UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, DC  20549

FORM 8-K


CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934


Date of report (Date of earliest event reported) January 24, 2013

Dominion Resources, Inc.
(Exact Name of Registrant as Specified in Its Charter)


Virginia
(State or other jurisdiction
of incorporation)
001-08489
(Commission
File Number)
54-1229715
(IRS Employer
Identification No.)


120 Tredegar Street
Richmond, Virginia
(Address of Principal Executive Offices)
 
23219
(Zip Code)

Registrant’s Telephone Number, Including Area Code (804) 819-2000



(Former Name or Former Address, if Changed Since Last Report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions ( see General Instruction A.2. below):

o       Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

o       Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

o       Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

o       Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

 
 
 

Item 5.02.  Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.


2013 Annual Incentive Plan

On January 24, 2013, the Dominion Resources, Inc. (Dominion) Compensation, Governance and Nominating Committee (CGN Committee) approved the 2013 Annual Incentive Plan (the “Plan”).  Under the Plan, Dominion’s officers are eligible for an annual performance-based cash award.  Each officer has a target incentive award under the Plan based on a percentage of base salary.  For 2013, the target percentages of base salary for Dominion’s named executive officers are as follows:  Chairman, President and Chief Executive Officer – 125%; Executive Vice President and Chief Financial Officer – 100%; Executive Vice President and Chief Executive Officer – Dominion Generation Business Unit – 90%; Executive Vice President and Chief Executive Officer – Dominion Virginia Power Business Unit – 90%; and Executive Vice President and Chief Executive Officer – Dominion Energy Business Unit – 90%.

The Plan is funded based on the achievement of consolidated financial operating earnings goals, with potential funding ranging from 0% to 200% of the target funding with the CGN Committee retaining negative discretion with respect to funding for those officers subject to Internal Revenue Code Section 162(m).  For most officers, payout of the amount funded under the Plan is subject to achievement of applicable consolidated financial, business unit financial, and operating and stewardship goals, including safety and diversity.  For those Dominion officers whose compensation may be subject to the deduction limits imposed under Internal Revenue Code Section 162(m), payout of incentives under the Plan will be based solely on the achievement of the funding goals in order preserve the deduction of any payouts they receive under the Plan.  

The CGN Committee has the authority to exercise negative discretion to lower payouts for the named executive officers if discretionary goals adopted by the named executive officers are not achieved.  All of the named executive officers have adopted discretionary consolidated financial, safety and diversity goals.  The weighting for the safety and diversity goals is 5% for each goal.  In addition, all of the named executive officers, except for the Chief Executive Officer and Chief Financial Officer, have adopted a discretionary business unit financial goal with a weighting of 45% for such goal.

The Plan includes a provision granting the CGN Committee discretion to require repayment of payouts made to any participant who engages in fraudulent or intentional misconduct that directly causes the need for a restatement of Dominion’s financial statements or who engages in fraudulent or intentional misconduct related to or materially affecting the company’s business operations.


2013 Long-Term Incentive Program

On January 24, 2013, the CGN Committee approved the 2013 Long-Term Incentive Program (the “Program”) for its officers, including its named executive officers.  The Program is being awarded pursuant to Dominion’s 2005 Incentive Compensation Plan, as amended, and consists of two components of equal value: a restricted stock grant and a cash-based performance grant. The restricted stock is subject to a three-year cliff vesting period, while payout of the performance grant will be based on the achievement of two performance metrics: total shareholder return relative to companies that are listed as members of the Philadelphia Utility Index (weighted 50%) and return on invested capital (weighted 50%).  Payout on the performance grant will be made by March 15, 2015, with the amount of the award to vary depending on the level of achievement of the performance metrics.  The CGN Committee retains authority to exercise negative discretion to lower payouts as it may deem appropriate, in its sole discretion.  The Program includes a provision granting the CGN Committee discretion to require repayment or recovery of cash-based performance grant or restricted stock payouts made to any officer who engages in fraudulent or intentional misconduct that directly causes the need for a restatement of Dominion’s financial statements or who engages in fraudulent or intentional misconduct related to or materially affecting the company’s business operations.

The description of the Program is a summary only and is qualified by reference to the 2013 Performance Grant Plan and form of 2013 Restricted Stock Award Agreement, which are filed as Exhibits 10.1 and 10.2, respectively.


Item 9.01 Financial Statements and Exhibits.

Exhibit
 
10.1
2013 Long-Term Incentive Program – 2013 Performance Grant Plan
10.2
2013 Long-Term Incentive Program – Form of 2013 Restricted Stock Award Agreement
   



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 hereunto duly authorized.

DOMINION RESOURCES, INC.
Registrant
 
  /s/Carter M. Reid
Carter M. Reid
Senior Vice President – Administrative Services and Corporate Secretary
 

Date:  January 25, 2013

 

DOMINION RESOURCES, INC.
2013 PERFORMANCE GRANT PLAN


1.             Purpose.    The purpose of the 2013 Performance Grant Plan (the “Plan”) is to set forth the terms of 2012 Performance Grants awarded by Dominion Resources, Inc., a Virginia corporation (the “Company”), pursuant to the Dominion Resources, Inc. 2005 Incentive Compensation Plan and any amendments thereto (the “2005 Incentive Compensation Plan”).  This Plan contains the Performance Goals for the awards, the Performance Criteria, the target and maximum amounts payable, and other applicable terms and conditions.

2.             Definitions.   Capitalized terms used in this Plan not defined in this Section 2 will have the meaning assigned to such terms in the 2005 Incentive Compensation Plan.

a.            Cause .  For purposes of this Plan, the term “Cause” will have the meaning assigned to that term under a Participant’s Employment Continuity Agreement with the Company, as such Agreement may be amended from time to time.

b.            Date of Grant .  February 1, 2013.

c.            Disability or Disabled .  Means a “disability” as defined under Treasury Regulation Section 1.409A-3(i)(4). The Committee will determine whether or not a Disability exists and its determination will be conclusive and binding on the Participant.

d.            Participant .  An officer of the Company or a Dominion Company who receives a Performance Grant on the Date of Grant.

e.            Performance Period .  The 24-month period beginning on January 1, 2013 and ending on December 31, 2014.

f.            Retire or Retirement .  For purposes of this Plan, the term Retire or Retirement means a voluntary termination of employment on a date when the Participant is eligible for early or normal retirement benefits under the terms of the Dominion Pension Plan, or would be eligible if any crediting of deemed additional years of age or service applicable to the Participant under the Company’s Benefit Restoration Plan or New Benefit Restoration Plan was applied under the Dominion Pension Plan, as in effect at the time of the determination, unless the Company’s Chief Executive Officer of the Company determines, in his sole discretion, that the Participant’s retirement is detrimental to the Company.

g.            Target Amount .  The dollar amount designated in the written notice to the Participant communicating the Performance Grant.

3.             Performance Grants.   A Participant will receive a written notice of the amount designated as the Participant’s Target Amount for the Performance Grant payable under the terms of this Plan.  The actual payout may be from 0% to 200% of the Target Amount, depending on the achievement of the Performance Goals.

4.             Performance Achievement and Time of Payment .  Upon the completion of the Performance Period, the Committee will determine the final Performance Goal achievement of each of the Performance Criteria described in Section 6.  The Company will then calculate the final amount of each Participant’s Performance Grant based on such Performance Goal achievement.  Except as provided in Sections 7(b) or 8, the Committee will determine the time of payout of the Performance Grants, provided that in no event will payment be made later than March 15, 2015.

5.             Forfeiture.   Except as provided in Sections 7 and 8, a Participant's right to payout of a Performance Grant will be forfeited if the Participant’s employment with the Company or a Dominion Company terminates for any reason before the end of the Performance Period.

6.             Performance Goals.   Payout of Performance Grants will be based on the Performance Goal achievement described in this Section 6 of the Performance Criteria defined in Exhibit A.

a.            TSR Performance .  Total Shareholder Return Performance (“TSR Performance”) will determine fifty percent (50%) of the Target Amount (“TSR Percentage”).  TSR Performance is defined in Exhibit A.  The percentage of the TSR Percentage that will be paid out, if any, is based on the following table:


Relative
TSR Performance                                                                   Percentage Payout
Percentile Ranking                                                                 of TSR Percentage
85 th or above                           200%                                 
50 th                                  100%                          
25 th                                    50%                                            
Below 25 th                                  0%
                        
To the extent that the Company’s Relative TSR Performance ranks in a percentile between the 25 th and 85 th percentile in the table above, then the TSR Percentage payout will be interpolated between the corresponding TSR Percentage payout set forth above.  No payment of the TSR Percentage will be made if the Relative TSR Performance is below the 25 th percentile, except that a payment of 25% of the TSR Percentage will be made if the Company’s Relative TSR Performance is below the 25 th percentile but its Absolute TSR Performance is at least 9%.  In addition to the foregoing payments, and regardless of the Company’s Relative TSR Performance, if the Company’s Absolute TSR Performance is either (i) at least 10% but less than 15%, then an additional payment of 25% of the TSR Percentage will be made, or (ii) at least 15%, then an additional payment of 50% of the TSR Percentage will be made (in either case, the “Performance Adder”); provided, however, that the aggregate payments under this Section 6(a) shall never exceed 200% of the TSR Percentage. The Committee may reduce or eliminate payment of the Performance Adder in its sole discretion.

b.            ROIC Performance .  Return on Invested Capital Performance (“ROIC Performance”) will determine fifty percent (50%) of the Target Amount (“ROIC Percentage”).  ROIC Performance is defined in Exhibit A.  The percentage of the ROIC Percentage that will be paid out, if any, is based on the following table:

 
 
 

 
        Percentage Payout
ROIC Performance                                                                      of ROIC Percentage
7.89% and above                        200%
7.64%                             125%
7.15%  - 7.40%                                                                             100%
7.07%                                                                                            50%
Below 7.07%                           0%
 

 
–  
To the extent that the Company’s ROIC Performance is greater than 7.07% and less than 7.15%, the ROIC Percentage payout will be interpolated between the applicable Percentage Payout of ROIC Percentage range set forth above.
–  
To the extent that the Company’s ROIC Performance is greater than 7.40% and less than 7.64%, the ROIC Percentage payout will be interpolated between the applicable Percentage Payout of ROIC Percentage range set forth above.
–  
To the extent that the Company’s ROIC Performance is greater than 7.64% and less than 7.89%, the ROIC Percentage payout will be interpolated between the applicable Percentage Payout of ROIC Percentage range set forth above.

7.           Retirement, Involuntary Termination without Cause, Death or Disability.

a.            Retirement or Involuntary Termination without Cause .  Except as provided in Section 8, if a Participant Retires during the Performance Period or if a Participant’s employment is involuntarily  terminated by the Company or a Dominion Company without Cause during the Performance Period, and in either case the Participant would have been eligible for a payment if the Participant had remained employed until the end of the Performance Period, the Participant will receive a pro-rated payout of the Participant’s Performance Grant equal to the payment the Participant would have received had the Participant remained employed until the end of the Performance Period multiplied by a fraction, the numerator of which is the number of whole months from the Date of Grant to the first day of the month coinciding with or immediately following the date of the Participant’s retirement or termination of employment, and the denominator of which is twenty-three (23).  Payment will be made after the end of the Performance Period at the time provided in Section 4 based on the Performance Goal achievement approved by the Committee.  If the Participant Retires, however, no payment will be made if the Company’s Chief Executive Officer determines, in his sole discretion, that the Participant’s Retirement is detrimental to the Company.

b.            Death or Disability .  If, while employed by the Company or a Dominion Company, a Participant dies or becomes Disabled during the Performance Period, the Participant or, in the event of the Participant’s death, the Participant’s Beneficiary will receive a lump sum cash payment equal to the product of (i) and (ii) where:

 
(i)
is the amount that would be paid based on the predicted performance used for determining the compensation cost recognized by the Company for the Participant’s Performance Grant for the latest financial statement filed with the Company’s Annual Report on Form 10-K or Quarterly Report on Form 10-Q immediately prior to the event; and

 
(ii)
is a fraction, the numerator of which is the number of whole months from the Date of Grant to the first day of the calendar month coinciding with or immediately following the date of the Participant’s death or Disability, and the denominator of which is twenty-three (23).

Payment under this Section 7(b) will be made as soon as administratively feasible (and in any event within sixty (60) days))   after the date of the Participant’s death or Disability, and the Participant shall not have the right to any further payment under this Agreement.  In the event of the Participant’s death, payment will be made to the Participant’s designated Beneficiary.  If the Participant has not designated a Beneficiary, the Participant’s spouse, if any, and if none the Participant’s estate shall be the Beneficiary.

8.             Qualifying Change of Control.   Upon a Qualifying Change of Control prior to the end of the Performance Period, provided the Participant has remained continuously employed with Dominion or a Dominion Company from the Date of Grant to the date of the Qualifying Change of Control, the Participant will receive a lump sum cash payment equal to the greater of (i) the Target Amount or (ii) the total payout that would be made at the end of the Performance Period if the predicted performance used for determining the compensation cost recognized by the Company for the Participant’s Performance Grant for the latest financial statement filed with the Company’s Annual Report on Form 10-K or Quarterly Report on Form 10-Q immediately prior to the Qualifying Change of Control was the actual performance for the Performance Period (in either case, the “COC Payout Amount”).  Payment will be made on or as soon as administratively feasible following the Qualifying Change of Control date and in no event later than sixty (60) days following the Qualifying Change of Control date. If a Qualifying Change of Control occurs prior to the end of the Performance Period and after a Participant has Retired or been involuntarily terminated without Cause pursuant to Section 7(a) above, then the Participant will receive a pro-rated payout of the Participant’s Performance Grant, equal to the COC Payout Amount multiplied by the fraction set forth in Section 7(a) above, with payment occurring in a cash lump sum on or as soon as administratively feasible (but in any event within sixty (60) days) after the Qualifying Change of Control date. Following any payment under this Section 8, the Participant shall not have the right to any further payment under this Agreement.

9.             Termination for Cause.   Notwithstanding any provision of this Plan to the contrary, if the Participant’s employment with the Company or a Dominion Company is terminated for Cause (as defined by the Employment Continuity Agreement between the Participant and the Company), the Participant will forfeit all rights to his or her Performance Grant.

10.           Clawback of Award Payment.
 
           a.       Restatement of Financial Statements .  If the Company’s financial statements are required to be restated at any time within a two (2) year period following the end of the Performance Period as a result of fraud or intentional misconduct, the Committee may, in its discretion, based on the facts and circumstances surrounding the restatement, direct the Company  to recover all or a portion of the Performance Grant payout from the Participant if the Participant’s conduct directly caused or partially caused the need for the restatement.
 
           b.       Fraudulent or Intentional Misconduct .  If the Company determines that the Participant has engaged in fraudulent or intentional misconduct related to or materially affecting the Company’s business operations or the Participant’s duties at the Company, the Committee may, in its discretion, based on the facts and circumstances surrounding the misconduct, direct the Company to withhold payment, or if payment has been made, to recover all or a portion of the Performance Grant payout from the Participant.
 
           c.       Recovery of Payout .  The Company reserves the right to recover a Performance Grant payout pursuant to this Section 10 by (i) seeking repayment from the Participant; (ii) reducing the amount that would otherwise be payable to the Participant under another Company benefit plan or compensation program to the extent permitted by applicable law; (iii) withholding future annual and long-term incentive awards or salary increases; or (iv) taking any combination of these actions.
 
           d.       No Limitation on Remedies .  The Company’s right to recover a Performance Grant payout pursuant to this Section 10 shall be in addition to, and not in lieu of, actions the Company may take to remedy or discipline a Participant’s misconduct including, but not limited to, termination of employment or initiation of a legal action for breach of fiduciary duty.
 
           e.       Subject to Future Rulemaking .  The Performance Grant payout is subject to any claw back policies the Company may adopt in order to conform to the requirements of Section 954 of the Dodd-Frank Wall Street Reform Act and Consumer Protection Act and resulting rules issued by the Securities and Exchange Commission or national securities exchanges thereunder and that the Company determines should apply to this Performance Grant Plan.

11.           Miscellaneous.
 
           a.       Nontransferability .  Except as provided in Section 7(b), a Performance Grant is not transferable and is subject to a substantial risk of forfeiture until the end of the Performance Period.
 
           b.       No Right to Continued Employment .  A Performance Grant does not confer upon a Participant any right with respect to continuance of employment by the Company, nor will it interfere in any way with the right of the Company to terminate a Participant's employment at any time.
 
           c.       Tax Withholding .  The Company will withhold Applicable Withholding Taxes from the payout of Performance Grants.
 
           d.       Application of Code Section 162(m) .  Performance Grants are intended to constitute “qualified performance-based compensation” within the meaning of section 1.162-27(e) of the Income Tax Regulations.  The Committee will certify the achievement of the Performance Goals described in Section 6.  To the maximum extent possible, this Plan will be interpreted and construed in accordance with this subsection 11(d).

     e.            Negative Discretion .  Pursuant to Section 6(c) of the 2005 Incentive Compensation Plan, the Committee retains the authority to exercise negative discretion to reduce payments under this Plan as it deems appropriate.

     f.            Governing Law .  This Plan shall be governed by the laws of the Commonwealth of Virginia, without regard to its choice of law provisions.

     g.            Conflicts .  In the event of any material conflict between the provisions of the 2005 Incentive Compensation Plan and the provisions of this Plan, the provisions of the 2005 Incentive Compensation Plan will govern.

     h.            Participant Bound by Plan .  By accepting a Performance Grant, a Participant acknowledges receipt of a copy of this Plan and the 2005 Incentive Compensation Plan document and Prospectus, which are accessible on the Company Intranet, and agrees to be bound by all the terms and provisions thereof.

     i.            Binding Effect .   This Plan will be binding upon and inure to the benefit of the legatees, distributes, and personal representatives of Participants and any successors of the Company.
 
     j.            Section 409A . This Plan and the Performance Grants hereunder are intended to comply with Section 409A of the Internal Revenue Code of 1986, as amended (“Code Section 409A”), and shall be interpreted to the maximum extent possible in accordance with such intent. To the extent necessary to comply with Code Section 409A, no payment will be made earlier than six months after a Participant’s termination of employment other than for death if the Performance Grant is subject to Code Section 409A and the Participant is a “specified employee” (within the meaning of Code Section 409A(a)(2)(B)(i)).


-  -
 
 
 

EXHIBIT A


DOMINION RESOURCES, INC.
2013 PERFORMANCE GRANT PLAN
PERFORMANCE CRITERIA

Total Shareholder Return

Relative TSR Performance will be measured based on where the Company’s total shareholder return during the Performance Period ranks in relation to the total shareholder returns of the companies that are listed as members of the Philadelphia Utility Index as of the end of the Performance Period (the “Comparison Companies”). Absolute TSR Performance will be the Company’s total shareholder return on a compounded annual basis for the Performance Period.  In general, total shareholder return consists of the difference between the value of a share of common stock at the beginning and end of the Performance Period, plus the value of dividends paid as if reinvested in stock and other appropriate adjustments for such events as stock splits.  For purposes of TSR Performance, the total shareholder return of the Company and the Comparison Companies will be the total shareholder return as calculated by Bloomberg L.P.  As soon as practicable after the completion of the Performance Period, the total shareholder returns of the Comparison Companies will be obtained from Bloomberg L.P. and ranked from highest to lowest.  The Company’s total shareholder return will then be ranked in terms of which percentile it would have placed in among the Comparison Companies.

Return on Invested Capital

Return on Invested Capital (ROIC)

The following terms are used to calculate ROIC for purposes of the 2013 Performance Grant:

ROIC means Total Return divided by Average Invested Capital.  Performance will be calculated for the two successive fiscal years within the Performance Period, added together and then divided by two to arrive at an annual average ROIC for the Performance Period.

Total Return means Operating Earnings plus After-tax Interest & Related Charges, all determined for the two successive fiscal years within the Performance Period.

Operating Earnings means operating earnings as disclosed on the Company’s earnings report furnished on Form 8-K for the applicable fiscal year.

 Average Invested Capital means the Average Balances for Long & Short-term Debt plus Preferred Equity plus Common Shareholders’ Equity.  The Average Balances for a year are calculated by performing the calculation at the end of each month during the fiscal year plus the last month of the prior fiscal year and then averaging those amounts over 13 months.  Long and short-term debt shall exclude debt that is non-recourse to Dominion Resources, Inc. (Dominion) or its subsidiaries where Dominion or its subsidiaries has not made an associated investment.  Short-term debt shall be net of cash and cash equivalents.

Average Invested Capital will be calculated by excluding (i) accumulated other comprehensive income/(loss) from Common Shareholders’ Equity (as shown on the Company’s financial statements during the Performance Period); (ii) impacts from changes in accounting principles that were not prescribed as of the Date of Grant; and (iii) the effects of incremental impacts from non-operating gains or losses during the Performance Period, as disclosed on the Company’s earnings report furnished on Form 8-K, that were not included in the projection on which the original ROIC calculation was based at the time of the grant. 



DOMINION RESOURCES, INC.
RESTRICTED STOCK AWARD AGREEMENT

 
PARTICIPANT
 
«First_Name» «Last_Name»
 
 
DATE OF GRANT
 
February 1, 2013
 
NUMBER OF SHARES OF RESTRICTED STOCK GRANTED
 
«Restricted_Stock_Award_Granted»
 
PERSONNEL NUMBER
 
«Personnel_»
 
 
VESTING DATE
 
February 1, 2016
 
VESTING SCHEDULE
                   Vesting Date                Percentage
                 February 1, 2016              100%

THIS AGREEMENT, effective as of the Date of Grant shown above, between Dominion Resources, Inc., a Virginia Corporation (the "Company") and the Participant named above is made pursuant and subject to the provisions of the Dominion Resources, Inc. 2005 Incentive Compensation Plan and any amendments thereto (the "Plan").  All terms used in this Agreement that are defined in the Plan have the same meaning given to such terms in the Plan.

1.  
Award of Stock .  Pursuant to the Plan, the Number of Shares of Restricted Stock Granted  shown above (the “Restricted Stock”) were awarded to the Participant on the Date of Grant shown above, subject to the terms and conditions of the Plan, and subject further to the terms and conditions set forth in this Agreement.

2.  
Vesting .  Except as provided in Sections 3, 4, 5 or 6, one hundred percent (100%) of the shares of Restricted Stock awarded under this Agreement will vest on the Vesting Date shown above.

3.  
Forfeiture .  Except as provided in Sections 4 or 5, the Participant will forfeit any and all rights in the Restricted Stock if the Participant’s employment with the Company or a Dominion Company terminates for any reason prior to the Vesting Date.

4.  
Death, Disability, Retirement or Involuntary Termination without Cause .  Except as provided in Section 5, if the Participant terminates employment due to death, Disability, or Retirement (as such term is defined in Section 8(e)) before the Vesting Date or if the Participant’s employment is involuntarily terminated by the Company or a Dominion Company without Cause (as defined in the Employment Continuity Agreement between the Participant and the Company) before the Vesting Date, the Participant will become vested in the number of shares of Restricted Stock awarded under this Agreement multiplied by a fraction, the numerator of which is the number of whole months from the Date of Grant to the first day of the month coinciding with or immediately following the date of the Participant’s termination of employment, and the denominator of which is the number of whole months from the Date of Grant to the Vesting Date, rounded down to the nearest whole share.  If the Participant Retires, however, the Participant’s Restricted Stock will not vest if the Company’s Chief Executive Officer determines, in his sole discretion, that the Participant’s Retirement is detrimental to the Company.  The vesting will occur on the first day of the month coinciding with or immediately following the date of the Participant’s termination of employment due to death, Disability, Retirement, or termination by the Company without Cause.  Any shares of Restricted Stock that do not vest in accordance with this Section 4 will be forfeited.

5.  
Change of Control .  Upon a Change of Control prior to the Vesting Date, provided the Participant has remained continuously employed with Dominion or a Dominion Company from the Date of Grant to the date of the Change of Control, the Participant’s rights in the Restricted Stock will become vested as follows:

a.  
A portion of the Restricted Stock will be immediately vested equal to the number of shares of Restricted Stock awarded under this Agreement multiplied by a fraction, the numerator of which is the number of whole months from the Date of Grant to the Change of Control date, and the denominator of which is the number of whole months from the Date of Grant to the Vesting Date, rounded down to the nearest whole share.

b.  
Unless previously forfeited, the remaining shares of Restricted Stock will become vested after a Change of Control at the earliest of the following events and in accordance with the terms described in subsections (i) through (iii) below:

(i)  
Vesting Date .  All remaining shares of Restricted Stock will become vested on the Vesting Date.

(ii)  
Death, Disability or Retirement .  If the Participant terminates employment due to death, Disability or Retirement (as defined in Section 8(e)) before the Vesting Date, the Participant will become vested in the remaining shares of Restricted Stock multiplied by a fraction, the numerator of which is the number of  whole months from the first day of the month in which the Change of Control occurs to the first day of the month coinciding with or immediately following the Participant’s termination of employment, and the denominator of which is the number of whole months from the first day of the month in which the Change of Control occurs to the Vesting Date, rounded down to the nearest whole share. If the Participant Retires, however, the Participant’s Restricted Stock will not vest if the Company’s Chief Executive Officer, in his sole discretion, determines that the Participant’s Retirement is detrimental to the Company.  The vesting will occur on the first day of the month coinciding with or immediately following the Participant’s termination of employment due to death, Disability, or Retirement. Any shares of the Restricted Stock that do not vest in accordance with the terms of this subsection (ii) will be forfeited.

(iii)  
Involuntary Termination without Cause .  All remaining shares of Restricted Stock will become vested upon the Participant’s involuntary termination by the Company or a Dominion Company without Cause before the Vesting Date, or upon the Participant’s Constructive Termination before the Vesting Date, as such terms are defined by the Employment Continuity Agreement between the Participant and the Company.

6.  
Termination for Cause .  Notwithstanding any provision of this Agreement to the contrary, if the Participant’s employment with the Company or a Dominion Company is terminated for Cause (as defined by the Employment Continuity Agreement between the Participant and the Company), the Participant will forfeit all Restricted Stock shares awarded pursuant to this Agreement.

7.  
Clawback of Award Payment .

a.  
Restatement of Financial Statements .  If the Company’s financial statements are required to be restated at any time within a two (2) year period following the Vesting Date as a result of fraud or intentional misconduct, the Committee may, in its discretion, based on the facts and circumstances surrounding the restatement, direct the Company to withhold issuance of all or a portion of the shares granted pursuant to this Agreement, or if shares have been issued, to recover all or a portion of the shares from the Participant if the Participant’s conduct directly caused or partially caused the need for the restatement.

b.  
Fraudulent or Intentional Misconduct .  If the Company determines that the Participant has engaged in fraudulent or intentional misconduct related to or materially affecting the Company’s business operations or the Participant’s duties at the Company, the Committee may, in its discretion, based on the facts and circumstances surrounding the misconduct, direct the Company to withhold issuance of all or a portion of the shares granted pursuant to this Agreement, or if shares have been issued, to recover all or a portion of the shares from the Participant.

c.  
Recovery of Payout .  The Company reserves the right to recover a Restricted Stock Award payout pursuant to this Section 7 by (i) seeking recovery of the vested shares from the Participant; (ii) reducing the amount that would otherwise be payable to the Participant under another Company benefit plan or compensation program to the extent permitted by applicable law; (iii) withholding future annual and long-term incentive awards or salary increases; or (iv) taking any combination of these actions.

d.  
No Limitation on Remedies .   The Company’s right to recover Restricted Stock or issued stock  shares pursuant to this Section 7 shall be in addition to, and not in lieu of, actions the Company may take to remedy or discipline a Participant’s misconduct including, but not limited to, termination of employment or initiation of a legal action for breach of fiduciary duty.

e.  
Subject to Future Rulemaking . The Restricted Stock granted under this Agreement is subject to any claw back policies the Company may adopt in order to conform to the requirements of Section 954 of the Dodd-Frank Wall Street Reform and Consumer Protection Act and resulting rules issued by the Securities and Exchange Commission or national securities exchanges thereunder and that the Company determines should apply to said Restricted Stock .

 
8 .
Terms and Conditions .

a.  
Nontransferability .  Except as provided in Sections 4 and 5, the shares of Restricted Stock are not transferable and are subject to a substantial risk of forfeiture until the Vesting Date.

b.  
Stock Power .  As a condition of accepting this award, the Participant hereby assigns and transfers the shares of Restricted Stock granted pursuant to this Agreement to Dominion Resources, Inc., and hereby appoints Dominion Resources Services, Inc. as attorney to transfer such shares on its books.

c.  
Custody of Shares .  The Company will retain custody of the shares of Restricted Stock.

d.  
Shareholder Rights .  The Participant will have the right to receive dividends and will have the right to vote the shares of Restricted Stock awarded under Section 1, both vested and unvested.

e.  
Retirement .  For purposes of this Agreement, the term Retire or Retirement means a voluntary termination when the Participant is eligible for early or normal retirement benefits under the terms of the Dominion Pension Plan, or would be eligible if any crediting of deemed additional years of age or service applicable to the Participant under the Company’s Benefit Restoration Plan or New Benefit Restoration Plan was applied under the Pension Plan, as in effect at the time of the determination, unless the Company’s Chief Executive Officer determines, in his sole discretion, that the Participant’s retirement is detrimental to the Company.
 
f.  
Delivery of Shares.

(i)  
Share Delivery .  As soon as administratively feasible after the Vesting Date or after shares of Restricted Stock have become vested due to the occurrence of an event described in Section 4 or 5, the Company will deliver to the Participant (or in the event of the Participant’s death, the Participant’s Beneficiary) the appropriate number of shares of Company Stock.  The Company will also cancel the stock power covering such shares.  If the Participant has not designated a Beneficiary, the Participant’s spouse, if any, and if none the Participant’s estate shall be the Beneficiary.

(ii)  
Withholding of Taxes .  No Company Stock will be delivered until the Participant (or the Participant’s Beneficiary) has paid to the Company the amount that must be withheld under federal, state and local income and employment tax laws (the "Applicable Withholding Taxes") or the Participant and the Company have made satisfactory arrangements for the payment of such taxes.  Unless the Participant makes an alternative election, the Company will retain the number of shares of Restricted Stock (valued at their Fair Market Value) required to satisfy the Applicable Withholding Taxes.  As an alternative to the Company retaining shares, the Participant or the Participant’s Beneficiary may elect to (i) deliver Mature Shares (valued at their Fair Market Value) or (ii) make a cash payment to satisfy Applicable Withholding Taxes.

g.  
Fractional Shares .  Fractional shares of Company Stock will not be issued.

 
h.  
No Right to Continued Employment .  This Agreement does not confer upon the Participant any right with respect to continuance of employment by the Company or a Dominion Company, nor shall it interfere in any way with the right of the Company or a Dominion Company to terminate the Participant's employment at any time.

i.  
Change in Capital Structure .  The number and fair market value of shares of Restricted Stock awarded by this Agreement shall be automatically adjusted as provided in Section 15 of the Plan if the Company has a change in capital structure.

j.  
Governing Law .  This Agreement shall be governed by the laws of the Commonwealth of Virginia, other than its choice of law provisions.

k.  
Conflicts .  In the event of any conflict between the provisions of the Plan and the provisions of this Agreement, the provisions of the Plan shall govern.  All references in this Agreement to the Plan shall mean the plan as in effect on the Date of Grant.

l.  
Participant Bound by Plan .  By accepting this Agreement, Participant hereby acknowledges receipt of a copy of the Prospectus and Plan document accessible on the Company Intranet and agrees to be bound by all the terms and provisions thereof.

m.  
Binding Effect .  This Agreement shall be binding upon and inure to the benefit of the legatees, distributees, and personal representatives of the Participant and any successors of the Company.