<PAGE>
   
    AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON FEBRUARY 2, 1996
    

                                                       REGISTRATION NO. 33-65079

                       SECURITIES AND EXCHANGE COMMISSION

                             WASHINGTON, D.C. 20549

   
                                AMENDMENT NO. 1
    

   
                                       TO
    

                                    FORM S-3

                             REGISTRATION STATEMENT

                                     UNDER

                           THE SECURITIES ACT OF 1933

                             UNIVERSAL CORPORATION

             (Exact name of registrant as specified in its charter)


<TABLE>
<S>                                                               <C>
     COMMONWEALTH OF VIRGINIA                                           54-0414210
   (State or other jurisdiction                                      (I.R.S. employer
of incorporation or organization)                                 identification number)
</TABLE>


                           1501 NORTH HAMILTON STREET
                            RICHMOND, VIRGINIA 23230
                                 (804) 359-9311

         (Address, including zip code, and telephone number, including
            area code, of registrant's principal executive offices)

                              JAMES M. WHITE, III
                         SECRETARY AND GENERAL COUNSEL
                             UNIVERSAL CORPORATION
                           1501 NORTH HAMILTON STREET
                            RICHMOND, VIRGINIA 23230
                                 (804) 359-9311

           (Name, address, including zip code, and telephone number,
                   including area code, of agent for service)

                                   COPIES TO:


<TABLE>
<S>                                         <C>
             CRAIG H. WEBER                      ROBERT H. CRAFT, JR.
 MCGUIRE, WOODS, BATTLE & BOOTHE, L.L.P           SULLIVAN & CROMWELL
 ONE JAMES CENTER, 901 EAST CARY STREET     1701 PENNSYLVANIA AVENUE, N.W.
        RICHMOND, VIRGINIA 23219                WASHINGTON, D.C. 20006
</TABLE>


        APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO THE PUBLIC:
   From time to time after the effective date of this registration statement.

   
    THE REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH DATE OR
DATES AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANT SHALL
FILE A FURTHER AMENDMENT WHICH SPECIFICALLY STATES THAT THIS REGISTRATION
STATEMENT SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH SECTION 8(A) OF
THE SECURITIES ACT OF 1933 OR UNTIL THIS REGISTRATION STATEMENT SHALL BECOME
EFFECTIVE ON SUCH DATE AS THE COMMISSION, ACTING PURSUANT TO SAID SECTION 8(A)
MAY DETERMINE.
    


<PAGE>
   
                                  $200,000,000
    

                                [UNIVERSAL LOGO]

                                DEBT SECURITIES

     Universal Corporation (the "Company") may offer, from time to time, its
debt securities consisting of debentures, notes and/or other evidences of
indebtedness (the "Debt Securities"), at an aggregate issue price not to exceed
$200,000,000 (or the equivalent in foreign denominated currencies or units of
two or more currencies, based on the applicable exchange rate at the time of
offering, as shall be designated by the Company at the time of offering). The
Debt Securities may be offered as separate series, and may be offered in
amounts, at prices and on terms to be determined at the time of the offering.
Each issue of Debt Securities may vary, where applicable, as to aggregate
principal amount, maturity date, public offering or purchase price, interest
rate or rates and timing of payments thereof, provision for redemption or
sinking fund requirements, if any, currencies of denomination or currencies
otherwise applicable thereto and any other variable terms and methods of
distribution. The specific terms with regard to the Debt Securities in respect
of which this Prospectus is being delivered are set forth in one or more
accompanying Prospectus Supplements (each a "Prospectus Supplement").

     The Debt Securities will be unsecured and will rank equally with all other
unsecured and unsubordinated indebtedness of the Company.

     The Debt Securities may be issued in registered form ("Registered
Securities") or bearer form with coupons attached ("Bearer Securities"), or
both. In addition, all or a portion of the Debt Securities of a series may be
issuable in temporary or permanent global form. Bearer Debt Securities, Debt
Securities represented by a permanent global Debt Security exchangeable for
Bearer Debt Securities and Debt Securities initially represented by a temporary
global Debt Security described under "Description of Debt
Securities -- Temporary Global Securities" (collectively, "Euro-Securities") are
offered only to Non-United States persons and to offices of certain United
States financial institutions located outside the United States and its
possessions. See "Limitations on Issuance of Euro-Securities." For a discussion
of certain United States federal income tax consequences to Holders of Debt
Securities, see "United States Taxation."

THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
     EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE
        SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES
        COMMISSION PASSED UPON THE ACCURACY OR ADEQUACY OF THIS
          PROSPECTUS. ANY   REPRESENTATION TO THE CONTRARY IS A
                               CRIMINAL OFFENSE.

     The Debt Securities may be sold directly by the Company, or indirectly
through agents designated from time to time or through underwriters or dealers,
or through a combination of such methods. See "Plan of Distribution." If any
agents of the Company or any underwriters or dealers are involved in the sale of
the Debt Securities, the names of such agents, underwriters or dealers and any
applicable commissions or discounts will also be set forth in the Prospectus
Supplement. The net proceeds to the Company from such sale will be set forth in
the Prospectus Supplement.

   
               THE DATE OF THIS PROSPECTUS IS FEBRUARY   , 1996.
    


<PAGE>
                             AVAILABLE INFORMATION

     The Company is subject to the informational requirements of the Securities
Exchange Act of 1934, as amended (the "Exchange Act"), and in accordance
therewith files reports and other information with the Securities and Exchange
Commission (the "Commission"). Such reports, proxy statements and other
information can be inspected and copied at the public reference room of the
Commission at Judiciary Plaza, 450 Fifth Street, N.W., Washington, D.C. 20549,
and at the following regional offices of the Commission: Seven World Trade
Center, Suite 1300, New York, New York 10048, and Citicorp Center, 500 West
Madison Street, Suite 1400, Chicago, Illinois 60661. Copies of such material can
be obtained by mail from the Public Reference Section of the Commission at 450
Fifth Street, N.W., Washington, D.C. 20549, at prescribed rates. The Company's
Common Stock is listed on the New York Stock Exchange, and such reports, proxy
statements and other information concerning the Company may be inspected at the
offices of the New York Stock Exchange, Inc., 20 Broad Street, New York, New
York 10005.

     This Prospectus does not contain all the information set forth in the
registration statement to which this Prospectus relates (the "Registration
Statement") and the exhibits thereto which the Company has filed with the
Commission under the Securities Act of 1933, as amended (the "Securities Act"),
and to which reference is hereby made.

                INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE

     The following documents filed by the Company with the Commission (File No.
1-652) are incorporated herein by reference:

     1. The Company's Annual Report on Form 10-K for the fiscal year ended June
        30, 1995;

   
     2. The Company's Quarterly Report on Form 10-Q (as amended by Form 10-Q/A)
        for the quarter ended September 30, 1995; and
    

     3. The Company's Current Report on Form 8-K bearing a cover date of July
        11, 1995.

     All documents subsequently filed by the Company pursuant to Sections 13(a),
13(c), 14 or 15(d) of the Exchange Act prior to the termination of the offering
of the Debt Securities shall be deemed to be incorporated by reference into this
Prospectus and to be a part hereof from the respective dates of filing of such
documents.

     Any statement contained herein or in a document all or any portion of which
is incorporated or deemed to be incorporated by reference herein shall be deemed
to be modified or superseded for purposes of this Prospectus to the extent that
a statement contained herein or in any other subsequently filed document which
also is or is deemed to be incorporated by reference herein modifies or
supersedes such statement. Any statement so modified or superseded shall not be
deemed, except as so modified or superseded, to constitute a part of the
Registration Statement or this Prospectus.

     The Company will provide without charge to any person to whom this
Prospectus is delivered, upon the written or oral request of such person, a copy
of any or all of the foregoing documents incorporated herein by reference (other
than certain exhibits to such documents). Requests for such copies should be
directed to Karen M. L. Whelan, Vice President and Treasurer, Universal
Corporation, 1501 North Hamilton Street, Richmond, Virginia 23230, telephone
number (804) 359-9311.

                                  THE COMPANY

     The Company, through its subsidiaries, is the world's largest independent
leaf tobacco merchant and has additional operations in agri-products and lumber
and building products. The Company's tobacco operations have been the principal
focus of the Company since its founding in 1918, and for the fiscal year ended
June 30, 1995, such operations accounted for 70% of revenues and 75% of
operating profits. The Company's agri-products and lumber and building products
operations accounted for 14% and 16% of revenues and 9% and 16% of operating
profits, respectively, during the same period.

     The Company was incorporated under the laws of the Commonwealth of Virginia
in 1918. The Company's principal executive offices are located at 1501 North
Hamilton Street, Richmond, Virginia 23230, telephone (804) 359-9311.
 
                                       2
 

<PAGE>
                       RATIO OF EARNINGS TO FIXED CHARGES
 
     The table below sets forth the ratio of earnings to fixed charges for the
periods indicated. For purposes of calculating the ratio, earnings consist of
the sum of (i) pretax income from continuing consolidated operations and
unconsolidated affiliates, excluding the effects of discontinued operations,
extraordinary items and the cumulative effect of accounting changes and (ii)
fixed charges. Fixed charges consist of interest costs for the Company and its
unconsolidated affiliates and the amortization of debt discounts.
 

<TABLE>
<CAPTION>
                                                       THREE MONTHS
                                                           ENDED
                                                       SEPTEMBER 30,               YEAR ENDED JUNE 30,
                                                       1995     1994     1995     1994     1993     1992     1991
<S>                                                    <C>      <C>      <C>      <C>      <C>      <C>      <C>
Ratio of Earnings to Fixed Charges.................    2.0x     1.4x     1.8x     1.9x     3.1x     2.8x     2.4x
</TABLE>

 
                                USE OF PROCEEDS
 
     Except as may be set forth in a Prospectus Supplement, the Company intends
to use the net proceeds from the sale of the Debt Securities for general
corporate purposes, which may include repayment of indebtedness, capital
expenditures, possible acquisitions and working capital. Pending such use, the
net proceeds may be temporarily invested or applied to the reduction of
indebtedness.
 
                         DESCRIPTION OF DEBT SECURITIES
 
     The Debt Securities will be issued under an Indenture dated as of February
1, 1991 (the "Indenture") between the Company and Chemical Bank, as Trustee (the
"Trustee"). A copy of the Indenture has been filed as an exhibit to the
Registration Statement of which this Prospectus is a part. The statements under
this caption, as modified or superseded by the applicable Prospectus Supplement,
are brief summaries of certain provisions of the Indenture, do not purport to be
complete, and are subject to, and are qualified in their entirety by reference
to, all of the provisions of the Indenture. Wherever particular Sections or
defined terms of the Indenture are referred to, such Sections or defined terms
are incorporated herein by reference.
 
     The term "Securities," as used in this Prospectus, refers to all Securities
issued under the Indenture and includes the Debt Securities. Unless otherwise
indicated, currency amounts in this Prospectus and any Prospectus Supplement are
stated in United States dollars ("$" or "dollars").
 
     The Securities may be issued from time to time in one or more series. The
particular terms of each series of Securities offered by a Prospectus Supplement
or Prospectus Supplements will be described in such Prospectus Supplement or
Prospectus Supplements relating to such series.
 
     The Indenture limits the ability of the Company to incur certain secured
indebtedness and to engage in certain sale and leaseback transactions. See
"Restrictions on Liens" and "Restrictions on Sale and Leaseback Transactions"
below. There is no restriction in the Securities or the Indenture against the
incurring of indebtedness by the Company or any subsidiary of the Company. The
Debt Securities will be obligations exclusively of the Company. The Company is a
holding company, substantially all of whose consolidated assets are held by its
subsidiaries. Accordingly, the cash flow of the Company and the consequent
ability to service its debt, including the Debt Securities, are largely
dependent upon the cash flow and earnings of such subsidiaries.
 
GENERAL
 
     The Indenture will provide that, in addition to Securities previously
issued thereunder, additional Securities may be issued in separate series
thereunder without limitation as to aggregate principal amount. The terms of
each series of Securities will be established by or pursuant to a resolution of
the Board of Directors of the Company and set forth or determined in the manner
provided in an Officers' Certificate or by a supplemental indenture. (Section
301)
 
     The applicable Prospectus Supplement or Prospectus Supplements will
describe the following terms of the Securities of each series: (1) the title of
the Securities; (2) any limit on the aggregate principal amount of the
Securities; (3) whether the Securities are to be issuable as Registered
Securities or Bearer Securities or both, whether any of the Securities are to be
issuable initially in temporary global form and whether any of the Securities
are to be issuable in permanent global form; (4) the price or prices (expressed
as a percentage of the aggregate principal amount thereof) at which the
Securities will be
 
                                       3
 

<PAGE>
issued; (5) the date or dates on which the Securities will mature; (6) the rate
or rates per annum at which the Securities will bear interest, if any, or the
formula pursuant to which such rate or rates will be determined, and the date or
dates from which any such interest will accrue; (7) the Interest Payment Dates
on which any such interest on the Securities will be payable and the Regular
Record Date for any interest payable on any Registered Securities on any
Interest Payment Date; (8) the Person to whom any Registered Securities of such
series will be payable, if other than the Person in whose name that Security (or
one or more Predecessor Securities) is registered at the close of business on
the Regular Record Date for such interest, the manner in which, or the Person to
whom, any interest on any Bearer Security of such series will be payable, if
otherwise than upon presentation and surrender of the coupons appertaining
thereto, and the extent to which, or the manner in which, any interest payable
on a temporary global Security on an Interest Payment Date will be paid if other
than in the manner described under "Global Securities -- Temporary Global
Securities" below and the extent to which, or the manner in which, any interest
payable on a permanent global Security on an Interest Payment Date will be paid;
(9) each office or agency where, subject to the terms of the Indenture as
described below under "Payment and Paying Agents," the principal of and any
premium and interest on the Securities will be payable and each office or agency
where, subject to the terms of the Indenture as described below under "Form,
Exchange, Registration and Transfer," the Securities may be presented for
registration of transfer or exchange; (10) the period or periods within which
and the price or prices at which the Securities may, pursuant to any optional
redemption provisions, be redeemed, in whole or in part, and the other detailed
terms and provisions of any such optional redemption provisions; (11) the
obligation, if any, of the Company to redeem or purchase the Securities pursuant
to any sinking fund or analogous provisions or at the option of the Holder
thereof and the period or periods within which and the price or prices at which
the Securities will be redeemed or purchased, in whole or in part, pursuant to
such obligation, and the other detailed terms and provisions of such obligation;
(12) the denominations in which any Registered Securities will be issuable, if
other than denominations of $1,000 and any integral multiple thereof, and the
denomination or denominations in which Bearer Securities will be issuable, if
other than denominations of $5,000; (13) the currency or currency units of
payment of principal of and any premium and interest on the Securities; (14) any
index used to determine the amount of payments of principal of and any premium
and interest on the Securities; (15) any limitation on the application of the
terms of the Indenture described below under "Defeasance and Covenant
Defeasance;" and (16) any other terms of the Securities not inconsistent with
the provisions of the Indenture. (Section 301) Any such Prospectus Supplement or
Prospectus Supplements will also describe any special provisions for the payment
of additional amounts relating to specified taxes, assessments or other
governmental charges in respect of the Securities of such series and whether the
Company has the option to redeem the affected Securities rather than pay such
additional amounts.
 
     Securities may be issued as Original Issue Discount Securities. An Original
Issue Discount Security is a Security, including any zero-coupon Security, which
is issued at a price lower than the amount payable upon the Stated Maturity
thereof, and which provides that, upon redemption or acceleration of the
Maturity thereof, an amount less than the amount payable upon the Stated
Maturity thereof and determined in accordance with the terms of such Security
shall become due and payable. Special United States federal income tax
considerations applicable to Securities issued at an original issue discount,
including Original Issue Discount Securities, and special United States tax
considerations applicable to any Securities which are denominated in a currency
or currency unit other than United States dollars are described below under
"United States Taxation -- United States Holders -- Original Issue Discount."
 
     The Securities of each series will be unsecured and will rank pari passu
with all other unsecured and unsubordinated indebtedness of the Company.
 
   
     The Indenture does not contain any provisions which may afford the Holders
of Securities of any series protection in the event of a highly leveraged
transaction or other transaction which may occur in connection with a takeover
attempt resulting in a decline in the credit rating of the Securities. Any such
provisions, if applicable to the Securities of any series, will be described in
the Prospectus Supplement or Prospectus Supplements relating thereto.
    
 
FORM, EXCHANGE, REGISTRATION AND TRANSFER
 
     Securities of a series may be issuable in definitive form solely as
Registered Securities, solely as Bearer Securities or as both Registered
Securities and Bearer Securities. Unless otherwise indicated in an applicable
Prospectus Supplement or Prospectus Supplements, Bearer Securities in definitive
form will have interest coupons attached. The Indenture also will provide that
Securities of a series may be issuable in temporary or permanent global form.
(Section 201) See "Global Securities -- Temporary Global Securities" and "Global
Securities -- Permanent Global Securities."
 
     In connection with its sale during the Restricted Period (as defined in
Section 1.163-5(c)(2)(i)(D)(7) of the United States Treasury Regulations), no
Euro-Security shall be delivered to any location in the United States or its
possessions. Except as
 
                                       4
 

<PAGE>
may otherwise be provided in the applicable Prospectus Supplement, a
Euro-Security (not including a Security in temporary global form) may be
delivered in connection with its sale during the Restricted Period only if the
person entitled to physical delivery of such Euro-Security furnishes written
certification, in the form required by the Indenture, to the effect that (i)
such Euro-Security is not owned or being acquired by or on behalf of a United
States person (as defined under "Limitations on Issuance of Euro-Securities"),
(ii) such Euro-Security is owned or being acquired by or on behalf of (A) a
United States person that is a financial institution within the meaning of
Section 1.165-12(c)(1)(v) of the United States Treasury Regulations (a
"Financial Institution") purchasing for its own account or for resale or (B) a
United States person who acquired such Euro-Security through the foreign branch
of a United States Financial Institution and who holds such Euro-Security
through such Financial Institution on the date of such written certification
(and, in either case (A) or (B), the Financial Institution has agreed to comply
with the requirements of Section 165(j)(3)(A), (B) or (C) of the Internal
Revenue Code of 1986, as from time to time amended, and the regulations
thereunder), or (iii) such Euro-Security is owned or is being acquired by a
Financial Institution for the purpose of resale during the Restricted Period. A
Financial Institution described in clause (iii) above, whether or not also
described in clause (i) or (ii) above, must certify that it has not acquired the
Euro-Security for purposes of resale directly or indirectly to a United States
person or to a person within the United States or its possessions. In the case
of a Euro-Security in permanent global form, such certification must be given in
connection with the notation of a beneficial owner's interest therein upon
original issuance of such Security or upon exchange of a portion of a temporary
global Security. (Section 303) See "Global Securities -- Temporary Global
Securities" and "Limitations on Issuance of Euro-Securities."
 
     At the option of the Holder, subject to the terms of the Indenture,
Registered Securities of any series will be exchangeable for other Registered
Securities of the same series of any authorized denominations and of a like
aggregate principal amount and tenor. In addition, if Securities of any series
are issuable as both Registered Securities and Bearer Securities, at the option
of the Holder, subject to the terms of the Indenture, Bearer Securities (with
all unmatured coupons, except as provided below, and with all matured coupons in
default) of such series will be exchangeable for Registered Securities of the
same series of any authorized denominations and of a like aggregate principal
amount and tenor. Bearer Securities surrendered in exchange for Registered
Securities between a Regular Record Date or a Special Record Date and the
relevant date for payment of interest shall be surrendered without the coupon
relating to such date for payment of interest and interest will not be payable
in respect of the Registered Security issued in exchange for such Bearer
Security, but will be payable only to the Holder of such coupon when due in
accordance with the terms of the Indenture. Registered Securities, including
Registered Securities received in exchange for Bearer Securities, may not be
exchanged for Bearer Securities. (Section 305) Each Bearer Security and coupon
will bear a legend to the following effect: "Any United States person who holds
this obligation will be subject to limitations under the United States income
tax laws, including the limitations provided in Sections 165(j) and 1287(a) of
the Internal Revenue Code." (Section 201)
 
     Securities may be presented for exchange as provided above, and Registered
Securities may be presented for registration of transfer (with the form of
transfer endorsed thereon duly executed), at the office of the Security
Registrar or at the office of any transfer agent designated by the Company for
such purpose with respect to any series of Securities and referred to in an
applicable Prospectus Supplement or Prospectus Supplements, without a service
charge and upon payment of any taxes and other governmental charges as described
in the Indenture. Such transfer or exchange will be effected upon the Security
Registrar or such transfer agent, as the case may be, being satisfied with the
documents of title and identity of the person making the request. The Company
has appointed the Trustee as Security Registrar. (Section 305) If a Prospectus
Supplement or Prospectus Supplements refer to any transfer agents (in addition
to the Security Registrar) initially designated by the Company with respect to
any series of Securities, the Company may at any time rescind the designation of
any such transfer agent or approve a change in the location through which any
such transfer agent acts, except that, if Securities of a series are issuable
solely as Registered Securities, the Company will be required to maintain a
transfer agent in each Place of Payment for such series and, if Securities of a
series are issuable as Bearer Securities, the Company will be required to
maintain (in addition to the Security Registrar) a transfer agent in a Place of
Payment for such series located outside the United States and its possessions.
The Company may at any time designate additional transfer agents with respect to
any series of Securities. (Section 1002)
 
     In the event of any redemption in part, the Company shall not be required
to (i) issue, register the transfer of or exchange any Security during a period
beginning at the opening of business 15 days before any selection for redemption
of Securities of like tenor and of the series of which such Security is a part,
and ending at the close of business on the earliest date on which the relevant
notice of redemption is deemed to have been given to all Holders of Securities
of like tenor and of such series to be redeemed; (ii) register the transfer of
or exchange any Registered Security so selected for redemption, in whole or in
part, except the unredeemed portion of any Security being redeemed in part; or
(iii) exchange any Bearer Security so
 
                                       5
 

<PAGE>
selected for redemption, except to exchange such Bearer Security for a
Registered Security of that series and like tenor which is immediately
surrendered for redemption. (Section 305)
 
PAYMENT AND PAYING AGENTS
 
     Unless otherwise indicated in an applicable Prospectus Supplement or
Prospectus Supplements, principal of and any premium and interest on Bearer
Securities will be payable, subject to any applicable laws and regulations, at
the offices of such Paying Agents outside the United States and its possessions
as the Company may designate from time to time or, at the option of the Holder,
by check or by transfer to an account maintained by the payee with a financial
institution located outside the United States and its possessions. Unless
otherwise indicated in an applicable Prospectus Supplement or Prospectus
Supplements, payment of interest on a Bearer Security on any Interest Payment
Date will be made only against surrender to the Paying Agent of the coupon
relating to such Interest Payment Date. (Section 1001) No payment with respect
to any Bearer Security will be made at any office or agency of the Company in
the United States or its possessions or by check mailed to any address in the
United States or its possessions or by transfer to any account maintained with a
financial institution located in the United States or its possessions.
Notwithstanding the foregoing, payments of principal of and any premium and
interest on Bearer Securities denominated and payable in U.S. dollars will be
made at the office of the Paying Agent in the Borough of Manhattan, The City of
New York, if (but only if) payment of the full amount thereof in U.S. dollars at
all offices or agencies outside the United States and its possessions is illegal
or effectively precluded by exchange controls or other similar restrictions.
(Section 1002)
 
     Unless otherwise indicated in an applicable Prospectus Supplement or
Prospectus Supplements, principal of and any premium and interest on Registered
Securities will be payable, subject to any applicable laws and regulations, at
the office of such Paying Agent or Paying Agents as the Company may designate
from time to time, except that at the option of the Company payment of any
interest may be made by check mailed to the address of the Person entitled
thereto as such address shall appear in the Security Register. Unless otherwise
indicated in an applicable Prospectus Supplement or Prospectus Supplements,
payment of interest on a Registered Security on any Interest Payment Date will
be made to the Person in whose name such Registered Security (or Predecessor
Security) is registered at the close of business on the Regular Record Date for
such interest. (Section 307)
 
     Unless otherwise indicated in an applicable Prospectus Supplement or
Prospectus Supplements, the Corporate Trust Office of the Trustee in The City of
New York will be designated as a Paying Agent for the Company for payments with
respect to Securities of each series which are issuable solely as Registered
Securities and as a Paying Agent for payments with respect to Securities of each
series (subject to the limitations described above in the case of Bearer
Securities) which are issuable solely as Bearer Securities or as both Registered
Securities and Bearer Securities. Any Paying Agents outside the United States
and its possessions and any other Paying Agents in the United States or its
possessions initially designated by the Company for the Securities of each
series will be named in an applicable Prospectus Supplement or Prospectus
Supplements. The Company may at any time designate additional Paying Agents or
rescind the designation of any Paying Agent or approve a change in the office
through which any Paying Agent acts, except that if Securities of a series are
issuable solely as Registered Securities, the Company will be required to
maintain a Paying Agent in each Place of Payment for such series and, if
Securities of a series are issuable as Bearer Securities, the Company will be
required to maintain (i) a Paying Agent in the Borough of Manhattan, The City of
New York for payments with respect to any Registered Securities of the series
(and for payments with respect to Bearer Securities of the series in the
circumstances described above, but not otherwise), and (ii) a Paying Agent in a
Place of Payment located outside the United States and its possessions where
Securities of such series and any coupons appertaining thereto may be presented
and surrendered for payment; provided, however, that if the Securities of such
series are listed on The International Stock Exchange of the United Kingdom and
the Republic of Ireland, Limited (the "London Stock Exchange"), the Luxembourg
Stock Exchange or any other stock exchange located outside the United States and
its possessions and such stock exchange shall so require, the Company will
maintain a Paying Agent in London, Luxembourg or any other required city located
outside the United States and its possessions, as the case may be, for the
Securities of such series. (Section 1002)
 
     All moneys paid by the Company to a Paying Agent for the payment of the
principal of and any premium or interest on any Security of any series which
remain unclaimed at the end of two years after such principal, premium or
interest shall have become due and payable will be repaid to the Company and the
Holder of such Security or any coupon appertaining thereto will thereafter look
only to the Company for payment thereof. (Section 1003)
 
                                       6


<PAGE>
GLOBAL SECURITIES

     DEPOSITARY GLOBAL SECURITIES

     If so specified in an applicable Prospectus Supplement or Prospectus
Supplements, the Debt Securities of a series will be issued in book-entry form
and will be evidenced by a single permanent global Security (the "Depositary
Global Security") which will be deposited with, or on behalf of, the Depository
Trust Company, as Depositary (the "Depositary"), located in the Borough of
Manhattan, The City of New York, and will be registered in the name of the
Depositary or a nominee of the Depositary.

     The specific terms of the depositary arrangement with respect to a series
of Debt Securities evidenced by a Depositary Global Security will be described
in the Prospectus Supplement relating to such series. Unless otherwise specified
in the applicable Prospectus Supplement, the Company anticipates that the
following provisions will apply to depositary arrangements.

     Ownership of beneficial interests in a Depositary Global Security will be
limited to institutions that have accounts with the Depositary ("participants")
or persons that may hold interests through participants. In addition, ownership
of beneficial interests in Depositary Global Securities by persons that hold
through participants will only be evidenced by, and the transfer of that
ownership interest within such participant will be effected only through,
records maintained by such participant. The laws of some jurisdictions require
that certain purchasers of securities take physical delivery of such securities
in definitive form. Such laws may impair the ability to transfer beneficial
interests in a Depositary Global Security.

     Upon the issuance of a series of Debt Securities evidenced by a Depositary
Global Security, and the deposit of such Depositary Global Security with the
Depositary, the Depositary will immediately credit, on its book-entry
registration and transfer system, the respective principal amounts of the Debt
Securities evidenced by such Depositary Global Security to the accounts of
participants. The initial accounts to be credited shall be designated by the
Underwriters of such series of Debt Securities.

     Payments of principal of and interest on a series of Debt Securities
evidenced by a Depositary Global Security will be made by the Company through
Chemical Bank, as Paying Agent or such other paying agent named in the
Prospectus Supplement, to the Depositary or its nominee, as the case may be, as
the registered owner and the Holder of the Depositary Global Security. None of
the Company, the Trustee or any agent of the Company or the Trustee will have
any responsibility or liability for any aspect of the Depositary's records or
any participant's records relating to or payments made on account of Depositary
Global Securities or for maintaining, supervising or reviewing any of the
Depositary's records or any participant's records relating to such Depositary
Global Securities.

     The Company expects that the Depositary for a series of Debt Securities
evidenced by a Depositary Global Security or its nominee, upon receipt of any
payment of principal of or interest in respect of any such Depositary Global
Security, will immediately credit, on its book-entry registration and transfer
system, accounts of participants with payment in amounts proportionate to their
respective beneficial interests in the principal amount of such Depositary
Global Security as shown on the records of the Depositary. Payments by
participants to owners of beneficial interests in such Depositary Global
Security held through such participants will be governed by standing
instructions and customary practices, as is now the case with securities held
for the accounts of customers registered in "street name," and will be the
responsibility of such participants.

     The Depositary Global Security evidencing a series of Debt Securities may
not be transferred except as a whole by the Depositary for such Depositary
Global Security to a nominee of such Depositary or by a nominee of such
Depositary to such Depositary or another nominee of such Depositary or by such
Depositary or any such nominee to a successor of the Depositary or a nominee of
such successor.

     Unless otherwise specified in the applicable Prospectus Supplement, a
Depositary Global Security evidencing a series of Debt Securities will be
exchangeable for definitive Securities in registered form, of like tenor and of
an equal aggregate principal amount, only if (x) the Depositary notifies the
Company that it is unwilling or unable to continue as Depositary for such
Depositary Global Security or if at any time the Depositary ceases to be a
clearing agency registered under the Exchange Act, (y) the Company in its sole
discretion determines that the Depositary Global Securities shall be
exchangeable for definitive Securities in registered form or (z) any event shall
have happened and be continuing which, after notice or lapse of time, or both,
would become an Event of Default with respect to the Debt Securities of a series
evidenced by a Depositary Global Security. In the event that the Depositary
Global Security evidencing a series of Debt Securities is exchangeable pursuant
to the preceding sentence, it shall be exchangeable in whole for definitive
Securities in registered form, of like tenor

                                       7


<PAGE>
and of an equal aggregate principal amount, in denominations of $1,000 and
integral multiples thereof. Such definitive Securities shall be registered in
the name or names of such person or persons as the Depositary shall instruct the
Security Registrar. It is expected that such instructions may be based upon
directions received by the Depositary from its participants with respect to
ownership of beneficial interests in the Depositary Global Securities.

     Except as provided above or in the applicable Prospectus Supplement, owners
of beneficial interests in Depositary Global Securities will not be entitled to
receive physical delivery of Securities in definitive form and will not be
considered the Holders thereof for any purpose under such Securities or the
Indenture, and the Depositary Global Security evidencing a series of Debt
Securities will not be exchangeable, except for another Depositary Global
Security of like denomination and tenor to be registered in the name of the
Depositary or its nominee. Accordingly, each person owning a beneficial interest
in a Depositary Global Security must rely on the procedures of the Depositary
for such Depositary Global Security and, if such person is not a participant, on
the procedures of the participant through which such person owns its interest,
to exercise any rights of a Holder under such Securities or the Indenture. The
Indenture allows the Depositary, as a Holder, to appoint agents and otherwise
authorize participants to give or take any request, demand, authorization,
direction, notice, consent, waiver or other action which a Holder is entitled to
give or take under the Indenture. The Company understands that under existing
industry practices, in the event that the Company requests any action of Holders
or an owner of a beneficial interest in a Depositary Global Security desires to
give or take any action a Holder is entitled to give or take under such
Securities or the Indenture, the Depositary would authorize the participants
owning beneficial interests in the relevant Depositary Global Security to give
or take such action, and such participants would authorize beneficial owners
owning through such participants to give or take such action or would otherwise
act upon the instructions of beneficial owners owning through them.

     The Depositary has advised the Company that the Depositary is a
limited-purpose trust company organized under the laws of the State of New York,
a member of the Federal Reserve System, a "clearing corporation" within the
meaning of the New York Uniform Commercial Code, and a "clearing agency"
registered under the Exchange Act. The Depositary was created to hold securities
of its participants and to facilitate the clearance and settlement of securities
transactions among its participants in such securities through electronic
book-entry changes in accounts of the participants, thereby eliminating the need
for physical movement of securities certificates. The Depositary's participants
include securities brokers and dealers (including the Underwriters), banks,
trust companies, clearing corporations, and certain other organizations, some of
whom (and/or their representatives) own interests in the Depositary. Access to
the Depositary's book-entry system is also available to others, such as banks,
brokers, dealers and trust companies that clear through or maintain a custodial
relationship with a participant, either directly or indirectly.

     TEMPORARY GLOBAL SECURITIES

     If so specified in an applicable Prospectus Supplement or Prospectus
Supplements, all or any portion of the Securities of a series issuable as Bearer
Securities will initially be represented by one or more temporary global
Securities, without interest coupons, to be deposited with Morgan Guaranty Trust
Company of New York, Brussels Office, as the operator of the Euroclear System
(the "Euroclear Operator") and CEDEL S.A. ("CEDEL") for credit to the designated
accounts. On and after the date determined as provided in any such temporary
global Security and described in an applicable Prospectus Supplement or
Prospectus Supplements (the "Exchange Date"), each such temporary global
Security will be exchanged for definitive Bearer Securities, definitive
Registered Securities or all or a portion of a permanent global Security, or any
combination thereof, as specified in an applicable Prospectus Supplement or
Prospectus Supplements, but, unless otherwise specified in an applicable
Prospectus Supplement or Prospectus Supplements, only upon receipt by the
Company of written certification in the form and to the effect described above
under "Form, Exchange, Registration and Transfer." No Security delivered in
exchange for any portion of a temporary global Security shall be delivered to
any location in the United States or its possessions in connection with such
exchange. (Section 304)

     Unless otherwise specified in an applicable Prospectus Supplement or
Prospectus Supplements, interest in respect of any portion of a temporary global
Security payable in respect of an Interest Payment Date occurring prior to the
issuance of definitive Securities (including a permanent global Security) will
be paid to each of the Euroclear Operator and CEDEL with respect to the portion
of the temporary global Security held for its account for which it provides
certification in the form described in the Indenture. Each of the Euroclear
Operator and CEDEL will undertake in such circumstances to credit such interest
received by it in respect of a temporary global Security to the respective
accounts for which it holds such temporary global Security, and for which it has
received written certification that, as of the relevant Interest Payment Date,
is in the form and to the effect described above under "Form, Exchange,
Registration and Transfer." Receipt of such certification shall be deemed to be
a request for an interest in a permanent global Security (unless the account
holder requests that such portion be exchanged for a definitive Registered
Security or Securities or a definitive Bearer Security or Securities). If an
Interest

                                       8


<PAGE>
Payment Date occurs prior to the issuance of definitive Securities (including a
permanent global Security) but on or after the Exchange Date, written
certification in the form and to the effect described above under "Form,
Exchange, Registration and Transfer" will also be required to obtain an interest
payment, and upon receipt of such certificate the Euroclear Operator or CEDEL,
as the case may be, will exchange the portion of the temporary global Security
relating to such certification for an interest in a permanent global Security
(unless the account holder requests that such portion be exchanged for a
definitive Registered Security or Securities or a definitive Bearer Security or
Securities).

     PERMANENT GLOBAL SECURITIES

     If any Securities of a series are issuable in permanent global form, the
applicable Prospectus Supplement or Prospectus Supplements will describe the
circumstances, if any, under which beneficial owners of interests in any such
permanent global Security may exchange such interests for Securities of such
series and of like tenor and principal amount in any authorized form and
denomination. No Bearer Security delivered in exchange for any portion of a
permanent global Security shall be delivered to any location in the United
States or its possessions in connection with such exchange. (Section 305)
Principal of and any premium and interest on any permanent global Security will
be payable in the manner described in the applicable Prospectus Supplement or
Prospectus Supplements.

CERTAIN DEFINITIONS

     For purposes of the Indenture covenants described below:

     "CONSOLIDATED NET TANGIBLE ASSETS" means shareholders' equity as set forth
on the most recent consolidated balance sheet of Universal Leaf and its
subsidiaries as prepared in accordance with generally accepted accounting
principles less all intangible amounts representing goodwill, trade names,
trademarks and patents.

     "DEBT" means all indebtedness for money borrowed and capitalized leases and
any guarantee of such obligations.

     "FUNDED DEBT" means all Debt maturing more than one year after the date of
determination and all Debt, regardless of term, renewable by the obligor for
more than one year after the date of its creation which would, in accordance
with generally accepted accounting principles, be classified as long-term debt.

     "LIEN" means any mortgage, lien, pledge, charge, security interest or
encumbrance of any kind (other than purchase options, rights of first refusal
and other arrangements pursuant to which capital stock or property may be sold).

     "PRINCIPAL PROPERTY" means, with respect to any Person, (i) any capital
stock of a subsidiary of Universal Leaf owned by such Person and (ii) any
manufacturing, packing or processing plant or facility of any character or any
warehouse or any other storage facility of any character owned or leased under a
capitalized lease by such Person and all land and fixtures related thereto, the
gross book value (without deduction of any depreciation reserves) of which
capital stock, plant, facility or warehouse on the date as of which the
determination is being made exceeds 1% of Consolidated Net Tangible Assets,
other than any such capital stock, plant, facility or warehouse or portion
thereof which, in the opinion of the Boards of Directors of the Company and of
Universal Leaf, is not of material importance to the total business conducted by
the Restricted Subsidiaries taken together with all other capital stock, plants,
facilities and warehouses previously so declared.

     "RESTRICTED SUBSIDIARIES" means Universal Leaf Tobacco Company,
Incorporated, Universal Leaf Tobacco Company, Incorporated's subsidiaries and
their respective successors, including, without limitation, transferees of their
Principal Property which are Affiliates of the Company and/or Universal Leaf,
but excluding any subsidiaries organized under any jurisdiction other than the
United States of America (including the States and the District of Columbia) or
Brazil of which less than 66-2/3% of the Voting Stock is owned, directly or
indirectly, by Universal Leaf, and "RESTRICTED SUBSIDIARY" means any one of the
Restricted Subsidiaries.

     "SUBSIDIARY" means a corporation or business trust, a majority of the
Voting Stock of which is owned by the Company and/or its subsidiaries.

     "UNIVERSAL LEAF" means Universal Leaf Tobacco Company, Incorporated, a
Virginia corporation, and any Affiliate of the Company and/or Universal Leaf
with which it shall consolidate or into which it shall merge or to which it
shall transfer 40% or more of its consolidated assets. (Section 101)

RESTRICTIONS ON LIENS

     The Indenture will provide that the Company will not, and will not permit
any Restricted Subsidiary to, create, or suffer to exist, any Lien upon any
Principal Property of any Restricted Subsidiary or upon any capital stock of
Universal Leaf,

                                       9


<PAGE>
whether owned on the date of the Indenture or thereafter acquired, without
making effective, concurrent provision whereby all Outstanding Securities shall
be directly secured, equally and ratably with the indebtedness or other claims
or obligations (the "Indebtedness") secured by one or more Liens; PROVIDED,
HOWEVER, that this restriction will not apply, among other things, to: (i) Liens
existing on the date of the Indenture; (ii) Liens securing Indebtedness owing by
any Restricted Subsidiary to another Restricted Subsidiary; (iii) Liens existing
on any asset or shares of capital stock of any corporation at the time such
corporation becomes a subsidiary of any Restricted Subsidiary or is merged into
or consolidated with any Restricted Subsidiary; (iv) Liens on any asset securing
Indebtedness incurred or assumed or guaranteed for the purpose of financing all
or any part of the cost of acquiring, constructing, improving or repairing such
asset (including, without limitation, Liens incurred in connection with
pollution control bonds, industrial revenue bonds or similar financings),
PROVIDED THAT such Liens attach within 120 days of the completion of the
acquisition, construction, improvement or repair thereof (or in the case of real
property, completion of such improvement or construction or commencement of full
operation of such property, whichever is later); (v) Liens existing on any asset
prior to the acquisition thereof by any Restricted Subsidiary; (vi) Liens on any
assets in favor of the United States of America (including the States and the
District of Columbia) or any other country (or any department, agency,
instrumentality or political subdivision thereof) and created to secure any
payments pursuant to any contract or statute, PROVIDED THAT payment thereof is
not at the time required by the Indenture; (vii) Liens arising pursuant to any
statute or order of attachment, distraint or similar legal process arising in
connection with court proceedings so long as the execution or other enforcement
thereof is effectively stayed and the claims secured thereby are being contested
in good faith by appropriate proceedings; (viii) Liens securing taxes,
assessments or governmental charges not yet delinquent or being contested in
good faith by appropriate proceedings; (ix) Liens securing obligations owing to
landlords, mechanics, materialmen, suppliers, carriers and other like Persons
incurred in the ordinary course of business for sums not yet due or being
contested in good faith by appropriate proceedings; and (x) Liens arising out of
the refinancing, extension, renewal or refunding of any Indebtedness secured by
any Lien permitted by the foregoing clauses, PROVIDED THAT such Indebtedness is
not increased and is not secured by any additional assets. Notwithstanding the
foregoing, Liens on Principal Property of the Restricted Subsidiaries are
permitted, without complying with the foregoing restrictions, in an aggregate
amount (including the value of any sale and leaseback transaction permitted by
clause (i) of the next paragraph by virtue of this sentence, but excluding the
value of (i) sale and leaseback transactions otherwise permitted by the next
paragraph and (ii) Liens permitted by clauses (i) through (x) of the preceding
sentence of this paragraph) not at the time exceeding 10% of Consolidated Net
Tangible Assets. (Section 1008) At September 30, 1995, Consolidated Net Tangible
Assets were approximately $197 million. The Indenture will not prohibit the sale
by the Company of any stock or indebtedness of the Restricted Subsidiaries.

RESTRICTIONS ON SALE AND LEASEBACK TRANSACTIONS

     The Indenture will also provide that the Company will not, and will not
permit any Restricted Subsidiary to, enter into any arrangement, directly or
indirectly, with any Person whereby such Restricted Subsidiary shall sell or
transfer any Principal Property of such Restricted Subsidiary, whether owned on
the date of the Indenture or thereafter acquired, more than 120 days after the
completion of construction and commencement of full operation thereof, and then
or thereafter rent or lease as lessee for a term of more than three years such
property or any part thereof or any other property which such Restricted
Subsidiary intends to use for substantially the same purpose or purposes as the
Principal Property being sold or transferred, unless (i) a Lien would be
permitted (without securing all Outstanding Securities) under the provisions of
the immediately preceding paragraph in an amount equal to the value of such sale
and leaseback transaction; (ii) the sale and leaseback transaction is between
such Restricted Subsidiary and the Company or another Subsidiary; or (iii)
within 180 days of such sale and leaseback transaction, the Company or such
Restricted Subsidiary applies an amount equal to the greater of (a) the fair
value of such property as determined in good faith by the Boards of Directors of
Universal Leaf and of the Company, or (b) the proceeds from the sale of such
property, to (x) the purchase or acquisition (or, in the case of real property,
the construction) of assets by any Restricted Subsidiary or (y) to the voluntary
retirement of Funded Debt of the Company or any Restricted Subsidiary (which may
include the Securities), other than Funded Debt that is subordinated in right of
payment to the Securities. For purposes of clause (i) of the preceding sentence
and for purposes of the preceding paragraph, the value of any sale and leaseback
transaction shall be an amount equal to the greater of the amounts specified in
clauses (iii) (a) and (iii) (b) of the preceding sentence, in either case first
divided by the number of years in the original lease term and then multiplied by
the number of years of such term remaining at the time of determination.
(Section 1009)

CONSOLIDATION, MERGER, SALE AND LEASE OF ASSETS

     The Company may, without the consent of the Holders of any of the
Outstanding Securities of a series, consolidate with, merge into or transfer or
lease its assets substantially as an entirety to any corporation organized under
the laws of any domestic jurisdiction, PROVIDED THAT (i) the successor
corporation assumes the Company's obligations on the Securities of

                                       10


<PAGE>
each series and under the Indenture, (ii) after giving effect thereto, no Event
of Default, and no event which, after notice or lapse of time, would become an
Event of Default shall have occurred and be continuing, and (iii) certain other
conditions are met. (Sections 801, 802)

EVENTS OF DEFAULT

     The following are Events of Default under the Indenture with respect to
Securities of any series: (a) failure to pay principal of or any premium on any
of the Securities of that series when due; (b) failure to pay any interest on
any Security of that series when due, continued for 30 days; (c) failure to
deposit any sinking fund payment, if applicable, when due, in respect of any
Security of that series; (d) failure to perform any other covenant of the
Company in the Indenture (other than a covenant included in the Indenture solely
for the benefit of a series of Securities other than that series) continued for
60 days after written notice as provided in the Indenture; (e) certain events of
bankruptcy, insolvency or reorganization of the Company; and (f) any other Event
of Default provided with respect to Securities of that series. (Section 501)
Subject to the provisions of the Indenture, the Trustee will be under no
obligation to exercise any of its rights or powers under the Indenture at the
request or direction of any of the Holders of Securities of any series or any
related coupons unless such Holders shall have offered to the Trustee reasonable
indemnity. (Sections 601, 603) Subject to such provisions for the
indemnification of the Trustee, the Holders of a majority in aggregate principal
amount of the Outstanding Securities of any series shall have the right to
direct the time, method and place of conducting any proceeding for any remedy
available to the Trustee, or exercising any trust or power conferred on the
Trustee, with respect to Securities of that series. (Section 512)

     If an Event of Default with respect to Securities of any series at the time
Outstanding shall occur and be continuing, either the Trustee or the Holders of
at least 25% in aggregate principal amount of the Outstanding Securities of that
series may declare the principal of all such Outstanding Securities, or, if any
such Securities are Original Issue Discount Securities, such lesser amount as
may be described in an applicable Prospectus Supplement or Prospectus
Supplements, of all the Securities of that series to be due and payable
immediately. At any time after a declaration of acceleration with respect to
Securities of any series has been made but before a judgment or decree for
payment of money due has been obtained by the Trustee, the Holders of a majority
in aggregate principal amount of Outstanding Securities of that series may
rescind any declaration of acceleration and its consequences, if all payments
due (other than those due as a result of acceleration) have been made and all
Events of Default have been cured or waived. (Section 502)

     No Holder of any Securities of any series or any related coupons shall have
any right to institute any proceeding with respect to the Indenture or for any
remedy thereunder, unless such Holder shall have previously given to the Trustee
written notice of a continuing Event of Default with respect to Securities of
that series, the Holders of at least 25% in aggregate principal amount of the
Outstanding Securities of that series shall have made written request, and
offered reasonable indemnity, to the Trustee to institute such proceeding as
trustee, and the Trustee shall not have received from the Holders of a majority
in aggregate principal amount of the Outstanding Securities of that series a
direction inconsistent with such request and shall have failed to institute such
proceeding within 60 days. However, such limitations do not apply to a suit
instituted by a Holder of an Outstanding Security of that series for enforcement
of payment of the principal of, or any premium or interest on, such Security on
or after the respective due dates expressed in such Security. (Sections 507,
508)

     The Company is required to furnish to the Trustee annually a statement as
to performance or fulfillment of covenants, agreements or conditions in the
Indenture and as to the absence of default. (Section 1004)

MEETINGS, MODIFICATION AND WAIVER

     Modifications and amendments of the Indenture may be made by the Company
and the Trustee with the consent of the Holders of not less than a majority in
aggregate principal amount of the Outstanding Securities of each series affected
by such modification or amendment; provided, however, that no such modification
or amendment may, without the consent of the Holder of each Outstanding Security
affected thereby (a) change the Stated Maturity of the principal of, or any
installment of principal of or interest on any Security, (b) reduce the
principal amount of, or premium or interest on, any Security, (c) change any
obligation of the Company to pay additional amounts, (d) reduce the amount of
principal of an Original Issue Discount Security payable upon acceleration of
the Maturity thereof, (e) change the coin or currency in which any Security or
any premium or interest thereon is payable, (f) impair the right to institute
suit for the enforcement of any payment on or with respect to any Security, (g)
reduce the percentage in principal amount of Outstanding Securities of any
series, the consent of whose Holders is required for modification or amendment
of the Indenture or for waiver of compliance with certain provisions of the
Indenture or for waiver of certain defaults, (h) reduce the requirements
contained in the Indenture for quorum or

                                       11


<PAGE>
voting, (i) change any obligation of the Company to maintain an office or agency
in the places and for the purposes required by the Indenture, or (j) modify any
of the above provisions. (Section 902)

     The Holders of not less than a majority in aggregate principal amount of
the Outstanding Securities of a series may, on behalf of all Holders of
Securities of that series and any coupons appertaining thereto, waive any past
default under the Indenture with respect to Securities of that series, except a
default (a) in the payment of principal of or any premium or interest on any
Security of such series or (b) in respect of a covenant or provision of the
Indenture which cannot be modified or amended without the consent of the Holder
of each Outstanding Security of such series affected. (Section 513)

     The Indenture provides that in determining whether the Holders of the
requisite principal amount of the Outstanding Securities have given any request,
demand, authorization, direction, notice, consent or waiver thereunder or are
present at a meeting of Holders of Securities for quorum purposes, (i) the
principal amount of an Original Issue Discount Security that shall be deemed to
be Outstanding shall be the amount of the principal thereof that would be due
and payable as of the date of such determination upon acceleration of the
Maturity thereof, and (ii) the principal amount of a Security denominated in a
foreign currency or currency unit shall be the U.S. dollar equivalent,
determined on the date of original issuance of such Security, of the principal
amount of such Security or, in the case of an Original Issue Discount Security,
the U.S. dollar equivalent, determined on the date of original issuance of such
Security, of the amount determined as provided in (i) above. (Section 101)

     The Indenture contains provisions for convening meetings of the Holders of
Securities of any or all series. (Article Thirteen) A meeting may be called at
any time by the Trustee, and also, upon request, by the Company or the Holders
of at least 10% in aggregate principal amount of the Outstanding Securities of
such series, in any such case upon notice given in accordance with "Notices"
below. (Section 1302) Except for any consent which must be given by the Holder
of each Outstanding Security affected thereby, as described above, any
resolution presented at a meeting at which a quorum is present may be adopted by
the affirmative vote of the Holders of a majority in principal amount of the
Outstanding Securities of that series; PROVIDED, HOWEVER, that, except for any
consent which must be given by the Holder of each Outstanding Security affected
thereby, as described above, any resolution with respect to any consent, waiver,
request, demand, notice, authorization, direction or other action which may be
given by the Holders of not less than a specified percentage in principal amount
of the Outstanding Securities of a series may be adopted at a meeting at which a
quorum is present only by the affirmative vote of the Holders of not less than
such specified percentage in principal amount of the Outstanding Securities of
that series. Any resolution passed or decision taken at any meeting of Holders
of Securities of any series duly held in accordance with the Indenture will be
binding on all Holders of Securities of that series and the related coupons. The
quorum at any meeting called to adopt a resolution will be Persons holding or
representing a majority in principal amount of the Outstanding Securities of a
series; PROVIDED, HOWEVER, that if any action is to be taken at such meeting
with respect to a consent, waiver, request, demand, notice, authorization,
direction or other action which may be given by the Holders of not less than a
specified percentage in principal amount of the Outstanding Securities of a
series, the Persons holding or representing such specified percentage in
principal amount of the Outstanding Securities of such series will constitute a
quorum for that purpose. (Section 1304)

NOTICES

     Except as otherwise provided in the Indenture, notices to Holders of Bearer
Securities will be given by publication at least twice in a daily newspaper of
general circulation in The City of New York and in such other city or cities as
may be specified in such Securities. Notices to Holders of Registered Securities
will be given by mail to the addresses of such Holders as they appear in the
Security Register. (Sections 101, 106)

TITLE

     Title to any Bearer Securities (including Bearer Securities in temporary
global form and in permanent global form) and any coupons appertaining thereto
will pass by delivery. The Company, the Trustee and any agent of the Company or
the Trustee may treat the bearer of any Bearer Security and the bearer of any
coupon and the registered owner of any Registered Security as the absolute owner
thereof (whether or not such Security or coupon shall be overdue and
notwithstanding any notice to the contrary) for the purpose of making payment
and for all other purposes. (Section 308)

REPLACEMENT OF SECURITIES AND COUPONS

     Any mutilated Security or a Security with a mutilated coupon appertaining
thereto will be replaced by the Company at the expense of the Holder upon
surrender of such Security to the Trustee. Securities or coupons that become
destroyed, lost or

                                       12


<PAGE>
stolen will be replaced by the Company at the expense of the Holder upon
delivery to the Trustee of evidence of the destruction, loss or theft thereof
satisfactory to the Company and the Trustee; in the case of any coupon which
becomes destroyed, lost or stolen, such coupon will be replaced by issuance of a
new Security in exchange for the Security to which such coupon appertains. In
the case of a destroyed, lost or stolen Security or coupon, an indemnity
satisfactory to the Trustee and the Company may be required at the expense of
the Holder of such Security or coupon before a replacement Security will be
issued. (Section 306)

DEFEASANCE AND COVENANT DEFEASANCE

     Unless otherwise indicated in the applicable Prospectus Supplement, the
Company may elect either (i) to defease and be discharged from any and all
obligations with respect to the Securities of any series (except as otherwise
provided in the Indenture) ("defeasance") or (ii) to be released from its
obligations with respect to certain covenants applicable to such Securities,
including its obligations described above under "Certain Covenants" ("covenant
defeasance"), upon the deposit with the Trustee (or other qualifying trustee),
in trust for such purpose, of money and/or U.S. Government Obligations which
through the payment of principal and interest in accordance with their terms
will provide money in an amount sufficient, without reinvestment, to pay the
principal of and any premium or interest on such Securities to Maturity or
redemption, as the case may be, and any mandatory sinking fund or analogous
payments thereon. As a condition to defeasance or covenant defeasance, the
Company must deliver to the Trustee an Opinion of Counsel to the effect that the
Holders of such Securities will not recognize income, gain or loss for United
States federal income tax purposes as a result of such defeasance or covenant
defeasance and will be subject to United States federal income tax on the same
amounts, in the same manner and at the same times as would have been the case if
such defeasance or covenant defeasance had not occurred. Such Opinion of
Counsel, in the case of defeasance under clause (i) above, must refer to and be
based upon a ruling of the Internal Revenue Service or a change in applicable
United States federal income tax law occurring after the date of the Indenture.
(Article Fourteen)

     The Company may exercise its defeasance option with respect to such
Securities notwithstanding its prior exercise of its covenant defeasance option.
If the Company exercises its defeasance option, payment of such Securities may
not be accelerated because of an Event of Default. If the Company exercises its
covenant defeasance option, payment of such Securities may not be accelerated by
reference to the covenant noted under clause (ii) above. However, if such
acceleration were to occur, the realizable value at the acceleration date of the
money and U.S. Government Obligations in the defeasance trust could be less than
the principal and interest then due on such Securities, in that the required
deposit in the defeasance trust is based upon scheduled cash flows rather than
market value, which will vary depending upon interest rates and other factors.

GOVERNING LAW

     The Indenture, the Securities and the coupons will be governed by, and
construed in accordance with, the laws of the State of New York. (Section 113)

CONCERNING THE TRUSTEE

     The Company and certain of its subsidiaries may from time to time maintain
lines of credit, and have other customary banking relationships, with Chemical
Bank, the Trustee under the Indenture.

                                       13


<PAGE>
                   LIMITATIONS ON ISSUANCE OF EURO-SECURITIES

     United States tax laws and regulations impose certain restrictions on the
issuance of any securities in bearer form. Except as may otherwise be provided
in the Prospectus Supplement applicable thereto, in accordance with the federal
tax laws and regulations of the United States, Euro-Securities may not, in
connection with their offer or sale during the Restricted Period (as defined
above under "Description of Debt Securities -- Form, Exchange, Registration and
Transfer"), be offered or sold, directly or indirectly, (i) to any person in the
United States or its possessions (as defined below), or (ii) to any United
States person (as defined below) other than (x) an office located outside the
United States or its possessions of a Financial Institution (as defined above
under "Description of Debt Securities -- Form, Exchange, Registration and
Transfer") purchasing for its own account or for the account of a customer,
provided that such Financial Institution agrees in writing to comply with the
requirements of Section 165(j)(3)(A), (B), or (C) of the Internal Revenue Code
of 1986, as amended, and the regulations thereunder or (y) otherwise as
permitted by United States Treasury Regulation Section 1.163-5(c)(2)(i)(D). Any
underwriters, agents and dealers participating in the offering of Debt
Securities must covenant that they will not offer or sell during the Restricted
Period any Euro-Securities to any person in the United States or its possessions
or to any United States person (other than (x) an office located outside the
United States and its possessions of a Financial Institution or (y) otherwise as
permitted by United States Treasury Regulation Section 1.163-5(c)(2)(i)(D)), and
that they will not deliver Euro-Securities within the United States or its
possessions.

     In addition, any such underwriters, agents and dealers must covenant that
they have in effect procedures reasonably designed to ensure that their
employees or agents who are directly engaged in selling Euro-Securities are
aware of the above restrictions on the offer or sale of Euro-Securities.
Moreover, Bearer Securities (including a permanent global Debt Security) and any
coupons appertaining thereto will not be delivered in definitive form or, if
prior to delivery in definitive form, interest will not be paid on any
Euro-Securities, unless the Company has received a signed certificate in writing
(or an electronic certificate described in United States Treasury Regulation
Section 1.163-5(c)(2)(i)(D)(3)(ii)) in the form and to the effect described
above under "Description of Debt Securities -- Form, Exchange, Registration and
Transfer." Bearer Securities (including a permanent global Debt Security) and
coupons will bear a legend to the following effect: "Any United States person
who holds this obligation will be subject to limitations under the United States
income tax laws, including the limitations provided in Section 165(j) and
1287(a) of the Internal Revenue Code." The sections referred to in such legend
provide that a United States person (other than a Financial Institution or a
United States person holding through a Financial Institution) who holds a Bearer
Security or coupon will not be allowed to deduct any loss realized on the sale,
exchange or redemption of such Bearer Security or coupon and any gain (which
might otherwise be characterized as capital gain) recognized on such sale,
exchange or redemption will be treated as ordinary income.

     As used herein, "United States person" means a citizen or resident of the
United States, a corporation, partnership or other entity created or organized
in or under the laws of the United States and an estate or trust the income of
which is subject to United States federal income taxation regardless of its
source. "United States" means the United States of America (including the States
and the District of Columbia) and "possessions" of the United States include
Puerto Rico, the U.S. Virgin Islands, Guam, American Samoa, Wake Island and
Northern Mariana Islands.

                             FOREIGN CURRENCY RISKS

     Debt Securities denominated or payable in foreign currencies may entail
significant risks. These risks include, without limitation, the possibility of
significant fluctuations in the foreign currency markets. These risks will vary
depending upon the currency or currencies involved and will be more fully
described in the Prospectus Supplement relating thereto.

                             UNITED STATES TAXATION

   
     The following is a summary of the principal United States federal income
tax consequences of ownership of Debt Securities. The summary represents the
opinion of McGuire, Woods, Battle & Boothe, L.L.P., special tax counsel to the
Company, insofar as the statements contained therein are or refer to statements
of United States law or legal conclusions relating thereto. It deals only with
Debt Securities held as capital assets, and not with special classes of holders,
such as dealers in securities or currencies, banks, tax-exempt organizations,
life insurance companies, persons that hold Debt Securities that are part of a
hedge or that are hedged against currency risks or that are part of a straddle
or conversion transaction, or persons whose functional currency is not the U.S.
dollar. It also does not deal with Holders other than original purchasers.
Moreover, the summary deals only with Debt Securities that are due to mature 30
years or less from the date on which they are issued. The United States federal
income tax consequences of ownership of Debt Securities that are due to mature
more
    

                                       14


<PAGE>
than 30 years from their date of issue will be discussed in an applicable
Prospectus Supplement. The summary is based on the Internal Revenue Code of
1986, as amended (the "Code"), its legislative history, existing and proposed
regulations thereunder, judicial decisions, and published rulings and other
administrative guidance issued by the Internal Revenue Service (the "Service"),
as currently in effect, all of which are subject to change at any time, possibly
with retroactive effect.

     Prospective purchasers of Debt Securities should consult their own tax
advisors concerning the consequences of ownership of Debt Securities, in their
particular circumstances, under the Code and the laws of State, local or foreign
taxing jurisdiction.

UNITED STATES HOLDERS

     PAYMENTS OF INTEREST

     Except as provided below under " -- Original Issue Discount," interest on a
Debt Security (including "qualified stated interest" on a "Discount Debt
Security," as defined below) will be taxable to a United States Holder as
ordinary income at the time it is received or accrued, depending on the holder's
method of accounting for tax purposes. A United States Holder is a beneficial
owner who or that is (i) a citizen or resident of the United States, (ii) a
domestic corporation or (iii) otherwise subject to United States federal income
taxation on a net income basis in respect of the Debt Security.

     If an interest payment is denominated in, or determined by reference to, a
currency, composite currency or basket of currencies other than the U.S. dollars
(a "foreign currency"), the amount of income recognized by a cash basis United
States Holder will be the U.S. dollar value of the interest payment, based on
the exchange rate in effect on the date of receipt, regardless of whether the
payment is in fact converted into U.S. dollars.

     An accrual basis United States Holder may determine the amount of income
recognized with respect to an interest payment denominated in, or determined by
reference to, a foreign currency in accordance with either of two methods. Under
the first method, the amount of income accrued will be based on the average
exchange rate in effect during the interest accrual period (or, with respect to
an accrual period that spans two taxable years, the part of the period within
the taxable year).

     Under the second method, the United States Holder may elect to determine
the amount of income accrued on the basis of the exchange rate in effect on the
last day of the accrual period or, in the case of an accrual period that spans
two taxable years, the exchange rate in effect on the last day of the part of
the period within the taxable year. Additionally, if a payment of interest is
actually received within five business days of the last day of the accrual
period or taxable year, an electing accrual basis United States Holder may
instead translate such accrued interest into U.S. dollars at the exchange rate
in effect on the day of actual receipt. Any such election will apply to all debt
instruments held by the United States Holder at the beginning of the first
taxable year to which the election applies or thereafter acquired by the United
States Holder, and will be irrevocable without the consent of the Service.

     Upon receipt of the interest payment (including a payment attributable to
accrued but unpaid interest upon the sale or retirement of a Debt Security)
denominated in, or determined by reference to, a foreign currency, the United
States Holder will recognize ordinary income or loss measured by the difference
between (x) the average exchange rate used to accrue interest income, or the
exchange rate as determined under the second method described above if the
United States Holder elects that method, and (y) the exchange rate in effect on
the date of receipt, regardless of whether the payment is in fact converted into
U.S. dollars.

     ORIGINAL ISSUE DISCOUNT

     GENERAL. A Debt Security with a maturity of more than one year from the
date of issue will be treated as issued at an original issue discount (a
"Discount Debt Security") if the excess of its "stated redemption price at
maturity" over its issue price is more than a "de minimis amount" (as defined
below). Generally, the issue price of a Debt Security will be the first price at
which a substantial amount of Debt Securities included in the issue of which the
Debt Security is a part is sold to other than bond houses, brokers, or similar
persons or organizations acting in the capacity of underwriters, placement
agents, or wholesalers. The stated redemption price at maturity of a Debt
Security is the total of all payments provided by the Debt Security that are not
payments of "qualified stated interest." A qualified stated interest payment
generally is any one of a series of stated interest payments on a Debt Security
that are unconditionally payable at least annually at a single fixed rate (with
certain exceptions for lower rates paid during some periods) applied to the
outstanding principal amount of the Debt Security. Special rules for determining
qualified stated interest payable on certain Debt Securities bearing interest at
a variable rate are described below under " -- Variable Rate Debt Securities."

                                       15


<PAGE>
     In general, if the excess of a Debt Security's stated redemption price at
maturity over its issue price is less than 1/4 of 1 percent of the Debt
Security's stated redemption price at maturity multiplied by the number of
complete years to its maturity (the "de minimis amount"), then such excess, if
any, constitutes "de minimis original issue discount" and the Debt Security is
not a Discount Debt Security. Unless the election described below under
"Election to Treat All Interest as Original Issue Discount" is made, a United
States Holder of a Debt Security with de minimis original issue discount must
include such de minimis original issue discount in income as stated principal
payments on the Debt Security are made. The includible amount with respect to
each such payment will equal the product of the total amount of the Debt
Security's de minimis original issue discount and a fraction, the numerator of
which is the amount of the principal payment made and the denominator of which
is the stated principal amount of the Debt Security.

     United States Holders of Discount Debt Securities having a maturity of more
than one year from their date of issue must, generally, include original issue
discount ("OID") in income calculated on a constant-yield method before the
receipt of cash attributable to such income, and generally will have to include
in income increasingly greater amounts of OID over the life of the Debt
Security. The amount of OID includible in income by a United States Holder of a
Discount Debt Security is the sum of the daily portions of OID with respect to
the Discount Debt Security for each day during the taxable year or portion of
the taxable year on which the United States Holder holds such Discount Debt
Security ("accrued OID"). The daily portion is determined by allocating to each
day in any "accrual period" a pro rata portion of the OID allocable to that
accrual period. Accrual periods with respect to a Debt Security may be of any
length selected by the United States Holder and may vary in length over the term
of the Debt Security as long as (i) no accrual period is longer than one year
and (ii) each scheduled payment of interest or principal on the Debt Security
occurs on either the final or first day of an accrual period. The amount of OID
allocable to an accrual period equals the excess of (a) the product of the
Discount Debt Security's adjusted issue price at the beginning of the accrual
period and such Debt Security's yield to maturity (determined on the basis of
compounding at the close of each accrual period and properly adjusted for the
length of the accrual period) over (b) the sum of the payments of qualified
stated interest on the Debt Security allocable to the accrual period. The
"adjusted issue price" of a Discount Debt Security at the beginning of any
accrual period is the issue price of the Debt Security increased by (x) the
amount of accrued OID for each prior accrual period and decreased by (y) the
amount of any payments previously made on the Debt Security that were not
qualified stated interest payments. For purposes of determining the amount of
OID allocable to an accrual period, if an interval between payments of qualified
stated interest on the Debt Security contains more than one accrual period, the
amount of qualified stated interest payable at the end of the interval
(including any qualified stated interest that is payable on the first day of the
accrual period immediately following the interval) is allocated pro rata on the
basis of relative lengths of each accrual period in the interval, and the
adjusted issue price at the beginning of each accrual period in the interval
must be increased by the amount of any qualified stated interest that has
accrued prior to the first day of the accrual period but that is not payable
until the end of the interval. The amount of OID allocable to an initial short
accrual period may be computed using any reasonable method if all other accrual
periods other than a final short accrual period are of equal length. The amount
of OID allocable to the final accrual period is the difference between (x) the
amount payable at the maturity of the Debt Security (other than any payment of
qualified stated interest) and (y) the Debt Security's adjusted issue price as
of the beginning of the final accrual period.

     ACQUISITION PREMIUM. A United States Holder that purchases a Debt Security
for an amount less than or equal to the sum of all amounts payable on the Debt
Security after the purchase date (other than payments of qualified stated
interest) but in excess of its adjusted issue price (any such excess being
"acquisition premium") and that does not make the election described below under
"Election to Treat All Interest as Original Issue Discount" is permitted to
reduce the daily portions of OID by a fraction, the numerator of which is the
excess of the United States Holder's adjusted basis in the Debt Security
immediately after its purchase over the adjusted issue price of the Debt
Security, and the denominator of which is the excess of the sum of all amounts
payable on the Debt Security after the purchase date, other than payments of
qualified stated interest, over the Debt Security's adjusted issue price.

     MARKET DISCOUNT. A Debt Security, other than a short-term Debt Security,
will be treated as purchased at a market discount (a "Market Discount Debt
Security") if (i) the amount for which a United States Holder purchased the Debt
Security is less than the Debt Security's issue price (as determined above under
" -- General") and (ii) the Debt Security's stated redemption price at maturity
or, in the case of a Discount Debt Security, the Debt Security's "revised issue
price," exceeds the amount for which the United States Holder purchased the Debt
Security by at least one quarter of one percent of such Debt Security's stated
redemption price at maturity or revised issue price, respectively, multiplied by
the number of complete years to the Debt Security's maturity. If such excess is
not sufficient to cause the Debt Security to be a Market Discount Debt Security,
then such excess constitutes "de minimis market discount." The Code provides
that, for these purposes, the "revised

                                       16


<PAGE>
issue price" of a Debt Security generally equals its issue price, increased by
the amount of any OID that has accrued on the Debt Security.

     Any gain recognized on the maturity or disposition of a Market Discount
Debt Security will be treated as ordinary income to the extent that such gain
does not exceed the accrued market discount on such Debt Security.
Alternatively, a United States Holder of a Market Discount Debt Security may
elect to include market discount in income currently over the life of the Debt
Security. Such an election shall apply to all debt instruments with market
discount acquired by the electing United States Holder on or after the first day
of the first taxable year to which the election applies. This election may not
be revoked without the consent of the Service.

     Market discount on a Market Discount Debt Security will accrue on a
straight-line basis unless the United States Holder elects to accrue such market
discount on a constant-yield method. Such an election shall apply only to the
Debt Security with respect to which it is made and may not be revoked. A United
States Holder of a Market Discount Debt Security that does not elect to include
market discount in income currently generally will be required to defer
deductions for interest on borrowings allocable to such Debt Security in an
amount not exceeding the accrued market discount on such Debt Security until the
maturity or disposition of such Debt Security.

     PRE-ISSUANCE ACCRUED INTEREST. If (i) a portion of the initial purchase
price of a Debt Security is attributable to pre-issuance accrued interest, (ii)
the first stated interest payment on the Debt Security is to be made within one
year of the Debt Security's issue date and (iii) the payment will equal or
exceed the amount of pre-issuance accrued interest, then the United States
Holder may elect to decrease the issue price of the Debt Security by the amount
of pre-issuance accrued interest. In that event, a portion of the first stated
interest payment will be treated as a return of the excluded pre-issuance
accrued interest and not as an amount payable on the Debt Security.

     DEBT SECURITIES SUBJECT TO CONTINGENCIES INCLUDING OPTIONAL REDEMPTION. In
general, if a Debt Security provides for an alternative payment schedule or
schedules applicable upon the occurrence of a contingency or contingencies and
the timing and amounts of the payments that comprise each payment schedule are
known as of the issue date, the yield and maturity of the Debt Security are
determined by assuming that the payments will be made according to the Debt
Security's stated payment schedule. If, however, based on all the facts and
circumstances as of the issue date, it is more likely than not that the Debt
Security's stated payment schedule will not occur, then, in general, the yield
and maturity of the Debt Security are computed based on the payment schedule
most likely to occur.

     Notwithstanding the general rules for determining yield and maturity in the
case of Debt Securities subject to contingencies, if the Company or the Holder
has an unconditional option or options that, if exercised, would require
payments to be made on the Debt Security under an alternative payment schedule
or schedules, then (i) in the case of an option or options of the Company, the
Company will be deemed to exercise or not exercise an option or combination of
options in the manner that minimizes the yield on the Debt Security and (ii) in
the case of an option or options of the Holder, the Holder will be deemed to
exercise or not exercise an option or combination of options in the manner that
maximizes the yield on the Debt Security. For purposes of those calculations,
the yield on the Debt Security is determined by using any date on which the Debt
Security may be redeemed or repurchased as the maturity date and the amount
payable on such date in accordance with the terms of the Debt Security as the
principal amount payable at maturity.

     If a contingency (including the exercise of an option) fails to occur or
actually occurs in a manner inconsistent with the assumption made according to
the above rules (a "change in circumstances") then, except to the extent that a
portion of the Debt Security is repaid as a result of the change in
circumstances and solely for purposes of the accrual of OID, the yield and
maturity of the Debt Security are redetermined by treating the Debt Security as
reissued on the date of the change in circumstances for an amount equal to the
Debt Security's adjusted issue price on that date.

     ELECTION TO TREAT ALL INTEREST AS ORIGINAL ISSUE DISCOUNT. A United States
Holder may elect to include in gross income all interest that accrues on a Debt
Security using the constant-yield method described above under the heading
" -- General," with the modifications described below. For purposes of this
election, interest includes stated interest, OID, de minimis original issue
discount, market discount, de minimis market discount and unstated interest, as
adjusted by any amortizable bond premium (described below under " -- Debt
Securities Purchased at a Premium") or acquisition premium.

     In applying the constant-yield method to a Debt Security with respect to
which this election has been made, the issue price of the Debt Security will
equal the electing United States Holder's adjusted basis in the Debt Security
immediately after its acquisition, the issue date of the Debt Security will be
the date of its acquisition by the electing United States Holder, and no
payments on the Debt Security will be treated as payments of qualified stated
interest. This election will generally apply only to the Debt Security with
respect to which it is made and may not be revoked without the consent of the
Service. If this

                                       17


<PAGE>
election is made with respect to a Debt Security with amortizable bond premium,
then the electing United States Holder will be deemed to have elected to apply
amortizable bond premium against interest with respect to all debt instruments
with amortizable bond premium (other than debt instruments the interest on which
is excludible from gross income) held by the electing United States Holder as of
the beginning of the taxable year in which the Debt Security with respect to
which the election is made is acquired or thereafter acquired. The deemed
election with respect to amortizable bond premium may not be revoked without the
consent of the Service.

     If the election to apply the constant-yield method to all interest on a
Debt Security is made with respect to a Market Discount Debt Security, the
electing United States Holder will be treated as having made the election
discussed above under " -- Market Discount" to include market discount in income
currently over the life of all debt instruments held or thereafter acquired by
such United States Holder.

     VARIABLE RATE DEBT SECURITIES. A "Variable Rate Debt Security" is a Debt
Security that: (i) has an issue price that does not exceed the total
noncontingent principal payments by more than the lesser of (1) .015 multiplied
by the product of (x) the total noncontingent principal payments and (y) the
number of complete years to maturity from the issue date, or (2) 15 percent of
the total noncontingent principal payments; (ii) provides for stated interest
compounded or paid at least annually at (1) one or more "qualified floating
rates," (2) a single fixed rate and one or more qualified floating rates, (3) a
single "objective rate" or (4) a single fixed rate and a single objective rate
that is a "qualified inverse floating rate"; and (iii) provides that a qualified
floating rate or objective rate in effect at any time during the term of the
instrument must be set at a "current value" of that rate (i.e., the value of the
rate on any day that is no earlier than three months prior to the first day on
which that value is in effect and no later than one year following that first
day).

     A variable rate is a "qualified floating rate" if (i) variations in the
value of the rate can reasonably be expected to measure contemporaneous
variations in the cost of newly borrowed funds in the currency in which the Debt
Security is denominated or (ii) it is equal to the product of such a rate and
either (a) a fixed multiple that is greater than zero but not more than 1.35, or
(b) a fixed multiple greater than zero but not more than 1.35, increased or
decreased by a fixed rate. A rate is not a qualified floating rate, however, if
the rate is subject to certain restrictions (including caps, floors, governors
or other similar restrictions) unless such restrictions are fixed throughout the
term of the Debt Security or are not reasonably expected to significantly affect
the yield on the Debt Security.

     An "objective rate" is a rate, other than a qualified floating rate, that
is determined using a single, fixed formula and that is based on (i) one or more
qualified floating rates, (ii) one or more rates each of which would be a
qualified floating rate for a debt instrument denominated in a currency other
than the currency in which the debt instrument is denominated, (iii) the yield
or changes in the price of one or more actively traded items of personal
property other than stock or debt of the issuer or a related party or (iv) a
combination of objective rates. A variable rate is not an objective rate,
however, if it is reasonably expected that the average value of the rate during
the first half of the Debt Security's term will be either significantly less
than or significantly greater than the average value of the rate during the
final half of the Debt Security's term. An objective rate is a "qualified
inverse floating rate" if (i) the rate is equal to a fixed rate minus a
qualified floating rate, and (ii) the variations in the rate can reasonably be
expected to inversely reflect contemporaneous variations in the cost of newly
borrowed funds. Under these rules, Commercial Paper Rate Debt securities, Prime
Rate Debt securities, LIBOR Debt Securities, Treasury Rate Debt Securities, CD
Rate Debt Securities, and Federal Funds Rate Debt Securities will generally be
treated as Variable Rate Debt Securities.

     In general, if a Variable Rate Debt Security provides for stated interest
at a single qualified floating rate or objective rate, all stated interest on
the Debt Security is qualified stated interest and the amount of OID, if any, is
determined by using, in the case of a qualified floating rate or qualified
inverse floating rate, a fixed rate equal to the value as of the issue date of
the qualified floating rate or qualified inverse floating rate, or, in the case
of any other objective rate, a fixed rate that reflects the yield reasonably
expected for the Debt Security.

     If a Variable Rate Debt Security does not provide for stated interest at a
single qualified floating rate or objective rate, the amount of interest and OID
accruals on the Debt Security are generally determined by (i) determining a
fixed rate substitute for each variable rate provided under the Variable Rate
Debt Security, (ii) constructing the equivalent fixed rate debt instrument
(using the fixed rate substitute described above), (iii) determining the amount
of qualified stated interest and OID with respect to the equivalent fixed rate
debt instrument, and (iv) making the appropriate adjustments for actual variable
rates during the applicable accrual period.

     If a Variable Rate Debt Security provides for stated interest either at one
or more qualified floating rates or at a qualified inverse floating rate, and in
addition provides for stated interest at a single fixed rate (other than at a
single fixed rate for an

                                       18


<PAGE>
initial period), the amount of interest and OID accruals are determined as in
the immediately preceding paragraph with the modification that the Variable Rate
Debt Security is treated, for purposes of the first three steps of the
determination, as if it provided for a qualified floating rate (or a qualified
inverse floating rate, as the case may be) rather than the fixed rate. The
qualified floating rate (or qualified inverse floating rate) replacing the fixed
rate must be such that the fair market value of the Variable Rate Debt Security
as of the issue date would be approximately the same as the fair market value of
an otherwise identical debt instrument that provides for the qualified floating
rate (or qualified inverse floating rate) rather than the fixed rate.

     SHORT-TERM DEBT SECURITIES. In general, an individual or other cash basis
United States Holder of a Debt Security with a term of one year or less (a
"short-term Debt Security") is not required to accrue OID (as specially defined
below for the purposes of this paragraph) for United States federal income tax
purposes unless it elects to do so (but may be required to include any stated
interest in income as the interest is received). Accrual basis United States
Holders and certain other United States Holders, including banks, regulated
investment companies, dealers in securities, common trust funds, United States
Holders who hold Debt Securities as part of certain identified hedging
transactions, certain pass-through entities and cash basis United States Holders
who so elect, are required to accrue OID on short-term Debt Securities on either
a straight- line basis or under the constant-yield method (based on daily
compounding), at the election of the United States Holder.

     In the case of a United States Holder not required and not electing to
include OID in income currently, any gain realized on the sale or retirement of
the short-term Debt Security will be ordinary income to the extent of the OID
accrued on a straight-line basis (unless an election is made to accrue the OID
under the constant- yield method) through the date of sale or retirement. United
States Holders who are not required and do not elect to accrue OID on short-term
Debt Securities will be required to defer deductions for interest on borrowings
allocable to short-term Debt Securities in an amount not exceeding the deferred
income until the deferred income is realized.

     For purposes of determining the amount of OID subject to these rules, all
interest payments on a short-term Debt Security, including stated interest, are
included in the short-term Debt Security's stated redemption price at maturity.

     FOREIGN CURRENCY DISCOUNT DEBT SECURITIES. OID for any accrual period on a
Discount Debt Security that is denominated in, or determined by reference to, a
foreign currency will be determined in the foreign currency and then translated
into U.S. dollars in the same manner as stated interest accrued by an accrual
basis United States Holder, as described under "Payments of Interest." Upon
receipt of an amount attributable to OID (whether in connection with a payment
of interest or the sale or retirement of a Debt Security), a United States
Holder may recognize ordinary income or loss.

     DEBT SECURITIES PURCHASED AT A PREMIUM

     A United States Holder that purchases a Debt Security for an amount in
excess of its principal amount may elect to treat such excess as "amortizable
bond premium", in which case the amount required to be included in the United
States Holder's income each year with respect to interest on the Debt Security
will be reduced by the amount of amortizable bond premium allocable (based on
the Debt Security's yield to maturity) to such year. In the case of a Debt
Security that is denominated in, or determined by reference to, a foreign
currency, bond premium will be computed in units of foreign currency, and
amortizable bond premium will reduce interest income in units of the foreign
currency. At the time amortized bond premium offsets interest income, exchange
gain or loss (taxable as ordinary income or loss) is realized measured by the
difference between exchange rates at that time and at the time of the
acquisition of the Debt Securities. Any election to amortize bond premium shall
apply to all bonds (other than bonds the interest on which is excludible from
gross income) held by the United States Holder at the beginning of the first
taxable year to which the election applies or thereafter acquired by the United
States Holder, and is irrevocable without the consent of the Service. See also
"Original Issue Discount - Election to Treat All Interest as Original Issue
Discount".

     PURCHASE, SALE AND RETIREMENT OF THE DEBT SECURITIES

     A United States Holder's tax basis in a Debt Security will generally be its
U.S. dollar cost (as defined below), increased by the amount of any OID or
market discount included in the United States Holder's income with respect to
the Debt Security and the amount, if any, of income attributable to de minimis
original issue discount and de minimis market discount included in the United
States Holder's income with respect to the Debt Security, and reduced by (i) the
amount of any payments that are not qualified stated interest payments, and (ii)
the amount of any amortizable bond premium applied to reduce interest on the
Debt Security. The U.S. dollar cost of a Debt Security purchased with a foreign
currency will generally

                                       19


<PAGE>
be the U.S. dollar value of the purchase price on the date of purchase or, in
the case of Debt Securities traded on an established securities market, as
defined in the applicable Treasury Regulations, that are purchased by a cash
basis United States Holder (or an accrual basis United States Holder that so
elects), on the settlement date for the purchase.

     A United States Holder will generally recognize gain or loss on the sale or
retirement of a Debt Security equal to the difference between the amount
realized on the sale or retirement and its tax basis in the Debt Security. The
amount realized on a sale or retirement for an amount in foreign currency will
be the U.S. dollar value of such amount on (i) the date payment is received in
the case of a cash basis United States Holder, (ii) the date of disposition in
the case of an accrual basis United States Holder or (iii) in the case of Debt
Securities traded on an established securities market, as defined in the
applicable Treasury Regulations, sold by a cash basis United States Holder (or
an accrual basis United States Holder that so elects), on the settlement date
for the sale. Except to the extent described above under "Original Issue
Discount - Short-Term Debt Securities" or described in the next succeeding
paragraph or attributable to accrued but unpaid interest, gain or loss
recognized on the sale or retirement of a Debt Security will be capital gain or
loss and will be long-term capital gain or loss if the Debt Security was held
for more than one year.

     Gain or loss recognized by a United States Holder on the sale or retirement
of a Debt Security that is attributable to changes in exchange rates will be
treated as ordinary income or loss. However, exchange gain or loss is taken into
account only to the extent of total gain or loss realized on the transaction.

     EXCHANGE OF AMOUNTS IN OTHER THAN U.S. DOLLARS

     Foreign currency received as interest on a Debt Security or on the sale or
retirement of a Debt Security will have a tax basis equal to its U.S. dollar
value at the time such interest is received or at the time of such sale or
retirement. Foreign currency that is purchased will generally have a tax basis
equal to the U.S. dollar value of the foreign currency on the date of purchase.
Any gain or loss recognized on a sale or other disposition of a foreign currency
(including its use to purchase Debt Securities or upon exchange for U.S.
dollars) will be ordinary income or loss.

     INDEXED DEBT SECURITIES

     The applicable Prospectus Supplement will contain a discussion of any
special United States federal income tax rules with respect to Debt Securities
(other than Debt Securities subject to the rules governing Variable Rate Debt
Securities), payments on which are determined by reference to any index.

UNITED STATES ALIEN HOLDERS

     For purposes of this discussion, a "United States Alien Holder" is any
holder of a Debt Security who is (i) a nonresident alien individual or (ii) a
foreign corporation, partnership or estate or trust which is not subject to
United States federal income tax on a net income basis in respect of income or
gain from a Debt Security. This discussion assumes that the Debt Security is not
subject to the rules of Section 871(h) (4) (A) of the Code (relating to interest
payments that are determined by reference to the income, profits, changes in the
value of property or other attributes of the debtor or a related party). In
addition, solely with respect to United States federal estate tax, the
discussion assumes that the Debt Security had a maturity date, when issued, that
was not less than 184 days from the date of issuance.

     Under present United States federal income and estate tax law, and subject
to the discussion of backup withholding below:

     (1) payments of principal, premium (if any) and interest, including OID, by
the Company or any of its paying agents to any holder of a Debt Security that is
a United States Alien Holder will not be subject to United States federal
withholding tax if, in the case of interest or OID, (i) the beneficial owner of
the Debt Security does not actually or constructively own 10% or more of the
total combined voting power of all classes of stock of the Company entitled to
vote, (ii) the beneficial owner of the Debt Security is not a controlled foreign
corporation that is related to the Company through stock ownership, and (iii) if
the Debt Security is a Registered Security, either (a) the beneficial owner of
the Debt Security certifies to the Company or its agent, under penalties of
perjury, that it is not a United States Holder and provides its name and address
or (b) a securities clearing organization, bank or other financial institution
that holds customers' securities in the ordinary course of its trade or business
(a "financial institution") and holds the Debt Security on behalf of a
beneficial owner certifies to the Company or its agent, under penalties of
perjury, that such statement has been received from the beneficial owner by it
or by a financial institution between it and the beneficial owner and furnishes
the payor with a copy thereof;

                                       20


<PAGE>
     (2) a United States Alien Holder of a Debt Security will not be subject to
United States federal withholding tax on any gain realized on the sale or
exchange of a Debt Security; and

     (3) a Debt Security held by an individual who at death is not a citizen or
resident of the United States will not be includible in the individual's gross
estate for purposes of the United States federal estate tax as a result of the
individual's death if (a) the individual did not actually or constructively own
10% or more of the total combined voting power of all classes of stock of the
Company entitled to vote and (b) the income on the Debt Security would not have
been effectively connected with a United States trade or business of the
individual at the individual's death.

BEARER DEBT SECURITIES

     The applicable Prospectus Supplement will contain a discussion of any
special United States federal income tax rules with respect to Debt Securities
that are issued as Bearer Securities (including Debt Securities in permanent
global form).

BACKUP WITHHOLDING AND INFORMATION REPORTING

     UNITED STATES HOLDERS

     In general, information reporting requirements will apply to payments of
principal, any premium and interest on a Debt Security and the proceeds of the
sale of a Debt Security before maturity within the United States to, and to the
accrual of OID on a Discount Debt Security with respect to, non-corporate United
States Holders, and "backup withholding" at a rate of 31% will apply to such
payments and to payments of OID if the United States Holder fails to provide an
accurate taxpayer identification number or to report all interest and dividends
required to be shown on its federal income tax returns.

     UNITED STATES ALIEN HOLDERS

     Information reporting and backup withholding will not apply to payments of
principal, premium (if any) and interest (including OID) made by the Company or
a paying agent to a United States Alien Holder on a Registered Security if
either of the certifications described in clause (1) (iii) under "United States
Alien Holders" above is received, provided that the payor does not have actual
knowledge that the holder is a United States person.

     Payments of the proceeds from the sale by a United States Alien Holder of a
Debt Security made to or through a foreign office of a broker will not be
subject to information reporting or backup withholding, except that if the
broker is a United States person, a controlled foreign corporation for United
States tax purposes or a foreign person 50% or more of whose gross income is
effectively connected with a United States trade or business for a specified
three-year period, information reporting may apply to such payments. Payments of
the proceeds from the sale of a Debt Security to or through the United States
office of a broker is subject to information reporting and backup withholding
unless the holder or beneficial owner certifies as to its non-United States
status or otherwise establishes an exemption from information reporting and
backup withholding.

                              PLAN OF DISTRIBUTION

     The Company may sell Debt Securities (i) to or through underwriters or
dealers, (ii) through agents, (iii) directly to purchasers, or (iv) through a
combination of any of the foregoing. Any such underwriter, dealer or agent may
be deemed to be an underwriter within the meaning of the Securities Act. Any
Prospectus Supplement relating to Debt Securities will set forth their offering
terms, including the name or names of any underwriters, the purchase price of
the Debt Securities and the proceeds to the Company from such sale, any
underwriting discounts, commissions and other items constituting underwriters'
compensation, any initial public offering price, any discounts or concessions
allowed or reallowed or paid to dealers, and any securities exchanges on which
the Debt Securities may be listed.

     If underwriters are used in the sale, the Debt Securities will be acquired
by the underwriters for their own account and may be resold from time to time in
one or more transactions, at a fixed price or prices, which may be changed, or
at market prices prevailing at the time of sale, or at prices related to such
prevailing market prices, or at negotiated prices. The Debt Securities may be
offered to the public either through underwriting syndicates represented by one
or more managing underwriters or directly by one or more of such firms. Unless
otherwise set forth in the Prospectus Supplement, the obligations of the
underwriters to purchase the Debt Securities will be subject to certain
conditions precedent and the underwriters will be obligated to purchase all the
Debt Securities if any are purchased. Any initial public offering price and any
discounts or concessions allowed or reallowed or paid to dealers may be changed
from time to time. Under agreements which may be

                                       21


<PAGE>
entered into by the Company, underwriters, dealers and agents who participate in
the distribution of Debt Securities may be entitled to indemnification or
contribution by the Company against certain liabilities, including liabilities
under the Securities Act.

     The specific terms and manner of sale of Debt Securities will be set forth
or summarized in the Prospectus Supplement relating thereto.

     If so indicated in a Prospectus Supplement, the Company will authorize
underwriters or other persons acting as the Company's agents to solicit offers
by certain institutions to purchase Debt Securities from the Company pursuant to
contracts providing for payment and delivery on a future date. Institutions with
which such contracts may be made include commercial and savings banks, insurance
companies, pension funds, investment companies, educational and charitable
institutions and others, but in all cases will be subject to acceptance by the
Company. The obligations of any purchaser under any such contracts will be
subject to the conditions that the purchase of Debt Securities shall not at the
time of delivery be prohibited under the laws of the jurisdiction to which such
purchaser is subject. The underwriters and such other persons will not have any
responsibility in respect of the validity or performance of such contracts.

     Each underwriter and agent participating in the distribution of any Debt
Securities which are issuable in bearer form will agree that it will not offer,
sell or deliver, directly or indirectly, Debt Securities in bearer form in the
United States or to United States persons (other than qualifying financial
institutions) in connection with the original issuance of Debt Securities.

                          VALIDITY OF DEBT SECURITIES

     The validity of the Debt Securities offered hereby will be passed upon for
the Company by McGuire, Woods, Battle & Boothe, L.L.P., One James Center,
Richmond, Virginia 23219, and for the Underwriters by Sullivan & Cromwell, 1701
Pennsylvania Avenue, N.W., Washington, D.C. 20006. Sullivan & Cromwell will rely
as to all matters governed by Virginia law on the opinion of McGuire, Woods,
Battle & Boothe, L.L.P.

                                    EXPERTS

     The consolidated financial statements of Universal Corporation and
Subsidiaries included in Universal Corporation's Annual Report on Form 10-K for
the year ended June 30, 1995 have been audited by Ernst & Young LLP, independent
auditors, as set forth in their report included therein and incorporated herein
by reference. Such consolidated financial statements are incorporated herein by
reference in reliance upon such report given upon the authority of such firm as
experts in accounting and auditing.

                                       22


<PAGE>

NO DEALER, SALESMAN OR ANY OTHER PERSON HAS BEEN AUTHORIZED TO GIVE ANY
INFORMATION OR TO MAKE ANY REPRESENTATIONS OTHER THAN THOSE CONTAINED OR
INCORPORATED BY REFERENCE IN THIS PROSPECTUS IN CONNECTION WITH THE OFFER
CONTAINED IN THIS PROSPECTUS, AND, IF GIVEN OR MADE, SUCH OTHER INFORMATION OR
REPRESENTATIONS MUST NOT BE RELIED UPON AS HAVING BEEN AUTHORIZED BY THE COMPANY
OR THE UNDERWRITERS. THIS PROSPECTUS DOES NOT CONSTITUTE AN OFFER BY THE COMPANY
OR BY ANY UNDERWRITER TO SELL DEBT SECURITIES IN ANY STATE TO ANY PERSON TO WHOM
IT IS UNLAWFUL FOR THE COMPANY OR SUCH UNDERWRITER TO MAKE SUCH OFFER IN SUCH
STATE. NEITHER THE DELIVERY OF THIS PROSPECTUS NOR ANY SALE MADE HEREUNDER
SHALL, UNDER ANY CIRCUMSTANCES, CREATE AN IMPLICATION THAT THERE HAS BEEN NO
CHANGE IN THE AFFAIRS OF THE COMPANY SINCE THE DATE HEREOF OR THAT THE
INFORMATION CONTAINED OR INCORPORATED BY REFERENCE HEREIN IS CORRECT AS OF ANY
TIME SUBSEQUENT TO ITS DATE.

                               TABLE OF CONTENTS


<TABLE>
<CAPTION>
                                                        PAGE

<S>                                                     <C>
                     PROSPECTUS

Available Information................................
Incorporation of Certain Documents by
  Reference..........................................
The Company..........................................
Ratio of Earnings to Fixed Charges...................
Use of Proceeds......................................
Description of Debt Securities.......................
Limitations on Issuance of Euro-Securities...........
Foreign Currency Risks...............................
United States Taxation...............................
Plan of Distribution.................................
Validity of Debt Securities..........................
Experts..............................................
</TABLE>


                                  $200,000,000

                                [UNIVERSAL LOGO]

                                DEBT SECURITIES

                                   PROSPECTUS


<PAGE>

                                    PART II
                     INFORMATION NOT REQUIRED IN PROSPECTUS

ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION*


<TABLE>
<S>                                                                                          <C>
SEC registration fee......................................................................   $ 68,966
Accountants' fees and expenses............................................................     45,000
Attorneys' fees and expenses..............................................................     60,000
Printing and engraving expenses...........................................................     20,000
Fees and expenses of trustee..............................................................     15,000
State qualification fees and expenses.....................................................     18,000
Rating agencies' fees.....................................................................    125,000
Miscellaneous.............................................................................      8,034
  Total...................................................................................   $360,000
</TABLE>


* All fees and expenses other than the SEC registration fee are estimated.

ITEM 15. INDEMNIFICATION OF DIRECTORS AND OFFICERS

     Article 10 of the Virginia Stock Corporation Act allows, in general, for
indemnification, in certain circumstances, by a corporation of any person
threatened with or made a party to any action, suit or proceeding by reason of
the fact that he or she is, or was, a director, officer, employee or agent of
such corporation. Indemnification is also authorized with respect to a criminal
action or proceeding where the person had no reasonable cause to believe that
his conduct was unlawful. Article 9 of the Virginia Stock Corporation Act
provides limitations on damages payable by officers and directors, except in
cases of willful misconduct or knowing violation of criminal law or any federal
or state securities law.

     Article VIII of the Company's Restated Articles of Incorporation provides
for mandatory indemnification of any director or officer of the Company who is
or was a party to any proceeding by reason of the fact that he is or was a
director or officer of the Company against all liabilities and expenses incurred
in the proceeding, except such liabilities and expenses as are incurred because
of such director's or officer's willful misconduct or knowing violation of the
criminal law.

     The Company's Restated Articles of Incorporation also provide that in every
instance permitted under Virginia corporate law in effect from time to time, the
liability of a director or officer of the Company to the Company or its
shareholders shall not exceed one dollar.

     The Company maintains a standard policy of officers' and directors'
liability insurance.

     In the Underwriting Agreement, a form of which is filed as Exhibit 1.1
hereto, the Underwriters will agree to indemnify, under certain conditions, the
Company, its directors, certain of its officers and persons who control the
Company within the meaning of the Securities Act against certain liabilities.

ITEM 16. EXHIBITS

   

<TABLE>
<C>     <S>
  1.1   Proposed form of Underwriting Agreement
 *4.1   Indenture dated as of February 1, 1991 between the Company and Chemical Bank, as Trustee, including proposed
        forms of Debt Securities (incorporated by reference to Exhibit 4.1 to Registration Statement No. 33-38586 on
        Form S-3)
 *5.1   Opinion and consent of McGuire, Woods, Battle & Boothe, L.L.P., as to the validity of the Debt Securities
 *8.1   Opinion and consent of McGuire, Woods, Battle & Boothe, L.L.P., as to certain tax matters
*12.1   Computation of ratio of earnings to fixed charges
 23.1   Consent of Ernst & Young LLP
*23.2   Consents of McGuire, Woods, Battle & Boothe, L.L.P. (included as part of Exhibits 5.1 and 8.1)
*24.1   Power of attorney from officers and directors of the Company signing by an attorney-in-fact
*25.1   Form T-1 Statement of Eligibility and Qualification under the Trust Indenture Act of 1939, as amended, of
        Chemical Bank
</TABLE>

    

   
*Previously filed
    

                                      II-1


<PAGE>
ITEM 17. UNDERTAKINGS

     1. The undersigned registrant hereby undertakes:

          (a) To file, during any period in which offers or sales are being
     made, a post-effective amendment to this registration statement:

             (i) To include any prospectus required by Section 10(a)(3) of the
        Securities Act;

             (ii) To reflect in the prospectus any facts or events arising after
        the effective date of the registration statement (or the most recent
        post-effective amendment thereof) which, individually or in the
        aggregate, represent a fundamental change in the information set forth
        in the registration statement. Notwithstanding the foregoing, any
        increase or decrease in volume of securities offered (if the total
        dollar value of securities offered would not exceed that which was
        registered) and any deviation from the low or high and of the estimated
        maximum offering range may be reflected in the form of prospectus filed
        with the Commission pursuant to Rule 424(b) if, in the aggregate, the
        changes in volume and price represent no more than 20 percent change in
        the maximum aggregate offering price set forth in the "Calculation of
        Registration Fee" table in the effective registration statement;

             (iii) To include any material information with respect to the plan
        of distribution not previously disclosed in the registration statement
        or any material change to such information in the registration
        statement;

PROVIDED, HOWEVER, that paragraphs (a)(i) and (a)(ii) do not apply if the
information required to be included in a post-effective amendment by those
paragraphs is contained in periodic reports filed by the registrant pursuant to
Section 13 or 15(d) of the Exchange Act that are incorporated by reference in
the registration statement.

          (b) That, for the purpose of determining any liability under the
     Securities Act, each such post-effective amendment shall be deemed to be a
     new registration statement relating to the securities offered therein, and
     the offering of such securities at that time shall be deemed to be the
     initial bona fide offering thereof.

          (c) To remove from registration by means of a post-effective amendment
     any of the securities being registered which remain unsold at the
     termination of the offering.

     2. The undersigned registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act, each filing of the
registrant's annual report pursuant to Section 13(a) or 15(d) of the Exchange
Act that is incorporated by reference in the registration statement shall be
deemed to be a new registration statement relating to the securities offered
therein, and the offering of such securities at that time shall be deemed to be
the initial bona fide offering thereof.

   
     3. Insofar as indemnification for liabilities arising under the Securities
Act may be permitted to directors, officers and controlling persons of the
registrant pursuant to the provisions described under Item 15 above, or
otherwise, the registrant has been advised that in the opinion of the Commission
such indemnification is against public policy as expressed in the Securities Act
and is, therefore, unenforceable. In the event that a claim for indemnification
against such liabilities (other than the payment by the registrant of expenses
incurred or paid by a director, officer or controlling person of the registrant
in the successful defense of any action, suit or proceeding) is asserted by such
director, officer or controlling person in connection with the securities being
registered, the registrant will, unless in the opinion of its counsel the matter
has been settled by controlling precedent, submit to a court of appropriate
jurisdiction the question whether such indemnification by it is against public
policy as expressed in the Securities Act and will be governed by the final
    
adjudication of such issue.

                                      II-2


<PAGE>

                                   SIGNATURES

   
     Pursuant to the requirements of the Securities Act, the registrant
certifies that it has reasonable grounds to believe that it meets all of the
requirements for filing on Form S-3 and has duly caused this amendment to the
registration statement to be signed on its behalf by the undersigned, thereunto
duly authorized, in the City of Richmond and Commonwealth of Virginia, on
February 1, 1996.
    

                                         UNIVERSAL CORPORATION

   
                                         By: /s/       HARTWELL H. ROPER
    

   
                                                     HARTWELL H. ROPER
                                            VICE PRESIDENT AND CHIEF FINANCIAL
                                                           OFFICER
    

   
     Pursuant to the requirements of the Securities Act, this amendment to the
registration statement has been signed below by the following persons in the
capacities and on the date indicated.
    

   

<TABLE>
<S>                                                     <C>
                          HENRY H. HARRELL*             Chairman and Chief Executive Officer and Director
                   HENRY H. HARRELL                       (Principal Executive Officer)

          /s/              HARTWELL H. ROPER            Vice President and Chief Financial Officer
                  HARTWELL H. ROPER                       (Principal Financial Officer)

         /s/             WILLIAM J. CORONADO            Controller (Principal Accounting Officer)
                 WILLIAM J. CORONADO

                         WILLIAM W. BERRY*              Director
                   WILLIAM W. BERRY

                         RONALD E. CARRIER*             Director
                  RONALD E. CARRIER

                       WALLACE L. CHANDLER*             Director
                 WALLACE L. CHANDLER

                    LAWRENCE S. EAGLEBURGER*            Director
               LAWRENCE S. EAGLEBURGER

                     CHARLES H. FOSTER, JR.*            Director
                  CHARLES H. FOSTER

                         RICHARD G. HOLDER*             Director
                  RICHARD G. HOLDER

                            ALLEN B. KING*              President and Chief Operating Officer
                    ALLEN B. KING                         and Director
</TABLE>

    

                                      II-3



<PAGE>
   

<TABLE>
<S>                                                     <C>
                       JOHN D. MUNFORD, II*             Director
                 JOHN D. MUNFORD, II

                        HUBERT R. STALLARD*             Director
                  HUBERT R. STALLARD

* By:           /s/ WILLIAM L. TAYLOR
                     WILLIAM L. TAYLOR,
                     AS ATTORNEY-IN-FACT
</TABLE>

    

   
February 1, 1996
    

                                      II-4







<PAGE>
                                                                     EXHIBIT 1.1

                             UNDERWRITING AGREEMENT

                                                                           , 199

[Representative[s] of the
several Underwriters]

Dear Sirs:

     Universal Corporation (the "Company") proposes to issue and sell from time
to time certain of its debt securities (the "Securities") registered under the
registration statement referred to below. The Securities will be issued under an
Indenture (the "Indenture"), dated as of February 1, 1991, between the Company
and Chemical Bank, as Trustee, and will have varying designations, interest
rates and times of payment of any interest, maturities, redemption provisions
and other terms, with all such terms for any particular series of the Securities
being determined at the time of the sale. Particular series of the Securities
may be sold to you, and to other firms on whose behalf you may act, for resale
in accordance with the terms of offering determined at the time of sale. The
firm or firms which agree to purchase the Securities are hereinafter referred to
as the "Underwriters" of such Securities.

     This Agreement shall apply only to Securities in respect of which a Terms
Agreement shall have been executed as referred to herein.

     The Company and the Underwriters agree as follows:

     1. PURCHASE AND OFFERING.

     (a) The obligations
 of the Underwriters to purchase the Securities will be
evidenced by an exchange of telegraphic or other written communications (a
"Terms Agreement") at each time the Company determines to sell the Securities.
Each Terms Agreement shall specify the firms which will be Underwriters (who
shall become bound by the terms hereof when the Terms Agreement has been entered
into), the principal amount to be purchased by each Underwriter, the purchase
price to be paid by the Underwriters and the terms of the Securities not already
specified in the Indenture, including, but not limited to, interest rates,
maturities, redemption provisions and sinking fund requirements. Each Terms
Agreement shall also specify the date of delivery and payment for the Securities
and any details of the terms of offering which should be reflected in the
Prospectus Supplement relating to the offering of the Securities. Such
Prospectus Supplement shall set forth the terms contained in the Terms Agreement
and such other information that you and the Company agree at the time the Terms
Agreement is entered into should be included in the Prospectus Supplement.
Insofar as any provision of this Agreement is inconsistent with any Terms
Agreement, the Terms Agreement shall be deemed to control. The obligations of
the Underwriters to purchase the Securities shall be several and not joint. It
is understood that the Underwriters propose to offer the Securities for sale as
set forth in such Prospectus Supplement.

     (b) Payment of the purchase price for the Securities shall be made to the
Company or its order by wire transfer of immediately available funds or in any
other manner satisfactory to the Company against delivery of the Securities to
you for the respective accounts of the Underwriters. Such payment and delivery
shall be made at 10:00 A.M.1 on the date of delivery specified in the Terms
Agreement (unless another time not later than 10:00 A.M. on the third business
day2 thereafter shall be agreed to by you and the Company or unless postponed in
accordance with the provisions of Section 8 hereof). The time and date that such
payment and delivery are actually made is herein sometimes referred to as the
"Closing Date." The Securities shall be delivered to you in definitive form, in
temporary or final form, and in such names and such principal amounts as, not
later than 10:00 A.M. on the business day immediately preceding the time of
purchase, you shall specify. For the purpose of expediting the checking and
packaging of the Securities by you, the Company agrees to make them available to
you for such purpose prior to the close of business on the business day
immediately preceding the time of purchase.

     2. REPRESENTATIONS AND WARRANTIES OF THE COMPANY. The Company represents
and warrants to each of the Underwriters as of the date of execution of the
Terms Agreement and as of the Closing Date that:

     (a) the Company is permitted to use Form S-3 under the Securities Act of
1933, as amended (the "Act"), and has filed with the Securities and Exchange
Commission (the "Commission") a registration statement on such Form, which has
become

1Times mentioned herein are New York City times.

2As used herein, "business day" shall mean a day on which the New York Stock
Exchange is open for trading.


<PAGE>
effective, for the registration under the Act of the Securities. Such
registration statement, as amended at the date of this Agreement, meets the
requirements set forth in Rule 415(a)(1)(x) under the Act and complies in all
other material respects with said Rule. Such registration statement, including
the exhibits thereto, as amended at the date of any Pricing Agreement, is
hereinafter called the "Registration Statement" and the prospectus included in
the Registration Statement, as supplemented to reflect the terms of any series
of the Securities and the plan of distribution thereof, in the form in which it
shall be filed with the Commission pursuant to Rule 424(b), is hereinafter
called the "Prospectus." Any reference herein to the Registration Statement or
the Prospectus shall be deemed to include the documents incorporated by
reference therein pursuant to Item 12 of Form S-3 which were filed under the
Securities Exchange Act of 1934 (the "Exchange Act") on or before the date of
this Agreement or the date of the Prospectus, as the case may be, and any
reference herein to the terms "amend," "amendment" or "supplement" with respect
to the Registration Statement or the Prospectus shall be deemed to include the
filing of any document under the Exchange Act after the date of this Agreement
or the date of the Prospectus, as the case may be, deemed to be incorporated
therein by reference;

     (b) as of the date of any Terms Agreement, when the Prospectus is first
filed pursuant to Rule 424(b) under the Act, when, prior to the Closing Date,
any amendment to the Registration Statement becomes effective (including the
filing of any document incorporated by reference in the Registration Statement)
and at the Closing Date, (i) the Registration Statement, as amended as of any
such time, and the Prospectus, as amended or supplemented as of any such time,
and the Indenture will comply in all material respects with the applicable
requirements of the Act, the Trust Indenture Act of 1939 (the "Trust Indenture
Act") and the Exchange Act and the respective rules thereunder and (ii) neither
the Registration Statement, as amended as of any such time, nor the Prospectus,
as amended or supplemented as of any such time, will contain any untrue
statement of a material fact or omit to state any material fact required to be
stated therein or necessary in order to make the statements therein not
misleading; provided, however, that the Company makes no warranty or
representation with respect to any statement contained in the Registration
Statement or the Prospectus in reliance upon and in conformity with information
furnished in writing by or on behalf of any Underwriter through you to the
Company expressly for use in the Registration Statement or the Prospectus;

     (c) all of the issued and outstanding shares of capital stock including
Common Stock of the Company have been duly and validly authorized and issued and
are fully paid and non-assessable; and the Company has been duly incorporated
and is validly existing as a corporation in good standing under the laws of the
Commonwealth of Virginia, with full power and authority to own its properties
and conduct its business as described in the Registration Statement and the
Prospectus; the Company has full power and authority to execute and deliver this
Agreement, the Terms Agreement and the Indenture and to issue and sell the
Securities as herein and therein contemplated; (d) the Company and each of its
subsidiaries listed on Schedule A hereto (each a "Material Subsidiary" and
collectively the "Material Subsidiaries") are duly qualified or licensed by, and
are in good standing in, each jurisdiction in which they conduct their
respective businesses and in which the failure, individually or in the
aggregate, to be so licensed or qualified would have a material adverse effect
on the operations, business or financial condition of the Company and its
Subsidiaries, taken as a whole; and the Company and each of its Subsidiaries are
in compliance in all material respects with the laws, orders, rules, regulations
and directives issued or administered by such jurisdictions;

     (e) neither the Company nor any of its subsidiaries (each a "Subsidiary"
and collectively the "Subsidiaries") is in breach of, or in default under (nor
has any event occurred which with notice, lapse of time, or both would
constitute a breach of, or default under), its respective charter or by-laws or
in the performance or observance of any obligation, agreement, covenant or
condition contained in any indenture, mortgage, deed of trust, bank loan or
credit agreement or other agreement or instrument to which the Company or any of
its Subsidiaries is a party or by which any of them is bound, where such breach
or default, individually or in the aggregate, would have a material adverse
effect on the operations, business or financial condition of the Company and its
Subsidiaries, taken as a whole, and the execution, delivery and performance of
this Agreement, the Terms Agreement and the Indenture and the issuance of the
Securities and the consummation of the transactions contemplated hereby and
thereby will not conflict with, or result in any breach of or constitute a
default under (nor constitute any event which with notice, lapse of time, or
both would constitute a breach of, or default under), any provisions of the
charter or by-laws of the Company or any of its Subsidiaries or under any
provision of any license, indenture, mortgage, deed of trust, bank loan or
credit agreement or other agreement or instrument to which the Company or any of
its Subsidiaries is a party or by which any of them or their respective
properties may be bound or affected, or under any federal, state, local or
foreign law, regulation or rule or any decree, judgment or order applicable to
the Company or any of its Subsidiaries where such conflict, breach or default,
individually or in the aggregate, would have a material adverse effect on the
operations, business or financial condition of the Company and its Subsidiaries,
taken as a whole;

     (f) the Indenture has been duly authorized, executed and delivered by the
Company and duly qualified under the Trust Indenture Act and is a legal, valid
and binding agreement of the Company enforceable in accordance with its terms,
subject to


<PAGE>
bankruptcy, insolvency, reorganization, moratorium and similar laws of general
applicability relating to or affecting creditors' rights and to general
principles of equity;

     (g) the Securities have been duly authorized by the Company and when issued
and delivered pursuant to this Agreement, the Terms Agreement and the Indenture
against payment of the consideration therefor, the Securities will have been
duly executed, authenticated, issued and delivered and will constitute legal,
valid and binding obligations of the Company enforceable in accordance with
their terms, subject to bankruptcy, insolvency, reorganization, moratorium and
similar laws of general applicability relating to or affecting creditors' rights
and to general principles of equity;

     (h) this Agreement and the Terms Agreement have been duly authorized,
executed and delivered by the Company;

     (i) the Indenture conforms, and the Securities will conform, in all
material respects to the description thereof contained in the Registration
Statement and Prospectus;

     (j) no approval, authorization, consent or order of or filing with any
national, state or local governmental or regulatory commission, board, body,
authority or agency is required on the part of the Company in connection with
the issuance and sale of the Securities as contemplated hereby other than
registration of the Securities under the Act, qualification of the Indenture
under the Trust Indenture Act and any necessary qualification under the
securities or blue sky laws of the various jurisdictions in which the Securities
are being offered by the Underwriters;

     (k) Ernst & Young LLP, whose reports on the consolidated financial
statements of the Company and its Subsidiaries are filed with the Commission in
documents incorporated by reference into the Registration Statement and
Prospectus are independent public accountants as required by the Act and the
applicable published rules and regulations thereunder;

     (l) each of the Company and its Subsidiaries has all necessary licenses,
authorizations, consents and approvals and has made all necessary filings
required under any federal, state, local or foreign law, regulation or rule, and
has obtained all necessary authorizations, consents and approvals from other
persons, in order to conduct its respective business in each case where failure
to have or to make the same, as the case may be, would have a material adverse
effect on the operations, business or financial condition of the Company and its
Subsidiaries, taken as a whole; neither the Company nor any of its Subsidiaries
is in violation of, or in default under, any such license, authorization,
consent or approval or any federal, state, local or foreign law, regulation or
rule or any decree, order or judgment applicable to the Company or any of its
Subsidiaries the effect of which would have a material adverse effect on the
operations, business or financial condition of the Company and its Subsidiaries,
taken as a whole;

     (m) all legal or governmental proceedings, contracts or documents of a
character required to be described in the Registration Statement or the
Prospectus or to be filed as an exhibit to the Registration Statement have been
so described or filed as required;

     (n) there are no actions, suits or proceedings pending or, to the best of
the Company's knowledge, threatened against the Company or any of its
Subsidiaries or any of their respective properties, at law or in equity, or
before or by any federal, state, local or foreign governmental or regulatory
commission, board, body, authority or agency which if adversely determined would
result in a judgment, decree or order having a material adverse effect on the
business, financial condition or property of the Company and its Subsidiaries
taken as a whole;

     (o) the audited consolidated financial statements of the Company and its
Subsidiaries incorporated by reference in the Registration Statement and the
Prospectus present fairly the consolidated balance sheet of the Company and its
Subsidiaries as of the dates indicated and the consolidated statements of income
and cash flows and changes in shareholders' equity of the Company and its
Subsidiaries for the periods specified; the financial statements of the Company
and its Subsidiaries have been prepared in conformity with generally accepted
accounting principles in the United States applied on a consistent basis during
the periods involved;

     (p) subsequent to the respective dates as of which information is given in
the Registration Statement and Prospectus, and except as may be otherwise stated
in the Registration Statement or Prospectus, there has not been (A) any material
and unfavorable change, financial or otherwise, in the business, properties,
business prospects, regulatory environment, results of operations or financial
condition of the Company and its Subsidiaries taken as a whole, (B) any
transaction, which is material to the Company and its Subsidiaries taken as a
whole, entered into by, or approved by the Board of Directors of, the Company or
any of its Subsidiaries or (C) any obligation, contingent or otherwise, directly
or indirectly incurred by the Company or any of its Subsidiaries which is
material to the Company and its Subsidiaries taken as a whole except for normal
trade obligations incurred in the ordinary course of the Company's business; and


<PAGE>
     (q) neither the Company nor any agent acting on its behalf has taken or
will take any action that might cause this Agreement, the Terms Agreement or
sale of the Securities to violate Regulation G, T, U or X of the Board of
Governors of the Federal Reserve System, in each case as in effect, or as the
same may hereafter be in effect, on the Closing Date;

     (r) except as described in the Registration Statement and the Prospectus,
(i) the operations of the Company and its Subsidiaries are in compliance with
all applicable environmental laws, except where the failure to comply with any
such laws, whether individually or in the aggregate, would not have a material
adverse effect on the operations, business or financial condition of the Company
and its Subsidiaries, taken as a whole, (ii) the Company and its Subsidiaries
have obtained all environmental, health and safety permits, licenses and
approvals necessary for its operation, all such permits, licenses and approvals
are in effect and the Company and its Subsidiaries are in compliance with the
terms and conditions thereof, except where the failure to obtain any such
permits, licenses or approvals, or to comply with the terms and conditions
thereof, whether individually or in the aggregate, would not have a material
adverse effect on the operations, business or financial condition of the Company
and its Subsidiaries, taken as a whole, (iii) with respect to any property
currently or formerly owned, leased or operated by the Company or any of its
Subsidiaries, (a) neither the Company nor any such Subsidiary is subject to any
judicial or administrative proceeding or any order from or agreement with any
governmental authority (collectively, "Proceedings"), and (b) the Company does
not have knowledge of any pending or threatened investigation by any
governmental authority (collectively, "Investigations") relating to any
violation or alleged violation of any environmental law, any release or
threatened release of a hazardous material into the environment, or any remedial
action that may be necessary in connection with any such violation or release,
except for such Proceedings or Investigations which, whether individually or in
the aggregate, are not expected to have a material adverse effect on the
operations, business or financial condition of the Company and its Subsidiaries,
taken as a whole, (iv) neither the Company nor any such Subsidiary has filed any
notice under any environmental law indicating past or present treatment,
storage, disposal or release of a hazardous material into the environment in a
manner that is not in compliance with, or which could result in liability under,
applicable environmental laws, except where such non-compliance or liability,
whether individually or in the aggregate, is not expected to have a material
adverse effect on the operations, business or financial condition of the Company
and its Subsidiaries, taken as a whole, and (v) neither the Company nor any such
Subsidiary has received notice of a claim that it may be subject to liability (a
"Notice") as a result of a release or threatened release of hazardous material,
except for such Notice which, whether individually or in the aggregate, are not
expected to have a material adverse effect on the operations, business or
financial condition of the Company and its Subsidiaries taken as a whole and to
the best of the Company's knowledge there is no reasonable basis for any such
claim, action, suit or investigation with respect to any environmental law;

     (s) the Company is not an "investment company" or an affiliated person of,
or "promoter" or "principal underwriter" for, an "investment company," as such
terms are defined in the Investment Company Act of 1940, as amended, and the
rules and regulations thereunder; and

     (t) to the best knowledge of the Company, no labor problem exists with
employees of the Company or any of its Subsidiaries that would have a material
adverse effect on the Company and its Subsidiaries taken as a whole.

     3. CERTAIN COVENANTS OF THE COMPANY. The Company hereby agrees:

     (a) to furnish such information as you may reasonably require and otherwise
to cooperate with you in qualifying the Securities for offering and sale under
the securities or blue sky laws of such states as you may designate (including
the provisions of Florida blue sky law, if requested, relating to issuers doing
business with Cuba) and to maintain such qualifications in effect so long as
required for the distribution of the Securities, provided that the Company shall
not be required to qualify as a foreign corporation or to consent to the service
of process under the laws of any such state (except service of process with
respect to the offering and sale of the Securities); and to promptly advise you
of the receipt by the Company of any notification with respect to the suspension
of the qualification of the Securities for sale in any jurisdiction or the
initiation or threatening of any proceeding for such purpose;

     (b) to make available to you in New York City, as soon as practicable after
the Registration Statement becomes effective, and thereafter from time to time
to furnish to the Underwriters, as many copies of the Prospectus (or of the
Prospectus as amended or supplemented if the Company shall have made any
amendments or supplements thereto after the effective date of the Registration
Statement) as the Underwriters may reasonably request for the purposes
contemplated by the Act;

     (c) that it will use its best efforts to cause any amendment of the
Registration Statement to become effective promptly. The Company will not file
any amendment to the Registration Statement or amendment or supplement to the
Prospectus relating to any series of the Securities to which the Underwriters of
such series shall object in writing after a reasonable opportunity to review the
same. Subject to the foregoing sentence, the Company will cause each Prospectus
supplement relating to the Securities to be filed with the Commission pursuant
to the applicable paragraph of Rule 424 within the time period prescribed and
will provide evidence satisfactory to the Underwriters of such timely filing.
The Company will


<PAGE>
promptly advise the Underwriters of any series of Securities (A) when any
Prospectus supplement relating to such series shall have been filed with the
Commission pursuant to Rule 424, (B) when, prior to termination of the offering
of such series, any amendment to the Registration Statement shall have been
filed with the Commission or become effective, (C) of any request by the
Commission for any amendment of the Registration Statement or supplement to the
Prospectus or for any additional information, (D) of the receipt by the Company
of any notification of the issuance by the Commission of any stop order
suspending the effectiveness of the Registration Statement or the use of any
Prospectus or Prospectus supplement or, if the Company has knowledge, of the
institution or threat of any proceeding for that purpose and (E) of the receipt
by the Company of any notification with respect to the suspension of the
qualifications of the Securities for sale in any jurisdiction or, if the Company
has knowledge, of the initiation or threat of any proceeding for such purpose.
The Company will make every reasonable effort to prevent the issuance of any
such stop order or of any order suspending or preventing any such use and, if
issued, to obtain as soon as possible the withdrawal thereof;

     (d) to furnish to you and to each of the other Underwriters for a period of
five years from the date of each Terms Agreement, as requested, (i) copies of
any reports or other communications which the Company shall send to its
stockholders or shall from time to time publish or publicly disseminate, (ii)
copies of all annual, quarterly and current reports filed with the Commission on
Forms 10-K, 10-Q and 8-K, or such other similar form as may be designated by the
Commission, to the extent not readily available from public sources, and (iii)
such other information as you may reasonably request regarding the Company or
its Subsidiaries;

     (e) to advise the Underwriters of a series of Securities promptly of the
happening of any event known to the Company within the time during which a
prospectus relating to such series is required to be delivered under the Act
which, in the judgment of the Company, would require the making of any change in
the Prospectus then being used, or in the information incorporated therein by
reference, so that the Prospectus would not include an untrue statement of
material fact or omit to state a material fact necessary to make the statements
therein, in the light of the circumstances under which they are made, not
misleading, and, during such time, to prepare and furnish, at the Company's
expense, to the Underwriters promptly such amendments or supplements to such
Prospectus as may be necessary to reflect any such change and to furnish you a
copy of such proposed amendment or supplement before filing any such amendment
or supplement with the Commission;

     (f) that, as soon as practicable after the date of each Terms Agreement,
the Company will make generally available to its Security holders an earnings
statement of the Company which will satisfy the provisions of Section 11(a) of
the Act and Rule 158 under the Act;

     (g) to apply the net proceeds from the sale of the Securities in the manner
set forth under the caption "Use of Proceeds" in the Prospectus supplement
relating to the Securities or, if none is provided, under such caption in the
Prospectus;

     (h) to pay all expenses, fees and taxes (other than any transfer taxes and
fees and disbursements of counsel for the Underwriters except as set forth under
Section 4 hereof and (iii) and (iv) below) in connection with (i) the
preparation and filing of the Registration Statement, each preliminary
Prospectus, the Prospectus, and any amendments or supplements thereto, and the
printing and furnishing of copies of each thereof to the Underwriters and to
dealers (including costs of mailing and shipment), (ii) the preparation,
issuance, execution, authentication and delivery of the Securities, (iii) the
reproduction and furnishing of copies of this Agreement, the Terms Agreement,
any Agreement Among Underwriters, any dealer agreements, any Statements of
Information and Powers of Attorney and the Indenture to the Underwriters and to
dealers (including costs of mailing and shipment), (iv) the qualification of the
Securities for offering and sale under state laws and the determination of their
eligibility for investment under state law as aforesaid (including the legal
fees and filing fees and other disbursements of counsel for the Underwriters)
and the furnishing of copies of any blue sky surveys or legal investment surveys
to the Underwriters and to dealers, (v) any fees payable to investment rating
agencies with respect to the Securities, (vi) any filing for review of the
underwriting arrangements for the public offering of the Shares by the National
Association of Securities Dealers, Inc. ("NASD") and (vii) the performance of
the Company's other obligations hereunder (it is understood, however, that
except as provided in this subsection 3(h), Section 4 and Section 8 hereof, the
Underwriters will pay all of their own costs and expenses, including the fees
and disbursements of their counsel, transfer taxes on resale of any of the
Securities by them, and any advertising expenses connected with any offers they
may make);

     (i) that the Company will not, without your prior written consent, offer or
sell, or publicly announce its intention to offer or sell, (i) any debt
securities pursuant to a public offering or (ii) any unsecured debt securities
pursuant to a private placement which contemplates the purchasers of such debt
securities receiving customary registration rights in each case during the
period beginning on the date of the Terms Agreement and ending on the 30th day
following the date of the Terms Agreement. The Company has not taken, and will
not take, any action which might reasonably be expected to cause or result in
the stabilization or manipulation of the price of any security to facilitate the
sale or resale of the Securities.


<PAGE>
     4. REIMBURSEMENT OF UNDERWRITERS' EXPENSES. If the Securities of a series
to which a Terms Agreement relates are not delivered for any reason other than
the termination of the obligations of the several Underwriters in accordance
with Section 8 hereof or the default by one or more of the Underwriters in its
or their respective obligations to purchase Securities pursuant to any Terms
Agreement, the Company shall reimburse the Underwriters for all of their
out-of-pocket expenses, including the fees and disbursements of their counsel.

     5. CONDITIONS OF UNDERWRITERS' OBLIGATIONS. The several obligations of the
Underwriters to purchase and pay for the Securities under any Terms Agreement
are subject to the accuracy of the representations and warranties on the part of
the Company on the date of such Terms Agreement and at the Closing Date, to the
accuracy of the statements of officers of the Company made pursuant to the
provisions hereof, to the performance by the Company of its obligations
hereunder and to the following conditions:

     (a) The Company shall furnish to you at the Closing Date a written opinion
from James M. White, III, Secretary and General Counsel of the Company, or
Francis V. Lowden, III, Assistant Secretary of the Company, addressed to the
Underwriters, and dated the Closing Date, with reproduced copies for each of the
other Underwriters and in form and substance satisfactory to Sullivan &
Cromwell, counsel for the Underwriters, substantially to the effect that:

          (i) each of the Material Subsidiaries has been duly incorporated and
     is validly existing as a corporation in good standing under the laws of its
     respective jurisdiction of incorporation with full corporate power and
     authority to own its respective properties and to conduct its respective
     business; each of the Subsidiaries which are not Material Subsidiaries has
     been duly incorporated and is validly existing as a corporation in good
     standing under the laws of its respective jurisdiction of incorporation
     with full corporate power and authority to own its respective properties
     and to conduct its respective business in each jurisdiction in which the
     failure to do so, individually or in the aggregate, would have a material
     adverse effect on the operations, business or financial condition of the
     Company and its Subsidiaries, taken as a whole;

          (ii) the Company and its Material Subsidiaries are duly qualified or
     licensed by each jurisdiction in which they conduct their respective
     businesses and in which the failure, individually or in the aggregate, to
     be so licensed or qualified would have a material adverse effect on the
     operations, business or financial condition of the Company and its
     Subsidiaries taken as a whole, and the Company and its Material
     Subsidiaries are duly qualified, and are in good standing, in each
     jurisdiction in which they own or lease real property or maintain an office
     in which the failure to do so, individually or in the aggregate, would have
     a material adverse effect on the operations, business or financial
     condition of the Company and its Subsidiaries, taken as a whole;

          (iii) the execution, delivery and performance of this Agreement, the
     Terms Agreement and the Indenture by the Company and the issuance of the
     Securities and the consummation by the Company of the transactions
     contemplated hereby and thereby do not and will not conflict with, or
     result in any breach of, or constitute a default under (nor constitute any
     event which with notice, lapse of time, or both, would constitute a breach
     of or default under), any provisions of the charter or by-laws of the
     Company or any of its Subsidiaries or under any provision of any license,
     indenture, mortgage, deed of trust, bank loan, credit agreement or other
     agreement or instrument to which the Company or any of its Subsidiaries is
     a party or by which any of them or their respective properties may be bound
     or affected, or under any law, regulation or rule or any decree, judgment
     or order applicable to the Company or any of its Subsidiaries in which such
     conflict, breach or default, individually or in the aggregate, would have a
     material adverse effect on the operations, business or financial condition
     of the Company and its Subsidiaries, taken as a whole;

          (iv) to such counsel's knowledge, neither the Company nor any of its
     Subsidiaries is in breach of, or in default under (nor has any event
     occurred which with notice, lapse of time, or both would constitute a
     breach of, or default under), any license, indenture, mortgage, deed of
     trust, bank loan or any other agreement or instrument to which the Company
     or any of its Subsidiaries is a party or by which any of them or their
     respective properties may be bound or affected by or under any law,
     regulation or rule or any decree, judgment or order applicable to the
     Company or any of its Subsidiaries in which such breach or default,
     individually or in the aggregate, would have a material adverse effect on
     the operations, business or financial condition of the Company and its
     Subsidiaries, taken as a whole; and

          (v) to such counsel's knowledge, there are no actions, suits or
     proceedings pending or threatened against the Company or any of its
     Subsidiaries or any of their respective properties, at law or in equity or
     before or by any commission, board, body, authority or agency which are
     required to be described in the Prospectus but are not so described.

     (b) The Company shall furnish to you at the Closing Date an opinion of
McGuire, Woods, Battle & Booth, L.L.P., counsel for the Company, in each case
addressed to the Underwriters, and dated the Closing Date, with reproduced
copies for each of the other Underwriters and in form and substance satisfactory
to Sullivan & Cromwell, counsel to the Underwriters, substantially to the effect
that:


<PAGE>
          (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, with full corporate power and authority to own its properties and
     conduct its business as described in the Registration Statement and the
     Prospectus, to execute and deliver this Agreement, the Terms Agreement and
     the Indenture and to issue and sell the Securities as herein and therein
     contemplated;

          (ii) the Indenture has been duly authorized by all necessary corporate
     action on the part of the Company, executed and delivered by the Company
     and (assuming the Indenture has been duly authorized, executed and
     delivered by the Trustee) constitutes a valid and legally binding
     obligation of the Company enforceable against the Company in accordance
     with its terms, subject to bankruptcy, insolvency, fraudulent
     transfer,reorganization, moratorium and similar laws of general
     applicability relating to or affecting creditors' rights and to general
     equity principles;

          (iii) the Securities have been duly authorized by all necessary
     corporate action on the part of the Company, executed and delivered by the
     Company and constitute valid and legally binding obligations of the Company
     enforceable against the Company in accordance with their terms, subject to
     bankruptcy, insolvency, fraudulent transfer, reorganization, moratorium and
     similar laws of general applicability relating to or affecting creditors'
     rights and to general equity principles;

          (iv) this Agreement and the Terms Agreement have been duly authorized,
     executed and delivered by the Company;

          (v) the Securities and the Indenture conform in all material respects
     to the description thereof contained in the Registration Statement and
     Prospectus;

          (vi) the Registration Statement and the Prospectus (except as to the
     financial statements and schedules and other financial and statistical data
     contained or incorporated by reference therein, as to which such counsel
     need express no opinion) appear on their face to be appropriately
     responsive in all material respects to the requirements of the Act;

          (vii) the Registration Statement has become effective under the Act
     and, to such counsel's knowledge, no stop order proceedings with respect
     thereto are pending or threatened under the Act;

          (viii) no approval, authorization, consent or order of or filing with
     any court or governmental agency or body is required on the part of the
     Company in connection with the issuance and sale of the Securities as
     contemplated hereby other than registration of the Securities under the Act
     and qualification of the Indenture under the Trust Indenture Act (except
     such counsel need express no opinion as to any necessary qualification
     under the state securities or blue sky laws of the various jurisdictions in
     which the Shares are being offered by the Underwriters);

          (ix) to such counsel's knowledge, there are no contracts, licenses,
     agreements, leases or documents of a character which are required to be
     filed as exhibits to the Registration Statement or to be summarized or
     described in the Prospectus which have not been so filed, summarized or
     described; and

          (x) the documents incorporated by reference in the Registration
     Statement and Prospectus (except as to the financial statements and
     schedules and other financial and statistical data contained or
     incorporated therein as to which such counsel need express no opinion),
     when they were filed (or, if an amendment with respect to any such document
     was filed when such amendment was filed), appear on their face to be
     appropriately responsive in all material respects to the requirements of
     the Exchange Act.

     In addition, such counsel shall state that they have participated in
conferences with officers and other representatives of the Company,
representatives of the independent public accountants of the Company and
representatives of the Underwriters at which the contents of the Registration
Statement and Prospectus were discussed and, although such counsel has not
undertaken to investigate or verify independently and does not assume any
responsibility for, the accuracy, completeness or fairness of the statements
contained in the Registration Statement or Prospectus or documents incorporated
by reference therein, and did not participate in the preparation of the
documents incorporated by reference into the Registration Statement or
Prospectus, on the basis of the foregoing (relying as to materiality to a large
extent upon theopinions of officers and other representatives of the Company)
nothing has come to the attention of such counsel that causes them to believe
that the Registration Statement or any amendment thereto at the time such
Registration Statement or amendment became effective contained an untrue
statement of a material fact or omitted to state a material fact required to be
stated therein or necessary to make the statements therein not misleading, or
that the Prospectus or any supplement thereto at the date of such Prospectus or
such supplement, and at all times up to and including the Closing Date,
contained an untrue statement of a material fact or omitted to state a material
fact required to be stated therein or necessary to make the statements therein,
in light of the circumstances under which they were made, not misleading (it
being understood that such counsel need express no opinion with respect to the
financial statements and schedules and other financial and statistical data
included in the Registration Statement or Prospectus or the Statement of
Eligibility and Qualification of the Trustee on Form T-1 filed as an exhibit to
the Registration Statement).


<PAGE>
     (c) You shall have received from the Company's independent public
accountants letters dated the date of the Terms Agreement and the Closing Date,
and addressed to the Underwriters (with reproduced copies for each of the
Underwriters) in the forms heretofore approved by you.

     (d) You shall have received at the Closing Date the favorable opinion of
Sullivan & Cromwell, counsel for the Underwriters, dated the Closing Date, in
form and substance reasonably satisfactory to you.

     (e) Prior to the Closing Date, (i) no stop order with respect to the
effectiveness of the Registration Statement shall have been issued under the Act
or proceedings initiated under Section 8(d) or 8(e) of the Act; (ii) the
Registration Statement and all amendments thereto, or modifications thereof, if
any, shall not contain an untrue statement of a material fact or omit to state a
material fact required to be stated therein or necessary to make the statement
therein not misleading; and (iii) the Prospectus and all amendments or
supplements thereto, or modifications thereof, if any, shall not contain an
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, in the light of
the circumstances under which they are made, not misleading.

     (f) Between the time of execution of the Terms Agreement and the Closing
Date, (i) no material and unfavorable change, financial or otherwise (other than
as referred to in the Registration Statement and Prospectus), in the business,
financial condition or business prospects of the Company and its Subsidiaries
taken as a whole shall occur or become known and (ii) no transaction which is
material and unfavorable to the Company and its Subsidiaries taken as a whole
shall have been entered into by, or approved by the Board of Directors of, the
Company or any of its Subsidiaries.

     (g) The Company will, at the Closing Date, deliver to you a certificate of
one of its executive officers in which such executiveofficer shall state, to the
best of his or her knowledge, that the representations and warranties of the
Company as set forth in this Agreement and the conditions set forth in paragraph
(e) and paragraph (f) have been met and that they are true and correct as of
each such date.

     (h) The Company shall have furnished to you such other documents and
certificates as to the accuracy and completeness of any statement in the
Registration Statement and the Prospectus as of the Closing Date, as you may
reasonably request.

     (i) The Company shall perform such of its obligations under this Agreement
and the Terms Agreement as are to be performed by the terms hereof at or before
the Closing Date.

     (j) At the Closing Date, counsel for the Underwriters shall have been
furnished with such information, certificates and documents as they may
reasonably require for the purpose of enabling them to pass upon the issuance
and sale of the Securities as contemplated herein and related proceedings, or in
order to evidence the accuracy of any of the representations or warranties, or
the fulfillment of any of the conditions, herein contained; and all opinions and
certificates mentioned above or elsewhere in this Agreement shall be reasonably
satisfactory in form and substance to the Representatives and counsel for the
Underwriters.

     6. TERMINATION OF TERMS AGREEMENT. The obligations of the several
Underwriters hereunder shall be subject to termination in the absolute
discretion of you or any group of Underwriters (which may include you) which has
agreed pursuant to the Terms Agreement to purchase in the aggregate at least 50%
of the Securities, if, at any time between the time of execution of the Terms
Agreement and the Closing Date, (a) trading in securities generally on the New
York Stock Exchange shall have been suspended or minimum prices shall have been
established on the New York Stock Exchange, (b) a downgrading shall have
occurred in the rating accorded the Company's debt securities by any "nationally
recognized statistical rating organization," as that term is defined by the
Commission for purposes of Rule 436(g)(2) of the rules and regulations
promulgated under the Act or such organization shall have publicly announced
that it has under surveillance or review, other than with possible positive
implications, its rating of any of the Company's debt securities, (c) a banking
moratorium shall have been declared either by the United States or New York
State authorities, or (d) the United States shall have declared war in
accordance with its constitutional processes or there shall have occurred any
material outbreak or escalation of hostilities or other national or
international calamity or crisis of such magnitude in its effect on the
financial markets of the United States as, in your judgment or in the judgment
of such group of Underwriters, to make it impracticable to market the
Securities.

     If you or any group of Underwriters elects to terminate this Agreement as
provided in this Section 6, the Company and each other Underwriter shall be
notified promptly by letter or telegram.

     If the sale to the Underwriters of the Securities, ascontemplated by this
Agreement and the Terms Agreement, is not carried out by the Underwriters for
any reason permitted under this Agreement or if such sale is not carried out
because the Company shall be unable to comply with any of the terms of this
Agreement, the Company shall not be under any obligation or liability under this
Agreement (except to the extent provided in Sections 3(h), 4 and 8 hereof), and
the Underwriters shall be under no obligation or liability to the Company under
this Agreement (except to the extent provided in Section 8 hereof) or to one
another hereunder.


<PAGE>
     7. INCREASE IN UNDERWRITERS' COMMITMENTS. If any Underwriter shall default
in its obligation to take up and pay for the Securities to be purchased by it
under any Terms Agreement and if the principal amount of Securities which all
Underwriters so defaulting shall have agreed but failed to take up and pay for
does not exceed 10% of the total principal amount of Securities agreed to be
purchased pursuant to such Terms Agreement, the non-defaulting Underwriters
shall take up and pay for (in addition to the principal amount of Securities
they are obligated to purchase pursuant to such Terms Agreement) the principal
amount of Securities agreed to be purchased by all such defaulting Underwriters,
as hereinafter provided. Such Securities shall be taken up and paid for by such
non-defaulting Underwriter or Underwriters, as hereinafter provided. Such
Securities shall be taken up and paid for by such non-defaulting Underwriter or
Underwriters in such amount or amounts as you may designate with the consent of
each Underwriter so designated or, in the event no such designation is made,
such Securities shall be taken up and paid for by all non-defaulting
Underwriters pro rata in proportion to the principal amount of Securities they
have agreed to purchase under such Terms Agreement.

     Without relieving any defaulting Underwriter from its obligations
hereunder, the Company agrees with the non-defaulting Underwriters that it will
not sell any Securities under any Terms Agreement unless all of the Securities
under such Terms Agreement are purchased by the Underwriters (or by substituted
Underwriters selected by you with the approval of the Company or selected by the
Company with your approval).

     If a new Underwriter or Underwriters are substituted by the Underwriters or
by the Company for a defaulting Underwriter or Underwriters in accordance with
the foregoing provision, the Company or you shall have the right to postpone the
time of purchase for a period not exceeding five business days in order that any
necessary changes in the Registration Statement and Prospectus and other
documents may be effected.

     The term Underwriter as used in this Agreement shall refer to and include
any Underwriter substituted under this Section 7.

     8. INDEMNITY BY THE COMPANY AND THE UNDERWRITERS.

     (a) The Company agrees to indemnify, defend and hold harmless each
Underwriter and any person who controls any Underwriter within the meaning of
Section 15 of the Act or Section 20 of the Exchange Act, from and against any
loss, expense, liability or claim (including the reasonable cost of
investigation) which, jointly or severally, any such Underwriter or any such
controlling person may incur under the Act, the Exchange Act or otherwise
insofar as such loss, expense, liability or claim arises out ofor is based upon
any untrue statement or alleged untrue statement of a material fact contained in
the Registration Statement (or in the Registration Statement as amended by any
post-effective amendment thereof by the Company) or in a Prospectus (the term
Prospectus for the purpose of this Section 8 being deemed to include any
Preliminary Prospectus, the Prospectus and the Prospectus as amended or
supplemented by the Company), or arises out of or is based upon any omission or
alleged omission to state a material fact required to be stated in either such
Registration Statement or Prospectus or necessary to make the statements made
therein not misleading, except insofar as any such loss, expense, liability, or
claim arises out of or is based upon any untrue statement or alleged untrue
statement of a material fact contained in and in conformity with information
furnished in writing by any Underwriter through you to the Company expressly for
use in such Registration Statement or such Prospectus or arises out of or is
based upon any omission or alleged omission to state a material fact in
connection with such information required to be stated in either such
Registration Statement or Prospectus or necessary to make such information not
misleading; provided, however, that the indemnity agreement contained in this
subsection (a) with respect to any Preliminary Prospectus or amended Preliminary
Prospectus shall not inure to the benefit of any Underwriter (or to the benefit
of any person controlling such Underwriter) from whom the person asserting any
such loss, expense, liability or claim purchased the Securities which is the
subject thereof if the Prospectus corrected any such alleged untrue statement or
omission and if such Underwriter failed to send or give a copy of the Prospectus
to such person at or prior to the written confirmation of the sale of such
Securities to such person.

     If any action is brought against an Underwriter or controlling person in
respect of which indemnity may be sought against the Company pursuant to the
foregoing paragraph, such Underwriter shall promptly notify the Company in
writing of the institution of such action and the Company shall assume the
defense of such action, including the employment of counsel and payment of
expenses. Such Underwriter or such controlling person shall have the right to
employ its or their own counsel in any such case, but the fees and expenses of
such counsel shall be at the expense of such Underwriter or of such controlling
person unless the employment of such counsel shall have been authorized in
writing by the Company in connection with the defense of such action or the
Company shall not have employed counsel to have charge of the defense of such
action or such indemnified party or parties shall have reasonably concluded that
there may be defenses available to it or them which are different from or
additional to those available to the Company (in which case the Company shall
not have the right to direct the defense of such action on behalf of the
indemnified party or parties), in any of which events such fees and expenses
shall be borne by the Company and paid as incurred (it being understood,
however, that the Company shall not be liable for the expenses of more than one
separate counsel in any one action or series of related actions in the same
jurisdiction representing


<PAGE>
the indemnified parties who are parties to such action). Anything in this
paragraph to the contrary notwithstanding, the Company shall not be liable for
any settlement of any such claim or action effected without its written consent.

     (b) Each Underwriter severally agrees to indemnify, defend and hold
harmless the Company, its directors and officers, and any person whocontrols the
Company within the meaning of Section 15 of the Act or Section 20 of the
Exchange Act from and against any loss, expense, liability or claim (including
the reasonable cost of investigation) which, jointly or severally, the Company
or any such person may incur under the Act or otherwise, insofar as such loss,
expense, liability or claim arises out of or is based upon any untrue statement
or alleged untrue statement of a material fact contained in and in conformity
with information furnished in writing by or on behalf of such Underwriter
through you to the Company expressly for use in the Registration Statement (or
in the Registration Statement as amended by post-effective amendment thereof by
the Company) or in a Prospectus, or arises out of or is based upon any omission
or alleged omission to state a material fact in connection with such information
required to be stated either in such Registration Statement or Prospectus or
necessary to make such information not misleading.

     If any action is brought against the Company or any such person in respect
of which indemnity may be sought against any Underwriter pursuant to the
foregoing paragraph, the Company or such person shall promptly notify such
Underwriter in writing of the institution of such action and such Underwriter
shall assume the defense of such action, including the employment of counsel and
payment of expenses. The Company or such person shall have the right to employ
its own counsel in any such case, but the fees and expenses of such counsel
shall be at the expense of the Company or such person unless the employment of
such counsel shall have been authorized in writing by such Underwriter in
connection with the defense of such action or such Underwriter shall not have
employed counsel to have charge of the defense or such action or such
indemnified party or parties shall have reasonably concluded that there may be
defenses available to it or them which are different from or additional to those
available to such Underwriter (in which case such Underwriter shall not have the
right to direct the defense of such action on behalf of the indemnified party or
parties), in any of which events such fees and expenses shall be borne by such
Underwriter and paid as incurred (it being understood, however, that such
Underwriter shall not be liable for the expenses of more than one separate
counsel in any one action or series of related actions in the same jurisdiction
representing the indemnified parties who are parties to such action). Anything
in this paragraph to the contrary notwithstanding, no Underwriter shall be
liable for any settlement of any such claim or action effected without the
written consent of such Underwriter.

     (c) If the indemnification provided for in this Section 8 is unavailable to
an indemnified party under subsections (a) and (b) of this Section 8 in respect
of any losses, expenses, liabilities or claims referred to therein, then each
applicable indemnifying party, in lieu of indemnifying such indemnified party,
shall contribute to the amount paid or payable by such indemnified party as a
result of such losses, expenses, liabilities or claims (i) in such proportion as
is appropriate to reflect the relative benefits received by the Company on the
one hand and the Underwriters on the other hand from the offering of the
Securities or (ii) if the allocation provided by clause (i) above is not
permitted by applicable law, in such proportion as is appropriate to reflect not
only the relative benefits referred to in clause (i) above but also the relative
fault of the Company on the one hand and of the Underwriters on the other in
connection with the statements or omissions which resulted in suchlosses,
expenses, liabilities or claims, as well as any other relevant equitable
considerations. The relative benefits received by the Company on the one hand
and the Underwriters on the other shall be deemed to be in the same proportion
as the total proceeds from the offering (net of underwriting discounts and
commissions but before deducting expenses) received by the Company bear to the
total underwriting discounts and commissions received by the Underwriters. The
relative fault of the Company on the one hand and of the Underwriters on the
other shall be determined by reference to, among other things, whether the
untrue statement or alleged untrue statement of a material fact or omission or
alleged omission relates to information supplied by the Company or by the
Underwriters and the parties' relative intent, knowledge, access to information
and opportunity to correct or prevent such statement or omission. The amount
paid or payable by a party as a result of the losses, expenses, liabilities and
claims referred to above shall be deemed to include any legal or other fees or
expenses reasonably incurred by such party in connection with investigating or
defending any claim or action.

     (d) The Company and the Underwriters agree that it would not be just and
equitable if contribution pursuant to this Section 8 were determined by pro rata
allocation (even if the Underwriters were treated as one entity for such
purpose) or by any other method of allocation that does not take account of the
equitable considerations referred to in subsection (c) above. Notwithstanding
the provisions of this Section 8, no Underwriter shall be required to contribute
any amount in excess of the amount by which the total price at which the
Securities underwritten by such Underwriter and distributed to the public were
offered to the public exceeds the amount of any damages which such Underwriter
has otherwise been required to pay by reason of such untrue statement or alleged
untrue statement or omission or alleged omission. No person guilty of fraudulent
misrepresentation (within the meaning of Section 11(f) of the Act) shall be
entitled to contribution from any person who was not guilty of such fraudulent
misrepresentation. The Underwriter's obligations to contribute pursuant to this
Section 8 are several in proportion to their respective underwriting commitments
and not joint.


<PAGE>
     (e) The indemnity and contribution agreements contained in this Section 8
and the covenants, warranties and representations of the Company contained in
this Agreement and the Terms Agreement shall remain in full force and effect
regardless of any investigation made by or on behalf of any Underwriter, or any
person who controls any Underwriter within the meaning of Section 15 of the Act
or Section 20 of the Exchange Act, or by or on behalf of the Company, its
directors and officers or any person who controls the Company within the meaning
of Section 15 of the Act or Section 20 of the Exchange Act, and shall survive
any termination of this Agreement or the issuance and delivery of the
Securities. The Company and each Underwriter agree promptly to notify the others
of the commencement of any litigation or proceeding against it and, in the case
of the Company, against any of the Company's officers and directors in
connection with the issuance and sale of the Securities, or in connection with
the Registration Statement or Prospectus.

     9. NOTICES. Except as otherwise herein provided, all statements, requests,
notices and agreements shall be in writing or by telegram and, if to the
Underwriters, shall be sufficient in all respectsif delivered or sent to Dillon,
Read & Co. Inc., 535 Madison Avenue, New York, N.Y. 10022, Attention: Syndicate
Department or to any other Underwriters at their addresses furnished to the
Company in the Terms Agreement and, if to the Company, shall be sufficient in
all respects if delivered or sent to the Company at the offices of the Company
at 1501 N. Hamilton Street, Richmond, Virginia 23230, Attention: James M. White,
III, Secretary and General Counsel.

     10. CONSTRUCTION. This Agreement and the Terms Agreement shall be governed
by, and construed in accordance with, the laws of the State of New York. The
Section headings in this Agreement have been inserted as a matter of convenience
of reference and are not a part of this Agreement.

     11. PARTIES AT INTEREST. The Agreement herein set forth and the Terms
Agreement have been and are made solely for the benefit of the Underwriters and
the Company and the controlling persons, directors and officers referred to in
Section 8 hereof, and their respective successors, assigns, executors and
administrators. No other person, partnership, association or corporation
(including a purchaser, as such purchaser, from any of the Underwriters) shall
acquire or have any right under or by virtue of this Agreement or the Terms
Agreement.

     12. COUNTERPARTS. This Agreement may be signed by the parties in
counterparts which together shall constitute one and the same agreement among
the parties.

     If the foregoing correctly sets forth the understanding among the Company
and you, please so indicate in the space provided below for the purpose,
whereupon this letter and your acceptance shall constitute a binding agreement
between us.

                                      Very truly yours,

                                      UNIVERSAL CORPORATION

                                      By

                                          Title:

[REPRESENTATIVE[S] OF THE UNDERWRITERS]

By

    Title:


<PAGE>
                                   SCHEDULE A


<TABLE>
<CAPTION>
                                                                                                                  ORGANIZED
MATERIAL SUBSIDIARY                                                                                             UNDER LAW OF
<S>                                                                                                            <C>
Universal Leaf Tobacco Company, Incorporated................................................................   Virginia
K.R. Edwards Leaf Tobacco Company, Incorporated.............................................................   Virginia
Casa Export Limited.........................................................................................   Virginia
Lancaster Leaf Tobacco Company of Pennsylvania, Inc.........................................................   Virginia
Southern Processors, Incorporated...........................................................................   Virginia
Southwestern Tobacco Company, Incorporated..................................................................   Virginia
J. P. Taylor Company, Incorporated..........................................................................   Virginia
Thorpe & Ricks, Inc.........................................................................................   Virginia
Thorpe-Greenville Export Tobacco Company....................................................................   North Carolina
Deltafina, S.p.A............................................................................................   Italy
Universal Leaf Tobaccos Ltda................................................................................   Brazil
Gebrueder Kulenkampff, Inc..................................................................................   Virginia
Gebrueder Kulenkampff AG....................................................................................   Germany
Universal Leaf P.H., Inc....................................................................................   Virginia
Deli Universal, Inc.........................................................................................   Virginia
N.V. Deli Universal.........................................................................................   Netherlands
Jongeneel Holding B.V.......................................................................................   Netherlands
Jongeneel B.V...............................................................................................   Netherlands
Casalee, Incorporated.......................................................................................   Virginia
</TABLE>



<PAGE>
                                   SCHEDULE B

                                TERMS AGREEMENT

                        [  ]% NOTES DUE [         ], 199

                                        [      ], 199

Universal Corporation
1501 North Hamilton Street
Richmond, Virginia 23260

Dear Sirs:

     Universal Corporation, a Virginia corporation (the "Company"), and
                  have entered into an Underwriting Agreement (the "Underwriting
Agreement"), dated [  ], 199 , relating to the issuance from time to time by the
Company of its debt securities under an indenture (the "Indenture"), dated as of
February 1, 1991, between the Company and Chemical Bank, as Trustee. This Terms
Agreement, relating to the Securities referred to below, is being entered into
pursuant to the Underwriting Agreement. Capitalized terms used herein and not
otherwise defined have the meanings given them in the Underwriting Agreement.

                       and the several other underwriters named in Schedule A
annexed hereto (the "Underwriters") understand that the Company proposes to
issue and sell $[       ] aggregate principal amount of [  ]% Notes Due
[            ] (the "Securities"). Subject to the terms, conditions,
representations and warranties set forth or incorporated by reference herein,
the Company agrees to sell to the Underwriters and the Underwriters agree to
purchase from the Company the Securities at [  ]% of the principal amount
thereof plus accrued interest from [                 ] 199 , if any, to the
Closing Date referred to below. The Prospectus Supplement with respect to the
Purchased Securities is dated [               ] and includes the Prospectus
dated [               ].

     The Underwriters will pay for such Securities upon delivery thereof in New
York, New York at [     ] a.m. (New York time) on [                  ] (the
"Closing Date") by wire transfer of immediately available funds, or at such
other time on the Closing Date as shall be agreed upon by the Company and the
Underwriters.


<PAGE>
     The Purchased Securities shall be issued in book-entry form and shall have
the following terms:


<TABLE>
     <S>                                    <C>
     (a) Interest:                          [  ]% per annum
     (b) Maturity:                          [                  ]
                                            [       ]% of the principal amount of the
                                            Purchased Securities plus accrued interest from
     (c) Initial Public Offering Price:     [          ], if any.
                                            [               ] and [               ],
     (d) Interest Payment Dates:            commencing [               ]
     (e) Regular Record Dates:              [               ] and [               ]
     (f) Optional Redemption:               [               ]
</TABLE>


     All provisions contained in the Underwriting Agreement are incorporated by
reference herein in their entirety and shall be deemed to be part of this
Agreement to the same extent as if such provisions had beenset forth in full
herein.

     This Agreement shall be governed by, and construed in accordance with, the
laws of the State of New York.

     This instrument may be signed by the parties in counterparts which together
shall constitute one and the same agreement between the parties and shall become
effective at such time as each of the parties shall have signed such
counterparts and shall have notified the other party thereof.

     Please confirm your agreement herewith by having an authorized officer sign
a copy of this Agreement in the space provided below:

                                      Very truly yours,

                                        as Representative

                                      By:

Accepted and Agreed to as of
the Date First Above Written:

UNIVERSAL CORPORATION

By:


<PAGE>
                                   EXHIBIT A


<TABLE>
<CAPTION>
                                                                                                                     PRINCIPAL
                                                                                                                     AMOUNT OF
                                                       NAME                                                            NOTES
<S>                                                                                                                  <C>
[               ].................................................................................................    $
[               ].................................................................................................
[               ].................................................................................................
  Total:                                                                                                              $


</TABLE>




                                                                    EXHIBIT 23.1

               CONSENT OF ERNST & YOUNG LLP, INDEPENDENT AUDITORS

     We consent to the reference to our firm under the caption "Experts" in
Amendment No. 1 to the Registration Statement (Form S-3 No. 33-65079) and
related Prospectus of Universal Corporation for the registration of $200,000,000
of Debt Securities and to the incorporation by reference therein of our report
dated August 3, 1995, with respect to the consolidated financial statements of
Universal Corporation included in its Annual Report (Form 10-K) for the year
ended June 30, 1995, filed with the Securities and Exchange Commission.

                                      ERNST & YOUNG LLP

Richmond, Virginia

February 1, 1996