-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, MsRYYzYE5u3IhTfMKvC8k7piehiGreL4grrR6FD9LdCjn+jDi7zapjnE4dQE6TbT NZbLwM3Va6zH/lZBMlmmAA== 0001021408-02-003753.txt : 20020415 0001021408-02-003753.hdr.sgml : 20020415 ACCESSION NUMBER: 0001021408-02-003753 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 8 CONFORMED PERIOD OF REPORT: 20020313 ITEM INFORMATION: Other events ITEM INFORMATION: Financial statements and exhibits FILED AS OF DATE: 20020318 FILER: COMPANY DATA: COMPANY CONFORMED NAME: DOMINION RESOURCES INC /VA/ CENTRAL INDEX KEY: 0000715957 STANDARD INDUSTRIAL CLASSIFICATION: ELECTRIC SERVICES [4911] IRS NUMBER: 541229715 STATE OF INCORPORATION: VA FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 8-K SEC ACT: 1934 Act SEC FILE NUMBER: 001-08489 FILM NUMBER: 02578054 BUSINESS ADDRESS: STREET 1: 120 TREDEGAR STREET STREET 2: P O BOX 26532 CITY: RICHMOND STATE: VA ZIP: 23219 BUSINESS PHONE: 8048192000 MAIL ADDRESS: STREET 1: P O BOX 26532 STREET 2: 120 TREDEGAR STREET CITY: RICHMOND STATE: VA ZIP: 23219 8-K 1 d8k.txt FORM 8-K SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 8-K CURRENT REPORT Pursuant to section 13 or 15(d) of The Securities Exchange Act of 1934 Date of Report: March 13, 2002 (Date of earliest event reported) Dominion Resources, Inc. (Exact name of registrant as specified in its charter) Virginia 001-08489 54-1229715 (State or other jurisdiction (Commission (I.R.S. Employer of incorporation or organization) File Number) Identification No.)
120 Tredegar Street Richmond, Virginia 23219-3932 (804) 819-2000 (Address including zip code, and telephone number, including area code, of registrant's principal executive offices) (Former name or former address, if changed since last report.) ITEM 5. OTHER EVENTS On March 13, 2002, Dominion Resources, Inc. (the Company) entered into a purchase agreement (the Purchase Agreement) with Salomon Smith Barney Inc. in connection with the issuance of 6,000,000 Upper DECS Equity Income Securities (Equity Income Securities) consisting of Corporate Units where each Corporate Unit consists of a stock purchase contract and the Company's 2002 Series A 5.75% Senior Note due May 15, 2008 (Senior Notes). The Equity Income Securities are a portion of the $2.0 billion aggregate principal amount of securities that were registered by the Company pursuant to a registration statement on Form S-3 under Rule 415 pursuant to the Securities Act of 1933, as amended, which registration statement was declared effective on March 2, 2001 (File No. 333-55904). A copy of the Purchase Agreement including exhibits thereto, is filed as Exhibit 1 to this Form 8-K. The designation of, and the terms and conditions applicable to the Senior Notes, which are a component of the Equity Income Securities, were established as set forth in the Tenth Supplemental Indenture to the Company's Senior Indenture dated as of June 1, 2000, as supplemented, and have been approved by the Board of Directors of the Company. A copy of the form of Tenth Supplemental Indenture including exhibits thereto, is filed as Exhibit 4.2 to this Form 8-K. The rights of the holders of the Purchase Contracts are governed by the Purchase Contract Agreement between the Company and JPMorgan Chase Bank, as Purchase Contract Agent. A copy of the form of Purchase Contract Agreement including exhibits thereto, is filed as Exhibit 4.3 and a form of the Certificate evidencing Corporate Units and a form of the Certificate evidencing Treasury Units are Exhibits A and B, respectively, to the Purchase Contract Agreement. The beneficial owners' obligations under the Purchase Contracts are secured by a Pledge Agreement between the Company, Bank One Trust Company, N.A., as Collateral Agent and Securities Intermediary, and JPMorgan Chase Bank, as Purchase Contract Agent. A copy of the form of Pledge Agreement including exhibits thereto is filed as Exhibit 4.4 to this Form 8-K. The Senior Notes will be remarketed initially on February 15, 2006 by Salomon Smith Barney Inc. The terms and conditions applicable to the remarketing of the Senior Notes are governed by a Remarketing Agreement. A copy of the form of Remarketing Agreement including exhibits thereto is filed as Exhibit 4.5 to this Form 8-K. ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS Exhibits 1 Purchase Agreement, dated March 13, 2002, between the Company and Salomon Smith Barney Inc. (filed herewith). 4.1 Form of Senior Indenture, dated as of June 1, 2000, between the Company and JPMorgan Chase Bank (formerly known as The Chase Manhattan Bank), as Trustee (incorporated by reference to Exhibit 4(iii) to the Company's Registration Statement on Form S-3 (Registration No. 333-93187). 4.2 Form of Tenth Supplemental Indenture to the Senior Indenture pursuant to which the Senior Notes will be issued. The form of the Senior Notes is included as Exhibit A to the form of Tenth Supplemental Indenture (filed herewith). 4.3 Form of Purchase Contract Agreement between the Company and JPMorgan Chase Bank, as Purchase Contract Agent, pursuant to which the Purchase Contracts will be issued. The forms of Certificate evidencing Corporate Units and Certificate evidencing Treasury Units are filed as Exhibits A and B, respectively, to the form of Purchase Contract Agreement (filed herewith). 4.4 Form of Pledge Agreement between the Company, Bank One Trust Company, N.A., as Collateral Agent and Securities Intermediary, and JPMorgan Chase Bank, as Purchase Contract Agent (filed herewith). 4.5 Form of Remarketing Agreement, between the Company and Salomon Smith Barney Inc. (filed herewith). 8 Tax opinion of McGuireWoods LLP (filed herewith). 12 Computation of Ratio of Earnings to Fixed Charges (filed herewith). 23 Consent of McGuireWoods LLP is included in the tax opinion filed as Exhibit 8. SIGNATURE Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized. DOMINION RESOURCES, INC. Registrant /s/ James P. Carney Name: James P. Carney Title: Assistant Treasurer Date: March 18, 2002 INDEX TO EXHIBITS 1 Purchase Agreement, dated March 13, 2002 between the Company and Salomon Smith Barney Inc. (filed herewith). 4.1 Form of Senior Indenture, dated as of June 1, 2000, between the Company and JPMorgan Chase Bank (formerly known as The Chase Manhattan Bank), as Trustee (incorporated by reference to Exhibit 4(iii) to the Company's Registration Statement on Form S-3 (Registration No. 333-93187). 4.2 Form of Tenth Supplemental Indenture to the Senior Indenture pursuant to which the Senior Notes will be issued. The form of note for the Senior Notes is included as Exhibit A to the form of Tenth Supplemental Indenture (filed herewith). 4.3 Form of Purchase Contract Agreement between the Company and JPMorgan Chase Bank, as Purchase Contract Agent, pursuant to which the Purchase Contracts will be issued. The forms of Certificate evidencing Corporate Units and Certificate evidencing Treasury Units are filed as Exhibits A and B respectively to the form of Purchase Contract Agreement (filed herewith). 4.4 Form of Pledge Agreement between the Company, Bank One Trust Company, N.A., as Collateral Agent and Securities Intermediary, and JPMorgan Chase Bank, as Purchase Contract Agent (filed herewith). 4.5 Form of Remarketing Agreement, between the Company and Salomon Smith Barney Inc. (filed herewith). 8 Tax opinion of McGuireWoods LLP (filed herewith). 12 Computation of Ratio of Earnings to Fixed Charges (filed herewith). 23 Consent of McGuireWoods LLP is included in the tax opinion filed as Exhibit 8. EX-1 3 dex1.txt PURCHASE AGREEMENT Exhibit 1 DOMINION RESOURCES, INC. 6,000,000 EQUITY INCOME SECURITIES CONSISTING OF 6,000,000 CORPORATE UNITS PURCHASE AGREEMENT March 13, 2002 Salomon Smith Barney Inc. 388 Greenwich Street - 34/th/ Floor New York, NY 10013 Ladies and Gentlemen: Dominion Resources Inc., a Virginia corporation (Dominion), confirms its agreement with you, with respect to the issue and sale by Dominion and purchase by you of 6,000,000 Equity Income Securities (the Firm Equity Income Securities). In addition, Dominion proposes to grant you an option to purchase up to an additional 600,000 Equity Income Securities on the terms and for the purposes set forth in Section 4 (the Option Equity Income Securities). The Firm Equity Income Securities and the Option Equity Income Securities, if purchased, are hereinafter collectively called the "Equity Income Securities." This agreement shall be referred to herein as the "Purchase Agreement". Capitalized terms used herein without definition shall be used as defined in the Prospectus (as hereinafter defined). 1. Intentionally omitted. 2. Description of the Equity Income Securities. Each Equity Income ------------------------------------------- Security will initially consist of a unit (a Corporate Unit) comprised of (a) a stock purchase contract (a Purchase Contract, and collectively the Purchase Contracts), to be issued under a Purchase Contract Agreement (the Purchase Contract Agreement) between Dominion and JPMorgan Chase Bank, as the Purchase Contract Agent (the Purchase Contract Agent), under which (i) the holder will purchase from Dominion no later than May 15, 2006, for a price of $50, a number of shares of common stock, without par value, of Dominion (the Common Stock), equal to the Settlement Rate as set forth in the Purchase Contract Agreement and (ii) Dominion will pay to the holder contract adjustment payments and (b) a 2002 Series A 5.75 % Senior Note, due May 15, 2008 of Dominion, in the principal amount of $50 (a Senior Note, and collectively, the Senior Notes). The holders of the Equity Income Securities will pledge the Senior Notes to Bank One Trust Company, N.A., as Collateral Agent (the Collateral Agent), pursuant to a Pledge Agreement, to be entered into among Dominion, the Purchase Contract Agent, the Securities Intermediary and the Collateral Agent (the Pledge Agreement), to secure the holders' obligations to purchase Common Stock under the -1- Purchase Contracts. Under certain circumstances, holders of Corporate Units may substitute certain U.S. Treasury securities for the Senior Notes that are part of such holders' Corporate Units and thereby create Treasury Units (the Treasury Units) pursuant to the terms of the Purchase Contract Agreement and the Pledge Agreement. The Senior Notes will be issued under Dominion's Senior Indenture dated as of June 1, 2000, between Dominion and JPMorgan Chase Bank (formerly known as The Chase Manhattan Bank), as Trustee (the Trustee), as supplemented, and as further supplemented by a Tenth Supplemental Indenture dated as of March 1, 2002 (collectively, the Indenture). 3. Representations and Warranties of Dominion. Dominion represents and ------------------------------------------ warrants to you and agrees with you that: (a) A registration statement, No. 333-55904 on Form S-3 for the registration of the Equity Income Securities under the Securities Act of 1933, as amended (the Securities Act), heretofore filed with the Securities and Exchange Commission (the Commission), a copy of which as so filed has been delivered to you, has become effective. The registration statement, including all exhibits thereto, as amended through the date hereof, is hereinafter referred to as the "Registration Statement"; the prospectus relating to the stock purchase units and other securities included in the Registration Statement, which prospectus is now proposed to be supplemented by a prospectus supplement relating to the Equity Income Securities to be filed with the Commission under the Securities Act, as completed and as so supplemented, is hereinafter referred to as the "Prospectus". As used herein, the terms "Registration Statement" and "Prospectus" include all documents (including any Current Report on Form 8-K) incorporated therein by reference, and shall include any documents (including any Current Report on Form 8-K) filed after the date of such Registration Statement, prospectus or Prospectus and incorporated therein by reference from the date of filing of such incorporated documents (collectively, the Incorporated Documents). (b) No order suspending the effectiveness of the Registration Statement or otherwise preventing or suspending the use of the Prospectus has been issued by the Commission and is in effect and no proceedings for that purpose are pending before or, to the knowledge of Dominion, threatened by the Commission. The Registration Statement and the Prospectus comply in all material respects with the provisions of the Securities Act, the Securities Exchange Act of 1934, as amended (the Securities Exchange Act), the Trust Indenture Act of 1939, as amended (the Trust Indenture Act), and the rules, regulations and releases of the Commission thereunder (the Rules and Regulations) and, neither the Registration Statement on the date it was declared effective (the Effective Date) nor the Prospectus on the date hereof contained or contains an untrue statement of a material fact or omitted or omits to state a material fact required to be stated therein or necessary to make the statements therein not misleading, and, on the Closing Date (as defined below), the Registration Statement and the Prospectus (including any amendments and supplements -2- thereto) will conform in all respects to the requirements of the Securities Act, the Trust Indenture Act and the Rules and Regulations, and neither of such documents will include any untrue statement of a material fact or omit to state any material fact required to be stated therein or necessary to make the statements therein not misleading; provided, that the foregoing representations and warranties in this Section 3(b) shall not apply to statements in or omissions from the Registration Statement or the Prospectus made in reliance upon information furnished herein or in writing to Dominion by you or on your behalf for use in the Registration Statement or Prospectus or the part of the Registration Statement which constitutes the Trustee's Statement of Eligibility under the Trust Indenture Act; and provided, further, that the foregoing representations and warranties are given on the basis that any statement contained in an Incorporated Document shall be deemed not to be contained in the Registration Statement or Prospectus if the statement has been modified or superseded by any statement in a subsequently filed Incorporated Document or in the Registration Statement or Prospectus or in any amendment or supplement thereto. (c) Except as reflected in, or contemplated by, the Registration Statement and Prospectus (exclusive of any amendments or supplements after the date hereof), since the respective most recent dates as of which information is given in the Registration Statement and Prospectus (exclusive of any amendments or supplements after the date hereof), there has not been any material adverse change or event which would result in a material adverse effect on the condition of the Company and its subsidiaries taken as a whole, financial or otherwise (a Material Adverse Effect). Dominion and its subsidiaries taken as a whole have no material contingent financial obligation which is not disclosed in the Registration Statement and the Prospectus. (d) Deloitte & Touche LLP, who have certified certain of Dominion's financial statements filed with the Commission and incorporated by reference in the Registration Statement, are independent public accountants as required by the Securities Act and the Rules and Regulations. (e) Consolidated Natural Gas Company, Dominion Exploration & Production, Inc., Dominion Energy, Inc., Dominion Nuclear Connecticut, Inc., Dominion Nuclear, Inc., Dominion Nuclear Marketing II, Inc., Dominion Transmission, Inc, The East Ohio Gas Company and Virginia Electric and Power Company are the only Significant Subsidiaries of Dominion as such term is defined in Rule 1-02 of Regulation S-X. All of the issued and outstanding capital stock of each Significant Subsidiary has been duly authorized and validly issued, is fully paid and nonassessable, and, with the exception of the outstanding preferred stock of Virginia Electric and Power Company which is owned by third parties, the capital stock of each Significant Subsidiary is owned by Dominion, directly or through subsidiaries, free and clear of any security interest, mortgage, pledge, lien, claim, encumbrance or equitable right. -3- (f) The execution, delivery and performance of this Purchase Agreement, the Indenture, the Corporate Units, the Purchase Contract Agreement, the Senior Notes, the Pledge Agreement, and the Remarketing Agreement, and the consummation of the transactions contemplated in this Purchase Agreement, the Indenture, the Corporate Units, the Purchase Contract Agreement, the Senior Notes, the Pledge Agreement, and the Remarketing Agreement, and in the Registration Statement (including the issuance and sale of the Equity Income Securities and the use of the proceeds from the sale of the Equity Income Securities as described in the Prospectus under the caption USE OF PROCEEDS) and compliance by Dominion with its obligations under this Purchase Agreement, the Indenture, the Corporate Units, the Purchase Contract Agreement, the Senior Notes, the Pledge Agreement and the Remarketing Agreement, do not and will not, whether with or without the giving of notice or lapse of time or both, conflict with or constitute a breach of, or default under or result in the creation or imposition of any lien, charge or encumbrance upon any property or assets of Dominion or any subsidiary pursuant to any contract, indenture, mortgage, deed of trust, loan or credit agreement, note, lease or any other agreement or instrument, to which Dominion or any subsidiary is a party or by which it or any of them may be bound, or to which any of the property or assets of Dominion or any subsidiary is subject (except for such conflicts, breaches or defaults or liens, charges or encumbrances that would not have a Material Adverse Effect), nor will such action result in any violation of the provisions of the charter or bylaws of Dominion or any subsidiary, or any applicable law, statute, rule, regulation, judgment, order, writ or decree of any government, government instrumentality or court, domestic or foreign, having jurisdiction over Dominion or any subsidiary or any of their respective properties, assets or operations, and Dominion has full power and authority to authorize, issue and sell the Corporate Units, the Senior Notes and the Common Stock as contemplated by this Purchase Agreement. (g) The Corporate Units have been duly authorized by Dominion, and when duly executed by Dominion (assuming due execution by the Purchase Contract Agent as attorney-in-fact for the holders thereof and due authentication by the Purchase Contract Agent) and delivered by Dominion and upon payment therefor as set forth herein, will be duly and validly issued and outstanding, and will constitute valid and binding obligations of Dominion entitled to the benefits of the Purchase Contract Agreement and enforceable against Dominion in accordance with their terms, except as enforcement thereof may be limited by bankruptcy, insolvency, reorganization, moratorium or other similar laws affecting the enforcement of creditors' rights generally or by general equitable principles (regardless of whether enforcement is considered in a proceeding in equity or at law). (h) The unissued shares of Common Stock to be issued and sold by Dominion pursuant to the Purchase Contracts have been duly and validly authorized and reserved for issuance and, when issued and delivered in accordance with the provisions of the Purchase Contracts, will be duly and validly issued, fully paid and non-assessable, and the issuance of such shares will not be subject to any preemptive or similar rights. -4- (i) Dominion is not, and, after giving effect to the offering and sale of the Equity Income Securities and the application of the proceeds thereof as described in the Prospectus, will not be, an "investment company" or a company "controlled" by an "investment company" which is required to be registered under the Investment Company Act of 1940, as amended. 4. Offering. On the basis of the representations and warranties herein -------- contained, but subject to the terms and conditions in this Purchase Agreement set forth, Dominion agrees to sell to you, and you agree to purchase from Dominion, at the price, place and time specified, the total number of the Firm Equity Income Securities set forth in Schedule I hereto. In addition, Dominion hereby grants to you an option to purchase up to 600,000 Option Equity Income Securities. Such option is granted solely for the purpose of covering over-allotments in the sale of the Firm Equity Income Securities and is exercisable as provided herein. The price of both the Firm Equity Income Securities and the Option Equity Income Securities shall be $50 per Equity Income Security. Dominion shall not be obligated to deliver any of the Equity Income Securities to be delivered on the First Closing Date (as hereinafter defined) or the Second Closing Date (as hereinafter defined), as the case may be, except upon payment for all the Equity Income Securities to be purchased on such Closing Date as provided herein. 5. Time and Place of Closing. Delivery of the Equity Income Securities ------------------------- to, and payment therefor by, you shall be made at the time, place and date specified in Schedule I or such other time, place and date as you and Dominion may agree upon in writing. The hour and date of such delivery and payment are herein called the "First Closing Date", or the "Closing Date" as the context implies. On the First Closing Date, Dominion, through the facilities of The Depository Trust Company ("DTC"), shall deliver or cause to be delivered a securities entitlement with respect to the Firm Equity Income Securities to you against payment of the purchase price by wire transfer of same-day funds to a bank account designated by Dominion. Time shall be of the essence, and delivery at the time and place specified pursuant to this Purchase Agreement is a further condition of your obligation hereunder. Upon delivery, the Firm Equity Income Securities shall be registered in the name of Cede & Co., as nominee for DTC. At any time on or before the thirtieth day after the date of this Purchase Agreement, the option granted in Section 4 may be exercised by your written notice being given to Dominion. Such notice shall set forth the aggregate number of Option Equity Income Securities as to which the option is being exercised, the denominations in which the Option Equity Income Securities are to be issued and the date and time, as determined by you, when the Option Equity Income Securities are to be delivered; provided, however, that this date and time shall not be earlier than the First Closing Date nor earlier than the second business day after the date on which the option shall have been exercised nor later than the fifth business day after the date on which the option shall have been exercised. The date and time the Option Equity Income Securities are delivered are sometimes referred to as the "Second Closing Date" and the First Closing Date and the Second Closing Date are sometimes each referred to as a "Closing Date". -5- Delivery of and payment for the Option Equity Income Securities shall be made at the place specified pursuant to the first sentence of the first paragraph of this Section 5 (or at such other place as shall be determined by agreement between you and Dominion) at 10:00 A.M., Richmond, Virginia time, on the Second Closing Date. On the Second Closing Date, Dominion, through the facilities of DTC, shall deliver or cause to be delivered a securities entitlement with respect to the Option Equity Income Securities to you for your account against payment of the purchase price by wire transfer of same-day funds to a bank account designated by Dominion. Time shall be of the essence, and delivery at the time and place specified pursuant to this Purchase Agreement is a further condition of your obligation hereunder. Upon delivery, the Option Shares shall be registered in the name of Cede & Co., as nominee of DTC. 6. Covenants of Dominion. Dominion agrees that: --------------------- (a) If you so request, Dominion, on or prior to the Closing Date, will deliver to you conformed copies of the Registration Statement as originally filed, including all exhibits, any related preliminary prospectus supplement, the Prospectus and all amendments and supplements to each such document, in each case as soon as available and in such quantities as are reasonably requested by you. You will be deemed to have made such a request for copies for yourself and Troutman Sanders Mays & Valentine LLP, your counsel, with respect to any such documents that are not electronically available through the Commission's EDGAR filing system. (b) Dominion will pay all expenses in connection with (i) the preparation and filing by it of the Registration Statement and the Prospectus, (ii) the preparation, issuance, listing and delivery of the Equity Income Securities, (iii) any fees and expenses of the Trustee, the Purchase Contract Agent, the Securities Intermediary and the Collateral Agent and (iv) the printing and delivery to you, in reasonable quantities, of copies of the Registration Statement and the Prospectus (each as originally filed and as subsequently amended). In addition, Dominion will pay the reasonable out of pocket fees and disbursements of your counsel, Troutman Sanders Mays & Valentine LLP, in connection with the qualification of the Equity Income Securities under state securities or blue sky laws or investment laws (if and to the extent such qualification is required by you or Dominion). (c) If, during the time when a prospectus relating to the Equity Income Securities is required to be delivered under the Securities Act, any event occurs as a result of which the Prospectus as then amended or supplemented would include an untrue statement of a material fact or omit to state any material fact necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading, or if it is necessary at any time to amend the Prospectus to comply with the Act, Dominion promptly will (i) notify you to suspend solicitation of purchases of the Equity Income Securities and (ii) at its expense, prepare and file with the Commission an amendment or supplement -6- which will correct such statement or omission or an amendment which will effect such compliance. During the period specified above, Dominion will continue to prepare and file with the Commission on a timely basis all documents or amendments required under the Securities Exchange Act and the applicable rules and regulations of the Commission thereunder; provided, that Dominion shall not file such documents or amendments without also furnishing copies thereof to you and Troutman Sanders Mays & Valentine LLP. Any such documents or amendments which are electronically available through the Commission's EDGAR filing system shall be deemed to have been furnished by Dominion to you and Troutman Sanders Mays & Valentine LLP. (d) Dominion will advise you promptly of any proposal to amend or supplement the Registration Statement or the Prospectus and will afford you a reasonable opportunity to comment on any such proposed amendment or supplement prior to filing; and Dominion will also advise you promptly of the filing of any such amendment or supplement and of the institution by the Commission of any stop order proceedings in respect of the Registration Statement or of any part thereof and will use its best efforts to prevent the issuance of any such stop order and to obtain as soon as possible its lifting, if issued. (e) Dominion will make generally available to its security holders, as soon as it is practicable to do so, an earnings statement of Dominion (which need not be audited) in reasonable detail, covering a period of at least 12 months beginning within three months after the effective date of the Registration Statement, which earnings statement shall satisfy the requirements of Section 11(a) of the Securities Act. (f) Dominion will furnish such proper information as may be lawfully required and otherwise cooperate in qualifying the Equity Income Securities for offer and sale under the securities or blue sky laws of such jurisdictions as you may designate; provided, however, that Dominion shall not be required in any state to qualify as a foreign corporation, or to file a general consent to service of process, or to submit to any requirements which it deems unduly burdensome. (g) Fees and disbursements of Troutman Sanders Mays & Valentine LLP who are acting as counsel for you (exclusive of fees and disbursements of such counsel which are to be paid as set forth in Section 6(b)), shall be paid by you; provided, however, that if this Purchase Agreement is terminated in accordance with the provisions of Sections 7 or 8 hereof, Dominion shall reimburse you for the amount of such fees and disbursements. (h) Dominion shall not, and it shall prior to closing obtain from its executive officers (as such term is defined in Rule 3b-7 promulgated under the Securities Exchange Act) (the Executive Officers) and its directors their agreement not to (i) directly or indirectly, offer, pledge, sell, contract to sell, sell any option or contract to purchase, purchase any option or contract to sell, grant any option, right or warrant to purchase or otherwise transfer or dispose of any Equity Income Securities, Common Stock or -7- Purchase Contracts, as the case may be, or any securities of Dominion similar to the Equity Income Securities, or any security convertible into or exercisable or exchangeable for Equity Income Securities, Common Stock or Purchase Contracts or any securities of Dominion similar to the Equity Income Securities, or file any Registration Statement under the Securities Act with respect to any of the foregoing (other than a shelf registration statement from which no such securities are offered) or (ii) enter into any swap or any other agreement or any transaction that transfers, in whole or in part, directly or indirectly, the economic consequence of ownership of the Equity Income Securities, Common Stock, Purchase Contracts or any securities of Dominion similar to the Equity Income Securities or, any such securities convertible into or exercisable or exchangeable for such securities, whether any such swap or transaction described in clause (i) or (ii) above is to be settled by delivery of Equity Income Securities, Common Stock, Purchase Contracts or such other securities, in cash or otherwise, for a period of 90 days from the date hereof without your prior written consent other than (A) pursuant to this Purchase Agreement; (B) Dominion's Treasury PIES or Units or Corporate PIES or Units to be created or recreated upon substitution of pledged securities or shares of Common Stock issuable upon early settlement of Dominion's Corporate PIES or Units or Treasury PIES or Units; (C) any shares of Common Stock issued by Dominion upon exercise of an option, warrant, or the conversion of a security outstanding on the date hereof; (D) any shares of Common Stock issued, or options to purchase such shares granted (or the sale by any of Dominion's Executive Officers or directors of Common Stock received as dividends) in connection with any employee benefit plans, employee stock purchase plans, non-employee director stock plans, dividend reinvestment plans, employee retirement plans and the Dominion Direct Investment plan; (E) the sale or surrender to Dominion by any of its Executive Officers or directors of any options or Common Stock underlying options in order to pay the exercise price or taxes associated with the exercise of options; (F) any issuance by Dominion of Common Stock in connection with acquisitions that close more than 90 days after the date hereof or any acquisition in which the party or parties receiving the Common Stock agree to be bound by the restrictions of this Section 6(h); (G) transactions by any person other than Dominion relating to Common Stock or other securities acquired in open market transactions after the completion of the offering of the Equity Income Securities; (H) transfers by any person, other than Dominion, by gift, will or intestacy, or to affiliates or immediate family members, provided that the transferee agrees to be bound by the restrictions of this Section 6(h); (I) the filing by Dominion of a shelf registration statement from which Dominion will not offer any securities for a 90-day period after its filing date; and (J) the issuance by Dominion of up to 10,340,000 shares of Common Stock pursuant to a Purchase Agreement dated March 13, 2002, between Dominion and Salomon Smith Barney Inc. (i) To use best efforts to complete the listing application for the Corporate Units and the Common Stock to be issued and sold pursuant to the Purchase Contracts on -8- the New York Stock Exchange, Inc., subject only to official notice of issuance and evidence of satisfactory distribution. 7. Conditions of Your Obligations; Termination by You. -------------------------------------------------- (a) Your obligations to purchase and pay for the Equity Income Securities on the Closing Date shall be subject to the following conditions: (i) No stop order suspending the effectiveness of the Registration Statement shall be in effect on the Closing Date and no proceedings for that purpose shall be pending before, or to the knowledge of Dominion threatened by, the Commission on such date. You shall have received, prior to payment for the Equity Income Securities, a certificate dated the Closing Date and signed by the President or any Vice President of Dominion to the effect that no such stop order is in effect and that no proceedings for such purpose are pending before or, to the knowledge of Dominion, threatened by the Commission. (ii) The relevant order or orders of the Commission pursuant to the Holding Company Act of 1935, as amended, permitting the issuance and sale of the Equity Income Securities, a copy of which has been provided to you, shall remain in full force and effect. (iii) On the Closing Date you shall receive the opinions of Troutman Sanders Mays & Valentine LLP, your counsel, McGuireWoods LLP, counsel to Dominion and Dominion's General Counsel, substantially in the forms attached hereto as schedules, all in form and substance satisfactory to you. (iv) You shall have received letters addressed to you from Deloitte & Touche LLP, dated the date of this Purchase Agreement and the Closing Date, containing statements and information of the type ordinarily included in accountants' SAS 72 "comfort letters" to underwriters, with respect to the financial statements and certain financial information contained in or incorporated by reference into the Prospectus, including the pro-forma financial information. (v) Subsequent to the execution of this Purchase Agreement and prior to the Closing Date, (A) except as reflected in, or contemplated by, the Registration Statement and the Prospectus (exclusive of amendments or supplements after the date hereof), and except for the sale of Dominion's Common Stock as contemplated in Section 6(h)(vii) above, there shall not have occurred (1) any change in the common stock or long-term debt of Dominion (other than a decrease in the aggregate principal amount of such debt outstanding), (2) any material adverse change in the general affairs, financial condition or earnings of Dominion and its subsidiaries taken as a whole or (3) any material transaction entered into by -9- Dominion or a Significant Subsidiary other than a transaction in the ordinary course of business, the effect of which in each such case in your reasonable judgment is so material and so adverse that it makes it impracticable to proceed with the offering or delivery of the Equity Income Securities on the terms and in the manner contemplated in the Prospectus and this Purchase Agreement, and (B) there shall not have occurred (1) a downgrading in the rating accorded Dominion's senior unsecured notes, or securities that are pari passu to Dominion's senior unsecured notes, by any "nationally recognized statistical rating organization" (as that term is defined by the Commission for purposes of Rule 436(g)(2) under the Securities Act) and no such organization shall have given any notice of any intended or potential downgrading or of any review for a possible change with possible negative implications in its ratings of such securities, (2) any general suspension of trading in securities on the New York Stock Exchange or any limitation on prices for such trading or any restrictions on the distribution of securities established by the New York Stock Exchange or by the Commission or by any federal or state agency or by the decision of any court, (3) a suspension of trading of any securities of Dominion on the New York Stock Exchange, (4) a banking moratorium declared either by federal or New York State authorities or (5) any outbreak or escalation of major hostilities in which the United States is involved, any declaration of war by the United States Congress or any other substantial national or international calamity or crisis resulting in the declaration of a national emergency, or if there has occurred any material adverse change in the financial markets; provided the effect of such outbreak, escalation, declaration, calamity, crisis or material adverse change shall, in your reasonable judgment, make it impracticable to proceed with the offering or delivery of the Equity Income Securities on the terms and in the manner contemplated in the Prospectus and in this Purchase Agreement. (vi) On the Closing Date, the representations and warranties of Dominion in this Purchase Agreement shall be true and correct as if made on and as of such date, and Dominion shall have performed all obligations and satisfied all conditions required of it under this Purchase Agreement; and, on the Closing Date, you shall have received a certificate to such effect signed by the President or any Vice President of Dominion. (vii) All legal proceedings to be taken in connection with the issuance and sale of the Equity Income Securities shall have been satisfactory in form and substance to Troutman Sanders Mays & Valentine LLP. (b) In case any of the conditions specified above in Section 7(a) shall not have been fulfilled, this Purchase Agreement may be terminated by you upon mailing or delivering written notice thereof to Dominion. Any such termination shall be without liability of any party to any other party except as otherwise provided in Section 9 and Sections 6(b), 6(g) and 7(c) hereof. -10- (c) If this Purchase Agreement shall be terminated by you pursuant to Section 7(b) above or because of any failure or refusal on the part of Dominion to comply with the terms or to fulfill any of the conditions of this Purchase Agreement, or if for any reason Dominion shall be unable to perform its obligations under this Purchase Agreement, then in any such case, Dominion will reimburse you for all out-of-pocket expenses (in addition to the fees and disbursements of your counsel as provided in Section 6(g)) reasonably incurred by you in connection with this Purchase Agreement or the offering contemplated hereunder and, upon such reimbursement, Dominion shall be absolved from any further liability hereunder, except as provided in Section 6(b) and Section 9. 8. Conditions of the Obligation of Dominion. The obligation of Dominion ---------------------------------------- to deliver the Equity Income Securities shall be subject to the conditions set forth in the first sentence of Section 7(a)(i) and in Section 7(a)(ii). In case such conditions shall not have been fulfilled, this Purchase Agreement may be terminated by Dominion by mailing or delivering written notice thereof to you. Any such termination shall be without liability of any party to any other party except as otherwise provided in Sections 6(b), 6(g) and 9 hereof. 9. Indemnification and Contribution. (a) Dominion agrees to indemnify and -------------------------------- hold harmless you and each person who controls you within the meaning of Section 15 of the Securities Act or Section 20(a) of the Securities Exchange Act, against any and all losses, claims, damages or liabilities, joint or several, to which you may become subject under the Securities Act, the Securities Exchange Act, or any other statute or common law and to reimburse you and any such controlling person for any legal or other expenses (including, to the extent hereinafter provided, reasonable outside counsel fees) incurred by you in connection with investigating or defending any such losses, claims, damages, or liabilities, or in connection with defending any actions, insofar as such losses, claims, damages, liabilities, expenses or actions arise out of or are based upon any untrue statement or alleged untrue statement of a material fact contained in the Registration Statement or the Prospectus, or in either such document as amended or supplemented (if any amendments or supplements thereto shall have been furnished), or any preliminary Prospectus (if and when used prior to the date hereof), or the omission or alleged omission to state therein a material fact required to be stated therein or necessary to make the statements therein not misleading; provided that the foregoing indemnity agreement, insofar as it relates to any preliminary Prospectus, shall not inure to the benefit of you (or to the benefit of any person who controls you) on account of any losses, claims, damages or liabilities arising out of the sale of any of the Equity Income Securities by you to any person if it shall be established that a copy of the Prospectus, excluding any documents incorporated by reference (as supplemented or amended, if Dominion shall have made any supplements or amendments which have been furnished to you), shall not have been sent or given by or on behalf of you to such person at or prior to the written confirmation of the sale to such person in any case where such delivery is required by the Securities Act and Dominion satisfied its obligations pursuant to Section 6(a) hereof, if the misstatement or omission leading to such loss, claim, damage or liability was corrected in the Prospectus (excluding any documents incorporated by reference) as amended or supplemented, and such correction would have cured the defect giving -11- rise to such loss, claim, damage, or liability; and provided further, however, that the indemnity agreement contained in this Section 9(a) shall not apply to any such losses, claims, damages, liabilities, expenses or actions arising out of or based upon any such untrue statement or alleged untrue statement, or any such omission or alleged omission, if such statement or omission was made in reliance upon information furnished herein or otherwise in writing to Dominion by or on behalf of you for use in the Registration Statement or any amendment thereto, in the Prospectus or any supplement thereto, or in any preliminary Prospectus. The indemnity agreement of Dominion contained in this Section 9(a) and the representations and warranties of Dominion contained in Section 3 hereof shall remain operative and in full force and effect, regardless of any investigation made by or on behalf of you or any such controlling person, and shall survive the delivery of the Equity Income Securities. (b) You agree to indemnify and hold harmless Dominion, its officers and directors, and each person who controls any of the foregoing within the meaning of Section 15 of the Securities Act or Section 20(a) of the Securities Exchange Act, against any and all losses, claims, damages or liabilities, joint or several, to which they or any of them may become subject under the Securities Act, the Securities Exchange Act, or any other statute or common law and to reimburse each of them for any legal or other expenses (including, to the extent hereinafter provided, reasonable outside counsel fees) incurred by them in connection with investigating or defending any such losses, claims, damages or liabilities or in connection with defending any actions, insofar as such losses, claims, damages, liabilities, expenses or actions arise out of or are based upon any untrue statement or alleged untrue statement of a material fact contained in the Registration Statement or the Prospectus, or in either such document as amended or supplemented (if any amendments or supplements thereto shall have been furnished), or any preliminary Prospectus (if and when used prior to the date hereof), or the omission or alleged omission to state therein a material fact required to be stated therein or necessary to make the statements therein not misleading, if such statement or omission was made in reliance upon information furnished herein or in writing to Dominion by or on behalf of you for use in the Registration Statement or the Prospectus or any amendment or supplement to either thereof, or any preliminary Prospectus. The indemnity agreement contained in this Section 9(b) shall remain operative and in full force and effect, regardless of any investigation made by or on behalf of Dominion or any such controlling person, and shall survive the delivery of the Equity Income Securities. (c) Dominion and you agree that, upon the receipt of notice of the commencement of any action against Dominion or any of its officers or directors, or any person controlling Dominion, or against you or controlling person as aforesaid, in respect of which indemnity may be sought on account of any indemnity agreement contained herein, it will promptly give written notice of the commencement thereof to the party or parties against whom indemnity shall be sought hereunder, but the omission so to notify such indemnifying party or parties of any such action shall not relieve such indemnifying party or parties from any liability which it or they may have to the indemnified party otherwise than on account of such indemnity agreement. In case such notice of any such action shall be so given, such indemnifying party shall be entitled to participate at its own expense in the defense or, if it so elects, to assume (in conjunction with any other indemnifying parties) the -12- defense of such action, in which event such defense shall be conducted by counsel chosen by such indemnifying party (or parties) and satisfactory to the indemnified party or parties who shall be defendant or defendants in such action, and such defendant or defendants shall bear the fees and expenses of any additional outside counsel retained by them; provided that, if the defendants (including impleaded parties) in any such action include both the indemnified party and the indemnifying party (or parties) and the indemnified party shall have reasonably concluded that there may be legal defenses available to it and/or other indemnified parties which are different from or additional to those available to the indemnifying party (or parties), the indemnified party shall have the right to select separate counsel to assert such legal defenses and to participate otherwise in the defense of such action on behalf of such indemnified party. The indemnifying party shall bear the reasonable fees and expenses of outside counsel retained by the indemnified party if (i) the indemnified party shall have retained such counsel in connection with the assertion of legal defenses in accordance with the proviso to the preceding sentence (it being understood, however, that the indemnifying party shall not be liable for the expenses of more than one separate counsel (in addition to one local counsel), representing the indemnified parties under Section 9(a) or 9(b), as the case may be, who are parties to such action), (ii) the indemnifying party shall have elected not to assume the defense of such action, (iii) the indemnifying party shall not have employed counsel satisfactory to the indemnified party to represent the indemnified party within a reasonable time after notice of the commencement of the action, or (iv) the indemnifying party has authorized the employment of counsel for the indemnified party at the expense of the indemnifying party. Notwithstanding the foregoing sentence, an indemnifying party shall not be liable for any settlement of any proceeding effected without its written consent (such consent not to be unreasonably withheld), but if settled with such consent or if there be a final judgment for the plaintiff, the indemnifying party agrees to indemnify the indemnified party from and against any loss or liability by reason of such settlement or judgment. No indemnifying party shall, without the prior written consent of the indemnified party, effect any settlement of any pending or threatened proceeding in respect of which indemnification may be sought hereunder (whether or not the indemnified party is an actual or potential party to such a proceeding), unless such settlement (i) includes an unconditional release of such indemnified party from all liability on claims that are the subject matter of such proceeding and (ii) does not include a statement as to or an admission of fault, culpability or failure to act by or on behalf of any indemnified party. (d) If the indemnification provided for in this Section 9(a) or 9(b) is unavailable to or insufficient to hold harmless an indemnified party in respect of any losses, claims, damages or liabilities (or actions in respect thereof) referred to therein, then each indemnifying party shall contribute to the amount paid or payable by such indemnified party as a result of such losses, claims, damages or liabilities (or actions in respect thereof) in such proportion as is appropriate to reflect the relative fault of Dominion, on the one hand, and of you, on the other, in connection with the statements or omissions that resulted in such losses, claims, damages or liabilities (or actions in respect thereof), as well as any other relevant equitable considerations, including relative benefit. The relative fault shall be determined by reference to, among other things, whether the untrue or alleged untrue statement of a material fact or the omission or alleged omission to state a material fact required to be stated therein or necessary in order to make the statements therein not misleading -13- relates to information supplied by Dominion on the one hand or by you on the other and the parties' relative intent, knowledge, access to information and opportunity to correct or prevent such statement or omission. Dominion and you agree that it would not be just and equitable if contribution pursuant to this Section 9(d) were determined by pro rata allocation or by any other method of allocation which does not take account of the equitable considerations referred to above in this Section 9(d). The amount paid or payable by an indemnified party as a result of the losses, claims, damages or liabilities (or actions in respect thereof) referred to above in this Section 9(d) shall be deemed to include any legal or other expenses reasonably incurred by such indemnified party in connection with investigating or defending any such action or claim. No person guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of the Securities Act) shall be entitled to contribution from any person who was not guilty of such fraudulent misrepresentation. The remedies provided for in this Section 9 are not exclusive and shall not limit any rights or remedies which may otherwise be available to any indemnified party at law or in equity. 10. Intentionally omitted. 11. Representations, Warranties and Agreements to Survive Delivery. All -------------------------------------------------------------- representations, warranties and agreements contained in this Purchase Agreement or contained in certificates of officers of Dominion submitted pursuant hereto shall remain operative and in full force and effect regardless of any investigation made by or on behalf of you or any of your controlling persons, or by or on behalf of Dominion, and shall survive delivery of the Equity Income Securities. 12. Miscellaneous. The validity and interpretation of this Purchase ------------- Agreement shall be governed by the laws of the State of New York. This Purchase Agreement shall inure to the benefit of Dominion, you and, with respect to the provisions of Section 9 hereof, each controlling person and each officer and director of Dominion referred to in Section 9, and their respective successors, assigns, executors and administrators. Nothing in this Purchase Agreement is intended or shall be construed to give to any other person, firm or corporation any legal or equitable right, remedy or claim under or in respect of this Purchase Agreement or any provision herein contained. The term "successors" as used in this Purchase Agreement shall not include any purchaser, as such, of any of the Equity Income Securities from you. 13. Notices. All communications hereunder shall be in writing and if to ------- you shall be mailed, telecopied or delivered to you at the address set forth on Schedule I hereto, or if to Dominion shall be mailed, telecopied or delivered to it, attention of Treasurer, Dominion Resources, Inc., 120 Tredegar Street, Richmond, Virginia 23219 (facsimile number: (804) 819-2211). -14- Please sign and return to us a counterpart of this letter, whereupon this letter will become a binding agreement between Dominion and you in accordance with its terms. DOMINION RESOURCES, INC. By: /s/ Thomas N. Chewning Name: Thomas N. Chewning Title: Executive Vice President and Chief Financial Officer -15- The foregoing agreement is hereby confirmed and accepted, as of the date first above written. SALOMON SMITH BARNEY INC. By: /s/ Arthur H. Tildesley, Jr. Authorized Signatory Name: Arthur H. Tildesley, Jr. Title: Managing Director -16- SCHEDULE I Total Number of Firm Equity Income Securities Being Purchased: 6,000,000 Equity Income Securities Coupon on Senior Note: 5.75 % Purchase Contract Payment: 3.00 % Combined Payment Rate on Corporate Units: 8.75 % Purchase Price per Equity Income Security: $50.00 Total Purchase Price: $300,000,000 Time of Delivery: March 20, 2002, 10:00 A.M. Closing Location: One James Center 901 East Cary Street Richmond, VA 23219 The Equity Income Securities will be available for inspection at: One James Center 901 East Cary Street Richmond, VA 23219 Address for Notices to Purchaser: Salomon Smith Barney Inc. 388 Greenwich Street - 34/th/ Floor New York, NY 10013 Attn: Arthur H. Tildesley Facsimile number: (212) 816-0900 with a copy of any notice pursuant to Section 9(c) also sent to: Troutman Sanders Mays & Valentine LLP 1111 East Main Street Richmond, Virginia 23219 Attn: F. Claiborne Johnston, Jr., Esquire Facsimile number: (804) 697-1339 I-1 SCHEDULE II [Intentionally omitted] II-1 SCHEDULE III [Intentionally omitted] III-1 SCHEDULE IV PROPOSED FORM OF OPINION OF TROUTMAN SANDERS MAYS & VALENTINE LLP Bank of America Center 1111 East Main Street Richmond, Virginia 23219 Re: DOMINION RESOURCES, INC. 6,000,000 EQUITY INCOME SECURITIES CONSISTING OF 6,000,000 CORPORATE UNITS March 20, 2002 Salomon Smith Barney Inc. 388 Greenwich Street - 34/th/ Floor New York, NY 10013 Ladies and Gentlemen: We have acted as your counsel in connection with the arrangements for issuance by Dominion Resources, Inc. (Dominion) of up to 6,000,000 Equity Income Securities pursuant to a Purchase Agreement dated March 13, 2002, by and between you and Dominion (the Purchase Agreement). This letter is being delivered to you pursuant to the Purchase Agreement. All terms not otherwise defined herein shall have the meanings set forth in the Purchase Agreement. We have examined originals, or copies certified to our satisfaction of such corporate records of Dominion, indentures, agreements and other instruments, certificates of public officials, certificates of officers and representatives of Dominion and of the Trustee, and other documents, as we have deemed necessary as a basis for the opinions hereinafter expressed. As to various questions of fact material to such opinions, we have, when relevant facts were not independently established, relied upon certifications by officers of Dominion, the Trustee and other appropriate persons and statements contained in the Registration Statement hereinafter mentioned. All legal proceedings taken as of the date hereof in connection with the transactions contemplated by the Purchase Agreement have been satisfactory to us. In addition, we attended the closing held today at the offices of McGuireWoods LLP, One James Center, Richmond, Virginia, at which Dominion satisfied the conditions contained in Section 7 of the Purchase Agreement that are required to be satisfied as of the IV-1 Closing Date. Based upon the foregoing, and having regard to legal considerations that we deem relevant, we are of the opinion that: 1. Dominion is a corporation duly incorporated and existing as a corporation in good standing under the laws of Virginia, and has the corporate power to transact its business as described in the Prospectus. 2. An appropriate order of the Commission with respect to the sale of the Equity Income Securities under the Public Utility Holding Company Act of 1935, as amended, has been issued, and such order remains in effect at this date and constitutes valid and sufficient authorization for the sale of the Equity Income Securities as contemplated by the Purchase Agreement. No approval or consent by any public regulatory body, other than such order and notification of effectiveness by the Commission, is legally required in connection with the sale of the Equity Income Securities as contemplated by the Purchase Agreement (except to the extent that compliance with the provisions of securities or blue sky laws of certain states may be required in connection with the sale of the Equity Income Securities in such states) and the carrying out of the provisions of the Purchase Agreement. 3. The Purchase Agreement has been has been duly authorized by all necessary corporate action and has been duly executed and delivered by Dominion. 4. The Indenture has been duly authorized, executed and delivered by Dominion and has been duly qualified under the Trust Indenture Act and constitutes a valid and binding obligation of Dominion, except as enforcement thereof may be limited by bankruptcy, insolvency, reorganization, moratorium or other similar laws affecting the enforcement of creditors' rights generally or by general equitable principles (regardless of whether enforcement is considered in a proceeding in equity or at law). 5. The Corporate Units have been duly authorized, executed and delivered by Dominion, and assuming due execution by the Purchase Contract Agent as attorney-in-fact for the holders thereof and due authentication by the Purchase Contract Agent and upon payment therefor as set forth in the Purchase Agreement, will be duly and validly issued and outstanding, and will constitute valid and binding obligations of Dominion, except as enforcement thereof may be limited by bankruptcy, insolvency, reorganization, moratorium or other similar laws affecting the enforcement of creditors' rights generally or by general equitable principles (regardless of whether enforcement is considered in a proceeding in equity or at law). 6. The Treasury Units have been duly authorized, executed and delivered by Dominion, and assuming due execution by the Purchase Contract Agent as attorney-in-fact for the holders thereof and due authentication by the Purchase Contract Agent, will be duly and validly issued and outstanding, and will constitute valid and binding obligations of Dominion entitled to the benefits of the Purchase Contracts, except as enforcement thereof may be limited by bankruptcy, insolvency, reorganization, moratorium or other similar laws affecting the enforcement of creditors' rights generally or by general equitable principles (regardless of whether enforcement IV-2 is considered in a proceeding in equity or at law). 7. The Senior Notes have been duly authorized and executed by Dominion and when completed and authenticated by the Trustee in accordance with, and in the form contemplated by, the Indenture and issued, delivered and paid for as provided in the Purchase Agreement, will have been duly issued under the Indenture and will constitute valid and binding obligations of the Company entitled to the benefits provided by the Indenture, except as enforcement thereof may be limited by bankruptcy, insolvency, reorganization, moratorium or other similar laws affecting the enforcement of creditors' rights generally or by general equitable principles (regardless of whether enforcement is considered in a proceeding in equity or at law). 8. The unissued shares of Common Stock to be issued and sold by Dominion pursuant to the Purchase Contracts have been duly and validly authorized and reserved for issuance and, when issued and delivered in accordance with the provisions of the Purchase Contracts, will be duly and validly issued, fully paid and non-assessable. 9. The Purchase Contract Agreement has been duly authorized, executed and delivered by Dominion and, assuming due execution and delivery by the Purchase Contract Agent, the Securities Intermediary and the Collateral Agent, constitutes a valid and binding agreement of Dominion, except as enforcement thereof may be limited by bankruptcy, insolvency, reorganization, moratorium or other similar laws affecting the enforcement of creditors' rights generally or by general equitable principles (regardless of whether enforcement is considered in a proceeding in equity or at law); provided, however, that a federal court exercising jurisdiction over the bankruptcy case of Dominion, if such case were commenced and the issue were properly presented to the court and the court properly evaluated the pertinent decisional and other authorities, should conclude that, upon the occurrence of a Termination Event, Section 365(e)(1) of the Bankruptcy Code (11 U.S.C. ss.ss. 101-1330, as amended) should not substantively limit the provisions of Sections 3.15 and 5.8 of the Purchase Contract Agreement and Section 5.4 of the Pledge Agreement that require termination of the Purchase Contract Agreement and release of the Collateral Agent's security interest in the Senior Notes or the Treasury Securities. However, this opinion is not based on directly controlling legal authority, but rather on what we believe to be a sound analysis of existing authorities from various jurisdictions regardless of the precedential effect on the particular court that might have occasion to make such a decision. 10. The Remarketing Agreement has been duly authorized by all necessary corporate action and has been duly executed and delivered by Dominion. 11. The Pledge Agreement has been duly authorized, executed and delivered by Dominion and, assuming due execution and delivery by the Purchase Contract Agent, constitutes a valid and binding agreement of Dominion, except as enforcement thereof may be limited by bankruptcy, insolvency, reorganization, moratorium or other similar laws affecting the enforcement of creditors' rights generally or by general equitable principles (regardless of whether enforcement is considered in a proceeding in equity or at law); provided, however, that a federal court exercising jurisdiction over the bankruptcy case of Dominion, if such case were commenced and the issue were properly presented to the court and the court properly evaluated the pertinent decisional and other authorities, should conclude that, upon the occurrence of a IV-3 Termination Event, Section 365(e)(1) of the Bankruptcy Code (11 U.S.C. (S)(S) 101-1330, as amended) should not substantively limit the provisions of Sections 3.15 and 5.8 of the Purchase Contract Agreement and Section 5.4 of the Pledge Agreement that require termination of the Purchase Contract Agreement and release of the Collateral Agent's security interest in the Senior Notes or the Treasury Securities. However, this opinion is not based on directly controlling legal authority, but rather on what we believe to be a sound analysis of existing authorities from various jurisdictions regardless of the precedential effect on the particular court that might have occasion to make such a decision. 12. The Registration Statement with respect to the Equity Income Securities filed pursuant to the Securities Act, has become effective and remains in effect at this date, and the Prospectus may lawfully be used for the purposes specified in the Securities Act in connection with the offer for sale and the sale of Equity Income Securities in the manner therein specified. 13. The Registration Statement and the Prospectus (except that we express no comment or belief with respect to any historical or pro forma financial statements and schedules and other financial or statistical information contained or incorporated by reference in the Registration Statement or Prospectus) appear on their face to be appropriately responsive in all material respects to the requirements of the Securities Act, and to the applicable rules and regulations of the Commission thereunder. 14. As to the statements relating to the Equity Income Securities, the Senior Notes, and the Common Stock contained in the prospectus initially filed as part of the Registration Statement under DESCRIPTION OF DEBT SECURITIES, ADDITIONAL TERMS OF SENIOR DEBT SECURITIES, DESCRIPTION OF CAPITAL STOCK and DESCRIPTION OF STOCK PURCHASE CONTRACTS AND STOCK PURCHASE UNITS, as all or any of them have been supplemented by the statements under DESCRIPTION OF THE EQUITY INCOME SECURITIES, DESCRIPTION OF THE PURCHASE CONTRACTS, CERTAIN PROVISIONS OF THE PURCHASE CONTRACTS, THE PURCHASE CONTRACT AGREEMENT, AND THE PLEDGE AGREEMENT and DESCRIPTION OF THE SENIOR NOTES in the Prospectus Supplement dated March 13, 2002, we are of the opinion that the statements are accurate and do not omit any material fact required to be stated therein or necessary to make such statements not misleading. As to the statistical statements in the Registration Statement (which includes statistical statements in the Incorporated Documents), we have relied solely on the officers of Dominion. We have not undertaken to determine independently the accuracy or completeness of the statements contained or incorporated by reference in the Registration Statement or in the Prospectus. We accordingly assume no responsibility for the accuracy or completeness of the statements made in the Registration Statement, except as stated above in the preceding paragraph in regard to the captions set forth in such preceding paragraph. We note that the Incorporated Documents were prepared and filed by Dominion without our participation. We have, however, participated in conferences with counsel for and representatives of Dominion in connection with the preparation of the Registration Statement, the Prospectus as it was initially issued and as has been supplemented or amended, and we have reviewed the Incorporated Documents and such of IV-4 the corporate records of Dominion as we deemed advisable. None of the foregoing disclosed to us any information that gives us reason to believe that the Registration Statement contained on the date the Registration Statement became effective, or the Prospectus contained on the date it was issued or the date it was supplemented or amended, or that the Registration Statement or the Prospectus (in all cases, excepting the financial statements and schedules and other financial information contained or incorporated therein by reference and any pro forma financial information (and notes thereto) included or incorporated by reference therein, as to which we express no belief) contains on the date hereof, any untrue statement of a material fact or omitted or omits on the date hereof to state a material fact required to be stated therein or necessary to make the statements therein not misleading. The foregoing assurance is provided on the basis that any statement contained in an Incorporated Document shall be deemed not to be contained in the Registration Statement or Prospectus if the statement has been modified or superseded by any statement in a subsequently filed Incorporated Document or in the Registration Statement or Prospectus prior to the date of the Purchase Agreement. We do not purport to express an opinion on any laws other than those of the Commonwealth of Virginia, the State of New York and the United States of America. This opinion may not be relied upon by, nor may copies be delivered to, any person without our prior written consent. Very truly yours, TROUTMAN SANDERS MAYS & VALENTINE LLP IV-5 SCHEDULE V PROPOSED FORM OF OPINION OF MCGUIREWOODS LLP One James Center 901 East Cary Street Richmond, Virginia 23219 Re: DOMINION RESOURCES, INC. 6,000,000 EQUITY INCOME SECURITIES CONSISTING OF 6,000,000 CORPORATE UNITS March 20, 2002 Salomon Smith Barney Inc. 388 Greenwich Street - 34/th/ Floor New York, NY 10013 Ladies and Gentlemen: The arrangements for issuance of up to 6,000,000 Equity Income Securities of Dominion Resources, Inc. (Dominion), pursuant to an Purchase Agreement dated March 13, 2002, by and between Dominion and you (the Purchase Agreement), have been taken under our supervision as counsel for Dominion. This letter is being delivered to you pursuant to the Purchase Agreement. All terms not otherwise defined herein shall have the meanings set forth in the Purchase Agreement. We have examined originals, or copies certified to our satisfaction, of such corporate records of Dominion, indentures, agreements, and other instruments, certificates of public officials, certificates of officers and representatives of Dominion and of the Trustee, and other documents, as we have deemed it necessary to require as a basis for the opinions hereinafter expressed. As to various questions of fact material to such opinions, we have, when relevant facts were not independently established, relied upon certifications by officers of Dominion, the Trustee and other appropriate persons and statements contained in the Registration Statement hereinafter mentioned. All legal proceedings taken as of the date hereof in connection with the transactions contemplated by the Purchase Agreement have been satisfactory to us. On this basis we are of the opinion that: V-1 1. No filing with, or authorization, approval, consent, license, order, registration, qualification or decree of, any court or governmental authority or agency, domestic or foreign (other than those required under the Public Utility Holding Company Act of 1935, the Securities Act and the Rules and Regulations, which have been obtained, or as may be required under the securities or blue sky laws of the various states) is necessary or required in connection with the due authorization, execution and delivery of the Purchase Agreement by Dominion or for the offering, issuance, sale or delivery of the Equity Income Securities. An appropriate order of the Securities and Exchange Commission (the Commission) with respect to the sale of the Equity Income Securities under the Public Utility Holding Company Act of 1935, as amended, has been issued, and such order remains in effect at this date and constitutes valid and sufficient authorization for the sale of the Equity Income Securities as contemplated by the Purchase Agreement. 2. The Indenture has been duly authorized, executed and delivered by Dominion and has been duly qualified under the Trust Indenture Act and constitutes a valid and binding obligation of Dominion, except as enforcement thereof may be limited by bankruptcy, insolvency, reorganization, moratorium or other similar laws affecting the enforcement of creditors' rights generally or by general equitable principles (regardless of whether enforcement is considered in a proceeding in equity or at law). 3. The Corporate Units have been duly authorized, executed and delivered by Dominion, and assuming due execution by the Purchase Contract Agent as attorney-in-fact for the holders thereof and due authentication by the Purchase Contract Agent and upon payment therefor as set forth in the Purchase Agreement, will be duly and validly issued and outstanding, and will constitute valid and binding obligations of Dominion, except as enforcement thereof may be limited by bankruptcy, insolvency, reorganization, moratorium or other similar laws affecting the enforcement of creditors' rights generally or by general equitable principles (regardless of whether enforcement is considered in a proceeding in equity or at law). 4. The Treasury Units have been duly authorized, executed and delivered by Dominion, and assuming due execution by the Purchase Contract Agent as attorney-in-fact for the holders thereof and due authentication by the Purchase Contract Agent, will be duly and validly issued and outstanding, and will constitute valid and binding obligations of Dominion, except as enforcement thereof may be limited by bankruptcy, insolvency, reorganization, moratorium or other similar laws affecting the enforcement of creditors' rights generally or by general equitable principles (regardless of whether enforcement is considered in a proceeding in equity or at law). 5. The Senior Notes have been duly authorized and executed by Dominion and when completed and authenticated by the Trustee in accordance with, and in the form contemplated by, the Indenture and issued, delivered and paid for as provided in the Purchase Agreement, will have been duly issued under the Indenture and will constitute valid and binding obligations of the Company entitled to the benefits provided by the Indenture, except as enforcement thereof may be limited by bankruptcy, insolvency, reorganization, moratorium or other similar laws affecting the enforcement of creditors' rights generally or by general equitable principles (regardless of whether enforcement is considered in a proceeding in equity or at law). V-2 6. The unissued shares of Common Stock to be issued and sold by Dominion pursuant to the Purchase Contracts have been duly and validly authorized and reserved for issuance and, when issued and delivered in accordance with the provisions of the Purchase Contracts, will be duly and validly issued, fully paid and non-assessable. 7. The Purchase Contract Agreement has been duly authorized, executed and delivered by Dominion and, assuming due execution and delivery by the Purchase Contract Agent, the Securities Intermediary and the Collateral Agent, constitutes a valid and binding agreement of Dominion, except as enforcement thereof may be limited by bankruptcy, insolvency, reorganization, moratorium or other similar laws affecting the enforcement of creditors' rights generally or by general equitable principles (regardless of whether enforcement is considered in a proceeding in equity or at law); provided, however, that a federal court exercising jurisdiction over the bankruptcy case of Dominion, if such case were commenced and the issue were properly presented to the court and the court properly evaluated the pertinent decisional and other authorities, should conclude that, upon the occurrence of a Termination Event, Section 365(e)(1) of the Bankruptcy Code (11 U.S.C. ss.ss. 101-1330, as amended) should not substantively limit the provisions of Sections 3.15 and 5.8 of the Purchase Contract Agreement and Section 5.4 of the Pledge Agreement that require termination of the Purchase Contract Agreement and release of the Collateral Agent's security interest in the Senior Notes or the Treasury Securities. However, this opinion is not based on directly controlling legal authority, but rather on what we believe to be a sound analysis of existing authorities from various jurisdictions regardless of the precedential effect on the particular court that might have occasion to make such a decision. 8. The Pledge Agreement has been duly authorized, executed and delivered by Dominion and, assuming due execution and delivery by the Purchase Contract Agent, constitutes a valid and binding agreement of Dominion, except as enforcement thereof may be limited by bankruptcy, insolvency, reorganization, moratorium or other similar laws affecting the enforcement of creditors' rights generally or by general equitable principles (regardless of whether enforcement is considered in a proceeding in equity or at law); provided, however, that a federal court exercising jurisdiction over the bankruptcy case of Dominion, if such case were commenced and the issue were properly presented to the court and the court properly evaluated the pertinent decisional and other authorities, should conclude that, upon the occurrence of a Termination Event, Section 365(e)(1) of the Bankruptcy Code (11 U.S.C. ss.ss. 101-1330, as amended) should not substantively limit the provisions of Sections 3.15 and 5.8 of the Purchase Contract Agreement and Section 5.4 of the Pledge Agreement that require termination of the Purchase Contract Agreement and release of the Collateral Agent's security interest in the Senior Notes or the Treasury Securities. However, this opinion is not based on directly controlling legal authority, but rather on what we believe to be a sound analysis of existing authorities from various jurisdictions regardless of the precedential effect on the particular court that might have occasion to make such a decision. 9. The Corporate Units, the Indenture, the Senior Notes, the Common Stock to be issued and sold pursuant to the Purchase Contract Agreement, the Purchase Contract Agreement, the Pledge Agreement and the Remarketing Agreement, when the Corporate Units V-3 are delivered pursuant to the Agreement, will conform to the descriptions thereof contained in the Prospectus. 10. The Registration Statement and the Prospectus (except the financial statements, any pro forma information and schedules contained or incorporated by reference therein, as to which we express no opinion) appear on their face to be appropriately responsive in all material respects to the requirements of the Securities Act, and to the applicable rules and regulations of the Commission thereunder. 11. We are of the opinion that the statements relating to the Equity Income Securities, the Senior Notes, and the Common Stock contained in the prospectus initially filed as part of the Registration Statement under DESCRIPTION OF DEBT SECURITIES, ADDITIONAL TERMS OF SENIOR DEBT SECURITIES, DESCRIPTION OF CAPITAL STOCK and DESCRIPTION OF STOCK PURCHASE CONTRACTS AND STOCK PURCHASE UNITS, as all or any of them have been supplemented by the statements under DESCRIPTION OF THE EQUITY INCOME SECURITIES, DESCRIPTION OF THE PURCHASE CONTRACTS, CERTAIN PROVISIONS OF THE PURCHASE CONTRACTS, THE PURCHASE CONTRACT AGREEMENT, AND THE PLEDGE AGREEMENT and DESCRIPTION OF THE SENIOR NOTES in the Prospectus Supplement dated March 13, 2002 are substantially accurate and fair. 12. With regard to the discussion in the Prospectus Supplement under the caption CERTAIN UNITED STATES FEDERAL INCOME TAX CONSIDERATIONS, we are of the opinion that under current United States federal income tax law, although the discussion does not purport to discuss all possible United States federal income tax consequences of the purchase, ownership and disposition of the Equity Income Securities, the Senior Notes and the Common Stock acquired under a Purchase Contract, such discussion constitutes an accurate summary of the matters discussed therein in all material respects. In rendering the aforementioned tax opinion, we have considered the current provisions of the Internal Revenue Code of 1986, as amended, Treasury regulations promulgated thereunder, judicial decisions and Internal Revenue Service rulings, all of which are subject to change, which changes may be retroactively applied. A change in the authorities upon which our opinion is based could affect our conclusions. There can be no assurance, moreover, that any of the opinions expressed herein will be accepted by the Internal Revenue Service, or, if challenged, by a court. We have participated in conferences with officers and other representatives of Dominion and your representatives at which the contents of the Registration Statement and the Prospectus were discussed, and we have consulted with officers and other employees of Dominion to inform them of the disclosure requirements of the Securities Act. We have examined various reports, records, contracts and other documents of Dominion and orders and instruments of public officials, which our investigation led us to deem pertinent. In addition, we attended the due diligence meetings with representatives of Dominion and the closing at which Dominion satisfied the conditions contained in Section 7 of the Purchase Agreement. We have not, however, undertaken to make any independent review of other records of Dominion which our investigation did not lead us to deem pertinent. As to the statistical statements in the Registration Statement (which includes the Incorporated Documents), we have relied solely on V-4 the officers of Dominion. We accordingly assume no responsibility for the accuracy or completeness of the statements made in the Registration Statement, except as stated above in the preceding two paragraphs in regard to the captions set forth in such preceding two paragraphs. But such conferences, consultation, examination and attendance disclosed to us no information with respect to such other matters that gives us reason to believe that the Registration Statement contained on the date the Registration Statement became effective, or the Prospectus contained on the date it was issued, or that the Registration Statement or the Prospectus (in each case, except with respect to the financial statements and schedules and other financial information contained or incorporated by reference in the Registration Statement or Prospectus) contains on the date hereof, any untrue statement of a material fact or omitted on such date or omits on the date hereof to state a material fact required to be stated therein or necessary to make the statements therein not misleading. The foregoing assurance is provided on the basis that any statement contained in an Incorporated Document shall be deemed not to be contained in the Registration Statement or Prospectus if the statement has been modified or superseded by any statement in a subsequently filed Incorporated Document or in the Registration Statement or Prospectus prior to the date of the Purchase Agreement. We do not purport to express an opinion on any laws other than those of the Commonwealth of Virginia, the State of New York and the United States of America. This opinion may not be relied upon by, nor may copies be delivered to, any person without our prior written consent. Yours very truly, MCGUIREWOODS LLP V-5 SCHEDULE VI PROPOSED FORM OF OPINION OF GENERAL COUNSEL OF DOMINION RESOURCES, INC. 120 Tredegar Street Richmond, VA 23219 Re: DOMINION RESOURCES, INC. 6,000,000 EQUITY INCOME SECURITIES CONSISTING OF 6,000,000 CORPORATE UNITS March 20, 2002 Salomon Smith Barney Inc. 388 Greenwich Street - 34/th/ Floor New York, NY 10013 Ladies and Gentlemen: The arrangements for issuance of up to 6,000,000 Equity Income Securities of Dominion Resources, Inc. (Dominion), pursuant to an Purchase Agreement dated March 13, 2002, by and between Dominion and you listed on Schedule II as attached thereto (the Purchase Agreement), have been taken under my supervision as Vice President and General Counsel of Dominion. Terms not otherwise defined herein have the meanings set forth in the Purchase Agreement. As Vice President and General Counsel of Dominion, I have general responsibility over the attorneys within Dominion's Legal Department responsible for rendering legal counsel to Dominion regarding corporate, financial, securities, and other matters. I am generally familiar with the organization, business and affairs of Dominion. I am also familiar with the proceedings taken and proposed to be taken by Dominion in connection with the offering and sale of the Equity Income Securities, and I have examined such corporate records, certificates and other documents and such questions of the law as I have considered necessary or appropriate for the purposes of this opinion. In addition, I have responsibility for supervising lawyers who may have been asked by me or others to review legal matters arising in connection with the offering and sale of the Equity Income Securities. Accordingly, some of the matters referred to herein have not been handled personally by me, but I have been made familiar with VII-1 the facts and circumstances and the applicable law, and the opinions herein expressed are my own or are opinions of others in which I concur. On this basis I am of the opinion that: 1. Dominion has been duly incorporated and is validly existing as a corporation in good standing under the laws of Virginia, and has corporate power and authority to own, lease and operate its properties and to conduct its business as described in the Prospectus and to enter into and perform its obligations under the Purchase Agreement; and Dominion is duly qualified as a foreign corporation to transact business and is in good standing in each other jurisdiction in which such qualification is required, whether by reason of the ownership or leasing of property or the conduct of business, except where the failure to so qualify or to be in good standing would not result in a Material Adverse Effect. 2. Each Significant Subsidiary of Dominion has been duly incorporated and is validly existing as a corporation in good standing under the respective laws of the jurisdiction of its incorporation, has corporate power and authority to own, lease and operate its properties and to conduct its business as described in the Prospectus and is duly qualified as a foreign corporation to transact business and is in good standing in each jurisdiction in which such qualification is required, whether by reason of the ownership or leasing of property or the conduct of business, except where the failure to so qualify or to be in good standing would not result in a Material Adverse Effect. 3. The Purchase Agreement has been duly authorized, executed and delivered by Dominion. 4. The Remarketing Agreement has been duly authorized, executed and delivered by Dominion. 5. There are no actions, suits or proceedings pending or, to the best of my knowledge, threatened, to which Dominion or one of its subsidiaries is a party or to which any of Dominion's or any of its subsidiaries' properties is subject other than any proceedings described in the Prospectus and proceedings which I believe are not likely to have a material adverse effect on the power or ability of Dominion to perform its obligations under the Purchase Agreement or to consummate the transactions contemplated thereby or by the Prospectus. I am a member of the Bar of the Commonwealth of Virginia and I do not purport to express an opinion on any laws other than those of the Commonwealth of Virginia and the United States of America. This opinion may not be relied upon by, nor may copies be delivered to, any person without our prior written consent. I do not undertake to advise you of any changes in the opinions expressed herein resulting from matters that may hereinafter arise or that may hereinafter be brought to my attention. Yours very truly, VII-2 EX-4.2 4 dex42.txt FORM OF TENTH SUPPLEMENTAL INDENTURE Exhibit 4.2 DOMINION RESOURCES, INC. Issuer TO JPMORGAN CHASE BANK (formerly known as The Chase Manhattan Bank) Trustee ------------------------- Tenth Supplemental Indenture Dated as of March 1, 2002 ------------------------- Up to $330,000,000 2002 Series A 5.75% Senior Notes, due May 15, 2008 TABLE OF CONTENTS* ARTICLE I 2002 SERIES A 5.75% SENIOR NOTES ........................ 1 SECTION 101. Establishment ............................................... 1 SECTION 102. Definitions ................................................. 2 SECTION 103. Payment of Principal and Interest ........................... 5 SECTION 104. Denominations ............................................... 6 SECTION 105. Global Securities ........................................... 7 SECTION 106. Remarketing. ................................................ 7 SECTION 107. Sinking Fund ................................................ 11 SECTION 108. Additional Interest ......................................... 11 SECTION 109. Paying Agent ................................................ 11 SECTION 110. Limitation on Liens ......................................... 11 SECTION 111. Tax Event Redemption. ....................................... 14 SECTION 112. Tax Treatment. .............................................. 15 ARTICLE II MISCELLANEOUS PROVISIONS ............................... 16 SECTION 201. Recitals by Company ......................................... 16 SECTION 202. Ratification and Incorporation of Original Indenture ........ 16 SECTION 203. Executed in Counterparts .................................... 16 SECTION 204. Assignment .................................................. 16
______________________ * This Table of Contents does not constitute part of the Indenture or have any bearing upon the interpretation of any of its terms and provisions. THIS TENTH SUPPLEMENTAL INDENTURE is made as of the first day of March, 2002, by and between DOMINION RESOURCES, INC., a Virginia corporation, having its principal office at 120 Tredegar Street, Richmond, Virginia 23219 (the "Company"), and JPMORGAN CHASE BANK (formerly known as The Chase Manhattan Bank), a New York banking corporation, as Trustee (herein called the "Trustee"). W I T N E S S E T H: WHEREAS, the Company has heretofore entered into a Senior Indenture, dated as of June 1, 2000 (the "Original Indenture"), as heretofore supplemented and amended, with the Trustee; WHEREAS, the Original Indenture is incorporated herein by this reference and the Original Indenture, as heretofore supplemented and amended and as further supplemented by this Tenth Supplemental Indenture, is herein called the "Indenture"; WHEREAS, under the Original Indenture, a new series of Securities may at any time be established in accordance with the provisions of the Original Indenture and the terms of such series may be described by a supplemental indenture executed by the Company and the Trustee; WHEREAS, the Company proposes to create under the Indenture a series of Securities; WHEREAS, additional Securities of other series hereafter established, except as may be limited in the Original Indenture as at the time supplemented and modified, may be issued from time to time pursuant to the Indenture as at the time supplemented and modified; and WHEREAS, all conditions necessary to authorize the execution and delivery of this Tenth Supplemental Indenture and to make it a valid and binding obligation of the Company have been done or performed. NOW, THEREFORE, in consideration of the agreements and obligations set forth herein and for other good and valuable consideration, the sufficiency of which is hereby acknowledged, the parties hereto hereby agree as follows: ARTICLE I 2002 SERIES A 5.75% SENIOR NOTES SECTION 101. Establishment. There is hereby established a new series of ------------- Securities to be issued under the Indenture, to be designated as the Company's 2002 Series A 5.75% Senior Notes, due May 15, 2008 (the "Senior Notes"). There are to be authenticated and delivered $300,000,000 principal amount of Senior Notes ($330,000,000 aggregate principal amount if the purchaser of the certificates of which the Senior Notes are a part exercises its overallotment option in full) and no further Senior Notes shall be authenticated and delivered except as provided by Sections 304, 305, 306 or 905 of the Original Indenture or by Section 106 hereof. The Senior Notes shall be issued in definitive fully registered form without coupons, in substantially the form set out in Exhibit A hereto. The --------- entire principal amount of the Senior Notes shall initially be evidenced by one or more certificates issued to JPMorgan Chase Bank, as Purchase Contract Agent under the Purchase Contract Agreement (as defined below). The form of the Trustee's Certificate of Authentication for the Senior Notes shall be in substantially the form set forth in Exhibit B hereto. --------- Each Senior Note shall be dated the date of authentication thereof and shall bear interest from the date of original issuance thereof or from the most recent Interest Payment Date to which interest has been paid or duly provided for. SECTION 102. Definitions. The following defined terms used herein shall, ----------- unless the context otherwise requires, have the meanings specified below. Capitalized terms used herein for which no definition is provided herein shall have the meanings set forth in the Original Indenture, the Purchase Contract Agreement, or the Remarketing Agreement, as the case may be and as the context may require. "Applicable Spread" means the spread determined as set forth below, based on the Prevailing Rating of the Senior Notes in effect at the close of business on the Business Day immediately preceding the date of the Failed Remarketing: Prevailing Rating Spread ----------------- ------ AA/"Aa2" ......................................... 3.00% A/"A2" ........................................... 4.00% BBB/"Baa2" ....................................... 5.00% Below BBB/"Baa2" ................................. 7.00% "Business Day" has the meaning set forth in Section 1.1(d) of the Purchase Contract Agreement. "Interest Payment Dates" means February 15, May 15, August 15 and November 15 of each year, commencing on May 15, 2002. "Lien" means any mortgage, lien, pledge, security interest or other encumbrance of any kind. "Material Subsidiary" means a Subsidiary of the Company whose total assets (as determined in accordance with GAAP) represent at least 20% of the total assets of the Company on a consolidated basis. "Original Issue Date" means March 20, 2002. "Outstanding", when used with respect to the Senior Notes, means, as of the date of determination, all Senior Notes, theretofore authenticated and delivered under the Indenture, except: (i) Senior Notes theretofore canceled by the Trustee or delivered to the Trustee for cancellation; 2 (ii) Senior Notes for whose payment at Maturity the necessary amount of money or money's worth has been theretofore deposited (other than pursuant to Section 402 of the Original Indenture) with the Trustee or any Paying Agent (other than the Company) in trust or set aside and segregated in trust by the Company (if the Company shall act as its own Paying Agent) for the Holders of such Senior Notes. (iii) Senior Notes with respect to which the Company has effected defeasance or covenant defeasance has been effected pursuant to Section 402 of the Original Indenture; and (iv) Senior Notes that have been paid pursuant to Section 306 of the Original Indenture or in exchange for or in lieu of which other Senior Notes have been authenticated and delivered pursuant to the Indenture, other than any such Senior Notes in respect of which there shall have been presented to the Trustee proof satisfactory to it that such Senior Notes are held by a bona fide purchaser in whose hands such Senior Notes are valid obligations of the Company; provided, however, that in determining whether the Holders of the requisite principal amount of Outstanding Senior Notes have given any request, demand, authorization, direction, notice, consent or waiver hereunder or are present at a meeting of Holders of Senior Notes for quorum purposes, Senior Notes owned by the Company or any other obligor upon the Senior Notes or any Affiliate of the Company or such other obligor shall be disregarded and deemed not to be Outstanding, except that, in determining whether the Trustee shall be protected in making any such determination or relying upon any such request, demand, authorization, direction, notice, consent or waiver, only Senior Notes which a Responsible Officer of the Trustee knows to be so owned shall be so disregarded. Senior Notes so owned which shall have been pledged in good faith may be regarded as Outstanding if the pledgee establishes to the satisfaction of the Trustee (A) the pledgee's right so to act with respect to such Senior Notes and (B) that the pledgee is not the Company or any other obligor upon the Senior Notes or an Affiliate of the Company or such other obligor. "Pledge Agreement" means the Pledge Agreement, dated as of March 20, 2002, among the Company, Bank One Trust Company, N.A., as Collateral Agent and Securities Intermediary, and JPMorgan Chase Bank, as Purchase Contract Agent. "Prevailing Rating," for the purposes of the definition of Applicable Spread, means: (i) AA/"Aa2" if the Senior Notes have a credit rating of AA or better by Standard & Poor's Ratings Services ("S&P") and "Aa2" or better by Moody's Investors Service, Inc. ("Moody's") or the equivalent of such ratings by such agencies or a substitute rating agency or substitute rating agencies selected by the Remarketing Agent; (ii) if not under clause (i) above, then A/"A2" if the Senior Notes have a credit rating of A or better by S&P and "A2" or better by Moody's or the equivalent of such ratings by such agencies or a substitute rating agency or substitute rating agencies selected by the Remarketing Agent; 3 (iii) if not under clauses (i) or (ii) above, then BBB/"Baa2" if the Senior Notes have a credit rating of BBB or better by S&P and "Baa2" or better by Moody's or the equivalent of such ratings by such agencies or a substitute rating agency or substitute rating agencies selected by the Remarketing Agent; or (iv) if not under clauses (i), (ii) or (iii) above, then Below BBB/"Baa2". Notwithstanding the foregoing, (A) if (i) the credit rating of the Senior Notes by S&P shall be on the "Credit Watch" of S&P with a designation of "negative implications" or "developing", or (ii) the credit rating of the Senior Notes by Moody's shall be on the "Corporate Credit Watch List" of Moody's with a designation of "downgrade" or "uncertain", or, in each case, on any successor list of S&P or Moody's with a comparable designation, the Prevailing Ratings of the Senior Notes shall be deemed to be within a range one full level lower in the table set forth in the definition of Applicable Spread than those actually assigned to the Senior Notes by S&P and Moody's and (B) if the Senior Notes are rated by only one rating agency prior to or on the Remarketing Date, the Prevailing Rating shall at all times be determined without reference to the rating of any other rating agency; provided that if no such rating agency shall have in effect a rating for the Senior Notes and the Remarketing Agent is unable to identify a substitute rating agency or rating agencies, the Prevailing Rating shall be below BBB/"Baa2". "Principal Property" means any plant or facility of the Company located in the United States that in the opinion of the Board of Directors or management of the Company is of material importance to the business conducted by the Company and its consolidated Subsidiaries taken as whole. "Purchase Contract Agreement" means the Purchase Contract Agreement, dated as of March 20, 2002, between the Company and JPMorgan Chase Bank, as Purchase Contract Agent. "Regular Record Date" means, with respect to each Interest Payment Date, the close of business on the Business Day preceding such Interest Payment Date; provided, that with respect to Senior Notes that are not in book-entry only form, the Regular Record Date shall be the close of business on the 15th Business Day preceding such Interest Payment Date. "Remarketing" has the meaning set forth in Section 106. "Remarketing Agreement" means the Remarketing Agreement, dated as of March 20, 2002, between the Company and Salomon Smith Barney Inc. "Reset Rate" means the interest rate per annum with respect to the Senior Notes that is determined by the Remarketing Agent pursuant to the Remarketing Agreement as follows: (i) in connection with a Successful Remarketing, the interest rate determined by the Remarketing Agent sufficient to allow it to remarket the Remarketing Senior Notes at a price at least equal to the Remarketing Value; (ii) upon the occurrence of a Failed Remarketing, the Two-Year Benchmark Rate plus the Applicable Spread; or 4 (iii) if (a) there are no Pledged Senior Notes to be remarketed and (b) none of the holders of Separated Senior Notes have elected to have their Senior Notes remarketed in accordance with Section 106 hereof and Section 5.7 of the Pledge Agreement, the Reset Rate shall be the rate determined, in its sole discretion, by the Remarketing Agent, as the rate that, in its judgment, would have been established had a Remarketing been held on the Final Remarketing Date. "Separated Senior Notes" means Senior Notes that are not Pledged Senior Notes. "Stated Maturity" means May 15, 2008. "Telerate" means the Dow Jones Telerate Service. "Two-Year Benchmark Rate" means the bid side rate displayed at 10:00 a.m. (New York City time) on the third Business Day preceding the Purchase Contract Settlement Date for direct obligations of the United States having a maturity comparable to the remaining term to the Stated Maturity of the Senior Notes, as agreed upon by the Company and the Remarketing Agent as displayed in the Telerate system or, if the Telerate system is no longer available or, in the judgment of the Remarketing Agent (after consultation with the Company), no longer an appropriate system from which to obtain such rate, such other nationally recognized quotation system as, in the judgment of the Remarketing Agent (after consultation with the Company) is appropriate. If this rate is not so displayed, the Two-Year Benchmark Rate will be calculated by the Remarketing Agent as the yield to maturity for direct obligations of the United States having a maturity comparable to the remaining term to the Stated Maturity of the Senior Notes, expressed as a bond equivalent on the basis of a year of 365 or 366 days, as applicable, and applied on a daily basis, and computed by taking the arithmetic mean of the secondary market bid rates, as of 10:30 a.m. (New York City time) on the third Business Day preceding the Purchase Contract Settlement Date of three leading United States government securities dealers selected by the Remarketing Agent (after consultation with the Company) (which may include the Remarketing Agent or an Affiliate thereof). However, if, in the judgment of the Remarketing Agent, after consultation with the Company, direct obligations of the United States are no longer appropriate benchmarks for the purpose of setting the Reset Rate if a Failed Remarketing has occurred, the Remarketing Agent and the Company will agree upon another Two-Year Benchmark Rate. SECTION 103. Payment of Principal and Interest. The principal of the --------------------------------- Senior Notes shall be due at the Stated Maturity. The unpaid principal amount of the Senior Notes shall bear interest at the rate of 5.75% per annum from the Original Issue Date to, but excluding, the earlier of (i) the Remarketing Settlement Date or (ii) the Purchase Contract Settlement Date, and, thereafter, at the Reset Rate to, but excluding, the Stated Maturity of the Senior Notes. Interest shall be paid quarterly in arrears on each Interest Payment Date to the Person in whose name the Senior Notes are registered on the Regular Record Date for such Interest Payment Date; provided that interest payable at the Stated Maturity of principal as provided herein will be paid to the Person to whom principal is payable. Any such interest that is not so punctually paid or duly provided for will forthwith cease to be payable to the Holders on such Regular Record Date and may either be paid to the Person or Persons in whose name the Senior Notes are registered at the close of business on a Special Record Date for the payment of such defaulted interest to be fixed 5 by the Trustee (in accordance with Section 307 of the Original Indenture), notice whereof shall be given to Holders of the Senior Notes not less than ten (10) days prior to such Special Record Date, or be paid at any time in any other lawful manner not inconsistent with the requirements of any securities exchange, if any, on which the Senior Notes may be listed, and upon such notice as may be required by any such exchange, all as more fully provided in the Original Indenture. Payments of interest on the Senior Notes will include interest accrued to but excluding the respective Interest Payment Dates. Interest payments for the Senior Notes shall be computed and paid (1) for any full quarterly period, on the basis of a 360-day year of twelve 30-day months, (2) for any period shorter than a full quarterly period, on the basis of a 30-day month and (3) for any period less than a month, on the basis of the actual number of days elapsed per 30-day month. In the event that any date on which interest is payable on the Senior Notes is not a Business Day, then payment of the interest payable on such date will be made on the next succeeding day that is a Business Day (and without any interest or payment in respect of any such delay), in each case with the same force and effect as if made on the date the payment was originally payable. However, if such Business Day is in the next calendar year, then such payment will be made on the preceding Business Day. Payment of the principal and interest on the Senior Notes shall be made at the office of the Paying Agent in such coin or currency of the United States of America as at the time of payment is legal tender for payment of public and private debts, with any such payment that is due at the Stated Maturity of any Senior Notes being made upon surrender of such Senior Notes to the Paying Agent. Payments of interest (including interest on any Interest Payment Date) will be made, subject to such surrender where applicable, at the option of the Company, (i) by check mailed to the address of the Person entitled thereto as such address shall appear in the Security Register or (ii) by wire transfer at such place and to such account at a banking institution in the United States as may be designated in writing to the Trustee at least sixteen (16) days prior to the date for payment by the Person entitled thereto. In the event that any date on which principal and interest is payable on the Senior Notes is not a Business Day, then payment of the principal and interest payable on such date will be made on the next succeeding day that is a Business Day (and without any interest or payment in respect of any such delay), in each case with the same force and effect as if made on the date the payment was originally payable. However, if such Business Day is in the next calendar year, then such payment will be made on the preceding Business Day. SECTION 104. Denominations. The Senior Notes may be issued in ------------- denominations of $50, or any integral multiple thereof. SECTION 105. Global Securities. The Senior Notes that, in accordance with ----------------- the Purchase Contract Agreement, are no longer part of the Corporate Units will be issued initially in the form of one or more Global Securities registered in the name of the Depositary (which shall be The Depository Trust Company) or its nominee. Except under the limited circumstances described below, Senior Notes represented by such Global Securities will not be exchangeable for, and will not otherwise be issuable as, Senior Notes in definitive form. The Global Securities described above may not be transferred except by the Depositary to a nominee of the Depositary 6 or by a nominee of the Depositary to the Depositary or another nominee of the Depositary or to a successor Depositary or its nominee. Owners of beneficial interests in such a Global Security will not be considered the Holders thereof for any purpose under the Indenture, and no Global Security representing a Senior Note shall be exchangeable, except for another Global Security of like denomination and tenor to be registered in the name of the Depositary or its nominee or to a successor Depositary or its nominee or except as described below. The rights of Holders of such Global Security shall be exercised only through the Depositary. A Global Security shall be exchangeable for Senior Notes registered in the names of persons other than the Depositary or its nominee only if (i) the Depositary notifies the Company that it is unwilling or unable to continue as a Depositary for such Global Security and no successor Depositary shall have been appointed by the Company within 90 days of receipt by the Company of such notification, or if at any time the Depositary ceases to be a clearing agency registered under the Exchange Act at a time when the Depositary is required to be so registered to act as such Depositary and no successor Depositary shall have been appointed by the Company within 90 days after it becomes aware of such cessation, or (ii) the Company in its sole discretion determines that such Global Security shall be so exchangeable. Any Global Security that is exchangeable pursuant to the preceding sentence shall be exchangeable for Senior Notes registered in such names as the Depositary shall direct. SECTION 106. Remarketing. The Pledged Senior Notes comprising part of ----------- Corporate Units and the Separated Senior Notes of holders of Separated Senior Notes that have elected to participate in the Remarketing shall be remarketed by the Remarketing Agent on the Remarketing Date. All Holders of Pledged Senior Notes that fail to settle the related Purchase Contract through a Cash Settlement or an Early Settlement pursuant to Section 5.9 of the Purchase Contract Agreement thereof shall be deemed to have consented to the disposition of the Pledged Senior Note pursuant to the Remarketing. Each holder of Separated Senior Notes may elect to have all or a portion of its Senior Notes remarketed by notifying the Trustee and the Collateral Agent of the aggregate principal amount of Separated Senior Notes that it wishes to have remarketed prior to 5:00 p.m. (New York City time) on the Election Date. Any notice pursuant to the preceding sentence shall be substantially in the form of Exhibit H to the Purchase Contract Agreement and shall be irrevocable and may not be conditioned upon the level at which the Reset Rate is established in the Remarketing. Concurrently with the giving of such notice, the holder of Separated Senior Notes, all or a portion of which is to be remarketed, shall deliver or cause such Separated Senior Notes to be delivered to the Collateral Agent. If the holder of the Separated Senior Notes delivers only such notice but not the Separated Senior Notes subject to the Notice, then none of such holder's Separated Senior Notes shall be included in the Remarketing. Once the holder of Separated Senior Notes elects to participate in the Remarketing, such Separated Senior Notes will be remarketed in the Initial Remarketing, any Subsequent Remarketing and the Final Remarketing, as applicable. On the seventh Business Day prior to the Initial Remarketing Date, the Company shall give notice of Remarketing in an Authorized Newspaper, including the specific U.S. Treasury 7 security or securities (including the CUSIP number and/or the principal terms of such Treasury security or securities) that must be delivered by Holders of Corporate Units that elect not to participate in the Remarketing pursuant to Section 5.4(f) of the Purchase Contract Agreement, no later than 5:00 p.m. (New York City time) on the Election Date. Not later than 15 nor more than 30 calendar days prior to the Initial Remarketing Date, the Company shall request the Depositary (or any successor Clearing Agency) to notify, directly or indirectly, each Beneficial Owner or Clearing Agency Participant holding Corporate Units and each Beneficial Owner of a Senior Note not a part of a Corporate Unit of the Remarketing and of the procedures that must be followed in connection with the Remarketing. The Purchase Contract Agent shall notify, by 11:00 a.m. (New York City time), on the Business Day immediately preceding the Initial Remarketing Date, the Remarketing Agent, the Collateral Agent, the Trustee and the Company, by use of a notice substantially in the form of Exhibit G of the Purchase Contract Agreement, of the aggregate principal amount of Pledged Senior Notes of Corporate Units Holders to be remarketed on the Initial Remarketing Date or Subsequent Remarketing Date, as applicable, and the Collateral Agent, pursuant to the Pledge Agreement, having separately notified the Remarketing Agent, the Trustee and the Company of the aggregate principal amount of Separated Senior Notes to be included on the Initial Remarketing Date or any Subsequent Remarketing Date, as applicable, by 11:00 a.m. (New York City time), on the Business Day immediately preceding the Initial Remarketing Date, shall concurrently therewith, pursuant to the Pledge Agreement, deliver for Remarketing to the Remarketing Agent all Remarketing Senior Notes. Upon receipt of such notice from the Purchase Contract Agent and the Collateral Agent and such Remarketing Senior Notes from the Collateral Agent, the Remarketing Agent, pursuant to the Remarketing Agreement, will use its commercially reasonable efforts to remarket such Remarketing Senior Notes on such date pursuant to the Remarketing Procedures and the Remarketing Agreement. The right of each Holder of Senior Notes to have its Senior Notes tendered for purchase will be limited to the extent that (i) the Remarketing Agent conducts a Remarketing pursuant to the terms of the Remarketing Agreement, (ii) the Remarketing Agent is able to find a purchaser or purchasers for the tendered Senior Notes and (iii) such purchaser or purchasers deliver the purchase price therefor to the Remarketing Agent. If there has been a Successful Initial Remarketing or a Successful Subsequent Remarketing, the Remarketing Agent will on the Remarketing Settlement Date: (i) deduct and retain for itself the Remarketing Fee; (ii) use the remaining proceeds attributable to the Pledged Senior Notes from such Successful Remarketing to purchase the Treasury Portfolio described in clauses 1(i) and 2(i) of the definition of Remarketing Value related to the Senior Notes of Holders of Corporate Units that were remarketed; 8 (iii) if any Separated Senior Notes were remarketed, remit to the Collateral Agent for payment to the holders of such Separated Senior Notes the amounts specified in clauses 1(ii) and 2(ii) of the definition of Remarketing Value; and (iv) if there then remain any proceeds from the Successful Remarketing, after the application of such proceeds as set forth in clauses (i) through (iii) above, then remit any such remaining proceeds to the Purchase Contract Agent for the benefit of holders of the remarketed Senior Notes and to the Collateral Agent for the benefit of the holders of such Separated Senior Notes, on a pro rata basis, provided, however, that if such Successful Remarketing is consummated after 4:30 p.m. (New York City time) on the Remarketing Date and, despite using its commercially reasonable efforts, the Remarketing Agent cannot cause the applications of the proceeds specified above to occur on the Remarketing Settlement Date, then the Remarketing Agent may make such applications and remittances on the next succeeding Business Day. If a Successful Final Remarketing shall have occurred, the Remarketing Agent will on the Remarketing Settlement Date or Purchase Contract Settlement Date, as applicable, (i) deduct and retain for itself the Remarketing Fee, (ii) cause the remaining proceeds of the Remarketing with respect to the Pledged Senior Notes in an amount equal to the aggregate principal amount of such Senior Notes to be delivered to the Collateral Agent, on the Remarketing Settlement Date, (iii) if any Separated Senior Notes were remarketed, remit to the Collateral Agent for payment to the holders of such Separated Senior Notes sold in the Remarketing the remaining proceeds from such Successful Remarketing attributable to the Separated Senior Notes in an amount equal to the principal amount of such Senior Notes and (iv) if there remain any proceeds from such Successful Remarketing, after the application of such proceeds as set forth in clauses (i) through (iii) of this sentence, then remit such remaining proceeds to the Purchase Contract Agent for the benefit of the holders of the Pledged Senior Notes and to the Collateral Agent for the benefit of holders of Separated Senior Notes, on a pro rata basis, provided, however, that if the Successful Final Remarketing is consummated after 4:30 p.m. (New York City time) on the Remarketing Date and, despite using its commercially reasonable efforts, the Remarketing Agent cannot cause the application of the proceeds specified above to occur on the Remarketing Settlement Date, then the Remarketing Agent may make such applications and remittances on the next succeeding Business Day. If a Successful Remarketing occurs, by approximately 4:30 p.m. (New York City time) on the Remarketing Date, the Remarketing Agent shall advise, by telephone (promptly confirmed in writing in the case of clause (i)): (i) the Company, the Purchase Contract Agent, the Collateral Agent, the Securities Intermediary, the Depositary, and the Trustee of the Reset Rate determined in the Remarketing; (ii) each purchaser (or the Depositary Participant thereof) of Senior Notes in the Remarketing of the Reset Rate and the number of Senior Notes such purchaser is to purchase; and 9 (iii) each purchaser to give instructions to its Depositary Participant to pay the purchase price on the Remarketing Settlement Date in same day funds against delivery of the Remarketed Senior Notes purchased through the facilities of the Depositary. If a Failed Remarketing occurs, the Remarketing Agent and the Company, as applicable, shall take the following actions: (i) The Remarketing Agent shall notify by telephone the Company, the Purchase Contract Agent, the Collateral Agent and the Trustee, that a Failed Remarketing has occurred, whereupon the Company shall notify the Clearing Agency, by telephone, that a Failed Remarketing has occurred. (ii) The Company shall cause a notice of the Failed Remarketing to be sent to the holders of all Senior Notes and to be published in an Authorized Newspaper in New York City, in each case, no later than the Business Day immediately preceding Purchase Contract Settlement Date. (iii) The Remarketing Agent shall determine the Reset Rate in accordance with clause (ii) of the Reset Rate definition. (iv) The Remarketing Agent shall remit the Pledged Senior Notes that were to be remarketed and the Separated Senior Notes that were to be remarketed to the Collateral Agent. Notwithstanding anything herein to the contrary, the Reset Rate shall in no event exceed the maximum rate, if any, permitted by applicable law. In accordance with the Depositary's normal procedures, on the Remarketing Settlement Date or the Purchase Contract Settlement Date, as applicable, the transactions described above with respect to each Senior Notes remarketed in the Remarketing shall be executed through the Depositary, and the accounts of the respective Depositary Participants shall be debited and credited and such Remarketed Senior Notes delivered by book entry as necessary to effect purchases and sales of such Remarketed Senior Notes. The Depositary shall make payment in accordance with its normal procedures. If any Holder of Senior Notes selling Senior Notes in the Remarketing fails to deliver such Senior Notes, the direct or indirect Depositary Participant of such selling Holder and of any other Person who was to have purchased Senior Notes in the Remarketing may deliver to any such other Person an aggregate principal amount of Senior Notes that is less than the aggregate principal amount of Senior Notes that otherwise was to be purchased by such Person. In such event, the aggregate principal amount of Senior Notes to be so delivered shall be determined by such direct or indirect Depositary Participant, and delivery of such lesser aggregate principal amount of Senior Notes shall constitute good delivery. The Remarketing Agent is not obligated to purchase any Senior Notes that otherwise would remain unsold in the Remarketing. Neither the Company nor the Remarketing Agent shall be obligated in any case to provide funds to make payment upon tender of the Senior Notes for Remarketing. 10 Under the Remarketing Agreement, the Company, in its capacity as issuer of the Senior Notes, shall be liable for, and shall pay, any and all costs and expenses incurred in connection with the Remarketing, other than the Remarketing Fee. The settlement procedures set forth herein, including provisions for payment by purchasers of the Remarketed Senior Notes in the Remarketing, shall be subject to modification to the extent required by the Depositary or if the book-entry system is no longer available for the Remarketed Senior Notes at the time of the Remarketing, to facilitate the remarketing of the Remarketed Senior Notes in certificated form, and shall provide for the authentication and delivery of Senior Notes in a principal amount equal to the unremarketed portion of such Senior Notes. In addition, the Remarketing Agent may modify the settlement procedures set forth herein in order to facilitate the settlement process. SECTION 107. Sinking Fund. The Senior Notes shall not have a sinking fund. ------------ SECTION 108. Additional Interest. Any principal of and installment of ------------------- interest on the Senior Notes that is overdue shall bear interest at the rate of 5.75% (to the extent that the payment of such interest shall be legally enforceable), from the dates such amounts are due until they are paid or made available for payment, and such interest shall be payable on demand. SECTION 109. Paying Agent. The Trustee shall initially serve as Paying ------------ Agent with respect to the Senior Notes, with the Place of Payment initially being the Corporate Trust Office of the Trustee. SECTION 110. Limitation on Liens. The Company will not, while any of the ------------------- Senior Notes remain Outstanding, create, or suffer to be created or to exist, any Lien upon any Principal Property of the Company or upon any shares of stock of any Material Subsidiary of the Company, whether such Principal Property is, or shares of stock are, now owned or hereafter acquired, to secure any indebtedness for borrowed money of the Company, unless it shall make effective provision whereby the Senior Notes then Outstanding shall be secured by such Lien equally and ratably with any and all indebtedness for borrowed money thereby secured so long as any such indebtedness shall be so secured; provided, however, that nothing in this Section shall be construed to prevent the Company from creating, or from suffering to be created or to exist, any Liens, or any agreements, with respect to: (1) purchase money mortgages, or other purchase money liens, pledges, security interests or encumbrances of any kind upon property hereafter acquired by the Company, or Liens of any kind existing on any property or any shares of stock at the time of the acquisition thereof (including Liens which exist on any property or any shares of stock of a Person which is consolidated with or merged with or into the Company or which transfers or leases all or substantially all of its properties to the Company), or conditional sales agreements or other title retention agreements and leases in the nature of title retention agreements with respect to any property hereafter acquired; provided, however, that no such Lien shall extend to or cover any other property of the Company; 11 (2) Liens upon any property of the Company or any shares of stock of any Material Subsidiary of the Company existing as of the date of the initial issuance of the Senior Notes or upon the shares of stock of any corporation, which Liens existed at the time such corporation became a Material Subsidiary of the Company; liens for taxes or assessments or other governmental charges or levies; pledges to secure other governmental charges or levies; pledges or deposits to secure obligations under worker's compensation laws, unemployment insurance and other social security legislation, including liens of judgments thereunder which are not currently dischargeable; pledges or deposits to secure performance in connection with bids, tenders, contracts (other than contracts for the payment of money) or leases to which the Company is a party; pledges or deposits to secure public or statutory obligations of the Company; builders', materialmen's, mechanics', carriers', warehousemen's, workers', repairmen's, operators', landlords' or other like liens in the ordinary course of business, or deposits to obtain the release of such liens; pledges or deposits to secure, or in lieu of, surety, stay, appeal, indemnity, customs, performance or return-of-money bonds; other pledges or deposits for similar purposes in the ordinary course of business; liens created by or resulting from any litigation or proceeding which at the time is being contested in good faith by appropriate proceedings; liens incurred in connection with the issuance of bankers' acceptances and lines of credit, bankers' liens or rights of offset and any security given in the ordinary course of business to banks or others to secure any indebtedness payable on demand or maturing within 12 months of the date that such indebtedness is originally incurred; liens incurred in connection with repurchase, swap or other similar agreements (including, without limitation, commodity price, currency exchange and interest rate protection agreements); leases made, or existing on property acquired, in the ordinary course of business; liens securing industrial revenue or pollution control bonds; liens, pledges, security interests or other encumbrances on any property arising in connection with any defeasance, covenant defeasance or in-substance defeasance of indebtedness of the Company, including the Senior Notes; liens created in connection with, and created to secure, a non-recourse obligation; zoning restrictions, easements, licenses, rights-of-way, restrictions on the use of property or minor irregularities in title thereto, which do not, in the opinion of the Company, materially impair the use of such property in the operation of the business of the Company or the value of such property for the purpose of such business; (3) Liens in favor of the United States, any foreign country or any department, agency or instrumentality or political subdivision of any such jurisdiction, to secure partial, progress, advance or other payments pursuant to any contract or statute or to secure any indebtedness incurred for the purpose of financing all or any part of the purchase price or the cost of constructing or improving the property subject to such mortgages, including, without limitation, mortgages to secure indebtedness of the pollution control or industrial revenue bond type; (4) indebtedness which may be issued by the Company in connection with a consolidation or merger of the Company or any Material Subsidiary of the 12 Company with or into any other Person (which may be an Affiliate of the Company or any Material Subsidiary of the Company) in exchange for or otherwise in substitution for secured indebtedness of such Person ("Third Party Debt") which by its terms (i) is secured by a mortgage on all or a portion of the property of such Person, (ii) prohibits secured indebtedness from being incurred by such Person, unless the Third Party Debt shall be secured equally and ratably with such secured indebtedness or (iii) prohibits secured indebtedness from being incurred by such Person; (5) indebtedness of any Person which is required to be assumed by the Company in connection with a consolidation or merger of such Person, with respect to which any property of the Company is subjected to a Lien; (6) Liens of any kind upon any property acquired, constructed, developed or improved by the Company (whether alone or in association with others) after the date of the initial issuance of the Senior Notes which are created prior to, at the time of, or within 18 months after such acquisition (or in the case of property constructed, developed or improved, after the completion of such construction, development or improvement and commencement of full commercial operation of such property, whichever is later) to secure or provide for the payment of any part of the purchase price or cost thereof; provided that in the case of such construction, development or improvement the Liens shall not apply to any property theretofore owned by the Company other than theretofore unimproved real property; (7) Liens in favor of the Company, one or more Material Subsidiaries of the Company, one or more wholly-owned Subsidiaries of the Company or any of the foregoing in combination; (8) the replacement, extension or renewal (or successive replacements, extensions or renewals), as a whole or in part, of any Lien, or of any agreement, referred to above in clauses (1) through (7) inclusive, or the replacement, extension or renewal (not exceeding the principal amount of indebtedness secured thereby together with any premium, interest, fee or expense payable in connection with any such replacement, extension or renewal) of the indebtedness secured thereby; provided that such replacement, extension or renewal is limited to all or a part of the same property that secured the Lien replaced, extended or renewed (plus improvements thereon or additions or accessions thereto); or (9) any other Lien not excepted by the foregoing clauses (1) through (8); provided that immediately after the creation or assumption of such Lien, the aggregate principal amount of indebtedness for borrowed money of the Company secured by all Liens created or assumed under the provisions of this clause (9) shall not exceed an amount equal to 10% of the common shareholders' equity of the Company, as shown on its consolidated balance sheet for the accounting period occurring immediately prior to the creation or assumption of such Lien. 13 This Section 110 has been included in this Tenth Supplemental Indenture expressly and solely for the benefit of the Senior Notes and shall be subject to covenant defeasance pursuant to Section 402(3) of the Original Indenture. SECTION 111. Tax Event Redemption. If a Tax Event shall occur and be -------------------- continuing, the Company may, at its option, redeem the Senior Notes in whole (but not in part) at any time at a price per Senior Note equal to the Redemption Price (as defined in the Purchase Contract Agreement). Installments of interest on the Senior Notes which are due and payable on or prior to the date of redemption (the "Tax Event Redemption Date") will be payable to the Holders of the Senior Notes registered as such at the close of business on the Regular Record Date for such interest payment. If the Company exercises its option to redeem the Senior Notes following the occurrence of a Tax Event prior to the Initial Remarketing Date, or if there has not been a Successful Initial Remarketing or a Successful Subsequent Remarketing, prior to the Purchase Contract Settlement Date, the Company shall in the notice to the Trustee pursuant to Section 105 of the Original Indenture specify the Redemption Price. Upon the specification of the Redemption Price by the Company, the Company shall appoint the Quotation Agent to assemble the Redemption Treasury Portfolio in consultation with the Company. The Collateral Agent shall then apply, out of the aggregate Redemption Price for the Pledged Senior Notes, an amount equal to the aggregate Redemption Amount for the Pledged Senior Notes to purchase on behalf of the Holders of Corporate Units the Redemption Treasury Portfolio and promptly remit the remaining portion, if any, of such Redemption Price to the Purchase Contract Agent for payment to the Holders of such Corporate Units. The Redemption Treasury Portfolio will be substituted for the Pledged Senior Notes, and will be held by the Collateral Agent in accordance with the terms of the Pledge Agreement to secure the obligation of each Holder of a Corporate Unit to purchase Common Stock of the Company under the Purchase Contract constituting a part of such Corporate Unit. If a Tax Event Redemption occurs after the Remarketing Settlement Date or the Purchase Contract Settlement Date, payment of the Redemption Price to each Holder of Senior Notes shall be made by the Trustee (subject to its receipt of funds), no later than 12:00 noon, New York City time, on the Tax Event Redemption Date, by check or wire transfer in immediately available funds (provided the necessary wire instructions have been provided to the Trustee at least 15 days prior to the Tax Event Redemption Date) at such place and to such account as may be designated by each such Holder of Senior Notes, including the Collateral Agent. If the Trustee holds immediately available funds sufficient to pay the Redemption Price of the Senior Notes, then, on such Tax Event Redemption Date, such Senior Notes will cease to be Outstanding. The Trustee shall have no duty or liability to determine or verify the Redemption Price. Notice of any redemption will be mailed at least 20 days but not more than 60 days before the Tax Event Redemption Date to each registered Holder of the Senior Notes to be repaid at its registered address. Unless the Company defaults in payment of the Redemption Price, on and after the Tax Event Redemption Date interest shall cease to accrue on the Senior Notes, whether or not such Senior Notes have been received by the Company, and all other rights of the Holders in respect of the Senior Notes shall terminate and lapse (other than the right to receive the 14 Redemption Price upon delivery of such Senior Notes but without interest on such Redemption Price). SECTION 112. Tax Treatment. The Company agrees, and by purchasing a ------------- beneficial ownership interest in the Senior Notes each Holder of the Senior Notes will be deemed to have agreed, for United States federal income tax purposes (i) to treat the acquisition of a Corporate Unit as the acquisition of a unit consisting of a stock purchase contract and a note issued by the Company and to treat the Senior Notes as indebtedness that is subject to Treas. Reg. Sec. 1.1275-4 (the "Contingent Payment Regulations") and (ii) to be bound by the Company's determination of the "comparable yield" and "projected payment schedule" within the meaning of the Contingent Payment Regulations, with respect to the Senior Notes. The Company has determined that the comparable yield is an annual rate of 6.364% compounded quarterly. Based on the comparable yield, the projected payment schedule per Senior Note is $0.44 for the period ending on May 15, 2002; $0.72 for each subsequent quarter ending on or prior to the Initial Remarketing Date; $0.98 for each quarter ending after the Initial Remarketing Date; and $50.98 at maturity. 15 ARTICLE II MISCELLANEOUS PROVISIONS SECTION 201. Recitals by Company. The recitals in this Tenth Supplemental ------------------- Indenture are made by the Company only and not by the Trustee, and all of the provisions contained in the Original Indenture in respect of the rights, privileges, immunities, powers and duties of the Trustee shall be applicable in respect of the Senior Notes and of this Tenth Supplemental Indenture as fully and with like effect as if set forth herein in full. SECTION 202. Ratification and Incorporation of Original Indenture. As ---------------------------------------------------- supplemented hereby, the Original Indenture is in all respects ratified and confirmed, and the Original Indenture and this Tenth Supplemental Indenture shall be read, taken and construed as one and the same instrument. SECTION 203. Executed in Counterparts. This Supplemental Indenture may be ------------------------ executed in several counterparts, each of which shall be deemed to be an original, and such counterparts shall together constitute but one and the same instrument. SECTION 204. Assignment. The Company shall have the right at all times to ---------- assign any of its rights or obligations under the Indenture with respect to the Senior Notes to a direct or indirect wholly-owned subsidiary of the Company; provided that, in the event of any such assignment, the Company shall remain primarily liable for the performance of all such obligations. The Indenture may also be assigned by the Company in connection with a transaction described in Article Eight of the Original Indenture. 16 IN WITNESS WHEREOF, each party hereto has caused this instrument to be signed in its name and behalf by its duly authorized officer, all as of the day and year first above written. DOMINION RESOURCES, INC. By: ___________________________________ Name: _________________________________ Title: ________________________________ JPMORGAN CHASE BANK, as Trustee By: ___________________________________ Name: _________________________________ Title: ________________________________ 17 EXHIBIT A FORM OF 2002 SERIES A 5.75% SENIOR NOTE, DUE MAY 15, 2008 [UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY (55 WATER STREET, NEW YORK, NEW YORK) TO THE ISSUER OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF [CEDE & CO.] OR SUCH OTHER NAME AS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY AND ANY PAYMENT IS MADE TO [CEDE & CO.], ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL SINCE THE REGISTERED OWNER HEREOF, [CEDE & CO.,] HAS AN INTEREST HEREIN.]** [THIS SERIES A SENIOR NOTE IS A GLOBAL SECURITY WITHIN THE MEANING OF THE INDENTURE HEREINAFTER REFERRED TO AND IS REGISTERED IN THE NAME OF A DEPOSITARY OR A NOMINEE THEREOF. THIS SERIES A SENIOR NOTE MAY NOT BE EXCHANGED IN WHOLE OR IN PART FOR A SECURITY REGISTERED, AND NO TRANSFER OF THIS SERIES A SENIOR NOTE IN WHOLE OR IN PART MAY BE REGISTERED, IN THE NAME OF ANY PERSON OTHER THAN SUCH DEPOSITARY OR A NOMINEE THEREOF, EXCEPT IN THE LIMITED CIRCUMSTANCES DESCRIBED IN THE INDENTURE.]** ===================================== DOMINION RESOURCES, INC. ===================================== $ 2002 SERIES A 5.75% SENIOR NOTE, DUE MAY 15, 2008 No. CUSIP No. 25746U AH 2 Dominion Resources, Inc., a corporation duly organized and existing under the laws of Virginia (herein called the "Company", which term includes any successor Person under the Indenture hereinafter referred to), for value received, hereby promises to pay to [Cede & Co.] **, or registered assigns (the "Holder"), the principal sum of ____________ Dollars ($_____)[, or such other principal amount as shall be set forth in the Schedule of Increases or Decreases attached hereto,]*** on May 15, 2008 and to pay interest thereon from March 20, 2002 or from the most recent Interest Payment Date to which interest has been paid or duly provided for, quarterly in arrears __________________ ** Insert in Global Securities. *** Insert in Global Securities and Pledged Senior Notes. on February 15, May 15, August 15 and November 15 of each year, commencing on May 15, 2002, at the rate of 5.75% per annum to, but excluding, the earlier of (i) the Remarketing Settlement Date or (ii) the Purchase Contract Settlement Date, and, thereafter, at the Reset Rate to, but excluding, the Stated Maturity of the Senior Notes. The interest so payable, and punctually paid or duly provided for, on any Interest Payment Date will, as provided in such Indenture, be paid to the Person in whose name this Senior Note (or one or more Predecessor Securities) is registered at the close of business on the Regular Record Date for such interest, which shall be the close of business on the Business Day preceding such Interest Payment Date; provided that interest payable at the Stated Maturity of principal will be paid to the Person to whom principal is payable. With respect to Senior Notes that are not in book-entry only form, the Regular Record Date shall be the close of business on the 15/th/ Business Day preceding such Interest Payment Date. Any such interest not so punctually paid or duly provided for will forthwith cease to be payable to the Holder on such Regular Record Date and may either be paid to the Person in whose name this Senior Note (or one or more Predecessor Securities) is registered at the close of business on a Special Record Date for the payment of such Defaulted Interest to be fixed by the Trustee, notice whereof shall be given to Holders of Senior Notes not less than 10 days prior to such Special Record Date, or be paid at any time in any other lawful manner not inconsistent with the requirements of any securities exchange on which the Senior Notes may be listed, and upon such notice as may be required by such exchange, all as more fully provided in said Indenture. Payments of interest on the Senior Notes will include interest accrued to but excluding the respective Interest Payment Dates. Interest payments for the Senior Notes shall be computed and paid (1) for any full quarterly period on the basis of a 360-day year of twelve 30-day months, (2) for any period shorter than a full quarterly period, on the basis of a 30-day month and (3) for any period less than a month, on the basis of the actual number of days elapsed per 30-day month. In the event that any date on which interest is payable on the Senior Notes is not a Business Day, then payment of the interest payable on such date will be made on the next succeeding day that is a Business Day (and without any interest or payment in respect of any such delay), in each case with the same force and effect as if made on the date the payment was originally payable. However, if such Business Day is in the next calendar year, then such payment will be made on the preceding Business Day. Payment of the principal of and interest on this Senior Note will be made at the office of the Paying Agent, in the Borough of Manhattan, City and State of New York, in such coin or currency of the United States of America as at the time of payment is legal tender for payment of public and private debts, with any such payment that is due at the Stated Maturity of any Senior Note being made upon surrender of such Senior Note to such office or agency; provided, however, that at the option of the Company payment of interest, subject to such surrender where applicable, may be made (i) by check mailed to the address of the Person entitled thereto as such address shall appear in the Security Register or (ii) by wire transfer at such place and to such account at a banking institution in the United States as may be designated in writing to the Trustee at least sixteen (16) days prior to the date for payment by the Person entitled thereto. Reference is hereby made to the further provisions of this Senior Note set forth on the reverse hereof, which further provisions shall for all purposes have the same effect as if set forth at this place. 2 Unless the certificate of authentication hereon has been executed by the Trustee referred to on the reverse hereof by manual signature, this Senior Note shall not be entitled to any benefit under the Indenture or be valid or obligatory for any purpose. IN WITNESS WHEREOF, the Company has caused this instrument to be duly executed. Dated: Dominion Resources, Inc. By: ___________________________________ Name: _________________________________ Title: ________________________________ 3 CERTIFICATE OF AUTHENTICATION This is one of the Securities of the series designated therein referred to in the within-mentioned Indenture. JPMORGAN CHASE BANK, as Trustee By: ________________________________ Authorized Officer 4 [REVERSE OF SERIES A SENIOR NOTE] This Security is one of a duly authorized issue of securities of the Company (herein called the "Securities"), issued and to be issued in one or more series under an Indenture, dated as of June 1, 2000, as heretofore supplemented and amended and as further supplemented by a Tenth Supplemental Indenture dated as of March 20, 2002 (collectively, as amended or supplemented from time to time, herein called the "Indenture", which term shall have the meaning assigned to it in such instrument), between the Company and JPMorgan Chase Bank (formerly known as The Chase Manhattan Bank), as Trustee (herein called the "Trustee", which term includes any successor trustee under the Indenture), and reference is hereby made to the Indenture for a statement of the respective rights, limitations of rights, duties and immunities thereunder of the Company, the Trustee and the Holders of the Securities and of the terms upon which the Securities are, and are to be, authenticated and delivered. This Security is one of the series designated on the face hereof (the "Senior Notes") which is limited in aggregate principal amount to $300,000,000 (subject to increase to $330,000,000 if the related overallotment option is exercised in full). The Reset Rate shall be equal to the rate per annum that results from: (i) in connection with a Successful Remarketing, the interest rate determined by the Remarketing Agent sufficient to allow it to remarket the Remarketing Senior Notes at a price at least equal to the Remarketing Value; (ii) upon the occurrence of a Failed Remarketing, the Two-Year Benchmark Rate plus the Applicable Spread; or (iii) if (a) there are no Pledged Senior Notes to be remarketed and (b) none of the holders of Separated Senior Notes have elected to have their Senior Notes remarketed in accordance with Section 106 hereof and Section 5.7 of the Pledge Agreement, the Reset Rate shall be the rate determined, in its sole discretion, by the Remarketing Agent, as the rate that, in its judgment, would have been established had a Remarketing been held on the Final Remarketing Date. The term "Two-Year Benchmark Rate" shall mean the bid side rate displayed at 10:00 a.m. (New York City time) on the third Business Day preceding the Purchase Contract Settlement Date for direct obligations of the United States having a maturity comparable to the remaining term to the Stated Maturity of the Senior Notes, as agreed upon by the Company and the Remarketing Agent as displayed in the Telerate system or, if the Telerate system is no longer available or, in the judgment of the Remarketing Agent (after consultation with the Company), no longer an appropriate system from which to obtain such rate, such other nationally recognized quotation system as, in the judgment of the Remarketing Agent (after consultation with the Company) is appropriate. If this rate is not so displayed, the Two-Year Benchmark Rate will be calculated by the Remarketing Agent as the yield to maturity for direct obligations of the United States having a maturity comparable to the remaining term to the Stated Maturity of the Senior Notes, expressed as a bond equivalent on the basis of a year of 365 or 366 days, as applicable, and applied on a daily basis, and computed by taking the arithmetic mean of the secondary market bid rates, as of 10:30 a.m. (New York City time) on the third Business Day preceding the Purchase Contract Settlement Date of three leading United States government securities dealers selected by the Remarketing Agent (after consultation with the Company) (which may include the Remarketing Agent or an Affiliate thereof). However, if, in the judgment of the 5 Remarketing Agent, after consultation with the Company, direct obligations of the United States are no longer appropriate benchmarks for the purpose of setting the Reset Rate if a Failed Remarketing has occurred, the Remarketing Agent and the Company will agree upon another Two-Year Benchmark Rate. The term "Applicable Spread" shall mean the spread determined as set forth below, based on the Prevailing Rating of the Senior Notes in effect at the close of business on the Business Day immediately preceding the date of the Failed Remarketing: Prevailing Rating Spread ----------------- ------ AA/"Aa2" ......................................... 3.00% A/"A2" ........................................... 4.00% BBB/"Baa2" ....................................... 5.00% Below BBB/"Baa2" ................................. 7.00% For purposes of this definition, the term "Prevailing Rating" of the Senior Notes shall mean: (w) AA/"Aa2" if the Senior Notes have a credit rating of AA or better by Standard & Poor's Ratings Services ("S&P") and "Aa2" or better by Moody's Investors Service, Inc. ("Moody's") or the equivalent of such ratings by such agencies or a substitute rating agency or substitute rating agencies selected by the Remarketing Agent; (x) if not under clause (w) above, then A/"A2" if the Senior Notes have a credit rating of A or better by S&P and "A2" or better by Moody's or the equivalent of such ratings by such agencies or a substitute rating agency or substitute rating agencies selected by the Remarketing Agent; (y) if not under clauses (w) or (x) above, then BBB/"Baa2" if the Senior Notes have a credit rating of BBB or better by S&P and "Baa2" or better by Moody's or the equivalent of such ratings by such agencies or a substitute rating agency or substitute rating agencies selected by the Remarketing Agent; or (z) if not under clauses (w), (x) or (y) above, then Below BBB/"Baa2". Notwithstanding the foregoing, (A) if (i) the credit rating of the Senior Notes by S&P shall be on the "Credit Watch" of S&P with a designation of "negative implications" or "developing", or (ii) the credit rating of the Senior Notes by Moody's shall be on the "Corporate Credit Watch List" of Moody's with a designation of "downgrade" or "uncertain", or, in each case, on any successor list of S&P or Moody's with a comparable designation, the Prevailing Ratings of the Senior Notes shall be deemed to be within a range one full level lower in the above table than those actually assigned to the Senior Notes by S&P and Moody's and (B) if the Senior Notes are rated by only one rating agency prior to or on the Remarketing Date, the Prevailing Rating shall at all times be determined without reference to the rating of any other rating agency; provided that if no such rating agency shall have in effect a rating for the Senior Notes and the Remarketing Agent is unable to identify a substitute rating agency or rating agencies, the Prevailing Rating shall be below BBB/"Baa2". 6 The Senior Notes shall not be entitled to any sinking fund and shall not be redeemable prior to Stated Maturity. If an Event of Default with respect to Senior Notes shall occur and be continuing, the principal of the Senior Notes may be declared due and payable in the manner and with the effect provided in the Indenture. The Pledged Senior Notes comprising part of Corporate Units and the Separated Senior Notes of holders of Separated Senior Notes that have elected to participate in the Remarketing shall be remarketed by the Remarketing Agent on the Remarketing Date. All Holders of Pledged Senior Notes that fail to settle the related Purchase Contract through a Cash Settlement or an Early Settlement pursuant to Section 5.9 of the Purchase Contract Agreement thereof shall be deemed to have consented to the disposition of the Pledged Senior Note pursuant to the Remarketing. Each holder of Separated Senior Notes may elect to have all or a portion of its Senior Notes remarketed by notifying the Trustee and the Collateral Agent of the aggregate principal amount of Separated Senior Notes that it wishes to have remarketed prior to 5:00 p.m. (New York City time) on the Election Date. Any notice pursuant to the preceding sentence shall be substantially in the form of Exhibit H to the Purchase Contract Agreement and shall be irrevocable and may not be conditioned upon the level at which the Reset Rate is established in the Remarketing. Concurrently with the giving of such notice, the holder of Separated Senior Notes, all or a portion of which is to be remarketed, shall deliver or cause such Separated Senior Notes to be delivered to the Collateral Agent. If the holder of the Separated Senior Notes delivers only such notice but not the Separated Senior Notes subject to the Notice, then none of such holder's Separated Senior Notes shall be included in the Remarketing. Once the holder of Separated Senior Notes elects to participate in the Remarketing, such Separated Senior Notes will be remarketed in the Initial Remarketing, the Subsequent Remarketing and the Final Remarketing, as applicable. On the seventh Business Day prior to the Initial Remarketing Date, the Company shall give notice of Remarketing in an Authorized Newspaper, including the specific U.S. Treasury security or securities (including the CUSIP number and/or the principal terms of such Treasury security or securities) that must be delivered by Holders of Corporate Units that elect not to participate in the Remarketing pursuant to Section 5.4(f) of the Purchase Contract Agreement, no later than 5:00 p.m. (New York City time) on the Election Date. Not later than 15 nor more than 30 calendar days prior to the Initial Remarketing Date, the Company shall request the Depositary (or any successor Clearing Agency) to notify, directly or indirectly, each Beneficial Owner or Clearing Agency Participant holding Corporate Units and each Beneficial Owner of a Senior Note not a part of a Corporate Unit of the Remarketing and of the procedures that must be followed in connection with the Remarketing. The Purchase Contract Agent shall notify, by 11:00 a.m. (New York City time), on the Business Day immediately preceding the Initial Remarketing Date, the Remarketing Agent, the Collateral Agent, the Trustee and the Company, by use of a notice substantially in the form of Exhibit G of the Purchase Contract Agreement, of the aggregate principal amount of Pledged Senior Notes of Corporate Units Holders to be remarketed on the Initial Remarketing Date or Subsequent Remarketing Date, as applicable, and the Collateral Agent, pursuant to the Pledge Agreement, having separately notified the Remarketing Agent, the Trustee and the Company of the aggregate principal amount of Separated Senior Notes to be included on the Initial Remarketing Date or Subsequent Remarketing Date, as applicable, by 11:00 a.m. (New York City time), on the Business Day 7 immediately preceding the Initial Remarketing Date, shall concurrently therewith, pursuant to the Pledge Agreement, deliver for Remarketing to the Remarketing Agent all Remarketing Senior Notes. Upon receipt of such notice from the Purchase Contract Agent and the Collateral Agent and such Remarketing Senior Notes from the Collateral Agent, the Remarketing Agent, pursuant to the Remarketing Agreement, will use its commercially reasonable efforts to remarket such Remarketing Senior Notes on such date pursuant to the Remarketing Procedures and the Remarketing Agreement. The right of each Holder of Senior Notes to have its Senior Notes tendered for purchase will be limited to the extent that (i) the Remarketing Agent conducts a Remarketing pursuant to the terms of the Remarketing Agreement, (ii) the Remarketing Agent is able to find a purchaser or purchasers for the tendered Senior Notes and (iii) such purchaser or purchasers deliver the purchase price therefor to the Remarketing Agent. If there has been a Successful Initial Remarketing or a Successful Subsequent Remarketing, the Remarketing Agent will on the Remarketing Settlement Date: (i) deduct and retain for itself the Remarketing Fee; (ii) use the remaining proceeds attributable to the Pledged Senior Notes from such Successful Remarketing to purchase the Treasury Portfolio described in clauses 1(i) and 2(i) of the definition of Remarketing Value related to the Senior Notes of Holders of Corporate Units that were remarketed; (iii) if any Separated Senior Notes were remarketed, remit to the Collateral Agent for payment to the holders of such Separated Senior Notes the amounts specified in clauses 1(ii) and 2(ii) of the definition of Remarketing Value; and (iv) if there then remain any proceeds from such Successful Remarketing, after the application of such proceeds as set forth in clauses (i) through (iii) above, then remit any such remaining proceeds to the Purchase Contract Agent for the benefit of holders of the remarketed Senior Notes and to the Collateral Agent for the benefit of the holders of such Separated Senior Notes, on a pro rata basis, provided, however, that if such Successful Remarketing is consummated after 4:30 p.m. (New York City time) on the Remarketing Date and, despite using its commercially reasonable efforts, the Remarketing Agent cannot cause the applications of the proceeds specified above to occur on the Remarketing Settlement Date, then the Remarketing Agent may make such applications and remittances on the next succeeding Business Day. If a Successful Final Remarketing shall have occurred, the Remarketing Agent will on the Remarketing Settlement Date or Purchase Contract Settlement Date, as applicable, (i) deduct and retain for itself the Remarketing Fee, (ii) cause the remaining proceeds of the Remarketing with respect to the Pledged Senior Notes in an amount equal to the aggregate principal amount of such Senior Notes to be delivered to the Collateral Agent, on the Remarketing Settlement Date, (iii) if any Separated Senior Notes were remarketed, remit to the Collateral Agent for payment to the holders of such Separated Senior Notes sold in the Remarketing the remaining proceeds from such Successful Remarketing attributable to the Separated Senior Notes in an amount equal to the principal amount of 8 such Separated Senior Notes and (iv) if there remain any proceeds from such Successful Remarketing, after the application of such proceeds as set forth in clauses (i) through (iii) of this sentence, then remit such remaining proceeds to the Purchase Contract Agent for the benefit of the holders of the Pledged Senior Notes and to the Collateral Agent for the benefit of holders of Separated Senior Notes, on a pro rata basis, provided, however, that if such Successful Final Remarketing is consummated after 4:30 p.m. (New York City time) on the Remarketing Date and, despite using its commercially reasonable efforts, the Remarketing Agent cannot cause the application of the proceeds specified above to occur on the Remarketing Settlement Date, then the Remarketing Agent may make such applications and remittances on the next succeeding Business Day. If a Successful Remarketing occurs, by approximately 4:30 p.m. (New York City time) on the Remarketing Date, the Remarketing Agent shall advise, by telephone (promptly confirmed in writing in the case of clause (i)): (i) the Company, the Purchase Contract Agent, the Collateral Agent, the Securities Intermediary, the Depositary, and the Trustee of the Reset Rate determined in the Remarketing; (ii) each purchaser (or the Depositary Participant thereof) of Senior Notes in the Remarketing of the Reset Rate and the number of Senior Notes such purchaser is to purchase; and (iii) each purchaser to give instructions to its Depositary Participant to pay the purchase price on the Remarketing Settlement Date in same day funds against delivery of the Remarketed Senior Notes purchased through the facilities of the Depositary. If a Failed Remarketing occurs, the Remarketing Agent and the Company, as applicable, shall take the following actions: (i) The Remarketing Agent shall notify by telephone the Company, the Purchase Contract Agent, the Collateral Agent and the Trustee, that a Failed Remarketing has occurred, whereupon the Company shall notify the Clearing Agency, by telephone, that a Failed Remarketing has occurred. (ii) The Company shall cause a notice of the Failed Remarketing to be sent to the holders of all Senior Notes and to be published in an Authorized Newspaper in New York City, in each case, no later than the Business Day immediately preceding Purchase Contract Settlement Date. (iii) The Remarketing Agent shall determine the Reset Rate in accordance with clause (ii) of the Reset Rate definition. (iv) The Remarketing Agent shall remit the Pledged Senior Notes that were to be remarketed and the Separated Senior Notes that were to be remarketed to the Collateral Agent. Notwithstanding anything herein to the contrary, the Reset Rate shall in no event exceed the maximum rate, if any, permitted by applicable law. 9 In accordance with the Depositary's normal procedures, on the Remarketing Settlement Date or the Purchase Contract Settlement Date, as applicable, the transactions described above with respect to each Senior Notes remarketed in the Remarketing shall be executed through the Depositary, and the accounts of the respective Depositary Participants shall be debited and credited and such Remarketed Senior Notes delivered by book entry as necessary to effect purchases and sales of such Remarketed Senior Notes. The Depositary shall make payment in accordance with its normal procedures. If any Holder of Senior Notes selling Senior Notes in the Remarketing fails to deliver such Senior Notes, the direct or indirect Depositary Participant of such selling Holder and of any other Person who was to have purchased Senior Notes in the Remarketing may deliver to any such other Person an aggregate principal amount of Senior Notes that is less than the aggregate principal amount of Senior Notes that otherwise was to be purchased by such Person. In such event, the aggregate principal amount of Senior Notes to be so delivered shall be determined by such direct or indirect Depositary Participant, and delivery of such lesser aggregate principal amount of Senior Notes shall constitute good delivery. The Remarketing Agent is not obligated to purchase any Senior Notes that otherwise would remain unsold in the Remarketing. Neither the Company nor the Remarketing Agent shall be obligated in any case to provide funds to make payment upon tender of the Senior Notes for Remarketing. Under the Remarketing Agreement, the Company, in its capacity as issuer of the Senior Notes, shall be liable for, and shall pay, any and all costs and expenses incurred in connection with the Remarketing, other than the Remarketing Fee. The settlement procedures set forth herein, including provisions for payment by purchasers of the Remarketed Senior Notes in the Remarketing, shall be subject to modification to the extent required by the Depositary or if the book-entry system is no longer available for the Remarketed Senior Notes at the time of the Remarketing, to facilitate the remarketing of the Remarketed Senior Notes in certificated form, and shall provide for the authentication and delivery of Senior Notes in a principal amount equal to the unremarketed portion of such Senior Notes. In addition, the Remarketing Agent may modify the settlement procedures set forth herein in order to facilitate the settlement process. If a Tax Event shall occur and be continuing, the Company may, at its option, redeem the Senior Notes in whole (but not in part) at any time at a price per Senior Note equal to the Redemption Price. Installments of interest on the Senior Notes which are due and payable on or prior to the date of redemption (the "Tax Event Redemption Date") will be payable to the Holders of the Senior Notes registered as such at the close of business on the Regular Record Date for such interest payment. Each Holder of Senior Notes is deemed to have agreed to be bound by the Company's determination of the comparable yield and projected payment schedule for the Senior Notes for United Stated federal income tax purposes. 10 The Indenture permits, with certain exceptions as therein provided, the amendment thereof and the modification of the rights and obligations of the Company and the rights of the Holders of the Securities of each series to be affected under the Indenture at any time by the Company and the Trustee with the consent of the Holders of a majority in principal amount of the Securities at the time Outstanding of each series to be affected. The Indenture also contains provisions permitting the Holders of specified percentages in principal amount of the Securities of each series at the time Outstanding, on behalf of the Holders of all Securities of such series, to waive certain past defaults under the Indenture and their consequences. Any such consent or waiver by the Holder of this Senior Note shall be conclusive and binding upon such Holder and upon all future Holders of this Senior Note and of any Senior Note issued upon the registration of transfer hereof or in exchange therefor or in lieu hereof, whether or not notation of such consent or waiver is made upon this Senior Note. As provided in and subject to the provisions of the Indenture, the Holder of this Senior Note shall not have the right to institute any proceeding with respect to the Indenture or for the appointment of a receiver or trustee or for any other remedy thereunder, unless such Holder shall have previously given the Trustee written notice of a continuing Event of Default with respect to the Senior Notes, the Holders of not less than a majority in principal amount of the Senior Notes at the time Outstanding shall have made written request to the Trustee to institute proceedings in respect of such Event of Default as Trustee and offered the Trustee reasonable indemnity, and the Trustee shall not have received from the Holders of a majority in principal amount of Senior Notes at the time Outstanding a direction inconsistent with such request, and shall have failed to institute any such proceeding for 60 days after receipt of such notice, request and offer of indemnity. The foregoing shall not apply to any suit instituted by the Holder of this Senior Note for the enforcement of any payment of principal hereof or premium, if any, or interest hereon on or after the respective due dates expressed or provided for herein. No reference herein to the Indenture and no provision of this Senior Note or of the Indenture shall alter or impair the obligation of the Company, which is absolute and unconditional, to pay the principal of, premium, if any, and interest on this Senior Note at the times, place and rate, and in the coin or currency, herein prescribed. As provided in the Indenture and subject to certain limitations therein set forth, the transfer of this Senior Note is registrable in the Security Register, upon surrender of this Senior Note for registration of transfer at the office or agency of the Company in any place where the principal of, premium, if any, and interest on this Senior Note are payable, duly endorsed by, or accompanied by a written instrument of transfer in form satisfactory to the Company and the Security Registrar duly executed by, the Holder hereof or his attorney duly authorized in writing, and thereupon one or more new Senior Notes and of like tenor, of authorized denominations and for the same aggregate principal amount, will be issued to the designated transferee or transferees. The Senior Notes are issuable only in registered form without coupons in denominations of $50 and any integral multiple thereof. As provided in the Indenture and subject to certain limitations therein set forth, Senior Notes are exchangeable for a like aggregate principal amount of Senior Notes having the same Stated Maturity and of like tenor of any authorized denominations as requested by the Holder upon surrender of the Senior Note or Senior Notes to be exchanged at the office or agency of the Company. 11 No service charge shall be made for any such registration of transfer or exchange, but the Company may require payment of a sum sufficient to cover any tax or other governmental charge payable in connection therewith. Prior to due presentment of this Senior Note for registration of transfer, the Company, the Trustee and any agent of the Company or the Trustee may treat the Person in whose name this Security is registered as the owner hereof for all purposes, whether or not this Senior Note be overdue, and neither the Company, the Trustee nor any such agent shall be affected by notice to the contrary. All terms used in this Senior Note that are defined in the Indenture or the Purchase Contract Agreement, as the case may be, shall have the meanings assigned to them in the Indenture or the Purchase Contract Agreement, as the case may be and as the context may require. 12 ABBREVIATIONS The following abbreviations, when used in the inscription on the face of this instrument, shall be construed as though they were written out in full according to applicable laws or regulations: TEN COM - as tenants in common TEN ENT - as tenants by the entireties JT TEN - as joint tenants with rights of survivorship and not as tenants in common UNIF GIFT MIN ACT - ________________________________ Custodian for (Cust) ________________________________ (Minor) Under Uniform Gifts to Minors Act of ________________________________ (State) Additional abbreviations may also be used though not on the above list. __________________________________________________________________________ 13 FOR VALUE RECEIVED, the undersigned hereby sell(s) and transfer(s) unto ______________________________________________________________________________. (please insert Social Security or other identifying number of assignee) ______________________________________________________________________________. ______________________________________________________________________________. ______________________________________________________________________________. PLEASE PRINT OR TYPEWRITE NAME AND ADDRESS, INCLUDING POSTAL ZIP CODE OF ASSIGNEE the within Senior Note and all rights thereunder, hereby irrevocably constituting and appointing ______________________________________________________________________________. ______________________________________________________________________________. ______________________________________________________________________________. ______________________________________________________________________________. ______________________________________________________________________________. ______________________________________________________________________________. agent to transfer said Senior Note on the books of the Company, with full power of substitution in the premises. Dated: __________________ __, ____ ______________________________ NOTICE: The signature to this assignment must correspond with the name as written upon the face of the within instrument in every particular without alteration or enlargement, or any change whatever. 14 [TO BE ATTACHED TO GLOBAL CERTIFICATES AND PLEDGED SENIOR NOTES] SCHEDULE OF INCREASES OR DECREASES The following increases or decreases in this [Global Certificate][Pledged Senior Note] have been made:
- ---------------------------------------------------------------------------------------------------------------- Principal amount of Amount of decrease in Amount of increase in Senior Notes principal amount of principal amount of evidenced by the Senior Notes Senior Notes [Global Signature of evidenced by the evidenced by the Certificate][Pledged authorized officer [Global [Global Senior Note] of Trustee or Certificate][Pledged Certificate][Pledged following such Securities Date Senior Note] Senior Note] decrease or increase Custodian - ---------------------------------------------------------------------------------------------------------------- - ---------------------------------------------------------------------------------------------------------------- - ---------------------------------------------------------------------------------------------------------------- - ---------------------------------------------------------------------------------------------------------------- - ---------------------------------------------------------------------------------------------------------------- - ---------------------------------------------------------------------------------------------------------------- - ---------------------------------------------------------------------------------------------------------------- - ---------------------------------------------------------------------------------------------------------------- - ---------------------------------------------------------------------------------------------------------------- - ---------------------------------------------------------------------------------------------------------------- - ---------------------------------------------------------------------------------------------------------------- - ---------------------------------------------------------------------------------------------------------------- - ---------------------------------------------------------------------------------------------------------------- - ---------------------------------------------------------------------------------------------------------------- - ---------------------------------------------------------------------------------------------------------------- - ---------------------------------------------------------------------------------------------------------------- - ---------------------------------------------------------------------------------------------------------------- - ---------------------------------------------------------------------------------------------------------------- - ---------------------------------------------------------------------------------------------------------------- - ---------------------------------------------------------------------------------------------------------------- - ---------------------------------------------------------------------------------------------------------------- - ---------------------------------------------------------------------------------------------------------------- - ---------------------------------------------------------------------------------------------------------------- - ---------------------------------------------------------------------------------------------------------------- - ----------------------------------------------------------------------------------------------------------------
15 EXHIBIT B CERTIFICATE OF AUTHENTICATION This is one of the Securities of the series designated therein referred to in the within-mentioned Indenture. JPMORGAN CHASE BANK, as Trustee By: ________________________________ Authorized Officer EX-4.3 5 dex43.txt FORM OF PURCHASE CONTRACT AGREEMENT Exhibit 4.3 ================================================================================ DOMINION RESOURCES, INC. and JPMORGAN CHASE BANK As Purchase Contract Agent ______________________ PURCHASE CONTRACT AGREEMENT Dated as of March 20, 2002 ================================================================================ TABLE OF CONTENTS
Page ARTICLE I Definitions and Other Provisions of General Application Section 1.1. Definitions........................................................ 1 Section 1.2. Compliance Certificates and Opinions............................... 14 Section 1.3. Form of Documents Delivered to Purchase Contract Agent............. 15 Section 1.4. Acts of Holders; Record Dates...................................... 15 Section 1.5. Notices............................................................ 17 Section 1.6. Notice to Holders; Waiver.......................................... 17 Section 1.7. Effect of Headings and Table of Contents........................... 18 Section 1.8. Successors and Assigns............................................. 18 Section 1.9. Separability Clause................................................ 18 Section 1.10. Benefits of Agreement.............................................. 18 Section 1.11. Governing Law...................................................... 18 Section 1.12. Legal Holidays..................................................... 18 Section 1.13. Counterparts....................................................... 19 Section 1.14. Inspection of Agreement............................................ 19 ARTICLE II Certificate Forms Section 2.1. Forms of Certificates Generally.................................... 19 Section 2.2. Form of Purchase Contract Agent's Certificate of Authentication.... 20 ARTICLE III The Securities Section 3.1. Amount; Form and Denominations..................................... 20 Section 3.2. Rights and Obligations Evidenced by the Certificates............... 21 Section 3.3. Execution, Authentication, Delivery and Dating..................... 21 Section 3.4. Temporary Certificates............................................. 22 Section 3.5. Registration; Registration of Transfer and Exchange................ 23 Section 3.6. Book-Entry Interests............................................... 24 Section 3.7. Notices to Holders................................................. 25 Section 3.8. Appointment of Successor Clearing Agency........................... 25 Section 3.9. Definitive Certificates............................................ 25 Section 3.10. Mutilated, Destroyed, Lost and Stolen Certificates................. 25 Section 3.11. Persons Deemed Owners.............................................. 26 Section 3.12. Cancellation....................................................... 27 Section 3.13. Creation of Treasury Units by Substitution of Treasury Securities.. 27 Section 3.14. Reestablishment of Corporate Units................................. 29 Section 3.15. Transfer of Collateral upon Occurrence of Termination Event........ 30
i Section 3.16. No Consent to Assumption................................................ 30 ARTICLE IV The Senior Notes Section 4.1. Interest Payments; Rights to Interest Preserved......................... 31 Section 4.2. Interest Rate Reset..................................................... 32 Section 4.3. Notice and Voting....................................................... 32 Section 4.4. Tax Event Redemption.................................................... 32 ARTICLE V The Purchase Contracts Section 5.1. Purchase of Shares of Common Stock...................................... 33 Section 5.2. Contract Adjustment Payments............................................ 35 Section 5.3. [Intentionally omitted.]................................................ 36 Section 5.4. Payment of Purchase Price; Remarketing.................................. 36 Section 5.5. Issuance of Shares of Common Stock...................................... 42 Section 5.6. Adjustment of Settlement Rate........................................... 43 Section 5.7. Notice of Adjustments and Certain Other Events. ........................ 48 Section 5.8. Termination Event; Notice............................................... 49 Section 5.9. Early Settlement; Cash Settlement....................................... 49 Section 5.10. No Fractional Shares.................................................... 54 Section 5.11. Charges and Taxes....................................................... 54 ARTICLE VI Remedies Section 6.1. Unconditional Right of Holders to Receive Contract Adjustment Payments and to Purchase Shares of Common Stock.................................. 54 Section 6.2. Restoration of Rights and Remedies...................................... 55 Section 6.3. Rights and Remedies Cumulative.......................................... 55 Section 6.4. Delay or Omission Not Waiver............................................ 55 Section 6.5. Undertaking for Costs................................................... 55 Section 6.6. Waiver of Stay or Extension Laws........................................ 56 ARTICLE VII The Purchase Contract Agent Section 7.1. Certain Duties and Responsibilities..................................... 56 Section 7.2. Notice of Default....................................................... 57 Section 7.3. Certain Rights of Purchase Contract Agent............................... 57 Section 7.4. Not Responsible for Recitals or Issuance of Securities.................. 58 Section 7.5. May Hold Securities..................................................... 58 Section 7.6. Money Held in Custody................................................... 58 Section 7.7. Compensation and Reimbursement.......................................... 59 Section 7.8. Corporate Purchase Contract Agent Required; Eligibility................. 59
ii Section 7.9. Resignation and Removal; Appointment of Successor............................... 59 Section 7.10. Acceptance of Appointment by Successor.......................................... 61 Section 7.11. Merger, Conversion, Consolidation or Succession to Business..................... 61 Section 7.12. Preservation of Information; Communications to Holders.......................... 61 Section 7.13. No Obligations of Purchase Contract Agent....................................... 62 Section 7.14. Tax Compliance.................................................................. 62 ARTICLE VIII Supplemental Agreements Section 8.1. Supplemental Agreements Without Consent of Holders.............................. 63 Section 8.2. Supplemental Agreements With Consent of Holders................................. 63 Section 8.3. Execution of Supplemental Agreements............................................ 64 Section 8.4. Effect of Supplemental Agreements............................................... 64 Section 8.5. Reference to Supplemental Agreements............................................ 64 ARTICLE IX Merger, Consolidation, Share Exchange, Sale or Conveyance Section 9.1. Covenant Not to Merge, Consolidate, Enter into a Share Exchange, Sell or Convey Property Except Under Certain Conditions....................... 65 Section 9.2. Rights and Duties of Successor Corporation...................................... 65 Section 9.3. Officers' Certificate and Opinion of Counsel Given to Purchase Contract Agent... 66 ARTICLE X Covenants Section 10.1. Performance Under Purchase Contracts............................................ 66 Section 10.2. Maintenance of Office or Agency................................................. 66 Section 10.3. Company to Reserve Common Stock................................................. 67 Section 10.4. Covenants as to Common Stock.................................................... 67 Section 10.5. Statements of Officers of the Company as to Default............................. 67 Section 10.6. ERISA .......................................................................... 67
EXHIBITS EXHIBIT A Form of Corporate Unit Certificate EXHIBIT B Form of Treasury Unit Certificate EXHIBIT C Notice from Holder to Purchase Contract Agent (Election for Creation of Treasury Units or Recreation of Corporate Units) EXHIBIT D Instruction to Purchase Contract Agent EXHIBIT E Notice from Purchase Contract Agent to Holders (Transfer of Collateral upon Occurrence of a Termination Event) EXHIBIT F Notice to Settle by Cash EXHIBIT G Notice from Purchase Contract Agent to Collateral Agent and Indenture Trustee (Settlement of Purchase Contract through Remarketing) EXHIBIT H Notice from Holder to Indenture Trustee (Election to Tender for Purchase Senior Notes in the Remarketing) iii PURCHASE CONTRACT AGREEMENT, dated as of March 20, 2002, between DOMINION RESOURCES, INC., a Virginia corporation (the "Company"), and JPMORGAN CHASE BANK, a New York banking corporation, acting as purchase contract agent for the Holders of Securities from time to time (the "Purchase Contract Agent"). RECITALS The Company has duly authorized the execution and delivery of this Agreement and the Certificates evidencing the Securities. All things necessary to make the Purchase Contracts, when the Certificates are executed by the Company and authenticated, executed on behalf of the Holders and delivered by the Purchase Contract Agent, as provided in this Agreement, the valid obligations of the Company, and to constitute these presents a valid agreement of the Company, in accordance with its terms, have been done. For and in consideration of the premises and the purchase of the Securities by the Holders thereof, it is mutually agreed as follows: ARTICLE I Definitions and Other Provisions of General Application Section 1.1. Definitions. For all purposes of this Agreement, except as otherwise expressly provided or unless the context otherwise requires: (a) the terms defined in this Article have the meanings assigned to them in this Article and include the plural as well as the singular, and nouns and pronouns of the masculine gender include the feminine and neuter genders; (b) all accounting terms not otherwise defined herein have the meanings assigned to them in accordance with generally accepted accounting principles in the United States; (c) the words "herein," "hereof" and "hereunder" and other words of similar import refer to this Agreement as a whole and not to any particular Article, Section, Exhibit or other subdivision; (d) the following terms have the meanings given to them in this Section 1.1(d): "Act," when used with respect to any Holder, has the meaning specified in Section 1.4. "Adjusted Contract Adjustment Payment Rate" means, with respect to any Reset Transaction, the rate per annum that is the arithmetic average of the rates quoted by two Reference Dealers selected by the Company as the rate at which Contract Adjustment Payments should accrue so that the fair market value, expressed in dollars, of a Corporate Unit immediately after the later of 2 (i) public announcement of such Reset Transaction or (ii) public announcement of a change in dividend policy in connection with such Reset Transaction will equal the average Trading Price of a Corporate Unit for the 20 Trading Days immediately preceding the date of public announcement of such Reset Transaction; provided that the Adjusted Contract Adjustment Payment Rate shall not be less than 3.00% per annum. "Affiliate" of any specified Person means any other Person directly or indirectly controlling or controlled by or under direct or indirect common control with such specified Person. For the purposes of this definition, "control" when used with respect to any specified Person means the power to direct the management and policies of such Person, directly or indirectly, whether through the ownership of voting securities, by contract or otherwise; and the terms "controlling" and "controlled" have meanings correlative to the foregoing. "Affiliated Person" with respect to any specified Person means any other Person that is an Affiliate of such specified Person. "Agreement" means this instrument as originally executed or as it may from time to time be supplemented or amended by one or more agreements supplemental hereto entered into pursuant to the applicable provisions hereof. "Applicable Market Value" has the meaning set forth in Section 5.1. "applicants" has the meaning set forth in Section 7.12(b). "Authorized Newspaper" has the meaning set forth in the Indenture. "Bankruptcy Code" means title 11 of the United States Code, or any other law of the United States that from time to time provides a uniform system of bankruptcy laws. "Beneficial Owner" means, with respect to a Book-Entry Interest, a Person who is the beneficial owner of such Book-Entry Interest as reflected on the books of the Clearing Agency or on the books of a Person maintaining an account with such Clearing Agency (directly as a Clearing Agency Participant or as an indirect participant, in each case in accordance with the rules of such Clearing Agency). "Board of Directors" means the board of directors of the Company or a duly authorized committee of that board or two or more Senior Officers of the Company, acting jointly. "Board Resolution" means one or more resolutions of the Board of Directors, a copy of each of which has been certified by the Secretary or an Assistant Secretary of the Company, to have been duly adopted by the Board of Directors and to be in full force and effect on the date of such certification and delivered to the Purchase Contract Agent. "Book-Entry Interest" means a beneficial interest in a Global Certificate, ownership and transfers of which shall be maintained and made through book entries by a Clearing Agency as described in Section 3.6. 3 "Business Day" means any day other than (i) a Saturday or Sunday or a day on which banking institutions in The City of New York are authorized or required by law or executive order to remain closed or (ii) a day on which the Indenture Trustee is closed for business; provided that for purposes of the second paragraph of Section 1.12 only, the term "Business Day" shall also be deemed to exclude any day on which trading on the New York Stock Exchange, Inc. is closed or suspended. "Cash Settlement" has the meaning set forth in Section 5.9(B)(a)(i). "Certificate" means a Corporate Unit Certificate or a Treasury Unit Certificate. "Clearing Agency" means an organization registered as a "clearing agency" pursuant to Section 17A of the Exchange Act that is acting as a depositary for the Securities and in whose name, or in the name of a nominee of that organization, shall be registered a Global Certificate and which shall undertake to effect book entry transfers and pledges of the Securities. Initially, DTC shall be the Clearing Agency. "Clearing Agency Participant" means a broker, dealer, bank, other financial institution or other Person for whom from time to time the Clearing Agency effects book entry transfers and pledges of securities deposited with the Clearing Agency. "Closing Price" has the meaning set forth in Section 5.1. "Code" means the Internal Revenue Code of 1986, as amended, and the rules and regulations promulgated thereunder. "Collateral" has the meaning set forth in Section 1 of the Pledge Agreement. "Collateral Account" has the meaning set forth in Section 1 of the Pledge Agreement. "Collateral Agent" means Bank One Trust Company, N.A., as Collateral Agent under the Pledge Agreement until a successor Collateral Agent shall have become such pursuant to the applicable provisions of the Pledge Agreement, and thereafter "Collateral Agent" shall mean the Person who is then the Collateral Agent thereunder. "Collateral Substitution" means the substitution of Treasury Securities, for a Holder's Senior Notes, pursuant to Section 3.13 of this Agreement and Section 5.2 of the Pledge Agreement, and the substitution of a Holder's Senior Notes for Treasury Securities pursuant to Section 3.14 of this Agreement and Section 5.3 of the Pledge Agreement. "Common Stock" means the common stock, no par value per share, of the Company. "Company" means the Person named as the "Company" in the first paragraph of this instrument until a successor shall have become such pursuant to the applicable provision of this Agreement, and thereafter "Company" shall mean such successor. "Constituent Person" has the meaning set forth in Section 5.6(b). 4 "Contract Adjustment Payments" means the payments payable by the Company on the Payment Dates in respect of each Purchase Contract, equal to (a) if a Reset Transaction has not occurred, 3.00% per annum of the Stated Amount or (b) following the occurrence of a Reset Transaction, the Adjusted Contract Adjustment Payment Rate related to such Reset Transaction until any succeeding Reset Transaction shall occur, in either case computed (i) for any full quarterly period on the basis of a 360-day year of twelve 30-day months, (ii) for any period shorter than a full quarterly period for which such payments are calculated, on the basis of a 30-day month and (iii) for periods of less than a month, the actual number of days elapsed per 30-day month. "Corporate Trust Office" means the office of the Purchase Contract Agent at which, at any particular time, its corporate trust business shall be principally administered, which office at the date hereof is located at 450 West 33rd Street, 15th Floor, New York, New York 10001-2697, Attention: Institutional Trust Services. "Corporate Unit" means the collective rights and obligations of a Holder of a Corporate Unit Certificate in respect of the Senior Notes or, if substituted therefor, in respect of the Treasury Portfolio Interest, in each case, subject to the Pledge thereof, and the related Purchase Contract. "Corporate Unit Certificate" means a certificate evidencing the rights and obligations of a Holder in respect of the number of Corporate Units specified on such certificate. "Corporate Unit Register" and "Corporate Unit Registrar" have the respective meanings specified in Section 3.5. "Coupon Rate" means the percentage rate per annum at which each Senior Note will bear interest initially. "Current Market Price" has the meaning specified in Section 5.6(a)(8). "Depositary" means DTC until another Clearing Agency becomes its successor. "Dividend Yield" means, with respect to any security for any period, the dividends paid or proposed to be paid pursuant to an announced dividend policy on such security for such period divided by, if with respect to dividends paid on such security, the average Closing Price of such security during such period and, if with respect to dividends so proposed to be paid on such security, the Closing Price of such security on the effective date of the related Reset Transaction. "DTC" means The Depository Trust Company, the initial Clearing Agency. "Early Settlement" has the meaning set forth in Section 5.9(A)(a). "Early Settlement Amount" has the meaning set forth in Section 5.9(A)(a). "Early Settlement Date" has the meaning set forth in Section 5.9(A)(a). "Early Settlement Rate" has the meaning set forth in Section 5.9(A)(b). 5 "Election Date" means February 9, 2006, which is the fourth Business Day prior to the Initial Remarketing Date. "ERISA" means the Employee Retirement Income Security Act of 1974, as amended. "Exchange Act" means the Securities Exchange Act of 1934 and any statute successor thereto, in each case as amended from time to time, and the rules and regulations promulgated thereunder. "Expiration Date" has the meaning set forth in Section 1.4(e). "Expiration Time" has the meaning set forth in Section 5.6(a)(6). "Failed Remarketing" has the meaning set forth in Section 5.4(d). "Final Remarketing" has the meaning set forth in Section 2(d) of the Remarketing Agreement. "Final Remarketing Date" has the meaning set forth in Section 2(d) of the Remarketing Agreement. "Global Certificate" means a Certificate that evidences all or part of the Securities and is registered in the name of a Clearing Agency or a nominee thereof. "Holder" means, with respect to a Security, the Person in whose name the Security evidenced by a Corporate Unit Certificate and/or a Treasury Unit Certificate is registered in the related Corporate Unit Register and/or the Treasury Unit Register, as the case may be; provided, however, that in determining whether the Holders of the requisite number of Corporate Units and/or Treasury Units have Acted on any matter, then for the purpose of such determination only (and not for any other purpose hereunder), if the Security remains in the form of one or more Global Certificates and if the Clearing Agency which is the holder of such Global Certificate has sent an omnibus proxy assigning voting rights to the Clearing Agency Participants to whose accounts the Securities are credited on the applicable record date, the term "Holder" shall mean such Clearing Agency Participant acting at the direction of the Beneficial Owners. "Indenture" means the Senior Indenture, dated as of June 1, 2000, between the Company and the Indenture Trustee, as amended and supplemented from time to time (including any provisions of the TIA that are deemed incorporated therein and including the Supplemental Indenture), pursuant to which the Senior Notes will be issued. "Indenture Trustee" means JPMorgan Chase Bank (formerly known as The Chase Manhattan Bank), a New York banking corporation, as trustee under the Indenture, or any successor thereto. "Initial Remarketing" has the meaning set forth in Section 2(c) of the Remarketing Agreement. "Initial Remarketing Date" has the meaning set forth in Section 2(c) of the 6 Remarketing Agreement. "Issuer Order" or "Issuer Request" means a written request or order signed in the name of the Company by (i) either its Chief Executive Officer, its President or one of its Vice Presidents and (ii) either its Corporate Secretary or one of its Assistant Corporate Secretaries or its Treasurer or one of its Assistant Treasurers, and delivered to the Purchase Contract Agent. "non-electing share" has the meaning set forth in Section 5.6(b). "NYSE" has the meaning set forth in Section 5.1. "Officers' Certificate" means a certificate signed by (i) either the Chief Executive Officer, the President or one of the Vice Presidents and (ii) either the Corporate Secretary or one of the Assistant Corporate Secretaries or the Treasurer or one of the Assistant Treasurers, of the Company, and delivered to the Purchase Contract Agent. "Opinion of Counsel" means a written opinion of counsel, who may be counsel for the Company (and who may be an employee of the Company), and who shall be reasonably acceptable to the Purchase Contract Agent. "Outstanding Securities" means, with respect to any Corporate Units or Treasury Units and as of the date of determination, all Corporate Units or Treasury Units evidenced by Certificates theretofore authenticated, executed and delivered under this Agreement, except: (1) If a Termination Event has occurred, (i) Treasury Units and (ii) Corporate Units for which the underlying Treasury Securities, Senior Notes or Treasury Portfolio, as the case may be, have been theretofore deposited with the Purchase Contract Agent in trust for the Holders of such Corporate Units; (2) Corporate Units and Treasury Units evidenced by Certificates theretofore cancelled by the Purchase Contract Agent or delivered to the Purchase Contract Agent for cancellation or deemed cancelled pursuant to the provisions of this Agreement; and (3) Corporate Units and Treasury Units evidenced by Certificates in exchange for or in lieu of which other Certificates have been authenticated, executed on behalf of the Holder and delivered pursuant to this Agreement, other than any such Certificate in respect of which there shall have been presented to the Purchase Contract Agent proof satisfactory to it that such Certificate is held by a bona fide purchaser in whose hands the Corporate Units or Treasury Units evidenced by such Certificate are valid obligations of the Company; provided, however, that in determining whether the Holders of the requisite number of the Corporate Units or Treasury Units have given any request, demand, authorization, direction, notice, consent or waiver hereunder, Corporate Units or Treasury Units owned by the Company or any Affiliate of the Company shall be disregarded and deemed not to be Outstanding Securities, except that, in determining whether the Purchase Contract Agent shall be protected in relying upon any such request, demand, authorization, direction, notice, consent or waiver, only Corporate Units or Treasury Units which a Responsible Officer of the Purchase Contract Agent knows to be so owned shall be so disregarded. Corporate Units or Treasury Units so owned which have been pledged in good faith 7 may be regarded as Outstanding Securities if the pledgee establishes to the satisfaction of the Purchase Contract Agent the pledgee's right so to act with respect to such Corporate Units or Treasury Units and that the pledgee is not the Company or any Affiliate of the Company. "Payment Date" means each February 15, May 15, August 15 and November 15, commencing May 15, 2002. "Permitted Investments" has the meaning set forth in Section 1 of the Pledge Agreement. "Person" means a legal person, including any individual, corporation, estate, partnership, joint venture, association, joint-stock company, limited liability company, trust, unincorporated organization or government or any agency or political subdivision thereof or any other entity of whatever nature. "Plan" means an employee benefit plan that is subject to ERISA, a plan or individual retirement account that is subject to Section 4975 of the Code or any entity whose assets are considered assets of any such plan. "Pledge" means the pledge under the Pledge Agreement of the Senior Notes, any Treasury Portfolio or any Treasury Securities, in each case constituting a part of the Securities. "Pledge Agreement" means the Pledge Agreement, dated as of the date hereof, by and among the Company, the Collateral Agent, the Securities Intermediary and the Purchase Contract Agent, on its own behalf and as attorney-in-fact for the Holders from time to time of the Securities, as the same may be amended, modified or supplemented from time to time in accordance with the terms thereof. "Pledged Senior Notes" has the meaning set forth in Section 1 of the Pledge Agreement. "Pledged Treasury Portfolio Interest" has the meaning set forth in Section 1 of the Pledge Agreement. "Pledged Treasury Securities" has the meaning set forth in Section 1 of the Pledge Agreement. "Predecessor Certificate" means a Predecessor Corporate Unit Certificate or a Predecessor Treasury Unit Certificate. "Predecessor Corporate Unit Certificate" of any particular Corporate Unit Certificate means every previous Corporate Unit Certificate evidencing all or a portion of the rights and obligations of the Company and the Holder under the Corporate Units evidenced thereby; and, for the purposes of this definition, any Corporate Unit Certificate authenticated and delivered under Section 3.10 in exchange for or in lieu of a mutilated, destroyed, lost or stolen Corporate Unit Certificate shall be deemed to evidence the same rights and obligations of the Company and the Holder as the mutilated, destroyed, lost or stolen Corporate Unit Certificate. 8 "Predecessor Treasury Unit Certificate" of any particular Treasury Unit Certificate means every previous Treasury Unit Certificate evidencing all or a portion of the rights and obligations of the Company and the Holder under the Treasury Units evidenced thereby; and, for the purposes of this definition, any Treasury Unit Certificate authenticated and delivered under Section 3.10 in exchange for or in lieu of a mutilated, destroyed, lost or stolen Treasury Unit Certificate shall be deemed to evidence the same rights and obligations of the Company and the Holder as the mutilated, destroyed, lost or stolen Treasury Unit Certificate. "Primary Treasury Dealer" means a primary U.S. government securities dealer in New York City. "Proceeds" has the meaning set forth in Section 1 of the Pledge Agreement. "Purchase Contract" means, with respect to any Security, the contract forming a part of such Security and obligating the Company to (i) sell, and the Holder of such Security to purchase, shares of Common Stock and (ii) pay the Holder Contract Adjustment Payments in each case on the terms and subject to the conditions set forth in Article Five hereof. "Purchase Contract Agent" means the Person named as the "Purchase Contract Agent" in the first paragraph of this instrument until a successor Purchase Contract Agent shall have become such pursuant to the applicable provisions of this Agreement, and thereafter "Purchase Contract Agent" shall mean such Person. "Purchase Contract Settlement Date" means May 15, 2006. "Purchase Contract Settlement Fund" has the meaning set forth in Section 5.5. "Purchase Price" has the meaning set forth in Section 5.1. "Purchased Shares" has the meaning set forth in Section 5.6(a)(6). "Quotation Agent" means (i) Salomon Smith Barney Inc. and its respective successors, provided, however, that if the foregoing shall cease to be a Primary Treasury Dealer, the Company shall substitute therefor another Primary Treasury Dealer or (ii) any other Primary Treasury Dealer selected by the Company. "Record Date" for the Contract Adjustment Payments payable on any Payment Date means, as to any Global Certificate, the Business Day next preceding such Payment Date, and as to any other Certificate, the fifteenth Business Day prior to such Payment Date. "Redemption Amount" means, for each Senior Note, the product of (i) the principal amount of such Senior Note and (ii) a fraction whose numerator is the applicable Redemption Treasury Portfolio Purchase Price and whose denominator is the applicable Tax Event Redemption Principal Amount. "Redemption Price" means the redemption price per Senior Note equal to the Redemption Amount plus any accrued and unpaid interest on such Senior Note to the date of 9 redemption. "Redemption Treasury Portfolio" means, in connection with a Tax Event Redemption, (a) if the Tax Event Redemption Date occurs prior to the Initial Remarketing Date or, in the event that there has not been a Successful Initial Remarketing or Successful Subsequent Remarketing, prior to the Purchase Contract Settlement Date, a portfolio of zero-coupon U.S. Treasury Securities consisting of (i) principal or interest strips of U.S. Treasury Securities which mature on or prior to the Purchase Contract Settlement Date in an aggregate amount equal to the applicable Tax Event Redemption Principal Amount and (ii) with respect to each scheduled interest payment date on the Senior Notes that occurs after the Tax Event Redemption Date and on or before the Purchase Contract Settlement Date, principal or interest strips of U.S. Treasury Securities that mature on or prior to such date in an aggregate amount equal to the aggregate interest payment that would be due on the applicable Tax Event Redemption Principal Amount of the Senior Notes on such date, and (b) if the Tax Event Redemption Date occurs on or after the Initial Remarketing Date or, in the event that there has not been a Successful Initial Remarketing or a Successful Subsequent Remarketing, on or after the Purchase Contract Settlement Date, a portfolio of zero-coupon U.S. Treasury Securities consisting of (i) principal or interest strips of U.S. Treasury Securities which mature on or prior to the Stated Maturity in an aggregate amount equal to the applicable Tax Event Redemption Principal Amount and (ii) with respect to each scheduled interest payment date on the Senior Notes that occurs after the Tax Event Redemption Date, interest strips of such U.S. Treasury Securities that mature on or prior to such date in an aggregate amount equal to the aggregate interest payment that would be due on the applicable Tax Event Redemption Principal Amount of the Senior Notes on such date. "Redemption Treasury Portfolio Purchase Price" means the lowest aggregate price quoted by the Primary Treasury Dealer to the Quotation Agent on the third Business Day immediately preceding the Tax Event Redemption Date for the purchase of the Redemption Treasury Portfolio for settlement on the Tax Event Redemption Date. "Reference Dealer" means a dealer engaged in the trading of convertible securities. "Reference Price" has the meaning set forth in Section 5.1. "Register" means the Corporate Unit Register and the Treasury Unit Register. "Registrar" means the Corporate Unit Registrar and the Treasury Unit Registrar. "Remarketing" means the remarketing of the Remarketing Senior Notes pursuant to the Remarketing Procedures. "Remarketing Agent" has the meaning set forth in Section 5.4(b). "Remarketing Agreement" means the Remarketing Agreement, dated as of the date hereof between the Company and the Remarketing Agent, as the same may be amended, modified or supplemented from time to time in accordance with the terms thereof. "Remarketing Date" means the date of any Successful Remarketing. 10 "Remarketing Fee" has the meaning set forth in Section 5.4(b). "Remarketing Procedures" has the meaning specified in Section 1(b) of the Remarketing Agreement. "Remarketing Senior Notes" has the meaning set forth in Section 5.4(b). "Remarketing Settlement Date" means the date of the settlement of any Successful Remarketing, which will be three Business Days after such Remarketing. "Remarketing Value" means the sum of (1) Unless the Remarketing occurs on the Final Remarketing Date, the value on the Remarketing Date of U.S. Treasury securities that will mature or pay, on or prior to the Payment Date falling on the Purchase Contract Settlement Date, an amount of cash equal to the aggregate interest that is scheduled to be payable on that Payment Date, on (i) the Senior Notes that are included in Corporate Units and (ii) the Separated Senior Notes, in each case, which are participating in the Remarketing, assuming for that purpose that the interest rate on the Senior Notes is equal to the Coupon Rate; (2) the value on the Remarketing Date of U.S. Treasury securities that will pay, on or prior to the Purchase Contract Settlement Date, an amount of cash equal to the Stated Amount of (i) such Senior Notes that are included in Corporate Units and (ii) the Separated Senior Notes, in each case, which are participating in the Remarketing; and (3) the Remarketing Fee; provided that, for purposes of each of clauses (1) through (3) above, the Remarketing Value shall be calculated on the assumptions that (i) the U.S. Treasury securities are highly liquid securities and mature on or within 35 days prior to the Purchase Contract Settlement Date, as determined in good faith by the Remarketing Agent in a manner intended to minimize the Remarketing Value, and (ii) the U.S. Treasury securities are valued based on the ask-side price of the Treasury securities at a time between 9:00 a.m. and 11:00 a.m. (New York City time), selected by the Remarketing Agent, on the Remarketing Date as determined on a third-day settlement basis by a reasonable and customary means selected in good faith by the Remarketing Agent, plus accrued interest to that date; and provided further that, the Remarketing Agent shall, in its sole discretion, select the U.S. Treasury securities in connection with a Remarketing in open market transactions, at a U.S. Treasury auction and/or from its own account. "Reorganization Event" has the meaning set forth in Section 5.6(b). "Reset Rate" has the meaning set forth in Section 102 of the Supplemental Indenture. "Reset Transaction" means a merger, consolidation or statutory share exchange to which the Person that is the issuer of the shares of Common Stock for which the Purchase Contracts are then to be settled is a party, a sale of all or substantially all assets of such Person, a 11 recapitalization of such Common Stock or a distribution described in Section 5.6(a)(4) by such Person and after the effective date of such transaction the Purchase Contracts are then to be settled for shares of common stock of a Person (i) which had a Dividend Yield for the four fiscal quarters immediately preceding the public announcement thereof which was, or (ii) that announces a dividend policy prior to the effective date thereof which policy, if implemented, would result in a Dividend Yield on such shares of Common Stock for the next four fiscal quarters which would be, more than 250 basis points higher than the Dividend Yield on the shares of Common Stock for which the Purchase Contracts are to be settled prior to such effective date for the four fiscal quarters immediately preceding such public announcement. "Responsible Officer," when used with respect to the Purchase Contract Agent, means any officer of the Purchase Contract Agent assigned by the Purchase Contract Agent to administer its corporate trust matters. "Securities Intermediary" means Bank One Trust Company, N.A., as Securities Intermediary under the Pledge Agreement until a successor Securities Intermediary shall have become such pursuant to the applicable provisions of the Pledge Agreement, and thereafter "Securities Intermediary" shall mean such successor. "Security" means a Corporate Unit or a Treasury Unit or the collective reference to the Corporate Units and the Treasury Units, as the case may be. "Senior Notes" means the 2002 Series A 5.75% Senior Notes, due May 15, 2008 to be issued by the Company under the Supplemental Indenture, each having a minimum denomination of $50 and bearing interest, payable on the Payment Dates, at the Coupon Rate to, but not including, the Remarketing Settlement Date or the Purchase Contract Settlement Date, as applicable, and thereafter at the Reset Rate, in each case pursuant to the Supplemental Indenture. Any reference herein to "one Senior Note," "a Senior Note" or "the Senior Note" or any phrase herein having a similar meaning shall be a reference to a Senior Note in the principal amount of $50. "Senior Officer" means any one of the Company's Chief Executive Officer, President, Executive Vice Presidents, Senior Vice Presidents or Treasurer. "Separated Senior Notes" has the meaning set forth in Section 1 of the Pledge Agreement. "Settlement Rate" has the meaning specified in Section 5.1. "Stated Amount" means $50 in cash. "Stated Maturity" means, with respect to the Senior Notes, May 15, 2008. "Subsequent Remarketing" has the meaning specified in Section 2(d) of the Remarketing Agreement. "Subsequent Remarketing Date" has the meaning specified in Section 2(d) of the Remarketing Agreement. 12 "Successful Final Remarketing" has the meaning specified in Section 2(e) of the Remarketing Agreement. "Successful Initial Remarketing" has the meaning specified in Section 2(e) of the Remarketing Agreement. "Successful Remarketing" has the meaning specified in Section 2(e) of the Remarketing Agreement. "Successful Subsequent Remarketing" has the meaning specified in Section 2(e) of the Remarketing Agreement. "Supplemental Indenture" means the Tenth Supplemental Indenture, dated as of March 1, 2002, between the Company and the Indenture Trustee, supplementing the Indenture. "Tax Event" means the receipt by the Company of an opinion of a nationally recognized independent tax counsel experienced in such matters, which may be McGuireWoods LLP, to the effect that, as a result of (a) any amendment to, or change (including any announced proposed change) in, the laws (or any regulations thereunder) of the United States or any political subdivision or taxing authority thereof or therein affecting taxation, (b) any amendment to or change in an interpretation or application of such laws or regulations by any legislative body, court, governmental agency or regulatory authority or (c) any interpretation or pronouncement that provides for a position with respect to such laws or regulations that differs from the generally accepted position on March 20, 2002, which amendment, change or proposed change is effective or which interpretation or pronouncement is announced on or after March 20, 2002, there is more than an insubstantial risk that interest on the Senior Notes would not be deductible, in whole or in part, by the Company for United States federal income tax purposes. "Tax Event Redemption" means, if a Tax Event shall occur and be continuing, the redemption of the Senior Notes, at the option of the Company, in whole but not in part, on not less than 20 days nor more than 60 days' written notice. "Tax Event Redemption Date" means the date upon which a Tax Event Redemption is to occur. "Tax Event Redemption Principal Amount" means either (i) if the Tax Event Redemption Date occurs prior to the Initial Remarketing Date or, in the event that there has not been a Successful Remarketing or a Successful Subsequent Remarketing, prior to the Purchase Contract Settlement Date, the aggregate principal amount of the Senior Notes which are components of Corporate Units on the Tax Event Redemption Date or (ii) if the Tax Event Redemption Date occurs on or after the Initial Remarketing Date or, in the event that there has not been a Successful Remarketing or a Successful Subsequent Remarketing, on or after the Purchase Contract Settlement Date, the aggregate principal amount of the Senior Notes outstanding on such Tax Event Redemption Date. "Termination Date" means the date, if any, on which a Termination Event occurs. 13 "Termination Event" means the occurrence of any of the following events: (1) at any time on or prior to the Purchase Contract Settlement Date, a judgment, decree or court order shall have been entered granting relief with respect to the Company under the Bankruptcy Code or any other similar applicable Federal or state law, adjudicating the Company to be insolvent, or approving as properly filed a petition seeking reorganization or liquidation of the Company, and, unless such judgment, decree or order shall have been entered within 60 days prior to the Purchase Contract Settlement Date, such decree or order shall have continued undischarged and unstayed for a period of 60 days; (2) a judgment, decree or court order for the appointment of a receiver or liquidator or trustee or assignee in bankruptcy or insolvency of the Company or of its property, or for the winding up or liquidation of its affairs, shall have been entered, and, unless such judgment, decree or order shall have been entered within 60 days prior to the Purchase Contract Settlement Date, such judgment, decree or order shall have continued undischarged and unstayed for a period of 60 days; or (3) at any time on or prior to the Purchase Contract Settlement Date, the Company shall file a petition for relief under the Bankruptcy Code, or shall consent to the filing of a bankruptcy proceeding against it, or shall file a petition or answer or consent seeking reorganization or liquidation of the Company under the Bankruptcy Code or any other similar applicable Federal or state law, or shall consent to the filing of any such petition, or shall consent to the appointment of a receiver or liquidator or trustee or assignee in bankruptcy or insolvency of it or of its property, or shall make an assignment for the benefit of its creditors, or shall admit in writing its inability to pay its debts generally as they become due. "Threshold Appreciation Price" has the meaning set forth in Section 5.1. "TIA" means the Trust Indenture Act of 1939, as amended from time to time, or any successor legislation, and the rules and regulations promulgated thereunder. "Trading Day" has the meaning set forth in Section 5.1. "Trading Price" of a security on any date of determination means: (1) the closing sale price (or, if no closing price is reported, the last reported sale price) of a security (regular way) on the NYSE on such date, (2) if such security is not listed for trading on the NYSE on any such date, the closing sale price as reported in the composite transactions for the principal United States securities exchange on which such security is so listed, (3) if such security is not so listed on a United States national or regional securities exchange, the closing sale price as reported by the NASDAQ Stock Market, 14 (4) if such security is not so reported, the price quoted by Interactive Data Corporation for such security or, if Interactive Data Corporation is not quoting such price, a similar quotation service selected by the Company, (5) if such security is not so quoted, the average of the mid-point of the last bid and ask prices for such security from at least two dealers recognized as market-makers for such security, or (6) if such security is not so quoted, the average of the last bid andask prices for such security from a Reference Dealer. "Treasury Portfolio" has the meaning specified in Section 5.4(b). "Treasury Portfolio Interest" has the meaning specified in Section 5.4(b) or, in the event that a Tax Event Redemption has occurred, means the related interest in the Redemption Treasury Portfolio applicable to a Corporate Unit. "Treasury Portfolio Return" has the meaning specified in Section 4.1. "Treasury Security" means a zero-coupon U.S. Treasury Security which has a principal amount at maturity of $1,000 and which matures on or prior to the Business Day prior to the Purchase Contract Settlement Date. "Treasury Unit" means, following the substitution of Treasury Securities for Senior Notes as collateral to secure a Holder's obligations under a Purchase Contract, the collective rights and obligations of a Holder of a Treasury Unit Certificate in respect of such Treasury Securities, subject to the Pledge thereof, and the related Purchase Contract. "Treasury Unit Certificate" means a certificate evidencing the rights and obligations of a Holder in respect of the number of Treasury Units specified on such certificate. "Treasury Unit Register" and "Treasury Unit Registrar" have the respective meanings set forth in Section 3.5. Section 1.2. Compliance Certificates and Opinions. Except as otherwise expressly provided by this Agreement, upon any application or request by the Company to the Purchase Contract Agent to take any action in accordance with any provision of this Agreement, the Company shall furnish to the Purchase Contract Agent an Officers' Certificate stating that all conditions precedent, if any, provided for in this Agreement relating to the proposed action have been complied with and, if requested by the Purchase Contract Agent, an Opinion of Counsel stating that, in the opinion of such counsel, all such conditions precedent, if any, have been complied with, except that in the case of any such application or request as to which the furnishing of such documents is specifically required by any provision of this Agreement relating to such particular application or request, no additional certificate or opinion need be furnished. Every certificate or opinion with respect to compliance with a condition or covenant provided for in this Agreement (other than pursuant to Section 10.5) shall include: 15 (1) a statement that each individual signing such certificate or opinion has read such covenant or condition and the definitions herein relating thereto; (2) a brief statement as to the nature and scope of the examination or investigation upon which the statements or opinions contained in such certificate or opinion are based; (3) a statement that, in the opinion of each such individual, he or she has made such examination or investigation as is necessary to enable such individual to express an informed opinion as to whether or not such covenant or condition has been complied with; and (4) a statement as to whether, in the opinion of each such individual, such condition or covenant has been complied with. Section 1.3. Form of Documents Delivered to Purchase Contract Agent. In any case where several matters are required to be certified by, or covered by an opinion of, any specified Person, it is not necessary that all such matters be certified by, or covered by the opinion of, only one such Person, or that they be so certified or covered by only one document, but one such Person may certify or give an opinion with respect to some matters and one or more other such Persons as to other matters, and any such Person may certify or give an opinion as to such matters in one or several documents. Any certificate or opinion of an officer of the Company may be based, insofar as it relates to legal matters, upon a certificate or opinion of, or representations by, counsel, unless such officer knows, or in the exercise of reasonable care should know, that the certificate or opinion or representations with respect to the matters upon which his certificate or opinion is based are erroneous. Any such certificate or Opinion of Counsel may be based, insofar as it relates to factual matters, upon a certificate or opinion of, or representations by, an officer or officers of the Company stating that the information with respect to such factual matters is in the possession of the Company unless such counsel knows, or in the exercise of reasonable care should know, that the certificate or opinion or representations with respect to such matters are erroneous. Where any Person is required to make, give or execute two or more applications, requests, consents, certificates, statements, opinions or other instruments under this Agreement, they may, but need not, be consolidated and form one instrument. Section 1.4. Acts of Holders; Record Dates. (a) Any request, demand, authorization, direction, notice, consent, waiver or other action provided by this Agreement to be given or taken by Holders may be embodied in and evidenced by one or more instruments of substantially similar tenor signed by such Holders in person or by an agent duly appointed in writing; and, except as herein otherwise expressly provided, such action shall become effective when such instrument or instruments are delivered to the Purchase Contract Agent and, where it is hereby expressly required, to the Company. Such instrument or instruments (and the action embodied therein and evidenced thereby) are herein sometimes referred to as the "Act" of the Holders signing such instrument or instruments. Proof of execution of any such instrument or of a writing appointing any such agent shall be sufficient for any purpose of this 16 Agreement and (subject to Section 7.1) conclusive in favor of the Purchase Contract Agent and the Company, if made in the manner provided in this Section. (b) The fact and date of the execution by any Person of any such instrument or writing may be proved in any manner which the Purchase Contract Agent deems sufficient. (c) The ownership of Securities shall be proved by the Corporate Unit Register or the Treasury Unit Register, as the case may be. (d) Any request, demand, authorization, direction, notice, consent, waiver or other Act of the Holder of any Certificate shall bind every future Holder of the same Certificate and the Holder of every Certificate issued upon the registration of transfer thereof or in exchange therefor or in lieu thereof in respect of anything done, omitted or suffered to be done by the Purchase Contract Agent or the Company in reliance thereon, whether or not notation of such action is made upon such Certificate. (e) The Company may set any day as a record date for the purpose of determining the Holders of Outstanding Securities entitled to give, make or take any request, demand, authorization, direction, notice, consent, waiver or other action provided or permitted by this Agreement to be given, made or taken by Holders of Securities. If any record date is set pursuant to this paragraph, the Holders of the Outstanding Corporate Units and the Outstanding Treasury Units, as the case may be, on such record date, and no other Holders, shall be entitled to take the relevant action with respect to the Corporate Units or the Treasury Units, as the case may be, whether or not such Holders remain Holders after such record date; provided that no such action shall be effective hereunder unless taken on or prior to the applicable Expiration Date by Holders of the requisite number of Outstanding Securities on such record date. Nothing contained in this paragraph shall be construed to prevent the Company from setting a new record date for any action for which a record date has previously been set pursuant to this paragraph (whereupon the record date previously set shall automatically and with no action by any Person be cancelled and be of no effect), and nothing contained in this paragraph shall be construed to render ineffective any action taken by Holders of the requisite number of Outstanding Securities on the date such action is taken. Promptly after any record date is set pursuant to this paragraph, the Company, at its own expense, shall cause notice of such record date, the proposed action by Holders and the applicable Expiration Date to be given to the Purchase Contract Agent in writing and to each Holder of Securities in the manner set forth in Section 1.6. With respect to any record date set pursuant to this Section, the Company may designate any date as the "Expiration Date" and from time to time may change the Expiration Date to any earlier or later day; provided that no such change shall be effective unless notice of the proposed new Expiration Date is given to the Purchase Contract Agent in writing, and to each Holder of Securities in the manner set forth in Section 1.6, on or prior to the existing Expiration Date. If an Expiration Date is not designated with respect to any record date set pursuant to this Section, the Company shall be deemed to have initially designated the 180th day after such record date as the Expiration Date with respect thereto, subject to its right to change the Expiration Date as provided in this paragraph. Notwithstanding the foregoing, no Expiration Date shall be later than the 180th day after the applicable record date. 17 Section 1.5. Notices. Any notice or communication is duly given if in writing and delivered in Person or mailed by first-class mail (registered or certified, return receipt requested), telecopier (with receipt confirmed) or overnight air courier guaranteeing next day delivery, to the others' address; provided that notice shall be deemed given to the Purchase Contract Agent only upon receipt thereof: If to the Purchase Contract Agent: JPMorgan Chase Bank 450 West 33/rd/ Street, 15/th/ Floor New York, New York 10001-2697 Telecopier No.: (212)946-8159/8160 Attention: Institutional Trust Services If to the Company: Dominion Resources, Inc. 120 Tredegar Street Richmond, Virginia 23219 Telecopier No.: (804)819-2211 Attention: Treasurer If to the Collateral Agent and Securities Intermediary: Bank One Trust Company, N.A. 153 West 51/st/ Street New York, New York 10019 Telecopier No.: (212)373-1383 Attention: Corporate Trust Administration If to the Indenture Trustee: JPMorgan Chase Bank 450 West 33/rd/ Street, 15/th/ Floor New York, New York 10001-2697 Telecopier No.: (212)946-8159/8160 Attention: Institutional Trust Services Section 1.6. Notice to Holders; Waiver. Where this Agreement provides for notice to Holders of any event, such notice shall be sufficiently given (unless otherwise herein expressly provided) if in writing and mailed, first-class postage prepaid, to each Holder affected by such event, at its address as it appears in the applicable Register, not later than the latest date, and not earlier than the earliest date, prescribed for the giving of such notice. In any case where notice to Holders is given by mail, neither the failure to mail such notice, nor any defect in any notice so mailed to any particular Holder shall affect the sufficiency of such notice with respect to other Holders. Where this Agreement provides for notice in any manner, 18 such notice may be waived in writing by the Person entitled to receive such notice, either before or after the event, and such waiver shall be the equivalent of such notice. Waivers of notice by Holders shall be filed with the Purchase Contract Agent, but such filing shall not be a condition precedent to the validity of any action taken in reliance upon such waiver. In case by reason of the suspension of regular mail service or by reason of any other cause it shall be impracticable to give such notice by mail, then such notification as shall be made with the approval of the Purchase Contract Agent shall constitute a sufficient notification for every purpose hereunder. Section 1.7. Effect of Headings and Table of Contents. The Article and Section headings herein and the Table of Contents are for convenience only and shall not affect the construction hereof. Section 1.8. Successors and Assigns. All covenants and agreements in this Agreement by the Company shall bind its successors and assigns, whether so expressed or not. Section 1.9. Separability Clause. In case any provision in this Agreement or in the Securities shall be invalid, illegal or unenforceable, the validity, legality and enforceability of the remaining provisions hereof and thereof shall not in any way be affected or impaired thereby. Section 1.10. Benefits of Agreement. Nothing contained in this Agreement or in the Securities, express or implied, shall give to any Person, other than the parties hereto and their successors hereunder and, to the extent provided hereby, the Holders, any benefits or any legal or equitable right, remedy or claim under this Agreement. The Holders from time to time shall be beneficiaries of this Agreement and shall be bound by all of the terms and conditions hereof and of the Securities evidenced by their Certificates by their acceptance of delivery of such Certificates. Section 1.11. Governing Law. This Agreement and the Securities shall be governed by, and construed in accordance with, the laws of the State of New York. Section 1.12. Legal Holidays. In any case where any Payment Date shall not be a Business Day, then (notwithstanding any other provision of this Agreement or the Corporate Unit Certificates or the Treasury Unit Certificates) Contract Adjustment Payments shall not be made on such date, but shall be made on the next succeeding Business Day with the same force and effect as if made on such Payment Date, provided that no interest shall accrue or be payable by the Company or any Holder for the period from and after any such Payment Date, except that, if such next succeeding Business Day 19 is in the next succeeding calendar year, such payment shall be made on the immediately preceding Business Day with the same force and effect as if made on such Payment Date. In any case where any Purchase Contract Settlement Date shall not be a Business Day, notwithstanding any other provision of this Agreement, the Corporate Unit Certificates or the Treasury Unit Certificates, Purchase Contracts shall not be performed on such date, but the Purchase Contracts shall be performed on the immediately following Business Day with the same force and effect as if performed on the Purchase Contract Settlement Date. Section 1.13. Counterparts. This Agreement may be executed in any number of counterparts by the parties hereto on separate counterparts, each of which, when so executed and delivered, shall be deemed an original, but all such counterparts shall together constitute one and the same instrument. Section 1.14. Inspection of Agreement. A copy of this Agreement shall be available at all reasonable times during normal business hours at the Corporate Trust Office for inspection by any Holder or Beneficial Owner. ARTICLE II Certificate Forms Section 2.1. Forms of Certificates Generally. The Corporate Unit Certificates (including the form of Purchase Contract forming part of the Corporate Units evidenced thereby) shall be in substantially the form set forth in Exhibit A hereto, with such letters, numbers or other marks of identification or designation and such legends or endorsements printed, lithographed or engraved thereon as may be required by the rules of any securities exchange on which the Corporate Units are listed or any depositary therefor, or as may, consistently herewith, be determined by the officers of the Company executing such Corporate Unit Certificates, as evidenced by their execution of the Corporate Unit Certificates. The definitive Corporate Unit Certificates shall be printed, lithographed or engraved on steel engraved borders or may be produced in any other manner, all as determined by the officers of the Company executing the Corporate Units evidenced by such Corporate Unit Certificates, consistent with the provisions of this Agreement, as evidenced by their execution thereof. The Treasury Unit Certificates (including the form of Purchase Contracts forming part of the Treasury Units evidenced thereby) shall be in substantially the form set forth in Exhibit B hereto, with such letters, numbers or other marks of identification or designation and such legends or endorsements printed, lithographed or engraved thereon as may be required by the rules of any securities exchange on which the Treasury Units may be listed or any depositary therefor, or as may, consistently herewith, be determined by the officers of the Company executing such Treasury Unit Certificates, as evidenced by their execution of the Treasury Unit Certificates. 20 The definitive Treasury Unit Certificates shall be printed, lithographed or engraved on steel engraved borders or may be produced in any other manner, all as determined by the officers of the Company executing the Treasury Units evidenced by such Treasury Unit Certificates, consistent with the provisions of this Agreement, as evidenced by their execution thereof. Every Global Certificate authenticated, executed on behalf of the Holders and delivered hereunder shall bear a legend in substantially the following form: "This Certificate is a Global Certificate within the meaning of the Purchase Contract Agreement hereinafter referred to and is registered in the name of The Depository Trust Company, a New York corporation (the "Depositary"), or a nominee of the Depositary. This Certificate is exchangeable for certificates registered in the name of a person other than the Depositary or its nominee only in the limited circumstances described in the Purchase Contract Agreement and no transfer of this Certificate (other than a transfer of this Certificate as a whole by the Depositary to a nominee of the Depositary or by a nominee of the Depositary to the Depositary or another nominee of the Depositary) may be registered except in limited circumstances. Unless this Certificate is presented by an authorized representative of the Depositary for registration of transfer, exchange or payment, and any certificate issued is registered in the name of Cede & Co. or such other name as is requested by an authorized representative of the Depositary (and any payment hereon is made to Cede & Co. or to such other entity as is requested by an authorized representative of the Depositary), any transfer, pledge or other use hereof for value or otherwise by or to any person is wrongful since the registered owner hereof, Cede & Co., has an interest herein." Section 2.2. Form of Purchase Contract Agent's Certificate of Authentication. The form of the Purchase Contract Agent's certificate of authentication of the Corporate Unit shall be in substantially the form set forth on the form of the Corporate Unit Certificates. The form of the Purchase Contract Agent's certificate of authentication of the Treasury Unit shall be in substantially the form set forth on the form of the Treasury Unit Certificates. ARTICLE III The Securities Section 3.1. Amount; Form and Denominations. The aggregate number of Securities evidenced by Certificates authenticated, executed on behalf of the Holders and delivered hereunder is limited to 6,000,000 (or 6,600,000 if the purchaser of the Certificates exercises its overallotment option in full), except for Certificates authenticated, executed and delivered upon registration of transfer of, in exchange for, or in lieu of, other Certificates pursuant to Section 3.4, 3.5, 3.10, 3.13, 3.14, 5.9 or 8.5. 21 The Certificates shall be issuable only in registered form and only in denominations of a single Corporate Unit or Treasury Unit and any integral multiple thereof. Section 3.2. Rights and Obligations Evidenced by the Certificates. Each Corporate Unit Certificate shall evidence the number of Corporate Units specified therein, with each such Corporate Unit representing (1) the ownership by the Holder thereof of a beneficial interest in one Senior Note or if substituted therefor, the Pledged Treasury Portfolio Interest, in either case, subject to the Pledge of such Senior Note or such Pledged Treasury Portfolio Interest, as the case may be, by such Holder pursuant to the Pledge Agreement, and (2) the rights and obligations of the Holder thereof and the Company under one Purchase Contract. The Purchase Contract Agent as attorney-in-fact for, and on behalf of, the Holder of each Corporate Unit shall pledge, pursuant to the Pledge Agreement, the Senior Note or if substituted therefor, the Treasury Portfolio Interest, forming a part of such Corporate Unit, to the Collateral Agent and grant to the Collateral Agent a security interest in the right, title and interest of such Holder in such Senior Note or such Treasury Portfolio Interest, as the case may be, for the benefit of the Company, to secure the obligation of the Holder under each Purchase Contract to purchase shares of Common Stock. Prior to the purchase of shares of Common Stock under each Purchase Contract, such Purchase Contracts shall not entitle the Holder of a Corporate Unit Certificate to any of the rights of a holder of shares of Common Stock, including, without limitation, the right to vote or receive any dividends or other payments or to consent or to receive notice as a shareholder in respect of the meetings of shareholders or for the election of directors of the Company or for any other matter, or any other rights whatsoever as a shareholder of the Company. Upon the formation of Treasury Units pursuant to Section 3.13, each Treasury Unit Certificate shall evidence the number of Treasury Units specified therein, with each such Treasury Unit representing (1) the ownership by the Holder thereof of a 1/20 undivided beneficial interest in a Treasury Security with a principal amount equal to $1,000, subject to the Pledge of such Treasury Security by such Holder pursuant to the Pledge Agreement, and (2) the rights and obligations of the Holder thereof and the Company under one Purchase Contract. The Purchase Contract Agent as attorney-in-fact for, and on behalf of, the Holder of each Treasury Unit shall pledge, pursuant to the Pledge Agreement, the Treasury Security, forming a part of such Treasury Unit, to the Collateral Agent and grant to the Collateral Agent a security interest in the right, title and interest of such Holder in such Treasury Security for the benefit of the Company, to secure the obligation of the Holder under each Purchase Contract to purchase shares of Common Stock. Prior to the purchase of shares of Common Stock under each Purchase Contract, such Purchase Contract shall not entitle the Holder of a Treasury Unit Certificate to any of the rights of a holder of shares of Common Stock, including, without limitation, the right to vote or receive any dividends or other payments or to consent or to receive notice as a shareholder in respect of the meetings of shareholders or for the election of directors of the Company or for any other matter, or any other rights whatsoever as a shareholder of the Company. Section 3.3. Execution, Authentication, Delivery and Dating. Subject to the provisions of Sections 3.1, 3.13 and 3.14 hereof, upon the execution and delivery of this Agreement, and at any time and from time to time thereafter, the Company may deliver Certificates executed by the Company to the Purchase Contract Agent for authentication, 22 execution on behalf of the Holders and delivery, together with its Issuer Order for authentication of such Certificates, and the Purchase Contract Agent in accordance with such Issuer Order shall authenticate, execute on behalf of the Holders and deliver such Certificates. The Certificates shall be executed on behalf of the Company by (i) either its Chief Executive Officer, its President or one of its Vice Presidents and (ii) either the Corporate Secretary or one of its Assistant Corporate Secretaries or its Treasurer or one of its Assistant Treasurers. The signature of any of these officers on the Certificates may be manual or facsimile. Certificates bearing the manual or facsimile signatures of individuals who were at any time the proper officers of the Company shall bind the Company, notwithstanding that such individuals or any of them have ceased to hold such offices prior to the authentication and delivery of such Certificates or did not hold such offices at the date of such Certificates. No Purchase Contract evidenced by a Certificate shall be valid until such Certificate has been executed on behalf of the Holder by the manual signature of an authorized officer of the Purchase Contract Agent, as such Holder's attorney-in-fact. Such signature by an authorized officer of the Purchase Contract Agent shall be conclusive evidence that the Holder of such Certificate has entered into the Purchase Contracts evidenced by such Certificate. Each Certificate shall be dated the date of its authentication. No Certificate shall be entitled to any benefit under this Agreement or be valid or obligatory for any purpose unless there appears on such Certificate a certificate of authentication substantially in the form provided for herein executed by an authorized officer of the Purchase Contract Agent by manual signature, and such certificate upon any Certificate shall be conclusive evidence, and the only evidence, that such Certificate has been duly authenticated and delivered hereunder. Section 3.4. Temporary Certificates. Pending the preparation of definitive Certificates, the Company shall execute and deliver to the Purchase Contract Agent, and the Purchase Contract Agent shall authenticate, execute on behalf of the Holders, and deliver, in lieu of such definitive Certificates, temporary Certificates which are in substantially the form set forth in Exhibit A or Exhibit B hereto, as the case may be, with such letters, numbers or other marks of identification or designation and such legends or endorsements printed, lithographed or engraved thereon as may be required by the rules of any securities exchange on which the Corporate Units or Treasury Units are or may be listed, or as may, consistently herewith, be determined by the officers of the Company executing such Certificates, as evidenced by their execution of the Certificates. If temporary Certificates are issued, the Company will cause definitive Certificates to be prepared without unreasonable delay. After the preparation of definitive Certificates, the temporary Certificates shall be exchangeable for definitive Certificates upon surrender of the temporary Certificates at the Corporate Trust Office, at the expense of the Company and without charge to the Holder. Upon surrender for cancellation of any one or more temporary Certificates, the Company shall execute and deliver to the Purchase Contract Agent, and the Purchase Contract Agent 23 shall authenticate, execute on behalf of the Holder, and deliver in exchange therefor, one or more definitive Certificates of like tenor and denominations and evidencing a like aggregate number of Corporate Units or Treasury Units, as the case may be, as the temporary Certificate or Certificates so surrendered. Until so exchanged, the temporary Certificates shall in all respects evidence the same benefits and the same obligations with respect to the Corporate Units or Treasury Units, as the case may be, evidenced thereby as definitive Certificates. Section 3.5. Registration; Registration of Transfer and Exchange. The Purchase Contract Agent shall keep at the Corporate Trust Office a register (the "Corporate Unit Register") in which, subject to such reasonable regulations as it may prescribe, the Purchase Contract Agent shall provide for the registration of Corporate Unit Certificates and of transfers of Corporate Unit Certificates (the Purchase Contract Agent, in such capacity, the "Corporate Unit Registrar") and a register (the "Treasury Unit Register") in which, subject to such reasonable regulations as it may prescribe, the Purchase Contract Agent shall provide for the registration of the Treasury Unit Certificates and transfers of Treasury Unit Certificates (the Purchase Contract Agent, in such capacity, the "Treasury Unit Registrar"). Upon surrender for registration of transfer of any Certificate at the Corporate Trust Office, the Company shall execute and deliver to the Purchase Contract Agent, and the Purchase Contract Agent shall authenticate, execute on behalf of the designated transferee or transferees, and deliver, in the name of the designated transferee or transferees, one or more new Certificates of any authorized denominations, like tenor, and evidencing a like aggregate number of Corporate Units or Treasury Units, as the case may be. At the option of the Holder, Certificates may be exchanged for other Certificates, of any authorized denominations and evidencing a like number of Corporate Units or Treasury Units, as the case may be, upon surrender of the Certificates to be exchanged at the Corporate Trust Office. Whenever any Certificates are so surrendered for exchange, the Company shall execute and deliver to the Purchase Contract Agent, and the Purchase Contract Agent shall authenticate, execute on behalf of the Holder, and deliver the Certificates which the Holder making the exchange is entitled to receive. All Certificates issued upon any registration of transfer or exchange of a Certificate shall evidence the ownership of the same aggregate number of Corporate Units or Treasury Units, as the case may be, and be entitled to the same benefits and subject to the same obligations, under this Agreement as the Corporate Units or Treasury Units, as the case may be, evidenced by the Certificate surrendered upon such registration of transfer or exchange. Every Certificate presented or surrendered for registration of transfer or for exchange shall (if so required by the Purchase Contract Agent) be duly endorsed, or be accompanied by a written instrument of transfer in form satisfactory to the Company and the Purchase Contract Agent duly executed, by the Holder thereof or its attorney duly authorized in writing. No service charge shall be made for any registration of transfer or exchange of a Certificate, but the Company and the Purchase Contract Agent may require payment from the Holder of a sum sufficient to cover any tax or other governmental charge that may be imposed in connection 24 with any registration of transfer or exchange of Certificates, other than any exchanges pursuant to Sections 3.4, 3.6 and 8.5 not involving any transfer. Notwithstanding the foregoing, the Company shall not be obligated to execute and deliver to the Purchase Contract Agent, and the Purchase Contract Agent shall not be obligated to authenticate, execute on behalf of the Holder and deliver any Certificate in exchange for any other Certificate presented or surrendered for registration of transfer or for exchange on or after the Business Day immediately preceding the earlier of the Purchase Contract Settlement Date or the Termination Date. In lieu of delivery of a new Certificate, upon satisfaction of the applicable conditions specified above in this Section and receipt of appropriate registration or transfer instructions from such Holder, the Purchase Contract Agent shall: (1) if the Purchase Contract Settlement Date has occurred, deliver the shares of Common Stock issuable in respect of the Purchase Contracts forming a part of the Securities evidenced by such other Certificate; or (2) if a Termination Event shall have occurred prior to the Purchase Contract Settlement Date, transfer the Senior Notes, the Treasury Portfolio or the Treasury Securities, as the case may be, evidenced thereby, in each case subject to the applicable conditions and in accordance with the applicable provisions of Article Five hereof. Section 3.6. Book-Entry Interests. The Certificates, on original issuance, will be issued in the form of one or more fully registered Global Certificates, to be delivered to the Clearing Agency or its custodian by, or on behalf of, the Company. Such Global Certificate shall initially be registered on the books and records of the Company in the name of Cede & Co., the nominee of the initial Clearing Agency, and no Beneficial Owner will receive a definitive Certificate representing such Beneficial Owner's interest in such Global Certificate, except as provided in Section 3.9. The Purchase Contract Agent shall enter into an agreement with the Clearing Agency if so requested by the Company. Unless and until definitive, fully registered Certificates have been issued to Beneficial Owners pursuant to Section 3.9: (1) the provisions of this Section 3.6 shall be in full force and effect; (2) the Company shall be entitled to deal with the Clearing Agency for all purposes of this Agreement (including making Contract Adjustment Payments and receiving approvals, votes or consents hereunder) as the Holder of the Securities and the sole holder of the Global Certificates and shall have no obligation to the Beneficial Owners; (3) to the extent that the provisions of this Section 3.6 conflict with any other provisions of this Agreement, the provisions of this Section 3.6 shall control; and (4) the rights of the Beneficial Owners shall be exercised only through the Clearing Agency and shall be limited to those established by law and agreements between such Beneficial Owners and the Clearing Agency and/or the Clearing Agency Participants. 25 Section 3.7. Notices to Holders. Whenever a notice or other communication to the Holders is required to be given under this Agreement, the Company or the Company's agent shall give such notices and communications to the Holders and, with respect to any Securities registered in the name of a Clearing Agency or the nominee of a Clearing Agency, the Company or the Company's agent shall, except as set forth herein, have no obligations to the Beneficial Owners. Section 3.8. Appointment of Successor Clearing Agency. If any Clearing Agency elects to discontinue its services as securities depositary with respect to the Securities or ceases to be eligible as a "clearing agency" under the Exchange Act, the Company may, in its sole discretion, appoint a successor Clearing Agency with respect to the Securities. Section 3.9. Definitive Certificates. If: (1) a Clearing Agency elects to discontinue its services as securities depositary with respect to the Securities or ceases to be eligible as a "clearing agency" under the Exchange Act and a successor Clearing Agency is not appointed by the Company pursuant to Section 3.8 within 90 days after the Company receives notice from the Clearing Agency of such election or becomes aware of such cessation; or (2) there shall have occurred and be continuing a default by the Company in respect of its obligations under one or more Purchase Contracts, then upon surrender of the Global Certificates representing the Securities by the Clearing Agency, accompanied by registration instructions, the Company shall cause definitive Certificates to be delivered to Beneficial Owners in accordance with the instructions of the Clearing Agency. The Company and the Purchase Contract Agent shall not be liable for any delay in delivery of such instructions and may conclusively rely on and shall be protected in relying on, such instructions. Section 3.10. Mutilated, Destroyed, Lost and Stolen Certificates. If any mutilated Certificate is surrendered to the Purchase Contract Agent, the Company shall execute and deliver to the Purchase Contract Agent, and the Purchase Contract Agent shall authenticate, execute on behalf of the Holder, and deliver in exchange therefor, a new Certificate, evidencing the same number of Corporate Units or Treasury Units, as the case may be, and bearing a Certificate number not contemporaneously outstanding. If there shall be delivered to the Company and the Purchase Contract Agent (i) evidence to their satisfaction of the destruction, loss or theft of any Certificate, and (ii) such security or indemnity as may be required by them to hold each of them and any agent of any of them harmless, then, in the absence of notice to the Company or the Purchase Contract Agent that such Certificate has been acquired by a bona fide purchaser, the Company shall execute and deliver to the Purchase Contract Agent, and the Purchase Contract Agent shall authenticate, execute on behalf of 26 the Holder, and deliver to the Holder, in lieu of any such destroyed, lost or stolen Certificate, a new Certificate, evidencing the same number of Corporate Units or Treasury Units, as the case may be, and bearing a Certificate number not contemporaneously outstanding. Notwithstanding the foregoing, the Company shall not be obligated to execute and deliver to the Purchase Contract Agent, and the Purchase Contract Agent shall not be obligated to authenticate, execute on behalf of the Holder, and deliver to the Holder, a Certificate on or after the Business Day immediately preceding the earlier of the Purchase Contract Settlement Date or the Termination Date. In lieu of delivery of a new Certificate, upon satisfaction of the applicable conditions specified above in this Section and receipt of appropriate registration or transfer instructions from such Holder, the Purchase Contract Agent shall: (1) if the Purchase Contract Settlement Date has occurred, deliver the shares of Common Stock issuable in respect of the Purchase Contracts forming a part of the Securities evidenced by such Certificate; or (2) if a Termination Event shall have occurred prior to the Purchase Contract Settlement Date, transfer the Senior Notes, the Treasury Portfolio or the Treasury Securities, as the case may be, evidenced thereby, in each case subject to the applicable conditions and in accordance with the applicable provisions of Article Five hereof. Upon the issuance of any new Certificate under this Section, the Company and the Purchase Contract Agent may require the payment by the Holder of a sum sufficient to cover any tax or other governmental charge that may be imposed in relation thereto and any other expenses (including the fees and expenses of the Purchase Contract Agent) connected therewith. Every new Certificate issued pursuant to this Section in lieu of any destroyed, lost or stolen Certificate shall constitute an original additional contractual obligation of the Company and of the Holder in respect of the Security evidenced thereby, whether or not the destroyed, lost or stolen Certificate (and the Securities evidenced thereby) shall be at any time enforceable by anyone, and shall be entitled to all the benefits and be subject to all the obligations of this Agreement equally and proportionately with any and all other Certificates delivered hereunder. The provisions of this Section are exclusive and shall preclude (to the extent lawful) all other rights and remedies with respect to the replacement or payment of mutilated, destroyed, lost or stolen Certificates. Section 3.11. Persons Deemed Owners. Prior to due presentment of a Certificate for registration of transfer, the Company and the Purchase Contract Agent, and any agent of the Company or the Purchase Contract Agent, may treat the Person in whose name such Certificate is registered as the owner of the Corporate Units or Treasury Units evidenced thereby, for the purpose of receiving interest payments on the Senior Notes, receiving Contract Adjustment Payments, performance of the Purchase Contracts and for all other purposes whatsoever, whether or not any interest payments on the Senior Notes or the Contract Adjustment Payments payable in respect of the Purchase Contracts constituting a part of the 27 Corporate Units or Treasury Units evidenced thereby shall be overdue and notwithstanding any notice to the contrary, and neither the Company nor the Purchase Contract Agent, nor any agent of the Company or the Purchase Contract Agent, shall be affected by notice to the contrary. Notwithstanding the foregoing, with respect to any Global Certificate, nothing contained herein shall prevent the Company, the Purchase Contract Agent or any agent of the Company or the Purchase Contract Agent, from giving effect to any written certification, proxy or other authorization furnished by any Clearing Agency (or its nominee), as a Holder, with respect to such Global Certificate or impair, as between such Clearing Agency and owners of beneficial interests in such Global Certificate, the operation of customary practices governing the exercise of rights of such Clearing Agency (or its nominee) as Holder of such Global Certificate. Section 3.12. Cancellation. All Certificates surrendered for delivery of shares of Common Stock on or after the Purchase Contract Settlement Date, upon the transfer of Senior Notes, the Treasury Portfolio or Treasury Securities, as the case may be, after the occurrence of a Termination Event or pursuant to an Early Settlement, or upon the registration of a transfer or exchange of a Security, or a Collateral Substitution or the reestablishment of Corporate Units shall, if surrendered to any Person other than the Purchase Contract Agent, be delivered to the Purchase Contract Agent and, if not already cancelled, shall be promptly cancelled by it. The Company may at any time deliver to the Purchase Contract Agent for cancellation any Certificates previously authenticated, executed and delivered hereunder which the Company may have acquired in any manner whatsoever, and all Certificates so delivered shall, upon Issuer Order, be promptly cancelled by the Purchase Contract Agent. No Certificates shall be authenticated, executed on behalf of the Holder and delivered in lieu of or in exchange for any Certificates cancelled as provided in this Section, except as expressly permitted by this Agreement. All cancelled Certificates held by the Purchase Contract Agent shall be disposed of by the Purchase Contract Agent in accordance with its customary procedures. If the Company or any Affiliate of the Company shall acquire any Certificate, such acquisition shall not operate as a cancellation of such Certificate unless and until such Certificate is delivered to the Purchase Contract Agent cancelled or for cancellation. Section 3.13. Creation of Treasury Units by Substitution of Treasury Securities. A Holder may separate the Senior Notes from the related Purchase Contracts in respect of such Holder's Corporate Units by substituting for such Senior Notes Treasury Securities in an aggregate principal amount equal to the aggregate principal amount of such Senior Notes (a "Collateral Substitution"), at any time from and after the date of this Agreement until 5:00 p.m. (New York City time) on the Election Date by providing notice to the Purchase Contract Agent, substantially in the form of Exhibit C hereto, of such Holder's intention to create Treasury Units and: (1) depositing with the Securities Intermediary Treasury Securities having an aggregate principal amount at maturity equal to the aggregate principal amount of the Senior Notes comprising part of such Corporate Units; and 28 (2) transferring the related Corporate Units to the Purchase Contract Agent accompanied by a notice to the Purchase Contract Agent, substantially in the form of Exhibit D hereto, stating that the Holder has transferred the relevant amount of Treasury Securities to the Securities Intermediary and requesting that the Purchase Contract Agent instruct the Collateral Agent to release the Senior Notes underlying such Corporate Units, whereupon the Purchase Contract Agent shall promptly give such instruction to the Collateral Agent, substantially in the form of Exhibit A to the Pledge Agreement. Upon receipt of the Treasury Securities described in clause (1) above and the instruction described in clause (2) above, in accordance with the terms of the Pledge Agreement, the Collateral Agent will cause the Securities Intermediary to effect the release of such Senior Notes from the Pledge to the Purchase Contract Agent, free and clear of the Company's security interest therein, and the transfer of such Senior Notes to the Purchase Contract Agent on behalf of the Holder. Upon receipt thereof, the Purchase Contract Agent shall promptly: (i) cancel the related Corporate Units; (ii) transfer the Senior Notes to the Holder; and (iii) authenticate, execute on behalf of such Holder and deliver a Treasury Unit Certificate executed by the Company in accordance with Section 3.3 of this Agreement evidencing the same number of Purchase Contracts as were evidenced by the cancelled Corporate Units. Holders who elect to separate the Senior Notes from the related Purchase Contracts and to substitute Treasury Securities for such Senior Notes shall be responsible for any fees or expenses payable to the Collateral Agent for its services as Collateral Agent in respect of the substitution, and the Company shall not be responsible for any such fees or expenses. Holders may make Collateral Substitutions only in integral multiples of 20 Corporate Units. Under no circumstances may a Holder of Corporate Units create Treasury Units after the Election Date. In the event a Holder making a Collateral Substitution pursuant to Section 3.13 of this Agreement fails to effect a book-entry transfer of the Corporate Units or fails to deliver Corporate Unit Certificates to the Purchase Contract Agent after depositing Treasury Securities with the Collateral Agent, the Senior Notes, constituting a part of such Corporate Units, and any interest payments on such Senior Notes, shall be held in the name of the Purchase Contract Agent or its nominee in trust for the benefit of such Holder, until such Corporate Units are so transferred or the Corporate Unit Certificates are so delivered, as the case may be, or, with respect to the Corporate Unit Certificates, such Holder provides evidence satisfactory to the Company and the Purchase Contract Agent that such Corporate Unit Certificates have been destroyed, lost or stolen, together with any indemnity that may be required by the Purchase Contract Agent and the Company. Except as described in this Section 3.13, for so long as the Purchase Contract underlying a Corporate Unit remains in effect, such Corporate Unit shall not be separable into its constituent parts, and the rights and obligations of the Holder in respect of the Senior Note or the 29 Treasury Portfolio Interest and the Purchase Contract comprising such Corporate Unit may be acquired, and may be transferred and exchanged, only as a Corporate Unit. Section 3.14. Reestablishment of Corporate Units. Unless a Tax Event Redemption has occurred, a Holder of a Treasury Unit may recreate Corporate Units at any time until 5:00 p.m. (New York City time) on the Election Date by providing notice to the Purchase Contract Agent, substantially in the form of Exhibit C hereto, of such Holder's intention to recreate Corporate Units and: (1) depositing with the Securities Intermediary Senior Notes having an aggregate principal amount equal to the aggregate principal amount at maturity of the Treasury Securities comprising part of the Treasury Units; and (2) transferring the related Treasury Units to the Purchase Contract Agent accompanied by a notice to the Purchase Contract Agent, substantially in the form of Exhibit D hereto, (i) stating that the Holder has transferred the relevant amount of Senior Notes to the Securities Intermediary and (ii) requesting that the Purchase Contract Agent instruct the Collateral Agent to release the Treasury Securities underlying such Treasury Units, whereupon the Purchase Contract Agent shall promptly give such instruction to the Collateral Agent, substantially in the form of Exhibit C to the Pledge Agreement. Upon receipt of the Senior Notes described in clause (1) above and the instruction described in clause (2) above, in accordance with the terms of the Pledge Agreement, the Collateral Agent will cause the Securities Intermediary to effect the release of such Treasury Securities from the Pledge to the Purchase Contract Agent, free and clear of the Company's security interest therein, and the transfer of such Treasury Securities to the Purchase Contract Agent on behalf of the Holder. Upon receipt thereof, the Purchase Contract Agent shall promptly: (i) cancel the related Treasury Units; (ii) transfer the Treasury Securities to the Holder; and (iii) authenticate, execute on behalf of such Holder and deliver a Corporate Unit Certificate executed by the Company in accordance with Section 3.3 evidencing the same number of Purchase Contracts as were evidenced by the cancelled Treasury Unit. Holders who elect to recreate Corporate Units shall be responsible for any fees or expenses payable to the Collateral Agent for its services as Collateral Agent in respect of the substitution, and the Company shall not be responsible for any such fees or expenses. Holders of Treasury Units may reestablish Corporate Units in integral multiples of 20 Treasury Units for 20 Corporate Units. Under no circumstances may a Holder of Treasury Units recreate Corporate Units after the Election Date. Except as provided in this Section 3.14, for so long as the Purchase Contract underlying a Treasury Unit remains in effect, such Treasury Unit shall not be separable into its constituent parts and the rights and obligations of the Holder of such Treasury Units in respect of the 30 1/20 of a Treasury Security and the Purchase Contract comprising such Treasury Units may be acquired, and may be transferred and exchanged, only as a Treasury Unit. Section 3.15. Transfer of Collateral upon Occurrence of Termination Event. Upon the occurrence of a Termination Event and the transfer to the Purchase Contract Agent of the Senior Notes, Treasury Portfolio Interests or the Treasury Securities, as the case may be, underlying the Corporate Units and the Treasury Units, as the case may be, pursuant to the terms of the Pledge Agreement, the Purchase Contract Agent shall request transfer instructions with respect to such Senior Notes, Treasury Portfolio Interests or Treasury Securities, as the case may be, from each Holder by written request, substantially in the form of Exhibit E hereto, mailed to such Holder at its address as it appears in the Corporate Unit Register or the Treasury Unit Register, as the case may be. Upon book-entry transfer of the Corporate Units or Treasury Units or delivery of a Corporate Unit Certificate or Treasury Unit Certificate to the Purchase Contract Agent with such transfer instructions, the Purchase Contract Agent shall transfer the Senior Notes, Treasury Portfolio Interests or Treasury Securities, as the case may be, underlying such Corporate Units or Treasury Units, as the case may be, to such Holder by book-entry transfer, or other appropriate procedures, in accordance with such instructions. In the event a Holder of Corporate Units or Treasury Units fails to effect such transfer or delivery, the Senior Notes, Treasury Portfolio Interests or Treasury Securities, as the case may be, underlying such Corporate Units or Treasury Units, as the case may be, and any interest thereon, shall be held in the name of the Purchase Contract Agent or its nominee in trust for the benefit of such Holder, until the earlier of: (1) such Corporate Units or Treasury Units are transferred or the Corporate Unit Certificate or Treasury Unit Certificate is surrendered or such Holder provides satisfactory evidence that such Corporate Unit Certificate or Treasury Unit Certificate has been destroyed, lost or stolen, together with any indemnity that may be required by the Purchase Contract Agent and the Company; and (2) the expiration of the time period specified in the abandoned property laws of the relevant state. Section 3.16. No Consent to Assumption. Each Holder of a Security, by acceptance thereof, shall be deemed expressly to have withheld any consent to the assumption under Section 365 of the Bankruptcy Code or otherwise, of the Purchase Contract by the Company or its trustee, receiver, liquidator or a person or entity performing similar functions in the event that the Company becomes the debtor under the Bankruptcy Code or subject to other similar state or federal law providing for reorganization or liquidation. 31 ARTICLE IV The Senior Notes Section 4.1. Interest Payments; Rights to Interest Preserved. Each Corporate Unit issued hereunder shall consist of the beneficial ownership by the Holder of one Senior Note issued pursuant to the Indenture or, if the Remarketing Senior Notes shall have been remarketed by the Remarketing Agent pursuant to the Remarketing Agreement or if a Tax Event Redemption has occurred before the Purchase Contract Settlement Date, the Treasury Portfolio Interest, in each case, subject to the Pledge thereof by such Holder under the Pledge Agreement. An interest payment on any Senior Note which is paid on any Payment Date or the portion of the proceeds of a Treasury Portfolio Interest equal to the interest payable on a Senior Note on the Purchase Contract Settlement Date (such portion the "Treasury Portfolio Return"), as the case may be, subject to receipt thereof by the Purchase Contract Agent from the Collateral Agent as provided by the terms of the Pledge Agreement, shall promptly be paid to the Person in whose name the Corporate Unit Certificate (or one or more Predecessor Corporate Unit Certificates) of which such Senior Note or the Treasury Portfolio Interest, as the case may be, is a part is registered at the close of business on the Record Date for such Payment Date or Purchase Contract Settlement Date, as applicable. Each Corporate Unit Certificate evidencing, in part, the Senior Note or the Treasury Portfolio Interest delivered under this Agreement upon registration of transfer of or in exchange for or in lieu of any other Corporate Unit Certificate shall carry the right to accrued and unpaid interest, and the right to accrue interest (and accreted and accreting principal in the case of non-interest bearing components of the Treasury Portfolio Interest), which rights were carried by the Senior Note or the Treasury Portfolio Interest, as the case may be, relating to such other Corporate Unit Certificate. In the case of any Corporate Unit with respect to which (1) Cash Settlement of the related Purchase Contract is effected on the fifth Business Day immediately preceding the Purchase Contract Settlement Date, (2) Early Settlement of the related Purchase Contract is effected on an Early Settlement Date or (3) a Collateral Substitution is effected, in each case, on a date that is after any Record Date and on or prior to the next succeeding Payment Date, the interest payment on the Senior Note or the Treasury Portfolio Return, as the case may be, relating to such Corporate Unit otherwise payable on such Payment Date shall be payable on such Payment Date notwithstanding such Cash Settlement, Early Settlement or Collateral Substitution, as the case may be, and such payment shall, subject to receipt thereof by the Purchase Contract Agent, be payable to the Person in whose name the Corporate Unit Certificate (or one or more Predecessor Corporate Unit Certificates) was registered at the close of business on the corresponding Record Date. Except as otherwise expressly provided in the immediately preceding sentence, in the case of any Corporate Unit with respect to which Cash Settlement or Early Settlement of the related Purchase Contract is effected on the fifth Business Day immediately preceding the Purchase Contract Settlement Date, or on an Early Settlement Date, respectively, or with respect to which a Collateral Substitution has been effected, interest payments on the related Senior Notes or the Treasury Portfolio Return, as the case may be, that would otherwise be payable after the fifth Business Day preceding the Purchase Contract Settlement Date, after the Early Settlement Date, or after the Collateral Substitution, respectively, 32 shall not be payable hereunder to the Holder of such Corporate Unit; provided, however, that to the extent that such Holder continues to hold the Separated Senior Note that formerly comprised a part of such Holder's Corporate Unit, such Holder shall be entitled to receive the interest payments on such Separated Senior Note, as provided in the Indenture. Section 4.2. Interest Rate Reset. Unless a Tax Event Redemption has occurred, the applicable interest rate borne by the Senior Notes, whether or not part of Corporate Units, shall be reset to the Reset Rate, pursuant to the Supplemental Indenture, and will be effective with respect to all Senior Notes, whether or not then constituting a component of Corporate Units, as of the Remarketing Settlement Date, in the case of a Successful Remarketing, or, as of the Purchase Contract Settlement Date, in the event of a Failed Remarketing or in the event there is no Remarketing pursuant to clause (iii) of the definition of Reset Rate in the Supplemental Indenture. Section 4.3. Notice and Voting. Under the terms of the Pledge Agreement, the Purchase Contract Agent will be entitled to exercise the voting and any other consensual rights pertaining to the Pledged Senior Notes, but it will do so only to the extent instructed in writing by the Holders as described below. Upon receipt of notice of any meeting at which holders of Senior Notes are entitled to vote or upon any solicitation of consents, waivers or proxies of holders of Senior Notes, the Purchase Contract Agent shall, as soon as practicable thereafter, mail to the Holders of Corporate Units a notice: (1) containing such information as is contained in the notice or solicitation; (2) stating that each Holder on the record date set by the Purchase Contract Agent therefor (which, to the extent possible, shall be the same date as the record date for determining the holders of Senior Notes entitled to vote) shall be entitled to instruct the Purchase Contract Agent as to the exercise of the voting rights pertaining to such Senior Notes underlying their Corporate Units; and (3) stating the manner in which such instructions may be given. Upon the written request of the Holders of Corporate Units on such record date received by the Purchase Contract Agent at least six days prior to such meeting or the expiration date of any such solicitation, the Purchase Contract Agent shall endeavor insofar as practicable to vote or cause to be voted, in accordance with the instructions set forth in such requests, the maximum principal amount of Senior Notes as to which any particular voting instructions are received. In the absence of specific instructions from the Holder of Corporate Units, the Purchase Contract Agent shall abstain from voting the Senior Notes underlying such Corporate Units. The Company hereby agrees, if applicable, to solicit Holders of Corporate Units to timely instruct the Purchase Contract Agent in order to enable the Purchase Contract Agent to vote such Senior Notes. Section 4.4. Tax Event Redemption. Upon the occurrence of a Tax Event Redemption prior to the Initial Remarketing Date, or in the event that there has not been a Successful Initial Remarketing or a Successful Subsequent 33 Remarketing, prior to the Purchase Contract Settlement Date, pursuant to the terms of the Pledge Agreement, the Collateral Agent will apply, out of the aggregate Redemption Price for the Senior Notes that are part of Corporate Units, an amount equal to the aggregate Redemption Amount for the Senior Notes that are part of Corporate Units to purchase on behalf of the Holders of Corporate Units the Redemption Treasury Portfolio and promptly remit the remaining portion, if any, of such Redemption Price to the Purchase Contract Agent for payment to the Holders of such Corporate Units. The Redemption Treasury Portfolio will be substituted for the Pledged Senior Notes, and will be held by the Collateral Agent in accordance with the terms of the Pledge Agreement to secure the obligation of each Holder of a Corporate Unit to purchase Common Stock of the Company under the Purchase Contract constituting a part of such Corporate Unit. Following the occurrence of a Tax Event Redemption prior to the Initial Remarketing Date, or in the event that there has not been a Successful Initial Remarketing or a Successful Subsequent Remarketing, prior to the Purchase Contract Settlement Date, the Holders of the Corporate Units and the Collateral Agent shall have such security interests, rights and obligations with respect to the Redemption Treasury Portfolio as the Holders and the Collateral Agent, respectively, had with respect to the Senior Notes, subject to the Pledge thereof as provided in the Pledge Agreement, and any reference herein or in the Certificates to the Senior Note shall be deemed to be a reference to such Redemption Treasury Portfolio and any reference herein or in the Certificates to interest on the Senior Notes shall be deemed to be a reference to corresponding distributions on the Redemption Treasury Portfolio. The Company may cause to be made in any Corporate Units Certificate thereafter to be issued such change in phraseology and form (but not in substance) as may be appropriate to reflect the substitution of the Redemption Treasury Portfolio for Senior Notes as collateral. Upon the occurrence of a Tax Event Redemption after the Purchase Contract Settlement Date, the Redemption Price will be payable in cash to the holders of the Senior Notes. ARTICLE V The Purchase Contracts Section 5.1. Purchase of Shares of Common Stock. Each Purchase Contract shall, unless an Early Settlement has occurred in accordance with Section 5.9 hereof, obligate the Holder of the related Security to purchase, and the Company to sell, on the Purchase Contract Settlement Date at a price equal to the Stated Amount (the "Purchase Price"), a number of newly issued shares of Common Stock equal to the Settlement Rate unless, on or prior to the Purchase Contract Settlement Date, there shall have occurred a Termination Event with respect to the Security of which such Purchase Contract is a part. The "Settlement Rate" is equal to: (1) if the Applicable Market Value (as defined below) is equal to or greater than $81.33 (the "Threshold Appreciation Price"), 0.6148 shares of Common Stock per Purchase Contract; (2) if the Applicable Market Value is less than the Threshold Appreciation Price, but greater than $59.80 (the "Reference Price"), the number of shares of Common Stock having a value, based on the Applicable Market Value, equal to the Stated Amount; and 34 (3) if the Applicable Market Value is less than or equal to the Reference Price, 0.8361 shares of Common Stock per Purchase Contract, in each case subject to adjustment as provided in Section 5.6 (and in each case rounded upward or downward to the nearest 1/10,000th of a share). Promptly after the calculation of the Settlement Rate and the Applicable Market Value, the Company shall give the Purchase Contract Agent notice thereof. All calculations and determinations of the Settlement Rate and the Applicable Market Value shall be made by the Company or its agent and the Purchase Contract Agent shall have no responsibility with respect thereto. As provided in Section 5.10, no fractional shares of Common Stock will be issued upon settlement of Purchase Contracts. The "Applicable Market Value" means the average of the Closing Price per share of Common Stock on each of the 20 Trading Days ending on the third Trading Day immediately preceding the Purchase Contract Settlement Date. The "Closing Price" per share of the Common Stock on any date of determination means: (1) the closing sale price (or, if no closing price is reported, the last reported sale price) per share of the Common Stock on the New York Stock Exchange (the "NYSE") on such date; (2) if the Common Stock is not listed for trading on the NYSE on any such date, the closing sale price per share as reported in the composite transactions for the principal United States securities exchange on which the Common Stock is so listed; (3) if the Common Stock is not so listed on a United States national or regional securities exchange, the closing sale price per share as reported by The Nasdaq Stock Market; (4) if the Common Stock is not so reported, the last quoted bid price per share for the Common Stock in the over-the-counter market as reported by the National Quotation Bureau or similar organization; or (5) if such bid price is not available, the average of the mid-point of the last bid and ask prices per share of the Common Stock on such date from at least three nationally recognized independent investment banking firms retained for this purpose by the Company. A "Trading Day" means a day on which the Common Stock (1) is not suspended from trading on any national or regional securities exchange or association or over-the-counter market at the close of business and (2) has traded at least once on the national or regional securities exchange or association or over-the-counter market that is the primary market for the trading of the Common Stock. Each Holder of a Corporate Unit or a Treasury Unit, by its acceptance thereof: 35 (1) irrevocably authorizes the Purchase Contract Agent to enter into and perform the related Purchase Contract on its behalf as its attorney-in-fact (including the execution of Certificates on behalf of such Holder); (2) agrees to be bound by the terms and provisions thereof; (3) covenants and agrees to perform its obligations under such Purchase Contracts; (4) consents to the provisions hereof; (5) irrevocably authorizes the Purchase Contract Agent to enter into and perform this Agreement and the Pledge Agreement on its behalf as its attorney-in-fact; (6) consents to and agrees to be bound by the Pledge of the Senior Notes or the Treasury Securities pursuant to the Pledge Agreement; and (7) agrees to treat itself as the owner of the related Senior Notes, Treasury Portfolio Interest or Treasury Securities, as the case may be, in each case for Federal, state and local income and franchise tax purposes. provided that upon a Termination Event, the rights of the Holder of such Security under the Purchase Contract may be enforced without regard to any other rights or obligations. Each Holder of a Corporate Unit or a Treasury Unit, by its acceptance thereof, further covenants and agrees, that to the extent and in the manner provided in Section 5.4 and the Pledge Agreement, but subject to the terms thereof, Proceeds from the Remarketing of the Senior Notes or the Proceeds from the Treasury Securities at maturity on the Purchase Contract Settlement Date, as the case may be, shall be paid by the Collateral Agent to the Company in satisfaction of such Holder's obligations under such Purchase Contract and such Holder shall acquire no right, title or interest in such payments. Upon registration of transfer of a Certificate, the transferee shall be bound (without the necessity of any other action on the part of such transferee) by the terms of this Agreement, the Purchase Contracts underlying such Certificate and the Pledge Agreement and the transferor shall be released from the obligations under this Agreement, the Purchase Contracts underlying the Certificates so transferred and the Pledge Agreement. The Company covenants and agrees, and each Holder of a Certificate, by its acceptance thereof, likewise covenants and agrees, to be bound by the provisions of this paragraph. Section 5.2. Contract Adjustment Payments. The Company shall pay, on each Payment Date, the Contract Adjustment Payments payable in respect of each Purchase Contract to the Person in whose name a Certificate (or one or more Predecessor Certificates) is registered at the close of business on the Record Date next preceding such Payment Date in such coin or currency of the United States as at the time of payment shall be legal tender for the payment of public and private debts. The Contract Adjustment Payments will be payable at the office of the Purchase Contract Agent in The City of New York maintained for that purpose or, at the option of the Company, by check mailed to the address of the Person entitled thereto at such Person's address as it appears on the Corporate Unit Register or Treasury Unit Register. If any date on which Contract Adjustment Payments are to be made is not a Business Day, then payment of the Contract Adjustment Payments payable on such date will be made on the next day that is a Business Day (and without any interest in respect of any such delay), except that, if such Business Day is in the next calendar year, such payment will be made on the preceding Business Day. Upon the occurrence of a Termination Event, the Company's obligation to pay Contract Adjustment Payments (including any accrued Contract Adjustment Payments) shall cease. Each Certificate delivered under this Agreement upon registration of transfer of or in exchange for or in lieu of (including as a result of a Collateral Substitution or the reestablishment of Corporate Units) any other Certificate shall carry the right to accrued and unpaid Contract Adjustment Payments, and the right to accrue Contract Adjustment Payments, which rights were carried by the Purchase Contracts underlying such other Certificates. Subject to Section 5.9, in the case of any Security with respect to which (1) Cash Settlement of the underlying Purchase Contract is effected on the fifth Business Day immediately preceding the Purchase Contract Settlement Date or (2) Early Settlement of the underlying Purchase Contract is effected on an Early Settlement Date, in each case, on a date that is after any Record Date and on or prior to the next succeeding Payment Date, Contract Adjustment Payments otherwise payable on such Payment Date shall be payable on such Payment Date notwithstanding such Cash Settlement or Early Settlement, as the case may be, and such Contract Adjustment Payments shall be paid to the Person in whose name the Certificate evidencing such Security (or one or more Predecessor Certificates) is registered at the close of business on such Record Date. Except as otherwise expressly provided in the immediately preceding sentence, in the case of any Security with respect to which Cash Settlement or Early Settlement of the underlying Purchase Contract is effected on the fifth Business Day immediately preceding the Purchase Contract Settlement Date or on an Early Settlement Date, respectively, Contract Adjustment Payments that would otherwise be payable after the fifth Business Day immediately preceding the Purchase Contract Settlement Date or after the Early Settlement Date with respect to such Purchase Contract shall not be payable. Promptly after the calculation of any adjustment to the Contract Adjustment Payments arising from a Reset Transaction, the Company shall give the Purchase Contract Agent notice thereof. All calculations and determinations of the Adjusted Contract Adjustment Payment Rate shall be made by the Company or its agent and the Purchase Contract Agent shall have no responsibility with respect thereto. The Purchase Contract Agent shall not at any time be under any duty or responsibility to any Holder of Securities to determine whether any facts exist which may require any adjustment to the Contract Adjustment Payments, or with respect to the nature or extent or calculation of any such adjustment when made, or with respect to the method employed in making the same. Section 5.3. [Intentionally omitted.] Section 5.4. Payment of Purchase Price; Remarketing. (a) Unless a Termination Event or a Tax Event Redemption has occurred or a Holder has settled the related Purchase Contract through a Cash Settlement pursuant to Section 5.9 or an Early Settlement pursuant to Section 5.9, the settlement of the Purchase Contract relating to a Security will be made by Remarketing in accordance with this Section 5.4. 37 (b) The Company shall engage Salomon Smith Barney Inc., or another nationally recognized investment bank, to act as Remarketing Agent (the "Remarketing Agent") pursuant to the Remarketing Agreement to remarket (1) the Pledged Senior Notes comprising part of Corporate Units, other than those Pledged Senior Notes of Holders that have elected not to participate in the Remarketing by creating Treasury Units pursuant to Section 5.4(f) below, and (2) the Separated Senior Notes of holders of Separated Senior Notes that have elected to participate in the Remarketing pursuant to paragraph 106 of the Supplemental Indenture and Section 5.7 of the Pledge Agreement (the Senior Notes described in clauses (1) and (2) collectively being referred to as the "Remarketing Senior Notes") pursuant to the Remarketing Procedures. On the seventh Business Day prior to the Initial Remarketing Date, the Company shall give notice of Remarketing in an Authorized Newspaper, including the specific U.S. Treasury security or securities (including the CUSIP number and/or the principal terms of such Treasury security or securities) that must be delivered by Holders of Corporate Units that elect not to participate in the Remarketing pursuant to Section 5.4(f) below, no later than 5:00 p.m. (New York City time) on the Election Date. Not later than 15 calendar days nor more than 30 calendar days prior to the Initial Remarketing Date, the Company shall request DTC (or any successor Clearing Agency), to notify its Beneficial Owners or Clearing Agency Participants holding Corporate Units or Separate Senior Notes of the impending Remarketing. The Purchase Contract Agent shall notify, by 11:00 a.m. (New York City time), on the Business Day immediately preceding the Initial Remarketing Date, the Remarketing Agent, the Collateral Agent, the Trustee and the Company, by use of a notice substantially in the form of Exhibit G hereto, of the aggregate principal amount of Pledged Senior Notes of Corporate Units Holders to be remarketed on the Initial Remarketing Date or Subsequent Remarketing Date, as applicable, and the Collateral Agent, pursuant to the Pledge Agreement, having separately notified the Remarketing Agent, the Trustee and the Company of the aggregate principal amount of Separated Senior Notes to be included on the Initial Remarketing Date or Subsequent Remarketing Date, as applicable, by 11:00 a.m. (New York City time), on the Business Day immediately preceding the Initial Remarketing Date, shall concurrently therewith, pursuant to the Pledge Agreement, deliver for Remarketing to the Remarketing Agent all Remarketing Senior Notes. Upon receipt of such notice from the Purchase Contract Agent and the Collateral Agent and such Remarketing Senior Notes from the Collateral Agent, the Remarketing Agent, pursuant to the Remarketing Agreement, will, use its commercially reasonable efforts to remarket such Remarketing Senior Notes on such date pursuant to the Remarketing Procedures and the Remarketing Agreement. If there has been a Successful Initial Remarketing or a Successful Subsequent Remarketing, the Remarketing Agent will on the Remarketing Settlement Date (i) deduct and retain for itself as the remarketing fee for itself an amount not exceeding 25 basis points (0.25%) of the principal amount of each remarketed Remarketing Senior Note (the "Remarketing Fee"), (ii) use the remaining proceeds attributable to the Pledged Senior Notes from such Successful Remarketing to purchase the appropriate U.S. Treasury securities (the "Treasury Portfolio" and the related interest in the Treasury Portfolio applicable to a Corporate Unit, the "Treasury Portfolio Interest") with the CUSIP numbers, if any, selected by Remarketing Agent, described in clauses (1)(i) and (2)(i) of the definition of Remarketing Value related to the Senior Notes of Holders of Corporate Units that were 38 remarketed, (iii) if any Separated Senior Notes were remarketed, remit to the Collateral Agent for payment to the holders of such Separated Senior Notes the amounts specified in clauses 1(ii) and 2(ii) of the definition of Remarketing Value and (iv) if there then remain any proceeds from such Successful Remarketing, after the application of such proceeds as set forth in clauses (i) through (iii) above of this sentence, then remit any such remaining proceeds to the Purchase Contract Agent for the benefit of holders of the remarketed Senior Notes and to the Collateral Agent for the benefit of the holders of such Separated Senior Notes, on a pro rata basis, provided, however, that if such Successful Remarketing is consummated after 4:30 p.m. (New York City time) on the Remarketing Date and, despite using its commercially reasonable efforts, the Remarketing Agent cannot cause the applications of the proceeds specified above to occur on the Remarketing Settlement Date, then the Remarketing Agent may make such applications and remittances on the next succeeding Business Day. Holders of Remarketing Senior Notes that are so remarketed will not otherwise be responsible for the payment of any remarketing fee or expenses in connection with the Remarketing. On the Remarketing Settlement Date or the next succeeding Business Day, as applicable, the Remarketing Agent shall deliver the Treasury Portfolio to the Collateral Agent. The Collateral Agent, for the benefit of the Company, will thereupon apply such Treasury Portfolio, in accordance with the Pledge Agreement, to secure such Holders' obligations under the Purchase Contracts. In the event that all or any portion of the Pledged Treasury Portfolio Interest matures before the Purchase Contract Settlement Date, the Collateral Agent shall invest the proceeds therefrom in Permitted Investments in accordance with the Pledge Agreement. The Collateral Agent shall cause the Securities Intermediary to remit, on the Purchase Contract Settlement Date, a portion of the proceeds of the maturing Pledged Treasury Portfolio Interest and of the investment earnings from the related investment in Permitted Investments, in each case, in an amount equal to the Treasury Portfolio Return to the Purchase Contract Agent for the benefit of the Holders of the related Corporate Units when received. Without receiving any instruction from any such Holder of Corporate Units, the Collateral Agent shall apply, on the Purchase Contract Settlement Date, the proceeds of the maturing Pledged Treasury Portfolio Interest and of the investment earnings from the related investment in Permitted Investments in an aggregate amount equal to the aggregate Purchase Price applicable to such Corporate Units to satisfy in full such Holder's obligations to pay the Purchase Price to purchase the shares of Common Stock under the related Purchase Contracts on the Purchase Contract Settlement Date. In the event the sum of the proceeds from the related Pledged Treasury Portfolio Interest and the investment earnings from the related investment in Permitted Investments exceeds the sum of the related Treasury Portfolio Return and the aggregate Purchase Price of the Purchase Contracts being settled thereby, the Collateral Agent shall instruct the Securities Intermediary to distribute such excess, when received, to the Purchase Contract Agent for distribution to the Holders whose Purchase Contracts were settled with such proceeds, on a pro rata basis. If, by 4:00 p.m. (New York City time), on the ninth Business Day preceding the Purchase Contract Settlement Date, the Remarketing Agent, despite using its commercially reasonable efforts, has been and is unable to remarket all of the Remarketing Senior Notes tendered for purchase at a price equal to at least the Remarketing Value, the Remarketing Agent shall Transfer to the Collateral Agent, by the sixth Business Day preceding the Purchase Contract Settlement Date, the Pledged Senior Notes that that were to be remarketed in the Initial or Subsequent Remarketing, whereupon the Collateral Agent shall, for the benefit of the Company, hold such Pledged Senior Notes, to secure the obligation of the related Holders of Corporate Units to purchase Common Stock under the related 39 Purchase Contracts. (c) Pursuant to the Supplemental Indenture and the Remarketing Agreement, holders of Separated Senior Notes may elect to have such Separated Senior Note remarketed if such holder, on or prior to 5:00 p.m. (New York City time) on the Election Date, delivers (i) to the Trustee and the Collateral Agent a notice of that election, substantially in the form of Exhibit H specifying the aggregate principal amount of Senior Notes to be remarketed, and (ii) such Separated Senior Notes, by book-entry transfer or other appropriate procedures, to the Collateral Agent for Remarketing, in each case, pursuant to the Indenture. Once the holder of such Separated Senior Notes delivers such notice and Separated Senior Notes as specified in the preceding sentence, such election may not be withdrawn and may not be conditioned upon the level at which the Reset Rate is established in the Remarketing; provided, however, that if such a holder delivers only such a notice but not the Separated Senior Notes subject to the notice, then none of such holder's Separated Senior Notes shall be included in the Remarketing. (d) Unless a Termination Event has occurred or a Holder has settled the related Purchase Contract through a Cash Settlement or an Early Settlement or a Successful Initial Remarketing, or a Successful Subsequent Remarketing or a Tax Event Redemption has occurred, each Holder shall be deemed to have consented to the Remarketing of such Holder's Pledged Senior Notes in the Final Remarketing on the Final Remarketing Date. The Purchase Contract Agent, shall by 11:00 a.m. (New York City time), on the Business Day immediately preceding the Final Remarketing Date, notify the Remarketing Agent, the Collateral Agent, the Trustee and the Company, by use of a notice substantially in the form of Exhibit G hereto, of such event and of the aggregate principal amount of Pledged Senior Notes of Corporate Units Holders to be remarketed on the Final Remarketing Date, whereupon the Collateral Agent, shall concurrently therewith, without any instruction from such Holder of Corporate Units with respect to their Pledged Senior Notes, transfer the Remarketing Senior Notes to the Remarketing Agent for Remarketing. Upon receiving such Remarketing Senior Notes, the Remarketing Agent, pursuant to the terms of the Remarketing Agreement, will use its commercially reasonable efforts to remarket such Remarketing Senior Notes on the Final Remarketing Date. If a Successful Final Remarketing shall have occurred, the Remarketing Agent will on the Remarketing Settlement Date or Purchase Contract Settlement Date, as applicable, (i) deduct and retain for itself the Remarketing Fee, pursuant to the Remarketing Agreement, (ii) cause the remaining proceeds of the Remarketing with respect to the Pledged Senior Notes in an amount equal to the aggregate principal amount of such Senior Notes to be delivered to the Collateral Agent, on the Remarketing Settlement Date, (iii) if any Separated Senior Notes were remarketed, remit to the Collateral Agent for payment to the holders of such Separated Senior Notes sold in the Remarketing the remaining proceeds from such Successful Remarketing attributable to the Separated Senior Notes in an amount equal to the principal amount of such Senior Notes and (iv) if there remain any proceeds from such Successful Remarketing, after the application of such proceeds as set forth in clauses (i) through (iii) of this sentence, then remit such remaining proceeds to the Purchase Contract Agent for the benefit of the holders of the Pledged Senior Notes and to the Collateral Agent for the benefit of holders of Separated Senior Notes, on a pro rata basis, provided, however, that if such Successful Final Remarketing is consummated after 4:30 p.m. (New York City time) on the Remarketing Date and, despite using its commercially reasonable efforts, the Remarketing Agent cannot cause the 40 application of the proceeds specified above to occur on the Remarketing Settlement Date, then the Remarketing Agent may make such applications and remittances on the next succeeding Business Day. Holders of the Remarketing Senior Notes that are so remarketed will not otherwise be responsible for the payment of any remarketing fee or expenses in connection with the Remarketing. The Purchase Contract Agent shall give written directions to the Collateral Agent, and the Collateral Agent shall instruct the Securities Intermediary, to apply a portion of the Proceeds with respect to the Pledged Senior Notes from such Remarketing, on the Purchase Contract Settlement Date, equal to the aggregate principal amount of such Pledged Senior Notes to satisfy in full the obligations of such Holders of Corporate Units to pay the Purchase Price to purchase the shares of Common Stock under the related Purchase Contracts. If, (1) by 4:00 p.m. (New York City time), on the Final Remarketing Date, despite using its commercially reasonable efforts, the Remarketing Agent cannot remarket the Senior Notes included in the Remarketing at a price equal to at least the Remarketing Value, or (2) the Remarketing Agent has determined that the Remarketing may not be consummated as contemplated herein and by the Remarketing Procedures under applicable law, the Remarketing will be deemed to have failed (a "Failed Remarketing"). If a Failed Remarketing occurs, the Remarketing Agent will, pursuant to the Remarketing Agreement, promptly advise the Trustee, the Purchase Contract Agent, the Collateral Agent and the Company that a Failed Remarketing has occurred, whereupon the Company shall notify the Clearing Agency that a Failed Remarketing has occurred. The Collateral Agent, under the Pledge Agreement and for the benefit, and on behalf, of the Company, may exercise its rights as a secured party with respect to such Pledged Senior Notes, including those actions specified in paragraph (e) below; provided that, if upon a Failed Remarketing, the Collateral Agent exercises such rights for the benefit of the Company with respect to such Pledged Senior Notes, any accumulated and unpaid interest on such Senior Notes will become payable by the Company to the Purchase Contract Agent for payment to the Holders of the Corporate Units to which such Pledged Senior Notes relate. Such payment will be made by the Company on or prior to 11:00 a.m. (New York City time), on the Purchase Contract Settlement Date in lawful money of the United States by certified or cashiers' check or wire transfer in immediately available funds payable to or upon the order of the Purchase Contract Agent. The Company will cause a notice of any Failed Remarketing to be sent to the holders of all Senior Notes and to be published in an Authorized Newspaper, in each case, no later than on the Business Day immediately preceding the Purchase Contract Settlement Date. (e) With respect to any Pledged Senior Notes which are the subject of a Failed Remarketing, the Collateral Agent, for the benefit of the Company, and upon written direction of the Company as provided in the Pledge Agreement, reserves all of its rights as a secured party with respect thereto and, subject to applicable law and paragraph (f) below, may (i) retain such Senior Notes in full satisfaction of the Holders' obligations under the related Purchase Contracts or (ii) sell such Senior Notes in one or more public or private sales. (f) A Holder of Corporate Units may elect not to participate in the Remarketing by creating Treasury Units by notifying the Purchase Contract Agent of such election and complying with the procedures for creating Treasury Units set forth in Section 3.13 until 5:00 p.m. (New York City time) on the Election Date. A Holder that does not so create Treasury Units by delivering the Treasury Security or Treasury Securities pursuant to this paragraph and Section 3.13 shall be deemed 41 to have elected to participate in any Remarketing. (g) In the event that all or any portion of the Pledged Treasury Securities of Treasury Units matures before the Purchase Contract Settlement Date, the Collateral Agent shall invest the proceeds therefrom in Permitted Investments in accordance with the Pledge Agreement. Without receiving any instruction from any such Holder of Treasury Units, the Collateral Agent shall apply, on the Purchase Contract Settlement Date, the proceeds of the maturing Pledged Treasury Securities and of the investment earnings from the related investment in Permitted Investments, in each case, in an amount equal to the aggregate Purchase Price applicable to such Treasury Units to satisfy in full such Holder's obligations to pay the Purchase Price to purchase the shares of Common Stock under the related Purchase Contracts on the Purchase Contract Settlement Date. In the event the sum of the proceeds from the related Pledged Treasury Securities and the investment earnings from the related investment in Permitted Investments exceeds the aggregate Purchase Price of the Purchase Contracts being settled thereby, the Collateral Agent shall instruct the Securities Intermediary to distribute such excess, when received, to the Purchase Contract Agent for distribution to the Holders whose Purchase Contracts were settled with such proceeds, on a pro rata basis. (h) In the event that following a Tax Event Redemption, all or any portion of the Pledged Treasury Portfolio Interest matures before the Purchase Contract Settlement Date, the Collateral Agent shall invest the proceeds therefrom in Permitted Investments in accordance with the Pledge Agreement. The Collateral Agent shall cause the Securities Intermediary to remit, on the Purchase Contract Settlement Date, a portion of the proceeds of the maturing Pledged Treasury Portfolio Interest and of the investment earnings from the related investment in Permitted Investments, in each case, in an amount equal to the Treasury Portfolio Return to the Purchase Contract Agent for the benefit of the Holders of the related Corporate Units when received. Without receiving any instruction from any such Holder of Corporate Units, the Collateral Agent shall apply, on the Purchase Contract Settlement Date, the proceeds of the maturing Pledged Treasury Portfolio Interest and of the investment earnings from the related investment in Permitted Investments in an aggregate amount equal to the aggregate Purchase Price applicable to such Corporate Units to satisfy in full such Holder's obligations to pay the Purchase Price to purchase the shares of Common Stock under the related Purchase Contracts on the Purchase Contract Settlement Date. In the event the sum of the proceeds from the related Pledged Treasury Portfolio Interest and the investment earnings from the related investment in Permitted Investments exceeds the sum of the related Treasury Portfolio Return and the aggregate Purchase Price of the Purchase Contracts being settled thereby, the Collateral Agent shall instruct the Securities Intermediary to distribute such excess, when received, to the Purchase Contract Agent for distribution to the Holders whose Purchase Contracts were settled with such proceeds, on a pro rata basis. (i) Any distributions to Holders of excess funds and interest described in paragraphs (b), (d), (g) and (h) above shall be payable at the office of the Purchase Contract Agent in The City of New York maintained for that purpose or, at the option of the Holder, or the holder of Separated Senior Notes, as applicable, by check mailed to the address of the Person entitled thereto at such address as it appears on the Register or by wire transfer to an account specified to the Purchase Contract Agent by the Holder, or the holder of Separated Senior Notes, as applicable at least five 42 Business Days before such payment. (j) The obligations of each Holder to pay the Purchase Price are non-recourse obligations and except to the extent paid by Cash Settlement or Early Settlement, are payable solely out of the proceeds of any Collateral pledged to secure the obligations of the Holders, and in no event shall Holders be liable for any deficiency between such payments and the Purchase Price. (k) Notwithstanding anything to the contrary herein, the Company shall not be obligated to issue any Common Stock in respect of a Purchase Contract or deliver any certificates therefor to the Holder of the related Units unless the Company shall have received payment in full of the aggregate Purchase Price for the shares of Common Stock to be purchased thereunder by such Holder in the manner herein set forth, which payment, in the case of Corporate Units upon the occurrence of a Failed Remarketing, shall occur by the resale of Pledged Senior Notes or foreclosure on and retention of such Pledged Senior Notes. Section 5.5. Issuance of Shares of Common Stock. Unless a Termination Event or an Early Settlement shall have occurred, subject to Section 5.6(b), the Company shall issue and deposit with the Purchase Contract Agent, for the benefit of the Holders of the Outstanding Securities, one or more certificates representing the newly issued shares of Common Stock registered in the name of the Purchase Contract Agent (or its nominee) as custodian for the Holders (such certificates for shares of Common Stock, together with any dividends or distributions for which a record date and payment date for such dividend or distribution has occurred after the Purchase Contract Settlement Date, being hereinafter referred to as the "Purchase Contract Settlement Fund") to which the Holders are entitled hereunder. Subject to the foregoing, upon surrender of a Certificate to the Purchase Contract Agent on or after the Purchase Contract Settlement Date, together with settlement instructions thereon duly completed and executed, the Holder of such Certificate shall be entitled to receive in exchange therefor a certificate representing that number of whole shares of Common Stock which such Holder is entitled to receive pursuant to the provisions of this Article Five (after taking into account all Securities then held by such Holder), together with cash in lieu of fractional shares as provided in Section 5.10 and any dividends or distributions with respect to such shares constituting part of the Purchase Contract Settlement Fund, but without any interest thereon (or, if such Certificate is not surrendered to the Purchase Contract Agent or if no such instructions are given to the Purchase Contract Agent by the Holder, the Purchase Contract Agent shall hold such Certificate representing shares of Common Stock, cash in lieu of fractional shares and dividends or distributions, as applicable, in the name of the Purchase Contract Agent or its nominee in trust for the benefit of such Holder until the expiration of the time period specified in the abandoned property laws of the relevant state), and the Certificate so surrendered shall forthwith be cancelled. Such shares shall be registered in the name of the Holder or the Holder's designee as specified in the settlement instructions provided by the Holder to the Purchase Contract Agent. If any shares of Common Stock issued in respect of a Purchase Contract are to be registered to a Person other than the Person in whose name the Certificate evidencing such Purchase Contract is registered, no such registration shall be made unless the Person requesting such registration has paid any transfer and other taxes required by reason of such registration in a name other than that of the registered Holder of the Certificate evidencing such 43 Purchase Contract or has established to the satisfaction of the Company that such tax either has been paid or is not payable. Section 5.6. Adjustment of Settlement Rate. (a) Adjustments for Dividends, Distributions, Stock Splits, Etc. (1) In case the Company shall pay or make a dividend or other distribution on the Common Stock in Common Stock, the Settlement Rate in effect at the opening of business on the day following the date fixed for the determination of shareholders entitled to receive such dividend or other distribution shall be increased by dividing such Settlement Rate by a fraction of which: (i) the numerator shall be the number of shares of Common Stock outstanding at the close of business on the date fixed for such determination; and (ii) and the denominator shall be the sum of such number of shares and the total number of shares constituting such dividend or other distribution, such increase to become effective immediately after the opening of business on the day following the date fixed for such determination. For the purposes of this paragraph (1), the number of shares of Common Stock at any time outstanding shall not include shares held in the treasury of the Company but shall include any shares issuable in respect of any scrip certificates issued in lieu of fractions of shares of Common Stock. The Company will not pay any dividend or make any distribution on shares of Common Stock held in the treasury of the Company. (2) In case the Company shall issue rights, options or warrants to all holders of Common Stock (not being available on an equivalent basis to Holders of the Securities upon settlement of the Purchase Contracts underlying such Securities) entitling them, for a period expiring within 45 days after the record date for the determination of shareholders entitled to receive such rights, options or warrants, to subscribe for or purchase shares of Common Stock at a price per share less than the Current Market Price per share of Common Stock on the date fixed for the determination of shareholders entitled to receive such rights, options or warrants (other than pursuant to a dividend reinvestment plan), the Settlement Rate in effect at the opening of business on the day following the date fixed for such determination shall be increased by dividing such Settlement Rate by a fraction of which: (i) the numerator shall be the number of shares of Common Stock outstanding at the close of business on the date fixed for such determination plus the number of shares of Common Stock which the aggregate of the offering price of the total number of shares of Common Stock so offered for subscription or purchase would purchase at such Current Market Price; and (ii) the denominator shall be the number of shares of Common Stock outstanding at the close of business on the date fixed for such determination plus the number of shares of Common Stock so offered for subscription or purchase, 44 such increase to become effective immediately after the opening of business on the day following the date fixed for such determination. For the purposes of this paragraph (2), the number of shares of Common Stock at any time outstanding shall not include shares held in the treasury of the Company but shall include any shares issuable in respect of any scrip certificates issued in lieu of fractions of shares of Common Stock. The Company shall not issue any such rights, options or warrants in respect of shares of Common Stock held in the treasury of the Company. (3) In case outstanding shares of Common Stock shall be subdivided or split into a greater number of shares of Common Stock, the Settlement Rate in effect at the opening of business on the day following the day upon which such subdivision or split becomes effective shall be proportionately increased, and, conversely, in case outstanding shares of Common Stock shall each be combined into a smaller number of shares of Common Stock, the Settlement Rate in effect at the opening of business on the day following the day upon which such combination becomes effective shall be proportionately reduced, such increase or reduction, as the case may be, to become effective immediately after the opening of business on the day following the day upon which such subdivision, split or combination becomes effective. (4) In case the Company shall, by dividend or otherwise, distribute to all holders of Common Stock evidences of its indebtedness or assets (including securities, but excluding any rights, options or warrants referred to in paragraph (2) of this Section 5.6(a), any dividend or distribution paid exclusively in cash and any dividend or distribution referred to in paragraph (1) of this Section 5.6(a)), the Settlement Rate shall be adjusted so that the same shall equal the rate determined by dividing the Settlement Rate in effect immediately prior to the close of business on the date fixed for the determination of shareholders entitled to receive such distribution by a fraction of which: (i) the numerator shall be the Current Market Price per share of Common Stock on the date fixed for such determination less the then fair market value (as determined by the Board of Directors, whose determination shall be conclusive and described in a Board Resolution) of the portion of the assets or evidences of indebtedness so distributed applicable to one share of Common Stock; and (ii) the denominator shall be such Current Market Price per share of Common Stock, such adjustment to become effective immediately prior to the opening of business on the day following the date fixed for the determination of shareholders entitled to receive such distribution. In any case in which this paragraph (4) is applicable, paragraph (2) of this Section 5.6(a) shall not be applicable. (5) In case the Company shall, by dividend or otherwise, distribute to all holders of Common Stock (I) cash (excluding any cash that is distributed in a Reorganization Event to which Section 5.6(b) applies or as part of a distribution referred to in paragraph (4) of this Section 5.6(a)) in an aggregate amount that, combined together with the aggregate amount of any other distributions to all holders of Common Stock made exclusively in cash (other than 45 in connection with a Reorganization Event) within the 12 months preceding the date of payment of such distribution and in respect of which no adjustment pursuant to this paragraph (5) or paragraph (6) of this Section 5.6(a) has been made and (II) the aggregate of any cash plus the fair market value (as determined by the Board of Directors, whose determination shall be conclusive and described in a Board Resolution) of consideration payable in respect of any tender or exchange offer by the Company or any of its subsidiaries for all or any portion of Common Stock concluded within the 12 months preceding the date of payment of the distribution described in Clause (I) above and in respect of which no adjustment pursuant to this paragraph (5) or paragraph (4) or paragraph (6) of this Section 5.6(a) has been made, exceeds 15% of the product of the Current Market Price per share of Common Stock on the date for the determination of holders of shares of Common Stock entitled to receive such distribution times the number of shares of Common Stock outstanding on such date, then, and in each such case, immediately after the close of business on such date for determination, the Settlement Rate shall be increased so that the same shall equal the rate determined by dividing the Settlement Rate in effect immediately prior to the close of business on the date fixed for determination of the shareholders entitled to receive such distribution by a fraction of which: (i) the numerator shall be equal to the Current Market Price per share of the Common Stock on the date fixed for such determination less an amount equal to the quotient of (x) the combined amount distributed or payable in the transactions described in clauses (I) and (II) above divided by (y) the number of shares of Common Stock outstanding on such date for determination; and (ii) the denominator shall be equal to the Current Market Price per share of Common Stock on such date for determination. (6) In case a tender or exchange offer made by the Company or any subsidiary of the Company for all or any portion of Common Stock shall expire and such tender or exchange offer (as amended upon the expiration thereof) shall require the payment to shareholders (based on the acceptance (up to any maximum specified in the terms of the tender or exchange offer) of Purchased Shares) of (I) an aggregate consideration having a fair market value (as determined by the Board of Directors, whose determination shall be conclusive and described in a Board Resolution) that combined together with the aggregate of the cash plus the fair market value (as determined by the Board of Directors, whose determination shall be conclusive and described in a Board Resolution), as of the expiration of such tender or exchange offer, of consideration payable in respect of any other tender or exchange offer, by the Company or any subsidiary of the Company for all or any portion of the Common Stock expiring within the 12 months preceding the expiration of such tender or exchange offer and in respect of which no adjustment pursuant to paragraph (5) of this Section 5.6(a) or this paragraph (6) has been made, and (II) the aggregate amount of any distributions to all holders of Common Stock made exclusively in cash within the 12 months preceding the expiration of such tender or exchange offer and in respect of which no adjustment pursuant to paragraph (5) of this Section 5.6(a) or this paragraph (6) has been made, exceeds 15% of the product of the Current Market Price per share of Common Stock as of the last time (the "Expiration Time") tenders could have been made pursuant to such tender or exchange offer (as it may be amended) times the number of shares of Common Stock outstanding (including any tendered shares) on the Expiration Time, then, and in each such case, immediately prior to 46 the opening of business on the day after the date of the Expiration Time, the Settlement Rate shall be adjusted so that the same shall equal the rate determined by dividing the Settlement Rate immediately prior to the close of business on the date of the Expiration Time by a fraction of which: (i) the numerator shall be equal to (A) the product of (1) the Current Market Price per share of Common Stock on the date of the Expiration Time and (2) the number of shares of Common Stock outstanding (including any tendered shares) on the Expiration Time less (B) the amount of cash plus the fair market value (determined as aforesaid) of the aggregate consideration payable to shareholders based on the transactions described in clauses (I) and (II) above (assuming in the case of clause (I) the acceptance, up to any maximum specified in the terms of the tender or exchange offer, of Purchased Shares), and (ii) the denominator shall be equal to the product of (A) the Current Market Price per share of Common Stock as of the Expiration Time and (B) the number of shares of Common Stock outstanding (including any tendered shares) as of the Expiration Time less the number of all shares validly tendered and not withdrawn as of the Expiration Time (the shares deemed so accepted, up to any such maximum, being referred to as the "Purchased Shares"). (7) The reclassification of Common Stock into securities including securities other than Common Stock (other than any reclassification upon a Reorganization Event to which Section 5.6(b) applies) shall be deemed to involve: (a) a distribution of such securities other than Common Stock to all holders of Common Stock (and the effective date of such reclassification shall be deemed to be "the date fixed for the determination of shareholders entitled to receive such distribution" and the "date fixed for such determination" within the meaning of paragraph (4) of this Section 5.6(a)); and (b) a subdivision, split or combination, as the case may be, of the number of shares of Common Stock outstanding immediately prior to such reclassification into the number of shares of Common Stock outstanding immediately thereafter (and the effective date of such reclassification shall be deemed to be "the day upon which such subdivision or split becomes effective" or "the day upon which such combination becomes effective", as the case may be, and "the day upon which such subdivision, split or combination becomes effective" within the meaning of paragraph (3) of this Section 5.6(a)). (8) The "Current Market Price" per share of Common Stock on any day means the average of the daily Closing Prices for the five consecutive Trading Days selected by the Company commencing not more than 30 Trading Days before, and ending not later than, the earlier of the day in question and the day before the "ex date" with respect to the issuance or distribution requiring such computation. For purposes of this paragraph, the term "ex date", when used with respect to any issuance or distribution, shall mean the first date on which the 47 Common Stock trades regular way on such exchange or in such market without the right to receive such issuance or distribution. (9) All adjustments to the Settlement Rate shall be calculated to the nearest 1/10,000th of a share of Common Stock (or if there is not a nearest 1/10,000th of a share, to the next lower 1/10,000th of a share). No adjustment in the Settlement Rate shall be required unless such adjustment would require an increase or decrease of at least one percent thereof; provided, however, that any adjustments which by reason of this subparagraph are not required to be made shall be carried forward and taken into account in any subsequent adjustment. If an adjustment is made to the Settlement Rate pursuant to paragraph (1), (2), (3), (4), (5), (6), (7) or (10) of this Section 5.6(a), an adjustment shall also be made to the Applicable Market Value solely to determine which of clauses (1), (2) or (3) of the definition of Settlement Rate in Section 5.1 will apply on the Purchase Contract Settlement Date. Such adjustment shall be made by multiplying the Applicable Market Value by a fraction of which the numerator shall be the Settlement Rate immediately after such adjustment pursuant to paragraph (1), (2), (3), (4), (5), (6), (7) or (10) of this Section 5.6(a) and the denominator shall be the Settlement Rate immediately before such adjustment; provided, however, that if such adjustment to the Settlement Rate is required to be made pursuant to the occurrence of any of the events contemplated by paragraph (1), (2), (3), (4), (5), (7) or (10) of this Section 5.6(a) during the period taken into consideration for determining the Applicable Market Value, appropriate and customary adjustments shall be made to the Settlement Rate. (10) The Company may make such increases in the Settlement Rate, in addition to those required by this Section 5.6(a), as it considers to be advisable in order to avoid or diminish any income tax to any holders of shares of Common Stock resulting from any dividend or distribution of stock or issuance of rights, options or warrants to purchase or subscribe for stock or from any event treated as such for income tax purposes or for any other reason. (b) Adjustment for Consolidation, Merger or Other Reorganization Event. In the event of: (i) any consolidation or merger of the Company with or into another Person (other than a merger or consolidation in which the Company is the continuing corporation and in which the shares of Common Stock outstanding immediately prior to the merger or consolidation are not exchanged for cash, securities or other property of the Company or another corporation); (ii) any sale, transfer, lease or conveyance to another Person of the property of the Company as an entirety or substantially as an entirety; (iii) any statutory exchange of securities of the Company with another Person (other than in connection with a merger or acquisition); or 48 (iv) any liquidation, dissolution or winding up of the Company other than as a result of or after the occurrence of a Termination Event (any such event, a "Reorganization Event"), the Settlement Rate will be adjusted to provide that each Holder of Securities will receive on the Purchase Contract Settlement Date with respect to each Purchase Contract forming a part thereof, the kind and amount of securities, cash and other property receivable upon such Reorganization Event (without any interest thereon, and without any right to dividends or distribution thereon which have a record date that is prior to the Purchase Contract Settlement Date) by a Holder of the number of shares of Common Stock issuable on account of each Purchase Contract if the Purchase Contract Settlement Date had occurred immediately prior to such Reorganization Event, assuming such Holder of Common Stock is not a Person with which the Company consolidated or into which the Company merged or which merged into the Company or to which such sale or transfer was made, as the case may be (any such Person, a "Constituent Person"), or an Affiliate of a Constituent Person to the extent such Reorganization Event provides for different treatment of Common Stock held by Affiliates of the Company and non-affiliates and such Holder failed to exercise his rights of election, if any, as to the kind or amount of securities, cash and other property receivable upon such Reorganization Event (provided that if the kind or amount of securities, cash and other property receivable upon such Reorganization Event is not the same for each share of Common Stock held immediately prior to such Reorganization Event by other than a Constituent Person or an Affiliate thereof and in respect of which such rights of election shall not have been exercised ("non-electing share"), then for the purpose of this Section the kind and amount of securities, cash and other property receivable upon such Reorganization Event by each non-electing share shall be deemed to be the kind and amount so receivable per share by a plurality of the non-electing shares). In the event of such a Reorganization Event, the Person formed by such consolidation, merger or exchange or the Person which acquires the assets of the Company or, in the event of a liquidation, dissolution or winding up of the Company, the Company or a liquidating trust created in connection therewith, shall execute and deliver to the Purchase Contract Agent an agreement supplemental hereto providing that the Holders of each Outstanding Security shall have the rights provided by this Section 5.6(b). Such supplemental agreement shall provide for adjustments which, for events subsequent to the effective date of such supplemental agreement, shall be as nearly equivalent as may be practicable to the adjustments provided for in this Section. The above provisions of this Section shall similarly apply to successive Reorganization Events. (c) All calculations and determinations pursuant to this Section 5.6 shall be made by the Company or its agent and the Purchase Contract Agent shall have no responsibility with respect thereto. Section 5.7. Notice of Adjustments and Certain Other Events. (a) Whenever the Settlement Rate and the Applicable Market Value are adjusted as herein provided, the Company shall: (1) forthwith compute the adjusted Settlement Rate and Applicable Market Value in accordance with Section 5.6 and prepare and transmit to the Purchase Contract Agent an Officers' Certificate setting forth the Settlement Rate and the Applicable Market Value, the 49 method of calculation thereof in reasonable detail, and the facts requiring such adjustment and upon which such adjustment is based; and (2) within 10 Business Days following the occurrence of an event that requires an adjustment to the Settlement Rate and the Applicable Market Value pursuant to Section 5.6 (or if the Company is not aware of such occurrence, as soon as practicable after becoming so aware), provide a written notice to the Holders of the Securities of the occurrence of such event and a statement in reasonable detail setting forth the method by which the adjustment to the Settlement Rate and the Applicable Market Value was determined and setting forth the adjusted Settlement Rate and Applicable Market Value. (b) The Purchase Contract Agent shall not at any time be under any duty or responsibility to any Holder of Securities to determine whether any facts exist which may require any adjustment of the Settlement Rate or the Applicable Market Value, or with respect to the nature or extent or calculation of any such adjustment when made, or with respect to the method employed in making the same. The Purchase Contract Agent shall not be accountable with respect to the validity or value (or the kind or amount) of any shares of Common Stock, or of any securities or property, which may at the time be issued or delivered with respect to any Purchase Contract; and the Purchase Contract Agent makes no representation with respect thereto. The Purchase Contract Agent shall not be responsible for any failure of the Company to issue, transfer or deliver any shares of Common Stock pursuant to a Purchase Contract or to comply with any of the duties, responsibilities or covenants of the Company contained in this Article. Section 5.8. Termination Event; Notice. The Purchase Contracts and all obligations and rights of the Company and the Holders thereunder, including, without limitation, the rights of the Holders to receive, and the obligations of the Company to pay, Contract Adjustment Payments and the rights and obligations of Holders to purchase shares of Common Stock, shall immediately and automatically terminate, without the necessity of any notice or action by any Holder, the Purchase Contract Agent or the Company, if, on or prior to the Purchase Contract Settlement Date, a Termination Event shall have occurred. Upon and after the occurrence of a Termination Event, the Securities shall thereafter represent the right to receive the Senior Notes or Treasury Portfolio Interests forming a part of such Securities in the case of Corporate Units, or Treasury Securities in the case of Treasury Units, in accordance with the provisions of Section 5.4 of the Pledge Agreement. Upon the occurrence of a Termination Event, the Company shall promptly but in no event later than two Business Days thereafter give written notice to the Purchase Contract Agent, the Collateral Agent and the Holders, at their addresses as they appear in the Register. Section 5.9. Early Settlement; Cash Settlement. (A) Early Settlement (a) Subject to and upon compliance with the provisions of this Section 5.9, at the option of the Holder thereof, Purchase Contracts underlying Securities may be settled early ("Early Settlement") on or prior to 5:00 p.m. (New York City time) on the Election Date, as provided herein. In order to exercise the right to effect Early Settlement with respect to any Purchase Contracts, the 50 Holder of the Certificate evidencing Securities shall deliver such Certificate to the Purchase Contract Agent at the Corporate Trust Office duly endorsed for transfer to the Company or in blank with the form of Election to Settle Early on the reverse thereof duly completed and accompanied by payment (payable to the Company in immediately available funds) in an amount (the "Early Settlement Amount") equal to: (1) the product of (A) the Stated Amount times (B) the number of Purchase Contracts with respect to which the Holder has elected to effect Early Settlement, plus (2) if such delivery is made with respect to any Purchase Contracts during the period from the close of business on any Record Date next preceding any Payment Date to the opening of business on such Payment Date, an amount equal to the Contract Adjustment Payments payable on such Payment Date with respect to such Purchase Contracts. Except as provided in the immediately preceding sentence and subject to the last paragraph of Section 5.2, no payment shall be made upon Early Settlement of any Purchase Contract on account of any Contract Adjustment Payments accrued on such Purchase Contract or on account of any dividends on the Common Stock issued upon such Early Settlement. If the foregoing requirements are first satisfied with respect to Purchase Contracts underlying any Securities at or prior to 5:00 p.m. (New York City time) on a Business Day, such day shall be the "Early Settlement Date" with respect to such Securities and if such requirements are first satisfied after 5:00 p.m. (New York City time) on a Business Day or on a day that is not a Business Day, the "Early Settlement Date" with respect to such Securities shall be the next succeeding Business Day. Upon the receipt of such Certificate and Early Settlement Amount from the Holder, the Purchase Contract Agent shall pay to the Company such Early Settlement Amount, the receipt of which payment the Company shall confirm in writing. The Purchase Contract Agent shall then, in accordance with Section 5.6 of the Pledge Agreement, notify the Collateral Agent that (A) such Holder has elected to effect an Early Settlement, which notice shall set forth the number of such Purchase Contracts as to which such Holder has elected to effect Early Settlement, (B) the Purchase Contract Agent has received from such Holder, and paid to the Company as confirmed in writing by the Company, the related Early Settlement Amount and (C) all conditions to such Early Settlement have been satisfied. (b) Upon Early Settlement of Purchase Contracts by a Holder of the related Securities, the Company shall issue, and the Holder shall be entitled to receive, 0.6148 shares of Common Stock on account of each Purchase Contract as to which Early Settlement is effected (the "Early Settlement Rate"). The Early Settlement Rate shall be adjusted in the same manner and at the same time as the Settlement Rate is adjusted. Computations and notices with respect to any such adjustments shall be made and given, respectively, as provided in Section 5.7 relating to Settlement Rate adjustments. (c) No later than the third Business Day after the applicable Early Settlement Date, the Company shall cause: 51 (1) the shares of Common Stock issuable upon Early Settlement of Purchase Contracts to be issued and delivered, together with payment in lieu of any fraction of a share, as provided in Section 5.10; and (2) the related Senior Notes, in the case of Corporate Units, or the related Treasury Securities, in the case of Treasury Units, to be released from the Pledge by the Collateral Agent and transferred, in each case, to the Purchase Contract Agent for delivery to the Holder thereof or its designee. (d) Upon Early Settlement of any Purchase Contracts, and subject to receipt of shares of Common Stock from the Company and the Senior Notes or Treasury Securities, as the case may be, from the Securities Intermediary, as applicable, the Purchase Contract Agent shall, in accordance with the instructions provided by the Holder thereof on the applicable form of Election to Settle Early on the reverse of the Certificate evidencing the related Securities: (1) transfer to the Holder the Senior Notes or Treasury Securities, as the case may be, forming a part of such Securities, and (2) deliver to the Holder a certificate or certificates for the full number of shares of Common Stock issuable upon such Early Settlement, together with payment in lieu of any fraction of a share, as provided in Section 5.10. (e) In the event that Early Settlement is effected with respect to Purchase Contracts underlying less than all the Securities evidenced by a Certificate, upon such Early Settlement the Company shall execute and the Purchase Contract Agent shall execute on behalf of the Holder, authenticate and deliver to the Holder thereof, at the expense of the Company, a Certificate evidencing the Securities as to which Early Settlement was not effected. (f) Notwithstanding anything to the contrary contained herein, Holders may effect Early Settlement of Treasury Units only in integral multiples of 20 Treasury Units. In addition, if a Tax Redemption Event has occurred and the Redemption Treasury Portfolio has become part of the Corporate Units, Purchase Contracts underlying the Corporate Units may be settled early but only in an aggregate amount of 20 Corporate Units or another integral multiple such that the Treasury Securities to be released are in integral multiples of $1,000. (B) Cash Settlement (a) (i) Unless a Holder has effected an Early Settlement pursuant to Section 5.9, a Termination Event shall have occurred pursuant to Section 5.8, a Tax Event Redemption has occurred, or a Successful Remarketing shall have occurred at any time on or before the ninth Business Day preceding the Purchase Contract Settlement Date, Holders of Corporate Units may settle their Purchase Contracts in cash by delivering to the Purchase Contract Agent a notice in substantially the form of Exhibit F hereto regarding its intention to pay in cash ("Cash Settlement") the Purchase Price for the shares of Common Stock to be purchased pursuant to the related Purchase Contract; provided that such notice must be given by 11:00 a.m. (New York City time) on the sixth Business Day immediately preceding the Purchase Contract Settlement Date. 52 (ii) A Holder of a Corporate Unit who has so notified the Purchase Contract Agent of its intention to make a Cash Settlement in accordance with paragraph (a) (i) above shall pay the Purchase Price to the Securities Intermediary for deposit in the Collateral Account prior to 11:00 a.m. (New York City time) on the fifth Business Day immediately preceding the Purchase Contract Settlement Date in lawful money of the United States by certified or cashiers' check or wire transfer, in each case in immediately available funds payable to or upon the order of the Securities Intermediary and the Securities Intermediary shall instruct the Collateral Agent to release to the Purchase Contract Agent the Pledged Senior Notes, for delivery to the Holders of the related Corporate Units who have complied with this Section. Any cash received by the Collateral Agent shall be invested promptly by the Securities Intermediary in Permitted Investments and paid to the Company on the Purchase Contract Settlement Date in settlement of the Purchase Contract in accordance with the terms of this Agreement and the Pledge Agreement. Any funds received by the Securities Intermediary in respect of the investment earnings from the investment in such Permitted Investments shall be distributed to the Purchase Contract Agent when received for payment, on a pro rata basis based on the number of Corporate Units formerly held by such Holder, to the Holders of the related Corporate Units on the Purchase Contract Settlement Date. (iii) If a Holder of a Corporate Unit fails to notify the Purchase Contract Agent of its intention to make a Cash Settlement in accordance with paragraph (a)(i) above, or notifies the Purchase Contract Agent as provided in paragraph (a)(i) above of its intention to pay the Purchase Price in cash but fails to make such payment as required by paragraph (a)(ii) above, such Holder shall be deemed to have consented (A) to the disposition of the Pledged Senior Notes on the third Business Day prior to the Purchase Contract Settlement Date pursuant to the Final Remarketing as described in Section 5.4 or, (B) if a Failed Remarketing occurs, to the Collateral Agent, for the benefit of the Company, and upon written direction of the Company as provided in the Pledge Agreement, exercising all of its rights as a secured party with respect to any Pledged Senior Notes under the Pledge Agreement and, subject to applicable law and Section 5.4(j), by either (i) retaining such Senior Notes in full satisfaction of such Holder's obligations under the related Purchase Contracts or (ii) selling such Senior Notes in one or more public or private sales. (iv) By 11:00 a.m. (New York City time), on the fourth Business Day immediately preceding the Purchase Contract Settlement Date, the Purchase Contract Agent, based on notices received by the Purchase Contract Agent pursuant to paragraph (a)(i) above and notice from the Securities Intermediary regarding cash received by it prior to such time, shall notify the Remarketing Agent, the Collateral Agent, the Trustee and the Company, by use of a notice substantially in the form of Exhibit G hereto, of the aggregate principal amount of Pledged Senior Notes to be remarketed on the Final Remarketing Date in accordance with the procedures set forth in Section 5.4(c). (b) (i) Unless a Holder of a Treasury Unit has effected an Early Settlement of the related Purchase Contract in the manner described in Section 5.9 or a Termination Event shall have occurred pursuant to Section 5.8, Holders of Treasury Units may settle their Purchase Contracts in cash by delivering to the Purchase Contract Agent a notice substantially the form of Exhibit F hereto regarding its intention to pay in cash the Purchase Price for the shares of Common Stock to be purchased pursuant to the related Purchase Contract. To settle its 53 Purchase Contracts in cash pursuant to this Section, such notice must be given prior to 5:00 p.m. (New York City time), on the second Business Day immediately preceding the Purchase Contract Settlement Date. Prior to 11:00 a.m. (New York City time), on the next succeeding Business Day, the Purchase Contract Agent shall notify the Collateral Agent of the receipt of such notices from such Holders intending to make a Cash Settlement. (ii) A Holder of a Treasury Unit who has so notified the Purchase Contract Agent of its intention to make a Cash Settlement in accordance with paragraph (b)(i) above shall pay the Purchase Price to the Securities Intermediary for deposit in the Collateral Account prior to 11:00 a.m. (New York City time), on the Business Day immediately preceding the Purchase Contract Settlement Date in lawful money of the United States by certified or cashiers' check or wire transfer, in each case, in immediately available funds payable to or upon the order of the Securities Intermediary and the Securities Intermediary shall instruct the Collateral Agent to release to the Purchase Contract Agent the Pledged Treasury Securities for delivery to the Holders of the related Treasury Units who have complied with this Section. Any cash received by the Collateral Agent shall be invested promptly by the Securities Intermediary in Permitted Investments and paid to the Company on the Purchase Contract Settlement Date in settlement of the Purchase Contract in accordance with the terms of this Agreement and the Pledge Agreement. Any funds received by the Securities Intermediary in respect of the investment earnings from the investment in such Permitted Investments shall be distributed to the Purchase Contract Agent when received for payment to the Holder of the related Treasury Units on the Purchase Contract Settlement Date. (iii) If a Holder of a Treasury Unit fails to notify the Purchase Contract Agent of its intention to make a Cash Settlement in accordance with paragraph (b)(i) above, or does notify the Purchase Contract Agent as provided in paragraph (b)(i) above of its intention to pay the Purchase Price in cash but fails to make such payment as required by paragraph (b)(ii) above, then upon the maturity of the Pledged Treasury Securities held by the Securities Intermediary, the principal amount of the Treasury Securities received by the Securities Intermediary shall be invested promptly in Permitted Investments. On the Purchase Contract Settlement Date, an amount equal to the Purchase Price shall be remitted to the Company as payment thereof without receiving any instructions from the Holder of the related Treasury Units. In the event the sum of the Proceeds from the related Pledged Treasury Securities and the investment earnings earned from such investments is in excess of the aggregate Purchase Price of the Purchase Contracts being settled thereby, the Collateral Agent shall cause the Securities Intermediary to distribute such excess to the Purchase Contract Agent for the benefit of the Holder of the related Treasury Units when received. (c) (i) Upon Cash Settlement of any Purchase Contract the Collateral Agent will in accordance with the terms of the Pledge Agreement cause the Pledged Senior Notes or the Pledged Treasury Securities, as the case may be, relating to the relevant Securities to be released from the Pledge, free and clear of any security interest of the Company, and transferred to the Purchase Contract Agent for delivery to the Holder thereof or its designee as soon as practicable; and (ii) subject to the receipt thereof, the Purchase Contract Agent shall, by book-entry transfer or other appropriate procedures, in accordance with written instructions provided by 54 the Holder thereof, transfer such Senior Notes or such Treasury Securities, as the case may be (or, if no such instructions are given to the Purchase Contract Agent by the Holder, the Purchase Contract Agent shall hold such Senior Notes or such Treasury Securities, as the case may be, and any interest payment thereon, in the name of the Purchase Contract Agent or its nominee in trust for the benefit of such Holder until the expiration of the time period specified in the abandoned property laws of the relevant state) and, in connection with such Senior Notes, the Purchase Contract Agent shall have no responsibility to vote or take any other consensual action with respect thereto. Section 5.10. No Fractional Shares. No fractional shares or scrip representing fractional shares of Common Stock shall be issued or delivered upon settlement on the Purchase Contract Settlement Date or upon Early Settlement of any Purchase Contracts. If Certificates evidencing more than one Purchase Contract shall be surrendered for settlement at one time by the same Holder, the number of full shares of Common Stock which shall be delivered upon settlement shall be computed on the basis of the aggregate number of Purchase Contracts evidenced by the Certificates so surrendered. Instead of any fractional share of Common Stock which would otherwise be deliverable upon settlement of any Purchase Contracts on the Purchase Contract Settlement Date or upon Early Settlement, the Company, through the Purchase Contract Agent, shall make a cash payment in respect of such fractional interest in an amount equal to the value of such fractional shares times the Applicable Market Value. The Company shall provide the Purchase Contract Agent from time to time with sufficient funds to permit the Purchase Contract Agent to make all cash payments required by this Section 5.10 in a timely manner. Promptly after the calculation of the Applicable Market Value, the Company shall give the Purchase Contract Agent notice thereof. All calculations and determinations of the Applicable Market Value shall be made by the Company or its agent and the Purchase Contract Agent shall have no responsibility with respect thereto. Section 5.11. Charges and Taxes. The Company will pay all stock transfer and similar taxes attributable to the initial issuance and delivery of the shares of Common Stock pursuant to the Purchase Contracts; provided, however, that the Company shall not be required to pay any such tax or taxes which may be payable in respect of any exchange of or substitution for a Certificate evidencing a Security or any issuance of a share of Common Stock in a name other than that of the registered Holder of a Certificate surrendered in respect of the Securities evidenced thereby, other than in the name of the Purchase Contract Agent, as custodian for such Holder, and the Company shall not be required to issue or deliver such share certificates or Certificates unless the Person or Persons requesting the transfer or issuance thereof shall have paid to the Company the amount of such tax or shall have established to the satisfaction of the Company that such tax has been paid. ARTICLE VI Remedies Section 6.1. Unconditional Right of Holders to Receive Contract Adjustment Payments and to Purchase Shares of Common Stock 55 Each Holder of Corporate Units or Treasury Units shall have the right, which is absolute and unconditional, (1) (subject to the payment by such Holder of Contract Adjustment Payments pursuant to Section 5.9(A)(a)), to receive each Contract Adjustment Payment with respect to the Purchase Contract constituting a part of such Security on the respective Payment Date for such Security and (2) to purchase shares of Common Stock pursuant to such Purchase Contract and, in each such case, to institute suit for the enforcement of any such Contract Adjustment Payment and right to purchase shares of Common Stock, and such rights shall not be impaired without the consent of such Holder. Section 6.2. Restoration of Rights and Remedies. If any Holder has instituted any proceeding to enforce any right or remedy under this Agreement and such proceeding has been discontinued or abandoned for any reason, or has been determined adversely to such Holder, then and in every such case, subject to any determination in such proceeding, the Company and such Holder shall be restored severally and respectively to their former positions hereunder and thereafter all rights and remedies of such Holder shall continue as though no such proceeding had been instituted. Section 6.3. Rights and Remedies Cumulative. Except as otherwise provided with respect to the replacement or payment of mutilated, destroyed, lost or stolen Certificates in the last paragraph of Section 3.10, no right or remedy herein conferred upon or reserved to the Holders is intended to be exclusive of any other right or remedy, and every right and remedy shall, to the extent permitted by law, be cumulative and in addition to every other right and remedy given hereunder or now or hereafter existing at law or in equity or otherwise. The assertion or employment of any right or remedy hereunder, or otherwise, shall not prevent the concurrent assertion or employment of any other appropriate right or remedy. Section 6.4. Delay or Omission Not Waiver. No delay or omission of any Holder to exercise any right or remedy upon a default shall impair any such right or remedy or constitute a waiver of any such right. Every right and remedy given by this Article or by law to the Holders may be exercised from time to time, and as often as may be deemed expedient, by such Holders. Section 6.5. Undertaking for Costs. All parties to this Agreement agree, and each Holder of Corporate Units or Treasury Units, by its acceptance of such Corporate Units or Treasury Units, shall be deemed to have agreed, that any court may in its discretion require, in any suit for the enforcement of any right or remedy under this Agreement, or in any suit against the Purchase Contract Agent for any action taken, suffered or omitted by it as Purchase Contract Agent, the filing by any party litigant in such suit of an undertaking to pay the costs of such suit, and that such court may in its discretion assess reasonable costs, including reasonable attorneys' fees and expenses, against any party litigant in such suit, having due regard to the merits and good faith of the claims or defenses made by such party litigant; provided that the provisions of this Section shall not apply to any suit instituted by the Company, to any suit instituted by the Purchase Contract Agent, to any suit instituted by any Holder, or group of 56 Holders, holding in the aggregate more than 10% of the Outstanding Securities, or to any suit instituted by any Holder for the enforcement of interest payable on any Senior Notes or Contract Adjustment Payments on any Purchase Contract on or after the respective Payment Date therefor in respect of any Security held by such Holder, or for enforcement of the right to purchase shares of Common Stock under the Purchase Contracts constituting part of any Security held by such Holder. Section 6.6. Waiver of Stay or Extension Laws. The Company covenants (to the extent that it may lawfully do so) that it will not at any time insist upon, or plead, or in any manner whatsoever claim or take the benefit or advantage of, any stay or extension law wherever enacted, now or at any time hereafter in force, which may affect the covenants or the performance of this Agreement; and the Company expressly waives (to the extent that it may lawfully do so) all benefit or advantage of any such law and covenants that it will not hinder, delay or impede the execution of any power herein granted to the Purchase Contract Agent or the Holders, but will suffer and permit the execution of every such power as though no such law had been enacted. ARTICLE VII The Purchase Contract Agent Section 7.1. Certain Duties and Responsibilities. (a) The Purchase Contract Agent: (1) undertakes to perform, with respect to the Securities, such duties and only such duties as are specifically set forth in this Agreement and the Pledge Agreement, and no implied covenants or obligations shall be read into this Agreement or the Pledge Agreement against the Purchase Contract Agent; and (2) in the absence of bad faith or negligence on its part, may conclusively rely, as to the truth of the statements and the correctness of the opinions expressed therein, upon certificates or opinions furnished to the Purchase Contract Agent and conforming to the requirements of this Agreement or the Pledge Agreement, as applicable, but in the case of any certificates or opinions which by any provision hereof are specifically required to be furnished to the Purchase Contract Agent, the Purchase Contract Agent shall be under a duty to examine the same to determine whether or not they conform to the requirements of this Agreement or the Pledge Agreement, as applicable, but shall have no duty to confirm or investigate the accuracy of mathematical calculations or other facts stated therein. (b) No provision of this Agreement or the Pledge Agreement shall be construed to relieve the Purchase Contract Agent from liability for its own negligent action, its own negligent failure to act, or its own willful misconduct, except that: (1) this Subsection shall not be construed to limit the effect of Subsection (a) of this Section; 57 (2) the Purchase Contract Agent shall not be liable for any error of judgment made in good faith by a Responsible Officer, unless it shall be proved that the Purchase Contract Agent was negligent in ascertaining the pertinent facts; and (3) no provision of this Agreement or the Pledge Agreement shall require the Purchase Contract Agent to expend or risk its own funds or otherwise incur any financial liability in the performance of any of its duties hereunder, or in the exercise of any of its rights or powers, if it shall have reasonable grounds for believing that adequate indemnity is not provided to it. (c) Whether or not therein expressly so provided, every provision of this Agreement and the Pledge Agreement relating to the conduct or affecting the liability of or affording protection to the Purchase Contract Agent shall be subject to the provisions of this Section. (d) The Purchase Contract Agent is authorized to execute and deliver the Pledge Agreement in its capacity as Purchase Contract Agent. Section 7.2. Notice of Default. Within 30 days after the occurrence of any default by the Company hereunder of which a Responsible Officer of the Purchase Contract Agent has actual knowledge, the Purchase Contract Agent shall transmit by mail to the Company and the Holders of Securities, as their names and addresses appear in the Register, notice of such default hereunder, unless such default shall have been cured or waived. Section 7.3. Certain Rights of Purchase Contract Agent. Subject to the provisions of Section 7.1: (1) the Purchase Contract Agent may rely and shall be protected in acting or refraining from acting upon any resolution, certificate, statement, instrument, opinion, report, notice, request, direction, consent, order, bond, debenture, note, other evidence of indebtedness or other paper or document believed by it to be genuine and to have been signed or presented by the proper party or parties; (2) any request or direction of the Company mentioned herein shall be sufficiently evidenced by an Officers' Certificate, Issuer Order or Issuer Request, and any resolution of the Board of Directors of the Company may be sufficiently evidenced by a Board Resolution; (3) whenever in the administration of this Agreement or the Pledge Agreement the Purchase Contract Agent shall deem it desirable that a matter be proved or established prior to taking, suffering or omitting any action hereunder, the Purchase Contract Agent (unless other evidence be herein specifically prescribed) may, in the absence of bad faith on its part, rely upon an Officers' Certificate of the Company; (4) the Purchase Contract Agent may consult with counsel and the written advice of such counsel or any Opinion of Counsel shall be full and complete authorization and 58 protection in respect of any action taken, suffered or omitted by it hereunder in good faith and in reliance thereon; (5) the Purchase Contract Agent shall not be bound to make any investigation into the facts or matters stated in any resolution, certificate, statement, instrument, opinion, report, notice, request, direction, consent, order, bond, debenture, note, other evidence of indebtedness or other paper or document, but the Purchase Contract Agent, in its discretion, may make reasonable further inquiry or investigation into such facts or matters related to the execution, delivery and performance of the Purchase Contracts as it may see fit, and, if the Purchase Contract Agent shall determine to make such further inquiry or investigation, it shall be given a reasonable opportunity to examine the books, records and premises of the Company, personally or by agent or attorney; and (6) the Purchase Contract Agent may execute any of the powers hereunder or perform any duties hereunder either directly or by or through agents or attorneys or an Affiliate and the Purchase Contract Agent shall not be responsible for any misconduct or negligence on the part of any agent or attorney or an Affiliate appointed with due care by it hereunder. Section 7.4. Not Responsible for Recitals or Issuance of Securities. The recitals contained herein shall be taken as the statements of the Company, and the Purchase Contract Agent assumes no responsibility for their accuracy. The Purchase Contract Agent makes no representations as to the validity or sufficiency of either this Agreement or of the Securities, or of the Pledge Agreement or the Pledge. The Purchase Contract Agent shall not be accountable for the use or application by the Company of the proceeds in respect of the Purchase Contracts. Section 7.5. May Hold Securities. Any Registrar or any other agent of the Company, or the Purchase Contract Agent and its Affiliates, in their individual or any other capacity, may become the owner or pledgee of Securities and may otherwise deal with the Company, the Collateral Agent or any other Person with the same rights it would have if it were not Registrar or such other agent, or the Purchase Contract Agent. Section 7.6. Money Held in Custody. Money held by the Purchase Contract Agent in custody hereunder need not be segregated from the other funds except to the extent required by law or provided herein. The Purchase Contract Agent shall be under no obligation to invest or pay interest on any money received by it hereunder except as otherwise agreed in writing with the Company. 59 Section 7.7. Compensation and Reimbursement. The Company agrees: (1) to pay to the Purchase Contract Agent compensation for all services rendered by it hereunder and under the Pledge Agreement as the Company and the Purchase Contact Agent shall from time to time agree; (2) except as otherwise expressly provided for herein, to reimburse the Purchase Contract Agent upon its request for all reasonable expenses, disbursements and advances incurred or made by the Purchase Contract Agent in accordance with any provision of this Agreement and the Pledge Agreement (including the reasonable compensation and the expenses and disbursements of its agents and counsel), except any such expense, disbursement or advance as may be attributable to its negligence or bad faith; and (3) to indemnify the Purchase Contract Agent and any predecessor Purchase Contract Agent for, and to hold it harmless against, any loss, liability or expense incurred without negligence or bad faith on its part, arising out of or in connection with the acceptance or administration of its duties hereunder, including the costs and expenses of defending itself against any claim or liability in connection with the exercise or performance of any of its powers or duties hereunder. The obligations of the Company under this Section 7.7 shall survive the termination of this Agreement. Section 7.8. Corporate Purchase Contract Agent Required; Eligibility. There shall at all times be a Purchase Contract Agent hereunder which shall be a corporation organized and doing business under the laws of the United States of America, any state thereof or the District of Columbia, authorized under such laws to exercise corporate trust powers, having (or being a member of a bank holding company having) a combined capital and surplus of at least $50,000,000, subject to supervision or examination by Federal or state authority and having a corporate trust office in the Borough of Manhattan, The City of New York, if there be such a corporation in the Borough of Manhattan, The City of New York, eligible under this Article and willing to act on reasonable terms. If such corporation publishes reports of condition at least annually, pursuant to law or to the requirements of said supervising or examining authority, then for the purposes of this Section, the combined capital and surplus of such corporation shall be deemed to be its combined capital and surplus as set forth in its most recent report of condition so published. If at any time the Purchase Contract Agent shall cease to be eligible in accordance with the provisions of this Section, it shall resign immediately in the manner and with the effect hereinafter specified in this Article. Section 7.9. Resignation and Removal; Appointment of Successor. (a) No resignation or removal of the Purchase Contract gent and no appointment of a successor Purchase Contract Agent pursuant to this Article shall become effective until the acceptance of appointment by the successor Purchase Contract Agent in accordance with the applicable requirements of Section 7.10. 60 (b) The Purchase Contract Agent may resign at any time by giving written notice thereof to the Company 60 days prior to the effective date of such resignation. If the instrument of acceptance by a successor Purchase Contract Agent required by Section 7.10 shall not have been delivered to the Purchase Contract Agent within 30 days after the giving of such notice of resignation, the resigning Purchase Contract Agent may petition, at the expense of the Company, any court of competent jurisdiction for the appointment of a successor Purchase Contract Agent. (c) The Purchase Contract Agent may be removed at any time by Act of the Holders of a majority in number of the Outstanding Securities delivered to the Purchase Contract Agent and the Company. If the instrument of acceptance by a successor Purchase Contract Agent required by Section 7.10 shall not have been delivered to the Purchase Contract Agent within 30 days after such removal, the Purchase Contract Agent being removed may petition, at the expense of the Company, any court of competent jurisdiction for the appointment of a successor Purchase Contract Agent. (d) If at any time: (1) the Purchase Contract Agent shall cease to be eligible under Section 7.8 and shall fail to resign after written request therefor by the Company or by any such Holder; or (2) the Purchase Contract Agent shall become incapable of acting or shall be adjudged a bankrupt or insolvent or a receiver of the Purchase Contract Agent or of its property shall be appointed or any public officer shall take charge or control of the Purchase Contract Agent or of its property or affairs for the purpose of rehabilitation, conservation or liquidation, then, in any such case, (i) the Company by a Board Resolution may remove the Purchase Contract Agent, or (ii) any Holder who has been a bona fide Holder of a Security for at least six months may, on behalf of himself and all others similarly situated, petition, at the expense of the Company, any court of competent jurisdiction for the removal of the Purchase Contract Agent and the appointment of a successor Purchase Contract Agent. (e) If the Purchase Contract Agent shall resign, be removed or become incapable of acting, or if a vacancy shall occur in the office of Purchase Contract Agent for any cause, the Company, by a Board Resolution, shall promptly appoint a successor Purchase Contract Agent and shall comply with the applicable requirements of Section 7.10. If no successor Purchase Contract Agent shall have been so appointed by the Company and accepted appointment in the manner required by Section 7.10, any Holder who has been a bona fide Holder of a Security for at least six months may, on behalf of itself and all others similarly situated, petition, at the expense of the Company, any court of competent jurisdiction for the appointment of a successor Purchase Contract Agent. (f) The Company shall give, or shall cause such successor Purchase Contract Agent to give, notice of each resignation and each removal of the Purchase Contract Agent and each appointment of a successor Purchase Contract Agent by mailing written notice of such event by first-class mail, postage prepaid, to all Holders as their names and addresses appear in the applicable 61 Register. Each notice shall include the name of the successor Purchase Contract Agent and the address of its Corporate Trust Office. Section 7.10. Acceptance of Appointment by Successor. (a) In case of the appointment hereunder of a successor Purchase Contract Agent, every such successor Purchase Contract Agent so appointed shall execute, acknowledge and deliver to the Company and to the retiring Purchase Contract Agent an instrument accepting such appointment, and thereupon the resignation or removal of the retiring Purchase Contract Agent shall become effective and such successor Purchase Contract Agent, without any further act, deed or conveyance, shall become vested with all the rights, powers, agencies and duties of the retiring Purchase Contract Agent; but, on the request of the Company or the successor Purchase Contract Agent, such retiring Purchase Contract Agent shall, upon payment of its charges, execute and deliver an instrument transferring to such successor Purchase Contract Agent all the rights, powers and trusts of the retiring Purchase Contract Agent and shall duly assign, transfer and deliver to such successor Purchase Contract Agent all property and money held by such retiring Purchase Contract Agent hereunder. (b) Upon request of any such successor Purchase Contract Agent, the Company shall execute any and all instruments for more fully and certainly vesting in and confirming to such successor Purchase Contract Agent all such rights, powers and agencies referred to in paragraph (a) of this Section. (c) No successor Purchase Contract Agent shall accept its appointment unless at the time of such acceptance such successor Purchase Contract Agent shall be eligible under this Article. Section 7.11. Merger, Conversion, Consolidation or Succession to Business. Any corporation into which the Purchase Contract Agent may be merged or converted or with which it may be consolidated, or any corporation resulting from any merger, conversion or consolidation to which the Purchase Contract Agent shall be a party, or any corporation succeeding to all or substantially all the corporate trust business of the Purchase Contract Agent, shall be the successor of the Purchase Contract Agent hereunder, provided such corporation shall be otherwise eligible under this Article, without the execution or filing of any paper or any further act on the part of any of the parties hereto. In case any Certificates shall have been authenticated and executed on behalf of the Holders, but not delivered, by the Purchase Contract Agent then in office, any successor by merger, conversion or consolidation to such Purchase Contract Agent may adopt such authentication and execution and deliver the Certificates so authenticated and executed with the same effect as if such successor Purchase Contract Agent had itself authenticated and executed such Securities. Section 7.12. Preservation of Information; Communications to Holders. (a) The Purchase Contract Agent shall preserve, in as current a form as is reasonably practicable, the names and addresses of Holders received by the Purchase Contract Agent in its capacity as Registrar. 62 (b) If three or more Holders (herein referred to as "applicants") apply in writing to the Purchase Contract Agent, and furnish to the Purchase Contract Agent reasonable proof that each such applicant has owned a Security for a period of at least six months preceding the date of such application, and such application states that the applicants desire to communicate with other Holders with respect to their rights under this Agreement or under the Securities and is accompanied by a copy of the form of proxy or other communication which such applicants propose to transmit, then the Purchase Contract Agent shall mail to all the Holders copies of the form of proxy or other communication which is specified in such request, with reasonable promptness after a tender to the Purchase Contract Agent of the materials to be mailed and of payment, or provision for the payment, of the reasonable expenses of such mailing. Section 7.13. No Obligations of Purchase Contract Agent. Except to the extent otherwise expressly provided in this Agreement, the Purchase Contract Agent assumes no obligations and shall not be subject to any liability under this Agreement, the Pledge Agreement or any Purchase Contract in respect of the obligations of the Holder of any Security thereunder. The Company agrees, and each Holder of a Certificate, by his acceptance thereof, shall be deemed to have agreed, that the Purchase Contract Agent's execution of the Certificates on behalf of the Holders shall be solely as agent and attorney-in-fact for the Holders, and that the Purchase Contract Agent shall have no obligation to perform such Purchase Contracts on behalf of the Holders, except to the extent expressly provided in Article Five hereof. Anything contained in this Agreement to the contrary notwithstanding, in no event shall the Purchase Contract Agent or its officers, employees or agents be liable for indirect, special, punitive, or consequential loss or damage of any kind whatsoever, including, but not limited to, lost profits, whether or not the likelihood of such loss or damage was known to the Purchase Contract Agent and regardless of the form of action. Section 7.14. Tax Compliance. (a) The Company will comply with all applicable certification, information reporting and withholding (including "backup" withholding) requirements imposed by applicable tax laws, regulations or administrative practice with respect to (i) any payments made with respect to the Securities or (ii) the issuance, delivery, holding, transfer, redemption or exercise of rights under the Securities. Such compliance shall include, without limitation, the preparation and timely filing of required returns and the timely payment of all amounts required to be withheld to the appropriate taxing authority or its designated agent. (b) The Purchase Contract Agent shall comply in accordance with the terms hereof with any written direction received from the Company with respect to the execution or certification of any required documentation and the application of such requirements to particular payments or Holders or in other particular circumstances, and may for purposes of this Agreement rely on any such direction in accordance with the provisions of Section 7.1(a)(2) hereof. (c) The Purchase Contract Agent shall maintain all appropriate records documenting compliance with such requirements, and shall make such records available, on written request, to the Company or its authorized representative within a reasonable period of time after receipt of such request. 63 ARTICLE VIII Supplemental Agreements Section 8.1. Supplemental Agreements Without Consent of Holders. Without the consent of any Holders, the Company, when authorized by a Board Resolution, and the Purchase Contract Agent, at any time and from time to time, may enter into one or more agreements supplemental hereto, in form satisfactory to the Company and the Purchase Contract Agent, to: (1) evidence the succession of another Person to the Company, and the assumption by any such successor of the covenants of the Company herein and in the Certificates; (2) evidence and provide for the acceptance of appointment hereunder by a successor Purchase Contract Agent; (3) add to the covenants of the Company for the benefit of the Holders, or to surrender any right or power herein conferred upon the Company; (4) make provision with respect to the rights of Holders pursuant to the requirements of Section 5.6(b); or (5) except as provided for in Section 5.6, cure any ambiguity, correct or supplement any provisions herein which may be inconsistent with any other provisions herein, or make any other provisions with respect to such matters or questions arising under this Agreement, provided such action shall not adversely affect the interests of the Holders. Section 8.2. Supplemental Agreements With Consent of Holders. With the consent of the Holders of not less than a majority of the outstanding Purchase Contracts voting together as one class, by Act of said Holders delivered to the Company and the Purchase Contract Agent, the Company, when authorized by a Board Resolution, and the Purchase Contract Agent may enter into an agreement or agreements supplemental hereto for the purpose of modifying in any manner the terms of the Purchase Contracts, or the provisions of this Agreement or the rights of the Holders in respect of the Securities; provided, however, that, except as contemplated herein, no such supplemental agreement shall, without the unanimous consent of the Holders of each outstanding Purchase Contract affected thereby, (1) change any Payment Date; (2) change the amount or the type of Collateral required to be Pledged to secure a Holder's obligations under the Purchase Contract, impair the right of the Holder of any Purchase Contract to receive interest on the related Collateral or otherwise adversely affect the Holder's rights in or to such Collateral; (3) reduce Contract Adjustment Payments or change any place where, or the coin or currency in which, Contract Adjustment Payments are payable; 64 (4) impair the right to institute suit for the enforcement of any Purchase Contract; (5) reduce the number of shares of Common Stock to be purchased pursuant to any Purchase Contract, increase the price to purchase shares of Common Stock upon settlement of any Purchase Contract, change the Purchase Contract Settlement Date or otherwise adversely affect the Holder's rights under any Purchase Contract; or (6) reduce the percentage of the outstanding Purchase Contracts the consent of whose Holders is required for any such supplemental agreement; provided that if any amendment or proposal referred to above would adversely affect only the Corporate Units or the Treasury Units, then only the affected class of Holder as of the record date, if any, for the Holders entitled to vote thereon or consent thereto will be entitled to vote or consent on such amendment or proposal, and such amendment or proposal shall not be effective except with the vote or consent of Holders of not less than a majority of such class; and provided, further, that the unanimous consent of the Holders of each outstanding Purchase Contract of the related Corporate Units or Treasury Units, as the case may be, shall be required to approve any amendment or proposal specified in clauses (1) through (6) above. It shall not be necessary for any Act of Holders under this Section to approve the particular form of any proposed supplemental agreement, but it shall be sufficient if such Act shall approve the substance thereof. Section 8.3. Execution of Supplemental Agreements. In executing, or accepting the additional agencies created by, any supplemental agreement permitted by this Article or the modifications thereby of the agencies created by this Agreement, the Purchase Contract Agent shall be entitled to receive, and (subject to Section 7.1) shall be fully protected in relying upon, an Opinion of Counsel stating that the execution of such supplemental agreement is authorized or permitted by this Agreement. The Purchase Contract Agent may, but shall not be obligated to, enter into any such supplemental agreement which affects the Purchase Contract Agent's own rights, duties or immunities under this Agreement or otherwise. Section 8.4. Effect of Supplemental Agreements. Upon the execution of any supplemental agreement under this Article, this Agreement shall be modified in accordance therewith, and such supplemental agreement shall form a part of this Agreement for all purposes; and every Holder of Certificates theretofore or thereafter authenticated, executed on behalf of the Holders and delivered hereunder, shall be bound thereby. Section 8.5. Reference to Supplemental Agreements. Certificates authenticated, executed on behalf of the Holders and delivered after the execution of any supplemental agreement pursuant to this Article may, and shall if required by the Purchase Contract Agent, bear a notation in form approved by the Purchase Contract Agent as to any matter provided for in such supplemental agreement. If the Company shall so determine, new Certificates so modified as to conform, in the opinion of the Purchase Contract Agent and the Company, to any such supplemental agreement may be prepared and executed by the Company and 65 authenticated, executed on behalf of the Holders and delivered by the Purchase Contract Agent in exchange for Outstanding Certificates. ARTICLE IX Merger, Consolidation, Share Exchange, Sale or Conveyance Section 9.1. Covenant Not to Merge, Consolidate, Enter into a Share Exchange, Sell or Convey Property Except Under Certain Conditions. The Company covenants that it will not merge, consolidate or enter into a share exchange with any other Person or sell, assign, transfer, lease or convey all or substantially all of its properties and assets to any Person or group of affiliated Persons in one transaction or a series of related transactions, unless: (1) either the Company shall be the continuing corporation, or the successor (if other than the Company) shall be a corporation organized and existing under the laws of the United States of America or a state thereof or the District of Columbia and such corporation shall expressly assume all the obligations of the Company under the Purchase Contracts, this Agreement and the Pledge Agreement by one or more supplemental agreements in form reasonably satisfactory to the Purchase Contract Agent and the Collateral Agent, executed and delivered to the Purchase Contract Agent and the Collateral Agent by such corporation; and (2) the Company or such successor corporation, as the case may be, shall not, immediately after such merger, consolidation or share exchange, or such sale, assignment, transfer, lease or conveyance, be in default in the performance of any covenant or condition hereunder, under any of the Securities or under the Pledge Agreement. Section 9.2. Rights and Duties of Successor Corporation. In case of any such merger, consolidation, share exchange, sale, assignment, transfer, lease or conveyance and upon any such assumption by a successor corporation in accordance with Section 9.1, such successor corporation shall succeed to and be substituted for the Company with the same effect as if it had been named herein as the Company. Such successor corporation thereupon may cause to be signed, and may issue either in its own name or in the name of Dominion Resources, Inc., any or all of the Certificates evidencing Securities issuable hereunder which theretofore shall not have been signed by the Company and delivered to the Purchase Contract Agent; and, upon the order of such successor corporation, instead of the Company, and subject to all the terms, conditions and limitations in this Agreement prescribed, the Purchase Contract Agent shall authenticate and execute on behalf of the Holders and deliver any Certificates which previously shall have been signed and delivered by the officers of the Company to the Purchase Contract Agent for authentication and execution, and any Certificate evidencing Securities which such successor corporation thereafter shall cause to be signed and delivered to the Purchase Contract Agent for that purpose. All the Certificates issued shall in all respects have the same legal rank and benefit under this Agreement as the Certificates theretofore or thereafter issued in accordance with the terms of this Agreement as though all of such Certificates had been issued at the date of the execution hereof. 66 In case of any such merger, consolidation, share exchange, sale, assignment, transfer, lease or conveyance such change in phraseology and form (but not in substance) may be made in the Certificates evidencing Securities thereafter to be issued as may be appropriate. Section 9.3. Officers' Certificate and Opinion of Counsel Given to Purchase Contract Agent. The Purchase Contract Agent, subject to Sections 7.1 and 7.3, shall receive an Officers' Certificate and an Opinion of Counsel as conclusive evidence that any such merger, consolidation, share exchange, sale, assignment, transfer, lease or conveyance, and any such assumption, complies with the provisions of this Article and that all conditions precedent to the consummation of any such merger, consolidation, share exchange, sale, assignment, transfer, lease or conveyance have been met. ARTICLE X Covenants Section 10.1. Performance Under Purchase Contracts. The Company covenants and agrees for the benefit of the Holders from time to time of the Securities that it will duly and punctually perform its obligations under the Purchase Contracts in accordance with the terms of the Purchase Contracts and this Agreement. Section 10.2. Maintenance of Office or Agency. The Company will maintain in the Borough of Manhattan, The City of New York an office or agency where Certificates may be: (1) presented or surrendered for acquisition of shares of Common Stock upon settlement of the Purchase Contracts on the Purchase Contract Settlement Date or Early Settlement and for transfer of Collateral upon occurrence of a Termination Event; (2) surrendered for registration of transfer or exchange, for a Collateral Substitution or re-establishment of a Corporate Unit; and and where notices and demands to or upon the Company in respect of the Securities and this Agreement may be served. The Company will give prompt written notice to the Purchase Contract Agent of the location, and any change in the location, of such office or agency. If at any time the Company shall fail to maintain any such required office or agency or shall fail to furnish the Purchase Contract Agent with the address thereof, such presentations, surrenders, notices and demands may be made or served at the Corporate Trust Office, and the Company hereby appoints the Purchase Contract Agent as its agent to receive all such presentations, surrenders, notices and demands. The Company may also from time to time designate one or more other offices or agencies where Certificates may be presented or surrendered for any or all such purposes and may from time to time rescind such designations; provided, however, that no such designation or rescission shall in any manner relieve the Company of its obligation to maintain an office or agency in the Borough of Manhattan, The City of New York for such purposes. The Company will give 67 prompt written notice to the Purchase Contract Agent of any such designation or rescission and of any change in the location of any such other office or agency. The Company hereby designates as the place of payment for the Securities the Corporate Trust Office and appoints the Purchase Contract Agent at its Corporate Trust Office as paying agent in such city. Section 10.3. Company to Reserve Common Stock. The Company shall at all times prior to the Purchase Contract Settlement Date reserve and keep available, free from preemptive rights, out of its authorized but unissued Common Stock the full number of shares of Common Stock issuable against tender of payment in respect of all Purchase Contracts constituting a part of the Securities evidenced by Outstanding Certificates. Section 10.4. Covenants as to Common Stock. The Company covenants that all shares of Common Stock which may be issued against tender of payment in respect of any Purchase Contract constituting a part of the Outstanding Securities will, upon issuance, be duly authorized, validly issued, fully paid and nonassessable. Section 10.5. Statements of Officers of the Company as to Default. The Company will deliver to the Purchase Contract Agent, within 120 days after the end of each fiscal year of the Company (which as of the date hereof is December 31) ending after the date hereof, an Officers' Certificate (one of the signers of which shall be the principal executive officer, principal financial officer or principal accounting officer of the Company), stating whether or not to the best knowledge of the signers thereof the Company is in default in the performance and observance of any of the terms, provisions and conditions hereof, and if the Company shall be in default, specifying all such defaults and the nature and status thereof of which they may have knowledge. Section 10.6. ERISA. Each Holder from time to time of the Corporate Units which is a Plan hereby represents that its acquisition of the Corporate Units and the holding of the same satisfies the applicable fiduciary requirements of ERISA and that it is entitled to exemption relief from the prohibited transaction provisions of ERISA and the Code in accordance with one or more prohibited transaction exemptions or otherwise will not result in a nonexempt prohibited transaction. 68 IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly executed as of the day and year first above written. DOMINION RESOURCES, INC. By: ___________________________________ Name: Title: JPMORGAN CHASE BANK, as Purchase Contract Agent By: ___________________________________ Name: Title: EXHIBIT A FORM OF FACE OF CORPORATE UNIT CERTIFICATE This certificate is a global certificate within the meaning of the Purchase Contract Agreement hereinafter referred to and is registered in the name of The Depository Trust Company, a New York corporation (the "Depositary"), or a nominee of the Depositary. This certificate is exchangeable for certificates registered in the name of a person other than the Depositary or its nominee only in the limited circumstances described in the Purchase Contract Agreement and no transfer of this certificate (other than a transfer of this certificate as a whole by the Depositary to a nominee of the Depositary or by a nominee of the Depositary to the Depositary or another nominee of the Depositary) may be registered except in limited circumstances. Unless this certificate is presented by an authorized representative of the Depositary for registration of transfer, exchange or payment, and any certificate issued is registered in the name of Cede & Co. or such other name as is requested by an authorized representative of the Depositary (and any payment hereon is made to Cede & Co. or to such other entity as is requested by an authorized representative of the Depositary), any transfer, pledge or other use hereof for value or otherwise by or to any person is wrongful since the registered owner hereof, Cede & Co., has an interest herein./1/ No. _______ CUSIP No. 25746U 40 6 Number of Corporate Units ____________ DOMINION RESOURCES, INC. Corporate Units This Corporate Unit Certificate certifies that [Cede & Co.]/2/, or registered assigns, is the registered Holder of the number of Corporate Units set forth above [or such other number as set forth in the Schedule of Increases and Decreases in Global Certificate attached hereto] /3/. Each Corporate Unit consists of (i) the rights and obligations of the Holder under one Purchase Contract with Dominion Resources, Inc., a Virginia corporation (the "Company"), and (ii) either (a) the beneficial ownership by the Holder of one 2002 Series A 5.75% Senior Note, due May 15, 2008 (the "Senior Note") of the Company, having a principal amount of $50, subject to the Pledge of such Senior Note by such Holder pursuant to the Pledge Agreement or (b) following a Successful Remarketing or a Tax Redemption Event of the Senior Notes, the beneficial ownership by the Holder of a Treasury Portfolio Interest, subject to the Pledge of such Treasury Portfolio Interest pursuant to the Pledge Agreement. All capitalized terms used herein which are defined in the Purchase Contract Agreement (as defined on the reverse hereof) have the meaning set forth therein. ________________ /1/ Insert in Global Certificates only. /2/ Insert in Global Certificates only. /3/ Insert in Global Certificates only. Pursuant to the Pledge Agreement, the Senior Note or Treasury Portfolio Interest, as the case may be, constituting part of each Corporate Unit evidenced hereby has been pledged to the Collateral Agent, for the benefit of the Company, to secure the obligations of the Holder under the Purchase Contract comprising a portion of such Corporate Units. Each Purchase Contract evidenced hereby obligates the Holder of this Corporate Unit Certificate to purchase, and the Company to sell, on the Purchase Contract Settlement Date, at a price equal to $50 in cash (the "Stated Amount"), a number of shares of Common Stock, equal to the Settlement Rate, unless on or prior to the Purchase Contract Settlement Date there shall have occurred a Termination Event or an Early Settlement with respect to the Corporate Units of which such Purchase Contract is a part, all as provided in the Purchase Contract Agreement and more fully described on the reverse hereof. The purchase price (the "Purchase Price") for the shares of Common Stock purchased pursuant to each Purchase Contract evidenced hereby, if not paid earlier, shall be paid on the Purchase Contract Settlement Date by cash or by application of payment received in respect of the principal amount with respect to each Pledged Senior Note pursuant to the Remarketing or payment received in respect of each Pledged Treasury Portfolio Interest, as the case may be, pledged to secure the obligations under such Purchase Contract of the Holder of the Corporate Units of which such Purchase Contract is a part. The Company shall pay on February 15, May 15, August 15 and November 15 of each year (each, a "Payment Date"), commencing May 15, 2002, in respect of each Purchase Contract forming part of a Corporate Unit evidenced hereby, an amount (the "Contract Adjustment Payments") equal to (a) if a Reset Transaction has not occurred, 3.00% per annum of the Stated Amount or (b) following the occurrence of a Reset Transaction, the Adjusted Contract Adjustment Payment Rate related to such Reset Transaction until any such succeeding Reset Transaction shall occur, in either case, computed on the basis of (i) for any full quarterly period, a 360-day year of twelve 30-day months, (ii) for any period shorter than a full quarterly period, a 30-day month and (iii) for periods less than a month, the actual number of days elapsed per 30-day period. Such Contract Adjustment Payments shall be payable to the Person in whose name this Corporate Unit Certificate (or a Predecessor Corporate Unit Certificate) is registered at the close of business on the Record Date for such Payment Date. Unless a Successful Remarketing or a Tax Event Redemption shall have occurred, interest on the Senior Notes, the beneficial ownership of which is evidenced hereby, is payable quarterly in arrears on each Payment Date. Such interest payments shall be payable to the Person in whose name this Corporate Unit Certificate (or a Predecessor Corporate Unit Certificate) is registered at the close of business on the Record Date for such Payment Date. Following a Successful Remarketing or a Tax Event Redemption, the portion of the Treasury Portfolio Return equal to the interest payable on such Senior Notes will be paid on the Purchase Contract Settlement Date. Such portion of the Treasury Portfolio Return shall be payable to the Person in whose name this Corporate Unit Certificate (or a Predecessor Corporate Unit Certificate) is registered at the close of business on the Record Date for such Payment Date which is the Purchase Contract Settlement Date. Contract Adjustment Payments and (i) interest payments on the Senior Notes or (ii) distributions on the Treasury Portfolio, as the case may be, will be payable at the office of the A-2 Purchase Contract Agent in The City of New York or, at the option of the Company, by check mailed to the address of the Person entitled thereto as such address appears on the Corporate Unit Register. Reference is hereby made to the further provisions set forth on the reverse hereof, which further provisions shall for all purposes have the same effect as if set forth at this place. Unless the certificate of authentication hereon has been executed by the Purchase Contract Agent by manual signature, this Corporate Unit Certificate shall not be entitled to any benefit under the Purchase Contract Agreement or the Pledge Agreement or be valid or obligatory for any purpose. IN WITNESS WHEREOF, the Company has caused this instrument to be duly executed. DOMINION RESOURCES, INC. By: ______________________________ Name: Title: By: _______________________________ Name: Title: HOLDER SPECIFIED ABOVE (as to obligations of such Holder under the Purchase Contracts evidenced hereby) By: JPMorgan Chase Bank not individually but solely as Attorney-in-Fact of such Holder By: _______________________________ Name: Title: Dated: A-3 CERTIFICATE OF AUTHENTICATION OF PURCHASE CONTRACT AGENT This is one of the Corporate Unit Certificates referred to in the within mentioned Purchase Contract Agreement. By: JPMORGAN CHASE BANK, as Purchase Contract Agent By: ______________________________ Authorized Officer A-4 (FORM OF REVERSE OF CORPORATE UNIT CERTIFICATE) Each Purchase Contract evidenced hereby is governed by a Purchase Contract Agreement, dated as of March 20, 2002 (as may be supplemented from time to time, the "Purchase Contract Agreement"), between the Company and JPMorgan Chase Bank, as Purchase Contract Agent (including its successors hereunder, the "Purchase Contract Agent"), to which Purchase Contract Agreement and supplemental agreements thereto reference is hereby made for a description of the respective rights, limitations of rights, obligations, duties and immunities thereunder of the Purchase Contract Agent, the Company, and the Holders and of the terms upon which the Corporate Unit Certificates are, and are to be, executed and delivered. Each Purchase Contract evidenced hereby obligates the Holder of this Corporate Unit Certificate to purchase, and the Company to sell, on the Purchase Contract Settlement Date at a price equal to the Stated Amount (the "Purchase Price"), a number of shares of Common Stock of the Company equal to the Settlement Rate, unless, on or prior to the Purchase Contract Settlement Date, there shall have occurred a Termination Event with respect to the Security of which such Purchase Contract is a part or an Early Settlement shall have occurred. The "Settlement Rate" is equal to: (1) if the Applicable Market Value (as defined below) is equal to or greater than $81.33 (the "Threshold Appreciation Price"), 0.6148 shares of Common Stock per Purchase Contract; (2) if the Applicable Market Value is less than the Threshold Appreciation Price but greater than $59.80 (the "Reference Price"), the number of shares of Common Stock per Purchase Contract having a value, based on the Applicable Market Value, equal to the Stated Amount; and (3) if the Applicable Market Amount is less than or equal to the Reference Price, 0.8361 shares of Common Stock per Purchase Contract, in each case subject to adjustment as provided in the Purchase Contract Agreement. No fractional shares of Common Stock will be issued upon settlement of Purchase Contracts, as provided in the Purchase Contract Agreement. Each Purchase Contract evidenced hereby, which is settled either through Early Settlement or Cash Settlement, shall obligate the Holder of the related Corporate Unit to purchase at the Purchase Price, and the Company to sell, a number of newly issued shares of Common Stock equal to the Early Settlement Rate or the Settlement Rate, as applicable. The "Applicable Market Value" means the average of the Closing Price per share of Common Stock on each of the 20 Trading Days ending on the third Trading Day immediately preceding the Purchase Contract Settlement Date. A-5 The "Closing Price" per share of Common Stock on any date of determination means (1) the closing sale price (or, if no closing price is reported, the last reported sale price) per share of Common Stock on the New York Stock Exchange (the "NYSE") on such date; (2) if the Common Stock is not listed for trading on the NYSE on any such date, the closing sale price per share as reported in the composite transactions for the principal United States securities exchange on which the Common Stock is so listed; (3) if the Common Stock is not so listed on a United States national or regional securities exchange, the closing sale price per share as reported by The Nasdaq Stock Market; (4) if the Common Stock is not so reported, the last quoted bid price per share for the Common Stock in the over-the-counter market as reported by the National Quotation Bureau or similar organization; or (5) if such bid price is not available, the average of the mid-point of the last bid and ask prices per share of the Common Stock on such date from at least three nationally recognized independent investment banking firms retained for this purpose by the Company. A "Trading Day" means a day on which the Common Stock (1) is not suspended from trading on any national or regional securities exchange or association or over-the-counter market at the close of business and (2) has traded at least once on the national or regional securities exchange or association or over-the-counter market that is the primary market for the trading of the Common Stock. In accordance with the terms of the Purchase Contract Agreement, the Holder of this Corporate Unit Certificate shall pay the Purchase Price for the shares of Common Stock purchased pursuant to each Purchase Contract evidenced hereby by (i) effecting a Cash Settlement or an Early Settlement or a Remarketing of the related Pledged Senior Notes or (ii) application of payments received in respect of the Pledged Treasury Portfolio Interest acquired form the proceeds of a Remarketing or Tax Event Redemption of the related Pledged Senior Notes relating to the Corporate Units represented by this Corporate Unit Certificate. As provided in the Purchase Contract Agreement, upon the occurrence of a Failed Remarketing, the Collateral Agent shall exercise, for the benefit of the Company, its rights as a secured creditor with respect to the Pledged Senior Notes related to this Corporate Unit Certificate and, subject to applicable law, may, among other things, (i) retain such Pledged Senior Notes in full satisfaction of the Holders' obligations under the Purchase Contracts or (ii) sell such Pledged Senior Notes in one or more public or private sales, the proceeds, if any, of such sale to constitute full satisfaction of the Holders' obligations under the Purchase Contracts. With respect to such Pledged Senior Notes which are the subject of a Failed Remarketing, any accrued and unpaid interest payments on such Pledged Senior Notes will become payable by the Company to the Holder of this Corporate Unit Certificate in the manner provided for in the Purchase Contract Agreement. The Company shall not be obligated to issue any shares of Common Stock in respect of a Purchase Contract or deliver any certificates therefor to the Holder unless it shall have received A-6 payment of the aggregate purchase price for the shares of Common Stock to be purchased thereunder in the manner herein set forth which payment, in the case of a Failed Remarketing shall occur by the resale of Pledged Senior Notes or foreclosure on and retention of such Pledged Senior Notes pursuant to the Purchase Contract Agreement and the Pledge Agreement. Each Purchase Contract evidenced hereby and all obligations and rights of the Company and the Holder thereunder shall terminate if a Termination Event shall occur. Upon the occurrence of a Termination Event, the Company shall give written notice to the Purchase Contract Agent and to the Holders, at their addresses as they appear in the Corporate Unit Register. Upon and after the occurrence of a Termination Event, the Collateral Agent shall release the Pledged Senior Note or Pledged Treasury Portfolio Interest, as the case may be, forming a part of each Corporate Unit from the Pledge. A Corporate Unit shall thereafter represent the right to receive the Senior Note or Treasury Portfolio Interest, as the case may be, forming a part of such Corporate Unit in accordance with the terms of the Purchase Contract Agreement and the Pledge Agreement. Under the terms of the Pledge Agreement, the Purchase Contract Agent will be entitled to exercise the voting and any other consensual rights pertaining to the Pledged Senior Notes. Upon receipt of notice of any meeting at which holders of Senior Notes are entitled to vote or upon the solicitation of consents, waivers or proxies of holders of Senior Notes, the Purchase Contract Agent shall, as soon as practicable thereafter, mail to the Corporate Unit Holders a notice: (1) containing such information as is contained in the notice or solicitation; (2) stating that each Corporate Unit Holder on the record date set by the Purchase Contract Agent therefor (which, to the extent possible, shall be the same date as the record date for determining the holders of Senior Notes entitled to vote) shall be entitled to instruct the Purchase Contract Agent as to the exercise of the voting rights pertaining to the Senior Notes constituting a part of such Holder's Corporate Units; and (3) stating the manner in which such instructions may be given. Upon the written request of the Corporate Unit Holders on such record date, the Purchase Contract Agent shall endeavor insofar as practicable to vote or cause to be voted, in accordance with the instructions set forth in such requests, the maximum aggregate principal amount of Senior Notes as to which any particular voting instructions are received. In the absence of specific instructions from the Holder of a Corporate Unit, the Purchase Contract Agent shall abstain from voting the Senior Notes evidenced by such Corporate Units. The Corporate Unit Certificates are issuable only in registered form and only in denominations of a single Corporate Unit and any integral multiple thereof. The transfer of any Corporate Unit Certificate will be registered and Corporate Unit Certificates may be exchanged as provided in the Purchase Contract Agreement. The Corporate Unit Registrar may require a Holder, among other things, to furnish appropriate endorsements and transfer documents permitted by the Purchase Contract Agreement. No service charge shall be required for any such registration of transfer or exchange, but the Company and the Purchase Contract Agent may require payment of a sum sufficient to cover any tax or other governmental charge payable in connection therewith. A Holder who elects to substitute a Treasury Security for Senior Notes, thereby creating Treasury Units, A-7 shall be responsible for any fees or expenses payable in connection therewith. Except as provided in the Purchase Contract Agreement, for so long as the Purchase Contract underlying a Corporate Unit remains in effect, such Corporate Unit shall not be separable into its constituent parts, and the rights and obligations of the Holder of such Corporate Unit in respect of the Senior Note or Treasury Portfolio Interest and Purchase Contract constituting such Corporate Unit may be transferred and exchanged only as a Corporate Unit. A holder of a Corporate Unit may substitute for the Pledged Senior Notes securing its obligation under the related Purchase Contract Treasury Securities in an aggregate principal amount at maturity equal to the aggregate principal amount of the Pledged Senior Notes in accordance with the terms of the Purchase Contract Agreement and the Pledge Agreement. From and after such Collateral Substitution, the Security for which such Pledged Treasury Securities secures the Holder's obligation under the Purchase Contract shall be referred to as a "Treasury Unit." A Holder may make such Collateral Substitution only in integral multiples of 20 Corporate Units for 20 Treasury Units. Such Collateral Substitution may cause the equivalent aggregate principal amount of this Certificate to be increased or decreased; provided, however, this Corporate Unit Certificate shall not represent more than such maximum amount of Corporate Units as shall at the time be prescribed by the applicable Clearing Agency. All such adjustments to the equivalent aggregate principal amount of this Corporate Unit Certificate shall be duly recorded by placing an appropriate notation on the Schedule attached hereto. A Holder of Treasury Units may recreate Corporate Units by delivering to the Securities Intermediary Senior Notes with an aggregate principal amount equal to the aggregate principal amount at maturity of the Pledged Treasury Securities in exchange for the release of such Pledged Treasury Securities in accordance with the terms of the Purchase Contract Agreement and the Pledge Agreement. The Company shall pay, on each Payment Date, the Contract Adjustment Payments payable in respect of each Purchase Contract to the Person in whose name the Corporate Unit Certificate evidencing such Purchase Contract is registered at the close of business on the Record Date for such Payment Date. Contract Adjustment Payments will be payable at the office of the Purchase Contract Agent in The City of New York or, at the option of the Company, by check mailed to the address of the Person entitled thereto at such address as it appears on the Corporate Unit Register. The Purchase Contracts and all obligations and rights of the Company and the Holders thereunder, including, without limitation, the rights of the Holders to receive, and the obligations of the Company to pay, Contract Adjustment Payments, shall immediately and automatically terminate, without the necessity of any notice or action by any Holder, the Purchase Contract Agent or the Company, if, on or prior to the Purchase Contract Settlement Date, a Termination Event shall have occurred. Upon the occurrence of a Termination Event, the Company shall promptly but in no event later than two Business Days thereafter give written notice to the Purchase Contract Agent, the Collateral Agent and the Holders, at their addresses as they appear in the Corporate Unit Register. Upon and after the occurrence of a Termination Event, the Collateral Agent shall release the Senior Notes or Treasury Portfolio Interest from the Pledge in accordance with the provisions of the Pledge Agreement. A Corporate Unit shall thereafter represent the right to receive the Senior Note or A-8 Treasury Portfolio Interest forming a part of such Corporate Unit in accordance with the terms of the Purchase Contract Agreement and the Pledge Agreement. Subject to and upon compliance with the provisions of the Purchase Contract Agreement, at the option of the Holder thereof, Purchase Contracts underlying Securities may be settled early ("Early Settlement") as provided in the Purchase Contract Agreement. In order to exercise the right to effect Early Settlement with respect to any Purchase Contracts evidenced by this Corporate Unit Certificate, the Holder of this Corporate Unit Certificate shall deliver this Corporate Unit Certificate to the Purchase Contract Agent at the Corporate Trust Office duly endorsed for transfer to the Company or in blank with the form of Election to Settle Early set forth below duly completed and accompanied by payment in the form of immediately available funds payable to the order of the Company in an amount (the "Early Settlement Amount") equal to: (1) the product of (A) the Stated Amount times (B) the number of Purchase Contracts with respect to which the Holder has elected to effect Early Settlement, plus (2) if such delivery is made with respect to any Purchase Contracts during the period from the close of business on any Record Date for any Payment Date to the opening of business on such Payment Date, an amount equal to the Contract Adjustment Payments payable on such Payment Date with respect to such Purchase Contracts. Upon Early Settlement of Purchase Contracts by a Holder of the related Securities, the Pledged Senior Notes underlying such Securities shall be released from the Pledge as provided in the Pledge Agreement and the Holder shall be entitled to receive a number of shares of Common Stock on account of each Purchase Contract forming part of a Corporate Unit as to which Early Settlement is effected equal to the Early Settlement Rate. The Early Settlement Rate shall initially be equal to 0.6148 shares of Common Stock and shall be adjusted in the same manner and at the same time as the Settlement Rate is adjusted as provided in the Purchase Contract Agreement. Upon registration of transfer of this Corporate Unit Certificate, the transferee shall be bound (without the necessity of any other action on the part of such transferee, except as may be required by the Purchase Contract Agent pursuant to the Purchase Contract Agreement), under the terms of the Purchase Contract Agreement and the Purchase Contracts evidenced hereby and the transferor shall be released from the obligations under the Purchase Contracts evidenced by this Corporate Unit Certificate. The Company covenants and agrees, and the Holder, by its acceptance hereof, likewise covenants and agrees, to be bound by the provisions of this paragraph. The Holder of this Corporate Unit Certificate, by its acceptance hereof, authorizes the Purchase Contract Agent to enter into and perform the related Purchase Contracts forming part of the Corporate Units evidenced hereby on its behalf as its attorney-in-fact, expressly withholds any consent to the assumption (i.e., affirmance) of the Purchase Contracts by the Company or its trustee in the event that the Company becomes the subject of a case under the Bankruptcy Code, agrees to be bound by the terms and provisions thereof, covenants and agrees to perform its obligations under such Purchase Contracts, consents to the provisions of the Purchase Contract Agreement, authorizes the Purchase Contract Agent to enter into and perform the Purchase Contract Agreement and the Pledge Agreement on its behalf as its attorney-in-fact, and consents to the Pledge of the Senior Notes underlying this Corporate Unit Certificate pursuant to the Pledge Agreement. The Holder further A-9 covenants and agrees that, to the extent and in the manner provided in the Purchase Contract Agreement and the Pledge Agreement, but subject to the terms thereof, payments in respect of the aggregate principal amount of the Pledged Senior Notes or Pledged Treasury Portfolio Interest, as the case may be, shall be paid on the Purchase Contract Settlement Date by the Collateral Agent to the Company in satisfaction of such Holder's obligations under such Purchase Contract and such Holder shall acquire no right, title or interest in such payments. Subject to certain exceptions, the provisions of the Purchase Contract Agreement may be amended with the consent of the Holders of a majority of the Purchase Contracts. The Purchase Contracts shall for all purposes be governed by, and construed in accordance with, the laws of the State of New York. The Company, the Purchase Contract Agent and its Affiliates and any agent of the Company or the Purchase Contract Agent may treat the Person in whose name this Corporate Unit Certificate is registered as the owner of the Corporate Units evidenced hereby for the purpose of receiving payments of interest payable quarterly on the Senior Notes, receiving payments of Contract Adjustment Payments, performance of the Purchase Contracts and for all other purposes whatsoever, whether or not any payments in respect thereof be overdue and notwithstanding any notice to the contrary, and neither the Company, the Purchase Contract Agent nor any such agent shall be affected by notice to the contrary. The Purchase Contracts shall not, prior to the settlement thereof, entitle the Holder to any of the rights of a holder of shares of Common Stock. Upon settlement of the Purchase Contracts, the Holder will be entitled to all of the rights of a holder of shares of Common Stock, including, without limitation, the right to vote and receive dividends and other payments and to consent and receive notice as a shareholder in respect of the meetings of shareholders and for the election of directors of the Company and for all other matters, and all other rights whatsoever as a shareholder of the Company. A copy of the Purchase Contract Agreement is available for inspection at the offices of the Purchase Contract Agent. A-10 ABBREVIATIONS The following abbreviations, when used in the inscription on the face of this instrument, shall be construed as though they were written out in full according to applicable laws or regulations: TEN COM - as tenants in common UNIF GIFT MIN ACT - ---------------Custodian--------------- (cust) (minor) Under Uniform Gifts to Minors Act of _______ ___________________________________________ TEN ENT - as tenants by the entireties JT TEN - as joint tenants with right of survivorship and not as tenants in common Additional abbreviations may also be used though not in the above list. _________________________ FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and transfer(s) unto ________________________________________________________________________________ ________________________________________________________________________________ ________________________________________________________________________________ (Please insert Social Security or Taxpayer I.D. or other Identifying Number of Assignee) ________________________________________________________________________________ (Please Print or Type Name and Address Including Postal Zip Code of Assignee) the within Corporate Unit Certificates and all rights thereunder, hereby irrevocably constituting and appointing ________________________________________ _______________________________________ attorney to transfer said Corporate Unit Certificates on the books of Dominion Resources, Inc. with full power of substitution in the premises. Dated: ___________________ ______________________________________________ Signature NOTICE: The signature to this assignment must correspond with the name as it appears upon the face of the within Corporate Unit Certificates in every particular, without alteration or enlargement or any change whatsoever. A-11 Signature Guarantee: ___________________________________ A-12 SETTLEMENT INSTRUCTIONS The undersigned Holder directs that a certificate for shares of Common Stock deliverable upon settlement on or after the Purchase Contract Settlement Date of the Purchase Contracts underlying the number of Corporate Units evidenced by this Corporate Unit Certificate be registered in the name of, and delivered, together with a check in payment for any fractional share, to the undersigned at the address indicated below unless a different name and address have been indicated below. If shares are to be registered in the name of a Person other than the undersigned, the undersigned will pay any transfer tax payable incident thereto. Dated: _______________________ ______________________________________ Signature Signature Guarantee: _________________ (if assigned to another person) If shares are to be registered in the REGISTERED HOLDER name of and delivered to a Person other than the Holder, please (i) print such Person's name and address and (ii) provide a guarantee of your signature: Please print name and address of Registered Holder: _____________________________________ ______________________________________ Name Name _____________________________________ ______________________________________ Address Address _____________________________________ ______________________________________ _____________________________________ ______________________________________ _____________________________________ ______________________________________ Social Security or other Taxpayer Identification _____________________________________ Number, if any A-13 ELECTION TO SETTLE EARLY The undersigned Holder of this Corporate Unit Certificate hereby irrevocably exercises the option to effect Early Settlement in accordance with the terms of the Purchase Contract Agreement with respect to the Purchase Contracts underlying the number of Corporate Units evidenced by this Corporate Unit Certificate specified below. The undersigned Holder directs that a certificate for shares of Common Stock deliverable upon such Early Settlement be registered in the name of, and delivered, together with a check in payment for any fractional share and any Corporate Unit Certificate representing any Corporate Units evidenced hereby as to which Early Settlement of the related Purchase Contracts is not effected, to the undersigned at the address indicated below unless a different name and address have been indicated below. Pledged Senior Notes or Treasury Securities deliverable upon such Early Settlement will be transferred in accordance with the transfer instructions set forth below. If shares are to be registered in the name of a Person other than the undersigned, the undersigned will pay any transfer tax payable incident thereto. Dated: ___________________________ ___________________________________ Signature Signature Guarantee: _____________________________________ A-14 Number of Securities evidenced hereby as to which Early Settlement of the related Purchase Contracts is being elected: If shares of Common Stock or Corporate REGISTERED HOLDER Unit Certificates are to be registered in the name of and delivered to, and Pledged Senior Notes are to be transferred to, a Person other than the Holder, please print such Person's name and address: Please print name and address of Registered Holder: _____________________________________ ______________________________________ Name Name _____________________________________ ______________________________________ Address Address _____________________________________ ______________________________________ _____________________________________ ______________________________________ _____________________________________ ______________________________________ Social Security or other Taxpayer Identification _____________________________________ Number, if any A-15 Transfer Instructions for Pledged Senior Notes or Treasury Securities Transferable Upon Early Settlement or a Termination Event: ________________________________________________________________________________ ________________________________________________________________________________ ________________________________________________________________________________ A-16 [TO BE ATTACHED TO GLOBAL CERTIFICATES] SCHEDULE OF INCREASES OR DECREASES IN GLOBAL CERTIFICATE The following increases or decreases in this Global Certificate have been made:
- -------------------------------------------------------------------------------------------------------------------------------- Number of Corporate Amount of decrease in Amount of increase in Units evidenced by this Signature of authorized Number of Corporate Number of Corporate Global Certificate officer of Purchase Units evidenced by the Units evidenced by the following such Contract Agent or Date Global Certificate Global Certificate decrease or increase Securities Custodian - -------------------------------------------------------------------------------------------------------------------------------- ________________________________________________________________________________________________________________________________ ________________________________________________________________________________________________________________________________ ________________________________________________________________________________________________________________________________ ________________________________________________________________________________________________________________________________ ________________________________________________________________________________________________________________________________ ________________________________________________________________________________________________________________________________ ________________________________________________________________________________________________________________________________ ________________________________________________________________________________________________________________________________ ________________________________________________________________________________________________________________________________ ________________________________________________________________________________________________________________________________ ________________________________________________________________________________________________________________________________ ________________________________________________________________________________________________________________________________ ________________________________________________________________________________________________________________________________ ________________________________________________________________________________________________________________________________ ________________________________________________________________________________________________________________________________ ________________________________________________________________________________________________________________________________ ________________________________________________________________________________________________________________________________ ________________________________________________________________________________________________________________________________ ________________________________________________________________________________________________________________________________ ________________________________________________________________________________________________________________________________ ________________________________________________________________________________________________________________________________ ________________________________________________________________________________________________________________________________ ________________________________________________________________________________________________________________________________ ________________________________________________________________________________________________________________________________
A-17 EXHIBIT B FORM OF FACE OF TREASURY UNIT CERTIFICATE This certificate is a global certificate within the meaning of the Purchase Contract Agreement hereinafter referred to and is registered in the name of The Depository Trust Company, a New York corporation (the "Depositary"), or a nominee of the Depositary. This certificate is exchangeable for certificates registered in the name of a person other than the Depositary or its nominee only in the limited circumstances described in the Purchase Contract Agreement and no transfer of this certificate (other than a transfer of this certificate as a whole by the Depositary to a nominee of the Depositary or by a nominee of the Depositary to the depositary or another nominee of the Depositary) may be registered except in limited circumstances. Unless this certificate is presented by an authorized representative of the Depositary for registration of transfer, exchange or payment, and any certificate issued is registered in the name of Cede & Co. or such other name as is requested by an authorized representative of the Depositary (and any payment hereon is made to Cede & Co. or to such other entity as is requested by an authorized representative of the Depositary), any transfer, pledge or other use hereof for value or otherwise by or to any person is wrongful since the registered owner hereof, Cede & Co., has an interest herein./1/ No. _______ CUSIP No. 25746U 50 5 Number of Treasury Units ________ DOMINION RESOURCES, INC. Treasury Units This Treasury Unit Certificate certifies that [Cede & Co.]/2/, or registered assigns, is the registered Holder of the number of Treasury Units set forth above [or such other number as set forth in the Schedule of Increases and Decreases in Global Certificate attached hereto]/3/. Each Treasury Unit consists of (i) the rights and obligations of the Holder under one Purchase Contract with Dominion Resources, Inc., a Virginia corporation (the "Company") and (ii) a 1/20 undivided beneficial ownership interest of a Treasury Security having a principal amount at maturity equal to $1,000 and maturing on or prior to May 15, 2006. All capitalized terms used herein which are defined in the Purchase Contract Agreement (as defined on the reverse hereof) have the meaning set forth therein. Pursuant to the Pledge Agreement, the Treasury Securities constituting part of each Treasury Unit evidenced hereby have been pledged to the Collateral Agent, for the benefit of the Company, to secure the obligations of the Holder under the Purchase Contract comprising a portion of such Treasury Unit. ______________ /1/ Insert in Global Certificates only. /2/ Insert in Global Certificates only. /3/ Insert in Global Certificates only. Each Purchase Contract evidenced hereby obligates the Holder of this Treasury Unit Certificate to purchase, and the Company, to sell, on the Purchase Contract Settlement Date, at a price equal to $50 in cash (the "Stated Amount"), a number of shares of Common Stock equal to the Settlement Rate, unless on or prior to the Purchase Contract Settlement Date there shall have occurred a Termination Event or an Early Settlement with respect to the Treasury Unit of which such Purchase Contract is a part, all as provided in the Purchase Contract Agreement and more fully described on the reverse hereof. The purchase price (the "Purchase Price") for the shares of Common Stock purchased pursuant to each Purchase Contract evidenced hereby, if not paid earlier, shall be paid on the Purchase Contract Settlement Date by application of the Proceeds from the Treasury Securities at maturity pledged to secure the obligations under such Purchase Contract of the Holder of the Treasury Unit of which such Purchase Contract is a part. The Company shall pay on February 15, May 15, August 15 and November 15 of each year (each, a "Payment Date"), commencing May 15, 2002, in respect of each Purchase Contract evidenced hereby, an amount (the "Contract Adjustment Payments") equal to (a) if a Reset Transaction has not occurred, 3.00% per annum of the Stated Amount or (b) following the occurrence of a Reset Transaction, the Adjusted Contract Adjustment Payment Rate related to such Reset Transaction until any such succeeding Reset Transaction shall occur, in either case, computed on the basis of (i) for any full quarterly period, a 360-day year of twelve 30-day months, (ii) for any period shorter than a full quarterly period, a 30-day month and (iii) for periods less than a month, the actual number of days elapsed per 30-day period). Such Contract Adjustment Payments shall be payable to the Person in whose name this Treasury Unit Certificate (or a Predecessor Treasury Unit Certificate) is registered at the close of business on the Record Date for such Payment Date. Contract Adjustment Payments will be payable at the office of the Purchase Contract Agent in The City of New York or, at the option of the Company, by check mailed to the address of the Person entitled thereto as such address appears on the Treasury Unit Register. Reference is hereby made to the further provisions set forth on the reverse hereof, which further provisions shall for all purposes have the same effect as if set forth at this place. Unless the certificate of authentication hereon has been executed by the Purchase Contract Agent by manual signature, this Treasury Unit Certificate shall not be entitled to any benefit under the Purchase Contract Agreement or the Pledge Agreement or be valid or obligatory for any purpose. B-2 IN WITNESS WHEREOF, the Company has caused this instrument to be duly executed. DOMINION RESOURCES, INC. By: ___________________________________ Name: Title: By: ___________________________________ Name: Title: HOLDER SPECIFIED ABOVE (as to obligations of such Holder under the Purchase Contracts evidenced hereby) By: JPMorgan Chase Bank, not individually but solely as Attorney-in-Fact of such Holder By: ___________________________________ Name: Title: Dated: B-3 CERTIFICATE OF AUTHENTICATION OF PURCHASE CONTRACT AGENT This is one of the Treasury Unit Certificates referred to in the within mentioned Purchase Contract Agreement. By: JPMORGAN CHASE BANK, as Purchase Contract Agent By: _______________________________ Authorized Officer B-4 (FORM OF REVERSE OF TREASURY UNIT CERTIFICATE) Each Purchase Contract evidenced hereby is governed by a Purchase Contract Agreement, dated as of March 20, 2002 (as may be supplemented from time to time, the "Purchase Contract Agreement") between the Company and JPMorgan Chase Bank as Purchase Contract Agent (including its successors thereunder, herein called the "Purchase Contract Agent"), to which the Purchase Contract Agreement and supplemental agreements thereto reference is hereby made for a description of the respective rights, limitations of rights, obligations, duties and immunities thereunder of the Purchase Contract Agent, the Company and the Holders and of the terms upon which the Treasury Unit Certificates are, and are to be, executed and delivered. Each Purchase Contract evidenced hereby obligates the Holder of this Treasury Unit Certificate to purchase, and the Company to sell, on the Purchase Contract Settlement Date at a price equal to the Stated Amount (the "Purchase Price") a number of shares of Common Stock of the Company equal to the Settlement Rate, unless on or prior to the Purchase Contract Settlement Date: there shall have occurred a Termination Event with respect to the Security of which such Purchase Contract is a part or an Early Settlement shall have occurred. The "Settlement Rate" is equal to: (1) if the Applicable Market Value (as defined below) is equal to or greater than $81.33 (the "Threshold Appreciation Price"), 0.6148 shares of Common Stock per Purchase Contract; (2) if the Applicable Market Value is less than the Threshold Appreciation Price but greater than $59.80 (the "Reference Price"), the number of shares of Common Stock per Purchase Contract having a value, based on the Applicable Market Value, equal to the Stated Amount; and (3) if the Applicable Market Amount is less than or equal to the Reference Price, then 0.8361 shares of Common Stock per Purchase Contract; in each case subject to adjustment as provided in the Purchase Contract Agreement. No fractional shares of Common Stock will be issued upon settlement of Purchase Contracts, as provided in the Purchase Contract Agreement. Each Purchase Contract evidenced hereby, which is settled either through Early Settlement or Cash Settlement, shall obligate the Holder of the related Treasury Unit to purchase at the Purchase Price for cash, and the Company to sell, a number of newly issued shares of Common Stock equal to the Early Settlement Rate or the Settlement Rate, as applicable. The "Applicable Market Value" means the average of the Closing Prices per share of Common Stock on each of the 20 Trading Days ending on the third Trading Day immediately preceding the Purchase Contract Settlement Date. B-5 The "Closing Price" per share of Common Stock on any date of determination means: (1) the closing sale price (or, if no closing price is reported, the last reported sale price) per share of Common Stock on the New York Stock Exchange (the "NYSE") on such date; (2) if the Common Stock is not listed for trading on the NYSE on any such date, the closing sale price per share as reported in the composite transactions for the principal United States securities exchange on which the Common Stock is so listed; (3) if the Common Stock is not so listed on a United States national or regional securities exchange, the closing sale price per share as reported by The Nasdaq Stock Market; (4) if the Common Stock is not so reported, the last quoted bid price per share for the Common Stock in the over-the-counter market as reported by the National Quotation Bureau or similar organization; or (5) if such bid price is not available, the average of the mid-point of the last bid and ask prices per share of the Common Stock on such date from at least three nationally recognized independent investment banking firms retained for this purpose by the Company. A "Trading Day" means a day on which the Common Stock (A) is not suspended from trading on any national or regional securities exchange or association or over-the-counter market at the close of business and (B) has traded at least once on the national or regional securities exchange or association or over-the-counter market that is the primary market for the trading of the Common Stock. In accordance with the terms of the Purchase Contract Agreement, the Holder of this Treasury Unit shall pay the Purchase Price for the shares of Common Stock purchased pursuant to each Purchase Contract evidenced hereby either by effecting a Cash Settlement or an Early Settlement of each such Purchase Contract or by applying the principal amount at maturity of the Pledged Treasury Securities underlying such Holder's Treasury Units. A Holder of Treasury Units who does not effect, prior to 11:00 a.m. (New York City time) on the Business Day immediately preceding the Purchase Contract Settlement Date, an effective Cash Settlement or an Early Settlement, shall pay the Purchase Price for the shares of Common Stock to be issued under the related Purchase Contract from the proceeds of the Pledged Treasury Securities. The Company shall not be obligated to issue any shares of Common Stock in respect of a Purchase Contract or deliver any certificates therefor to the Holder unless it shall have received payment of the aggregate purchase price for the shares of Common Stock to be purchased thereunder in the manner herein set forth. Each Purchase Contract evidenced hereby and all obligations and rights of the Company and the Holder thereunder shall terminate if a Termination Event shall occur. Upon the occurrence of a Termination Event, the Company shall give written notice to the Purchase Contract Agent and to the Holders, at their addresses as they appear in the Treasury Unit Register. Upon and after the occurrence of a Termination Event, the Collateral Agent shall release the Pledged Treasury B-6 Securities (as defined in the Pledge Agreement) forming a part of each Treasury Unit. A Treasury Unit shall thereafter represent the right to receive the interest in the Treasury Security forming a part of such Treasury Unit, in accordance with the terms of the Purchase Contract Agreement and the Pledge Agreement. The Treasury Unit Certificates are issuable only in registered form and only in denominations of a single Treasury Unit and any integral multiple thereof. The transfer of any Treasury Unit Certificate will be registered and Treasury Unit Certificates may be exchanged as provided in the Purchase Contract Agreement. The Treasury Unit Registrar may require a Holder, among other things, to furnish appropriate endorsements and transfer documents permitted by the Purchase Contract Agreement. No service charge shall be required for any such registration of transfer or exchange, but the Company and the Purchase Contract Agent may require payment of a sum sufficient to cover any tax or other governmental charge payable in connection therewith. A Holder who elects to substitute Senior Notes for Treasury Securities, thereby recreating Corporate Units, shall be responsible for any fees or expenses associated therewith. Except as provided in the Purchase Contract Agreement, for so long as the Purchase Contract underlying a Treasury Unit remains in effect, such Treasury Unit shall not be separable into its constituent parts, and the rights and obligations of the Holder of such Treasury Unit in respect of the Treasury Security and the Purchase Contract constituting such Treasury Unit may be transferred and exchanged only as a Treasury Unit. A Holder of Treasury Units may recreate Corporate Units by delivering to the Collateral Agent Senior Notes with a principal amount equal to the aggregate principal amount at maturity of the Pledged Treasury Securities in exchange for the release of such Pledged Treasury Securities in accordance with the terms of the Purchase Contract Agreement and the Pledge Agreement. From and after such Collateral Substitution, the Holder's Security shall be referred to as a "Corporate Unit." Such Collateral Substitution may cause the equivalent aggregate principal amount of this Certificate to be increased or decreased; provided, however, this Treasury Unit Certificate shall not represent more than such maximum amount of Treasury Units as shall at the time be prescribed by the applicable Clearing Agency. All such adjustments to the equivalent aggregate principal amount of this Treasury Unit Certificate shall be duly recorded by placing an appropriate notation on the Schedule attached hereto. A Holder of Corporate Units may recreate Treasury Units by delivering to the Collateral Agent Treasury Securities in an aggregate principal amount at maturity equal to the aggregate principal amount of the Pledged Senior Notes in exchange for the release of such Pledged Senior Notes in accordance with the terms of the Purchase Contract Agreement and the Pledge Agreement. Any such recreation of a Treasury Units may be effected only in multiples of 20 Corporate Units for 20 Treasury Units. The Company shall pay, on each Payment Date, the Contract Adjustment Payments payable in respect of each Purchase Contract to the Person in whose name the Treasury Unit Certificate evidencing such Purchase Contract is registered at the close of business on the Record Date for such Payment Date. Contract Adjustment Payments will be payable at the office of the Purchase Contract Agent in The City of New York or, at the option of the Company, by check mailed B-7 to the address of the Person entitled thereto at such address as it appears on the Treasury Unit Register. The Purchase Contracts and all obligations and rights of the Company and the Holders thereunder, including, without limitation, the rights of the Holders to receive and the obligation of the Company to pay Contract Adjustment Payments, shall immediately and automatically terminate, without the necessity of any notice or action by any Holder, the Purchase Contract Agent or the Company, if, on or prior to the Purchase Contract Settlement Date, a Termination Event shall have occurred. Upon the occurrence of a Termination Event, the Company shall promptly but in no event later than two Business Days thereafter give written notice to the Purchase Contract Agent, the Collateral Agent and the Holders, at their addresses as they appear in the Treasury Unit Register. Upon the occurrence of a Termination Event, the Collateral Agent shall release the Treasury Securities from the Pledge in accordance with the provisions of the Pledge Agreement. A Treasury Unit shall thereafter represent the right to receive the interest in the Treasury Security forming a part of such Treasury Unit, in accordance with the terms of the Purchase Contract Agreement and the Pledge Agreement. Subject to and upon compliance with the provisions of the Purchase Contract Agreement, at the option of the Holder thereof, Purchase Contracts underlying Securities may be settled early ("Early Settlement") as provided in the Purchase Contract Agreement. In order to exercise the right to effect Early Settlement with respect to any Purchase Contracts evidenced by this Treasury Unit the Holder of this Treasury Unit Certificate shall deliver this Treasury Unit Certificate to the Purchase Contract Agent at the Corporate Trust Office duly endorsed for transfer to the Company or in blank with the form of Election to Settle Early set forth below duly completed and accompanied by payment in the form of immediately available funds payable to the order of the Company in an amount (the "Early Settlement Amount") equal to: (1) the product of (A) the Stated Amount times (B) the number of Purchase Contracts with respect to which the Holder has elected to effect Early Settlement, plus (2) if such delivery is made with respect to any Purchase Contracts during the period from the close of business on any Record Date for any Payment Date to the opening of business on such Payment Date, an amount equal to the Contract Adjustment Payments payable on such Payment Date with respect to such Purchase Contracts. Upon Early Settlement of Purchase Contracts by a Holder of the related Securities, the Pledged Treasury Securities underlying such Securities shall be released from the Pledge as provided in the Pledge Agreement and the Holder shall be entitled to receive a number of shares of Common Stock on account of each Purchase Contract forming part of a Treasury Unit as to which Early Settlement is effected equal to 0.6148 shares of Common Stock per Purchase Contract (the "Early Settlement Rate"). The Early Settlement Rate shall be adjusted in the same manner and at the same time as the Settlement Rate is adjusted as provided in the Purchase Contract Agreement. Upon registration of transfer of this Treasury Unit Certificate, the transferee shall be bound (without the necessity of any other action on the part of such transferee, except as may be required by the Purchase Contract Agent pursuant to the Purchase Contract Agreement), under the terms of the Purchase Contract Agreement and the Purchase Contracts evidenced hereby and the B-8 transferor shall be released from the obligations under the Purchase Contracts evidenced by this Treasury Unit Certificate. The Company covenants and agrees, and the Holder, by its acceptance hereof, likewise covenants and agrees, to be bound by the provisions of this paragraph. The Holder of this Treasury Unit Certificate, by its acceptance hereof, authorizes the Purchase Contract Agent to enter into and perform the related Purchase Contracts forming part of the Treasury Units evidenced hereby on its behalf as its attorney-in-fact, expressly withholds any consent to the assumption (i.e., affirmance) of the Purchase Contracts by the Company or its trustee in the event that the Company becomes the subject of a case under the Bankruptcy Code, agrees to be bound by the terms and provisions thereof, covenants and agrees to perform its obligations under such Purchase Contracts, consents to the provisions of the Purchase Contract Agreement, authorizes the Purchase Contract Agent to enter into and perform the Purchase Contract Agreement and the Pledge Agreement on its behalf as its attorney-in-fact, and consents to the Pledge of the Treasury Securities underlying this Treasury Unit Certificate pursuant to the Pledge Agreement. The Holder further covenants and agrees, that, to the extent and in the manner provided in the Purchase Contract Agreement and the Pledge Agreement, but subject to the terms thereof, payments in respect of the aggregate principal amount of the Pledged Treasury Securities at maturity shall be paid on the Purchase Contract Settlement Date by the Collateral Agent to the Company in satisfaction of such Holder's obligations under such Purchase Contract and such Holder shall acquire no right, title or interest in such payments. Subject to certain exceptions, the provisions of the Purchase Contract Agreement may be amended with the consent of the Holders of a majority of the Purchase Contracts. The Purchase Contracts shall for all purposes be governed by, and construed in accordance with, the laws of the State of New York. The Company, the Purchase Contract Agent and its Affiliates and any agent of the Company or the Purchase Contract Agent may treat the Person in whose name this Treasury Unit Certificate is registered as the owner of the Treasury Units evidenced hereby for the purpose of receiving payments of Contract Adjustment Payments, performance of the Purchase Contracts and for all other purposes whatsoever, whether or not any payments in respect thereof be overdue and notwithstanding any notice to the contrary, and neither the Company, the Purchase Contract Agent nor any such agent shall be affected by notice to the contrary. The Purchase Contracts shall not, prior to the settlement thereof, entitle the Holder to any of the rights of a holder of shares of Common Stock. Upon settlement of the Purchase Contracts, the Holder will be entitled to all of the rights of a holder of shares of Common Stock, including, without limitation, the right to vote and receive dividends and other payments and to consent and receive notice as a shareholder in respect of the meetings of shareholders and for the election of directors of the Company and for all other matters, and all other rights whatsoever as a shareholder of the Company. A copy of the Purchase Contract Agreement is available for inspection at the offices of the Purchase Contract Agent. B-9 ABBREVIATIONS The following abbreviations, when used in the inscription on the face of this instrument, shall be construed as though they were written out in full according to applicable laws or regulations: TEN COM - as tenants in common UNIF GIFT MIN ACT - ---------------Custodian--------------- (cust) (minor) Under Uniform Gifts to Minors Act of _______ _____________________________________ TEN ENT - as tenants by the entireties JT TEN - as joint tenants with right of survivorship and not as tenants in common Additional abbreviations may also be used though not in the above list. _____________________ FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and transfer(s) unto ______________________________________________________________ (Please insert Social Security or Taxpayer I.D. or other Identifying Number of Assignee) ________________________________________________________________________________ ________________________________________________________________________________ ________________________________________________________________________________ (Please Print or Type Name and Address Including Postal Zip Code of Assignee) the within Treasury Unit Certificates and all rights thereunder, hereby irrevocably constituting and appointing _______________________________________ attorney to transfer said Treasury Unit Certificates on the books of Dominion Resources, Inc. with full power of substitution in the premises. Dated: ___________________ ______________________________________________ Signature NOTICE: The signature to this assignment must correspond with the name as it appears upon the face of the within Treasury Unit Certificates in every particular, without alteration or enlargement or any change whatsoever. B-10 Signature Guarantee: ___________________________________ B-11 SETTLEMENT INSTRUCTIONS The undersigned Holder directs that a certificate for shares of Common Stock deliverable upon settlement on or after the Purchase Contract Settlement Date of the Purchase Contracts underlying the number of Treasury Units evidenced by this Treasury Unit Certificate be registered in the name of, and delivered, together with a check in payment for any fractional share, to the undersigned at the address indicated below unless a different name and address have been indicated below. If shares are to be registered in the name of a Person other than the undersigned, the undersigned will pay any transfer tax payable incident thereto. Dated: _______________________ _________________________________ Signature Signature Guarantee:_____________ (if assigned to another person) If shares are to be registered in the name of REGISTERED HOLDER and delivered to a Person other than the Holder, please (i) print such Person's name and address and (ii) provide a guarantee of your signature: Please print name and address of Registered Holder: _____________________________________ _________________________________ Name Name _____________________________________ _________________________________ Address Address _____________________________________ _________________________________ _____________________________________ _________________________________ _____________________________________ _________________________________ Social Security or other Taxpayer Identification _________________________________ Number, if any B-12 ELECTION TO SETTLE EARLY The undersigned Holder of this Treasury Unit Certificate irrevocably exercises the option to effect Early Settlement in accordance with the terms of the Purchase Contract Agreement with respect to the Purchase Contracts underlying the number of Treasury Units evidenced by this Treasury Unit Certificate specified below. The option to effect Early Settlement may be exercised only with respect to Purchase Contracts underlying Treasury Units with an aggregate Stated Amount equal to $1,000 or an integral multiple thereof. The undersigned Holder directs that a certificate for shares of Common Stock deliverable upon such Early Settlement be registered in the name of, and delivered, together with a check in payment for any fractional share and any Treasury Unit Certificate representing any Treasury Unit evidenced hereby as to which Early Settlement of the related Purchase Contracts is not effected, to the undersigned at the address indicated below unless a different name and address have been indicated below. Pledged Treasury Securities deliverable upon such Early Settlement will be transferred in accordance with the transfer instructions set forth below. If shares are to be registered in the name of a Person other than the undersigned, the undersigned will pay any transfer tax payable incident thereto. Dated: ___________________________ ________________________________ Signature Signature Guarantee: ______________________________ B-13 Number of Securities evidenced hereby as to which Early Settlement of the related Purchase Contracts is being elected: If shares of Common Stock or Treasury Unit REGISTERED HOLDER Certificates REGISTERED HOLDER are to be registered in the name of and delivered to, and Pledged Treasury Securities are to be transferred to, a Person other than the Holder, please print such Person's name and address: Please print name and address of Registered Holder: _____________________________________ ____________________________________ Name Name _____________________________________ ____________________________________ Address Address _____________________________________ ____________________________________ _____________________________________ ____________________________________ _____________________________________ ____________________________________ Social Security or other Taxpayer Identification ___________________________________ Number, if any Transfer Instructions for Pledged Treasury Securities Transferable Upon Early Settlement or a Termination Event: ________________________________________________________________________________ ________________________________________________________________________________ ________________________________________________________________________________ B-14 [TO BE ATTACHED TO GLOBAL CERTIFICATES] SCHEDULE OF INCREASES OR DECREASES IN GLOBAL CERTIFICATE The following increases or decreases in this Global Certificate have been made:
- --------------------------------------------------------------------------------------------------------------------------------- Number of Treasury Amount of decrease in Amount of increase in Units evidenced by this Signature of authorized Number of Treasury Number of Treasury Global Certificate officer of Purchase Units evidenced by the Units evidenced by the Following such Contract Agent or Date Global Certificate Global Certificate decrease or increase Securities Custodian - --------------------------------------------------------------------------------------------------------------------------------- - --------------------------------------------------------------------------------------------------------------------------------- - --------------------------------------------------------------------------------------------------------------------------------- - --------------------------------------------------------------------------------------------------------------------------------- - --------------------------------------------------------------------------------------------------------------------------------- - --------------------------------------------------------------------------------------------------------------------------------- - --------------------------------------------------------------------------------------------------------------------------------- - --------------------------------------------------------------------------------------------------------------------------------- - --------------------------------------------------------------------------------------------------------------------------------- - --------------------------------------------------------------------------------------------------------------------------------- - --------------------------------------------------------------------------------------------------------------------------------- - --------------------------------------------------------------------------------------------------------------------------------- - --------------------------------------------------------------------------------------------------------------------------------- - --------------------------------------------------------------------------------------------------------------------------------- - --------------------------------------------------------------------------------------------------------------------------------- - --------------------------------------------------------------------------------------------------------------------------------- - --------------------------------------------------------------------------------------------------------------------------------- - --------------------------------------------------------------------------------------------------------------------------------- - --------------------------------------------------------------------------------------------------------------------------------- - --------------------------------------------------------------------------------------------------------------------------------- - --------------------------------------------------------------------------------------------------------------------------------- - --------------------------------------------------------------------------------------------------------------------------------- - --------------------------------------------------------------------------------------------------------------------------------- - --------------------------------------------------------------------------------------------------------------------------------- - --------------------------------------------------------------------------------------------------------------------------------- - ---------------------------------------------------------------------------------------------------------------------------------
B-15 EXHIBIT C NOTICE FROM HOLDER TO PURCHASE CONTRACT AGENT (Election for Creation of Treasury Units or Recreation of Corporate Units) JPMorgan Chase Bank, as Purchase Contract Agent 450 West 33rd Street, 15/th/ Floor New York, New York 10001 Attention: Institutional Trust Services Re: [Corporate Units] [Treasury Units] of Dominion Resources, Inc. Upper DECS Equity Income Securities --------------------------------------------------- Reference is made to the Purchase Contract Agreement, dated as of March 20, 2002 (the "Purchase Contract Agreement"), between Dominion Resources, Inc. (the "Company") and you, as Purchase Contract Agent and as Attorney-in-Fact for the Holders of the Purchase Contracts. All capitalized terms that are used but not defined herein have the meanings assigned to them in the Purchase Contract Agreement. The undersigned Holder hereby notifies you in accordance with Section [3.13] [3.14] of the Purchase Contract Agreement, that such Holder has elected to [create][recreate] ________ [Treasury Units] [Corporate Units] by substitution of $__________ aggregate principal amount of [Treasury Securities] [Senior Notes] for the [Pledged Senior Notes] [Pledged Treasury Securities] held in the Collateral Account, in accordance with the Pledge Agreement. The undersigned Holder hereby acknowledges that such Holder may [create Treasury Units] [recreate Corporate Units] only in integral multiples of 20 [Corporate Units] [Treasury Units]. ____________________________________ Name of Holder ____________________________________ Signature Signature Guarantee:________________ Date: _______________________ Please print name and address of Registered Holder: __________________________________________________________________ Name __________________________________________________________________ Social Security or other Taxpayer Identification Number, if any ___________________________________________________________ ___________________________________________________________ Address C-2 EXHIBIT D INSTRUCTION TO PURCHASE CONTRACT AGENT JPMORGAN CHASE BANK, as Purchase Contract Agent 450 West 33/rd/ Street, 15/th/ Floor New York, New York 10001 Attention: Institutional Trust Services Re: _______ [Corporate Units] [Treasury Units] of Dominion Resources, Inc. (the "Company") Upper DECS Equity Income Securities The undersigned Holder hereby notifies you that it has Transferred to Bank One Trust Company, N.A., as Securities Intermediary, for credit to the Collateral Account, $______ aggregate principal amount of [Senior Notes] [Treasury Securities] in exchange for the [Pledged Senior Notes] [Pledged Treasury Securities] held in the Collateral Account, in accordance with the Pledge Agreement, dated as of March 20, 2002 (the "Pledge Agreement"; unless otherwise defined herein, terms defined in the Pledge Agreement are used herein as defined therein), between you, the Company, the Collateral Agent and the Securities Intermediary. The undersigned Holder has paid all applicable fees relating to such exchange. The undersigned Holder hereby instructs you to instruct the Collateral Agent to release to you on behalf of the undersigned Holder the [Pledged Senior Notes] [Pledged Treasury Securities] related to the above-captioned [Corporate Units] [Treasury Units]. Date: _______________________ ______________________________________ Signature Signature Guarantee:__________________ Please print name and address of Registered Holder: ____________________________________ ______________________________________ Name Social Security or other Taxpayer Identification Number, if any Address ____________________________________ ____________________________________ ____________________________________ EXHIBIT E NOTICE FROM PURCHASE CONTRACT AGENT TO HOLDERS (Transfer of Collateral upon Occurrence of a Termination Event) [HOLDER] _______________________ _______________________ Attention: Telecopy: __________ Re: _______ [Corporate Units] [Treasury Units] of Dominion Resources, Inc. (the "Company") Upper DECS Equity Income Securities Please refer to the Purchase Contract Agreement, dated as of March 20, 2002 (the "Purchase Contract Agreement"; unless otherwise defined herein, terms defined in the Purchase Contract Agreement are used herein as defined therein), among the Company and the undersigned, as Purchase Contract Agent and as attorney-in-fact for the holders of Corporate Units and Treasury Units from time to time. We hereby notify you that a Termination Event has occurred and that [the Senior Notes][the Treasury Securities][the Treasury Portfolio Interest] underlying your ownership interest in _____ [Corporate Units][Treasury Units] have been released and are being held by us for your account pending receipt of transfer instructions with respect to such [Senior Notes][Treasury Securities][Treasury Portfolio Interest] (the "Released Securities"). Pursuant to Section 3.15 of the Purchase Contract Agreement, we hereby request written transfer instructions with respect to the Released Securities. Upon receipt of your instructions and upon transfer to us of your [Corporate Units][Treasury Units] effected through book-entry transfer or by delivery to us of your [Corporate Unit Certificate][Treasury Unit Certificate], we shall transfer the Released Securities by book-entry transfer, or other appropriate procedures, in accordance with your instructions. In the event you fail to effect such transfer or delivery, the Released Securities and any interest thereon, shall be held in our name or in the name of our nominee in trust for your benefit, until the earlier of such time as (A) such [Corporate Units][Treasury Units] are transferred or your [Corporate Unit Certificate][Treasury Unit Certificate] is surrendered or satisfactory evidence is provided that your [Corporate Unit Certificate][Treasury Unit Certificate] has been destroyed, lost or stolen, together with any indemnification that we or the Company may require and (B) the expiration of the time period specified in the abandoned property laws of the relevant state. Date: ______________ By: JPMORGAN CHASE BANK, as Purchase Contract Agent _______________________________ Name: Title: EXHIBIT F NOTICE TO SETTLE BY CASH JPMORGAN CHASE BANK, as Purchase Contract Agent 450 West 33/rd/ Street, 15/th/ Floor New York, New York 10001 Attention: Institutional Trust Services Re: _______ [Corporate Units] [Treasury Units] of Dominion Resources, Inc. (the "Company") Upper DECS Equity Income Securities The undersigned Holder hereby irrevocably notifies you in accordance with Section 5.9 of the Purchase Contract Agreement, dated as of March 20, 2002 (the "Purchase Contract Agreement"; unless otherwise defined herein, terms defined in the Purchase Contract Agreement are used herein as defined therein), between the Company and you, as Purchase Contract Agent and as Attorney-in-Fact for the Holders of the Purchase Contracts, that such Holder has elected to pay to the Securities Intermediary for deposit in the Collateral Account, prior to 11:00 a.m. (New York City time) on the [fifth Business Day][Business Day] immediately preceding the Purchase Contract Settlement Date (in lawful money of the United States by certified or cashiers' check or wire transfer, in immediately available funds), $______ as the Purchase Price for the shares of Common Stock issuable to such Holder by the Company under the related Purchase Contract on the Purchase Contract Settlement Date. The undersigned Holder hereby instructs you to notify promptly the Collateral Agent of the undersigned Holder's election to make such cash settlement with respect to the Purchase Contracts related to such Holder's [Corporate Units] [Treasury Units] and to release the related [Senior Notes] [Treasury Securities] to such Holder upon such Cash Settlement. Date: _______________________ _______________________________________ Signature Signature Guarantee:___________________ Please print name and address of Registered Holder: ____________________________________ ____________________________________ Name Social Security or other Taxpayer Identification Number, if any Address ____________________________________ ____________________________________ ____________________________________ F-2 EXHIBIT G NOTICE FROM PURCHASE CONTRACT AGENT TO COLLATERAL AGENT AND INDENTURE TRUSTEE (Settlement of Purchase Contract through Remarketing) Bank One Trust Company, N.A. 153 West 51/st/ Street New York, New York 10019 Attention: Corporate Trust Administration Telecopy: (212) 373-1383 JPMORGAN CHASE BANK, as Indenture Trustee 450 West 33/rd/ Street, 15/th/ Floor New York, New York 10001 Attention: Institutional Trust Services Telecopy: : (212) 946-8159/8160 Re: Corporate Units of Dominion Resources, Inc. (the "Company") Upper DECS Equity Income Securities Please refer to the Purchase Contract Agreement, dated as of March 20, 2002 (the "Purchase Contract Agreement"; unless otherwise defined herein, terms defined in the Purchase Contract Agreement are used herein as defined therein), between the Company and the undersigned, as Purchase Contract Agent and as attorney-in-fact for the holders of Upper DECS Equity Income Securities from time to time. In accordance with Section 5.4[(b)][(d)] of the Purchase Contract Agreement [and based on Early Settlements and Collateral Substitutions occurring on or prior to 5:00 p.m. (New York City time) on the Election Date][and based on instructions received from Holders of Corporate Units prior to 5:00 p.m. (New York City time) on the sixth Business Day immediately preceding the Purchase Contract Settlement Date and notice from the Securities Intermediary regarding Cash Settlements received prior to 11:00 a.m. (New York City time) on the fifth Business Day immediately preceding the Purchase Contract Settlement Date], we hereby notify you that $_____ in aggregate principal amount of Pledged Senior Notes is to be tendered for purchase in the Remarketing. Date: ______________ By: JPMORGAN CHASE BANK, as Purchase Contract Agent ____________________________________ Name: Title: EXHIBIT H NOTICE FROM HOLDER TO INDENTURE TRUSTEE (Election to Tender for Purchase Senior Notes in the Remarketing) JPMorgan Chase Bank, as Indenture Trustee 450 West 33/rd/ Street, 15/th/ Floor New York, New York 10001 Attention: Institutional Trust Services Telecopy: : (212) 946-8159/8160 Re: $__________ in aggregate principal amount of 2002 Series A 5.75% Senior Notes due May 15, 2008 of Dominion Resources, Inc., a Virginia corporation (the "Company") The undersigned Holder hereby irrevocably notifies you in accordance with [Section 5.4(c)(i)] of the Purchase Contract Agreement, dated as of March 20, 2002 (the "Purchase Contract Agreement"; unless otherwise defined herein, terms defined in the Purchase Contract Agreement are used herein as defined therein), between the Company and JPMorgan Chase Bank, as Purchase Contract Agent, that it is a Holder of [____ Treasury Units that continues to hold the Senior Notes that were originally part of the ____ Corporate Units before they were converted into Treasury Units] [____ Corporate Units that effected Early Settlement but continues to hold the Senior Notes originally part of the ____ Corporate Units] [____ Treasury Units that effected Early Settlement but continues to hold the Senior Notes originally part of the ____ Corporate Units that were converted into the ____ Treasury Units] and it is electing to tender for purchase in the Remarketing $_____ in aggregate principal amount of Senior Notes. Date: _______________________ ____________________________________ Signature Signature Guarantee:__________________________ CC: Bank One Trust Company, N.A. Please print name and address of Registered Holder: ____________________________________ ____________________________________ Name Social Security or other Taxpayer Identification Number, if any Address ____________________________________ ____________________________________ ____________________________________ EX-4.4 6 dex44.txt FORM OF PLEDGE AGREEMENT Exhibit 4.4 ================================================================================ DOMINION RESOURCES, INC. and BANK ONE TRUST COMPANY, N.A., as Collateral Agent and BANK ONE TRUST COMPANY, N.A., as Securities Intermediary and JPMORGAN CHASE BANK, as Purchase Contract Agent ________________________ PLEDGE AGREEMENT Dated as of March 20, 2002 ================================================================================ Table of Contents
Page Section 1 Definitions ............................................... 2 Section 2 Pledge .................................................... 5 Section 2.1 Pledge ............................................ 5 Section 2.2 Control; Financing Statement ...................... 6 Section 2.3 Termination ....................................... 6 Section 3 Distributions on Pledged Collateral ....................... 6 Section 3.1 Income Distributions .............................. 6 Section 3.2 Principal Payments Following Termination Event .... 6 Section 3.3 Principal Payments Prior To or On Purchase Contract Settlement Date .......................... 6 Section 3.4 Payments to Purchase Contract Agent ............... 7 Section 3.5 Assets Not Properly Released ...................... 7 Section 4 Control ................................................... 8 Section 4.1 Establishment of Collateral Account ............... 8 Section 4.2 Treatment as Financial Assets ..................... 8 Section 4.3 Sole Control by Collateral Agent .................. 8 Section 4.4 Securities Intermediary's Location ................ 8 Section 4.5 No Other Claims ................................... 9 Section 4.6 Investment and Release ............................ 9 Section 4.7 Statements and Confirmations ...................... 9 Section 4.8 Tax Allocations ................................... 9 Section 4.9 No Other Agreements ............................... 9 Section 4.10 Powers Coupled With An Interest ................... 9 Section 5 Initial Deposit; Establishment of Treasury Units and Reestablishment of Corporate Units ........................ 10 Section 5.1 Initial Deposit of Senior Notes ................... 10 Section 5.2 Establishment of Treasury Units ................... 10 Section 5.3 Reestablishment of Corporate Units ................ 11 Section 5.4 Termination Event ................................. 12
Section 5.5 Cash Settlement .............................................. 13 Section 5.6 Early Settlement ............................................. 14 Section 5.7 Optional Remarketing ......................................... 16 Section 5.8 Application of Proceeds in Settlement; Remarketing ........... 15 Section 6 Voting Rights ........................................................ 19 Section 7 Rights and Remedies; Tax Event Redemption; Substitution .............. 19 Section 7.1 Rights and Remedies of the Collateral Agent .................. 19 Section 7.2 Tax Event Redemption ......................................... 20 Section 7.3 Substitutions ................................................ 22 Section 8 Representations and Warranties; Covenants ............................ 21 Section 8.1 Representations and Warranties ............................... 21 Section 8.2 Covenants .................................................... 22 Section 9 The Collateral Agent and the Securities Intermediary ................. 22 Section 9.1 Appointment, Powers and Immunities ........................... 22 Section 9.2 Instructions of the Company .................................. 23 Section 9.3 Reliance by Collateral Agent and Securities Intermediary ..... 23 Section 9.4 Rights in Other Capacities ................................... 24 Section 9.5 Non-Reliance on Collateral Agent and Securities Intermediary 24 Section 9.6 Compensation and Indemnity ................................... 24 Section 9.7 Failure to Act ............................................... 25 Section 9.8 Resignation of Collateral Agent and Securities Intermediary .. 25 Section 9.9 Right to Appoint Agent or Advisor ............................ 27 Section 9.10 Survival ..................................................... 27 Section 9.11 Exculpation 27 Section 10 Amendment ............................................................ 27 Section 10.1 Amendment Without Consent of Holders ......................... 27 Section 10.2 Amendment with Consent of Holders ............................ 28 Section 10.3 Execution of Amendments ...................................... 29 Section 10.4 Effect of Amendments ......................................... 29 Section 10.5 Reference to Amendments ...................................... 29
-ii- Section 11 Miscellaneous ....................................................... 29 Section 11.1 No Waiver ................................................... 29 Section 11.2 Governing Law ............................................... 29 Section 11.3 Notices ..................................................... 30 Section 11.4 Successors and Assigns ...................................... 30 Section 11.5 Counterparts ................................................ 30 Section 11.6 Severability ................................................ 30 Section 11.7 Expenses, etc ............................................... 30 Section 11.8 Security Interest Absolute .................................. 31
EXHIBIT A Instruction from Purchase Contract Agent to Collateral Agent (Establishment of Treasury Units) EXHIBIT B Instruction from Collateral Agent to Securities Intermediary (Establishment of Treasury Units) EXHIBIT C Instruction from Purchase Contract Agent to Collateral Agent (Reestablishment of Corporate Units) EXHIBIT D Instruction from Collateral Agent to Securities Intermediary (Reestablishment of Corporate Units) EXHIBIT E Notice of Cash Settlement from the Securities Intermediary to the Purchase Contract Agent -iii- PLEDGE AGREEMENT, dated as of March 20, 2002, among DOMINION RESOURCES, INC., a Virginia corporation (the "Company"), BANK ONE TRUST COMPANY, N.A., a national banking association, not individually but solely as collateral agent (in such capacity, together with its successors in such capacity, the "Collateral Agent"), BANK ONE TRUST COMPANY, N.A., not individually but solely in its capacity as a securities intermediary with respect to the Collateral Account (in such capacity, together with its successors in such capacity, the "Securities Intermediary"), and JPMORGAN CHASE BANK, a New York banking corporation, not individually but solely as purchase contract agent and as attorney-in-fact of the Holders from time to time of the Securities (in such capacity, together with its successors in such capacity, the "Purchase Contract Agent") under the Purchase Contract Agreement. RECITALS The Company and the Purchase Contract Agent are parties to the Purchase Contract Agreement dated as of the date hereof (as modified and supplemented and in effect from time to time, the "Purchase Contract Agreement"), pursuant to which there are being issued 6,000,000 Upper DECSSM Equity Income Securities (the "Securities") (or 6,600,000 Securities if the purchaser of the Certificates exercises its overallotment option in full), all of which will initially be Corporate Units. Each Corporate Unit, at issuance, consists of a unit comprised of (a) one stock purchase contract (the "Purchase Contract") under which (i) the Holder will purchase from the Company not later than the Purchase Contract Settlement Date, for an amount equal to $50 (the "Stated Amount"), a number of shares of Common Stock equal to the Settlement Rate or Early Settlement Rate, as the case may be, then in effect and (ii) the Company will pay the Holder Contract Adjustment Payments and (b) either beneficial ownership of (1) a 2002 Series A 5.75% Senior Note due May 15, 2008 of the Company (a "Senior Note"), having a principal amount equal to the Stated Amount and maturing on May 15, 2008 or (2) following a Remarketing or Tax Event Redemption of the Senior Note, in accordance with the Purchase Contract Agreement, the Remarketing Agreement or the Supplemental Indenture, as applicable, the Treasury Portfolio Interest, subject to the termination or settlement of the Purchase Contracts. In accordance with the terms of the Purchase Contract Agreement, a Holder of Corporate Units may separate the Senior Notes from the related Purchase Contracts by substituting on or before the Election Date, for such Senior Notes, Treasury Securities that will pay on maturity in the aggregate an amount equal to the aggregate Stated Amount of such Corporate Units. Upon such substitution, the Corporate Units will become Treasury Units in accordance with the terms of the Purchase Contract Agreement. Each Treasury Unit will be comprised of (a) one Purchase Contract and (b) a 1/20 undivided beneficial interest in a Treasury Security, subject to the termination or settlement of the Purchase Contracts. Pursuant to the terms of the Purchase Contract Agreement and the Purchase Contracts, the Holders of the Securities have irrevocably authorized the Purchase Contract Agent, as attorney-in-fact of such Holders, among other things, to execute and deliver this Agreement on behalf of such Holders and to grant the pledge provided herein of the Collateral Account to secure the Obligations. Accordingly, the Company, the Collateral Agent, the Securities Intermediary and the Purchase Contract Agent, on its own behalf and as attorney-in-fact of the Holders from time to time of the Securities, agree as follows: Section 1 Definitions. For all purposes of this Agreement, except as ----------- otherwise expressly provided or unless the context otherwise requires: (a) the terms defined in this Article have the meanings assigned to them in this Article and include the plural as well as the singular; (b) the words "herein," "hereof" and "hereunder" and other words of similar import refer to this Agreement as a whole and not to any particular Article, Section, Exhibit or other subdivision; (c) the following terms which are defined in the UCC shall have the meanings set forth therein: "certificated security," "control," "financial asset," "entitlement order," "securities account" and "security entitlement;" (d) the following terms and any other terms not defined in this Agreement have the meanings assigned to them in the Purchase Contract Agreement: "Act," "Bankruptcy Code," "Board Resolution," "Business Day," "Cash Settlement," "Certificate," "Common Stock," "Contract Adjustment Payments," "Corporate Unit," "Early Settlement," "Early Settlement Amount," "Early Settlement Rate," "Failed Remarketing," "Holder," "Indenture Trustee," "Officers' Certificate," "Opinion of Counsel," "Outstanding Securities," "Person," "Purchase Contract Settlement Date," "Purchase Price," "Quotation Agent," "Remarketing," "Remarketing Agent," "Remarketing Agreement," "Settlement Rate," "Successful Remarketing," "Supplemental Indenture," "Tax Event Redemption," "Tax Event Redemption Date," "Termination Event," "Treasury Portfolio Interest" and "Treasury Unit;" (e) the following terms have the meanings given to them in this section 1(e): "Agreement" means this Pledge Agreement, as the same may be amended, modified or supplemented from time to time. "Cash" means any coin or currency of the United States as at the time shall be legal tender for payment of public and private debts. "Collateral" means the collective reference to: (1) the Collateral Account; (2) all investment property and other financial assets from time to time credited to the Collateral Account, including, without limitation, (A) any Senior Notes or any Treasury Portfolio Interest then a component of the Corporate Units, and in each case, security entitlements relating thereto, (B) any Treasury Securities and security entitlements relating thereto delivered from time to time 2 upon establishment of Treasury Units in accordance with Section 5.2 hereof and (C) payments made by Holders pursuant to Section 5.5 hereof; (3) all Proceeds of any of the foregoing (whether such Proceeds arise before or after the commencement of any proceeding under any applicable bankruptcy, insolvency or other similar law, by or against the pledgor or with respect to the pledgor); and (4) all powers and rights now owned or hereafter acquired under or with respect to the Collateral Account. "Collateral Account" means the Securities Account No.6300018800 entitled "BANK ONE TRUST COMPANY, N.A., as Collateral Agent, DECS Securities Account (Dominion Resources, Inc.)" maintained by the Securities Intermediary for the Purchase Contract Agent on behalf of and as attorney-in-fact for the Holders. "Collateral Agent" means the Person named as the "Collateral Agent" in the paragraph preceding the recitals of this Agreement until a successor shall have become such in accordance with the terms of this Agreement, and thereafter "Collateral Agent" shall mean such successor. "Company" means the Person named as the "Company" in the first paragraph of this instrument until a successor shall have become such, and thereafter "Company" shall mean such successor. "Obligations" means, with respect to each Holder, the collective reference to all obligations and liabilities of such Holder under such Holder's Purchase Contract and this Agreement or any other document made, delivered or given in connection herewith or therewith, in each case whether on account of principal, interest (including, without limitation, interest accruing before and after the filing of any petition in bankruptcy, or the commencement of any insolvency, reorganization or like proceeding, relating to such Holder, whether or not a claim for post-filing or post-petition interest is allowed in such proceeding), fees, indemnities, costs, expenses or otherwise (including, without limitation, all fees and disbursements of counsel to the Company or the Collateral Agent or the Securities Intermediary that are required to be paid by the Holder pursuant to the terms of any of the foregoing agreements). "Permitted Investments" means any one of the following which shall mature not later than the next succeeding Business Day: (1) any evidence of indebtedness with an original maturity of 365 days or less issued, or directly and fully guaranteed or insured, by the United States of America or any agency or instrumentality thereof (provided that the full faith and credit of the United States of America is pledged in support of the timely payment thereof or such indebtedness constitutes a general obligation of it); (2) deposits, certificates of deposit or acceptances with an original maturity of 365 days or less of any institution which is a member of the Federal Reserve System having combined capital and surplus and undivided profits of not less than $200,000,000 at the time of deposit, which may include the Collateral Agent or any of its affiliates; 3 (3) investments with an original maturity of 365 days or less of any Person that are fully and unconditionally guaranteed by a bank referred to in clause (2); (4) repurchase agreements and reverse repurchase agreements relating to marketable direct obligations issued or unconditionally guaranteed by the United States Government or issued by any agency thereof and backed as to timely payment by the full faith and credit of the United States Government; (5) investments in commercial paper, other than commercial paper issued by the Company or its affiliates, of any corporation incorporated under the laws of the United States or any State thereof, which commercial paper has a rating at the time of purchase at least equal to "A-1" by Standard & Poor's Ratings Services ("S&P") or at least equal to "P-1" by Moody's Investors Service, Inc. ("Moody's"); and (6) investments in money market funds registered under the Investment Company Act of 1940, as amended, rated in the highest applicable rating category by S&P or Moody's, which may include such money market funds offered, administered or serviced by the Collateral Agent or any of its affiliates. "Pledge" means the lien and security interest created by this Agreement. "Pledged Senior Notes" means the Senior Notes and security entitlements with respect thereto from time to time credited to the Collateral Account and not then released from the Pledge. "Pledged Treasury Portfolio Interest" means the Treasury Portfolio Interest and security entitlements with respect thereto from time to time credited to the Collateral Account and not then released from the Pledge. "Pledged Treasury Securities" means Treasury Securities and security entitlements with respect thereto from time to time credited to the Collateral Account and not then released from the Pledge. "Proceeds" has the meaning ascribed thereto in the UCC and includes, without limitation, all interest, dividends, cash, instruments, securities, financial assets (as defined in (S) 8-102(a)(9) of the UCC) and other property received, receivable or otherwise distributed upon the sale, exchange, collection or disposition of any financial assets from time to time held in the Collateral Account. "Purchase Contract Agent" has the meaning specified in the paragraph preceding the recitals of this Agreement until a successor shall have become such in accordance with the terms of the Purchase Contract Agreement, and thereafter "Purchase Contract Agent" shall mean such successor. "Purchase Contract Agreement" has the meaning specified in the first paragraph of the recitals of this Agreement. 4 "Securities Intermediary" means the Person named as the "Securities Intermediary" in the paragraph preceding the recitals until a successor shall have become such in accordance with the terms of this Agreement, and thereafter "Securities Intermediary" shall mean such successor. "Separated Senior Notes" means any Senior Notes that are not Pledged Senior Notes. "TRADES" means the Treasury/Reserve Automated Debt Entry System maintained by the Federal Reserve Bank of New York pursuant to the TRADES Regulations. "TRADES Regulations" means the regulations of the United States Department of the Treasury, published at 31 C.F.R. Part 357, an amended from time to time. Unless otherwise defined herein, all terms defined in the TRADES Regulations are used herein as therein defined. "Transfer" means: (1) in the case of certificated securities in registered form, delivery as provided in (S) 8-301(a) of the UCC, indorsed to the transferee or in blank by an effective indorsement (2) in the case of Treasury Securities, registration of the transferee as the owner of such Treasury Securities on TRADES; and (3) in the case of security entitlements, including, without limitation, security entitlements with respect to Treasury Securities, a securities intermediary indicating by book entry that such security entitlement has been credited to the transferee's securities account. "Treasury Security" means a zero-coupon U.S. Treasury Security which has a principal amount at maturity of $1,000 and matures on or prior to the Business Day prior to the Purchase Contract Settlement Date. "UCC" means the Uniform Commercial Code as in effect in the State of New York from time to time. "Value" means, with respect to any item of Collateral on any date, as to (i) Cash, the face amount thereof, (ii) Senior Notes, the aggregate principal amount thereof, (iii) Treasury Securities, the aggregate principal amount thereof at maturity, and (iv) Treasury Portfolio Interest, the aggregate principal amount thereof at maturity. Section 2 Pledge. ------ Section 2.1 Pledge. ----------- ------ Each Holder, acting through the Purchase Contract Agent as such Holder's attorney-in-fact, hereby pledges and grants to the Collateral Agent, as agent of and for the benefit of the Company, a continuing first priority security interest in and to, and a lien upon and right of set off against, all of such Holder's right, title and interest in and to the Collateral to secure the 5 prompt and complete payment and performance when due (whether at stated maturity, by acceleration or otherwise) of the Obligations. The Collateral Agent shall have all of the rights, remedies and recourses with respect to the Collateral afforded a secured party by the UCC, in addition to, and not in limitation of, the other rights, remedies and recourses afforded to the Collateral Agent by this Agreement. Section 2.2 Control; Financing Statement. ----------- ---------------------------- (a) The Collateral Agent shall have control of the Collateral Account pursuant to the provisions of Section 4.3 of this Agreement. (b) On the date of initial issuance of the Securities, the Company shall file in the Office of the Secretary of State of the State of New York, a financing statement with the Purchase Contract Agent, as attorney-in-fact for the Holders, as debtor, and the Collateral Agent, as the secured party, describing the Collateral. Section 2.3 Termination. ----------- ----------- As to each Holder, this Agreement and the Pledge created hereby shall terminate upon the satisfaction of such Holder's Obligations. Upon termination, the Securities Intermediary shall, pursuant to written instructions received from the Purchase Contract Agent, Transfer any remaining Collateral to the Purchase Contract Agent for distribution to such Holder in accordance with its interest, free and clear of any lien, pledge or security interest created hereby. Section 3 Distributions on Pledged Collateral. ----------------------------------- Section 3.1 Income Distributions. ----------- -------------------- All income distributions, including interest, received by the Securities Intermediary or the Collateral Agent on account of the Pledged Senior Notes, Pledged Treasury Portfolio Interest, Pledged Treasury Securities or Permitted Investments from time to time held in the Collateral Account shall be distributed to the Purchase Contract Agent for the benefit of the applicable Holders as provided in the Purchase Contracts. Notwithstanding the foregoing, income distributions, including interest payments received by the Securities Intermediary or the Collateral Agent on account of the Treasury Portfolio Interest, shall not exceed the Treasury Portfolio Return. Section 3.2 Principal Payments Following Termination Event. ----------- ---------------------------------------------- All payments received by the Collateral Agent or the Securities Intermediary following a Termination Event with respect to (1) the Pledged Senior Notes or security entitlement with respect thereto, (2) the Pledged Treasury Portfolio Interest or security entitlement with respect thereto or (3) the Pledged Treasury Securities or security entitlement with respect thereto, shall, in each case, be distributed to the Purchase Contract Agent for the benefit of the applicable Holders for distribution to such Holders in accordance with their respective interests. Section 3.3 Principal Payments Prior To or On Purchase Contract ----------- --------------------------------------------------- Settlement Date. - --------------- 6 (a) Subject to the provisions of Section 7.2, and except as provided in clause 3.3(b) below, if, to the knowledge of the Collateral Agent and the Securities Intermediary, no Termination Event shall have occurred, all payments received by the Collateral Agent or the Securities Intermediary of (1) the principal amount with respect to the Pledged Senior Notes or security entitlement with respect thereto, (2) the principal amount with respect to the Pledged Treasury Portfolio Interest or security entitlement with respect thereto or (3) the principal amount with respect to the Pledged Treasury Securities or security entitlement with respect thereto, shall be held and invested at the written direction of the Company in Permitted Investments until the Purchase Contract Settlement Date and on the Purchase Contract Settlement Date distributed to the Company as provided in Section 5.8 hereof. Any balance remaining in the Collateral Account shall be distributed to the Purchase Contract Agent for the benefit of the applicable Holders for distribution to such Holders in accordance with their respective interests. Upon request of the Securities Intermediary or the Collateral Agent, as applicable, the Company shall instruct the Securities Intermediary or the Collateral Agent, as applicable, as to the type of Permitted Investments in which any payments made under this Section shall be invested, provided, however, that if the Company fails to deliver such instructions by 10:30 a.m. (New York City time), the Securities Intermediary or the Collateral Agent, as applicable, shall invest such payments in the Permitted Investments described in clause 6 of the definition of Permitted Investments. (b) All payments received by the Collateral Agent or the Securities Intermediary of (1) the principal amount with respect to the Pledged Senior Notes or security entitlements with respect thereto, (2) the principal amount with respect to the Pledged Treasury Portfolio Interest or security entitlements with respect thereto or (3) the principal amount of Treasury Securities or security entitlements with respect thereto that, in each case, have been released from the Pledge shall be distributed to the Purchase Contract Agent for the benefit of the Holders to be distributed to such Holders in accordance with their respective interests. Section 3.4 Payments to Purchase Contract Agent. ----------- ----------------------------------- Payments to the Purchase Contract Agent hereunder shall be made to the account designated by the Purchase Contract Agent for such purpose not later than 12:00 p.m. (New York City time) on the Business Day such payment is received by the Securities Intermediary; provided, however, that if such payment is received by the Securities Intermediary on a day that is not a Business Day or after 11:00 a.m. (New York City time) on a Business Day, then such payment shall be made no later than 10:30 a.m. (New York City time) on the next succeeding Business Day. Section 3.5 Assets Not Properly Released. ----------- ---------------------------- If the Purchase Contract Agent or any Holder shall receive any principal payments on account of financial assets credited to the Collateral Account and not released therefrom in accordance with this Agreement, the Purchase Contract Agent or such Holder shall hold the same as trustee of an express trust for the benefit of the Company and, upon receipt of an Officers' Certificate so directing, promptly deliver the same to the Securities Intermediary for credit to the Collateral Account or to the Company for application to the obligations of the Holders under the related Purchase Contracts, and the Purchase Contract Agent and Holders shall acquire no right, title or interest in any such payments of principal amounts so received. 7 Section 4 Control. ------- Section 4.1 Establishment of Collateral Account. ----------- ----------------------------------- The Securities Intermediary hereby confirms that: (1) the Securities Intermediary has established the Collateral Account; (2) the Collateral Account is a securities account; (3) subject to the terms of this Agreement, the Securities Intermediary shall treat the Purchase Contract Agent as entitled to exercise the rights that comprise any financial asset credited to the Collateral Account; (4) all property delivered to the Securities Intermediary pursuant to this Agreement or the Purchase Contract Agreement or the Indenture will be credited promptly to the Collateral Account; and (5) all securities or other property underlying any financial assets credited to the Collateral Account shall be registered in the name of the Securities Intermediary, indorsed to the Securities Intermediary, or in blank or credited to another securities account maintained in the name of the Securities Intermediary, and in no case will any financial asset credited to the Collateral Account be registered in the name of the Purchase Contract Agent or any Holder, payable to the order of the Purchase Contract Agent or any Holder or specially indorsed to the Purchase Contract Agent or any Holder. Section 4.2 Treatment as Financial Assets. ----------- ----------------------------- Each item of property (whether investment property, financial asset, security, instrument or cash) credited to the Collateral Account shall be treated as a financial asset. Section 4.3 Sole Control by Collateral Agent. ----------- -------------------------------- Except as provided in Section 6, at all times prior to the termination of the Pledge, the Collateral Agent shall have sole control of the Collateral Account, and the Securities Intermediary shall take instructions and directions with respect to the Collateral Account solely from the Collateral Agent. If at any time the Securities Intermediary shall receive an entitlement order issued by the Collateral Agent and relating to the Collateral Account, the Securities Intermediary shall comply with such entitlement order without further consent by the Purchase Contract Agent or any Holder or any other Person. Until termination of the Pledge, the Securities Intermediary will not comply with any entitlement orders issued by the Purchase Contract Agent or any Holder. Section 4.4 Securities Intermediary's Location. ----------- ---------------------------------- The Collateral Account and the rights and obligations of the Securities Intermediary, the Collateral Agent, the Purchase Contract Agent and the Holders with respect thereto shall be governed by the laws of the State of New York. Regardless of any provision in 8 any other agreement, for purposes of the UCC, New York shall be deemed to be the Securities Intermediary's location. Section 4.5 No Other Claims. ----------- --------------- Except for the claims and interest of the Collateral Agent, the Company, the Purchase Contract Agent and the Holders in the Collateral Account, the Securities Intermediary does not know of any claim to, or interest in, the Collateral Account or in any financial asset credited thereto. If any person asserts any lien, encumbrance or adverse claim (including any writ, garnishment, judgment, warrant of attachment, execution or similar process) against the Collateral Account or in any financial asset carried therein, the Securities Intermediary will promptly notify the Collateral Agent, the Purchase Contract Agent and the Company. Section 4.6 Investment and Release. ----------- ---------------------- All proceeds of financial assets from time to time deposited in the Collateral Account shall be invested and reinvested as provided in this Agreement. At all times prior to termination of the Pledge, no property shall be released from the Collateral Account except in accordance with this Agreement or upon written instructions of the Collateral Agent. Section 4.7 Statements and Confirmations. ----------- ---------------------------- The Securities Intermediary will promptly send copies of all statements, confirmations and other correspondence concerning the Collateral Account and any financial assets credited thereto simultaneously to each of the Purchase Contract Agent and the Collateral Agent at their addresses for notices under this Agreement. Section 4.8 Tax Allocations. ----------- --------------- The Company shall report all items of income, gain, expense and loss recognized in the Collateral Account to the Internal Revenue Service and all state and local taxing authorities under the names and taxpayer identification numbers of the Holders that are the beneficial owners thereof. Neither the Collateral Agent nor the Securities Intermediary shall have any responsibility for such tax reporting. Section 4.9 No Other Agreements. ----------- ------------------- The Securities Intermediary has not entered into, and prior to the termination of the Pledge will not enter into, any agreement with any other Person relating to the Collateral Account or any financial assets credited thereto, including, without limitation, any agreement to comply with entitlement orders of any Person other than the Collateral Agent. Section 4.10 Powers Coupled With An Interest. ------------ ------------------------------- The rights and powers granted in this Section 4 to the Collateral Agent have been granted in order to perfect its security interests in the Collateral Account, are powers coupled with an interest and will be affected neither by the bankruptcy of the Purchase Contract Agent or any Holder nor by the lapse of time. The obligations of the Securities Intermediary under this Section 4 shall continue in effect until the termination of the Pledge. 9 Section 5 Initial Deposit; Establishment of Treasury Units and Reestablishment - --------- -------------------------------------------------------------------- of Corporate Units. - ------------------ Section 5.1 Initial Deposit of Senior Notes. ----------- ------------------------------- Prior to or concurrently with the execution and delivery of this Agreement, the Purchase Contract Agent, on behalf of the initial Holders of the Corporate Units, shall Transfer to the Securities Intermediary, for credit to the Collateral Account, the Senior Notes or security entitlements relating to such Senior Notes, and, if the Transfer takes the form of security entitlements, the Securities Intermediary shall indicate by book entry that a securities entitlement with respect to such Senior Notes has been credited to the Collateral Account. Section 5.2 Establishment of Treasury Units. ----------- ------------------------------- (a) A Holder may separate the Senior Notes from the related Purchase Contracts in respect of such Holder's Corporate Units by substituting for such Senior Notes Treasury Securities in an aggregate principal amount equal to the aggregate principal amount of such Senior Notes at any time until 5:00 p.m. (New York City time), on the Election Date by: (1) providing notice to the Purchase Contract Agent, substantially in the form of Exhibit C of the Purchase Contract Agreement, of such Holder's intention to create Treasury Units; (2) for each group of 20 Corporate Units from which such Holder wishes to create Treasury Units, transferring a Treasury Security to the Securities Intermediary which shall then (y) deposit the Treasury Security with the Collateral Agent in the Collateral Account under this Agreement and instruct the Collateral Agent to hold such Treasury Security as Collateral under this Agreement and (z) instruct the Collateral Agent to release to such Holder $1,000 principal amount of Senior Notes formerly subject to the Pledge; (3) transferring the related Corporate Units to the Purchase Contract Agent accompanied by a notice to the Purchase Contract Agent, substantially in the form of Exhibit D to the Purchase Contract Agreement, stating that the Holder has transferred the relevant amount of Treasury Securities to the Securities Intermediary and requesting that the Purchase Contract Agent instruct the Collateral Agent to release the Senior Notes underlying such Corporate Units, whereupon the Purchase Contract Agent shall promptly give such instruction to the Collateral Agent, substantially in the form of Exhibit A hereto; and (4) paying to the Collateral Agent any fees or expenses incurred in connection with the Collateral Substitution; provided that, Holders may make Collateral Substitutions only in integral multiples of 20 Corporate Units. Under no circumstances may a Holder of Corporate Units create Treasury Units after 5:00 p.m. (New York City time) on the Election Date. Upon receipt from the Purchase Contract Agent of a notice substantially in the form of Exhibit A hereto, confirmation from the Securities Intermediary that Treasury Securities have been credited to the Collateral Account and receipt of payment for any fees or expenses incurred in connection 10 with the Collateral Substitution, the Collateral Agent shall instruct the Securities Intermediary by a notice, substantially in the form of Exhibit B hereto, to release such Pledged Senior Notes from the Pledge by Transfer to the Purchase Contract Agent for distribution to such Holder, free and clear of any lien, pledge or security interest created thereby. (b) Upon credit to the Collateral Account of Treasury Securities or security entitlements thereto delivered by a Holder of Corporate Units and receipt of the related instruction from the Collateral Agent, the Securities Intermediary shall release the Senior Notes specified in such instruction and shall promptly Transfer the same to the Purchase Contract Agent for distribution to such Holder, free and clear of any lien, pledge or security interest created hereby. A Holder may elect not to participate in the Remarketing by creating Treasury Units as specified in this Section and Section 5.4(f) of the Purchase Contract Agreement at any time until 5:00 p.m. (New York City time) on the Election Date. Section 5.3 Reestablishment of Corporate Units. ----------- ---------------------------------- (a) Unless a Tax Event Redemption has occurred, a Holder of a Treasury Unit may recreate Corporate Units at any time until 5:00 p.m. (New York City time), on the Election Date by: (1) providing notice to the Purchase Contract Agent, substantially in the form of Exhibit C of the Purchase Contract Agreement, of such Holder's intention to recreate Corporate Units; (2) for each Treasury Unit from which Holder wishes to recreate a Corporate Unit, transferring 20 Senior Notes to the Securities Intermediary which shall then (y) deposit such Senior Notes in the Collateral Account under this Agreement and instruct the Collateral Agent to hold such Senior Notes as Collateral and (z) instruct the Collateral Agent to release to such Holder one (1) Treasury Security, formerly subject to the Pledge; (3) transferring the related Treasury Units to the Purchase Contract Agent accompanied by a notice to the Purchase Contract Agent, substantially in the form of Exhibit D of the Purchase Contract Agreement, stating that the Holder has transferred the relevant amount of Senior Notes to the Securities Intermediary and requesting that the Purchase Contract Agent instruct the Collateral Agent to release the Treasury Securities underlying such Treasury Units, whereupon the Purchase Contract Agent shall promptly give such instruction to the Collateral Agent, substantially in the form of Exhibit C hereto; and (4) paying to the Collateral Agent any fees or expenses incurred in connection with the recreation of Corporate Units; provided that, Holders of Treasury Units may recreate Corporate Units in integral multiples of 20 Treasury Units for 20 Corporate Units. Under no circumstance may a Holder of Treasury Units recreate Corporate Units after 5:00 p.m. (New York City time) on the Election Date. Upon receipt from the Purchase Contract Agent of a notice substantially in the form of Exhibit C hereto, confirmation that Senior Notes or security entitlements thereto have been credited to the 11 Collateral Account as described in such notice and receipt of payment for any fees or expenses incurred in connection with the recreation of Corporate Units, the Collateral Agent shall instruct the Securities Intermediary by a notice, substantially in the form provided in Exhibit D hereto, to release such Pledged Treasury Securities from the Pledge by Transfer to the Purchase Contract Agent for distribution to such Holder, free and clear of any lien, pledge or security interest created thereby. (b) Upon credit to the Collateral Account of Senior Notes or security entitlements thereto delivered by a Holder of Treasury Units and receipt of the related instruction from the Collateral Agent, the Securities Intermediary shall release the applicable Treasury Securities specified in such instruction and shall promptly Transfer the same to the Purchase Contract Agent for distribution to such Holder, free and clear of any lien, pledge or security interest created hereby. Section 5.4 Termination Event. ----------- ----------------- (a) Upon receipt by the Collateral Agent of written notice from the Company or the Purchase Contract Agent that a Termination Event has occurred, the Collateral Agent shall release all Collateral from the Pledge and shall promptly Transfer any Pledged Senior Notes, any Pledged Treasury Portfolio Interest and any Pledged Treasury Securities to the Purchase Contract Agent for the benefit of the Holders, for distribution to such Holders in accordance with their respective interests, free and clear of any lien, pledge or security interest or other interest created hereby. (b) If such Termination Event shall result from the Company's becoming a debtor under the Bankruptcy Code, and if the Collateral Agent shall for any reason fail promptly to effectuate the release and Transfer of all Pledged Senior Notes, the Pledged Treasury Portfolio Interest or Pledged Treasury Securities, as the case may be, as provided by this Section 5.4, the Purchase Contract Agent shall: (1) request an opinion letter of a nationally recognized law firm reasonably acceptable to the Collateral Agent to the effect that, as a result of the Company's being the debtor in such a bankruptcy case, the Collateral Agent will not be prohibited from releasing or Transferring the Collateral as provided in this Section 5.4, and shall deliver such opinion to the Collateral Agent within ten days after the occurrence of such Termination Event, and if (A) the Purchase Contract Agent shall be unable to obtain such opinion within ten days after the occurrence of such Termination Event or (B) the Collateral Agent shall continue, after delivery of such opinion, to refuse to effectuate the release and Transfer of all Pledged Senior Notes, the Pledged Treasury Portfolio Interest or Pledged Treasury Securities or the Proceeds of any of the foregoing, as the case may be, as provided in this Section 5.4, then the Purchase Contract Agent shall within thirty days after the occurrence of such Termination Event commence an action or proceeding in the court having jurisdiction of the Company's case under the Bankruptcy Code seeking an order requiring the Collateral Agent to effectuate the release and transfer of all Pledged Senior Notes, the Pledged Treasury Portfolio Interest or all the Pledged Treasury Securities, as the case may be, as provided by this Section 5.4; or (2) commence an action or proceeding like that described in clause 5.4(b)(1)(B) hereof within ten days after the occurrence of such Termination Event. 12 The Purchase Contract Agent shall be deemed to have complied with Section 5.4(b)(1), and shall not be required to commence any action or proceeding referred to therein, if it shall have either obtained such an opinion letter or requested such an opinion from three such nationally recognized law firms reasonably acceptable to the Collateral Agent. Section 5.5 Cash Settlement. ----------- --------------- (a) Unless a Holder has effected an Early Settlement or a Successful Remarketing or a Tax Event Redemption has occurred, in the case of Corporate Units, and unless a Termination Event has occurred prior to dates required for notice to elect the Cash Settlement right specified in the Purchase Contract Agreement, upon receipt by the Collateral Agent of (1) a notice from the Purchase Contract Agent promptly after the receipt by the Purchase Contract Agent of a notice that a Holder of a Corporate Unit or Treasury Unit has elected, in accordance with the procedures specified in Section 5.9(B)(a)(i) or (B)(b)(i) of the Purchase Contract Agreement, respectively, to effect a Cash Settlement and (2) payment by such Holder to the Securities Intermediary for deposit in the Collateral Account on or prior to 11:00 a.m. (New York City time) on the fifth Business Day immediately preceding the Purchase Contract Settlement Date in the case of Corporate Units, and the Business Day immediately preceding the Purchase Contract Settlement Date in the case of the Treasury Units, of the Purchase Price in lawful money of the United States by certified or cashier's check or wire transfer of immediately available funds payable to or upon the order of the Securities Intermediary, then the Collateral Agent shall upon receipt of written directions from the Company: (1) instruct the Securities Intermediary promptly to invest any such Cash in Permitted Investments; (2) release from the Pledge (i) in the case of a Holder of Corporate Units, the related Pledged Senior Notes, or (ii) in the case of a Holder of Treasury Units, the related Pledged Treasury Securities, with a principal amount or principal amount at maturity, as the case may be, equal to the product of (x) the Stated Amount times (y) the number of Purchase Contracts as to which such Holder has elected to effect a Cash Settlement pursuant to this Section 5.5(a); and (3) instruct the Securities Intermediary to Transfer all such Pledged Senior Notes or Pledged Treasury Securities, as the case may be, to the Purchase Contract Agent for the benefit of such Holders, in each case free and clear of the Pledge created hereby, for distribution to such Holder. The Company shall instruct the Securities Intermediary as to the type of Permitted Investments in which any such Cash shall be invested; provided, however, that if the Company fails to deliver such instructions by 10:00 a.m. (New York City time), the Securities Intermediary shall invest such Cash in the Permitted Investments described in clause 6 of the definition of Permitted Investments. Upon receipt of the proceeds upon the maturity of the Permitted Investments on the Purchase Contract Settlement Date, the Collateral Agent shall (A) instruct the Securities Intermediary to pay the portion of such proceeds and deliver any certified or cashier's checks received, in an aggregate amount equal to the Purchase Price, to the Company on the Purchase Contract Settlement Date, and (B) instruct the Securities Intermediary to release any amounts in respect of the interest earned from such Permitted Investments to the Purchase Contract Agent for distribution to such Holder. 13 (b) If a Holder of a Corporate Unit notifies the Purchase Contract Agent as provided in Section 5.9(B)(a)(i) of the Purchase Contract Agreement of its intention to pay the Purchase Price in cash, but fails to make such payment as required by Section 5.9(B)(a)(ii) of the Purchase Contract Agreement, such Holder shall be deemed to have consented (A) to the disposition of the Pledged Senior Notes of such Holder in accordance with Section 5.9(B)(a)(iii) of the Purchase Contract Agreement or, (B) if a Failed Remarketing occurs, the Collateral Agent, for the benefit of the Company, and upon written direction of the Company as provided in this Agreement, exercising all of its rights as a secured party with respect to any Pledged Senior Notes under this Agreement and, subject to applicable law, by either (i) retaining such Senior Notes in full satisfaction of such Holder's obligations under the related Purchase Contracts or (ii) selling such Senior Notes in one or more public or private sales. (c) If a Holder of a Treasury Unit notifies the Purchase Contract Agent as provided in Section 5.9(B)(b)(i) of the Purchase Contract Agreement of its intention to pay the Purchase Price in cash, but fails to make such payment as required by Section 5.9(B)(b)(ii) of the Purchase Contract Agreement, such Holder shall be deemed to have elected to pay the Purchase Price in accordance with Section 5.9(B)(b)(iii) of the Purchase Contract Agreement. (d) Prior to 3:00 p.m. (New York City time) on the fourth Business Day immediately preceding the Purchase Contract Settlement Date, the Securities Intermediary shall deliver to the Purchase Contract Agent a notice, substantially in the form of Exhibit E hereto, stating the amount of cash that it has received with respect to the Cash Settlement of Corporate Units. (e) Prior to 3:00 p.m. (New York City time) on the Business Day immediately preceding the Purchase Contract Settlement Date, the Securities Intermediary shall deliver to the Purchase Contract Agent a notice, substantially in the form of Exhibit E hereto, stating the amount of cash that it has received with respect to the Cash Settlement of Treasury Units. Section 5.6 Early Settlement. ----------- ---------------- Unless a Termination Event has occurred, upon receipt by the Collateral Agent of a notice from the Purchase Contract Agent that a Holder of Securities has elected to effect Early Settlement of its obligations under the Purchase Contracts forming a part of such Securities in accordance with the terms of the Purchase Contracts and Section 5.9 of the Purchase Contract Agreement (which notice shall set forth the number of such Purchase Contracts as to which such Holder has elected to effect Early Settlement), and that the Purchase Contract Agent has received from such Holder, and paid to the Company as confirmed in writing by the Company, the related Early Settlement Amounts pursuant to the terms of the Purchase Contracts and the Purchase Contract Agreement and that all conditions to such Early Settlement have been satisfied, then the Collateral Agent shall release from the Pledge, (1) Pledged Senior Notes or Pledged Treasury Portfolio Interests as the case may be, in the case of a Holder of Corporate Units, or (2) Pledged Treasury Securities, in the case of a Holder of Treasury Units, with a Value equal to the product of (i) the Stated Amount times (ii) the number of Purchase Contracts as to which such Holder has elected to effect Early Settlement, and shall instruct the Securities Intermediary to Transfer all such Pledged Senior Notes, Pledged Treasury Portfolio Interests or Pledged Treasury Securities, as the case may be, to the Purchase Contract Agent for the benefit of such Holder, in each case free and clear of the Pledge created hereby, for distribution to such Holder. 14 Notwithstanding anything to the contrary contained herein, Holders may not effect Early Settlement after 5:00 p.m. (New York City time) on the Election Date and Holders may effect Early Settlement of Securities only in integral multiples of 20 Corporate Units or 20 Treasury Units. In addition, if a Tax Event Redemption occurred and the Redemption Treasury Portfolio has become a part of the Corporate Units, Purchase Contracts underlying the Corporate Units may be settled early but only in an aggregate amount of 20 Corporate Units or another integral multiple such that the Treasury Portfolio Interests to be released are in integral multiples of $1,000. Section 5.7 Optional Remarketing. ----------- -------------------- Pursuant to the Supplemental Indenture and the Remarketing Agreement, on or prior to 5:00 p.m. (New York City time) on the Election Date, registered holders of Separated Senior Notes may elect to have their Separated Senior Notes remarketed by Transferring their Separated Senior Notes to the Collateral Agent and giving a notice of such election, substantially in the form of Exhibit H to the Purchase Contract Agreement, to the Collateral Agent and the Trustee, whereupon, the Collateral Agent shall hold such Separated Senior Notes in an account separate from the Collateral Account and cause such Separated Senior Notes to be included in the Remarketing pursuant to the Supplemental Indenture and the Remarketing Procedures. Once such holder of such Separated Senior Notes delivers such notice and Separated Senior Notes as specified in the preceding sentence, such election may not be withdrawn and may not be conditioned upon the level at which the Reset Rate is established in the Remarketing; provided, however, that if such a holder delivers only such a notice but not the Separated Senior Notes subject to the notice, then none of such Holders' Separated Senior Notes shall be included in the Remarketing. If there is a Successful Remarketing, the Collateral Agent shall Transfer such Separated Senior Notes in accordance with the instructions provided by the Remarketing Agent pursuant to the Remarketing Agreement. If a Failed Remarketing occurs, the Remarketing Agent shall Transfer to the Collateral Agent, by the third Business Day following the Failed Remarketing, such Separated Senior Notes, whereupon the Collateral Agent shall promptly Transfer such Separated Senior Notes to the holders entitled thereto. Section 5.8 Application of Proceeds in Settlement; Remarketing. ----------- -------------------------------------------------- (a) Unless a Termination Event or a Tax Event Redemption has occurred or a Holder has effected an Early Settlement (i) the Purchase Contract Agent shall notify, by 11:00 a.m. (New York City time), on the Business Day immediately preceding the Initial Remarketing Date, the Remarketing Agent, the Collateral Agent, the Trustee and the Company of the aggregate principal amount of Pledged Senior Notes comprising part of the Corporate Units to be remarketed, other than those Pledged Senior Notes of Holders that have elected not to participate in the Remarketing pursuant to Section 106 of the Supplemental Indenture and Section 5.4(f) of the Purchase Contract Agreement, and (ii) the Collateral Agent shall notify, by 11:00 a.m. (New York City time), on the Business Day immediately preceding the Initial Remarketing Date, the Remarketing Agent, the Trustee and the Company of the aggregate principal amount of Separated Senior Notes of holders of Separated Senior Notes that have elected to participate in the Remarketing (the Senior Notes described in clauses (i) and (ii) collectively being referred to as the "Remarketing Senior Notes") and, concurrently therewith, the Collateral Agent shall, 15 without any further instruction from any holder of the Remarketing Senior Notes, present all Remarketing Senior Notes to the Remarketing Agent for Remarketing. If there has been a Successful Initial Remarketing or a Successful Subsequent Remarketing, the Remarketing Agent will on the Remarketing Settlement Date of such Remarketing (i) deduct and retain for itself as a remarketing fee an amount not exceeding 25 basis points (0.25%) of the principal amount of each remarketed Remarketing Senior Note , (ii) use the remaining Proceeds with respect to the Pledged Senior Notes from such Successful Remarketing to purchase the Treasury Portfolio and, on or prior to the third Business Day following the Remarketing Date, deliver such Treasury Portfolio to the Collateral Agent, which shall thereupon, for the benefit of the Company, apply such Treasury Portfolio, to secure the obligation of all Holders of Corporate Units to purchase Common Stock under the Purchase Contracts constituting a part of such Corporate Units, in substitution for the Pledged Senior Notes, (iii) if any Separated Senior Notes were remarketed, remit to the Collateral Agent for payment to the holders of such Separated Senior Notes sold the amounts specified in clauses 1(ii) and 2(ii) of the definition of "Remarketing Value" in the Purchase Contract Agreement and (iv) if there then remains any proceeds from such Successful Remarketing, after the application of such proceeds as set forth in clauses (i) through (iii) above, then remit any such remaining proceeds attributable to the remarketed Pledged Senior Notes to the Purchase Contract Agent for the benefit of the holders of such Remarketed Senior Notes and to the Collateral Agent for benefit of the holders of any remarketed Separate Senior Notes, on a pro rata basis, provided; however, that if such Successful Remarketing is consummated after 4:30 p.m. (New York City time) on the Remarketing Date and, despite using its commercially reasonable efforts, the Remarketing Agent cannot cause the applications of the proceeds specified above to occur on the Remarketing Settlement Date, then the Remarketing Agent may make such applications and remittances on the next succeeding Business Day. Holders of the Remarketing Senior Notes that are so remarketed will not otherwise be responsible for the payment of any remarketing fee or expenses in connection with the Remarketing. On the Remarketing Settlement Date or the next succeeding Business Day, as applicable, the Remarketing Agent shall deliver the Treasury Portfolio to the Collateral Agent as set forth above in this paragraph. The Collateral Agent, for the benefit of the Company, will thereupon apply such Treasury Portfolio to secure such Holder's obligation under the Purchase Contracts, as provided herein. In the event that any portion of the Pledged Treasury Portfolio Interest matures before the Purchase Contract Settlement Date, the Collateral Agent shall invest the Cash Proceeds therefrom in Permitted Investments in clause 6 of the definition of Permitted Investments, unless the Company shall otherwise instruct the Securities Intermediary and the Collateral Agent as to the type of Permitted Investments in which any such Cash Proceeds shall be invested. The Collateral Agent shall cause the Securities Intermediary to remit, on the Purchase Contract Settlement Date, a portion of the Cash Proceeds of the maturing Pledged Treasury Portfolio Interest and of the investment earnings from the related investment in Permitted Investments, in an aggregate amount equal to the Treasury Portfolio Return to the Purchase Contract Agent for the benefit of the Holders of the related Corporate Units when received. Without receiving any instruction from any such Holder of Corporate Units, the Collateral Agent shall apply, on the Purchase Contract Settlement Date, the Cash Proceeds of the maturing Pledged Treasury Portfolio Interest and of the investment earnings from the related investment in Permitted Investments, in an aggregate amount equal to the aggregate Purchase Price applicable to such Corporate Units to satisfy in full such Holder's obligations to pay the 16 Purchase Price to purchase the shares of Common Stock under the related Purchase Contracts on the Purchase Contract Settlement Date. In the event the sum of the Proceeds from the related Pledged Treasury Portfolio Interest and the investment earnings from the related investment in Permitted Investments exceeds the sum of the related Treasury Portfolio Return and the aggregate Purchase Price of the Purchase Contracts being settled thereby, the Collateral Agent shall instruct the Securities Intermediary to distribute such excess, when received, to the Purchase Contract Agent for distribution to the Holders whose Purchase Contracts were settled with such Proceeds, on a pro rata basis If, by 4:00 p.m. (New York City time), on the ninth Business Day preceding the Purchase Contract Settlement Date, the Remarketing Agent, despite using its commercially reasonable efforts, has been and is unable to remarket all of the Remarketing Senior Notes tendered for purchase at a price equal to at least the Remarketing Value, the Remarketing Agent shall Transfer to the Collateral Agent, by the sixth Business Day preceding the Purchase Contract Settlement Date, the Pledged Senior Notes that were to be remarketed in the Initial or Subsequent Remarketing, whereupon the Collateral Agent shall, for the benefit of the Company, hold such Pledged Senior Notes, to secure the obligation of the related Holders of Corporate Units to purchase Common Stock under the related Purchase Contracts. (b) Unless a Termination Event has occurred or a Holder has settled the related Purchase Contract through a Cash Settlement or an Early Settlement or a Successful Remarketing or a Tax Event Redemption has occurred, each Holder shall be deemed to have consented to the Remarketing of its Pledged Senior Notes in the Final Remarketing on the Final Remarketing Date, in a Remarketing in accordance with Section 5.4(d) of the Purchase Contract Agreement. The Purchase Contract Agent, shall by 11:00 a.m. (New York City time), on the Business Day immediately preceding the Final Remarketing Date, notify the Remarketing Agent, the Collateral Agent, the Trustee and the Company of such event and the aggregate principal amount of Pledged Senior Notes of Corporate Unit Holders to be remarketed on the Final Remarketing Date, whereupon the Collateral Agent, shall concurrently therewith, without any instruction from such Holders of Corporate Units with respect to their Pledged Senior Notes, transfer the Remarketing Senior Notes to the Remarketing Agent for Remarketing. Upon receiving such Remarketing Senior Notes, the Remarketing Agent, pursuant to the terms of the Remarketing Agreement, will use its commercially reasonable efforts to remarket such Remarketing Senior Notes on the Final Remarketing Date. If the Final Remarketing is successful, the Remarketing Agent will on the Remarketing Settlement Date or the Purchase Contract Settlement Date, as applicable, (i) deduct and retain for itself the Remarketing Fee pursuant to the Remarketing Agreement, (ii) cause the remaining Proceeds of the Remarketing with respect to the Pledged Senior Notes in an amount equal to the aggregate principal amount of such Senior Notes to be delivered to the Collateral Agent, on the Remarketing Settlement Date, (iii), if any Separated Senior Notes were remarketed, remit to the Collateral Agent for payment to the holders of such Separated Senior Notes sold in the Remarketing the remaining proceeds from such Successful Remarketing attributable to the Separated Senior Notes in an amount equal to the principal amount of such Senior Notes and (iv) if there then remains any proceeds from such Successful Remarketing, after the application of such proceeds as set forth in clauses (i) through (iii) above, remit any excess Proceeds of the Remarketing to the Purchase Contract Agent for the benefit of the Holders of Pledged Senior Notes and to the Collateral Agent for the benefit of the Holders of the Separated Senior Notes, on a pro rata basis; provided, however, that if such Successful Final 17 Remarketing is consummated after 4:30 p.m. (New York City time) on the Remarketing Date and, despite using its commercially reasonable efforts, the Remarketing Agent cannot cause the application of the proceeds specified above to occur on the Remarketing Settlement Date, then the Remarketing Agent may make such applications and remittances on the next succeeding Business Day. Holders of the Remarketing Senior Notes that are so remarketed will not otherwise be responsible for the payment of any remarketing fee or expenses in connection with the Remarketing. The Purchase Contract Agent shall give written directions to the Collateral Agent, and the Collateral Agent shall instruct the Securities Intermediary, to apply a portion of the Proceeds with respect to the Pledged Senior Notes from such Remarketing, on the Purchase Contract Settlement Date, equal to the aggregate principal amount of such Pledged Senior Notes to satisfy in full the obligations of such Holders of Corporate Units to pay the Purchase Price to purchase the shares of Common Stock under the related Purchase Contracts. If a Failed Remarketing occurs, the Collateral Agent, having received notice of such Failed Remarketing from the Remarketing Agent pursuant to the Remarketing Agreement, shall, on the written direction of the Company, exercise for the benefit of the Company, its rights as a secured creditor with respect to the Pledged Senior Notes and, subject to applicable law, may (i) retain such Pledged Senior Notes in full satisfaction of the Holders' obligations under the Purchase Contracts or (ii) sell such Pledged Senior Notes in one or more public or private sales, the proceeds, if any, of such sale to constitute full satisfaction of the Holders' obligations under the Purchase Contracts (c) Unless a Termination Event has occurred or a Holder has effected a Cash Settlement or an Early Settlement, upon a Successful Remarketing, a Holder shall be deemed to have elected to pay for the shares of Common Stock to be issued under such Purchase Contracts from the Proceeds of the Pledged Treasury Portfolio, in the case of Holders of Corporate Units, and the related Pledged Treasury Securities, in the case of Holders of Treasury Units. (d) In the event that following a Tax Event Redemption, all or any portion of the Pledged Treasury Portfolio Interest matures before the Purchase Contract Settlement Date, the Collateral Agent shall invest the proceeds therefrom in Permitted Investments. The Collateral Agent shall cause the Securities Intermediary to remit, on the Purchase Contract Settlement Date, a portion of the proceeds of the maturing Pledged Treasury Portfolio Interest and of the investment earnings from the related investment in Permitted Investments, in each case, in an amount equal to the Treasury Portfolio Return to the Purchase Contract Agent for the benefit of the Holders of the related Corporate Units when received. Without receiving any instruction from any such Holder of Corporate Units, the Collateral Agent shall apply, on the Purchase Contract Settlement Date, the proceeds of the maturing Pledged Treasury Portfolio Interest and of the investment earnings from the related investment in Permitted Investments in an aggregate amount equal to the aggregate Purchase Price applicable to such Corporate Units to satisfy in full such Holder's obligations to pay the Purchase Price to purchase the shares of Common Stock under the related Purchase Contracts on the Purchase Contract Settlement Date. In the event the sum of the proceeds from the related Pledged Treasury Portfolio Interest and the investment earnings from the related investment in Permitted Investments exceeds the sum of the related Treasury Portfolio Return and the aggregate Purchase Price of the Purchase Contracts being settled thereby, the Collateral Agent shall instruct the Securities Intermediary to distribute such excess, when received, to the Purchase Contract Agent for distribution to the Holders whose Purchase Contracts were settled with such proceeds, on a pro rata basis. 18 (e) In the event that all or any portion of the Pledged Treasury Securities matures before the Purchase Contract Settlement Date, the Collateral Agent shall invest the Cash Proceeds therefrom in Permitted Investments in clause 6 of the definition of Permitted investments, unless the Company shall otherwise instruct the Securities Intermediary and the Collateral Agent as to the type of Permitted Investments in which any such Cash Proceeds shall be invested. (f) Without receiving any instruction from any such Holder of Treasury Units, the Collateral Agent shall apply, on the Purchase Contract Settlement Date, the Cash Proceeds of the maturing Pledged Treasury Securities and of the investment earnings from the related investment in Permitted Investments, in each case, in an amount equal to the aggregate Purchase Price applicable to such Treasury Units to satisfy in full such Holder's obligations to pay the Purchase Price to purchase the shares of Common Stock under the related Purchase Contracts on the Purchase Price Settlement Date. In the event the sum of the Proceeds from the related Pledged Treasury Securities and the investment earnings from the related investment in Permitted Investments exceeds the aggregate Purchase Price of the Purchase Contracts being settled thereby, the Collateral Agent shall instruct the Securities Intermediary to distribute such excess, when received, to the Purchase Contract Agent for distribution to the Holders whose Purchase Contracts were settled with such Proceeds, on a pro rata basis. (g) Notwithstanding the Pledge and, if applicable, the delivery of Separated Senior Notes to the Collateral Agent for Remarketing, in each case, as set forth herein, the Company's obligation to pay interest, including any accrued and unpaid interest, on all outstanding Senior Notes (whether then comprising a part of Corporate Units or as Separated Senior Notes) pursuant to the Supplemental Indenture shall remain. Section 6 Voting Rights. ------------- The Purchase Contract Agent, acting on behalf of the Holders, may exercise, or refrain from exercising, any and all voting and other consensual rights pertaining to the Pledged Senior Notes or any part thereof for any purpose not inconsistent with the terms of this Agreement and in accordance with the terms of the Purchase Contract Agreement; provided, that the Purchase Contract Agent shall give the Company and the Collateral Agent at least five days' prior written notice of the manner in which it intends to exercise, or its reasons for refraining from exercising, any such right. Upon receipt of any notices and other communications in respect of any Pledged Senior Notes, including notice of any meeting at which holders of the Senior Notes are entitled to vote or solicitation of consents, waivers or proxies of holders of the Senior Notes, the Collateral Agent shall use reasonable efforts to send promptly to the Purchase Contract Agent such notice or communication, and as soon as reasonably practicable after receipt of a written request therefor from the Purchase Contract Agent, execute and deliver to the Purchase Contract Agent such proxies and other instruments in respect of such Pledged Senior Notes (in form and substance satisfactory to the Collateral Agent) as are prepared by the Purchase Contract Agent with respect to the Pledged Senior Notes. Section 7 Rights and Remedies; Tax Event Redemption; Substitution. ------------------------------------------------------- Section 7.1 Rights and Remedies of the Collateral Agent. ----------- ------------------------------------------- 19 (a) In addition to the rights and remedies specified in Section 5.5 hereof or otherwise available at law or in equity, after an event of default (as specified in Section 7.1(b) below) hereunder, the Collateral Agent shall have all of the rights and remedies with respect to the Collateral of a secured party under the UCC (whether or not the UCC is in effect in the jurisdiction where the rights and remedies are asserted) and the TRADES Regulations and such additional rights and remedies to which a secured party is entitled under the laws in effect in any jurisdiction where any rights and remedies hereunder may be asserted. Without limiting the generality of the foregoing, such remedies may include, to the extent permitted by applicable law, (i) retention of the Pledged Senior Notes, Pledged Treasury Portfolio Interest or Pledged Treasury Securities in full satisfaction of the Holders' obligations under the Purchase Contracts or (ii) sale of the Pledged Senior Notes, Pledged Treasury Portfolio Interest or Pledged Treasury Securities in one or more public or private sales. (b) Without limiting any rights or powers otherwise granted by this Agreement to the Collateral Agent, in the event the Collateral Agent is unable to make payments to the Company on account of principal payments of any Pledged Treasury Securities or Pledged Treasury Portfolio Interest as provided in Section 3 hereof, in satisfaction of the Obligations of the Holder of the Securities of which such Pledged Treasury Securities or Pledged Treasury Portfolio Interest are a part under the related Purchase Contracts, the inability to make such payments shall constitute an event of default hereunder and the Collateral Agent shall have and may exercise, with reference to such Pledged Treasury Securities or Pledged Treasury Portfolio Interest, as applicable, and such Obligations of such Holder, any and all of the rights and remedies available to a secured party under the UCC and the TRADES Regulations after default by a debtor, and as otherwise granted herein or under any other law. (c) Without limiting any rights or powers otherwise granted by this Agreement to the Collateral Agent, the Collateral Agent is hereby irrevocably authorized to receive and collect all payments of (i) the principal amount of the Pledged Senior Notes, (ii) the principal amount of the Pledged Treasury Securities and (iii) the principal amount of the Pledged Treasury Portfolio Interest, subject, in each case, to the provisions of Section 3 hereof, and as otherwise granted herein. (d) The Purchase Contract Agent and each Holder of Securities agree that, from time to time, upon the written request of the Collateral Agent, the Purchase Contract Agent or such Holder shall execute and deliver such further documents and do such other acts and things as the Collateral Agent may reasonably request in order to maintain the Pledge, and the perfection and priority thereof, and to confirm the rights of the Collateral Agent hereunder. The Purchase Contract Agent shall have no liability to any Holder for executing any documents or taking any such acts requested by the Collateral Agent hereunder, except for liability for its own negligent acts, its own negligent failure to act or its own willful misconduct. Section 7.2 Tax Event Redemption. ----------- --------------------- Upon the occurrence of a Tax Event Redemption prior to the Purchase Contract Settlement Date, the aggregate Redemption Price payable on the Tax Event Redemption Date with respect to the Pledged Senior Notes shall be delivered to the Collateral Agent by the Indenture Trustee on or prior to 12:00 p.m. (New York City time) by wire transfer in immediately available funds at such place and at such account as may be designated by the 20 Collateral Agent in exchange for the Pledged Senior Notes. In the event the Collateral Agent receives such Redemption Price, the Collateral Agent will, at the written direction of the Company, apply an amount, out of such Redemption Price, equal to the aggregate Redemption Amount with respect to the Pledged Senior Notes to purchase from the Quotation Agent, the Redemption Treasury Portfolio and promptly remit the remaining portion of such Redemption Price to the Purchase Contract Agent for payment to the Holders of Corporate Units. The Collateral Agent shall Transfer the Redemption Treasury Portfolio Interest to the Collateral Account to secure the obligation of all Holders of Corporate Units to purchase Common Stock of the Company under the Purchase Contracts constituting a part of such Corporate Units, in substitution for the Pledged Senior Notes. Thereafter the Collateral Agent shall have such security interests, rights and obligations with respect to the Redemption Treasury Portfolio Interests as it had in respect of the Pledged Senior Notes as provided in this Agreement, and any reference herein to the Senior Notes shall be deemed to be reference to such Redemption Treasury Portfolio Interests, and any reference herein to interest on the Senior Notes shall be deemed to be a reference to distributions on such Treasury Portfolio Interest. Section 7.3 Substitutions. ----------- ------------- Whenever a Holder has the right to substitute Treasury Securities, Senior Notes or security entitlements to either of them for financial assets held in the Collateral Account, such substitution shall not constitute a novation of the security interest created hereby. Section 8 Representations and Warranties; Covenants. ----------------------------------------- Section 8.1 Representations and Warranties. ----------- ------------------------------ Each Holder from time to time, acting through the Purchase Contract Agent as attorney-in-fact (it being understood that the Purchase Contract Agent shall not be liable for any representation or warranty made by or on behalf of a Holder), hereby represents and warrants to the Collateral Agent (with respect to its interest in the Collateral), which representations and warranties shall be deemed repeated on each day a Holder Transfers Collateral that: (1) such Holder has the power to grant a security interest in and lien on the Collateral; (2) such Holder is the sole beneficial owner of the Collateral and, in the case of Collateral delivered in physical form, is the sole holder of such Collateral and is the sole beneficial owner of, or has the right to Transfer, the Collateral it Transfers to the Securities Intermediary for credit to the Collateral Account, free and clear of any security interest, lien, encumbrance, call, liability to pay money or other restriction other than the security interest and lien granted under Section 2 hereof; (3) upon the Transfer of the Collateral to the Securities Intermediary for credit to the Collateral Account, the Collateral Agent, for the benefit of the Company, will have a valid and perfected first priority security interest therein (assuming that any central clearing operation or any securities intermediary or other entity not within the control of the Holder involved in the Transfer of the Collateral, including the Collateral Agent and the Securities Intermediary, gives the notices and takes the action required of it hereunder 21 and under applicable law for perfection of that interest and assuming the establishment and exercise of control pursuant to Section 4 hereof); and (4) the execution and performance by the Holder of its obligations under this Agreement will not result in the creation of any security interest, lien or other encumbrance on the Collateral other than the security interest and lien granted under Section 2 hereof or violate any provision of any existing law or regulation applicable to it or of any mortgage, charge, pledge, indenture, contract or undertaking to which it is a party or which is binding on it or any of its assets. Section 8.2 Covenants. ----------- --------- The Purchase Contract Agent and the Holders from time to time, acting through the Purchase Contract Agent as their attorney-in-fact (it being understood that the Purchase Contract Agent shall not be liable for any covenant made by or on behalf of a Holder), hereby covenant to the Collateral Agent that for so long as the Collateral remains subject to the Pledge: (1) neither the Purchase Contract Agent nor such Holders will create or purport to create or allow to subsist any mortgage, charge, lien, pledge or any other security interest whatsoever over the Collateral or any part of it other than pursuant to this Agreement; and (2) neither the Purchase Contract Agent nor such Holders will sell or otherwise dispose (or attempt to dispose) of the Collateral or any part of it except for the beneficial interest therein, subject to the Pledge hereunder, transferred in connection with the Transfer of the Securities. Section 9 The Collateral Agent and the Securities Intermediary. ---------------------------------------------------- It is hereby agreed as follows: Section 9.1 Appointment, Powers and Immunities. ----------- ---------------------------------- The Collateral Agent and the Securities Intermediary shall each act as agent for the Company hereunder with such powers as are specifically vested in the Collateral Agent or the Securities Intermediary, as the case may be, by the terms of this Agreement, together with such other powers as are reasonably incidental thereto. The Collateral Agent and the Securities Intermediary shall: (1) have no duties or responsibilities except those expressly set forth in this Agreement and no implied covenants or obligations shall be inferred from this Agreement against the Collateral Agent or the Securities Intermediary, nor shall the Collateral Agent or the Securities Intermediary be bound by the provisions of any agreement by any party hereto beyond the specific terms hereof; (2) not be responsible for, and neither the Collateral Agent nor the Securities Intermediary makes any representation or warranty with respect to, any recitals contained in this Agreement, or in any certificate or other document referred to or provided for in, or received by it under, this Agreement, the Securities or the Purchase Contract 22 Agreement, or for the value, validity, effectiveness, genuineness, enforceability or sufficiency of this Agreement (other than as against the Collateral Agent or the Securities Intermediary, as the case may be), the Securities or the Purchase Contract Agreement or any other document referred to or provided for herein or therein or for any failure by the Company or any other Person (except the Collateral Agent or the Securities Intermediary, as the case may be) to perform any of its obligations hereunder or thereunder or for the perfection, priority or, except, in the case of the Collateral Agent, as expressly required hereby, maintenance of any security interest created hereunder; (3) not be required to initiate or conduct any litigation or collection proceedings hereunder (except, in the case of the Collateral Agent, pursuant to directions furnished under Section 9.2 hereof, subject to Section 9.6 hereof); (4) not be responsible for any action taken or omitted to be taken by it hereunder or under any other document or instrument referred to or provided for herein or in connection herewith or therewith, except for its own negligence or willful misconduct; and (5) not be required to advise any party as to selling or retaining, or taking or refraining from taking any action with respect to, any securities or other property deposited hereunder. Subject to the foregoing, during the term of this Agreement, the Collateral Agent shall take all reasonable action in connection with the safekeeping and preservation of the Collateral hereunder. No provision of this Agreement shall require the Collateral Agent toexpend or risk its own funds or otherwise incur any financial liability in the performance of any of its duties hereunder. In no event shall the Collateral Agent or the Securities Intermediary be liable for any amount in excess of the Value of the Collateral. Notwithstanding the foregoing, each of the Collateral Agent and the Securities Intermediary in its individual capacity hereby waives any right of setoff, bankers' lien, liens or perfection rights as securities intermediary or any counterclaim with respect to any of the Collateral. Section 9.2 Instructions of the Company. ----------- --------------------------- The Company shall have the right, by one or more instruments in writing executed and delivered to the Collateral Agent, to direct the time, method and place of conducting any proceeding for the realization of any right or remedy available to the Collateral Agent, or of exercising any power conferred on the Collateral Agent, or to direct the taking or refraining from taking of any action authorized by this Agreement; provided, however, that (i) such direction shall not conflict with the provisions of any law or of this Agreement and (ii) the Collateral Agent shall be adequately indemnified as provided herein. Nothing contained in this Section 9.2 shall impair the right of the Collateral Agent in its discretion to take any action or omit to take any action which it deems proper and which is not inconsistent with such direction. Section 9.3 Reliance by Collateral Agent and Securities Intermediary. ----------- -------------------------------------------------------- 23 Each of the Securities Intermediary and the Collateral Agent shall be or entitled to rely upon any certification, order, judgment, opinion, notice or other communication (including, without limitation, any thereof by telephone, telecopy, telex or facsimile) believed by it to be genuine and correct and to have been signed or sent by or on behalf of the proper Person or Persons (without being required to determine the correctness of any fact stated therein) and upon advice and statements of legal counsel and other experts selected by the Collateral Agent or the Securities Intermediary, as the case may be. As to any matters not expressly provided for by this Agreement, the Collateral Agent and the Securities Intermediary shall in all cases be fully protected in acting, or in refraining from acting, hereunder in accordance with instructions given by the Company in accordance with this Agreement. Section 9.4 Rights in Other Capacities. ----------- -------------------------- The Collateral Agent and the Securities Intermediary and their affiliates may (without having to account therefor to the Company) accept deposits from, lend money to, make their investments in and generally engage in any kind of banking, trust or other business with the Purchase Contract Agent or the Securities Intermediary, as the case may be, any other Person interested herein and any Holder of Securities (and any of their respective subsidiaries or affiliates) as if it were not acting as the Collateral Agent or the Securities Intermediary, as the case may be, and the Collateral Agent, the Securities Intermediary and their affiliates may accept fees and other consideration from the Purchase Contract Agent and any Holder of Securities without having to account for the same to the Company; provided that each of the Securities Intermediary and the Collateral Agent covenants and agrees with the Company that it shall not accept, receive or permit there to be created in favor of itself and shall take no affirmative action to permit there to be created in favor of any other Person, any security interest, lien or other encumbrance of any kind in or upon the Collateral other than the lien created by the Pledge. Section 9.5 Non-Reliance on Collateral Agent and Securities Intermediary. ----------- ------------------------------------------------------------ Neither the Securities Intermediary nor the Collateral Agent shall be required to keep itself informed as to the performance or observance by the Purchase Contract Agent or any Holder of Securities of this Agreement, the Purchase Contract Agreement, the Securities or any other document referred to or provided for herein or therein or to inspect the properties or books of the Purchase Contract Agent or any Holder of Securities. Neither the Collateral Agent nor the Securities Intermediary shall have any duty or responsibility to provide the Company with any credit or other information concerning the affairs, financial condition or business of the Purchase Contract Agent or any Holder of Securities (or any of their respective affiliates) that may come into the possession of the Collateral Agent or the Securities Intermediary or any of their respective affiliates. Section 9.6 Compensation and Indemnity. ----------- -------------------------- The Company agrees to: (1) pay the Collateral Agent and the Securities Intermediary from time to time such compensation as shall be agreed in writing between the Company and the Collateral Agent or the Securities Intermediary, as the case may be, for all services rendered by them hereunder; and 24 (2) indemnify the Collateral Agent and the Securities Intermediary for, and to hold each of them harmless from and against, any loss, liability or reasonable out-of-pocket expense incurred without negligence, willful misconduct or bad faith on its part, arising out of or in connection with the acceptance or administration of its powers and duties under this Agreement, including the reasonable costs and expenses (including reasonable fees and expenses of counsel) of defending itself against any claim or liability in connection with the exercise or performance of such powers and duties. Section 9.7 Failure to Act. ----------- -------------- Subject to Section 9.2 of this Agreement, in the event of any ambiguity in the provisions of this Agreement or any dispute between or conflicting claims by or among the parties hereto or any other Person with respect to any funds or property deposited hereunder, the Collateral Agent and the Securities Intermediary shall be entitled, after prompt notice to the Company and the Purchase Contract Agent, at its sole option, to refuse to comply with any and all claims, demands or instructions with respect to such property or funds so long as such dispute or conflict shall continue, and the Collateral Agent and the Securities Intermediary shall not be or become liable in any way to any of the parties hereto for its failure or refusal to comply with such conflicting claims, demands or instructions. The Collateral Agent and the Securities Intermediary shall be entitled to refuse to act until either: (1) such conflicting or adverse claims or demands shall have been finally determined by a court of competent jurisdiction or settled by agreement between the conflicting parties as evidenced in a writing satisfactory to the Collateral Agent or the Securities Intermediary; or (2) the Collateral Agent or the Securities Intermediary shall have received security or an indemnity satisfactory to it sufficient to save it harmless from and against any and all loss, liability or reasonable out-of-pocket expense which it may incur by reason of its acting. The Collateral Agent and the Securities Intermediary may in addition elect to commence an interpleader action or seek other judicial relief or orders as the Collateral Agent or the Securities Intermediary may deem necessary. Notwithstanding anything contained herein to the contrary, neither the Collateral Agent nor the Securities Intermediary shall be required to take any action that is in its opinion contrary to law or to the terms of this Agreement, or which would in its opinion subject it or any of its officers, employees or directors to liability. Section 9.8 Resignation of Collateral Agent and Securities ----------- ---------------------------------------------- Intermediary. ------------ (a) Subject to the appointment and acceptance of a successor Collateral Agent as provided below: (1) the Collateral Agent may resign at any time by giving notice thereof to the Company and the Purchase Contract Agent as attorney-in-fact for the Holders of Securities and the Indenture Trustee; (2) the Collateral Agent may be removed at any time by the Company; and 25 (3) if the Collateral Agent fails to perform any of its material obligations hereunder in any material respect for a period of not less than 20 days after receiving written notice of such failure by the Purchase Contract Agent and such failure shall be continuing, the Collateral Agent may be removed by the Purchase Contract Agent. The Purchase Contract Agent shall promptly notify the Company of any removal of the Collateral Agent pursuant to clause (3) of the immediately preceding sentence. Upon any such resignation or removal, the Company shall have the right to appoint a successor Collateral Agent. If no successor Collateral Agent shall have been so appointed and shall have accepted such appointment within 30 days after the retiring Collateral Agent's giving of notice of resignation or such removal, then the retiring Collateral Agent may petition any court of competent jurisdiction for the appointment of a successor Collateral Agent. The Collateral Agent shall be a bank which has an office in New York, New York with a combined capital and surplus of at least $50,000,000 and shall not be the Purchase Contract Agent or any of its affiliates. Upon the acceptance of any appointment as Collateral Agent hereunder by a successor Collateral Agent, such successor Collateral Agent shall thereupon succeed to and become vested with all the rights, powers, privileges and duties of the retiring Collateral Agent, and the retiring Collateral Agent shall take all appropriate action to transfer any money and property held by it hereunder (including the Collateral) to such successor Collateral Agent. The retiring Collateral Agent shall, upon such succession, be discharged from its duties and obligations as Collateral Agent hereunder. After any retiring Collateral Agent's resignation hereunder as Collateral Agent, the provisions of this Section 9 shall continue in effect for its benefit in respect of any actions taken or omitted to be taken by it while it was acting as the Collateral Agent. Any resignation or removal of the Collateral Agent hereunder shall be deemed for all purposes of this Agreement as the simultaneous resignation or removal, as the case may be, of the Securities Intermediary. (b) Subject to the appointment and acceptance of a successor Securities Intermediary as provided below: (1) the Securities Intermediary may resign at any time by giving notice thereof to the Company and the Purchase Contract Agent as attorney-in-fact for the Holders of Securities and the Indenture Trustee; (2) the Securities Intermediary may be removed at any time by the Company; and (3) if the Securities Intermediary fails to perform any of its material obligations hereunder in any material respect for a period of not less than 20 days after receiving written notice of such failure by the Purchase Contract Agent and such failure shall be continuing, the Securities Intermediary may be removed by the Purchase Contract Agent. The Purchase Contract Agent shall promptly notify the Company of any removal of the Securities Intermediary pursuant to clause (3) of the immediately preceding sentence. Upon any such resignation or removal, the Company shall have the right to appoint a successor Securities Intermediary. If no successor Securities Intermediary shall have been so appointed and shall have accepted such appointment within 30 days after the retiring Securities Intermediary's giving of notice of resignation or such removal, then the retiring Securities Intermediary may petition any court of competent jurisdiction for the appointment of a successor Securities Intermediary. The Securities Intermediary shall be a bank which has an office in New York, New York with a 26 combined capital and surplus of at least $50,000,000 and shall not be the Purchase Contract Agent or any of its affiliates. Upon the acceptance of any appointment as Securities Intermediary hereunder by a successor Securities Intermediary, such successor Securities Intermediary shall thereupon succeed to and become vested with all the rights, powers, privileges and duties of the retiring Securities Intermediary, and the retiring Securities Intermediary shall take all appropriate action to transfer any money and property held by it hereunder (including the Collateral) to such successor Securities Intermediary. The retiring Securities Intermediary shall, upon such succession, be discharged from its duties and obligations as Securities Intermediary hereunder. After any retiring Securities Intermediary's resignation hereunder as Securities Intermediary, the provisions of this Section 9 shall continue in effect for its benefit in respect of any actions taken or omitted to be taken by it while it was acting as the Securities Intermediary. Section 9.9 Right to Appoint Agent or Advisor. ----------- -------------------------------- The Collateral Agent shall have the right to appoint agents or advisors in connection with any of its duties hereunder, and the Collateral Agent shall not be liable for any action taken or omitted by, or in reliance upon the advice of, such agents or advisors selected in good faith. The appointment of agents pursuant to this Section 9.9 shall be subject to prior consent of the Company, which consent shall not be unreasonably withheld. Section 9.10 Survival. ------------ -------- The provisions of this Section 9 shall survive termination of this Agreement and the resignation or removal of the Collateral Agent or the Securities Intermediary. Section 9.11 Exculpation. ------------ ----------- Anything contained in this Agreement to the contrary notwithstanding, in no event shall the Collateral Agent or the Securities Intermediary or their officers, directors, employees or agents be liable under this Agreement to any third party for indirect, special, punitive or consequential loss or damage of any kind whatsoever, including lost profits, whether or not the likelihood of such loss or damage was known to the Collateral Agent or the Securities Intermediary, or any of them, incurred without any act or deed that is found to be attributable to gross negligence or willful misconduct on the part of the Collateral Agent or the Securities Intermediary. Section 10 Amendment. --------- Section 10.1 Amendment Without Consent of Holders. ------------ ------------------------------------ Without the consent of any Holders, the Company (when authorized by a Board Resolution), the Collateral Agent, the Securities Intermediary and the Purchase Contract Agent, at any time and from time to time, may amend this Agreement, in form satisfactory to the Company, the Collateral Agent, the Securities Intermediary and the Purchase Contract Agent, to: (1) evidence the succession of another Person to the Company, and the assumption to by any such successor of the covenants of the Company; 27 (2) evidence and provide for the acceptance of appointment hereunder by a successor Collateral Agent, Securities Intermediary or Purchase Contract Agent; (3) add to the covenants of the Company for the benefit of the Holders, or to surrender any right or power herein conferred upon the Company, provided such covenants or such surrender do not adversely affect the validity, perfection or priority of the Pledge created hereunder; or (4) cure any ambiguity (or formal defect), to correct or supplement any provisions herein which may be inconsistent with any other such provisions herein, or to make any other provisions with respect to such matters or questions arising under this Agreement, provided such action shall not adversely affect the interests of the Holders. Section 10.2 Amendment with Consent of Holders. ------------ ---------------------------------- With the consent of the Holders of not less than a majority of the Purchase Contracts at the time outstanding, by Act of said Holders delivered to the Company, the Purchase Contract Agent, the Securities Intermediary and the Collateral Agent, the Company, when duly authorized by a Board Resolution, the Purchase Contract Agent, the Securities Intermediary and the Collateral Agent may amend this Agreement for the purpose of modifying in any manner the provisions of this Agreement or the rights of the Holders in respect of the Securities; provided, however, that no such supplemental agreement shall, without the unanimous consent of the Holders of each Outstanding Security adversely affected thereby, (1) change the amount or type of Collateral underlying a Security, impair the right of the Holder of any Security to receive distributions on the underlying Collateral or otherwise adversely affect the Holder's rights in or to such Collateral; (2) otherwise effect any action that would require the consent of the Holder of each Outstanding Security affected thereby pursuant to the Purchase Contract Agreement if such action were effected by an agreement supplemental thereto; or (3) reduce the percentage of Purchase Contracts the consent of whose Holders is required for any such amendment; provided that if any amendment or proposal referred to above would adversely affect only the Corporate Units or only the Treasury Units, then only the affected class of Holder as of the record date for the Holders entitled to vote thereon will be entitled to vote on such amendment or proposal, and such amendment or proposal shall not be effective except with the consent of Holders of not less than a majority of such class; provided, further, that the unanimous consent of the Holders of each outstanding Purchase Contract of such class affected thereby shall be required to approve any amendment or proposal specified in clauses (1) through (3) above. It shall not be necessary for any Act of Holders under this Section to approve the particular form of any proposed amendment, but it shall be sufficient if such Act shall approve the substance thereof. 28 Section 10.3 Execution of Amendments. ------------ ----------------------- In executing any amendment permitted by this Section, the Collateral Agent, the Securities Intermediary and the Purchase Contract Agent shall be entitled to receive and (subject to Section 7.1 of the Purchase Contract Agreement with respect to the Purchase Contract Agent) shall be fully protected in relying upon, an Opinion of Counsel stating that the execution of such amendment is authorized or permitted by this Agreement and that all conditions precedent, if any, to the execution and delivery of such amendment have been satisfied. Section 10.4 Effect of Amendments. ------------ -------------------- Upon the execution of any amendment under this Section, this Agreement shall be modified in accordance therewith, and such amendment shall form a part of this Agreement for all purposes; and every Holder of Certificates theretofore or thereafter authenticated, executed on behalf of the Holders and delivered under the Purchase Contract Agreement shall be bound thereby. Section 10.5 Reference to Amendments. ------------ ----------------------- Certificates authenticated, executed on behalf of the Holders and delivered after the execution of any amendment pursuant to this Section may, and shall if required by the Collateral Agent or the Purchase Contract Agent, bear a notation in form approved by the Purchase Contract Agent and the Collateral Agent as to any matter provided for in such amendment. If the Company shall so determine, new Security Certificates so modified as to conform, in the opinion of the Collateral Agent, the Purchase Contract Agent and the Company, to any such amendment may be prepared and executed by the Company and authenticated, executed on behalf of the Holders and delivered by the Purchase Contract Agent in accordance with the Purchase Contract Agreement in exchange for Outstanding Security Certificates. Section 11 Miscellaneous. ------------- Section 11.1 No Waiver. ------------ ---------- No failure on the part of the Collateral Agent or any of its agents to exercise, and no course of dealing with respect to, and no delay in exercising, any right, power or remedy hereunder shall operate as a waiver thereof; nor shall any single or partial exercise by the Collateral Agent or any of its agents of any right, power or remedy hereunder preclude any other or further exercise thereof or the exercise of any other right, power or remedy. The remedies herein are cumulative and are not exclusive of any remedies provided by law. Section 11.2 Governing Law. ------------ ------------- This agreement shall be governed by, and construed in accordance with, the laws of the State of New York. The Company, the Collateral Agent, the Securities Intermediary and the Holders from time to time of the Securities, acting through the Purchase Contract Agent as their attorney-in-fact, hereby submit to the nonexclusive jurisdiction of the United States District Court for the Southern District of New York and of any New York state court sitting in New York City 29 (subject to the acceptance of such jurisdiction by any such court) for the purposes of all legal proceedings arising out of or relating to this Agreement or the transactions contemplated hereby. The Company, the Collateral Agent, the Securities Intermediary and the Holders from time to time of the Securities, acting through the Purchase Contract Agent as their attorney-in-fact, irrevocably waive, to the fullest extent permitted by applicable law, any objection which they may now or hereafter have to the laying of the venue of any such proceeding brought in such a court and any claim that any such proceeding brought in such a court has been brought in an inconvenient forum. Section 11.3 Notices. ------------ ------- All notices, requests, consents and other communications provided for herein (including, without limitation, any modifications of, or waivers or consents under, this Agreement) shall be given or made in writing (including, without limitation, by telecopy) delivered to the intended recipient at the "Address for Notices" specified below its name on the signature pages hereof or, as to any party, at such other address as shall be designated by such party in a notice to the other parties. Except as otherwise provided in this Agreement, all such communications shall be deemed to have been duly given when transmitted by telecopier or personally delivered or, in the case of a mailed notice, upon receipt, in each case given or addressed as aforesaid. Section 11.4 Successors and Assigns. ------------ ---------------------- This Agreement shall be binding upon and inure to the benefit of the respective successors and assigns of the Company, the Collateral Agent, the Securities Intermediary and the Purchase Contract Agent, and the Holders from time to time of the Securities, by their acceptance of the same, shall be deemed to have agreed to be bound by the provisions hereof and to have ratified the agreements of, and the grant of the Pledge hereunder by, the Purchase Contract Agent. Section 11.5 Counterparts. ------------ ------------ This Agreement may be executed in any number of counterparts, all of which taken together shall constitute one and the same instrument, and any of the parties hereto may execute this Agreement by signing any such counterpart. Section 11.6 Severability. ------------ ------------ If any provision hereof is invalid and unenforceable in any jurisdiction, then, to the fullest extent permitted by law, (i) the other provisions hereof shall remain in full force and effect in such jurisdiction and shall be liberally construed in order to carry out the intentions of the parties hereto as nearly as may be possible and (ii) the invalidity or unenforceability of any provision hereof in any jurisdiction shall not affect the validity or enforceability of such provision in any other jurisdiction. Section 11.7 Expenses, etc. ------------ ------------- The Company agrees to reimburse the Collateral Agent and the Securities Intermediary for: 30 (1) all reasonable costs and expenses of the Collateral Agent and the Securities Intermediary (including, without limitation, the reasonable fees and expenses of counsel to the Collateral Agent and the Securities Intermediary), in connection with (i) the negotiation, preparation, execution and delivery or performance of this Agreement and (ii) any modification, supplement or waiver of any of the terms of this Agreement; (2) all reasonable costs and expenses of the Collateral Agent and the Securities Intermediary (including, without limitation, reasonable fees and expenses of counsel) in connection with (i) any enforcement or proceedings resulting or incurred in connection with causing any Holder of Securities to satisfy its obligations under the Purchase Contracts forming a part of the Securities and (ii) the enforcement of this Section 11.7; and (3) all transfer, stamp, documentary or other similar taxes, assessments or charges levied by any governmental or revenue authority in respect of this Agreement or any other document referred to herein and all costs, expenses, taxes, assessments and other charges incurred in connection with any filing, registration, recording or perfection of any security interest contemplated hereby. Section 11.8 Security Interest Absolute. ------------ -------------------------- All rights of the Collateral Agent and security interests hereunder, and all obligations of the Holders from time to time hereunder, shall be absolute and unconditional irrespective of: (1) any lack of validity or enforceability of any provision of the Purchase Contracts or the Securities or any other agreement or instrument relating thereto; (2) any change in the time, manner or place of payment of, or any other term of, or any increase in the amount of, all or any of the obligations of Holders of the Securities under the related Purchase Contracts, or any other amendment or waiver of any term of, or any consent to any departure from any requirement of, the Purchase Contract Agreement or any Purchase Contract or any other agreement or instrument relating thereto; or (3) any other circumstance which might otherwise constitute a defense available to, or discharge of, a borrower, a guarantor or a pledgor. 31 IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly executed as of the day and year first above written. DOMINION RESOURCES, INC. JPMORGAN CHASE BANK, not individually but solely as Purchase Contract Agent and as attorney-in-fact of the Holders from time to time of the Securities By: _____________________ Name: By: _____________________ Title: Name: Title: Address for Notices Address for Notices: 450 West 33/rd/ Street, 15/th/ Floor, New York, New York 10001 120 Tredegar Street Richmond, Virginia 23219 Attention: Institutional Trust Services Telecopy: (212)946-8159/8160 Attention: Treasurer Telecopy: (804)819-2211 BANK ONE TRUST COMPANY, BANK ONE TRUST COMPANY, N.A., N.A., as Collateral Agent as Securities Intermediary By: _____________________ By: _____________________ Name: Name: Title: Title: Address for Notices: Address for Notices: 153 West 51/st/ Street 153 West 51/st/ Street New York, New York 10019 New York, New York 10019 Attention: Corporate Trust Administration Attention: Corporate Trust Administration Telecopy: (212)373-1383 Telecopy: (212)373-1383
EXHIBIT A INSTRUCTION FROM PURCHASE CONTRACT AGENT TO COLLATERAL AGENT (Establishment of Treasury Units) BANK ONE TRUST COMPANY, N.A., as Collateral Agent 153 West 51/st/ Street New York, New York 10019 Attention: Corporate Trust Administration Telecopy: (212) 373-1383 Re: Upper DECS(SM) Equity Income Securities of Dominion Resources, Inc. (the "Company") Please refer to the Pledge Agreement dated as of March 20, 2002 (the "Pledge Agreement"), among the Company, you, as Collateral Agent, Bank One Trust Company, N.A., as Securities Intermediary, and the undersigned, as Purchase Contract Agent and as attorney-in-fact for the holders of Equity Income Securities from time to time. Capitalized terms used herein but not defined shall have the meaning set forth in the Pledge Agreement. We hereby notify you in accordance with Section 5.2 of the Pledge Agreement that the holder of securities named below (the "Holder") has elected to substitute $__________ Value of Treasury Securities in exchange for an equal Value of Pledged Senior Notes and has delivered to the undersigned a notice stating that the Holder has Transferred such Treasury Securities to the Securities Intermediary, for credit to the Collateral Account. We hereby request that you instruct the Securities Intermediary, upon confirmation that such Treasury Securities have been credited to the Collateral Account, to release to the undersigned an equal Value of Pledged Senior Notes in accordance with Section 5.2 of the Pledge Agreement. JPMORGAN CHASE BANK, as Purchase Contract Agent Date: _______________ By:_____________________________ Name: Title: Please print name and address of Holder electing to substitute Treasury Securities or security entitlements thereto for the Pledged Senior Notes: ________________________ ____________________________ Name Social Security or other Taxpayer Identification Number, if any ________________________ Address ________________________ ________________________ A-2 EXHIBIT B INSTRUCTION FROM COLLATERAL AGENT TO SECURITIES INTERMEDIARY (Establishment of Treasury Units) BANK ONE TRUST COMPANY, N.A., as Securities Intermediary 153 West 51/st/ Street New York, New York 10019 Attention: Corporate Trust Administration Telecopy: (212) 373-1383 Re: Upper DECS(SM) Equity Income Securities of Dominion Resources, Inc. (the "Company") Securities Account No. 6300018800 entitled "BANK ONE TRUST COMPANY, N.A., as Collateral Agent, DECS Securities Account (Dominion Resources, Inc.)" (the "Collateral Account") Please refer to the Pledge Agreement, dated as of March 20, 2002 (the "Pledge Agreement"), among the Company, you, as Securities Intermediary, JPMORGAN CHASE BANK, as Purchase Contract Agent and as attorney-in-fact for the holders of Equity Income Securities from time to time, and the undersigned, as Collateral Agent. Capitalized terms used herein but not defined shall have the meanings set forth in the Pledge Agreement. When you have confirmed that $__________ Value of Treasury Securities has been credited to the Collateral Account by or for the benefit of _________, as Holder of Equity Income Securities (the "Holder"), you are hereby instructed to release from the Collateral Account an equal Value of Senior Notes by Transfer to the Purchase Contract Agent. BANK ONE TRUST COMPANY, N.A., as Collateral Agent Date: _______________ By:_______________________________ Name: Title: Please print name and address of Holder: ________________________ ____________________________ Name Social Security or other Taxpayer Identification Number, if any ________________________ Address ________________________ ________________________ B-2 EXHIBIT C INSTRUCTION FROM PURCHASE CONTRACT AGENT TO COLLATERAL AGENT (Reestablishment of Corporate Units) BANK ONE TRUST COMPANY, N.A., as Collateral Agent 153 West 51/st/ Street New York, New York 10019 Attention: Corporate Trust Administration Telecopy: (212) 373-1383 Re: Upper DECS(SM) Equity Income Securities of Dominion Resources, Inc. (the "Company") Please refer to the Pledge Agreement, dated as of March 20, 2002 (the "Pledge Agreement"), among the Company, you, as Collateral Agent, Bank One Trust Company, N.A., as Securities Intermediary, and the undersigned, as Purchase Contract Agent and as attorney-in-fact for the holders of Equity Income Securities from time to time. Capitalized terms used herein but not defined shall have the meanings set forth in the Pledge Agreement. We hereby notify you in accordance with Section 5.3(a) of the Pledge Agreement that the holder of securities listed below (the "Holder") has elected to substitute $__________ Value of Senior Notes or security entitlements thereto in exchange for $__________ Value of Pledged Treasury Securities and has delivered to the undersigned a notice stating that the Holder has Transferred such Senior Notes or security entitlements thereto to the Securities Intermediary, for credit to the Collateral Account. We hereby request that you instruct the Securities Intermediary, upon confirmation that such Senior Notes or security entitlements thereto have been credited to the Collateral Account, to release to the undersigned $__________ Value of Treasury Securities or security entitlements thereto related to _____ Treasury Units of such Holder in accordance with Section 5.3(a) of the Pledge Agreement. JPMORGAN CHASE BANK, as Purchase Contract Agent Date: _______________ By:______________________________ Name: Title: Please print name and address of Holder electing to substitute Pledged Senior Notes or security entitlements thereto for Pledged Treasury Securities: ________________________ ____________________________ Name Social Security or other Taxpayer Identification Number, if any ________________________ Address ________________________ ________________________ C-2 EXHIBIT D INSTRUCTION FROM COLLATERAL AGENT TO SECURITIES INTERMEDIARY (Reestablishment of Corporate Units) BANK ONE TRUST COMPANY, N.A., as Securities Intermediary 153 West 51/st/ Street New York, New York 10019 Attention: Corporate Trust Administration Telecopy: (212) 373-1383 Re: Upper DECS(SM) Equity Income Securities of Dominion Resources, Inc. (the "Company") Securities Account No. 6300018800 entitled "BANK ONE TRUST COMPANY, N.A., as Collateral Agent, DECS Securities Account (Dominion Resources, Inc.)" (the "Collateral Account") Please refer to the Pledge Agreement, dated as of March 20, 2002 (the "Pledge Agreement"), among the Company, you, as Securities Intermediary, JPMORGAN CHASE BANK, as Purchase Contract Agent and as attorney-in-fact for the holders of Equity Income Securities from time to time, and the undersigned, as Collateral Agent. Capitalized terms used herein but not defined shall have the meanings set forth in the Pledge Agreement. When you have confirmed that $_________ Value of Senior Notes or security entitlements thereto has been credited to the Collateral Account by or for the benefit of _________, as Holder of Equity Income Securities (the "Holder"), you are hereby instructed to release from the Collateral Account $__________ Value of Treasury Securities or security entitlements thereto by Transfer to the Purchase Contract Agent. BANK ONE TRUST COMPANY, N.A., as Collateral Agent Date: _______________ By:______________________________ Name: Title: Please print name and address of Holder: ________________________ ____________________________ Name Social Security or other Taxpayer Identification Number, if any ________________________ Address ________________________ ________________________ D-2 EXHIBIT E NOTICE OF CASH SETTLEMENT FROM SECURITIES INTERMEDIARY TO PURCHASE CONTRACT AGENT (Cash Settlement Amounts) JPMORGAN CHASE BANK, as Purchase Contract Agent 450 West 33/rd/ Street, 15/th/ Floor New York, New York 10019 Attention: Institutional Trust Services Telecopy: (212) 946-8159/8160 Re: Upper DECS(SM) Equity Income Securities of Dominion Resources, Inc. (the "Company") Please refer to the Pledge Agreement, dated as of March 20, 2002 (the "Pledge Agreement"), among you, the Company, Bank One Trust Company, N.A., as Collateral Agent and the undersigned, as Securities Intermediary. Unless otherwise defined herein, terms defined in the Pledge Agreement are used herein as defined therein In accordance with Section [5.5(d)] [5.5(e)] of the Pledge Agreement, we hereby notify you that as of 11:00 a.m., [on the fifth Business Day immediately preceding the Purchase Contract Settlement Date] [on the Business Day immediately preceding the Purchase Contract Settlement Date], we have received [$_____ in immediately available funds paid in an aggregate amount equal to the Purchase Price to the Company on the Purchase Contract Settlement Date with respect to __________ Corporate Units] [$_________ in immediately available funds paid in an aggregate amount equal to the Purchase Price to the Company on the Purchase Contract Settlement Date with respect to ______ Treasury Units.] BANK ONE TRUST COMPANY, N.A., as Securities Intermediary Date: _______________ By:_________________________________ Name: Title: EX-4.5 7 dex45.txt FORM OR REMARKETING AGREEMENT Exhibit 4.5 ================================================================================ DOMINION RESOURCES, INC. and SALOMON SMITH BARNEY INC. _____________________ REMARKETING AGREEMENT Dated as of March 20, 2002 ================================================================================ TABLE OF CONTENTS
Page Section 1. Definitions. ........................................................ 1 Section 2. Appointment and Obligations of the Remarketing Agent. ............... 3 Section 3. Representations, Warranties and Agreements of the Company. .......... 7 Section 4. Officers' Certificates. ............................................. 9 Section 5. Fees and Expenses. .................................................. 10 Section 6. Further Agreements of the Company. .................................. 10 Section 7. Conditions to the Remarketing Agent's Obligations. .................. 12 Section 8. Indemnification. .................................................... 18 Section 9. Contribution. ....................................................... 20 Section 10. Resignation and Removal of the Remarketing Agent. ................... 21 Section 11. Dealing in the Remarketing Senior Notes. ............................ 21 Section 12. Remarketing Agent's Performance; Duty of Care. ...................... 21 Section 13. Termination. ........................................................ 22 Section 14. Notices. ............................................................ 22 Section 15. Persons Entitled to Benefit of Agreement. ........................... 22 Section 16. Survival. ........................................................... 23 Section 17. Governing Law. ...................................................... 23 Section 18. Counterparts. ....................................................... 23 Section 19. Headings. ........................................................... 23
DOMINION RESOURCES, INC. 2002 Series A 5.75% Senior Notes, due May 15, 2008 REMARKETING AGREEMENT March 20, 2002 Salomon Smith Barney Inc. 388 Greenwich Street, 34/th/ Floor New York, NY 10013 Ladies and Gentlemen: Salomon Smith Barney, Inc. is undertaking to remarket the 2002 Series A 5.75% Senior Notes, due May 15, 2008 (the "Senior Notes"), issued by Dominion Resources, Inc., a Virginia corporation (the "Company"), pursuant to the Indenture, dated as of June 1, 2000, between the Company and JPMorgan Chase Bank (formerly known as The Chase Manhattan Bank), as Trustee (the "Indenture Trustee"), as amended and supplemented by the Tenth Supplemental Indenture, dated March 1, 2002 (as amended and supplemented, the "Supplemental Indenture"). The Remarketing of the Senior Notes is provided for in the Supplemental Indenture, the Purchase Agreement and the Pledge Agreement. Section 1. Definitions. (a) Capitalized terms used and not defined in this Agreement shall have the meanings set forth in the Purchase Contract Agreement, dated as of March 20, 2002 (the "Purchase Contract Agreement"), between the Company and JPMorgan Chase Bank, as Purchase Contract Agent (the "Purchase Contract Agent), in the Indenture or in the Supplemental Indenture. (b) As used in this Agreement, in addition to the terms defined in the opening paragraph and in Section 1(a), the following terms have the following meanings: "Agreement" means this Remarketing Agreement, as amended or supplemented from time to time; "Principal Amount" means the principal amount of a Senior Note, or $50; 2 "Remarketing Senior Notes" means collectively (1) the Pledged Senior Notes and (2) the Separated Senior Notes of holders that have elected to participate in the Remarketing pursuant to Section 106 of the Supplemental Indenture and Section 5.7 of the Pledge Agreement, in each case as identified to the Remarketing Agent by the Purchase Contract Agent (with respect to the Pledged Senior Notes to be remarketed) and the Collateral Agent (with respect to the Separated Senior Notes to be remarketed) by 11:00 a.m. (New York City time) on the Business Day preceding the Initial Remarketing Date or, if applicable, any Subsequent Remarketing Dates or the Final Remarketing Date. "Remarketing Procedures" means the procedures in connection with the Remarketing of the Senior Notes described in the Supplemental Indenture, the Purchase Contract Agreement, the Pledge Agreement and this Agreement; and "Subsidiary" and "Significant Subsidiary" have the meanings set forth in Rule 405 under the Securities Act. The terms set forth below have the meanings given them in the referenced sections of this Agreement: Term Section ---- ------- Depositary Participant 2(e) Effective Date 3(b) Effective Time 3(b) Failed Remarketing 2(f) Final Remarketing 2(d) Final Remarketing Date 2(d) Initial Remarketing 2(c) Initial Remarketing Date 2(c) Material Adverse Effect 3(f) Preliminary Prospectus 3(b) Prospectus 3(b) Remarketing Agent 2(a) Remarketing Date 2(e) Remarketing Materials 3(b) 3 Remarketing Settlement Date 2(e) Rules and Regulations 3(b) Securities Act 3(b) Subsequent Remarketing 2(d) Subsequent Remarketing Date 2(d) Successful Initial Remarketing 2(e) Successful Final Remarketing 2(e) Successful Remarketing 2(e) Successful Subsequent Remarketing 2(e) Transactions 3(h) Section 2. Appointment and Obligations of the Remarketing Agent. (a) The Company hereby appoints Salomon Smith Barney Inc. as exclusive remarketing agent (the "Remarketing Agent"), and Salomon Smith Barney Inc. hereby accepts appointment as Remarketing Agent, for the purpose of (1) Remarketing the Remarketing Senior Notes on behalf of the holders thereof and (2) performing such other duties as are assigned to the Remarketing Agent in the Remarketing Procedures, all in accordance with the Remarketing Procedures. (b) The Remarketing Agent agrees to (1) use commercially reasonable efforts to remarket the Remarketing Senior Notes tendered or deemed tendered to the Remarketing Agent in the Remarketing, (2) provide prompt notice of the Reset Rate as set forth in this Agreement and (3) carry out such other duties as are assigned to the Remarketing Agent in the Remarketing Procedures, all in accordance with the provisions of the Remarketing Procedures. (c) On February 15, 2006 (the "Initial Remarketing Date"), the Remarketing Agent shall use its commercially reasonable efforts to remarket (the "Initial Remarketing") the Remarketing Senior Notes at a price at least equal to the Remarketing Value pursuant to the Remarketing Procedures. If, as a result of such efforts, the Remarketing Agent determines that it will be able to remarket all of the Remarketing Senior Notes tendered or deemed tendered for purchase at a price at least equal to the Remarketing Value prior to 4:00 p.m. (New York City time) on the Initial Remarketing Date, the Remarketing Agent shall determine the Reset Rate that will enable it to remarket all Remarketing Senior Notes tendered or deemed tendered for Remarketing at an interest rate on the Initial Remarketing Date sufficient to allow the Remarketing to occur at a price equal to the Remarketing Value. (d) If, despite the commercially reasonable efforts described in the preceding paragraph, the Remarketing Agent cannot remarket the Remarketing Senior Notes on the Initial 4 Remarketing Date, the Remarketing Agent will continue to use its commercially reasonable efforts to remarket the Remarketing Senior Notes (i) on one or more subsequent occasions from the Initial Remarketing Date to, and including, the ninth Business Day preceding the Purchase Contract Settlement Date and (ii) if necessary, on the third Business Day preceding the Purchase Contract Settlement Date, and in connection therewith to determine the Reset Rate at an interest rate on the Remarketing Date, if any, sufficient to allow the Remarketing at a price equal to the Remarketing Value as set forth herein and (each such subsequent Remarketing up to and including the ninth Business Day preceding the Purchase Contract Settlement Date being referred to as a "Subsequent Remarketing" and each such date to be referred to as, a "Subsequent Remarketing Date"; and the Remarketing on the third Business Day preceding the Purchase Contract Settlement Date, being referred to as the "Final Remarketing" and such date to be referred to as, the "Final Remarketing Date;"), in each case in accordance with the Remarketing Procedures; provided, however, that, the Final Remarketing, if at all, must occur no later than on the third Business Day immediately preceding the Purchase Contract Settlement Date. (e) If the Initial Remarketing, any Subsequent Remarketing or the Final Remarketing is successful (respectively, a "Successful Initial Remarketing," a "Successful Subsequent Remarketing" or a "Successful Final Remarketing"; any of the foregoing, a "Successful Remarketing"; and the date of a Successful Remarketing, the "Remarketing Date"), then: (i) By approximately 4:30 p.m. (New York City time) on such Remarketing Date, (A) the Remarketing Agent shall advise by telephone the Company, the Purchase Contract Agent, the Collateral Agent, the Securities Intermediary, the Depositary and the Trustee, of the Reset Rate determined in the Remarketing, (B) the Remarketing Agent shall advise each purchaser of Senior Notes sold in the Remarketing or such purchaser's DTC participant (the "Depositary Participant") of the Reset Rate and the number of Senior Notes such purchaser is to purchase, and (C) the Remarketing Agent shall request each purchaser to give instructions to its Depositary Participant to pay the purchase price on the third Business Day after the Remarketing Date (the "Remarketing Settlement Date") in same day funds against delivery of the Remarketing Senior Notes purchased through the facilities of the Depositary. In accordance with the Depositary's normal procedures, on the Remarketing Settlement Date or the Purchase Contract Settlement Date, as applicable, the transactions described above with respect to Senior Notes remarketed in the Remarketing shall be executed through the Depositary, and the accounts of the respective Depositary Participants shall be debited and credited, respectively, and such Remarketing Senior Notes delivered by book-entry, as necessary to effect purchases and sales of such Remarketing Senior Notes; provided, however, that, the settlement procedures set forth herein, including provisions for payment by purchasers of the Remarketing Senior Notes in the Remarketing, shall be subject to modification to the extent required by the Depositary or if the book-entry system is no longer available for the Remarketing Senior Notes at the time of the Remarketing, to facilitate the remarketing of the Remarketing Senior Notes in certificated form and the Remarketing Agent may modify such settlement procedures in order to facilitate the settlement process. 5 (ii) Upon receipt of the proceeds from a Successful Remarketing, the Remarketing Agent shall: (A) deduct and retain for itself an amount equal to 0.25% of the Principal Amount of the Remarketing Senior Notes as a fee for the performance of its services as Remarketing Agent hereunder; (B) (I) if the Successful Remarketing occurs prior to the third Business Day preceding the Purchase Contract Settlement Date, use the remaining proceeds with respect to the Pledged Senior Notes from such Successful Remarketing to purchase the Treasury Portfolio, in open market transactions and/or at Treasury auctions, described in clauses (1)(i) and (2)(i) of the definition of Remarketing Value and deliver such Treasury Portfolio to the Collateral Agent on the Remarketing Settlement Date or as soon thereafter as is practicable, or (II) if such Successful Remarketing occurs on the Final Remarketing Date, remit to the Collateral Agent on the Remarketing Settlement Date the portion of the remaining proceeds with respect to the Pledged Senior Notes from such Successful Remarketing in an amount equal to the aggregate principal amount of such Senior Notes. (C) if any Separated Senior Notes were included in such Successful Remarketing, remit to the Collateral Agent for payment to the holders of such Separated Senior Notes the amounts specified in clauses 1(ii) and 2(ii) of the definition of Remarketing Value; and (D) remit any remaining balance of such proceeds after the application of such proceeds as set forth in clauses (A) through (C) above, if any, to the Purchase Contract Agent for the benefit of the Holders of the remarketed Pledged Senior Notes and to the Collateral Agent for the holders of any remarketed Separated Senior Notes, on a pro rata basis; provided, however, that if such Successful Remarketing is consummated after 4:30 p.m. (New York City time) on such Remarketing Date and, despite using its commercially reasonable efforts, the Remarketing Agent cannot cause the applications of the proceeds specified above to occur on the Remarketing Settlement Date, then the Remarketing Agent may make such applications and remittances on the next succeeding Business Day. The Remarketing Agent may, in its discretion, communicate with holders of the Senior Notes, and prospective purchasers of Remarketing Senior Notes in connection with its remarketing efforts in order to facilitate the remarketing and the intent and purpose of this Agreement despite the fact that such communication may not be expressly required herein. (f) If, by 4:00 p.m. (New York City time), on the ninth Business Day preceding the Purchase Contract Settlement Date, the Remarketing Agent, despite using its commercially reasonable efforts, has been and is unable to remarket all of the Remarketing Senior Notes tendered for purchase at a price equal to at least the Remarketing Value, the Remarketing Agent shall Transfer to the Collateral Agent, by the sixth Business Day preceding the Purchase Contract Settlement Date, the Pledged Senior Notes that that were to be remarketed in the Initial or Subsequent Remarketing, whereupon the Collateral Agent shall, for the benefit of the 6 Company, hold such Pledged Senior Notes, to secure the obligation of the related Holders of Corporate Units to purchase Common Stock under the related Purchase Contracts. (g) If, (1) by 4:00 p.m. (New York City time), on the Final Remarketing Date, the Remarketing Agent, despite using its commercially reasonable efforts, has been and is unable to remarket all of the Remarketing Senior Notes tendered for purchase at a price equal to at least the Remarketing Value, or (2) the Remarketing Agent has determined that the Remarketing may not be commenced or consummated as contemplated herein and by the Remarketing Procedures under applicable law, a failed Remarketing (a "Failed Remarketing") shall be deemed to have occurred. If a Failed Remarketing occurs, the Remarketing Agent and the Company, as applicable, shall take the following actions: (i) The Remarketing Agent shall notify by telephone the Company, the Purchase Contract Agent, the Collateral Agent and the Trustee, that a Failed Remarketing has occurred, whereupon the Company shall notify the Depositary, by telephone, that a Failed Remarketing has occurred. (ii) The Company shall cause a notice of the Failed Remarketing to be sent to the holders of all Senior Notes and to be published in an Authorized Newspaper in New York City, in each case, no later than the Business Day preceding Purchase Contract Settlement Date. (iii) The Remarketing Agent shall determine the Reset Rate that will be equal to the Two Year Benchmark Rate plus the Applicable Spread in accordance with Section 106 of the Supplemental Indenture. (iv) The Remarketing Agent shall remit the Pledged Senior Notes that were to be remarketed to the Purchase Contract Agent and the Separated Senior Notes that were to be remarketed to the Collateral Agent. (g) If there are no Pledged Senior Notes and no holders of Separated Senior Notes elect to participate in the Remarketing and deliver their Separated Senior Notes and a notice of such election to the Collateral Agent by the Election Date in accordance with the Supplemental Indenture, then: (i) the Remarketing Agent shall, in its sole discretion, determine the rate that, in its judgment, would have been established had a Remarketing been held on the Final Remarketing Date, and such rate shall be the Reset Rate; (ii) the Remarketing Agent shall advise by telephone the Company and the Trustee of such Reset Rate, whereupon the Company shall notify the Depositary in writing of such Reset Rate; and (iii) the Company shall cause a notice of such Reset Rate to be sent to the holders of all Senior Notes and to be published in an Authorized Newspaper in New York City, in each case, no later than the Business Day preceding the Purchase Contract Settlement Date. 7 Section 3. Representations, Warranties and Agreements of the Company. The Company represents, warrants and agrees (i) on and as of the date hereof, (ii) on and as of the date the Prospectus Supplement or other Remarketing Materials (each as defined in Section 3(b) below) are first distributed in connection with the Remarketing (the "Commencement Date"), and (iii) on and as the Initial Remarketing Date and, if applicable, any Subsequent Remarketing Date and the Final Remarketing Date that: (a) The conditions for use of Form S-3, as set forth in the General Instructions thereto, have been satisfied. (b) A registration statement on Form S-3 (File No. 333-55904) and an amendment or amendments thereto with respect to the initial offering of the Senior Notes has (i) been prepared by the Company in conformity with the requirements of the Securities Act of 1933, as amended (the "Securities Act"), and the rules and regulations (the "Rules and Regulations") of the Commission thereunder, (ii) been filed with the Commission under the Securities Act and (iii) become effective under the Securities Act; a registration statement on Form S-3, if required to be filed in connection with the Remarketing, also may be prepared by the Company in conformity with the requirements of the Securities Act and the Rules and Regulations and filed with the Commission under the Securities Act; and the Indenture has been qualified under the Trust Indenture Act. Copies of such registration statement or registration statements that have become effective, and the amendment or amendments to such registration statements, have been delivered by the Company to the Remarketing Agent, in the case of documents not electronically available through the Commission's EDGAR filing system and, in the case of documents that are so available, to the extent requested by the Remarketing Agent. As used in this Agreement, "Effective Time" means the date and time as of which the last of such registration statements that have become effective or may be filed, or the most recent post-effective amendment thereto, if any, was declared effective by the Commission; "Effective Date" means the date of the Effective Time of such last registration statement; "Preliminary Prospectus" means each prospectus relating to the Remarketing Senior Notes included in such last registration statement, or amendment thereto, before it became effective under the Securities Act and any prospectus relating to the Remarketing Senior Notes filed by the Company pursuant to Rule 424(a) of the Rules and Regulations; "Registration Statement" means such last registration statement, as amended at its Effective Time, including documents incorporated by reference therein at such time and, if applicable, all information contained in the final prospectus filed with the Commission pursuant to Rule 424(b) of the Rules and Regulations, including any information deemed to be part of such Registration Statement as of the Effective Time pursuant to paragraph (b) of Rule 430A of the Rules and Regulations; and "Prospectus" means each final prospectus relating to the Remarketing Senior Notes, as first filed pursuant to Rule 424(b) of the Rules and Regulations. 8 Reference made herein to any Preliminary Prospectus, the Prospectus or any other information furnished by the Company to the Remarketing Agent for distribution to investors in connection with the Remarketing (the "Remarketing Materials") shall be deemed to refer to and include any documents incorporated by reference therein pursuant to Item 12 of Form S-3 under the Securities Act as of the date of such Preliminary Prospectus or the Prospectus, as the case may be, or, in the case of Remarketing Materials, referred to as incorporated by reference therein, and any reference to any amendment or supplement to any Preliminary Prospectus, the Prospectus or the Remarketing Materials shall be deemed to refer to and include any document filed under the Exchange Act after the date of such Preliminary Prospectus or the Prospectus incorporated by reference therein pursuant to Item 12 of Form S-3 or, if so incorporated, the Remarketing Materials, as the case may be; and any reference to any amendment to the Registration Statement shall be deemed to include any annual report of the Company filed with the Commission pursuant to Section 13(a) or 15(d) of the Exchange Act after the Effective Time that is incorporated by reference in the Registration Statement. (c) The Commission has not issued an order preventing or suspending the use of the Registration Statement, any Preliminary Prospectus, the Prospectus or the Remarketing Materials. (d) The Registration Statement conforms (and the Prospectus and any further amendments or supplements to the Registration Statement or the Prospectus, when they become effective or are filed with the Commission, as the case may be, will conform) in all respects to the requirements of the Securities Act and the Rules and Regulations, and the Registration Statement, the Prospectus and the Remarketing Materials do not and will not, as of the Effective Date (as to the Registration Statement and any amendment thereto), as of the applicable filing date (as to the Prospectus and any amendment or supplement thereto) and as of the Commencement Date and the Remarketing Date (as to the Registration Statement, the Prospectus and any Remarketing Materials) contain any untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary to make the statements therein not misleading; provided that no representation and warranty is made as to the statement of eligibility and qualification on Form T-1 of the Indenture Trustee under the Trust Indenture Act, or as to information contained in or omitted from the Registration Statement, the Prospectus or the Remarketing Materials in reliance upon and in conformity with written information furnished to the Company by the Remarketing Agent specifically for inclusion therein; the Indenture conforms in all material respects to the requirements of the Trust Indenture Act and the applicable rules and regulations thereunder. (e) Deloitte & Touche LLP, who certified certain of the Company's financial statements incorporated by reference in the Registration Statement and the Prospectus (or any firm that subsequently serves as the Company's independent public accountants), are independent public accountants as required by the Securities Act and the Rules and Regulations. (f) Except as reflected in, or contemplated by, the Registration Statement, the Prospectus or the Remarketing Materials, since the respective most recent dates as of 9 which information is given in the Registration Statement, the Prospectus or any Remarketing Materials, there has not been any material adverse change or event which would result in a material adverse effect on the condition of the Company and its subsidiaries taken as a whole, financial or otherwise (a "Material Adverse Effect"). The Company and its subsidiaries, taken as a whole, have no material contingent financial obligation which is not disclosed in the Registration Statement, the Prospectus or the Remarketing Materials. (g) All of the issued and outstanding capital stock or membership interests of each Significant Subsidiary of the Company have been duly authorized and are validly issued, fully paid and nonassessable and, with the exception of the outstanding preferred stock of Virginia Electric and Power Company which is owned by third parties (or any stock owned by third parties of any Significant Subsidiary that the Company acquires after the date hereof), is owned by the Company, directly or through subsidiaries, free and clear of any security interest, mortgage, pledge, lien, claim, encumbrance or equitable right. (h) The execution, delivery and performance of this Agreement, the Indenture and the Senior Notes and any other agreement or instrument entered into or issued or to be entered into or issued by the Company in connection with the transactions contemplated hereby or thereby and the consummation of the transactions contemplated herein or therein (collectively, the "Transactions") and compliance by the Company with its obligations hereunder and thereunder do not and will not, whether with or without the giving of notice or lapse of time or both, conflict with or constitute a breach of, or default under or result in the creation or imposition of any lien, charge or encumbrance upon any property or assets of the Company or any subsidiary pursuant to any contract, indenture, mortgage, deed of trust, loan or credit agreement, note, lease or any other agreement or instrument, to which the Company or any subsidiary is a party or by which it or any of them may be bound, or to which any of the property or assets of the Company or any subsidiary is subject (except for such conflicts, breaches or defaults or liens, charges or encumbrances that would not have a Material Adverse Effect), nor will such action result in any violation of the provisions of the charter or bylaws of the Company or any subsidiary, or any applicable law, statute, rule, regulation, judgment, order, writ or decree of any government, government instrumentality or court, domestic or foreign, having jurisdiction over the Company or any subsidiary or any of their respective properties, assets or operations, and the Company has full power and authority to perform under this Agreement. (i) The Company is not an "investment company" or an entity "controlled" by an "investment company" as such terms are defined in the Investment Company Act of 1940, as amended. Section 4. Officers' Certificates. Any certificate signed by any officer of the Company or any of its subsidiaries and delivered to the Remarketing Agent or to counsel for the Remarketing Agent in connection with the Remarketing shall be deemed a representation and warranty by the Company to the Remarketing Agent as to the matters covered thereby on the date of such certificate. 10 Section 5. Fees and Expenses. (a) For the performance of its services as Remarketing Agent hereunder, the Remarketing Agent shall retain from the proceeds of the Remarketing a Remarketing Fee in accordance with Section 2(e)(ii)(A). (b) The Company agrees to pay: (1) the costs incident to the preparation and printing of the Registration Statement, Prospectus and any Remarketing Materials and any amendments or supplements thereto, including all related registration and filing fees; (2) the costs of distributing the Registration Statement, Prospectus and any Remarketing Materials and any amendments or supplements thereto; (3) The fees and expenses of qualifying the Remarketing Senior Notes under the securities laws of the several jurisdictions as provided in Section 6(f) and of preparing, printing and distributing a Blue Sky Memorandum (including related fees and expenses of counsel to the Remarketing Agent); (4) all other costs and expenses incident to the performance of the obligations of the Company hereunder, including the fees and expenses of the Company's counsel; and (5) the reasonable fees and expenses of outside counsel to the Remarketing Agent in connection with their duties hereunder. Section 6. Further Agreements of the Company. The Company covenants and agrees as follows: (a) (1) To prepare any registration statement or prospectus, if required, in connection with the Remarketing, in a form approved by the Remarketing Agent and to file any such prospectus pursuant to the Securities Act within the period required by the Rules and Regulations; (2) to advise the Remarketing Agent, promptly after it receives notice thereof, of the time when any amendment to the Registration Statement has been filed or becomes effective or any supplement to the Prospectus or any amended Prospectus has been filed, in each such case excluding documents filed under the Exchange Act incorporated by reference, and to furnish the Remarketing Agent with copies of such notice; (3) to file promptly all reports and any definitive proxy or information statements required to be filed by the Company with the Commission pursuant to Section 13(a), 13(c), 14 or 15(d) of the Exchange Act subsequent to the date of the Prospectus and for so long as the delivery of a prospectus is required in connection with the offering or sale of the Remarketing Senior Notes; 11 (4) to advise the Remarketing Agent, promptly after it receives notice thereof, of the issuance by the Commission of any stop order or of any order preventing or suspending the use of the Prospectus, of the suspension of the qualification of any of the Remarketing Senior Notes for offering or sale in any jurisdiction, of the initiation or threatening of any proceeding for any such purpose, or of any request by the Commission for the amending or supplementing of the Registration Statement or the Prospectus or for additional information; and, in the event of the issuance of any stop order or of any order preventing or suspending the use of any Prospectus or suspending any such qualification, to use promptly its best efforts to obtain its withdrawal. (b) To deliver promptly to the Remarketing Agent in New York City such number of the following documents as the Remarketing Agent shall request: (i) conformed copies of the Registration Statement as originally filed with the Commission and each amendment thereto (in each case excluding exhibits other than this Agreement and the Indenture), (ii) the Prospectus and any amended or supplemented Prospectus, (iii) any document incorporated by reference in the Prospectus (excluding exhibits thereto) and (iv) any Remarketing Materials; and, if the delivery of a prospectus is required at any time in connection with the Remarketing and if at such time any event shall have occurred as a result of which the Prospectus as then amended or supplemented would include any untrue statement of a material fact or omit to state any material fact necessary in order to make the statements therein, in the light of the circumstances under which they were made when such Prospectus is delivered, not misleading, or if for any other reason in the opinion of counsel to the Company or the Remarketing Agent it shall be necessary during such same period to amend or supplement the Registration Statement or Prospectus or to file under the Exchange Act any document incorporated by reference in the Prospectus in order to comply with the Securities Act or the Exchange Act, to notify the Remarketing Agent and to file such document and to prepare and furnish without charge to the Remarketing Agent and to any dealer in Senior Notes as many copies as the Remarketing Agent may from time to time request of an amended or supplemented Prospectus which will correct such statement or omission or effect such compliance. (c) To file promptly with the Commission any amendment to the Registration Statement or the Prospectus or any supplement to the Prospectus that may, in the judgment of the Company or the Remarketing Agent, be required by the Securities Act or requested by the Commission. (d) Prior to filing with the Commission (i) any amendment to the Registration Statement or supplement to the Prospectus (excluding documents filed under the Exchange Act incorporated by reference) or (ii) any Prospectus pursuant to Rule 424 of the Rules and Regulations, to furnish a copy thereof to the Remarketing Agent and counsel to the Remarketing Agent; and to afford them a reasonable opportunity to comment on any such amendment or supplement. (e) As soon as practicable after the Effective Date of the Registration Statement to make "generally available to the Company's security holders" and to deliver to the Remarketing Agent an "earnings statement" of the Company and its subsidiaries (which need not be audited) in reasonable detail, covering a period of at least 12 months 12 beginning within three months after the Effective Date of the Registration Statement, which earnings statement shall satisfy the requirements of Section 11(a) of the Securities Act. The terms "generally available to its security holders" and "earnings statement" shall have the meanings set forth in Rule 158 of the Rules and Regulations. (f) Promptly from time to time to take such action as the Remarketing Agent may reasonably request to qualify any of the Remarketing Senior Notes for offer and sale under the securities or "blue sky" laws of such jurisdictions as the Remarketing Agent may request and to comply with such laws so as to permit the continuance of sales and dealings therein in such jurisdictions for as long as may be necessary to complete the distribution of the Senior Notes; provided that in connection therewith, the Company shall not be required to qualify as a foreign corporation or to file a general consent to service of process in any jurisdiction in which it is not so qualified or to submit to any requirements which it deems unduly burdensome. Section 7. Conditions to the Remarketing Agent's Obligations. The obligations of the Remarketing Agent hereunder are subject to (i) the accuracy, on and as of the date when made, of the representations and warranties of the Company contained herein or in any Certificates of any officer of the Company or any subsidiary of the Company delivered pursuant hereto, (ii) the performance by the Company of its obligations hereunder and (iii) each of the following additional terms and conditions: (a) The Prospectus shall have been filed with the Commission pursuant to Section 6(a) hereof; no stop order suspending the effectiveness of the Registration Statement or any part thereof or suspending the qualification of the Indenture, shall have been issued and no proceeding for that purpose shall have been initiated or threatened by the Commission; and any request of the Commission for inclusion of additional information in the Registration Statement or the Prospectus or otherwise shall have been complied with. (b) The Remarketing Agent shall not have discovered and disclosed to the Company on or prior to the Remarketing Date that the Registration Statement, the Prospectus or the Remarketing Materials or any amendment or supplement thereto contains any untrue statement of a fact which, in the opinion of counsel to the Remarketing Agent, is material or omits to state any fact which, in the opinion of such counsel, is material and is required to be stated therein or is necessary to make the statements therein not misleading and the Company shall not have filed an amendment or supplement to the Registration Statement or otherwise acted to correct the matter so disclosed. (c) Counsel to the Company shall have furnished to the Remarketing Agent its written opinion, addressed to the Remarketing Agent and dated the Initial Remarketing Date and, if applicable, any Subsequent Remarketing Date and the Final Remarketing Date, in form and substance satisfactory to the Remarketing Agent, to the effect that: 13 (i) No filing with, or authorization, approval, consent, license, order, registration, qualification or decree of, any court or governmental authority or agency, domestic or foreign (other than those required under the Public Utility Holding Company Act of 1935, as amended, the Securities Act and the Rules and Regulations, which have been obtained, or as may be required under the securities or blue sky laws of the various states) is necessary or required in connection with the due authorization, execution, delivery or performance of the Indenture, the Senior Notes and this Agreement by the Company or for the Remarketing of the Senior Notes. An appropriate order of the Commission with respect to the sale of the Corporate Units, of which the Senior Notes are a part, under the Public Utility Holding Company Act of 1935, as amended (if required), has been issued, and such order remains in effect at this date. (ii) The Indenture has been duly authorized, executed and delivered by, has been duly qualified under the Trust Indenture Act and constitutes a valid and binding obligation of, the Company, enforceable against the Company in accordance with its terms, subject to the effects of bankruptcy, insolvency, fraudulent conveyance, reorganization, moratorium and other similar laws relating to or affecting creditors' rights generally, general equitable principles (whether considered in a proceeding in equity or at law) and an implied covenant of good faith and fair dealing. (iii) The Senior Notes have been duly authorized, executed, issued and delivered by the Company and constitute valid and binding obligations of the Company entitled to the benefits of the Indenture, enforceable in accordance with their terms, subject to the effects of bankruptcy, insolvency, fraudulent conveyance, reorganization, moratorium and other similar laws relating to or affecting creditors' rights generally, general equitable principles (whether considered in a proceeding in equity or at law) and an implied covenant of good faith and fair dealing. (iv) The Remarketing Senior Notes and the Remarketing Agreement, when the Remarketing Senior Notes are remarketed pursuant to this Agreement, will conform to the descriptions thereof contained in the Prospectus and in any Remarketing Materials, and the Indenture is in substantially the form filed as an exhibit to the Registration Statement. (v) The Registration Statement was declared effective under the Securities Act, and the Indenture was qualified under the Trust Indenture Act, as of the date and time specified in such opinion, the Prospectus was filed with the Commission pursuant to the subparagraph of Rule 424(b) of the Rules and Regulations specified in such opinion on the date specified therein and, to the knowledge of such counsel, no stop order suspending the effectiveness of the Registration Statement has been issued and no proceeding for that purpose is pending or threatened by the Commission. 14 (vi) The Registration Statement and the Prospectus appear on their face to be appropriately responsive in all material respects to the requirements of the Securities Act and the Rules and Regulations (except that such counsel need express no comment or belief with respect to the financial statements and schedules and other financial or statistical information contained in the Registration Statement or Prospectus). (vii) The statements contained in the Prospectus under the captions "Description of Debt Securities," "Additional Terms of Senior Debt Securities," and "Description of the Senior Notes," insofar as they purport to constitute summaries of certain terms of documents referred to therein, constitute accurate summaries of the terms of such documents in all material respects. (viii) Based upon current law and the assumptions stated or referred to therein, the statements relating to the Remarketing Senior Notes set forth in the Prospectus or in the Remarketing Materials under the caption "United States Federal Income Tax Consequences," insofar as they purport to constitute summaries of matters of United States federal tax laws and regulations or legal conclusions with respect thereto, constitute accurate summaries of the matters described therein in all material respects. In rendering such opinion, such counsel may state that its opinion is limited to matters governed by the Federal laws of the United States of America and the laws of the Commonwealth of Virginia and the State of New York. Such counsel shall also advise the Remarketing Agent that although such counsel is not passing upon and assumes no responsibility or liability for the accuracy, completeness or fairness of the statements contained in the documents incorporated by reference in the Prospectus or any further amendment or supplement thereto made by the Company prior to such Remarketing Date, they have no reason to believe that any of such documents (other than the financial statements and related schedules therein, as to which such counsel need express no opinion), when such documents became effective or were filed with the Commission, as the case may be, contained, in the case of a registration statement which became effective under the Securities Act, an untrue statement of a material fact or omitted to state a material fact required to be stated therein necessary to make the statements therein not misleading, or, in the case of other documents which were filed under the Securities Act or the Exchange Act with the Commission, an untrue statement of a material fact or omitted to state a material fact necessary in order to make the statements therein, in light of the circumstances under which they were made when such documents were so filed, not misleading. Such counsel shall also advise the Remarketing Agent that although such counsel is not passing upon and, except as set forth in clauses (vii) and (viii) above, assumes no responsibility or liability for the accuracy, completeness or fairness of the statements contained in the Registration Statement, the Prospectus and the Remarketing Materials and any further amendments and supplements thereto made by the Company prior to such date, such counsel has no reason to believe that, as of its effective date, the Registration Statement or any further amendment thereto made by the Company prior to such date (other than the financial statements and related schedules therein, as to which such counsel need express no opinion) contained an untrue statement of a material fact or 15 omitted to state a material fact required to be stated therein or necessary to make the statements therein not misleading or that, as of its date, the Prospectus and the Remarketing Materials or any further amendment or supplement thereto made by the Company prior to such Remarketing Date (other than the financial statements and related schedules therein, as to which such counsel need express no opinion) contained an untrue statement of a material fact or omitted to state a material fact necessary to make the statements therein, in light of the circumstances under which they were made, not misleading or that, as of the Commencement Date, the Remarketing Date and the Purchase Contract Settlement Date, either the Registration Statement, the Prospectus or the Remarketing Materials or any further amendment or supplement thereto made by the Company prior to such Remarketing Date (other than the financial statements and related schedules therein, as to which such counsel need express no opinion) contains an untrue statement of a material fact or omits to state a material fact necessary to make the statements therein, in light of the circumstances under which they were made, not misleading. Such counsel may state that its opinion is given on the basis that any statement contained in a document incorporated by reference in the Prospectus or any further amendment or supplement thereto shall be deemed not to be contained in the Registration Statement or Prospectus if the statement has been modified or superseded by any statement in a subsequently filed document incorporated by reference in the Prospectus or any further amendment or supplement thereto or in the Registration Statement or Prospectus. (d) The General Counsel of the Company shall have furnished to the Remarketing Agent a written opinion, addressed to the Remarketing Agent and dated the Initial Remarketing Date and, if applicable, any Subsequent Remarketing Date and the Final Remarketing Date, in form and substance satisfactory to the Remarketing Agent, to the effect that: (i) The Company has been duly incorporated and is validly existing as a corporation in good standing under the laws of the Commonwealth of Virginia and has the corporate power and authority to own, lease and operate its properties and to conduct its business as described in Prospectus and in any Remarketing Materials and to enter into and perform its obligations under this Agreement and the Indenture. The Company is duly qualified as a foreign corporation to transact business and is in good standing in each other jurisdiction in which such qualification is required, whether by reason of the ownership or leasing of property or the conduct of business, except where the failure to so qualify or be in good standing would not result in a Material Adverse Effect. (ii) Each Significant Subsidiary of the Company has been duly organized and is validly existing in good standing under the laws of the jurisdiction of its organization, has the power and authority to own, lease and operate its properties and to conduct its business as described in the Prospectus and in any Remarketing Materials and is duly qualified to transact business and is in good standing in each jurisdiction in which such qualification is required, whether by reason of the ownership or leasing of property or the conduct of 16 business, except where the failure to so qualify or be in good standing would not result in a Material Adverse Effect. (iii) This Agreement has been duly authorized, executed and delivered by the Company. (iv) There are no actions, suits or proceedings pending or, to the best of such counsel's knowledge, threatened, to which the Company or any of its subsidiaries is a party or to which any of the properties of the Company or any of its subsidiaries is subject, other than (A) as described in the Prospectus or in any Remarketing Materials and (B) actions, suits or proceedings which such counsel believes are not likely to have a material adverse effect on the power or ability of the Company to perform its obligations under this Agreement or to consummate the Transactions. (e) On the Initial Remarketing Date and, if applicable, any Subsequent Remarketing Date and the Final Remarketing Date, the Company shall have furnished to the Remarketing Agent a letter addressed to the Remarketing Agent and dated such date, in form and substance satisfactory to the Remarketing Agent, of the Company's independent public accountants, containing statements and information of the type ordinarily included in accountants' "comfort letters" with respect to certain financial information contained in the Prospectus and in the Remarketing Materials. (f) The Company shall have furnished to the Remarketing Agent a certificate, dated the Initial Remarketing Date and, if applicable, any Subsequent Remarketing Date and the Final Remarketing Date, of its President or any Vice President, stating that: (i) the representations, warranties and agreements of the Company contained in this Agreement are true and correct as of the Remarketing Date, and the Company performed all obligations and satisfied all conditions required of it under this Agreement; and (ii) no stop order suspending the effectiveness of the Registration Statement is in effect and no proceedings for such purpose are pending before, or to such officer's knowledge, threatened by the Commission on the date hereof. (g) Subsequent to fifteen Business Days prior to the Remarketing Date and prior to the Remarketing on the Remarketing Date, except as reflected in, or contemplated by, the Registration Statement, the Prospectus and the Remarketing Materials, there shall not have occurred: (i) any change in the common stock or long-term debt of the Company (other than a decrease in the aggregate principal amount of such debt outstanding); (ii) any material adverse change in the general affairs, financial condition or earnings of the Company and its subsidiaries taken as a whole; or 17 (iii) any material transaction entered into by the Company or a Significant Subsidiary other than a transaction in the ordinary course of business, the effect of which, in any such case described in clause (i), (ii) or (iii), is, in the reasonable judgment of the Remarketing Agent, so material and so adverse as to make it impracticable to proceed with the Remarketing on the terms and in the manner contemplated in the Prospectus, the Remarketing Materials and this Agreement. (h) Subsequent to fifteen Business Days prior to the Remarketing Date and prior to the Remarketing on the Remarketing Date, there shall not have occurred any of the following: (i) a downgrading in the rating accorded the Company's senior unsecured notes, or securities that are pari passu to the Company's senior unsecured notes, by any "nationally recognized statistical rating organization" (as that term is defined by the Commission for purposes of Rule 436(g)(2) under the Securities Act) or any public announcement by any such organization that it has under surveillance or review, with possible negative implications, its rating of such securities; (ii) any general suspension of trading in securities on the New York Stock Exchange or any limitation on prices for such trading or any restriction on the distribution of securities established by the New York Stock Exchange or by the Commission or by any federal or state agency or by the decision of any court; (iii) a suspension of trading of any securities of the Company on the New York Stock Exchange; (iv) a banking moratorium shall have been declared by federal or New York state authorities; or (v) any outbreak or escalation of major hostilities in which the United States is involved, any declaration of war by the United States Congress or any other substantial national or international calamity or crisis resulting in the declaration of a national emergency, or any material adverse change in the financial markets, the effect of which outbreak, escalation, declaration, calamity, crisis or material adverse change, in the reasonable judgment of the Remarketing Agent, makes it impracticable to proceed with the Remarketing on the terms and in the manner contemplated in the Prospectus, the Remarketing Materials and this Agreement. (i) Without the prior written consent of the Remarketing Agent, the Indenture shall not have been amended in any manner, or otherwise contain any provision not contained therein as of the date hereof that, in the reasonable judgment of the Remarketing Agent, materially changes the nature of the Remarketing Senior Notes or the Remarketing Procedures. The foregoing shall not require notice to, or the obtaining 18 of consent from, the Remarketing Agent with respect to any amendment or change in the Indenture that does not materially change the nature of the Remarketing Senior Notes or the Remarketing Procedures. (j) All corporate proceedings and other legal matters incident to the authorization, form and validity of this Agreement, the Indenture, the Remarketing Senior Notes, the Prospectus, the Registration Statement, the Remarketing Materials and all other legal matters relating to this Agreement and the transactions contemplated hereby shall be reasonably satisfactory in all material respects to counsel to the Remarketing Agent, and the Company shall have furnished to such counsel all documents and information that they may reasonably request to enable them to pass upon such matters. All opinions, letters, evidence and certificates mentioned above or elsewhere in this Agreement shall be deemed to be in compliance with the provisions hereof only if they are in form and substance reasonably satisfactory to counsel for the Remarketing Agent. Section 8. Indemnification. (a) The Company agrees to indemnify and hold harmless the Remarketing Agent and each person who controls the Remarketing Agent within the meaning of Section 15 of the Securities Act or Section 20(a) of the Exchange Act, from and against any and all losses, claims, damages or liabilities, joint or several, or any actions in respect thereof, to which the Remarketing Agent or any such controlling person may become subject, under the Securities Act, the Exchange Act or any other statute or common law and to reimburse the Remarketing Agent and any such controlling person for any legal or other expenses (including, to the extent hereinafter provided, reasonable outside counsel fees) incurred by the Remarketing Agent or any such controlling person in connection with investigation or defending any such losses, claims, damages or liabilities or in connection with defending any actions, insofar as such losses, claims, damages, liabilities, expenses or actions arise out of, or are based upon (i) any untrue statement or alleged untrue statement of a material fact contained in (A) the Registration Statement or the Prospectus or in any amendment or supplement thereto (if any amendments or supplements thereto shall have been furnished) (B) any Preliminary Prospectus (if and when used prior to the Effective Date) or (C) any Remarketing Materials, or (ii) the omission or alleged omission to state therein any material fact required to be stated therein or necessary to make the statements therein not misleading; provided, however, that the foregoing agreement, insofar as it relates to any Preliminary Prospectus, shall not inure to the benefit of the Remarketing Agent (or to the benefit of any such controlling person) on account of any losses, claims, damages, liabilities or actions arising out of the sale of the Remarketing Senior Notes to any person by the Remarketing Agent if it shall be established that a copy of the Prospectus, excluding any documents incorporated by reference (as supplemented or amended, if the Company shall have made any supplements or amendments which have been furnished to the Remarketing Agent), shall not have been sent or given by or on behalf of the Remarketing Agent to such person at or prior to the written confirmation of the sale to such person in any case where such delivery is required by the Securities Act and the Company satisfied its obligations pursuant to Section 6(b), if the misstatement or omission leading to such loss, claim, damage, liability or action was corrected in the Prospectus (excluding any documents incorporated by reference) as amended or supplemented, and such correction would have cured the defect giving rise to such loss, claim, damage, liability or action; 19 and provided further that the indemnity agreement of the Company contained in this Section 8(a) shall not apply to any such losses, claims, damages, liabilities, expenses or actions arising out of, or based upon, any such untrue statement or alleged untrue statement or omission or alleged omission if such statement or omission was made in reliance upon information furnished herein or otherwise in writing to the Company by or on behalf of the Remarketing Agent for use therein. The indemnity agreement of the Company contained in this Section 8(a) and the representations and warranties of the Company contained in or made pursuant to Sections 3 and 4 shall remain operative and in full force and effect, regardless of any investigation made by or on behalf of the Remarketing Agent or any such controlling person, and shall survive the Remarketing of the Remarketing Senior Notes. (b) The Remarketing Agent agrees to indemnify and hold harmless the Company, its officers and directors and each person who controls the Company within the meaning of Section 15 of the Securities Act or Section 20(a) of the Exchange Act, from and against any and all losses, claims, damages or liabilities, joint or several, or any actions in respect thereof, to which they or any of them may become subject, under the Securities Act, the Exchange Act or any other statute or common law and to reimburse each of them for any legal or other expenses (including, to the extent hereinafter provided, reasonable outside counsel fees) incurred by them in connection with investigation or defending any such losses, claims, damages or liabilities or in connection with defending any actions, insofar as such losses, claims, damages, liabilities, expenses or actions arise out of, or are based upon, (i) any untrue statement or alleged untrue statement of a material fact contained in (A) the Registration Statement or the Prospectus or in any amendment or supplement thereto (if any amendments or supplements thereto shall have been furnished) (B) any Preliminary Prospectus (if and when used prior to the Effective Date) or (C) any Remarketing Materials, or (ii) the omission or alleged omission to state therein any material fact required to be stated therein or necessary to make the statements therein not misleading, if such statement or omission was made in reliance upon information furnished herein or in writing to the Company by or on behalf of the Remarketing Agent for use therein. The indemnity agreement of the Remarketing Agent contained in this Section 8(b) shall remain operative and in full force and effect, regardless of any investigation made by or on behalf of the Company or any such controlling person, and shall survive the Remarketing of the Remarketing Senior Notes. (c) Upon the receipt of notice of the commencement of any action against the Company or any of its officers or directors or any person controlling the Company or the Remarketing Agent or any person controlling the Remarketing Agent as aforesaid, in respect of which indemnity may be sought on account of any indemnity agreement contained herein, it will promptly give written notice of the commencement thereof to the party or parties against whom indemnity shall be sought hereunder, but the omission so to notify such indemnifying party or parties of any such action shall not relieve such indemnifying party or parties from any liability which it or they may have to the indemnified party otherwise than on account of such indemnity agreement. In case such notice of any such action shall be so given, such indemnifying party shall be entitled to participate at its own expense in the defense or, if it so elects, to assume (in conjunction with any other indemnifying parties) the defense of such action, in which event such defense shall be conducted by counsel chosen by such indemnifying party (or parties) and satisfactory to the indemnified party or parties who shall be defendant or defendants in such action, and such defendant or defendants shall bear the fees and expenses of any additional 20 outside counsel retained by them; provided that, if the defendants (including impleaded parties) in any such action include both the indemnified party and the indemnifying party (or parties) and the indemnified party shall have reasonably concluded that there may be legal defenses available to it and/or other indemnified parties which are different from or additional to those available to the indemnifying party (or parties), the indemnified party shall have the right to select separate counsel to assert such legal defenses and to participate otherwise in the defense of such action on behalf of such indemnified party. The indemnifying party shall bear the reasonable fees and expenses of outside counsel retained by the indemnified party if (i) the indemnified party shall have retained such counsel in connection with the assertion of legal defenses in accordance with the proviso to the preceding sentence (it being understood, however, that the indemnifying party shall not be liable for the expenses of more than one separate counsel (in addition to one local counsel), representing the indemnified parties under Section 8(a) or 8(b), as the case may be, who are parties to such action), (ii) the indemnifying party shall have elected not to assume the defense of such action, (iii) the indemnifying party shall not have employed counsel satisfactory to the indemnified party to represent the indemnified party within a reasonable time after notice of the commencement of the action, or (iv) the indemnifying party has authorized the employment of counsel for the indemnified party at the expense of the indemnifying party. Notwithstanding the foregoing sentence, an indemnifying party shall not be liable for any settlement of any proceeding effected without its written consent (such consent not to be unreasonably withheld), but if settled with such consent or if there be a final judgment for the plaintiff, the indemnifying party agrees to indemnify the indemnified party from and against any loss or liability by reason of such settlement or judgment. No indemnifying party shall, without the prior written consent of the indemnified party, effect any settlement of any pending or threatened proceeding in respect of which indemnification may be sought hereunder (whether or not the indemnified party is an actual or potential party to such a proceeding), unless such settlement (i) includes an unconditional release of such indemnified party from all liability on claims that are the subject matter of such proceeding and (ii) does not include a statement as to or an admission of fault, culpability or failure to act by or on behalf of any indemnified party. Section 9. Contribution. If the indemnification provided for in Section 8 hereof is unavailable to or insufficient to hold harmless an indemnified party in respect of any losses, claims, damages or liabilities, or actions in respect thereof, referred to therein, then each indemnifying party shall contribute to the amount paid or payable by such indemnified party as a result of such losses, claims, damages or liabilities, or actions in respect thereof, in such proportion as is appropriate to reflect the relative fault of the Company on the one hand and the Remarketing Agent on the other in connection with the statements or omissions which resulted in such losses, claims, damages or liabilities, or actions in respect thereof, as well as any other relevant equitable considerations, including relative benefit. The relative fault shall be determined by reference to, among other things, whether the untrue or alleged untrue statement of a material fact or omission or alleged omission to state a material fact required to be stated therein or necessary in order to make the statements therein not misleading relates to information supplied by the Company on the one hand or the Remarketing Agent on the other hand and the parties' relative intent, knowledge, access to information and opportunity to correct or prevent such statement or omission. The Company and the Remarketing Agent agree that it would not be just and equitable if contribution pursuant to this Section 9 were to be determined by pro rata allocation or by any other method of allocation 21 which does not take into account the equitable considerations referred to above in this Section 9. The amount paid or payable by an indemnified party as a result of the losses, claims, damages or liabilities, or actions in respect thereof, referred to above in this Section 9 shall be deemed to include any legal or other expenses reasonably incurred by such indemnified party in connection with investigating or defending any such claim or action. No person guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of the Securities Act) shall be entitled to contribution from any person who was not guilty of such fraudulent misrepresentation. The remedies provided for in this Section 9 are not exclusive and shall not limit any rights or remedies which may otherwise be available to any indemnified party at law or in equity. Section 10. Resignation and Removal of the Remarketing Agent. The Remarketing Agent may resign and be discharged from its duties and obligations hereunder by giving 60 days' prior written notice to the Company, the Depositary, the Indenture Trustee and the Purchase Contract Agent. The Company may, in its discretion, remove the Remarketing Agent by giving 60 days' prior written notice (or seven days' prior written notice on or after the Initial Remarketing Date if the Initial Remarketing is not successful) to the removed Remarketing Agent, the Depositary, the Indenture Trustee and the Purchase Contract Agent. Notwithstanding any other provision in this Section 10, no such resignation nor any such removal shall become effective until the Company shall have appointed at least one nationally recognized broker-dealer as successor Remarketing Agent and such successor Remarketing Agent shall have entered into a remarketing agreement with the Company, in which it shall have agreed to conduct the Remarketing in accordance with the Remarketing Procedures. The provisions of Sections 5, 8 and 9 shall survive the resignation or removal of any Remarketing Agent pursuant to this Agreement. Section 11. Dealing in the Remarketing Senior Notes. The Remarketing Agent, when acting as a Remarketing Agent or in its individual or any other capacity, may, to the extent permitted by law, buy, sell, hold and deal in any of the Remarketing Senior Notes. The Remarketing Agent may exercise any vote or join in any action which any beneficial owner of Remarketing Senior Notes may be entitled to exercise or take pursuant to the Indenture with like effect as if it did not act in any capacity hereunder. The Remarketing Agent, in its individual capacity, either as principal or agent, may also engage in or have an interest in any financial or other transaction with the Company as freely as if it did not act in any capacity hereunder. Section 12. Remarketing Agent's Performance; Duty of Care. The duties and obligations of the Remarketing Agent shall be determined solely by the express provisions of this Agreement, the Indenture and the Senior Notes. No implied covenants or obligations of or against the Remarketing Agent shall be read into this Agreement, the Indenture or the Senior Notes. In the absence of bad faith on the part of the Remarketing Agent, the Remarketing Agent may conclusively rely upon any document furnished to it, which purports to conform to the requirements of this Agreement, the Indenture or the Senior Notes as 22 to the truth of the statements expressed in any of such documents. The Remarketing Agent shall be protected in acting upon any document or communication reasonably believed by it to have been signed, presented or made by the proper party or parties. The Remarketing Agent, acting under this Agreement, shall incur no liability to the Company or to any holder of Remarketing Senior Notes in its individual capacity or as Remarketing Agent for any action or failure to act, on its part in connection with a Remarketing or otherwise, except if such liability is judicially determined to have resulted from the gross negligence or willful misconduct on its part. Section 13. Termination. This Agreement shall terminate as to the Remarketing Agent on the effective date of the resignation or removal of the Remarketing Agent pursuant to Section 10. In addition, the obligations of the Remarketing Agent hereunder may be terminated by it by notice given to the Company prior to 10:00 a.m. (New York City time) on the Remarketing Date if, prior to that time, any of the events described in Sections 7(g), (h) and (i) shall have occurred. Section 14. Notices. All statements, requests, notices and agreements hereunder shall be in writing, and: (a) if to the Remarketing Agent, shall be delivered or sent by mail, telex or facsimile transmission to Salomon Smith Barney Inc., 388 Greenwich Street, 34th Floor, New York, NY 10013, Attention: Arthur H. Tildesley (Fax: (212)816-0900); (b) if to the Company shall be delivered or sent by mail, telex or facsimile transmission to the address of the Company set forth in the Prospectus, Attention: Treasurer (Fax: (804) 819-2211). Any such statements, requests, notices or agreements shall take effect at the time of receipt thereof. Section 15. Persons Entitled to Benefit of Agreement. This Agreement shall inure to the benefit of and be binding upon the Remarketing Agent, the Company and their respective successors. This Agreement and the terms and provisions hereof are for the sole benefit of only those persons, except that (x) the representations, warranties, indemnity and contribution agreements and other agreements of the Company contained in this Agreement shall also be deemed to be for the benefit of the officers and employees of the Remarketing Agent and the person or persons, if any, who control the Remarketing Agent within the meaning of Section 15 of the Securities Act and (y) the indemnity and contribution agreements of the Remarketing Agent contained in Sections 8(b) and 9 of this Agreement shall be deemed to be for the benefit of directors, officers and employees of the Company and any person controlling the Company within the meaning of Section 15 of the Securities Act. Nothing contained in this Agreement is intended or shall be construed to give any person, other than the persons referred to herein, any legal or equitable right, remedy or claim under or in respect of this Agreement or any provision contained herein. 23 Section 16. Survival. The respective indemnities, representations, warranties and agreements of the Company and the Remarketing Agent contained in this Agreement or made by or on behalf of them, respectively, pursuant to this Agreement, shall survive the Remarketing and shall remain in full force and effect, regardless of any investigation made by or on behalf of any of them or any person controlling any of them. Section 17. Governing Law. This Agreement shall be governed by, and construed in accordance with, the laws of New York. Section 18. Counterparts. This Agreement may be executed in one or more counterparts and, if executed in more than one counterpart, the executed counterparts shall each be deemed to be an original but all such counterparts shall together constitute one and the same instrument. Section 19. Headings. The headings herein are inserted for convenience of reference only and are not intended to be part of, or to affect the meaning or interpretation of, this Agreement. If the foregoing correctly sets forth the agreement between the Company and the Remarketing Agent, please indicate your acceptance in the space provided for that purpose below. Very truly yours, DOMINION RESOURCES, INC. By:_______________________________ Title: Accepted: SALOMON SMITH BARNEY INC. By:______________________ EX-8 8 dex8.txt TAX OPINION OF MCGUIREWOODS LLP Exhibit 8 [MCGUIREWOODS LETTERHEAD APPEARS HERE] March 18, 2002 Dominion Resources, Inc. 120 Tredegar Street Richmond, Virginia 23219 Ladies and Gentlemen: We have been requested, as your special tax counsel, to render federal tax advice in connection with the (i) Registration Statement on Form S-3 (File No. 333-55904) (the "Registration Statement") filed by Dominion Resources, Inc. (the "Company") with the Securities and Exchange Commission for the purpose of registering under the Securities Act of 1933, as amended (the "Securities Act"), the Company's Senior Debt Securities, Junior Subordinated Debentures, Trust Preferred Securities and Related Guarantee, Common Stock, Preferred Stock, Stock Purchase Contracts and Stock Purchase Units, from the sale of which the Company may receive proceeds of up to $2,000,000,000, to be offered from time to time by the Company on terms to be determined at the time of the offering and (ii) the issuance by the Company of up to 6,600,000 Upper DECS Equity Income Securities ("Equity Income Securities") consisting of up to 6,600,000 Corporate Units, as described in the Company's Prospectus, dated March 2, 2001 (the "Prospectus"), which is a part of the Registration Statement, and Prospectus Supplement, dated March 13, 2002 (the "Prospectus Supplement"). Capitalized terms used and not defined herein shall have the meanings assigned to them in the Prospectus Supplement. We have reviewed the discussion set forth in the Prospectus Supplement under the heading "United States Federal Income Tax Consequences" and hereby advise you that, we are of the opinion that under current United States federal income tax law, although such discussion does not purport to discuss all possible United States federal income tax consequences of the Equity Income Securities, such discussion constitutes an accurate summary of the matters discussed therein in all material respects. We hereby consent to the filing of this opinion as an exhibit to the Company's Current Report on Form 8-K and the incorporation of this opinion by reference in the Registration Statement and to references to us under the heading "Legal Opinions" in the Prospectus Supplement and under the heading "Legal Opinions" in the Prospectus. We do not admit by giving this consent that we are in the category of persons whose consent is required under Section 7 of the Securities Act. Very truly yours, /s/ McGuireWoods LLP EX-12 9 dex12.txt COMPUTATION OF RATIO OF EARNINGS TO FIXED CHARGES DOMINION RESOURCES, INC. AND SUBSIDIARIES EXHIBIT 12 RATIO OF EARNINGS TO FIXED CHARGES (Millions of Dollars)
Years ended December 31, 2001 (a) 2000 (b) 1999 1998 1997 (c) -------- -------- ---- ---- -------- Earnings, as defined: Earnings before income taxes and minority interests in consolidated subsidiaries 914.0 600.0 829.0 887.0 679.0 Distributed income from unconsolidated investees, less equity in earnings 33.0 6.3 Fixed charges included in the determination of net income 1025.8 1041.7 583.0 656.1 684.1 --------- --------- --------- -------- --------- Total earnings, as defined 1972.8 1648.0 1412.0 1543.1 1363.1 --------- --------- --------- -------- --------- Fixed charges, as defined: Interest charges 1063.6 1039.3 591.8 669.5 707.7 Rental interest factor 18.8 18.2 8.0 6.0 7.8 --------- --------- --------- -------- --------- Total fixed charges, as defined 1082.4 1057.5 599.8 675.5 715.5 --------- --------- --------- -------- --------- --------- --------- --------- -------- --------- Ratio of Earnings to Fixed Charges 1.82 1.56 2.35 2.28 1.91 ========= ========= ========= ======== =========
(a) Earnings for the twelve months ended December 31, 2001 includes a one-time $220 million charge related to the buyout of power purchase contracts and non-utility generating plants previously serving the company under long-term contracts, a one-time $40 million charge associated with the divestiture of Saxon Capital, Inc., a $281 million charge from a write-down of Dominion Capital assets, a $151 million charge associated with Dominion's estimated Enron exposure, and $105 million in restructuring charges associated with a senior management restructuring initiative announced in November and other restructuring costs. Excluding these items from the calculation above results in a ratio of earnings to fixed charges for the twelve months ended December 31, 2001 of 2.56x. (b) Earnings for the twelve months ended December 31, 2000 includes $579 million in restructuring and other acquisition-related costs resulting from the CNG acquisition and a write-down at Dominion Capital, Inc. Dominion is required to divest its financial services business as a result of the acquisition of CNG. Excluding these items from the calculation above results in a ratio of earnings to fixed charges for the twelve months ended December 31, 2000 of 2.10x. (c) Earnings for the twelve months ended December 31, 1997 includes the one- time charge of $157 million for the windfall profits tax levied by the United Kingdom government. Excluding this charge from the calculation above results in a ratio of earnings to fixed charges for the twelve months ended December 31, 1997 of 2.12x. -----END PRIVACY-ENHANCED MESSAGE-----