the  Corporation's standard payroll practice; provided, however,
          that  in  the event of a Change of Control following such termination,
          the  unpaid portion of such severance amount, if any, shall be paid to
          the  Executive  in  full in a single lump sum cash payment immediately
          following  such  Change  of  Control;

     (d)  if  such  termination  occurs  in contemplation of, at the time of, or
          within  eighteen  (18) months after a Change of Control, the Executive
          shall  instead  be  entitled  to  a  lump sum cash payment immediately
          following  such  termination  equal to three (3) times the sum of: (A)
          the  Executive's  then  Base  Salary;  and  (B)  the higher of (x) the
          Executive's  then  current  Annual Bonus, (y) the highest variable pay
          and

<PAGE>

                                        12

          annual  incentive  bonus  received  by the Executive for the three (3)
          fiscal  years last ending prior to such termination and (z) the amount
          equal  to  50%  of  the  Executive's  then  current  Base  Salary; and

     (e)  the  Executive  shall  be fully and immediately vested in the unvested
          options  or  equity awards granted by the Corporation to the Executive
          so  that  such  options  and  equity  awards are fully and immediately
          exercisable  by  the  Executive.

     For  greater  certainty, if such termination occurs in contemplation of, at
     the  time of, or within eighteen (18) months after a Change of Control, the
     Executive  shall  be  entitled to the payments set out in Subsection 4.3(d)
     hereof  and  will  not  be  entitled to any payments or other amounts under
     Subsection  4.3(c)  hereof  and  any amounts paid by the Corporation to the
     Executive  pursuant  to Subsection 4.3(c) shall be setoff from and credited
     as payments made by the Corporation to the Executive pursuant to Subsection
     4.3(d)  hereof.

4.4  Without Good Reason. The Executive may terminate his employment at any time
     without Good Reason by written notice to the Corporation. In the event that
     the  Executive's  employment  with the Corporation is terminated during the
     term  of this Agreement by the Executive without Good Reason, the Executive
     shall  not  be  entitled  to  any additional payments or benefits hereunder
     (including,  without  limitation,  any  payments under the Incentive Plan),
     other than Accrued Benefits (including, but not limited to, any then vested
     options  or  equity grants granted by the Corporation to the Executive) and
     the  Prorated  Bonus  which  the  Corporation  shall  pay or provide to the
     Executive  immediately  upon  the  Date  of  Termination.

4.5  Mitigation  and  Offset. In the event of the termination of the Executive's
     employment  under  this  Agreement;

     (a)  The Executive shall be under no obligation to seek other employment or
          otherwise  mitigate  the  value  of  any  compensation  or  benefits
          contemplated  by  this  Agreement,  nor shall any such compensation or
          benefits  be  reduced  in  any respect in the event that the Executive
          shall  secure,  or shall not reasonably pursue, alternative employment
          or  earnings or benefits that the Executive may receive from any other
          source;  and

     (b)  Except  as  otherwise  set  forth  herein,  the amounts payable by the
          Corporation  hereunder  shall  not  be  subject  to  setoff,  offset,
          counterclaim, recoupment, defence or other right which the Corporation
          may  have  against  the  Executive  or  others.

4.6  Change  of  Control  Vesting  Acceleration.  In  the  event of a "Change of
     Control",  immediately  effective  the  date of such Change of Control, the
     Executive  shall be fully and immediately vested in the unvested options or
     equity  awards  granted  by  the  Corporation  to  the  Executive, that are
     unvested  on the Date of Termination so that such options and equity awards
     are  fully  and  immediately  exercisable  by  the  Executive.

<PAGE>

                                        13

                                    ARTICLE V
                                 INDEMNIFICATION

5.1  Indemnification.  The  Corporation  hereby covenants and agrees that if the
     Executive  is  made  a  party,  or is threatened to be made a party, to any
     action,  suit  or  proceeding,  whether  civil, criminal, administrative or
     investigative  of  any nature whatsoever (a "Proceeding"), by reason of, or
     as a result of, the fact that he is or was an officer, employee, trustee or
     agent  of  the  Corporation  or  is  or  was  serving at the request of the
     Corporation  as  a trustee, director, officer, member, employee or agent of
     another corporation, partnership, joint venture, trust or other enterprise,
     including  service  with  respect to employee benefit plans, whether or not
     the  basis  of  such  Proceeding  is  the  Executive's alleged action in an
     official  capacity  while serving as an officer, employee, trustee or agent
     of the Corporation, the Executive shall be indemnified and held harmless by
     the  Corporation  to  the fullest extent legally permitted or authorized by
     the  Corporation's  constating  documents  or,  if  greater,  by applicable
     federal,  state  or  provincial  legislation,  against all costs, expenses,
     liability  and  losses  of  any  nature  whatsoever  (including,  without
     limitation, attorney's fees, judgments, fines, interest, taxes or penalties
     and  amounts  paid  or  to  be  paid  in settlement) reasonably incurred or
     suffered  by  the  Executive  in  connection  therewith  (collectively, the
     "Indemnification  Amounts"),  and such indemnification shall continue as to
     the  Executive  even  if he has ceased to be a officer, director, employee,
     trustee  or agent of the Corporation or other entity and shall inure to the
     benefit  of  the  Executive's  heirs,  executors  and  administrators.

5.2  Standard of Conduct. Neither the failure of the Corporation or the Board to
     have  made  a  determination  prior  to  the commencement of any proceeding
     concerning  payment  of  amounts claimed by the Executive under Section 5.1
     hereof  that  indemnification of the Executive is proper because he has met
     the  applicable standard of conduct, nor a determination by the Corporation
     or  the  Board  that  the Executive has not met such applicable standard of
     conduct,  shall  create  a  presumption  that the Executive has not met the
     applicable  standard  of  conduct.

                                   ARTICLE VI
                                     GENERAL

6.1  No  Prohibition on Employment. The Executive shall not be prohibited in any
     manner  whatsoever  from  obtaining employment with or otherwise forming or
     participating  in a business competitive to the business of the Corporation
     after  termination  of  employment  with  the  Corporation.

6.2  Resignation  of  Positions.  The Executive agrees that after termination of
     his employment with the Corporation he will tender his resignation from any
     position  he may hold as an officer, director or trustee of the Corporation
     or  any  of  its  affiliated or associated companies if so requested by the
     Board.

<PAGE>

                                        14

6.3  Rights  and  Obligations  Survive. The respective rights and obligations of
     the  parties  hereunder  shall  survive  any termination of the Executive's
     employment to the extent necessary to preserve such rights and obligations.
     For  greater  certainty,  notwithstanding  anything to the contrary in this
     Agreement, the parties hereto acknowledge and agree that Sections 4.1, 4.2,
     4.3,  4.5,  4.6, 5.1, 6.3, 6.5, 6.7, 6.8, 6.13, 6.14 and 6.16 shall survive
     the  termination  of  the  Executive's  employment with the Corporation and
     remain  in  full  force  and  effect.

6.4  Beneficiaries.  The  Executive  shall  be entitled, to the extent permitted
     under  any  applicable  law,  to  select  and  change  a  beneficiary  or
     beneficiaries  to  receive  any  compensation  or benefit payable hereunder
     following  the  Executive's  death by giving the Corporation written notice
     thereof.  In the event of the Executive's death or a judicial determination
     of  his incompetence, reference in this Agreement to the Executive shall be
     deemed,  where  appropriate,  to  refer to his beneficiary, estate or other
     legal  representative.

6.5  Independent  Legal  Advice. The Executive hereby represents and warrants to
     the  Corporation and acknowledges and agrees that he had the opportunity to
     seek, was not prevented nor discouraged by the Corporation from seeking and
     did obtain, independent legal advice prior to the execution and delivery of
     this  Agreement.

6.6  Fair  and  Reasonable Provisions. The Corporation and Executive acknowledge
     and  agree that the provisions of this Agreement regarding further payments
     of  the  Executive's  Base  Salary, Annual Bonus and other bonuses, and the
     exercisability  and  vesting of the options or equity grants granted by the
     Corporation to the Executive, constitute fair and reasonable provisions for
     the consequences of such termination, do not constitute a penalty, and such
     payments  and  benefits  shall  not  be  limited  or reduced by amounts the
     Executive  might  earn  or  be  able  to  earn from any other employment or
     ventures  during  the  remainder  of  the  agreed  term  of this Agreement.

6.7  Lump  Sum  Payment.  Except  as  otherwise  specifically  provided  in this
     Agreement, the Corporation shall pay the Executive any lump sum payment due
     to  him  under  this Agreement within ten (10) business days of the Date of
     Termination.  Any  payments  due to the Executive under this Agreement that
     are  not paid within such time shall accrue interest, compounded quarterly,
     on  the  total unpaid amount payable under this Agreement, such interest to
     be  calculated  at  a  rate equal to 2% in excess of the Prime Rate then in
     effect  from  time  to  time  during  the  period  of  such  non-payment.

6.8  Liability  Insurance. The Corporation shall use its reasonable best efforts
     to  obtain  and  continue  coverage  of  the  Executive  under trustees and
     officers  liability  insurance  both  during and, while potential liability
     exists,  after  the Executive's employment with the Corporation in the same
     amount  and to the same extent, if any, as the Corporation covers its other
     trustees  and/or  officers.

6.9  No  Derogation  of  Rights.  Nothing  herein  derogates from any rights the
     Executive  may  have  under  applicable  law.

<PAGE>

                                        15

6.10 Assignability.  This  Agreement  shall  be  binding  upon  and inure to the
     benefit  of  the  parties hereto and their respective successors, heirs (in
     the  case  of  the  Executive) and assigns. No rights or obligations of the
     Corporation  under  this  Agreement  may  be assigned or transferred by the
     Corporation  except:  (i) in the case of a "Permitted Assignment"; and (ii)
     such  rights  or  obligations  may be assigned or transferred pursuant to a
     merger, amalgamation, reorganization, continuance or consolidation in which
     the Corporation is not the continuing entity, or the sale or liquidation of
     all  or  substantially  all of the assets of the Corporation, provided that
     the  assignee or transferee is the successor to all or substantially all of
     the  assets  of the Corporation and such assignee or transferee assumes the
     liabilities,  obligations  and  duties  of the Corporation, as contained in
     this  Agreement,  either  contractually or as a matter of law. No rights or
     obligations  of  the  Executive  under  this  Agreement  may be assigned or
     transferred by the Executive other than: (a) his rights to compensation and
     benefits, in whole or in part, which may be transferred by the Executive to
     (i)  a  corporation  owned or controlled by the Executive or members of the
     Executive's  family,  and  (ii) a trust, the beneficiaries of which are the
     Executive  or  members  of  the  Executive's  family;  (b) to a corporation
     through  which  the  Executive  shall  provide the services required of him
     hereunder;  and  (c)  as  provided  in  Section  6.4  hereof.

6.11 Authorization.  The  Corporation  represents  and warrants that it is fully
     authorized  and  empowered  to  enter  into  this Agreement and perform its
     obligations  hereunder,  which  performance  will not violate any agreement
     between  the  Corporation  and  any  other person, firm or organization nor
     breach any provisions of its constating documents or governing legislation.

6.12 Amendment  or  Waiver. No provision in this Agreement may be amended unless
     such  amendment  is agreed to in writing and signed by the Executive and an
     authorized  officer of the Corporation. No waiver by either party hereto of
     any  breach  by  the  other  party  hereto  of  any  condition or provision
     contained  in  this  Agreement to be performed by such other party shall be
     deemed  a  waiver  of a similar or dissimilar condition or provision at the
     same  or  any  prior  or subsequent time. Any waiver must be in writing and
     signed by the Executive or an authorized officer of the Corporation, as the
     case  may  be.

6.13 Interpretation  of Incentive Plan, Stock Option Plan and Option Agreements.
     In  the  event  of  a  conflict between, or inconsistency with, any, or any
     part,  of  the  terms  or  provisions  of  this  Agreement and the terms or
     provisions  of  the  Incentive  Plan,  the  Stock Option Plan or any option
     agreements  entered into pursuant to the Stock Option Plan, as the case may
     be,  the  terms and provisions of this Agreement shall be deemed to govern,
     supersede,  and take precedence over such inconsistent or conflicting terms
     and  provisions  contained in the Incentive Plan, the Stock Option Plan and
     the  option  agreements  entered into pursuant to the Stock Option Plan, as
     the  case  may  be.

6.14 Governing  Law and Venue. This Agreement shall be construed and interpreted
     in  accordance  with  the laws of the Province of British Columbia, and the
     federal  laws  of  Canada  applicable  therein.  Each of the parties hereby
     irrevocably  attorns to the non-exclusive jurisdiction of the Supreme Court
     of  British  Columbia, situate in Vancouver, British Columbia, with respect
     to  any  matters  arising  out  of  this  Agreement.

<PAGE>

                                        16

6.15 Notices.  Any notice required or permitted to be given under this Agreement
     shall  be  in writing and shall be properly given if delivered or mailed by
     prepaid  registered  mail  addressed  as  follows:

     (a)  in  the  case  of  the  Corporation:

          Mercer International Inc.
          Suite 14900 Interurban Avenue South
          Seattle, Washington,  USA  98168

     (b)  in  the  case  of  the  Executive:

          to the last address of the Executive in the records of the Corporation
          and  its subsidiaries or to such other address as the parties may from
          time  to  time  specify  by  notice  given  in  accordance  herewith.

          Any notice so given shall be conclusively deemed to have been given or
          made  on the day of delivery, if delivered, or if mailed as aforesaid,
          upon  the  date  shown  on  the postal return receipt as the date upon
          which the envelope containing such notice was actually received by the
          addressee.

6.16 Severability. If any provision contained herein is determined to be void or
     unenforceable  for  any reason, in whole or in part, it shall not be deemed
     to  affect  or  impair the validity of any other provision contained herein
     and  the  remaining provisions shall remain in full force and effect to the
     fullest  extent  permissible  by  law.

6.17 Entire  Agreement. Other than the Officer's Indemnity Agreement between the
     Executive  and  the  Corporation  of  even  date  herewith  (the "Indemnity
     Agreement"), this Agreement contains the entire understanding and agreement
     between the parties concerning the subject matter hereof and supersedes all
     prior  agreements,  understandings,  discussions,  negotiations  and
     undertakings,  whether  written  or  oral, between the parties with respect
     thereto. For greater certainty, notwithstanding anything to the contrary in
     this  Agreement,  the  parties  hereto  acknowledge  and agree that nothing
     contained herein is intended to modify, abridge, limit or affect any of the
     rights  or  obligations  of  the  parties hereto contained in the Indemnity
     Agreement.

6.18 Currency.  Unless  otherwise  specified  herein all references to dollar or
     dollars  are  references  to  Canadian  dollars.

6.19 Further  Assurances.  Each  of  the  Executive and the Corporation will do,
     execute  and deliver, or will cause to be done, executed and delivered, all
     such further acts, documents and things as the Executive or the Corporation
     may  require  for  the  purposes  of  giving  effect  to  this  Agreement.

<PAGE>

                                        17

6.20 Counterparts/Facsimile Execution. This Agreement may be executed in several
     parts  in  the  same  form, and by facsimile, and such parts as so executed
     shall  together  constitute  one original document, and such parts, if more
     than  one,  shall  be  read  together  and  construed as if all the signing
     parties  had  executed  one  copy  of  the  said  Agreement.

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

MERCER  INTERNATIONAL  INC.

By: /s/ Jimmy Lee
    ----------------------------------------
Name:  Jimmy Lee
      --------------------------------------
Title: President
      --------------------------------------

SIGNED,  SEALED  and  DELIVERED     )
by  DAVID  M.  GANDOSSI             )
in  the  presence  of:              )
/s/ M.Y. Ho                         )     /s/ David Gandossi
----------------------------------  )     --------------------------
Witness                             )     DAVID  M.  GANDOSSI
1620 - 400 Burrard Street           )
----------------------------------  )
Address                             )
Vancouver, B.C.                     )
----------------------------------  )
----------------------------------  )
----------------------------------  )
Occupation

<PAGE>

                                       A-1

                                   SCHEDULE A

                               EXECUTIVE'S DUTIES

1.   Supervision  and  management  of  all  accounting  and  financial reporting
     functions  of  the  Corporation;

2.   Supervision  and  management  of  all  treasury,  receivable  and  payable
     functions  of  the  Corporation;

3.   Supervision  and management of all banking arrangements of the Corporation;

4.   Supervision  and  management  of all other internal financial functions and
     controls  of  the  Corporation;

5.   Supervision and management of all employees in the financial and accounting
     departments  of  the  Corporation;

6.   Supervision  and management of investor relations and corporate information
     dissemination  of  the  Corporation;

7.   Supervision  and  management  of all corporate secretarial functions of the
     Corporation,  including,  without  limitation, preparation of, or providing
     assistance in the preparation of, all materials in connection with meetings
     of  the  Board,  preparation of, or providing assistance in the preparation
     of,  all  materials  in  connection  with meetings of holders of the Common
     Shares,  and  maintaining  the  corporate  minute books of the Corporation.

8.   Preparation  of  all budgets and business plans, and reporting on the same;

9.   Participation in the development of policies and programs, and reporting on
     the  same;  and

10.  Performance  of  such  other  functions  and duties normally performed by a
     chief  financial  officer  and/or executive vice-president of publicly held
     companies  comparable  to  the  Corporation,  and  such  other  duties  and
     functions  consistent  with  the  Executive's position which the CEO shall,
     from  time  to  time,  reasonably  direct.Copyright 1999 Disclosure Incorporated

Exhibit 10.1

 

Revised 7/15/2003

FORM OF 

EMPLOYMENT CONTINUITY AGREEMENT

THIS AGREEMENT dated as of _____________ (the "Agreement Date") is made by and between Dominion Resources, Inc. ("DRI" or the "Company"), a Virginia corporation, and __________ (the "Executive"). 

ARTICLE I

PURPOSES

The Board of Directors of DRI (the "Board") has determined that it is in the best interests of the Company and its shareholders to assure that the Company will have the continued services of the Executive, despite the possibility or occurrence of a Change in Control of the Company. The Board believes that this objective may be achieved by giving key management employees assurances of financial security in case of a pending or threatened change in control, so that they will not be distracted by personal risks and will continue to devote their full time and best efforts to the performance of their duties. The Board also wants to provide the Executive with compensation and benefits arrangements upon a Change in Control which are competitive with those of similarly situated corporations. 

ARTICLE II

CERTAIN DEFINITIONS

When used in this Agreement, the terms specified below shall have the following meanings:
2.1       "Agreement Term" means:
(a)  Except as provided in Section 2.1(b), the Period commencing on the Agreement Date and ending on the third anniversary of the Agreement Date. Commencing on the third anniversary of the Agreement Date and each subsequent anniversary of the Agreement Date, the Agreement Term shall be automatically extended for an additional one-year term, unless at least 30 days prior to the last day of any such extended Agreement Term, the Company shall give notice to the Executive that the Agreement Term shall not be extended. The Agreement Term shall include the Employment Period.

(b)  If a Potential Change in Control (as defined below) occurs, the Agreement Term shall be automatically extended to the later of (i) the period described in Section 2.1(a) or (ii) 30 days after the date the Change in Control is completed or a public announcement is made that the transaction will not occur (the "Change in Control Extension"). Commencing on the day immediately after the expiration of the Change in Control Extension, and each subsequent anniversary of such day, the Agreement Term shall be automatically extended for an additional one-year term, unless at least 30 days prior to the last day of the Change in Control Extension or of any such extended Agreement Term, the Company shall give notice to the Executive that the Agreement Term shall not be extended. A Potential Change in Control shall be deemed to have occurred if (i) the Company enters into an agreement, the consummation of which would result in the occurrence of a Change in Control of the Company, (ii) the Company or any person publicly announces an intention to take or to consider taking actions which, if consummated, would constitute a Change in Control of the Company; or (iii) the Board adopts a resolution to the effect that a Potential Change in Control of the Company has occurred for purposes of this Agreement.

2.2       "Accrued Obligation" See Section 5.4(a).

2.3       "Annual Base Salary" See Section 3.2(a).

2.4       "Annual Bonus" See Section 3.2(b).

2.5       "Bonus Plan" See Section 3.2(b).

2.6       "Cause" See Section 4.3.

2.7       "Change in Control" means:
(a) any person, including a "group" as defined in Section 13(d)(3) of the Act becomes the owner or beneficial owner of DRI securities having 20% or more of the combined voting power of the then outstanding DRI securities that may be cast for the election of DRI's directors (other than as a result of an issuance of securities initiated by DRI, or open market purchases approved by the DRI Board, as long as the majority of the DRI Board approving the purchases is also the majority at the time the purchases are made); or

(b) as the direct or indirect result of, or in connection with, a cash tender or exchange offer, a merger or other business combination, a sale of assets, a contested election, or any combination of these transactions, the persons who were directors of DRI before such transactions cease to constitute a majority of the DRI Board, or any successor's board, within two years of the last of such transactions.

2.8      "Code" means the Internal Revenue Code of 1986, as amended

2.9      "Company Certificate" See Section 6.1.

2.10    "Disability" See Section 4.1.

2.11     "Disability Effective Date" See Section 4.1

2.12     "Effective Date" means the first date during the Agreement Term on which a Change in Control occurs. Anything in this Agreement to the contrary notwithstanding, if a Change in Control occurs and the Executive's employment with the Company had terminated prior to the date on which the Change in Control occurs, and if it is reasonably demonstrated by the Executive that such termination of employment (a) was at the request of a third party who has taken steps reasonably calculated to effect a Change in Control, or (b) otherwise arose in connection with or in anticipation of a Change in Control, then for all purposes of this Agreement, the "Effective Date" shall mean the date immediately prior to the date of such termination of employment.

2.13      "Employment Period" means the period commencing on the Effective Date and ending on the third anniversary of such date.

2.14      "Excise Taxes" See Section 6.1(a).

2.15      "Gross-up Payment" See Section 6.1(a).

2.16      "Performance Period" See Section 3.2(b).

2.17      "Plans" See Section 3.2(c).

2.18      "Potential Parachute Payments" See Section 6.1(a).

2.19      "Severance Incentive" means the greater of (i) the target annual incentive under an Incentive Plan applicable to the Executive for the Performance Period in which the Termination Date occurs, or (ii) the highest actual annual incentives paid (or payable, to the extent not previously paid) to the Executive under the Incentive Plan during the three calendar years preceding the calendar year in which the Termination Date occurs. 

2.20      "Termination Date" means the date of termination of the Executive's employment; provided, however, that if the Executive's employment is terminated by reason of Disability, then the Termination Date shall be the Disability Effective Date (as defined in Section 4.1(a)).

2.21      "Welfare Plans" See Section 3.2(d).

ARTICLE III

TERMS OF EMPLOYMENT
3.1       Position and Duties. 
(a)  The Company hereby agrees to continue the Executive in its employ during the Employment Period and, subject to Article IV of this Agreement, the Executive agrees to remain in the employ of the Company subject to the terms and conditions hereof. 

(b)  During the Employment Period, the Executive (i) will devote his or her or her knowledge, skill and best efforts on a full-time basis to performing his or her or her duties and obligations to the Company (with the exception of absences on account of illness or vacation in accordance with the Company's policies and civic and charitable commitments not involving a conflict with the Company's business), and (ii) will comply with the directions and orders of the Board of Directors, the Chief Executive Officer or other superior officer of the Company with respect to the performance of his or her duties. 

3.2     Compensation. 

(a)Base Salary. During the Employment Period, the Executive shall receive an annual base salary ("Annual Base Salary"), which shall be paid at a monthly rate at least equal to twelve times the highest monthly base salary paid or payable, including any base salary which has been earned but deferred, to the Executive by the Company in respect of the twelve-month period immediately preceding the month in which the Effective Date occurs. During the Employment Period, the Annual Base Salary shall be reviewed no more than 12 months after the last salary increase awarded to the Executive prior to the Effective Date and, thereafter, at least annually, and shall be increased at any time and from time to time as shall be substantially consistent with increases in base salary awarded to other peer executives of the Company. Annual Base Salary shall not be reduced after any such increase unless such reduction is part of a policy, program or arrangement applicable to peer executives of the Company and of any successor entity, and the term Annual Base Salary as used in this Agreement shall refer to Annual Base Salary as so adjusted.

(b)Annual Bonus. In addition to Annual Base Salary, the Company shall make or cause to be made to the Executive an incentive award (the "Annual Bonus") for each Performance Period which ends during the Employment Period. "Performance Period" means each period of time designated in accordance with any annual incentive award arrangement ("Bonus Plan") which is based upon performance. The Executive's target and maximum Annual Bonus with respect to any Performance Period shall not be less than the largest target and maximum annual incentive award payable with respect to the Executive under the Company's annual incentive program as in effect at any time in the three-year period immediately preceding the Effective Date. 

(c)Incentive, Savings and Retirement Plans. During the Employment Period, the Executive shall be entitled to participate in all incentive, savings and retirement plans, practices, policies and programs ("Plans") applicable generally to other peer executives of the Company, but in no event shall such Plans provide the Executive with incentives or savings and retirement benefits which, in each case, are less favorable, in the aggregate than the greater of (i) those provided by the Company for the Executive under such Plans as in effect at any time during the 90-day period immediately preceding the Effective Date, or (ii) those provided generally at any time after the Effective Date to other peer executives of the Company. The Plans shall include both tax-qualified retirement plans and nonqualified retirement plans.

(d)Welfare Benefit Plans. During the Employment Period, the Executive and/or the Executive's family, as the case may be, shall be eligible for participation in and shall receive all benefits under welfare benefit plans, practices, policies and programs ("Welfare Plans") provided by the Company (including, without limitation, medical, prescription, dental, disability, salary continuance, employee life, group life, accidental death and travel accident insurance benefits), but in no event shall such Welfare Plans provide the Executive with benefits which are less favorable, in the aggregate than the greater of (i) those provided by the Company for the Executive under such Welfare Plans as were in effect at any time during the 90-day period immediately preceding the Effective Date, or (ii) those provided generally at any time after the Effective Date to other peer executives of the Company.

(e)Other Employee Benefits. During the Employment Period, the Executive shall be entitled to other employee benefits and perquisites in accordance with the most favorable plans, practices, programs and policies of the Company, as in effect with respect to the Executive at any time during the 90-day period immediately preceding the Effective Date, or if more favorable, as in effect generally with respect to other peer executives of the Company. These other employee benefits and perquisites include, but are not limited to, vacation, use of a company car, parking benefits and financial planning.

(f)Stock Incentives. At the Effective Date, the Executive shall become fully vested in any and all stock incentive awards granted to the Executive under the Dominion Resources, Inc. Incentive Compensation Plan or any other plan or arrangement ("Incentive Plans") which have not become exercisable as the Effective Date. All forfeiture conditions that as of the Effective Date are applicable to any deferred stock unit, restricted stock or restricted share units awarded to the Executive by the Company pursuant to any Incentive Plan or otherwise shall lapse immediately at the Effective Date.

(g)Subsidiaries. To the extent that immediately prior to the Effective Date, the Executive has been on the payroll of, and participated in the incentive or employee benefit plans of, a subsidiary of DRI, the references to the Company contained in Sections 3.2(a) through 3.2(f) and the other Sections of this Agreement referring to benefits to which the Executive may be entitled shall be read to refer to such subsidiary.

ARTICLE IV

TERMINATION OF EMPLOYMENT

4.1  Disability. During the Agreement Term, the Company may terminate the Executive's employment upon the Executive's Disability. The Executive's employment shall terminate effective on the 30th day (the "Disability Effective Date") after the Executive's receipt of written notice of termination from the Company unless, before the Disability Effective Date, the Executive shall have resumed the full-time performance of the Executive's duties. "Disability" means a condition, resulting from bodily injury or disease, that renders, and for a six consecutive month period has rendered, the Executive unable to perform substantially the duties pertaining to his or her employment with the Company. A return to work of less than 14 consecutive days will not be considered an interruption in the Executive's six consecutive months of disability. Disability will be determined by the Company on the basis of medical evidence satisfactory to the Company.

4.2  Death. The Executive's employment shall terminate automatically upon the Executive's death during the Agreement.

Term.

4.3  Cause. The Company may terminate the Executive's employment during the Employment Period for Cause. For purposes       

of this Agreement, "Cause" means (a) fraud or material misappropriation with respect to the business or assets of the Company,

(b) persistent refusal or willful failure of the Executive to perform substantially his or her duties and responsibilities to the Company, which continues after the Executive receives notice of such refusal or failure, (c) conviction of a felony or crime involving moral turpitude, or (d) the use of drugs or alcohol that interferes materially with the Executive's performance  of his or her duties.

4.4  Constructive Termination. The Executive may terminate the Executive's employment for Constructive Termination at any time during the Employment Period. "Constructive Termination" means any material breach of this Agreement by the Company during the Employment Period, including:

(a)the failure to maintain the Executive in the office or position, or in a substantially equivalent office or position, held by the Executive immediately prior to the Effective Date;

(b)a material adverse alteration in the nature or scope of the Executive's position, duties, functions, responsibilities or authority as compared to the nature or scope immediately prior to the Effective Date;

(c)a reduction of the Executive's Annual Base Salary in violation of Section 3.2(a) or a reduction in the Executive's Annual Bonus in violation of Section 3.2(b);

(d)a failure by the Company to provide the Executive with increase in Annual Base Salary or participation in Bonus Plans or Incentive Plans comparable to peer executives of the Company;

(e)the failure of any successor to the Company to assume this Agreement; 

(f)a relocation of more than 50 miles of (i) the Executive's workplace, or (ii) the principal offices of the Company (if such offices are the Executive's workplace), in each case without the consent of the Executive; or

(g)any failure by the Company to comply with Section 3.2(f).

An act or omission shall not constitute Constructive Termination unless (1) the Executive gives written notice to the Company indicating that the Executive intends to terminate employment under this Section 4.4; (2) the Executive's voluntary termination occurs within 60 days after the Executive knows or reasonably should know of an event described in subsection (a)-(g) above, or within 60 days after the last in a series of such events, and (3) the Company has failed to remedy the event described in subsection (a)-(g) above as the case may be, within 30 days after receiving the Executive's written notice. If the Company remedies the event described in subsection (a)-(g), as the case may be, within 30 days after receiving the Executive's written notice, the Executive may not terminate employment under this Section 4.4 on account of the event specified in the Executive's notice.

ARTICLE V

OBLIGATIONS OF THE COMPANY UPON TERMINATION

5.1If by the Executive for Constructive Termination or by the Company Other Than for Cause or Disability. If, during the Employment Period, the Company shall terminate the Executive's employment other than for Cause or Disability, or if the Executive shall terminate employment for Constructive Termination, the Company's obligations to the Executive shall be as follows: 

(a)The Company shall, within thirty business days of such termination of employment, pay the Executive a cash payment equal to the sum of the following amounts:
(i)to the extent not previously paid, the Annual Base Salary and any accrued paid time off through the Termination Date;

(ii)an amount equal to the product of (i) the Annual Bonus (as defined in Section 3.2(b)) for the Performance Period in which the Termination Date occurs multiplied by (ii) a fraction, the numerator of which is the number of days actually worked during such Performance Period, and the denominator of which is 365; or, if greater, the amount of any Annual Incentive paid or payable to the Executive with respect to the Performance Period for the year in which the Termination Date occurs; and 

(iii)all amounts previously deferred by the Executive under any nonqualified deferred compensation plan sponsored by the Company, together with any accrued earnings thereon, and not yet paid by the Company.

(b)The Company shall, within thirty business days of such termination of employment, pay the Executive a cash payment equal to three (3) times the sum of the Executive's Annual Base Salary and the Severance Incentive.

(c)On the Termination Date, the Executive shall become fully vested in any and all stock incentive awards granted to the Executive under any Plan which have not become exercisable as of the Termination Date and all stock options (including options vested as of the Termination Date) shall remain exercisable until the applicable option expiration date. All forfeiture conditions that as of the Termination Date are applicable to any deferred stock unit, restricted stock or restricted share units awarded to the Executive by the Company pursuant to the LTIP, a successor plan or otherwise shall lapse immediately. 

(d)Except as provided in subsections (e) and (f), during the Employment Period (or until such later date as any Welfare Plan of the Company may specify), the Company shall continue to provide to the Executive and the Executive's family welfare benefits (including, without limitation, disability, individual life and group life insurance benefits, but excluding medical or other health plans) which are at least as favorable as those provided under the most favorable Welfare Plans of the Company applicable (i) with respect to the Executive and his or her family during the 90-day period immediately preceding the Termination Date, or (ii) with respect to other peer executives and their families during the Employment Period. In determining benefits under such Welfare Plans, the Executive's annual compensation attributable to base salary and incentives for any plan year or calendar year, as applicable, shall be deemed to be not less than the Executive's Annual Base Salary and Annual Incentive. The cost of the welfare benefits provided under this Section 5.1(d) shall not exceed the cost of such benefits to the Executive immediately before the Termination Date or, if less, the Effective Date. Notwithstanding the foregoing, if the Executive obtains comparable coverage under any Welfare Plans sponsored by another employer, then the amount of coverage required to be provided by the Company hereunder shall be reduced by the amount of coverage provided by such other employer's Welfare Plans. 

(e)If the Executive elects to convert any group term life insurance to an individual policy, the Company shall pay all premiums for 12 months and the Executive shall cease to participate in the Company's group term life insurance.

(f)The Executive's eligibility for any retiree medical coverage shall be determined under the relevant plan, with additional age or service credited provided in the Executive's employment agreement, if any. The Executive's rights under this Section shall be in addition to and not in lieu of any post-termination continuation coverage or conversion rights the Executive may have pursuant to applicable law, including, without limitation, continuation coverage required by Section 4980B of the Code ("COBRA Continuation Coverage"). If the Executive is not eligible for retiree medical coverage and elects to receive COBRA Continuation Coverage, the Company shall pay all of the required premiums for the Executive and/or the Executive's family for 12 months after the Termination Date. For purposes of determining eligibility for and the time of commencement of retiree benefits under any Welfare Plans of the Company, the Executive's credited service shall be the Executive's credited service at the Termination Date plus five years and the Executive's age shall be deemed to be the Executive's age at the Termination Date plus five years. If the Executive is eligible for additional credited service or deemed age under an employment agreement or other contract with the Company, the additional service and age provided by this Section 5.1(f) shall be in addition to any service and/or age credit provided under an employment agreement or contract.

(g)The Executive shall be fully vested in the Company's Executive Supplemental Retirement Plan and Benefit Restoration Plan or any successor or replacement plans (the "Supplemental Plans"). For purposes of the Supplemental Plans, the Executive's credited service shall be the Executive's credited service at the Termination Date plus five years and the Executive's age shall be deemed to be the Executive's age at the Termination Date plus five years. The amount payable under Section 5.1(b) of this Agreement shall be taken into account for purposes of determining the amount of benefits to which the Executive is entitled under the Supplemental Plans as though the amount was earned equally over the Employment Period. If the Executive is eligible for additional credited service or deemed age under an employment agreement or other contract with the Company, the additional service and age provided by this Section 5.1(g) shall be in addition to any service and/or age credit provided under an employment agreement or contract. 

            (h)  The Company shall, at its sole expense, as incurred, pay on behalf of Executive up to $25,000 in fees and costs charged by nationally recognized outplacement firm selected by the Executive to provide outplacement service for one year after the Termination Date.

            (i)  For the period stated below, the Company shall continue to pay all premiums on the Executive's whole life insurance policy (the "Policy") issued under the Executive Life Insurance Program. The payments under Section 5.1(i) are in lieu of any payments under Section 5.1(d) with respect to the Policy. The premium payments shall be made until the earlier of:

(i) the fifth anniversary of the Termination Date, or 

(ii) the later to occur of the tenth anniversary of the Policy or the Executive reaching age 64.

5.2If by the Company for Cause. If the Company terminates the Executive's employment for Cause during the Employment Period, this Agreement shall terminate without further obligation by the Company to the Executive, other than the obligation immediately to pay the Executive in cash the Executive's Annual Base Salary through the Termination Date, plus any accrued paid time off, in each case to the extent not previously paid.

5.3If by the Executive Other Than for Constructive Termination. If the Executive terminates employment during the Employment Period other than for Constructive Termination, Disability or death, this Agreement shall terminate without further obligation by the Company, other than the obligation immediately to pay the Executive in cash the Executive's Annual Base Salary through the Termination Date, plus any accrued paid time off, in each case to the extent not previously paid.

5.4If by the Company for Disability. If the Company terminates the Executive's employment by reason of the Executive's Disability during the Employment Period, this Agreement shall terminate without further obligation to the Executive, other than:

(a)the Company shall pay the Executive in cash all amounts specified in Sections 5.1(a)(i), (ii), (iii) and 5(b), in each case, to the extent unpaid as of the Termination Date (such amounts collectively, the "Accrued Obligations"),

(b)the Executive shall be fully vested in the Company's Supplemental Plans and shall be entitled to immediate payment of any benefits under the Supplemental Plans; and

(c)the Executive's right after the Disability Effective Date to receive disability and other benefits at least equal to the greater of (1) those provided under the most favorable disability Plans applicable to disabled peer executives of the Company in effect immediately before the Termination Date, or (2) those provided under the most favorable disability Plans of the Company in effect at any time during the 90-day period immediately before the Effective Date.

5.5If upon Death. If the Executive's employment is terminated by reason of the Executive's death during the Employment Period, this Agreement shall terminate without further obligation to the Executive's legal representatives under this Agreement, other than the obligation immediately to pay the Executive's estate or beneficiary in cash all Accrued Obligations (as defined in Section 5.4(a)) and to provide the benefits as stated in Section 5.4(b). In addition, the Executive's family shall be entitled to receive death benefits at least equal to the most favorable death benefits provided under Plans and Welfare Plans of the Company to the surviving families of peer executives of the Company, but in no event shall such Plans and Welfare Plans provide benefits which in each case are less favorable, in the aggregate, than the most favorable of those provided by the Company to the Executive under such Plans in effect at any time during the 90-day period immediately before the Effective Date.

ARTICLE VI

CERTAIN ADDITIONAL PAYMENTS BY THE COMPANY

6.1      Gross-up for Certain Taxes. 

(a)If the Company determines that any benefit received or deemed received by the Executive from the Company pursuant to this Agreement or otherwise, whether or not in connection with a Change in Control (such monetary or other benefits collectively, the "Potential Parachute Payments") is or will become subject to any excise tax under Section 4999 of the Code or any similar tax payable under any United States federal, state, local or other law (such excise tax and all such similar taxes collectively, "Excise Taxes"), then the Company shall, within 30 business days after such determination, pay the Executive an amount (the "Gross-up Payment") equal to the product of:
(i)the amount of such Excise Taxes multiplied by

(ii)the Gross-up Multiple (as defined in Section 6.3).

The Gross-up Payment is intended to compensate the Executive for all Excise Taxes payable by the Executive with respect to the Potential Parachute Payments and any federal, state, local or other income or other taxes or Excise Taxes payable by the Executive with respect to the Gross-up Payment.

(b)The determination of the Company described in Section 6.1(a), including the detailed calculations of the amounts of the Potential Parachute Payments, Excise Taxes and Gross-Up Payment and the assumptions relating thereto, shall be set forth in a written certificate of the Company's independent auditors (the "Company Certificate") delivered to the Executive. The Executive may at any time request the preparation and delivery to the Executive of a Company Certificate. The Company shall cause the Company Certificate to be delivered to the Executive as soon as reasonably possible after such request.

6.2Additional Gross-up Amounts. If for any reason it is later determined pursuant to a final judgment of a court of competent jurisdiction or a determination by the Company that the amount of Excise Taxes payable by the Executive is greater than the amount determined by the Company pursuant to Section 6.1, then the Company shall pay the Executive an amount (which shall also be deemed a Gross-up Payment) equal to the product of: 

(a)the sum of (i) such additional Excise Taxes and (ii) any interest, fines, penalties, expenses or other costs incurred by the Executive as a result of having taken a position in accordance with a determination made pursuant to Section 6.1 multiplied by
(b)the Gross-up Multiple.

6.3Gross-up Multiple. The Gross-up Multiple shall equal a fraction, the numerator of which is one (1.0), and the denominator of which is one (1.0) minus the sum, expressed as a decimal fraction, of the effective after-tax marginal rates of all federal, state, local and other income and other taxes and any Excise Taxes applicable to the Gross-up Payment. If different rates of tax are applicable to various portions of a Gross-up Payment, the weighted average of such rates shall be used.

6.4Amount Increased or Contested. 

(a)The Executive shall notify the Company in writing (an "Executive's Notice") of any claim by the IRS or other taxing authority (an "IRS Claim") that, if successful, would require the payment by the Executive of Excise Taxes in respect of Potential Parachute Payments in an amount in excess of the amount of such Excise Taxes determined in accordance with Section 6.1. Such Executive's Notice shall include a copy of all notices and other documents or correspondence received by the Executive in respect of such IRS Claim. The Executive shall give the Executive's Notice as soon as practicable. If before the deadline for a response to the IRS ("IRS Claim Deadline"), the Company shall:
(i) deliver to the Executive a Company Certificate to the effect that the IRS Claim has been reviewed by the Company and, notwithstanding the IRS Claim, the amount of Excise Taxes, interest and penalties payable by the Executive is either zero or an amount less than the amount specified in the IRS Claim,

(ii)pay to the Executive an amount (which shall also be deemed a Gross-Up Payment) equal to the positive difference between (A) the product of the amount of Excise Taxes, interest and penalties specified in the Company Certificate, if any, multiplied by the Gross-Up Multiple, and (B) the portion of such product, if any, previously paid to Executive by the Company, and

            (iii)direct the Executive pursuant to Section 6.4(d) to contest the balance of the IRS Claim, 

then the Executive shall pay only the amount, if any, of Excise Taxes, interest and penalties specified in the Company Certificate. In no event shall the Executive pay an IRS Claim earlier than 30 days after having given an Executive's Notice to the Company (or, if sooner, the IRS Claim Deadline).

(b)At any time after the payment by the Executive of any amount of Excise Taxes or related interest or penalties in respect of Potential Parachute Payments, the Company may in its discretion require the Executive to pursue a claim for a refund (a "Refund Claim") of all or any portion of such Excise Taxes, interest or penalties as the Company may specify by written notice to the Executive.

(c)If the Company notifies the Executive in writing that the Company desires the Executive to contest an IRS Claim or to pursue a Refund Claim, the Executive shall:
(i)give the Company all information that it reasonably requests in writing from time to time relating to such IRS Claim or Refund Claim, as applicable,

(ii)take such action in connection with such IRS Claim or Refund Claim (as applicable) as the Company reasonably requests in writing from time to time, including accepting legal representation with respect thereto by an attorney selected by the Company, subject to the approval of the Executive (which approval shall not be unreasonably withheld or delayed),

(iii)cooperate with the Company in good faith to contest such IRS Claim or pursue such Refund Claim, as applicable,

(iv)permit the Company to participate in any proceedings relating to such IRS Claim or Refund Claim, as applicable, and

(v)contest such IRS Claim or prosecute such Refund Claim (as applicable) to a determination before any administrative tribunal, in a court of initial jurisdiction and in one or more appellate courts, as the Company may from time to time determine in its discretion.

The Company shall control all proceedings in connection with such IRS Claim or Refund Claim (as applicable) and in its discretion may cause the Executive to pursue or forego any and all administrative appeals, proceedings, hearings and conferences with the IRS or other taxing authority in respect of such IRS Claim or Refund Claim (as applicable); provided that (i) any extension of the statute of limitations relating to payment of taxes for the taxable year of the Executive relating to the IRS Claim is limited solely to such IRS Claim, (ii) the Company's control of the IRS Claim or Refund Claim (as applicable) shall be limited to issues with respect to which a Gross-Up Payment would be payable, and (iii) the Executive shall be entitled to settle or contest, as the case may be, any other issue raised by the IRS or other taxing authority.

(d)The Company may at any time in its discretion direct the Executive to (i) contest the IRS Claim in any lawful manner or (ii) pay the amount specified in an IRS Claim and pursue a Refund Claim; provided, however, that if the Company directs the Executive to pay an IRS Claim and pursue a Refund Claim, the Company shall advance the amount of such payment to the Executive on an interest-free basis and shall indemnify the Executive, on an after-tax basis, for any income or other applicable taxes or Excise Tax, and any related interest or penalties imposed with respect to such advance.

(e)The Company shall pay directly all legal, accounting and other costs and expenses (including additional interest and penalties) incurred by the Company or the Executive in connection with any IRS Claim or Refund Claim, as applicable, and shall indemnify the Executive, on an after-tax basis, for any income or other applicable taxes, Excise Tax and related interest and penalties imposed on the Executive as a result of such payment of costs and expenses.

6.5Refunds. If, after the receipt by the Executive of any payment or advance of Excise Taxes advanced by the Company pursuant to Section 6.4, the Executive receives any refund with respect to such claim, the Executive shall (subject to the Company's complying with the requirements of Section 6.4) promptly pay the Company the amount of such refund (together with any interest paid or credited thereon after taxes applicable thereto). If, after the receipt by the Executive of an amount advanced by the Company pursuant to Section 6.4, a determination is made that the Executive shall not be entitled to any refund with respect to such claim and the Company does not notify the Executive in writing of its intent to contest such determination within 30 days after the Company receives written notice of such determination, then such advance shall be forgiven and shall not be required to be repaid and the amount of such advance shall offset, to the extent thereof, the amount of Gross-up Payment required to be paid. Any contest of a denial of refund shall be controlled by Section 6.4.

ARTICLE VII 

EXPENSES AND INTEREST

7.1Legal Fees and Other Expenses. The Company will pay all reasonable fees and expenses, if any, (including, without limitation, legal fees and expenses) that are incurred by the Executive to enforce this Agreement and that result from a breach of this Agreement by the Company.

7.2Interest. If the Company does not pay any amount due to the Executive under this Agreement within three days after such amount became due and owing, interest shall accrue on such amount from the date it became due and owing until the date of payment at a annual rate equal to 200 basis points above the base commercial lending rate published in The Wall Street Journal in effect from time to time during the period of such nonpayment.

ARTICLE VIII

NO ADVERSE EFFECT ON POOLING OF INTERESTS

Any benefits provided to the Executive under this Agreement may be reduced or eliminated to the extent necessary, in the reasonable judgment of the Board, to enable the Company to account for a merger, consolidation or similar transaction as a pooling of interests; provided that (i) the Board shall have exercised such judgment and given the Executive written notice thereof prior to the Effective Date and (ii) the determination of the Board shall be supported by a written certificate of the Company's independent auditors, a copy of which shall be provided to the Executive before the Effective Date.

ARTICLE IX

NO SET-OFF OR MITIGATION

9.1No Set-off by Company. The Executive's right to receive when due the payments and other benefits provided for under this Agreement is absolute, unconditional and subject to no set-off, counterclaim or legal or equitable defense. Any claim which the Company may have against the Executive, whether for a breach of this Agreement or otherwise, shall be brought in a separate action or proceeding and not as part of any action or proceeding brought by the Executive to enforce any rights against the Company under this Agreement.

9.2No Mitigation. The Executive shall not have any duty to mitigate the amounts payable by the Company under this Agreement by seeking new employment following termination. Except as specifically otherwise provided in this Agreement, all amounts payable pursuant to this Agreement shall be paid without reduction regardless of any amounts of salary, compensation or other amounts which may be paid or payable to the Executive as the result of the Executive's employment by another employer.

ARTICLE X

NON-EXCLUSIVITY OF RIGHTS

10.1Waiver of Other Severance Rights. To the extent that payments are made to the Executive pursuant to Section 5.1 of this Agreement, the Executive hereby waives the right to receive benefits under any plan or agreement (including an offer of employment or employment contract) of the Company or its subsidiaries which provides for severance benefits (except as provided in Section 5.1(b).

10.2Other Rights. Except as provided in Section 10.1, this Agreement shall not prevent or limit the Executive's continuing or future participation in any benefit, bonus, incentive or other plans provided by the Company or any of its subsidiaries and for which the Executive may qualify, nor shall this Agreement limit or otherwise affect such rights as the Executive may have under any other agreements with the Company or any of its subsidiaries. Amounts which are vested benefits or which the Executive is otherwise entitled to receive under any plan of the Company or any of its subsidiaries and any other payment or benefit required by law at or after the Termination Date shall be payable in accordance with such Plan or applicable law except as expressly modified by this Agreement.

 

ARTICLE XI

MISCELLANEOUS

11.1No Assignment. The Executive's rights under this Agreement may not be assigned or transferred in whole or in part, except that the personal representative of the Executive's estate will receive any amounts payable under this Agreement after the death of the Executive. This Agreement shall inure to the benefit of and be enforceable by the Executive's legal representatives.

11.2Successors. The rights and obligations of the Company under this Agreement will inure to the benefit of and will be binding upon the successors and assigns of the Company. Before or upon a Change in Control, the Company shall obtain the agreement of the surviving or acquiring corporation that it will succeed to the Company's rights and obligations under this Agreement.

11.3Rights Under the Agreement. The right to receive benefits under the Agreement will not give the Executive any proprietary in1erest in the Company or any of its assets. Benefits under the Agreement will be payable from the general assets of the Company, and there will be no required funding of amounts that may become payable under the Agreement. The Executive will for all purposes be a general creditor of the Company. The interest of the Executive under the Agreement cannot be assigned, anticipated, sold, encumbered or pledged and will not be subject to the claims of the Executive's creditors. 

11.4Notice. For purposes of this Agreement, notices and all other communications must be in writing and are effective when delivered or mailed by United States registered mail, return receipt requested, postage prepaid, addressed to the Executive or his or her personal representative at his or her last known address. All notices to the Company must be directed to the attention of the Corporate Secretary with a copy to the General Counsel. Such other addresses may be used as either party may have furnished to the other in writing. Notices of change of address are effective only upon receipt. 

11.5Miscellaneous. The Executive and the Company agree that, effective as of the execution of this Agreement, any prior Employment Continuity Agreement between the Executive and the Company is null and void. This instrument contains the entire agreement of the parties. To the extent not governed by federal law, this Agreement will be construed in accordance with the laws of the Commonwealth of Virginia, without reference to its conflict of laws rules. No provisions of this Agreement may be modified, waived or discharged unless such waiver, modification or discharge is agreed to in writing and the writing is signed by the Executive and the Company. A waiver of any breach of or compliance with any provision or condition of this Agreement is not a waiver of similar or dissimilar provisions or conditions. The invalidity or unenforceability of any provision of this Agreement will not affect the validity or enforceability of any other provision of this Agreement, which will remain in full force and effect. This Agreement may be executed in one or more counterparts, all of which will be considered one and the same agreement.

11.6Tax Withholding. The Company may withhold from any amounts payable under this Agreement any federal, state or local taxes that are required to be withheld pursuant to any applicable law or regulation.

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

 

__________________________

Executive

 

DOMINION RESOURCES, INC.

 

By:________________________

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