As filed with the Securities and Exchange Commission on April 22, 1997
File No. 333-
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
Form S-8
REGISTRATION STATEMENT
Under
THE SECURITIES ACT OF 1933
Dominion Resources, Inc.
(Exact name of registrant as specified in its charter)
VIRGINIA 54-1229715
(State or other jurisdiction (I.R.S. Employer
of incorporation or Identification No.)
organization)
901 EAST BYRD STREET, RICHMOND, VIRGINIA 23219
(Address of principal executive office, including zip code)
DOMINION RESOURCES, INC.
INCENTIVE COMPENSATION PLAN
(Full Title of the Plan)
Patricia A. Wilkerson, Corporate Secretary
W. H. Riggs, Jr., Assistant Corporate Secretary
DOMINION RESOURCES, INC.
901 E. Byrd Street, Richmond, Virginia 23219
(Name and address of agent for service)
(804) 775-5700
(Telephone number, including area code, of agent for service)
CALCULATION OF REGISTRATION FEE (*)
Proposed Proposed
Maximum Maximum
Title of Each Class of Amount Offering Aggregate Amount of
Securities to be to be Price Offering Registration
Registered Registered Per Share Price Fee
Common Stock, without
par value . . . . . . 3,000,000 $34.375 $103,125,000 $31,250
shares
__________
(*) Computed in accordance with Rule 457 under the Securities Act of 1933, as
amended, solely for the purpose of calculating the registration fee and based
on the average of the high and low prices reported on the New York Stock
Exchange composite tape by The Wall Street Journal for April 16, 1997.<PAGE>
PART I
INFORMATION REQUIRED IN THE SECTION 10(a) PROSPECTUS
Item 1. Plan Information
Not required to be filed.
Item 2. Registrant Information and Employee Plan Annual Information.
Not required to be filed.
PART II
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
Item 3. Incorporation of Documents by Reference.
The following documents filed by Dominion Resources, Inc. (Dominion
Resources) with the Securities and Exchange Commission (the Commission) are
incorporated herein by reference and made a part hereof: (i) the Dominion
Resources' Annual Report on Form 10-K for the fiscal year ended December 31,
1996; and (ii) the description of the company's common stock (the Common Stock)
in the Dominion Resources registration statement on Form 8-B (item 4) dated
April 29, 1983, including any amendments and reports filed for the purpose of
updating such description.
In addition, all documents filed by Dominion Resources pursuant to Section
13(a), 13(c), 14 or 15(d) of the Securities Exchange Act of 1934, as amended
(the Exchange Act), prior to the filing of a post-effective amendment that
indicates that all securities offered hereby have been sold or that
deregisters all such securities then remaining unsold, shall be deemed to be
incorporated by reference into this registration statement and to be a part
hereof from the date of filing such documents.
Item 4. Description of Securities.
Not applicable.
Item 5. Interests of Named Experts and Counsel.
Not applicable.
Item 6. Indemnification of Directors and Officers.
Article VI of Dominion Resources' Articles of Incorporation mandates
indemnification of its directors and officers to the full extent permitted
by the Virginia Stock Corporation Act (the Virginia Act) and any other
applicable law. The Virginia Act permits a corporation to indemnify its
directors and officers against liability incurred in all proceedings,
including derivative proceedings, arising out of their service to the
corporation or to other corporations or enterprises that the officer or
director was serving at the request of the corporation, except in the case
of willful misconduct or a knowing violation of a criminal law. Dominion
Resources is required to indemnify its directors and officers in all such
proceedings if they have not violated this standard.
In addition, Article VI of Dominion Resources' Articles of Incorporation
limits the liability of its directors and officers to the full extent permitted
by the Virginia Act as now and hereafter in effect. The Virginia Act places a
limit on the liability of a director or officer in derivative or shareholder
proceedings equal to the lesser of (i) the amount specified in the corporation's
articles of incorporation or a shareholder-approved bylaw; or (ii) the greater
of (a) $100,000 or (b) twelve months of cash compensation received by the
director or officer. The limit does not apply in the event the director or
officer has engaged in willful misconduct or a knowing violation of a criminal
law or a federal or state securities law. The effect of Dominion Resources'
Articles of Incorporation, together with the Virginia Act, is to eliminate
liability of directors and officers for monetary damages in derivative or
shareholder proceedings so long as the required standard of conduct is met.
Dominion Resources has purchased directors' and officers' liability
insurance policies. Within the limits of their coverage, the policies insure
(1) the directors and officers of Dominion Resources against certain losses
resulting from claims against them in their capacities as directors and
officers to the extent that such losses are not indemnified by Dominion
Resources and (2) Dominion Resources to the extent that it indemnifies such
directors and officers for losses as permitted under the laws of Virginia.
Item 7. Exemption from Registration Claimed.
Not applicable.
Item 8. Exhibits:
4(i) -- Articles of Incorporation of Dominion Resources as in effect on
May 4, 1987 (Exhibit 3(i), Form 10-K for the fiscal year ended
December 31, 1993, File No. 1-8489, incorporated by reference).
4(ii)-- Bylaws of Dominion Resources as in effect on September 21, 1994
(Exhibit 3(ii), Form 10-K for the fiscal year ended December 31,
1994, File No. 1-8489, incorporated by reference).
5 -- Opinion of Thomas F. Farrell, II, Esq., Senior Vice President
and General Counsel of Dominion Resources, Inc. (filed
herewith).
23(i)-- Consent of Deloitte & Touche LLP (filed herewith).
23(ii)-- Consent of Thomas F. Farrell, II, Esq. (included in Exhibit 5).
24 -- Powers of Attorney (included herein).
99 -- Dominion Resources, Inc. Incentive Compensation Plan (filed
herewith).
<PAGE>
Item 9. Undertakings.
(a) The undersigned registrant hereby undertakes:
(1) 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 of 1933;
(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;
(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)(1)(i) and (a)(1)(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 section 15(d) of the Securities Exchange Act of 1934
that are incorporated by reference in the registration statement.
(2) That, for the purpose of determining any liability under the
Securities Act of 1933, 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.
(3) To remove from registration by means of a post-effective amendment
any of the securities being registered which remain unsold at the termination
of this offer.
(b) The undersigned registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act of 1933, each filing of the
registrant's annual report pursuant to Section 13(a) or 15(d) of the
Securities Exchange Act of 1934 (and, where applicable, each filing of an
employee benefit plan's annual report pursuant to Section 13(d) of the
Securities Exchange Act of 1934) 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.
(h) Insofar as indemnification for liabilities arising under the
Securities Act of 1933 may be permitted to directors, officers and controlling
persons of the registrant pursuant to the foregoing provisions, or otherwise,
the registrant has been advised that in the opinion of the Securities and
Exchange Commission such indemnification is against public policy as expressed
in the 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 Act
and will be governed by the final adjudication of such issue.
POWERS OF ATTORNEY
Each person whose signature appears below hereby authorizes either agent for
service named in the registration statement as attorney-in-fact, to sign on his
behalf individually and in each capacity stated below and file all amendments
and post effective amendments to the registration statement, and Dominion
Resources hereby confers like authority to sign and file on its behalf.
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the registrant
certifies that it has reasonable grounds to believe that it meets all of the
requirements for filing on Form S-8 and has duly caused this registration
statement to be signed on its behalf by the undersigned, thereunto duly
authorized, in the City of Richmond, Commonwealth of Virginia, on the 22nd day
of April, 1997.
DOMINION RESOURCES, INC.
By /s/THOS. E. CAPPS
(Thos. E. Capps, Chairman of the Board
of Directors, President and Chief
Executive Officer)
Pursuant to the requirements of the Securities Act of 1933, this
registration statement has been signed below by the following persons in the
capacities indicated and on the 22nd of April, 1997.
Signature Title
/s/JOHN B. ADAMS, JR.
John B. Adams, Jr. Director
/s/JOHN B. BERNHARDT
John B. Bernhardt Director
/s/THOS. E. CAPPS
Thos. E. Capps Chairman of the Board of Directors,
President (Chief Executive Officer)
and Director
/s/BENJAMIN J. LAMBERT, III
Benjamin J. Lambert, III Director
/s/RICHARD L. LEATHERWOOD
Richard L. Leatherwood Director
/s/HARVEY L. LINDSAY, JR.
Harvey L. Lindsay, Jr. Director
/s/K. A. RANDALL
K. A. Randall Director
/s/WILLIAM T. ROOS
William T. Roos Director
<PAGE>
Signature Title
/s/FRANK S. ROYAL
Frank S. Royal Director
/s/JUDITH B. SACK
Judith B. Sack Director
/s/S. DALLAS SIMMONS
S. Dallas Simmons Director
/s/ROBERT H. SPILMAN
Robert H. Spilman Director
/s/LINWOOD R. ROBERTSON
Linwood R. Robertson Executive Vice President (Chief
Financial Officer)
/s/J. L. TRUEHEART
J. L. Trueheart Vice President and Controller
(Principal Accounting Officer)
<PAGE>
EXHIBIT INDEX
Sequentially
Exhibit No. Exhibit Number Page
4(i) Articles of Incorporation as in effect May 4,
1987 (Exhibit 3(i), Form 10-K for the fiscal year
ended December 31, 1993, File No. 1-8489,
incorporated by reference).
4(ii) Bylaws of Dominion Resources, Inc. as in effect
September 21, 1994 (Exhibit 3(ii), Form 10-K for
the fiscal year ended December 31, 1994,
File No. 1-8489, incorporated by reference).
5 Opinion of Thomas F. Farrell, II, Esq., Senior
Vice President and General Counsel of Dominion
Resources, Inc. (filed herewith).
23(i) Consent of Deloitte & Touche LLP (filed herewith).
23(ii) Consent of Thomas F. Farrell, II, Esq., Senior
Vice President and General Counsel of Dominion
Resources, Inc. (contained in Exhibit 5).
24 Powers of attorney (included herein).
99 Dominion Resources, Inc. Incentive Compensation
Plan (filed herewith).
Exhibit 5
April 22, 1997
Dominion Resources, Inc.
P. O. Box 26532
Richmond, Virginia 23261
Ladies and Gentlemen:
With respect to the Registration Statement on Form S-8 of Dominion Resources,
Inc. (the Company) in connection with the registration of 3,000,000 shares of
common stock, without par value, (Common Stock) which have been reserved for
issuance pursuant to the Dominion Resources, Inc. Incentive Compensation Plan
(the Plan), I am of the opinion that the Common Stock when issued in accordance
with the terms and provisions of the Plan will be duly authorized, legally
issued, fully paid and nonassessable.
This opinion is limited to the laws of the Commonwealth of Virginia, and I
disclaim any opinion as to the laws of any other jurisdiction. I further
disclaim any opinion as to any statute, rule, regulation, ordinance, order or
other promulgation of any other jurisdiction or any regional or local
governmental body or as to any related judicial or administrative opinion. I
express no opinion as to the applicable choice of law provisions contained in
the Plan.
This opinion is rendered to you in connection with the issuance of the Common
Stock and is solely for your benefit. This opinion may not be relied upon by
any other person, firm, corporation or other entity for any purpose, without
prior written consent.
I hereby consent to the filing of this opinion as Exhibit 5 to the Registration
Statement.
Very truly yours,
/s/THOMAS F. FARRELL, II
Thomas F. Farrell, II, Esq.
Senior Vice President and General Counsel
Dominion Resources, Inc.
Exhibit 23(i)
CONSENT OF INDEPENDENT AUDITORS
We consent to the incorporation by reference in this Registration Statement of
Dominion Resources, Inc. on Form S-8 of our report dated February 11, 1997
incorporated by reference in the Annual Report on Form 10-K of Dominion
Resources, Inc. for the year ended December 31, 1996.
/s/Deloitte & Touche LLP
DELOITTE & TOUCHE LLP
Richmond, Virginia
April 22, 1997
Exhibit 99
DOMINION RESOURCES, INC.
INCENTIVE COMPENSATION PLAN
1. Purpose. The purpose of this Dominion Resources, Inc. Incentive
Compensation Plan is to further the long term stability and financial success of
Dominion Resources, Inc., Virginia Electric and Power Company, the Affiliates,
and the Dominion Companies by attracting and retaining employees through the use
of cash and stock incentives. It is believed that ownership of Company Stock and
the use of cash incentives will stimulate the efforts of those employees upon
whose judgment and interests the Employers are and will be largely dependent for
the successful conduct of its business. It is also believed that Incentive
Awards granted to such employees under this Plan will strengthen their desire to
remain employed with the Employers and will further the identification of those
employees' interests with those of the Dominion Resources, Inc. shareholders.
The Plan is intended to operate in compliance with the provisions of
Securities and Exchange Commission Rule 16b-3.
2. Definitions. As used in the Plan, the following terms have the meanings
indicated:
(a) ''Act'' means the Securities Exchange Act of 1934, as amended.
(b) ''Affiliate'' means another corporation in which Virginia Power owns
stock possessing at least 50 percent of the combined voting power of all classes
of stock.
(c) ''Applicable Withholding Taxes'' means the aggregate amount of federal,
state and local income and payroll taxes that an Employer is required to with-
holdin connection with any Performance Grant, any lapse of restrictions on
Restricted Stock, any grant of Goal-Based Stock, or any exercise of a
Nonstatutory Stock Option or Stock Appreciation Right.
(d) ''Change of Control'' means the occurrence of any of the following
events:
(i) any person, including a ''group'' as defined in Section 13(d)(3) of the
Act becomes the owner or beneficial owner of DRI securities having 20% or more
of the combined voting power of the then outstanding DRI securities that may be
cast for the election of DRI's directors (other than as a result of an issuance
of securities initiated by DRI, or open market purchases approved by the DRI
Board, as long as the majority of the DRI Board approving the purchases is also
the majority at the time the purchases are made);
(ii) as the direct or indirect result of, or in connection with, a cash
tender or exchange offer, a merger or other business combination, a sale of
assets, a contested election, or any combination of these transactions, the
persons who were directors of DRI before such transactions cease to constitute
<PAGE>
a majority of the DRI Board, or any successor's board, within two years of the
last of such transactions; or
(iii) with respect to a particular Participant, an event occurs with respect
to the Employer that employs that Participant such that, after the event, the
Employer is no longer a Dominion Company or an Affiliate.
(e) ''Code'' means the Internal Revenue Code of 1986, as amended.
(f) ''Company Stock'' means common stock of DRI. In the event of a change in
the capital structure of DRI (as provided in Section 15), the shares resulting
from such a change shall be deemed to be Company Stock within the meaning of the
Plan.
(g) ''Date of Grant'' means the date on which an Incentive Award is granted
by the DRI Committee or Virginia Power Committee.
(h) ''Disability'' or ''Disabled'' means, as to an Incentive Stock Option,
a Disability within the meaning of Code section 22(e)(3). As to all other
Incentive Awards, the DRI Committee for DRI Participants and the Virginia Power
Committee for Virginia Power Participants shall determine whether a Disability
exists and such determination shall be conclusive.
(i) ''Dominion Company'' means Dominion Capital, Inc., Dominion Energy, Inc.,
or another corporation (i) in which DRI owns stock possessing at least 50
percent of the combined voting power of all classes of stock or which is in a
chain of corporations with DRI in which stock possessing at least 50% of the
combined voting power of all classes of stock is owned by one or more other
corporations in the chain and (ii) which is not Virginia Power or an Affiliate.
(j) ''DRI'' means Dominion Resources, Inc.
(k) ''DRI Board'' means the Board of Directors of Dominion Resources, Inc.
(l) ''DRI Committee'' means the Organization and Compensation Committee of
the DRI Board, provided that, if any member of the Organization and Compensation
Committee does not qualify as both an outside director for purposes of Code
section 162(m) and a non-employee director for purposes of Rule 16b-3, the
remaining members of the committee (but not less than two members) shall be
constituted as a subcommittee of the Organization and Compensation Committee to
act as the DRI Committee for purposes of the Plan.
(m) ''DRI Participant'' means any employee of DRI or a Dominion Company who
receives an Incentive Award under the Plan.
(n) ''Employer'' means DRI, Virginia Power, and each Dominion Company or
Affiliate that employs one or more Participants.
(o) ''Fair Market Value'' means the closing trading price of a share of
Company Stock, as reported in The Wall Street Journal, as of the last day on
which Company Stock is traded preceding the Date of Grant or preceding any other
date for which the value of Company Stock must be determined under the Plan.
(p) ''Goal-Based Stock'' means Company Stock awarded when performance goals
are achieved pursuant to an award as provided in Section 8.
(q) ''Incentive Award'' means, collectively, a Performance Grant or the award
of Restricted Stock, Goal-Based Stock, an Option, or a Stock Appreciation Right
under the Plan.
(r) ''Incentive Stock Option'' means an Option intended to meet the
requirements of, and qualify for favorable federal income tax treatment under,
Code section 422.
(s) ''Mature Shares'' means shares of Company Stock for which the holder
thereof has good title, free and clear of all liens and encumbrances and which
such holder either (i) has held for at least six months or (ii) has purchased on
the open market.
(t) ''Nonstatutory Stock Option'' means an Option that does not meet the
requirements of Code section 422, or, even if meeting the requirements of Code
section 422, is not intended to be an Incentive Stock Option and is so
designated.
(u) ''Option'' means a right to purchase Company Stock granted under the
Plan, at a price determined in accordance with the Plan.
(v) ''Performance Criteria'' means any of the following areas of performance
of DRI, Virginia Power, any Dominion Company or any Affiliate: asset growth;
utility earnings; generating unit efficiency; combined net worth; debt to equity
ratio; earnings per share; revenues; operating income; operating cash flow; net
income, before or after taxes; return on total capital, equity, revenue or
assets; nonutility generation cost exposure; power generation costs; safety
measured in fatalities, lost time, injuries and vehicle accidents; environmental
protection measured in reportable violations, notices of violations, and
environmental agency required corrective actions or enforcement actions; or
economic value added (net operating profit after tax less a charge for use of
capital as determined under a methodology approved by the DRI Committee or
Virginia Power Committee).
(w) ''Performance Goal'' means an objectively determinable performance goal
established by the DRI Committee or Virginia Power Committee with respect to a
given Performance Grant or grant of Restricted Stock that relates to one or more
Performance Criteria.
(x) ''Performance Grant'' means an Incentive Award made pursuant to Section
6.
(y) ''Plan Year'' means January 1 to December 31.
(z) ''Restricted Stock'' means Company Stock awarded upon the terms and
subject to the restrictions set forth in Section 7.
(aa) ''Rule 16b-3'' means Rule 16b-3 of the Securities and Exchange
Commission promulgated under the Act. A reference in the Plan to Rule 16b-3
shall include a reference to any corresponding rule (or number redesignation)
of any amendments to Rule 16b-3 enacted after the effective date of the
Plan's adoption.
(bb) ''Stock Appreciation Right'' means a right to receive amounts from the
Employer granted under Section 10.
(cc) ''Taxable Year'' means the fiscal period used by DRI for reporting taxes
on income under the Code.
(dd) ''Virginia Power'' means Virginia Electric and Power Company.
(ee) ''Virginia Power Board'' means the Board of Directors of Virginia Power.
(ff) ''Virginia Power Committee'' means the Organization and Compensation
Committee of the Virginia Power Board, provided that, if any member of the
Organization and Compensation Committee does not qualify as both an outside
director for purposes of Code section 162(m) and a non-employee director for
purposes of Rule 16b-3, the remaining members of the committee (but not be less
than two members) shall be constituted as a subcommittee of the Organization and
Compensation Committee to act as the Virginia Power Committee for purposes of
the Plan.
(gg) ''Virginia Power Participant'' means any employee of Virginia Power or
an Affiliate who receives an Incentive Award under the Plan.
3. General. The following types of Incentive Awards may be granted under
the Plan: Performance Grants, Restricted Stock, Goal-Based Stock, Options, or
Stock Appreciation Rights. Options granted under the Plan may be Incentive Stock
Options or Nonstatutory Stock Options.
4. Stock. Subject to Section 15 of the Plan, there shall be reserved for
issuance under the Plan an aggregate of three million (3,000,000) shares of
Company Stock, which shall be authorized, but unissued shares. Shares allocable
to Options, Restricted Stock or portions thereof granted under the Plan that
expire, are forfeited, or otherwise terminate unexercised may again be subjected
to an Incentive Award under the Plan. The DRI Committee or Virginia Power
Committee is expressly authorized to make an Incentive Award to a Participant
conditioned upon the surrender for cancellation of an option granted under an
existing Incentive Award. However, without prior shareholder approval, the
Committees are expressly prohibited from making a new Incentive Award in the
form of an Option if the exercise price of the new Option is less than the
exercise price of the Option under the existing Incentive Award surrendered
for cancellation. No more than two hundred thousand (200,000) shares may be
allocated to the Incentive Awards, including the maximum amounts payable under
a Performance Grant, that are granted to any individual Participant during any
single Taxable Year.
5. Eligibility.
(a) All present and future employees of DRI or a Dominion Company (whether
now existing or hereafter created or acquired) whom the DRI Committee determines
to have contributed or who can be expected to contribute significantly to DRI or
a Dominion Company shall be eligible to receive Incentive Awards under the Plan.
All present and future employees of Virginia Power or an Affiliate (whether now
existing or hereafter created or acquired) whom the Virginia Power Committee
determines to have contributed or who can be expected to contribute signifi-
cantly to Virginia Power or an Affiliate shall be eligible to receive
Incentive Awards under the Plan. The Committees shall have the power and
complete discretion, as provided in Section 16, to select eligible employees
to receive Incentive Awards and to determine for each employee the nature of
the award and the terms and conditions of each Incentive Award.
(b) The grant of an Incentive Award shall not obligate an Employer to pay an
employee any particular amount of remuneration, to continue the employment of
the employee after the grant or to make further grants to the employee at any
time thereafter.
6. Performance Grants.
(a) Each Performance Grant shall be evidenced by an agreement (a ''Grant
Agreement'') setting forth the Performance Goals for the award, including the
Performance Criteria, the target and maximum amounts payable and such other
terms and conditions as are applicable to the Performance Grant. Each
Performance Grant shall be granted and administered to comply with the
requirements of Code section 162(m). The aggregate maximum cash amount
payable under the Plan to any Participant in any Plan Year shall not exceed
0.5% of DRI's consolidated operating income, before taxes and interest, as
reported on its annual financial statements for the prior Plan Year. In the
event of any conflict between a Grant Agreement and the Plan, the terms of
the Plan shall govern.
(b) The DRI Committee shall establish the Performance Goals for Performance
Grants to DRI Participants. The Virginia Power Committee shall establish the
Performance Goals for Performance Grants to Virginia Power Participants. The
appropriate Committee shall determine the extent to which any Performance
Criteria shall be used and weighted in determining Performance Grants. The
Committee may vary the Performance Criteria, Performance Goals and weightings
from Participant to Participant, Performance Grant to Performance Grant and Plan
Year to Plan Year. The Committee may increase, but not decrease, any Performance
Goal during a Plan Year.
(c) The appropriate Committee shall establish for each Performance Grant the
amount of cash or Company Stock payable at specified levels of performance,
based on the Performance Goal for each Performance Criteria. Any Performance
Grant shall be made not later than 90 days after the start of the period for
which the Performance Grant relates and shall be made prior to the completion
of 25% of such period. All determinations regarding the achievement of any
Performance Goals will be made by the appropriate Committee. A Committee may
not increase during a Plan Year the amount of cash or Common Stock that would
otherwise be payable upon achievement of the Performance Goal or Goals but
may reduce or eliminate the payments as provided in a Performance Grant.
(d) The actual payments to a Participant under a Performance Grant will be
calculated by applying the achievement of a Performance Criteria to the
Performance Goal as established in the Grant Agreement. All calculations of
actual payments shall be made by the appropriate Committee and the DRI Committee
shall certify in writing the extent, if any, to which the Performance Goals have
been met.
(e) Performance Grants will be paid in cash, Company Stock or both, at such
time or times as are provided in the Grant Agreement. The appropriate Committee
may provide in the Grant Agreement that the Participant may make a prior
election to defer the payment under a Performance Grant subject to such terms
and conditions as the Committee may determine.
(f) Nothing contained in the Plan will be deemed in any way to limit or
restrict any Employer or either Committee from making any award or payment to
any person under any other plan, arrangement or understanding, whether now
existing or hereafter in effect.
(g) A Participant who receives a Performance Grant payable in Company Stock
shall have no rights as a shareholder until the Company Stock is issued pursuant
to the terms of the Performance Grant. The Company Stock may be issued without
cash consideration.
(h) A Participant's interest in a Performance Grant may not be sold,
assigned, transferred, pledged, hypothecated, or otherwise encumbered.
(i) Whenever payments under a Performance Grant are to be made in cash, the
Employer will withhold therefrom an amount sufficient to satisfy any Applicable
Withholding Taxes. Each Participant shall agree as a condition of receiving a
Performance Grant payable in the form of Company Stock, to pay to the Employer,
or make arrangements satisfactory to the Employer regarding the payment to the
Employer of, Applicable Withholding Taxes. Until such amount has been paid or
arrangements satisfactory to the Employer have been made, no stock certificate
shall be issued to such Participant. As an alternative to making a cash payment
to the Employer to satisfy Applicable Withholding Taxes, if the Grant Agreement
so provides, the Participant may elect to (i) to deliver Mature Shares (valued
at their Fair Market Value) or (ii) to have the Employer retain that number of
shares of Company Stock (valued at their Fair Market Value) that would satisfy
all or a specified portion of the Applicable Withholding Taxes.
7. Restricted Stock Awards.
(a) The DRI Committee may make grants of Restricted Stock to DRI
Participants. The Virginia Power Committee may make grants of Restricted Stock
to Virginia Power Participants. Whenever a Committee deems it appropriate to
grant Restricted Stock, notice shall be given to the Participant stating the
number of shares of Restricted Stock granted and the terms and conditions to
which the Restricted Stock is subject. This notice, when accepted in writing by
the Participant shall become an Grant Agreement between the Employer and the
Participant. Restricted Stock may be awarded by a Committee in its discretion
without cash consideration.
(b) No shares of Restricted Stock may be sold, assigned, transferred,
pledged, hypothecated, or otherwise encumbered or disposed of until the
<PAGE>
restrictions on such shares as set forth in the Participant's Grant Agreement
have lapsed or been removed pursuant to paragraph (d) or (e) below.
(c) Upon the acceptance by a Participant of an award of Restricted Stock,
such Participant shall, subject to the restrictions set forth in paragraph (b)
above, have all the rights of a shareholder with respect to such shares of
Restricted Stock, including, but not limited to, the right to vote such shares
of Restricted Stock and the right to receive all dividends and other
distributions paid thereon. Certificates representing Restricted Stock shall be
held by DRI until the restrictions lapse and the Participant shall provide DRI
with appropriate stock powers endorsed in blank.
(d) The appropriate Committee shall establish as to each award of Restricted
Stock the terms and conditions upon which the restrictions set forth in
paragraph (b) above shall lapse. The terms and conditions may include the
achievement of a Performance Goal which shall be governed by the provisions
of Section 6 to the extent that the award is intended to comply with the
requirements of Code section 162(m). Such terms and conditions may also
include, without limitation, the lapsing of such restrictions as a result of
the Disability, death or retirement of the Participant or the occurrence of a
Change of Control.
(e) Notwithstanding the provisions of paragraph (b) above, the appropriate
Committee may at any time, in its sole discretion, accelerate the time at which
any or all restrictions will lapse or remove any and all such restrictions,
subject to the restrictions of Section 6 as to any Performance Goal if the award
is intended to comply with the requirements of Code section 162(m).
(f) Each Participant shall agree at the time his or her Restricted Stock is
granted, and as a condition thereof, to pay to the Employer, or make arrange-
ments satisfactory to the Employer regarding the payment to the Employer of,
Applicable Withholding Taxes. Until such amount has been paid or arrangements
satisfactory to the Employer have been made, no stock certificate free of a
legend reflecting the restrictions set forth in paragraph (b) above shall be
issued to such Participant. As an alternative to making a cash payment to the
Employer to satisfy Applicable Withholding Taxes, if the grant so provides,
the Participant may elect to (i) to deliver Mature Shares (valued at their
Fair Market Value) or (ii) to have the Employer retain that number of shares
of Company Stock (valued at their Fair Market Value) that would satisfy all
or a specified portion of the Applicable Withholding Taxes.
8. Goal-Based Stock Awards.
(a) The DRI Committee may make grants of Goal-Based Stock to DRI
Participants. The Virginia Power Committee may make grants of Goal-Based Stock
to Virginia Power Participants. Whenever a Committee deems it appropriate to
grant Goal-Based Stock, notice shall be given to the Participant stating the
number of shares of Goal-Based Stock granted and the terms and conditions to
which the Goal-Based Stock is subject. This notice, when accepted in writing by
the Participant shall become a grant agreement between the Employer and the
Participant.
<PAGE>
(b) Goal-Based Stock may be issued pursuant to the Plan from time to time by
a Committee when performance criteria established by the Committee have been
achieved and certified by the Committee.
(c) Whenever a Committee deems it appropriate, the Committee may establish
a performance criteria for an award of Goal-Based Stock and notify Participants
of their receipt of an award of Goal-Based Stock. More than one award of
Goal-Based Stock may be established by the Committee for a Participant and the
awards may operate concurrently or for varied periods of time. Goal-Based
Stock will be issued only subject to the award and the Plan and consistent
with meeting the goal or goals set by the Committee in the award. A Partici-
pant shall have no rights as a shareholder until the Committee has certified
that the performance objectives of the Goal-Based Stock award have been met
and the Goal-Based Stock is issued. Goal-Based Stock may be issued without
cash consideration.
(d) A Participant's interest in a Goal-Based Stock award may not be sold,
assigned, transferred, pledged, hypothecated, or otherwise encumbered.
(e) The appropriate Committee may at any time, in its sole discretion, remove
or revise any and all performance criteria for an award of Goal-Based Stock.
(f) Each Participant shall agree at the time of receiving an award of Goal-
Based Stock, and as a condition thereof, to pay to the Employer, or make
arrangements satisfactory to the Employer regarding the payment to the Employer
of, Applicable Withholding Taxes. Until such amount has been paid or arrange-
ments satisfactory to the Employer have been made, no stock certificate shall
be issued to such Participant. As an alternative to making a cash payment to
the Employer to satisfy Applicable Withholding Taxes, if the grant so
provides, the Participant may elect to (i) to deliver Mature Shares (valued
at their Fair Market Value) or (ii) to have the Employer retain that number
of shares of Company Stock (valued at their Fair Market Value) that would
satisfy all or a specified portion of the Applicable Withholding Taxes.
9. Stock Options.
(a) The DRI Committee may make grants of Options to DRI Participants. The
Virginia Power Committee may make grants of Options to Virginia Power
Participants. Whenever a Committee deems it appropriate to grant Options, notice
shall be given to the Participant stating the number of shares for which Options
are granted, the Option price per share, whether the Options are Incentive Stock
Options or Nonstatutory Stock Options, the extent to which Stock Appreciation
Rights are granted (as provided in Section 10), and the conditions to which the
grant and exercise of the Options are subject. This notice, when duly accepted
in writing by the Participant, shall become a stock option agreement.
(b) The exercise price of shares of Company Stock covered by an Option shall
be not less than 100% of the Fair Market Value of such shares on the Date of
Grant.
(c) Options may be exercised in whole or in part at such times as may be
specified by the Committee in the Participant's stock option agreement;
provided that, the exercise provisions for Incentive Stock Options shall in
all events not be more liberal than the following provisions:
(i) No Incentive Stock Option may be exercised after the first to occur of
(x) ten years from the Date of Grant, (y) three months following the date of the
Participant's retirement or termination of employment with all Employers for
reasons other than Disability or death, or (z) one year following the date of
the Participant's termination of employment on account of Disability or death.
(ii) An Incentive Stock Option by its terms, shall be exercisable in any
calendar year only to the extent that the aggregate Fair Market Value
(determined at the Date of Grant) of the Company Stock with respect to which
Incentive Stock Options are exercisable for the first time during the
calendar year does not exceed $100,000 (the ''Limitation Amount''). Incentive
Stock Options granted under the Plan and all other plans of any Employer
shall be aggregated for purposes of determining whether the Limitation Amount
has been exceeded. The Committee granting the Option may impose such
conditions as it deems appropriate on an Incentive Stock Option to ensure
that the foregoing requirement is met. If Incentive Stock Options that first
become exercisable in a calendar year exceed the Limitation Amount, the
excess Options will be treated as Nonstatutory Stock Options to the extent
permitted by law.
10. Stock Appreciation Rights.
(a) Whenever the DRI Committee deems it appropriate, Stock Appreciation
Rights may be granted in connection with all or any part of an Option to a DRI
Participant or in a separate Incentive Award. Whenever the Virginia Power
Committee deems it appropriate, Stock Appreciation Rights may be granted in
connection with all or any part of an Option to a Virginia Power Participant or
in a separate Incentive Award.
(b) The following provisions apply to all Stock Appreciation Rights that are
granted in connection with Options:
(i) Stock Appreciation Rights shall entitle the Participant, upon exercise
of all or any part of the Stock Appreciation Rights, to surrender to the
Employer unexercised that portion of the underlying Option relating to the
same number of shares of Company Stock as is covered by the Stock
Appreciation Rights (or the portion of the Stock Appreciation Rights so
exercised) and to receive in exchange from the Employer an amount equal to
the excess of (x) the Fair Market Value on the date of exercise of the
Company Stock covered by the surrendered portion of the underlying Option
over (y) the exercise price of the Company Stock covered by the surrendered
portion of the underlying Option. The appropriate Committee may limit the
amount that the Participant will be entitled to receive upon exercise of
Stock Appreciation Rights.
(ii) Upon the exercise of a Stock Appreciation Right and surrender of the
related portion of the underlying Option, the Option, to the extent surrendered,
shall not thereafter be exercisable.
(iii) Subject to any further conditions upon exercise imposed by the Board,
a Stock Appreciation Right shall be exercisable only to the extent that the
related Option is exercisable and a Stock Appreciation Right shall expire no
later than the date on which the related Option expires.
(iv) A Stock Appreciation Right may only be exercised at a time when the Fair
Market Value of the Company Stock covered by the Stock Appreciation Right
exceeds the exercise price of the Company Stock covered by the underlying
Option.
(c) The following provisions apply to all Stock Appreciation Rights that are
not granted in connection with Options:
(i) Stock Appreciation Rights shall entitle the Participant, upon exercise
of all or any part of the Stock Appreciation Rights, to receive in exchange from
the Employer an amount equal to the excess of (x) the Fair Market Value on the
date of exercise of the Company Stock covered by the surrendered Stock
Appreciation Right over (y) the price of the Company Stock on the Date of Grant
of the Stock Appreciation Right. The appropriate Committee may limit the amount
that the Participant will be entitled to receive upon exercise of Stock
Appreciation Rights.
(ii) A Stock Appreciation Right may only be exercised at a time when the Fair
Market Value of the Company Stock covered by the Stock Appreciation Right
exceeds the Fair Market Value of the Company Stock on the Date of Grant of
the Stock Appreciation Right.
(d) The manner in which the Employer's obligation arising upon the exercise
of a Stock Appreciation Right shall be paid shall be determined by the
appropriate Committee and shall be set forth in the Incentive Award. The
Incentive Award may provide for payment in Company Stock or cash, or a fixed
combination of Company Stock or cash, or the appropriate Committee may reserve
the right to determine the manner of payment at the time the Stock Appreciation
Right is exercised. Shares of Company Stock issued upon the exercise of a Stock
Appreciation Right shall be valued at their Fair Market Value on the date of
exercise.
11. Method of Exercise of Options and Stock Appreciation Rights.
(a) Options and Stock Appreciation Rights may be exercised by the Participant
giving written notice of the exercise to the Employer, stating the number of
shares the Participant has elected to purchase under the Option or the number of
Stock Appreciation Rights the Participant has elected to exercise. In the case
of the purchase of shares under an Option, such notice shall be effective only
if accompanied by the exercise price in full in cash; provided, however, that if
the terms of an Option so permit, the Participant may (i) deliver Mature Shares
(valued at their Fair Market Value) in satisfaction of all or any part of the
exercise price, (ii) cause to be withheld from the Option shares, shares of
Company Stock (valued at their Fair Market Value) in satisfaction of all or any
part of the exercise price, or (iii) deliver a properly executed exercise notice
together with irrevocable instructions to a broker to deliver promptly to the
Employer, from the sale or loan proceeds with respect to the sale of Company
Stock or a loan secured by Company Stock, the amount necessary to pay the
exercise price and, if required by the terms of the Option, Applicable
Withholding Taxes.
(b) DRI may place on any certificate representing Company Stock issued upon
the exercise of an Option or a Stock Appreciation Right any legend deemed
desirable by the DRI's counsel to comply with federal or state securities laws,
and DRI may require a customary written indication of the Participant's
investment intent. Until the Participant has made any required payment,
including any Applicable Withholding Taxes, and has had issued a certificate
for the shares of Company Stock acquired, he or she shall possess no share-
holder rights with respect to the shares.
(c) Each Participant shall agree as a condition of the exercise of an Option
or a Stock Appreciation Right, to pay to the Employer, or make arrangements
satisfactory to the Employer regarding the payment to the Employer of,
Applicable Withholding Taxes. Until such amount has been paid or arrangements
satisfactory to the Employer have been made, no stock certificate shall be
issued upon the exercise of an Option or cash paid upon the exercise of a
Stock Appreciation Right.
(d) As an alternative to making a cash payment to the Employer to satisfy
Applicable Withholding Taxes, if the Option or Stock Appreciation Rights
agreement so provides, the Participant may elect to (i) to deliver Mature Shares
(valued at their Fair Market Value) or (ii) to have the Employer retain that
number of shares of Company Stock (valued at their Fair Market Value) that would
satisfy all or a specified portion of the Applicable Withholding Taxes.
12. Transferability of Options and Stock Appreciation Rights. Nonstatutory
Stock Options and Stock Appreciation Rights may be transferable by a Participant
and exercisable by a person other than the Participant, but only to the extent
specifically provided in the Incentive Award. Incentive Stock Options, by their
terms, shall not be transferable except by will or by the laws of descent and
distribution and shall be exercisable, during the Participant's lifetime, only
by the Participant.
13. Effective Date of the Plan. The effective date of the Plan is January
1, 1997. The Plan shall be submitted to the shareholders of the DRI for
approval. Until (i) the Plan has been approved by DRI's shareholders, and
(ii) the requirements of any applicable Federal or State securities laws have
been met, no Restricted Stock or Goal-Based Stock shall be awarded that is
not contingent on these events and no Option or Stock Appreciation Right
granted shall be exercisable.
14. Termination, Modification, Change. If not sooner terminated by the DRI
Board, this Plan shall terminate at the close of business on December 31, 2006.
No Incentive Awards shall be made under the Plan after its termination. The DRI
Board may amend or terminate the Plan with respect to DRI Participants in such
respects as it shall deem advisable and the Virginia Power Board may amend or
terminate the Plan with respect to Virginia Power Participants in such respects
as it shall deem advisable; provided that, if and to the extent required by the
Code, no change shall be made that increases the total number of shares of
Company Stock reserved for issuance pursuant to Incentive Awards granted under
the Plan (except pursuant to Section 15), materially modifies the requirements
as to eligibility for participation in the Plan, or materially increases the
benefits accruing to Participants under the Plan, unless such change is
authorized by the shareholders of DRI. Notwithstanding the foregoing, the DRI
Board may unilaterally amend the Plan and Incentive Awards with respect to DRI
Participants as it deems appropriate to ensure compliance with Rule 16b-3 and to
cause Incentive Stock Options to meet the requirements of the Code and
regulations thereunder. Notwithstanding the foregoing, the Virginia Power Board
may unilaterally amend the Plan and Incentive Awards with respect to Virginia
Power Participants as it deems appropriate to ensure compliance with Rule 16b-3
and to cause Incentive Stock Options to meet the requirements of the Code and
regulations thereunder. Except as provided in the preceding two sentences, a
termination or amendment of the Plan shall not, without the consent of the
Participant, adversely affect a Participant's rights under an Incentive Award
previously granted to him or her.
15. Change in Capital Structure.
(a) In the event of a stock dividend, stock split or combination of shares,
recapitalization or merger in which DRI is the surviving corporation or other
change in DRI's capital stock (including, but not limited to, the creation or
issuance to shareholders generally of rights, options or warrants for the
purchase of common stock or preferred stock of DRI), the number and kind of
shares of stock or securities of DRI to be subject to the Plan and to Options
then outstanding or to be granted thereunder, the maximum number of shares or
securities which may be delivered under the Plan, the maximum number of shares
or securities that can be granted to an individual Participant under Section 4,
the exercise price, the terms of Incentive Awards and other relevant provisions
shall be appropriately adjusted by either the Virginia Power Committee with
respect to Virginia Power Participants or by the DRI Committee with respect to
DRI Participants, whose determination shall be binding on all persons. If the
adjustment would produce fractional shares with respect to any unexercised
Option, either the Virginia Power Committee with respect to Virginia Power
Participants or the DRI Committee with respect to DRI Participants may adjust
appropriately the number of shares covered by the Option so as to eliminate the
fractional shares.
(b) If DRI is a party to a consolidation or a merger in which DRI is not the
surviving corporation, a transaction that results in the acquisition of
substantially all of DRI's outstanding stock by a single person or entity, or a
sale or transfer of substantially all of DRI's assets, the DRI Committee may
take such actions with respect to outstanding Incentive Awards as the DRI
Committee deems appropriate.
(c) Notwithstanding anything in the Plan to the contrary, either the Virginia
Power Committee or the DRI Committee may take the foregoing actions without the
consent of any Participant, and either the Virginia Power Committee or the DRI
Committee's determination shall be conclusive and binding on all persons for all
purposes.
16. Administration of the Plan.
(a) Subject to the provisions of Section 16(b), the Plan shall be
administered by the DRI Committee as to DRI Participants and by the Virginia
Power Committee as to Virginia Power Participants. Any reference in the Plan to
a Committee shall be deemed to refer to the DRI Committee with respect to DRI
Participants and to the Virginia Power Committee with respect to Virginia Power
Participants. The Committees shall have general authority to impose any
limitation or condition upon an Incentive Award the Committees deem appropriate
to achieve the objectives of the Incentive Award and the Plan and, without
limitation and in addition to powers set forth elsewhere in the Plan, shall have
the power and complete discretion to determine:
(i) which eligible employees shall receive Incentive Awards and the nature
of each Incentive Award, (ii) the terms and conditions of any Performance Grant,
(iii) whether all or any part of an Incentive Award shall be accelerated upon a
Change of Control, (iv) the number of shares of Company Stock to be covered by
each Incentive Award, (v) whether Options shall be Incentive Stock Options or
Nonstatutory Stock Options, (vi) when, whether and to what extent Stock
Appreciation Rights shall be granted, (vii) the time or times when an Incentive
Award shall be granted, (viii) whether an Incentive Award shall become vested
over a period of time and when it shall be fully vested, (ix) when Options and
Stock Appreciation Rights may be exercised, (x) whether a Disability exists,
(xi) the manner in which payment will be made upon the exercise of Options or
Stock Appreciation Rights, (xii) conditions relating to the length of time
before disposition of Company Stock received upon the exercise of Options or
Stock Appreciation Rights is permitted, (xiii) whether to authorize a Partici-
pant (A) to deliver Mature Shares to satisfy Applicable Withholding Taxes or
(B) to have the Employer withhold from the shares to be issued upon the
exercise of a Nonstatutory Stock Option or Stock Appreciation Right the
number of shares necessary to satisfy Applicable Withholding Taxes, (xiv) the
terms and conditions applicable to Restricted Stock awards, (xv) the terms
and conditions on which restrictions upon Restricted Stock shall lapse, (xvi)
whether to accelerate the time at which any or all restrictions with respect
to Restricted Stock will lapse or be removed, (xvii) the terms and conditions
applicable to Goal-Based Stock awards, (xviii) notice provisions relating to
the sale of Company Stock acquired under the Plan, (xix) the extent to which
information shall be provided to Participants about available tax elections,
and (xx) any additional requirements relating to Incentive Awards that the
Committee deems appropriate. Notwithstanding the foregoing, no ''tandem stock
options'' (where two stock options are issued together and the exercise of
one option affects the right to exercise the other option) may be issued in
connection with Incentive Stock Options. Each Committee shall have the power
to amend the terms of previously granted Incentive Awards that were granted
by that Committee so long as the terms as amended are consistent with the
terms of the Plan and provided that the consent of the Participant is
obtained with respect to any amendment that would be detrimental to him or
her, except that such consent will not be required if such amendment is for
the purpose of complying with Rule 16b-3 or any requirement of the Code
applicable to the Incentive Award.
(b) Not withstanding anything in the Plan to the contrary, all grants of
Incentive Awards and the terms and conditions of such Incentive Awards, and any
adjustments due to a change in capital structure as set forth in Section 15 by
the Virginia Power Committee shall be subject to the review and approval of the
DRI Committee and no such Incentive Awards shall become effective without the
approval of the DRI Committee. All grants of Incentive Awards made or
approved <PAGE>
by the DRI Committee shall be submitted to the DRI Board for such
consideration as the DRI Board deems appropriate.
(c) The DRI Committee may adopt rules and regulations for carrying out the
Plan with respect to DRI Participants. The interpretation and construction of
any provision of the Plan by the DRI Committee shall be final and conclusive
as to any DRI Participant. The Virginia Power Committee may adopt rules and
regulations for carrying out the Plan with respect to Virginia Power
Participants. The interpretation and construction of any provision of the
Plan by the Virginia Power Committee shall be final and conclusive as to any
Virginia Power Participant. A Committee may consult with counsel, who may be
counsel to the Employer, and shall not incur any liability for any action
taken in good faith in reliance upon the advice of counsel.
(d) A majority of the members of a Committee shall constitute a quorum, and
all actions of a Committee shall be taken by a majority of the members present.
Any action may be taken by a written instrument signed by all of the members,
and any action so taken shall be fully effective as if it had been taken at a
meeting.
17. Notice. All notices and other communications required or permitted to
be given under this Plan shall be in writing and shall be deemed to have been
duly given if delivered personally or mailed first class, postage prepaid, as
follows (a) if to DRI at the principal business address of DRI to the attention
of the Corporate Secretary of DRI; (b) if to Virginia Power at the principal
business address of Virginia Power to the attention of the Corporate Secretary
of Virginia Power; and if to any Participant at the last address of the
Participant known to the sender at the time the notice or other communication is
sent.
18. Interpretation. The terms of this Plan are subject to all present and
future regulations and rulings of the Secretary of the Treasury of the United
States or his or her delegate relating to the qualification of Incentive Stock
Options under the Code. If any provision of the Plan conflicts with any such
regulation or ruling, then that provision of the Plan shall be void and of no
effect. The terms of this Plan shall be governed by the laws of the Commonwealth
of Virginia.
