On\ue000 February\ue000 18,\ue000 2009,\ue000 the\ue000 Board\ue000 of\ue000 Directors\ue000 (the\ue000 \u201cBoard\u201d)\ue000 of\ue000 Penn\ue000 Virginia\ue000 Corporation\ue000 (the\ue000 \u201cCompany\u201d)\ue000 approved\ue000 certain\ue000 changes\ue000 to the\ue000 Company\u2019s\ue000 director\ue000 compensation\ue000 policy.\ue000 The\ue000 changes\ue000 had\ue000 been\ue000 recommended\ue000 to\ue000 the\ue000 Board\ue000 by\ue000 its\ue000 Compensation\ue000 and\ue000 Benefits\ue000 Committee (the\ue000 \u201cC&B\ue000 Committee\u201d)\ue000 after\ue000 the\ue000 C&B\ue000 Committee\ue000 had\ue000 engaged\ue000 Hewitt\ue000 Associates\ue000 LLC,\ue000 its\ue000 independent\ue000 compensation\ue000 consultant,\ue000 to\ue000 complete a\ue000 review\ue000 of\ue000 director\ue000 compensation.\ue000 The\ue000 changes,\ue000 which\ue000 are\ue000 effective\ue000 as\ue000 of\ue000 January\ue000 1,\ue000 2009,\ue000 are\ue000 as\ue000 follows:

On\ue000 February\ue000 17,\ue000 2009,\ue000 the\ue000 C&B\ue000 Committee\ue000 approved\ue000 the\ue000 amendment\ue000 and\ue000 restatement\ue000 of\ue000 the\ue000 Company\u2019s\ue000 Fifth\ue000 Amended\ue000 and\ue000 Restated
1999\ue000 Employee\ue000 Stock\ue000 Incentive\ue000 Plan\ue000 (the\ue000 \u201cPlan\u201d).\ue000 The\ue000 Plan\ue000 was\ue000 amended\ue000 to\ue000 (i)\ue000 increase\ue000 the\ue000 number\ue000 of\ue000 shares\ue000 of\ue000 common\ue000 stock\ue000 of\ue000 the\ue000 Company
issuable\ue000 thereunder\ue000 from\ue000 5,200,000\ue000 to\ue000 8,000,000,\ue000 (ii)\ue000 provide\ue000 for\ue000 the\ue000 ability\ue000 of\ue000 the\ue000 C&B\ue000 Committee\ue000 to\ue000 grant\ue000 restricted\ue000 stock\ue000 units\ue000 and\ue000 (iii)\ue000 increase
the\ue000 aggregate\ue000 number\ue000 of\ue000 shares\ue000 of\ue000 restricted\ue000 stock\ue000 and\ue000 restricted\ue000 stock\ue000 units\ue000 issuable\ue000 thereunder\ue000 from\ue000 200,000\ue000 to\ue000 500,000.\ue000 The\ue000 amendments
described\ue000 in\ue000 clauses\ue000 (i)\ue000 and\ue000 (iii)\ue000 above\ue000 were\ue000 made\ue000 subject\ue000 to\ue000 shareholder\ue000 approval,\ue000 but\ue000 the\ue000 amendment\ue000 described\ue000 in\ue000 clause\ue000 (ii)\ue000 above\ue000 was\ue000 not
made\ue000 subject\ue000 to\ue000 shareholder\ue000 approval.\ue000 Consequently,\ue000 if\ue000 shareholder\ue000 approval\ue000 of\ue000 the\ue000 amendment\ue000 and\ue000 restatement\ue000 of\ue000 the\ue000 Plan\ue000 is\ue000 not\ue000 obtained,
the\ue000 amendments\ue000 described\ue000 in\ue000 clauses\ue000 (i)\ue000 and\ue000 (iii)\ue000 will\ue000 not\ue000 be\ue000 effective,\ue000 but\ue000 the\ue000 amendment\ue000 described\ue000 in\ue000 clause\ue000 (ii)\ue000 above\ue000 will\ue000 be\ue000 effective.\ue000 The
Company\ue000 intends\ue000 to\ue000 submit\ue000 the\ue000 amendments\ue000 described\ue000 in\ue000 clauses\ue000 (i)\ue000 and\ue000 (iii)\ue000 to\ue000 its\ue000 shareholders\ue000 for\ue000 approval\ue000 at\ue000 the\ue000 Company\u2019s\ue000 2009\ue000 Annual
Meeting\ue000 of\ue000 Shareholders\ue000 to\ue000 be\ue000 held\ue000 on\ue000 May\ue000 6,\ue000 2009.\ue000 In\ue000 connection\ue000 with\ue000 the\ue000 approval\ue000 of\ue000 the\ue000 ability\ue000 to\ue000 grant\ue000 restricted\ue000 stock\ue000 units,\ue000 the\ue000 C&B
Committee\ue000 approved\ue000 a\ue000 form\ue000 of\ue000 grant\ue000 agreement\ue000 for\ue000 restricted\ue000 stock\ue000 unit\ue000 awards\ue000 made\ue000 under\ue000 the\ue000 Plan.

As\ue000 provided\ue000 in\ue000 the\ue000 Plan\ue000 and\ue000 the\ue000 award\ue000 agreement,\ue000 each\ue000 restricted\ue000 stock\ue000 unit\ue000 entitles\ue000 the\ue000 grantee\ue000 to\ue000 receive\ue000 one\ue000 share\ue000 of\ue000 the\ue000 Company\u2019s
common\ue000 stock\ue000 upon\ue000 vesting,\ue000 which\ue000 occurs\ue000 over\ue000 a\ue000 three-year\ue000 period,\ue000 with\ue000 one-third\ue000 of\ue000 each\ue000 award\ue000 vesting\ue000 on\ue000 the\ue000 first,\ue000 second\ue000 and\ue000 third
anniversaries\ue000 of\ue000 the\ue000 grant\ue000 date\ue000 unless\ue000 (i)\ue000 the\ue000 restricted\ue000 stock\ue000 unitholder\u2019s\ue000 employment\ue000 terminates\ue000 for\ue000 any\ue000 reason\ue000 other\ue000 than\ue000 death\ue000 or\ue000 disability,
in\ue000 which\ue000 event\ue000 any\ue000 unvested\ue000 restricted\ue000 stock\ue000 units\ue000 are\ue000 forfeited\ue000 unless\ue000 otherwise\ue000 determined\ue000 by\ue000 the\ue000 C&B\ue000 Committee\ue000 and\ue000 specified\ue000 in\ue000 the\ue000 award

agreement,\ue000 or\ue000 (ii)\ue000 the\ue000 restricted\ue000 stock\ue000 unitholder\ue000 dies,\ue000 becomes\ue000 disabled\ue000 or\ue000 becomes\ue000 retirement\ue000 eligible,\ue000 which\ue000 is\ue000 defined\ue000 as\ue000 reaching\ue000 age\ue000 62\ue000 and
completing\ue000 10\ue000 years\ue000 of\ue000 consecutive\ue000 service\ue000 with\ue000 the\ue000 Company\ue000 or\ue000 its\ue000 affiliate,\ue000 or\ue000 there\ue000 occurs\ue000 a\ue000 change\ue000 in\ue000 control\ue000 of\ue000 the\ue000 Company,\ue000 in\ue000 which
events\ue000 all\ue000 restrictions\ue000 terminate.\ue000 Payments\ue000 of\ue000 the\ue000 restricted\ue000 stock\ue000 unit\ue000 awards\ue000 will\ue000 be\ue000 made\ue000 in\ue000 shares\ue000 (or,\ue000 at\ue000 the\ue000 request\ue000 of\ue000 the\ue000 restricted\ue000 stock
unitholder\ue000 and\ue000 upon\ue000 the\ue000 approval\ue000 of\ue000 C&B\ue000 Committee,\ue000 an\ue000 amount\ue000 of\ue000 cash\ue000 equal\ue000 to\ue000 the\ue000 fair\ue000 market\ue000 value\ue000 of\ue000 the\ue000 Company\u2019s\ue000 common\ue000 stock)\ue000 at\ue000 the
time\ue000 of\ue000 vesting,\ue000 unless\ue000 vesting\ue000 occurs\ue000 early\ue000 on\ue000 account\ue000 of\ue000 becoming\ue000 retirement\ue000 eligible,\ue000 in\ue000 which\ue000 event\ue000 payments\ue000 will\ue000 be\ue000 made\ue000 when\ue000 such
restricted\ue000 stock\ue000 units\ue000 would\ue000 have\ue000 originally\ue000 vested,\ue000 even\ue000 if\ue000 that\ue000 is\ue000 after\ue000 retirement.\ue000 The\ue000 restricted\ue000 stock\ue000 unitholder\ue000 is\ue000 also\ue000 entitled\ue000 to\ue000 dividend

On\ue000 February\ue000 18,\ue000 2009,\ue000 the\ue000 Board\ue000 of\ue000 Directors\ue000 of\ue000 the\ue000 Company\ue000 approved\ue000 amendments\ue000 to\ue000 Article\ue000 5\ue000 of\ue000 the\ue000 Company\u2019s\ue000 Amended\ue000 and
Restated\ue000 Bylaws\ue000 (the\ue000 \u201cBylaws\ue000 Amendment\u201d)\ue000 to\ue000 clarify\ue000 provisions\ue000 regarding\ue000 indemnification\ue000 and\ue000 advancement\ue000 of\ue000 expenses\ue000 to\ue000 directors\ue000 and
officers\ue000 of\ue000 the\ue000 Company.\ue000 The\ue000 Bylaws\ue000 Amendment\ue000 clarifies\ue000 that\ue000 both\ue000 the\ue000 indemnification\ue000 and\ue000 advancement\ue000 of\ue000 expenses\ue000 provisions\ue000 apply\ue000 to
current\ue000 and\ue000 former\ue000 directors\ue000 and\ue000 officers\ue000 of\ue000 the\ue000 Company\ue000 and\ue000 that\ue000 both\ue000 such\ue000 rights\ue000 are\ue000 vested\ue000 upon\ue000 a\ue000 person\u2019s\ue000 election\ue000 to\ue000 the\ue000 Board\ue000 of
Directors\ue000 of\ue000 the\ue000 Company\ue000 or\ue000 as\ue000 an\ue000 officer\ue000 of\ue000 the\ue000 Company.