PERSONAL AND CONFIDENTIAL M E M O R A N D U M

TO: Robert E. Rigsby

November 16, 2001

FROM: Anne M. Grier

Richmond, Virginia

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In accordance with the terms of the letter agreement dated September 15, 1995 you will be paid a lump sum severance equal to 6 months of your final base salary. This payment will equal $200,000, less applicable withholding taxes, and will be paid within 30 days of your retirement date.

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Severance Payment:    You will also receive a lump sum payment at retirement equal to one times your annual base salary, or $400,000, less applicable withholding taxes. This amount will be paid within 30 days of your retirement date.

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Stock Options:    You have 350,000 nonqualified stock options granted on May 17, 1999. These options are fully vested and exercisable. As additional consideration, you may exercise these options until their expiration date of May 17, 2009.

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Retirement Benefit Restoration Plan:    You will receive a benefit under the Company’s Retirement Benefit Restoration Plan calculated on the basis of age 60 and 30 years of credited service. As additional consideration, your benefit was also calculated using your final annual pay. If you elect a lump sum payment or a lump sum deferral to the Deferred Compensation Plan, this benefit will be paid, subject to approval by the Administrative Benefit Committee, within 30 days of the date of your retirement. Please see Attachment A for an explanation of this benefit and the associated election form.

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Executive Supplemental Retirement Plan:    Under the terms of the letter agreement dated April 16, 1999, you are entitled to a lifetime benefit under the Executive Supplemental Retirement Plan if your employment as an officer continues to the date of your 55^th birthday. As additional consideration, the age requirement for this benefit is being waived and you will receive a lifetime ESRP benefit as of your retirement date. If you elect a lump sum payment or a lump sum deferral to the Deferred Compensation Plan, this benefit will be paid or deferred, subject to approval by the Administrative Benefit Committee, within 30 days of the date of your retirement. Please see Attachment B for an explanation of this benefit and the associated election forms.

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Financial Planning Services:    You will receive Company-paid financial planning services for years 2002 and 2003 up to a maximum of $8,500 for each year. Please submit your approved invoices to Ray Hugo, 120 Tredegar Street, Richmond, Virginia 23219.

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COBRA Benefits (Dental & Vision):    Under the terms of the Consolidated Omnibus Budget Reconciliation Act (COBRA), you are eligible for continued coverage under the Company’s dental and vision benefit plans for 18 months or, if earlier, until you are covered by another group plan. After your retirement, you will automatically receive information containing the specifics of this program, along with the proper forms in order to elect continuation of coverage. Once you receive this material, it is very important that you read this information and respond within the stated guidelines, because there is only a limited amount of time to elect coverage under the COBRA provisions. If you do not receive this material by mid-February, please contact Phil Calhoun at ###-###-####. The 2002 monthly premium rates are as follows. As an additional benefit, if you elect this coverage, the Company will

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Stock Purchase and Loan Program:    You have an outstanding loan balance of $1,264,825 under the Company’s Executive Stock Purchase and Loan Program. You may continue to participate in the Program after your retirement, and you will continue to receive the Company’s interest rate subsidy for as long as you continue to hold the shares purchased with the loan. If you wish to cease your participation, the Company will pay for the prepayment fees and $500 administration fee, plus as additional consideration a gross up amount to cover any related income taxes on the fees. Please see Attachment D for a detailed explanation if you wish to cease your participation.

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Home Security System:    The company will continue to pay for and monitor your home security system through December 31, 2004.

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Restricted Stock:    You have 11,893 shares of restricted stock that will vest at the date of your retirement. The value of the shares on the vesting date (your retirement date) will be taxable income to you at that time. Applicable withholding taxes are due and payable immediately. Please see Attachment E for your choices with regard to the satisfaction of the withholding taxes and the disposition of the shares.

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Annual Incentive Bonus:     The 2001 incentive bonus will be paid at the same time as other executives and it will be based on Company performance. You will be paid $25,000 at retirement which equals 1/12 of your 2002 Target Award amount.

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Unused Vacation:    You will receive a payment in the amount of $ 64,616, less applicable withholding taxes, which represents 41days of unused 2001 and 2002 vacation.

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Qualified Retirement Plan:    You are eligible to receive a monthly benefit under the Dominion Resources Retirement Plan based upon your actual age at retirement (52.67 years of age), years of service to retirement date (22.67 years of service), salary (highest 60 consecutive months during the most recent 120 months), and estimated Social Security benefits. You cannot begin receiving a monthly benefit under this plan until you reach age 55. Once you reach age 55, you may elect to receive your monthly benefit in the form of either a straight life annuity, a joint & 50% survivor annuity, a joint & 100% survivor annuity, or a Social Security Leveling annuity. You do not have to begin your annuity at age 55; you may wait until a future

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Retiree Medical Plan:    You are entitled to medical coverage under the terms of the Company’s retiree medical plan as in effect from time to time and based on a retirement age of 60 and 30 years of credited service . Please see Attachment G for details about the current terms of the Company’s retiree medical plan and the election forms.

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Qualified Salaried Savings Plan:    Since you deferred a portion of your salary to the Savings Plan, you have an account balance available to you at retirement. This balance will include your contributions to the plan, company matching contributions, and earnings and/or losses associated with the investment elections you selected. After your retirement, no further contributions (either employee or employer contributions) can be made to your account. Your account will continue to earn investment income based upon your investment elections.

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Retiree Life Insurance:    The Company will purchase a whole life insurance policy on your behalf with a face amount of $300,000. This life insurance benefit equals 75% of your current annual base salary. The Company will make the premium payments of approximately $18,000 on an annual basis for seven years, after which time the policy will be fully paid-up. These annual premium payments will be taxable income to you, and will be reflected on a W-2 statement that will be issued by the Company to you each year.

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Company Car:    You may elect to receive your current Company car as a gift at retirement. The value of the car $ 34,465 will be taxable income to you. In lieu of the gift of the car, the Company will make a lump sum cash payment to you in the amount of $ 34,465, less applicable withholding taxes. Please see Attachment I to make your election.

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Deferred Compensation Plan:    You currently have a balance in your Deferred Compensation Plan account. In addition, you are eligible to receive the Company’s lost matching contribution to the Savings Plan due to the Internal Revenue Code Section 401(a)(17) limit for the plan year. A calculation will be done in January,

cc:    Raymond

 

M. Hugo

        Philip

 

H. Calhoun

        Personnel

 

File