Document:

DOMINION RESOURCES, INC

Exhibit 10.2 

 

 

 

 

 

 

 

DOMINION RESOURCES, INC.

EXECUTIVES' DEFERRED COMPENSATION PLAN

 

 

 

 

 

 

 

 

 

 

AMENDED AND RESTATED

Effective

JULY 15, 2003

 

 

 

For the Executives of:

Dominion Resources, Inc.

And Affiliates

 

 

TABLE OF CONTENTS

	
Section
	
                                                         Page

	
1.
	
DEFINITIONS
	
1

	
2.
	
PURPOSE
	
4

	
3.
	
PARTICIPATION
	
4

	
4.
	
DEFERRAL ELECTION
	
5

	
5.
	
EFFECT OF NO ELECTION
	
6

	
6.
	
ROLLOVER ELECTION
	
6

	
7.
	
FORMER CNG PLANS
	
7

	
8.
	
DEFERRED STOCK OPTION BENEFIT
	
7

	
9.
	
MATCH CONTRIBUTIONS
	
8

	
10.
	
INVESTMENT FUNDS
	
9

	
11.
	
DISTRIBUTIONS
	
9

	
12.
	
HARDSHIP DISTRIBUTIONS
	
11

	
13.
	
COMPANY'S OBLIGATION
	
12

	
14.
	
CONTROL BY PARTICIPANT
	
12

	
15.
	
CLAIMS AGAINST PARTICIPANT'S BENEFIT
	
13

	
16.
	
AMENDMENT OR TERMINATION
	
13

	
17.
	
ADMINISTRATION
	
13

	
18.
	
NOTICES
	
14

	
19.
	
WAIVER
	
14

	
20.
	
CONSTRUCITON
	
14

 

 

DOMINION RESOURCES, INC.

EXECUTIVES' DEFERRED COMPENSATION PLAN

1. DEFINITIONS. 
The following definitions apply to this Plan and to any related documents. 
(a)Accounts means, collectively, a Participant's Deferral Account, Match Account, and Deferred Stock Option Account, if any.

(b)Administrator means Dominion Resources Services, Inc.

(c)Beneficiary or Beneficiaries means a person or persons or other entity that a Participant designates on a Beneficiary Designation Form to receive Benefit payments pursuant to Plan Section 11(h). If a Participant does not execute a valid Beneficiary Designation Form, or if the designated Beneficiary or Beneficiaries fail to survive the Participant or otherwise fail to take the Benefit, the Participant's Beneficiary or Beneficiaries shall be the first of the following persons who survive the Participant: a Participant's spouse (the person legally married to the Participant when the Participant dies); the Participant's children in equal shares. If none of these persons survive the Participant, the Beneficiary shall be the Participant's estate.

(d)Beneficiary Designation Form means the form that a Participant uses to name the Participant's Beneficiary or Beneficiaries.

(e)Benefit means collectively, a Participant's Deferred Benefit, Match Benefit, and Deferred Stock Option Benefit, if any. 

(f)Board means the Board of Directors of DRI. 

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

(i) any person, including a ''group'' as defined in Section 13(d)(3) of Securities Exchange Act of 1934, as amended, 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 Board, as long as the majority of the Board approving the purchases is also the majority at the time the purchases are made); 

(ii) 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 Board, or any successor's board, within two years of the last of such transactions; or 

(iii) with respect to a particular Participant, an event occurs with respect to the Participant's employer such that, after the event, the Participant's employer is no longer a Dominion Company. 

      (h)       Code means the Internal Revenue Code of 1986, as amended. 

      (i)        Committee means the Organization, Compensation and Nominating Committee of the Board.

      (j)        Company means DRI and any Dominion Company that is designated by the Administrator as covered by this Plan, and any successor business by merger, purchase, or otherwise that maintains the Plan.

      (k)       Compensation means a Participant's base salary, cash incentive pay and other cash compensation from the Company, including annual bonuses, pre-scheduled one-time performance-based payments, and gains from stock option grants. Compensation does not include stock, stock options or spot awards. The Administrator may determine whether to include or exclude an item of income from Compensation.

       (l)        Deferral means the amount of Compensation that a Participant has elected to defer under a Deferral Election Form. 

       (m)      Deferral Account means a bookkeeping record established for each Participant who is eligible to receive a Deferred Benefit. A Deferral Account shall be established only for purposes of measuring a Deferred Benefit and not to segregate assets or to identify assets that may be used to satisfy a Deferred Benefit. A Deferral Account shall be credited with that amount of a Participant's Compensation deferred according to a Participant's Deferral Election Form. A Deferral Account shall also be credited with the amount of benefits rolled over to the Plan pursuant to a Rollover Election Form. A Deferral Account also shall be credited periodically with deemed investment gain or loss under Plan Section 10. 

       (n)       Deferral Election Form means the form that a Participant uses to elect to defer Compensation pursuant to Plan Section 4.

       (o)       Deferred Benefit means the benefit available to a Participant who has executed a valid Deferral Election Form or Rollover Election Form. 

       (p)       Deferred Stock Option Account means a bookkeeping record established for each Participant who has made an election to defer the DRI Stock to be received under an exercise of a nonstatutory stock option granted under the Dominion Resources, Inc. Incentive Compensation Plan and the Dominion Resources, Inc. Leadership Stock Option Plan. The account shall be charged or credited with net earnings, gains, losses and expenses, as well as any appreciation or depreciation in market value during each Plan Year for the deemed investment in the DRI Stock. The Administrator may charge or credit such earnings, gains, losses, appreciation and depreciation based on the actual investment performance of        the DRI Stock that it has deposited into the trust. 

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       (q)      Deferred Stock Option Benefit means the portion of a Participant's Benefit from the Participant's Deferred Stock Option Account.

       (r)       Disability or Disabled means, with respect to a Participant, that the Participant is entitled to benefits under the long-term disability plan of the Company. 

       (s)      Distribution Election Form means a form that a Participant uses to establish the duration of the deferral of Compensation and the frequency of payments of a Benefit. If a Participant does not execute a valid Distribution Election Form, the distribution of a Benefit shall be governed by Plan Section 5.

       (t)       Dominion Company means Consolidated Natural Gas, Inc., Virginia Power, Dominion Capital, Inc., Dominion Energy, Inc., Dominion Resources Services, Inc., or another corporation in which DRI owns stock possessing at least 50 % of the combined voting power of all classes of stock or which is in a chain of corporations with DRI in which stock possessing at least 50% of the combined voting power of all classes of stock is owned by one or more other corporations in the chain.

      (u)       DRI means Dominion Resources, Inc.

      (v)       DRI Stock means the common stock, no par value, of DRI.

      (w)      DRI Stock Fund means an Investment Fund in which the deemed investment is DRI Stock.

      (x)       DSOP means the Dominion Resources, Inc. Security Option Plan.

      (y)       Election Date means the date by which an Executive must submit a valid Deferral Election Form for regular Compensation. For each Plan Year, the Election Date shall be January 1 unless the Administrator sets an earlier Election Date or as provided in Plan Section 4(b) or 4(c). 

      (z)       Executive means an individual who is employed by the Company and who has a base salary of at least $100,000. 

      (aa)     Investment Fund means one or more deemed investment alternatives offered to Participants from time to time. The Company may compute deemed investment gain or loss under the Investment Funds based on the actual investment performance of assets that it has deposited in a grantor trust (as described in Plan Section 13). The DRI Stock Fund shall be one of the Investment Funds.

      (bb)     Match Account means an Account that holds the matching contributions made by the Company under Plan Section 9.

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      (cc)      Match Benefit means the portion of a Participant's Benefit from the Participant's Match Account.

      (dd)      Participant means an individual presently or formerly employed by the Company who meets one or more of the requirements of Plan Section 3(a).

      (ee)      Plan means the Dominion Resources, Inc. Executives' Deferred Compensation Plan.

      (ff)       Plan Year means a calendar year.

      (gg)     Rollover Election Form means the form that a Participant uses to rollover benefits payable in the form of a lump sum payment from a Supplemental Retirement Plan to this Plan.

      (hh)     Supplemental Retirement Plan means the Dominion Resources, Inc. Retirement Benefit Restoration Plan and/or the Dominion Resources, Inc. Executive Supplemental Retirement Plan.

      (ii)       Terminate or Termination, with respect to a Participant, means the cessation of the Participant's employment with the Company on account of death, Disability, severance or any other reason.

2. PURPOSE. 
The Plan is intended to benefit a "select group of management or highly compensated employees," as that term is used under Title I of the Employee Retirement Income Security Act of 1974, as amended. The Plan is intended to permit Executives to defer their Compensation, and for related purposes.

3. PARTICIPATION. 
(a)An individual presently or formerly employed by the Company is a Participant if he or she is: 
i     With respect to any Plan Year, an Executive who executes a valid Deferral Election Form for that Plan Year as provided in Plan Section 3(b);

ii     An individual who has a Deferred Stock Option Account due to an election to defer DRI Stock;

iii    An individual who is eligible for a Match under Plan Section 9;

iv    An individual who had a benefit entitlement under Section 4.1(b) of the CNG ERISA Excess Plan as of December 31, 2000; or

v     An individual who had a benefit entitlement under Section 5 of the Consolidated Natural Gas Company Executive Incentive Deferral Plan as of December 31, 2000.
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vi   An individual who has executed a Rollover Election Form pursuant to Plan Section 6.

     (b)  An Executive may become a Participant for any Plan Year by filing a valid Deferral Election Form according to Plan Section 4 on or before the Election Date for that Plan Year, or by filing an election to defer DRI Stock pursuant to the Dominion Resources, Inc. Incentive Compensation Plan, the Dominion Resources, Inc. Leadership Stock Option Plan or any other plan designated by the Administrator. 

     (c)  An individual remains a Participant as long as the Participant is entitled to a Benefit under the Plan. An individual who is a Participant under Plan Section 3(a)(iv), (v), or (vi) and who is not an Executive may direct deemed investments pursuant to Plan Section 10 but may not make a Deferral election under Plan Section 4.

4. DEFERRAL ELECTION. 
An Executive may elect on or before the Election Date to defer receipt of a portion of the Executive's Compensation for the Plan Year. Except as provided in Plan Section 4(a), an Executive may elect a deferral for any Plan Year only if he or she is an Executive on the Election Date for that Plan Year. The following provisions apply to deferral elections: 
(a)A Participant may defer up to 50% of the Participant's base salary and up to 85% of the Participant's annual cash incentive award, long-term cash incentive payments and pre-scheduled one-time cash payments. The maximum Deferrals to this Plan shall be reduced by any deferrals that the Participant has elected to defer to the DSOP or any other deferred compensation plan of the Company. Compensation for deferrals under the Dominion Resources, Inc. Employee Savings Plan shall be based on a Participant's Compensation after any Deferrals made under this Plan, the DSOP, or any other deferred compensation plan of the Company. 

(b)A Participant may defer up to 85% of the Participant's gains on stock acquired by exercise of an option under the Dominion Resources, Inc. Incentive Compensation Plan or the Dominion Resources, Inc. Leadership Stock Option Plan. For purposes of deferral of stock option gains, the Election Date shall be the date that is six months before the Participant exercises the option. Procedures for deferring stock option gains shall be established under the Dominion Resources, Inc. Incentive Compensation Plan and the Dominion Resources, Inc. Leadership Stock Option Plan. 

(c)Before each Plan Year's Election Date, each Executive shall be provided with a Deferral Election Form. Except as provided below, a deferral election shall be valid only when the Deferral Election Form is completed, signed by the electing Executive, and received by the Administrator on or before the Election Date for that Plan Year. In the year in which an Executive is first promoted to a salary grade between A through G, the Executive may make a deferral election by completing a Deferral Election Form within 30 days of the promotion. The deferral election will be effective for periods after the Administrator receives it.

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(d)An Executive must complete an Investment Election Form for all amounts in the Executive's Deferral Account. The Compensation deferred under a Deferral Election Form shall be allocated among available Investment Funds in percentages as specified on the investment election form. 

(e)An Executive must complete a Distribution Election Form for the distribution of the Executive's Deferral Account. 

(f)The Administrator may reject any Deferral Election Form or any Distribution Election Form or both that does not conform to the provisions of the Plan. The Administrator may modify any Distribution Election Form at any time to the extent necessary to comply with any federal securities laws or regulations. The Administrator's rejection or modification must be made on a uniform basis with respect to similarly situated Executives. If the Administrator rejects a Deferral Election Form, the Executive shall be paid the amounts the Executive would have been entitled to receive if the Executive had not submitted the rejected Deferral Election Form.

(g)An Executive may not revoke a Deferral Election Form after the Plan Year begins, except that an Executive may revoke a Deferral Election Form within 30 days following a Change of Control. Any revocation before the beginning of the Plan Year or within 30 days following a Change of Control has the same effect as a failure to submit a Deferral Election Form. Any writing signed by an Executive expressing an intention to revoke the Executive's Deferral Election Form and delivered to the Administrator before the close of business on the relevant Election Date shall be a revocation. 

(h)Subject to the distribution restrictions of Plan Section 11, an Executive may revoke an existing Distribution Election Form at any time by submitting a new Distribution Election Form. 

            5. EFFECT OF NO ELECTION. 
Except as provided in Plan Section 4(c), an Executive who has not submitted a valid Deferral Election Form to the Administrator on or before the relevant Election Date may not defer any part of the Executive's Compensation for the Plan Year to this Plan. The Deferred Benefit of an Executive who submits a valid Deferral Election Form but fails to submit a valid Distribution Election Form (either as to the form or commencement of payment) before the relevant Election Date shall be distributed in a lump sum on or before the February 28 following the calendar year of the Executive's Termination.

6. ROLLOVER ELECTION. A Participant in a Supplemental Retirement Plan who elects to receive a single lump sum payment of benefits under the Supplemental Retirement Plan may also elect to rollover the calculated rollover amount to this Plan by executing a Rollover Election Form. The provisions of Section 4(d), (e), (f), and (h) apply to Benefits subject to a Rollover Election Form. 

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            7. FORMER CNG PLANS. 

                       (a) The Plan has assumed a portion of the obligations and liabilities of the Unfunded Supplemental Benefit Plan for Employees of Consolidated Natural Gas Company and its             Participating Subsidiaries Who are Not Represented by a Recognized Union ("CNG ERISA Excess Plan") with respect to Participants in the Plan. The portion assumed by the Plan is the             liabilities related to "Matching Contributions" under the "Thrift Plan" (as those terms are defined in the CNG ERISA Excess Plan) and related gains and losses as of December 31, 2000. A             Participant's Benefit as of January 1, 2001 shall include the Participant's account under the CNG ERISA Excess Plan as of December 31, 2000. The payment of a Participant's Benefit             from this Plan shall be in complete satisfaction of the Participant's benefits under Section 4.1.(b) of the CNG ERISA Excess Plan. A Participant's Investment Election Form, Distribution             Election Form and Beneficiary Election Form shall apply to the portion of the Participant's Benefit from the CNG ERISA Excess Plan. 

                      (b) The Plan has assumed all of the obligations and liabilities of the Consolidated Natural Gas Company Executive Incentive Deferral Plan ("CNG Deferral Plan") with respect to             Participants in the Plan. The liabilities assumed by the Plan are the liabilities of the CNG Deferral Plan as of December 31, 2000 equal to the sum of all Participants' balances as of            December 31, 2000 in the CNG Deferral Plan. The Participant's balance in the CNG Deferral Plan shall be part of the Participant's Benefit as of January 1, 2001. A Participant's Benefit as            of January 1, 2001 shall include the Participant's account under the CNG Deferral Plan as of December 31, 2000. The payment of a Participant's Benefit from this Plan shall be in complete            satisfaction of the Participant's benefits under Section 5 of the CNG Deferral Plan. A Participant's Investment Election Form, Distribution Election Form and Beneficiary Election Form            shall apply to the portion of the Participant's Benefit from the CNG Deferral Plan.

            8. DEFERRED STOCK OPTION BENEFIT. 
A Participant's Deferred Stock Option Benefit shall remain deemed invested in DRI Stock until distribution. Such Participant's Distribution Election Form and Beneficiary Election Form shall apply to the Participant's Deferred Stock Option Benefit. If the Company has delivered shares of DRI Stock to a trust to satisfy the Deferred Stock Option Benefit, payment of the Deferred Stock Option Benefit shall be tracked as stock and made in shares of DRI Stock from the trust. If the Company has not delivered shares of DRI Stock to a trust, the Company shall make payment of the Deferred Stock Option Benefit in DRI Stock through the Dominion Resources, Inc. Incentive Compensation Plan and the Dominion Resources, Inc. Leadership Stock Option Plan.

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 9. MATCH CONTRIBUTIONS. 
(a)With respect to each Plan Year, the Company shall credit a Match (as defined below) to the Match Account of each eligible Participant, unless the Company has elected to contribute the Match to the DSOP, or another deferred compensation plan of the Company. To be eligible for a Match, a Participant must meet all of the following criteria:
i     be employed on December 31 or have Terminated during the Plan Year due to retirement or early retirement (as defined by the Dominion Savings Plan), death or Disability;

ii    have made salary deferrals to the Dominion Savings Plan for the Plan Year; and

iii    have base salary for the Plan Year in excess of the dollar limit for the Plan Year under Code section 401(a)(17).

(b)The amount of the Match will be determined under the following formula: Excess Compensation times Deferral Percentage times Match Percentage. The terms in the formula have the following meanings.
i     Excess Compensation is the amount of the Participant's base salary for the Plan Year in excess of the dollar limit for the Plan Year under Code section 401(a)(17).

ii    Deferral Percentage is the total of the Participant's salary deferrals to the Dominion Savings Plan for the Plan Year divided by the lesser of (i) the dollar limit for the Plan Year under Code section 401(a)(17), or (ii) the Participant's base salary for the Plan Year reduced by deferrals under this Plan and the Dominion Savings Plan. The Deferral Percentage may not exceed the maximum percentage of compensation on which the Participant would be eligible to receive a match by making a deferral under the Dominion Savings Plan for the Plan Year. 

iii   Match Percentage is the percentage of company match made with respect to the Participant's salary deferral to the Dominion Savings Plan.

     (c)  A Participant's Match Account shall be 100% vested. 

     (d)  A Participant will not be required to invest any portion of the Match Account in the DRI Stock Fund. The Administrator may establish further procedures for the administration of the Match Account.

 

                       10. INVESTMENT FUNDS

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(a)Each Participant shall have the right to direct the deemed investment of the Participant's Deferral Account and the Match Account among the Investment Funds. The Administrator shall determine the number and type of Investment Funds that will be available for investment in any Plan Year. At its sole discretion, the Administrator may change the number and type of Investment Funds at any time and may establish procedures for the transition between Investment Funds.

(b)Deferrals shall be credited to an Investment Fund as of the date on which the deferred Compensation would have been paid to the Participant. A separate bookkeeping account shall be established for each Participant who has directed a deemed investment in an Investment Fund. Deemed transfers between Investment Funds in the Participant's Deferral Account and Match Account shall be charged and credited as the case may be to each Investment Fund account. The Investment Fund account shall be charged or credited with net earnings, gains, losses and expenses, as well as any appreciation or depreciation in market value during each Plan Year for the deemed investment in the Investment Fund. The Administrator may charge or credit such earnings, gains, losses, appreciation and depreciation based on the actual investment performance of assets that it has deposited in a grantor trust (as described in Plan Section 13).

(c)Pursuant to procedures established by the Administrator uniformly applied, Participants may direct the transfer of deemed investments among Investment Funds at least once in each Plan Year. The transfer of deemed investments involving the DRI Stock Fund may be subject to such restrictions, including prior approval, as determined appropriate by DRI.

                  11. DISTRIBUTIONS.
(a)  "All Benefits, less withholding for applicable income and employment taxes, shall be paid in cash by the Company or its designee, except that  payment from a Participant's Deferred Stock Option Account shall be made in the form of DRI Stock and the Committee may provide that a designated payment from the DRI Stock Fund shall be made in the form of DRI Stock under payment procedures similar to Section 8." A Participant may elect to receive a distribution of all or a portion of the Participant's Benefits subject to the provisions of this Section. Payment of each distribution of Benefits shall be made in one lump sum or in installments as provided in this Section. Except in the event of Termination for reasons other than death, retirement or Disability, or as provided in Plan Section 11(f), a Participant may receive a distribution from the Participant's Deferral Account only on a date that is at least six months after the date on which the Participant's most recent Deferral Election Form is effective. 
(i) Unless otherwise provided herein or specified in a Participant's Distribution Election Form, any lump sum payment shall be paid, or installment payments shall begin, on or before February 28 of the calendar year after the Participant's Termination. The Participant may elect on the Participant's Distribution Election Form to begin payments (A) on or before the February 28 of the calendar year following the calendar year of the Participant's Termination; (B) on or before the February 28 of the calendar year following the calendar year of the Participant's Termination but no sooner than February 28 of a specified calendar year; or (C) even if the Participant does not Terminate, on or before the February 28 of a specified calendar year.

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(ii) Installment payments will be made in such amount and at such times as specified in the Participant's Distribution Election Form, provided however, no such payments shall exceed a period of ten (10) years. Benefits will not be paid more often than once a year, except as provided in Plan Section 11(a)(iii). For a Benefit payable in a form other than a lump sum, the unpaid balance of a Participant's Deferral Account and Match Account, if any, shall continue to be maintained in Investment Funds. The unpaid balance of a Participant's Deferred Stock Option Account shall remain invested in DRI Stock. All Benefits must be paid no later than February 28 of the 10th calendar year after the year in which the Participant's retirement or Disability occurs.

(iii)If a Participant has commenced distribution of benefits in a form other than a lump sum, the Participant may make a one-time election to receive any unpaid Benefits in the form of a single lump sum payment or to modify the remaining payment schedule to any form permitted under Plan Section 11(a)(ii). The election may be made at any time prior to the full payment of the Participant's Benefits. The election is subject to the Committee's approval, in its absolute discretion, and the election will be effective no less than 30 days after notice is provided to the Administrator. The Committee, in its discretion, may delegate its authority to approve the one-time election to the Administrative Benefits Committee. 

(b) Benefits paid on account of Termination for retirement shall be paid in a lump sum unless the Participant's Distribution Election Form specifies annual installment payments over a period of up to ten (10) years. 

(c) Benefits paid on account of a Participant's death shall be paid in a lump sum in accordance with the provisions of Plan Section 11(h).

(d) Benefits paid on account of Termination due to Disability shall begin to be paid as soon as administratively practicable following the Participant's Termination. The Benefits shall be paid in the method designated on the Participant's Distribution Election Form, or in annual installment payments over a period of ten (10) years if the Participant made no election on the Participant's Distribution Election Form. If a Disabled Participant begins to receive Benefits and thereafter recovers and returns to employment before the balance of the Participant's Accounts is fully paid, distributions shall cease and any remaining Benefits under the Plan shall be governed by this Plan Section 11 and the Participant's Distribution Election Form.

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(e) Benefits paid on account of Termination due to other than death, Disability or retirement shall be paid in a lump sum as soon as practicable following the Termination.

(f) A Participant may elect to receive payment of Benefits prior to Termination. If payment is made pursuant to a Distribution Election Form that was effective less than six months before the date of such payment, the Participant's Deferred Benefit shall be reduced by 10%. Such payment shall be paid in a lump sum. 

      (g)  Notwithstanding any other provision of this Plan or a Participant's Distribution Election Form, the Committee in its sole discretion may postpone the distribution of all or part of        a Benefit to the extent that the payment would not be deductible under Section 162(m) of the Internal Revenue Code of 1986, as amended (the Code) or any successor thereto. A        Benefit distribution that is postponed pursuant to the preceding sentence shall be paid as soon as it is possible to do so within the deduction limitations of Section 162(m) of the        Code. 
(h)  A Participant or Beneficiary may not assign Benefits. A Participant may use only one Beneficiary Designation Form to designate one or more Beneficiaries for all of the Participant's Benefits under the Plan. Such designations are revocable. Each Beneficiary shall receive the Beneficiary's portion of the Participant's Accounts on or before February 28 of the year following the Participant's death. However, the Administrator, in its discretion, may approve a Beneficiary's request for accelerated payment under Plan Section 12. The Administrator may require that multiple Beneficiaries agree upon a single distribution method.

                 12. HARDSHIP DISTRIBUTIONS.
(a)At its sole discretion and at the request of a Participant before or after the Participant's Termination, or at the request of any of the Participant's Beneficiaries after the Participant's death, the Administrator may accelerate and pay all or part of any amount attributable to a Participant's Benefits. The Administrator may accelerate distributions only in the event of Hardship as defined in Plan Section 12(b). An accelerated distribution under this Section shall be limited to the amount necessary to satisfy the Hardship.

(b)Hardship is a severe financial hardship to the Participant resulting from a sudden and unexpected illness or accident of the Participant or of a dependent of the Participant, loss of the Participant's property due to casualty, or other similar extraordinary and unforeseeable circumstances arising as a result of events beyond the control of the Participant. The circumstances that will constitute a Hardship will depend upon the facts of each case, but, in any case, payment will not be made to the extent that the Hardship is or may be relieved: (i) through reimbursement or compensation by insurance or otherwise, (ii) by liquidation of the Participant's assets, to the extent that the liquidation of such assets would not itself cause severe financial hardship, or (iii) by cessation of deferrals under the Plan. 

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(c)Distributions under this Plan Section 12 shall be made in one lump sum payment in cash except that in the case of a Participant's Deferred Stock Option Benefit, distributions shall be made in DRI Stock. Distributions shall be made proportionately from all of the Investment Funds in the Participant's Accounts first, and, with respect to Deferred Benefits, shall be limited to amounts attributable to Compensation deferred under a Deferral Election Form that was effective at least six months before the distribution. The Investment Funds in the Participant's Accounts shall be valued as of the last business day prior to the distribution, or as of such other date as may be determined in the discretion of the Administrator.

(d)A distribution under this Plan Section 12 shall be in lieu of that portion of a Participant's Benefit that would have been paid otherwise. A Benefit shall be adjusted by reducing the balance of the Participant's Accounts by the amount of the distribution. 

            13. COMPANY'S OBLIGATION. 
            (a)The Plan shall be unfunded. DRI shall not be required to segregate any assets that at any time may represent a Benefit. DRI shall establish a grantor trust (within the             meaning of Sections 671 through 679 of the Code) for Participants and Beneficiaries and shall deposit Participants' Match Benefits with the trustee of such trust. DRI may deposit             funds with the trustee of such trust to provide the Deferred Benefits or Deferred Stock Option Benefits to which Participants and Beneficiaries may be entitled under the Plan. The             funds deposited with the trustee or trustees of such trust, and the earnings thereon, will be dedicated to the payment of Benefits under the Plan but shall remain subject to the             claims of the general creditors of the Company. Any liability of DRI to a Participant or Beneficiary under this Plan shall be based solely on any contractual obligations that may be             created pursuant to this Plan. No such obligation of DRI shall be deemed to be secured by any pledge of, or other encumbrance on, any property of DRI.

           (b)Notwithstanding the foregoing, in the event of a Change of Control, DRI shall, immediately prior to a Change of Control, make an irrevocable contribution to the trust so            that the amount held in trust is equal to 105% of the amount that is sufficient to pay each Participant or Beneficiary the Benefit to which they would be entitled, and for which DRI            and each other Dominion Company is liable, pursuant to the terms of the Plan as in effect on the date on which the Change of Control occurred. The amount of such contribution            exceeding the amount required to pay Benefits under the Plan shall be used to pay administrative costs of the trust and reimburse any Participant who incurs legal fees as a result of            an attempt to enforce the terms of the Plan against an acquirer of DRI. Additionally, the trustee of the trust as of the date of the Change of Control may not be removed as trustee            of the trust before the fifth anniversary of the date of the Change of Control.

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           14. CONTROL BY PARTICIPANT. 
A Participant shall have no control over the Participant's Benefit except according to the Participant's Deferral Election Forms, Rollover Election Forms, Distribution Election Forms, Investment Election Form and Beneficiary Designation Form.

           15. CLAIMS AGAINST PARTICIPANT'S BENEFIT. 
An Account shall not be subject in any manner to anticipation, alienation, sale, transfer, assignment, pledge, encumbrance, or charge, and any attempt to do so shall be void. A Benefit shall not be subject to attachment or legal process for a Participant's debts or other obligations. Nothing contained in this Plan shall give any Participant any interest, lien, or claim against any specific asset of the Company. A Participant or the Participant's Beneficiary shall have no rights other than as a general creditor of DRI.

           16. AMENDMENT OR TERMINATION. 
Except as otherwise provided, this Plan may be altered, amended, suspended, or terminated at any time by the Committee. The Committee may not alter, amend, suspend, or terminate this Plan without the consent of that Participant if such action would result in (i) a distribution of the Participant's Benefit in any manner not provided in the Plan or (ii) immediate taxation of a Benefit to a Participant. 

           17. ADMINISTRATION. 
(a)This Plan shall be administered by the Administrator. The Administrator shall interpret the Plan, establish regulations to further the purposes of the Plan and take any other action necessary to the proper operation of the Plan. To the extent authorized by the Administrator, any action required to be taken by a Participant may be taken in writing, by electronic transmission, by telephone, or by facsimile, except for a beneficiary designation which must be in writing. Prior to paying a Benefit under the Plan, the Administrator may require the Participant, former Participant or Beneficiary to provide such information or material as the Administrator, in its sole discretion, shall deem necessary to make any determination it may be required to make under the Plan. The Administrator may withhold payment of a Benefit under the Plan until it receives all such information and material and is reasonably satisfied of its correctness and genuineness. The Administrator may delegate all or any of its responsibilities and powers to any persons selected by it, including designated officers of employees of the Company.

(b)If for any reason a Benefit payable under this Plan is not paid when due, the Participant or Beneficiary may file a written claim with a committee appointed by the Administrator to review claims for benefits under the Plan (the "Claims Committee"). If the claim is denied or no response is received within forty-five (45) days after the date on which the claim was filed with the Claims Committee (in which case the claim will be to have been denied), the Participant or 

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Beneficiary may appeal the denial to the Committee within sixty (60) days of receipt of written notification of the denial or the end of the forty-five day period, whichever occurs first. In pursuing an appeal, the Participant or Beneficiary may request that the Committee review the denial, may review pertinent documents, and may submit issues and documents in writing to the Committee. A decision on appeal will be made within sixty (60) days after the appeal is made, unless special circumstances require the Committee to extend the period for another sixty (60) days.

            18. NOTICES. 
All notices or election required under the Plan must be in writing. A notice or election shall be deemed delivered if it is delivered personally or sent registered or certified mail to the person at the person's last known business address.

           19. WAIVER. 
The waiver of a breach of any provision in this Plan does not operate as and may not be construed as a waiver of any later breach.

           20. CONSTRUCTION. 
This Plan shall be adopted and maintained according to the laws of the Commonwealth of Virginia (except its choice-of-law rules and except to the extent that such laws are preempted by applicable federal law). Headings and captions are only for convenience; they do not have substantive meaning. If a provision of this Plan is not valid or enforceable, the validity or enforceability of any other provision shall not be affected. Use of one gender includes all, and the singular and plural include each other.

           IN WITNESS WHEREOF, this instrument has been executed this 7th day of August 2003.

	
DOMINION RESOURCES, INC.

	
 

	
By /s/ Anne M. Grier                          

      Anne M. Grier

      Vice President - Human Resources

	
 

-14-exhibit101

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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