<PAGE>
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of
the Securities Exchange Act of 1934 (Amendment No. )
Filed by the Registrant /X/
Filed by a Party other than the Registrant / /
Check the appropriate box:
/ / Preliminary Proxy Statement
/ / Confidential, for Use of the Commission Only (as permitted by Rule
14a-6(e)(2))
/X/ Definitive Proxy Statement
/ / Definitive Additional Materials
/ / Soliciting Material Pursuant to Section240.14a-11(c) or
Section240.14a-12
DOMINION RESOURCES, INC.
- --------------------------------------------------------------------------------
(Name of Registrant as Specified In Its Charter)
PATRICIA A. WILKERSON
- --------------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
/ / No fee required.
/ / Fee computed on table below per Exchange Act Rules 14a-6(i)(1)
and 0-11.
(1) Title of each class of securities to which transaction applies:
-----------------------------------------------------------------------
(2) Aggregate number of securities to which transaction applies:
-----------------------------------------------------------------------
(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (set forth the amount on which the
filing fee is calculated and state how it was determined):
-----------------------------------------------------------------------
(4) Proposed maximum aggregate value of transaction:
-----------------------------------------------------------------------
(5) Total fee paid:
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/ / Fee paid previously with preliminary materials.
/ / Check box if any part of the fee is offset as provided by Exchange Act Rule
0-11(a)(2) and identify the filing for which the offsetting fee was paid
previously. Identify the previous filing by registration statement number,
or the Form or Schedule and the date of its filing.
(1) Amount Previously Paid:
-----------------------------------------------------------------------
(2) Form, Schedule or Registration Statement No.:
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(3) Filing Party:
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(4) Date Filed:
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<PAGE>
DOMINION RESOURCES, INC.
[LOGO]
901 EAST BYRD STREET
RICHMOND, VIRGINIA 23219
March 11, 1998
DEAR SHAREHOLDER:
You are invited to attend our 1998 Annual Meeting of Shareholders. It will be
held
in the Charlottesville Performing Arts Center (at Charlottesville High School),
1400 Melbourne Road, Charlottesville, Virginia, on Friday, April 17, 1998, at
9:30 a.m., Eastern Daylight Time.
This year's meeting will be held in Charlottesville to allow our shareholders
who
live in the western part of Virginia to attend more easily. As in past years,
this is also
my opportunity to update you personally on our business activities, our
operating
results and our strategy. You will be able to ask me questions about our
operations
and plans.
I hope you will be able to attend the meeting. Even if you are not able to
attend, please complete and sign your proxy card and mail it in the enclosed
envelope promptly.
Sincerely,
[SIGNATURE]
THOS. E. CAPPS
Chairman of the Board, President
and Chief Executive Officer
<PAGE>
1998 PROXY STATEMENT
TABLE OF CONTENTS
<TABLE>
<S> <C>
ANNUAL MEETING NOTICE.............................................................. 3
THE PROXY PROCESS.................................................................. 4
Record Date.................................................................... 4
Voting Procedures and Rights................................................... 4
Solicitation and Tabulation.................................................... 5
THE BOARD.......................................................................... 6
1998 Election of Directors (Item 1)............................................ 6
Incumbent Directors............................................................ 7
Meeting Attendance............................................................. 8
Committees..................................................................... 9
Compensation and Other Programs................................................ 10
Director Nominations........................................................... 11
SHARE OWNERSHIP TABLE.............................................................. 12
ORGANIZATION AND COMPENSATION COMMITTEE REPORT..................................... 13
Compensation Philosophy........................................................ 13
1997 Compensation.............................................................. 13
Deductibility of Compensation.................................................. 17
Compensation Committee Interlocks and Insider Participation.................... 17
EXECUTIVE COMPENSATION............................................................. 18
Summary Compensation Table..................................................... 18
Long-Term Incentive Plans--Awards in Last Fiscal Year.......................... 20
Aggregated Options/SAR Exercises in Last Fiscal Year........................... 21
Performance Graph.............................................................. 22
Retirement Plans............................................................... 22
Other Executive Agreements and Arrangements.................................... 24
DESIGNATION OF AUDITORS (ITEM 2)................................................... 26
OTHER INFORMATION.................................................................. 27
Matters Before the 1998 Annual Meeting......................................... 27
Proposals for the 1999 Annual Meeting.......................................... 27
1997 Form 10-K................................................................. 27
</TABLE>
2
<PAGE>
DOMINION RESOURCES, INC.
[LOGO]
901 EAST BYRD STREET
RICHMOND, VIRGINIA 23219
March 11, 1998
NOTICE OF 1998 ANNUAL MEETING OF SHAREHOLDERS
The Annual Meeting of Shareholders of Dominion Resources, Inc. will be held in
the Performing Arts Center (at Charlottesville High School), 1400 Melbourne
Road, Charlottesville, Virginia on Friday, April 17, 1998, at 9:30 a.m., Eastern
Daylight
Time, for the following purposes:
1. To elect four directors;
2. To ratify the designation by the Board of Directors of Deloitte & Touche
LLP
as your company's independent auditors for 1998;
and to act on such other matters that properly come before the meeting.
Only shareholders of record at the close of business on February 20, 1998 will
be entitled to vote at the meeting, in person or by proxy.
By Order of the Board of Directors,
[SIGNATURE]
Patricia A. Wilkerson
CORPORATE SECRETARY
3
<PAGE>
THE PROXY PROCESS
RECORD DATE
The Board of Directors is soliciting this proxy for the 1998 Annual Meeting of
Shareholders. This proxy statement and enclosed proxy card were mailed on or
about March 11, 1998, to all shareholders of record as of February 20, 1998.
There
were 194,804,512 shares of Dominion Resources, Inc. (Dominion Resources) common
stock outstanding on February 20, 1998.
VOTING PROCEDURES AND RIGHTS
Each of your shares will be counted as one vote. If you vote and change your
mind on any issue, you may revoke your proxy at any time before the close of
voting at the Annual Meeting. You can do this by delivering another proxy or a
written notice of your revocation to our Corporate Secretary.
A majority of the shares outstanding on February 20, 1998 constitute a quorum
for this meeting. Abstentions and shares held by a broker or nominee (Broker
Shares) that are voted on any matter are included in determining a quorum.
The four nominees for director receiving the most votes will be elected.
REGISTERED SHAREHOLDERS AND DOMINION DIRECT INVESTMENT-REGISTERED TRADEMARK-
PARTICIPANTS. Your proxy card shows the number of full and fractional shares you
own. If you are a participant in our Dominion Direct Investment stock purchase
plan, the number includes shares we hold in your Dominion Direct Investment
account. All shares will be voted according to your instructions if you properly
sign and return your proxy. If you do not make a selection, your proxy will be
voted as recommended by the Board of Directors. IF YOU ARE A DOMINION DIRECT
INVESTMENT PARTICIPANT AND DO NOT RETURN YOUR PROXY, WE WILL VOTE ALL SHARES
HELD IN THAT ACCOUNT ACCORDING TO THE BOARD'S RECOMMENDATIONS.
EMPLOYEE SAVINGS PLAN PARTICIPANTS. You will receive a request for Voting
Instructions from Mellon Bank, N.A., the Savings Plan trustee. The share amounts
listed on that form include the full and fractional shares in your Savings Plan
account. That form should be properly signed and returned in the enclosed
envelope (NOT TO DOMINION RESOURCES). Mellon Bank will vote according to your
instructions and will keep your vote confidential. If you do not vote your
Savings Plan shares, Mellon Bank generally will vote your shares according to
the Board's recommendations.
4
<PAGE>
SOLICITATION AND TABULATION
We will pay for soliciting proxies from our shareholders, and some of our
employees may telephone shareholders after the initial mail solicitation. In
addition, we may reimburse brokerage firms and other custodians, nominees and
fiduciaries for their reasonable expenses in sending proxy materials to the
beneficial owners of stock. We have retained Corporate Election Services, Inc.
to tabulate the proxies and to assist with the Annual Meeting. We have also
retained Georgeson & Co., Inc., a proxy solicitation firm, to assist in the
solicitation of proxies for a fee of $14,000
and reimbursement of expenses.
5
<PAGE>
THE BOARD
ELECTION OF DIRECTORS (ITEM 1)
Four directors will be elected at the 1998 Annual Meeting, each for a three-year
term ending in 2001. The nominees, who are incumbents, are: John B. Adams, Jr.,
Benjamin J. Lambert, III, Richard L. Leatherwood and Frank S. Royal. Eight other
directors are serving terms that end in either 1999 or 2000.
Information about each nominee and the other directors is listed below. If the
year listed for a director is earlier than 1983, when Dominion Resources became
the parent corporation of Virginia Electric and Power Company (Virginia Power),
that
year represents the year first elected as a director of Virginia Power.
Your proxy will be voted to elect the nominees unless you tell us otherwise. If
any nominee is not available to serve (for reasons such as death or disability),
your proxy will be voted for a substitute nominee if the Board of Directors
nominates one.
NOMINEES FOR ELECTION (TERMS EXPIRING IN 2001)
<TABLE>
<CAPTION>
YEAR FIRST ELECTED YEAR FIRST ELECTED
A DIRECTOR TO AN A DIRECTOR OF
NOMINEE DIRECTORS AFFILIATE COMPANY DOMINION RESOURCES
<S> <C> <C>
JOHN B. ADAMS, JR., 53, Chairman, President and Chief 1987 1994
Executive Officer of Bowman Companies, a manufacturer
and bottler of alcohol beverages, Fredericksburg,
Virginia. He is a Director of Virginia Power.
BENJAMIN J. LAMBERT, III, 61, Optometrist, Richmond, 1992 1994
Virginia. He is a Director of Consolidated Bank and
Trust Company, Virginia Power and Student Loan
Marketing Association (Sallie Mae).
RICHARD L. LEATHERWOOD, 58, Retired, Baltimore, 1994
Maryland. Former President and Chief Executive Officer,
CSX Equipment, an operating unit of CSX Transportation,
Inc. He is a Director of Virginia Power and CACI
International Inc.
FRANK S. ROYAL, 58, Physician, Richmond, Virginia. 1994
He is a Director of Columbia/HCA Healthcare
Corporation,
Crestar Financial Corporation, Chesapeake Corporation,
CSX Corporation and Virginia Power.
</TABLE>
THE BOARD OF DIRECTORS RECOMMENDS THAT YOU VOTE FOR THESE NOMINEES.
6
<PAGE>
INCUMBENT DIRECTORS
<TABLE>
<CAPTION>
YEAR FIRST ELECTED YEAR FIRST ELECTED
A DIRECTOR TO AN A DIRECTOR OF
DIRECTORS WITH TERMS EXPIRING IN 2000 AFFILIATE COMPANY DOMINION RESOURCES
<S> <C> <C>
JOHN B. BERNHARDT, 68, Managing Director, Bernhardt/ 1981*
Gibson Financial Opportunities, financial services,
Newport News, Virginia. He is a Director of Virginia
Power and Resource Bank.
THOS. E. CAPPS, 62, Chairman, President and Chief 1986
Executive Officer of Dominion Resources (from August
15, 1994 to September 1, 1995, Chairman and Chief
Executive Officer; prior to August 15, 1994, Chairman,
President and Chief Executive Officer). He is Chairman
and a Director of Virginia Power and a Director of
Bassett Furniture Industries, Inc. and NationsBank
Corporation.
S. DALLAS SIMMONS, 58, President of Virginia Union 1992
University, Richmond, Virginia. He is a Director of
Virginia Power.
ROBERT H. SPILMAN, 70, President, Spilman Properties, 1994
Bassett, Virginia and Chairman of the Board and a
Director of Jefferson-Pilot Corporation, Greensboro,
North Carolina. Retired Chairman and Chief Executive
Officer of Bassett Furniture Industries, Inc. He is a
Director of International Home Furnishing Center, The
Pittston Company and Virginia Power.
</TABLE>
* From July 1986 through January 1987, Mr. Bernhardt served only as a director
on an affiliate company Board.
7
<PAGE>
<TABLE>
<CAPTION>
YEAR FIRST ELECTED YEAR FIRST ELECTED
A DIRECTOR TO AN A DIRECTOR OF
DIRECTORS WITH TERMS EXPIRING IN 1999 AFFILIATE COMPANY DOMINION RESOURCES
<S> <C> <C>
HARVEY L. LINDSAY, JR., 68, Chairman and Chief 1986 1994
Executive Officer of Harvey Lindsay Commercial Real
Estate, a commercial real estate firm, Norfolk,
Virginia. He is a Director of Virginia Power.
KENNETH A. RANDALL, 70, Corporate director for various 1971
companies, Williamsburg, Virginia. He is a Director of
Virginia Power, Kemper Insurance Companies, Oppenheimer
Funds, Inc. and Prime Retail, Inc.
WILLIAM T. ROOS, 70, Retired as of December 31, 1993 1975*
(before that, President of Penn Luggage, Inc., retail
specialty stores) Hampton, Virginia. He is a Director
of Virginia Power.
JUDITH WARRICK SACK, 49, Senior Advisor, as of 1989 1994
September 1, 1995, Morgan Stanley & Co., Inc., an
investment banking firm, New York, New York (prior
to September 1, 1995, Advisor). She is a Director of
Virginia Power.
</TABLE>
* From July 1986 through August 1994, Mr. Roos served only as a Director on the
boards of affiliate companies.
MEETING ATTENDANCE
The Board met 10 times in 1997. Each Board member attended at least 83% of the
total number of meetings of the Board and committees on which he or she served.
8
<PAGE>
COMMITTEES
The following is a listing of memberships of Dominion Resources standing
committees. Mr. Capps does not serve on any committees.
COMMITTEE MEMBERSHIPS
<TABLE>
<S> <C> <C> <C> <C>
DIRECTOR AUDIT O&C FINANCE NOMINATING
John B. Adams, Jr. X
John B. Bernhardt X X*
Benjamin J. Lambert, III X
Richard L. Leatherwood X X
Harvey L. Lindsay, Jr. X X
Kenneth A. Randall X* X
William T. Roos X X
Frank S. Royal X X X*
Judith Warrick Sack X X
S. Dallas Simmons X*
Robert H. Spilman X X
</TABLE>
* Indicates Chairman
AUDIT COMMITTEE. Six non-employee directors consult with the independent
auditors regarding the examination of Dominion Resources' and its subsidiaries'
(collectively, the Company) financial statements and the adequacy of internal
controls. The Committee reports to the Board of Directors on these matters and
recommends the independent auditors to be designated for the next year. In 1997,
the Audit Committee met twice.
ORGANIZATION AND COMPENSATION COMMITTEE (THE O&C COMMITTEE). Five non-employee
directors work closely with independent consultants and management to review the
Company's organizational and compensation structure and make recommendations on
these matters to the Board of Directors. They also administer certain
compensation plans. In 1997, the O&C Committee met seven times.
FINANCE COMMITTEE. Five non-employee directors review the Company's financing
strategies and consider dividend policy. In 1997, the Finance Committee met
twice.
NOMINATING COMMITTEE. Four non-employee directors review the qualifications of
director candidates suggested by Board members, management, shareholders and
others and recommend nominees for election as directors. In 1997, this Committee
met once.
9
<PAGE>
COMPENSATION AND OTHER PROGRAMS
FEES. During 1997, non-employee directors were paid an annual cash retainer of
$19,000 and $900 per Board or committee meeting attended. Committee chairs also
received $3,000 per year. Consistent with the Company's philosophy concerning
equity-based compensation for officers, effective in 1998 non-employee directors
will also receive an annual retainer in Dominion Resources common stock valued
at $19,000.
DOMINION RESOURCES DEFERRED CASH COMPENSATION PLAN. Directors may elect to
defer their cash fees under this plan until they reach retirement or a specified
age. The deferred fees are credited to either an interest bearing account or a
Dominion Resources common stock equivalent account. Interest or dividend
equivalents accrue until distributions are made. A director will be paid
according to the type of investment election made.
STOCK ACCUMULATION PLAN. Upon election to the Board, a non-employee director
receives a one-time award under this plan. The award is in Stock Units, which
are equivalent in value to Dominion Resources common stock. The award amount is
determined by multiplying the director's annual cash retainer by 17, then
dividing the result by the average price of Dominion Resources common stock on
the last trading days of the three months before the director's election to the
Board. The Stock Units awarded to a director are credited to a book account. A
separate account is credited with additional Stock Units equal in value to
dividends on all Stock Units held in the director's account. A director must
have 17 years of service to receive all of the Stock Units awarded and
accumulated under this plan. Reduced distributions may be made where a director
has at least 10 years of service.
CHARITABLE CONTRIBUTION PLAN. As part of its overall program of charitable
giving,
the Company offers the directors participation in a Directors' Charitable
Contribution Program. The Program is funded by life insurance policies purchased
by the Company on the directors. The directors derive no financial or tax
benefits from the Program, because all insurance proceeds and charitable tax
deductions accrue solely to the Company. However, upon the death of a director,
the Company will donate an aggregate of $50,000 per year for ten years to one or
more qualifying charitable organizations recommended by that director.
MATCHING GIFTS PROGRAM. Directors may give up to $1,000 per year to 501(c)3
organizations of their choice and the Company will match their donations on a
1-to-1 basis. If they volunteer more than 50 hours of work to any organization
during a year, the Company will match the donation on a 2-to-1 basis.
10
<PAGE>
DIRECTOR NOMINATIONS
Under our Bylaws, if you wish to nominate a director at a shareholders' meeting
you must be a shareholder and deliver written notice to our Corporate Secretary
at least 60 days before the meeting. If the meeting date has not been publicly
announced 70 days before the meeting, then notice can be given 10 days following
the public announcement. Any notice must include the following information:
- your name and address;
- each nominee's name and address;
- a statement that you are entitled to vote at the meeting and intend to
appear
in person or by proxy to nominate your nominees;
- a description of all arrangements or undertakings between you and each
nominee and any other person concerning the nomination;
- other information that would be included in a proxy statement soliciting
proxies for the election of directors; and
- the consent of the nominee to serve as a director.
11
<PAGE>
SHARE OWNERSHIP TABLE
The table below shows the amount of Dominion Resources common stock beneficially
owned as of February 20, 1998 by each director and executive officer named in
the compensation table on page 18. Also included in this table is stock
ownership for all directors and executive officers as a group.
<TABLE>
<CAPTION>
STOCK DIRECTOR
NAME OWNERSHIP PLAN ACCOUNTS(1)
<S> <C> <C>
John B. Adams, Jr. 3,891 9,091
John B. Bernhardt 1,500 9,091
Thos. E. Capps 44,914(2) --
Benjamin J. Lambert, III 90 10,212
Richard L. Leatherwood 1,000 17,616
Harvey L. Lindsay, Jr. 400 9,091
Kenneth A. Randall 3,027 9,091
William T. Roos 14,603(3) 9,091
Frank S. Royal -- 10,430
Judith Warrick Sack 1,000 14,575
S. Dallas Simmons 650 13,370
Robert H. Spilman 1,187 9,091
Norman B. M. Askew 1,290(2) --
Thomas N. Chewning 6,368(2) --
David L. Heavenridge 7,798(2) --
Robert J. Davies -- --
All directors and executive officers as a group
(23 persons) (4) 108,306(2)(5)
</TABLE>
(1) Amounts in this column represent share equivalents accumulated under
directors' plans described on page 10. Balances of 9,091 shares are the
amounts accumulated thus far under the Stock Accumulation plan. Because of
the plan's vesting provisions, these amounts will not necessarily be
distributed to a director. Any balance in excess of 9,091 is an amount of
shares accumulated - at the director's election - under the Deferred Cash
Compensation plan. That excess amount will be distributed in actual shares
to the director.
(2) Amounts include restricted stock as follows: Mr. Capps--23,984 shares; Mr.
Askew--1,290; Mr. Heavenridge--1,290 shares; Mr. Chewning--1,290 shares; and
all directors and executive officers as a group 34,317.
(3) Mr. Roos disclaims beneficial ownership of 4,387 shares that are held in
trusts for family members.
(4) All current directors and executive officers as a group own less than one
percent of the number of shares outstanding as of February 20, 1998.
(5) Beneficial ownership is disclaimed for a total of 4,786 shares.
12
<PAGE>
ORGANIZATION AND COMPENSATION
COMMITTEE REPORT
COMPENSATION PHILOSOPHY
We work with management and independent consultants to review regularly the
Company's compensation philosophy. Our programs must remain competitive in our
changing industry and support the Company's objectives. We also review the
compensation and performance of the CEO, Mr. Capps, and other senior executive
officers. Mr. Capps is not present when we discuss his performance and determine
his compensation.
During 1997, our Committee thoroughly re-evaluated the Company's compensation
programs. We recognize that attracting, retaining and motivating high caliber
employees is critical to the success of the Company. Following several meetings
with our independent consultant and management, we determined that the Company's
compensation program should be:
- competitive;
- driven by financial performance; and
- linked with your economic interests.
We believe that an effective pay program links executive compensation to Company
performance. Each year a significant portion of our executives' pay is placed at
risk based on total consolidated performance as well as individual business unit
performance.
1997 COMPENSATION
Our executive compensation program consists of three basic components:
- Base salary
- Annual incentive
- Long-term incentive
BASE SALARY
Our Committee targets the executive base salaries to be at or slightly below the
median base salaries of similar positions at peer companies in the diversified
utility industry and other business sectors in which the Company competes. We
also consider individual performance and competitive pressures.
13
<PAGE>
EXECUTIVE OFFICERS. Our independent compensation consultant analyzed our
executives' salaries and compared them with the Company's competitive labor
market. Our Committee also reviewed individual executive performance, and, as a
result, we approved base salary increases effective January 1, 1997.
CHIEF EXECUTIVE OFFICER. Our independent compensation consultant also reviewed
with us competitive compensation information for CEOs in a peer group of
diversified electric utility companies. After thoroughly evaluating this
material, considering our compensation philosophy, and recognizing Mr. Capps'
increased challenges as a CEO in a rapidly changing industry, we approved a base
salary of $715,000 for Mr. Capps, effective January 1, 1997.
ANNUAL INCENTIVE
Under the annual incentive program our Committee establishes "target awards" for
each executive officer. These target awards are expressed as a percentage of the
individual executive's base salary (for example, 30% x base salary). The target
award is the amount of cash that will be paid, at year-end, if the executive
achieves 100% of the goals established at the beginning of the year.
We also establish a "threshold"--or minimum acceptable level of financial
performance. If this threshold is not met, no employee receives an annual bonus.
Actual bonuses, if any, are based on a pre-established formula and may exceed
100% of the target award.
Consistent with our philosophy, if goals are fully met or exceeded, the
executive's total cash compensation for the year may be more than the median
total cash compensation for similar positions at companies in our competitive
executive labor market.
EXECUTIVE OFFICERS. For executive officers, 1997 net income was used as the
performance measure under the annual incentive plan. Each executive's goals were
weighted heavily toward the net income contribution of the business unit for
which he was responsible and also included a consolidated net income goal.
Our Committee established and approved the goals at the beginning of 1997. At
year-end, we compared the actual financial performance to the consolidated and
business unit net income goals. For 1997, these goals were surpassed, except at
Virginia Power. Net income for the business units is reported in the Management
Discussion and Analysis of Operations section of the 1997 Annual Report to
Shareholders.
14
<PAGE>
Because Mr. Askew was employed by three different business units during 1997, he
received pro-rated awards under each unit's plan. His award under the Dominion
Resources plan is described above. Under a separate Virginia Power plan, he
received a pro-rated award based on 80% goal achievement. Mr. Askew's goals were
weighted 50% on an Economic Value Added goal and 50% on performance drivers such
as customer retention, innovation and technology improvements and affirmative
action.
Mr. Askew also received an award under the East Midlands annual incentive plan
as did Mr. Davies. This plan had an earnings per share goal, which was achieved.
Annual bonuses paid to the named executives are detailed in the Summary
Compensation Table on page 18.
CHIEF EXECUTIVE OFFICER. At the beginning of 1997, we approved net income goals
for Mr. Capps. Eighty percent was weighted to the net income contribution of the
consolidated business units (excluding Virginia Power) and 20% to Virginia
Power's net income. Because the consolidated business unit goals were surpassed,
we approved an annual cash bonus of $491,015 for Mr. Capps. However, the
Virginia Power net income goal was not met.
LONG-TERM INCENTIVE
Long-term incentive plan goals are established and approved by our Committee at
the beginning of a performance cycle (typically three years). The actual
performance of the business units is evaluated at the end of the performance
cycle and compared with the previously approved goals.
During 1997, the Committee worked with our independent compensation consultant
to improve the design of the Company's long-term incentive programs. To ensure
that the executives' economic interests are united with our shareholders' and to
provide the executives with an opportunity to earn shares of Dominion Resources
common stock, we approved changes that will:
- align the program with the Company's business strategy, both at the
consolidated level and at the business unit level;
- provide for balance, flexibility and simplicity;
- align short and long-term incentive plan goals;
- provide award opportunities consistent with competitive practices for
general industry and businesses within the sectors in which the Company
competes; and
- bring all of Dominion Resources' businesses together under one incentive
framework.
15
<PAGE>
EXECUTIVE OFFICERS. Goals were established in 1995 for the 1995-1997
performance cycle. The performance measure used for certain executive officers
was growth in the combined net worth of Dominion Capital and Dominion Energy.
Based on 1997 year-end net worth, which exceeded the performance cycle goal, we
awarded the executives shares of restricted stock and cash (see the Summary
Compensation Table on page 18). The shares awarded cannot be sold for one year
and will be forfeited if the executive terminates employment during the year.
For a portion of 1997, Mr. Askew also participated in Virginia Power's long-term
program for the 1995-1997 performance cycle. The goals were:
<TABLE>
<CAPTION>
VIRGINIA POWER'S GOALS WEIGHT
<S> <C>
Total return to shareholders versus a peer group 50%
Virginia Power expense per kilowatt-hour versus the CPI 25%
Virginia Power return on equity versus peer group 25%
</TABLE>
Virginia Power did not achieve the first goal, surpassed the second goal and
partially achieved the third goal. As a result, Mr. Askew received a cash award
of $11,241.
CHIEF EXECUTIVE OFFICER. Goals for Mr. Capps were established in 1995 for the
1995-1997 performance cycle. We determined that his entire award, if any, should
be in Dominion Resources common stock. The goals were:
<TABLE>
<CAPTION>
MR. CAPPS' GOALS WEIGHT
<S> <C>
Total return to shareholders superior to the S&P Utility Index 50%
Specified annual growth in earnings per share 25%
Cost control of utility operating costs 25%
</TABLE>
Subject to achievement of these goals, we granted Mr. Capps 10,200 shares of
restricted stock at the beginning of the performance cycle. During the
performance cycle, Mr. Capps' dividends were reinvested to purchase additional
shares of stock. Because the first two goals were not met, Mr. Capps forfeited
all but 2,550 of the 10,200 originally granted and retained only 25% of the
shares purchased through dividend reinvestment during the performance cycle.
16
<PAGE>
DEDUCTIBILITY OF COMPENSATION
Under Section 162(m) of the Internal Revenue Code, the Company may not deduct
certain forms of compensation in excess of $1 million paid to our Chief
Executive Officer or any of the four other most highly compensated executive
officers. However, certain performance-based compensation is specifically exempt
from the deduction limit.
It is our intent to provide competitive executive compensation while maximizing
the Company's tax deduction. However, we may approve non-deductible compensation
if we believe it is in the Company's best interest.
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
Mr. Spilman, a member of the O&C Committee, was Chairman and Chief Executive
Officer of Bassett Furniture Industries, Inc. for a portion of 1997. Mr. Capps
is also
a Director of Bassett Furniture Industries, Inc.
Kenneth A. Randall, Chairman
John B. Adams, Jr.
John B. Bernhardt
Frank S. Royal
Robert H. Spilman
17
<PAGE>
EXECUTIVE COMPENSATION
The table below shows the total salary and bonus payments awarded to or earned
by the CEO and the four other most highly compensated executive officers (as of
December 31, 1997).
SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>
LONG-TERM
COMPENSATION
AWARDS PAYOUTS
ANNUAL COMPENSATION RESTRICTED
OTHER ANNUAL STOCK LTIP ALL OTHER
NAME AND PRINCIPAL POSITION YEAR SALARY(1) BONUS(1) COMPENSATION(2) AWARDS(3) PAYOUTS(4) COMPENSATION(5)
($) ($) ($) ($) ($) ($)
<S> <C> <C> <C> <C> <C> <C> <C>
THOS. E. CAPPS 1997 775,172 491,015 7,708 0 129,675 4,800
Chairman, President & CEO 1996 668,075 345,538 0 286,875 122,348 4,500
1995 628,408 313,803 0 0 132,315 4,500
NORMAN B. M. ASKEW 1997 393,006 279,174 17,782 0 124,730 206,482
Executive Vice President
(President & CEO--
Virginia Power)
ROBERT J. DAVIES 1997 334,340 195,494 -- 0 83,271 2,002
Chief Executive--
East Midlands
DAVID L. HEAVENRIDGE 1997 322,199 167,456 571 0 105,939 243,770
Executive Vice President 1996 250,338 118,762 0 0 61,237 4,500
(President--Dominion 1995 199,226 98,820 0 0 92,713 4,500
Capital)
THOMAS N. CHEWNING 1997 303,730 167,706 418 0 105,939 247,112
Executive Vice President 1996 232,838 118,762 0 0 61,237 4,925
(President--Dominion 1995 197,983 98,820 0 0 92,713 4,500
Energy
</TABLE>
NOTE: DOMINION RESOURCES HAS NOT ISSUED OPTIONS FOR THE PAST THREE YEARS.
18
<PAGE>
FOOTNOTES TO SUMMARY COMPENSATION TABLE
(1) SALARY AND BONUS. The dollar amounts for Mr. Askew and Mr. Davies include
amounts paid to them in British pounds sterling, based on an exchange rate
of $1.60 per British pound.
(2) OTHER ANNUAL COMPENSATION. None of the named executives received perquisites
or other personal benefits in excess of $50,000 or 10% of their total cash
compensation.
(3) RESTRICTED STOCK. Dividends are paid on restricted stock. The number and
value of each executive's restricted stock holdings at year end, based on a
December 31, 1997 closing price of $42.5625, were as follows:
<TABLE>
<CAPTION>
OFFICER NUMBER OF RESTRICTED SHARES VALUE
<S> <C> <C>
Thos. E. Capps 32,302 $1,374,854
Norman B. M. Askew 0 0
Robert J. Davies 0 0
David L. Heavenridge 798 $ 33,965
Thomas N. Chewning 798 $ 33,965
</TABLE>
(4) LTIP PAYOUTS. Amounts in this column represent payouts under three long-term
plans (Dominion Resources, Virginia Power and East Midlands) for performance
cycles that ended in 1997, as described on pages 15 and 16. The chart below
details these amounts for each executive.
<TABLE>
<CAPTION>
NUMBER OF RESTRICTED SHARES
OFFICER AWARDED CASH AWARDED
<S> <C> <C>
Thos. E. Capps 3,120 0
Norman B. M. Askew 1,290 $ 73,694
Robert J. Davies 1,014(*) $ 43,155
David L. Heavenridge 1,290 $ 54,903
Thomas N. Chewning 1,290 $ 54,903
</TABLE>
(*) Mr. Davies has an agreement with the Company to receive these shares
(plus reinvested dividends) at the end of the one year restricted period.
(5) ALL OTHER COMPENSATION. During 1997, the following payments were made to the
named executives: (a) Dominion Resources matching contribution on Employee
Savings Plan contributions (Mr. Capps, $4,800; Mr. Heavenridge, $4,750; and
Mr. Chewning, $4,800); (b) $2,002 paid to Mr. Askew and Mr. Davies related
to the cancellation of East Midlands Sharesave employee plan as a result of
the acquisition of East Midlands by Dominion Resources; (c) a special
dividend paid by East Midlands to Mr. Askew ($84,480); (d) payments made to
Mr. Heavenridge ($239,020) and Mr. Chewning ($242,312) at the end of a
three-year employment agreement with Dominion Resources and (e) a one-time
payment to Mr. Askew ($120,000) related to his international transfer from
the United Kingdom to the United States.
19
<PAGE>
LONG-TERM INCENTIVE PLANS--AWARDS IN LAST FISCAL YEAR
<TABLE>
<CAPTION>
PERFORMANCE
OR OTHER ESTIMATED FUTURE
NUMBER OF PERIOD PAYOUTS
SHARES, UNTIL UNDER NON-STOCK
UNITS MATURATION PRICE-BASED PLANS
OR OTHER OR THRESHOLD TARGET
OFFICER RIGHTS (#) PAYOUT ($ OR #) ($ OR #)
<S> <C> <C> <C> <C>
Thos. E. Capps $ 514,800 3 years $ 257,400 $ 514,800
Norman B. M. Askew $ 275,000 3 years $ 137,500 $ 275,000
Robert J. Davies $ 204,000 3 years $ 102,000 $ 204,000
David L. Heavenridge $ 173,250 3 years $ 86,625 $ 173,250
Thomas N. Chewning $ 173,250 3 years $ 86,625 $ 173,250
</TABLE>
The above table reflects the target awards that will be made to these executives
for the 1997-1999 performance cycle of the long-term incentive program if
specified goals are achieved. The established goals for our executives (except
for Mr. Askew) are cumulative net income over the three-year performance period.
These goals are weighted as follows:
<TABLE>
<CAPTION>
DOMINION DOMINION DOMINION DOMINION VIRGINIA
OFFICER CONSOLIDATED COMPANIES CAPITAL ENERGY UK(*) POWER
<S> <C> <C> <C> <C> <C> <C>
Thos. E. Capps 50% 50%
Norman B. M. Askew 50% 50%
Robert J. Davies 50% 50%
David L. Heavenridge 50% 50%
Thomas N. Chewning 50% 50%
</TABLE>
(*) The actual goal is based on Dominion UK Holding, Inc., our United Kingdom
holding company. East Midlands is the principal subsidiary of Dominion UK.
NOTE: Mr. Askew's Virginia Power goals are weighted 25% Virginia Power operating
profit and 25% Virginia Power net cash flow.
20
<PAGE>
At the end of the 1997-1999 performance cycle, actual performance will be
measured against these pre-established goals. At 100% goal achievement, the
target award will be paid one-half in cash and one-half in shares of restricted
stock. The stock will be restricted for two years. During this time the shares
cannot be sold and subject to the provision of the executive's employment
agreement will be forfeited by the executive if he terminates employment.
No awards will be paid if the threshold level of performance, which was
established at the beginning of the performance cycle, is not reached. Above the
threshold level, performance will be measured and awards will be paid based on
the percent of goal achievement and may exceed 100% (for example: 75% goal
achievement, 100% goal achievement, 110% goal achievement).
AGGREGATED OPTIONS/SAR EXERCISES IN LAST FISCAL YEAR
Dominion Resources has not granted options for several years (see Summary
Compensation Table on page 18). Prior to the acquisition of East Midlands by the
Company, East Midlands granted options to their executives (Mr. Askew and Mr.
Davies) and these options were exercised as reported below.
<TABLE>
<CAPTION>
SHARES ACQUIRED VALUE
OFFICER ON EXERCISE(#) REALIZED($)
<S> <C> <C>
Thos. E. Capps 0 $ 0
Norman B. M. Askew 44,000(1) $124,822(2)
Robert J. Davies 0(3) $369,827(3)
David L. Heavenridge 0 $ 0
Thomas N. Chewning 0 $ 0
</TABLE>
(1) Represents East Midlands shares.
(2) Represents the spread received upon the exercise of East Midlands options
and the value of 31,372 shares of UK National Grid shares that were awarded
upon exercise of these options.
(All amounts are based on an exchange rate of $1.60 per British pound.)
(3) 66,650 East Midlands phantom options purchased by Dominion Resources when it
acquired East Midlands.
21
<PAGE>
PERFORMANCE GRAPH
The table below shows the five year cumulative total return comparison between
Dominion Resources, the S&P 500 Index and the S&P Utility Index.
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<TABLE>
<CAPTION>
TOTAL RETURN TO SHAREHOLDERS
<S> <C> <C> <C>
Dominion Resources S&P 500 S&P Util Index
1992 $100.00 $100.00 $100.00
1993 $121.44 $110.08 $114.44
1994 $102.84 $111.53 $105.35
1995 $126.11 $153.45 $149.63
1996 $125.86 $188.68 $154.30
1997 $149.01 $251.63 $192.34
</TABLE>
RETIREMENT PLANS
The table below shows the estimated annual straight life benefit that the
Company would pay to an employee at normal retirement (age 65) under the benefit
formula of the Retirement Plan.
<TABLE>
<CAPTION>
ESTIMATED ANNUAL BENEFITS PAYABLE UPON
RETIREMENT--
CREDITED YEARS OF SERVICE
FINAL AVERAGE
EARNINGS 15 20 25 30
<S> <C> <C> <C> <C>
$ 185,000 $ 51,501 $ 68,668 $ 85,835 $ 103,003
200,000 56,068 74,758 93,448 112,138
225,000 63,681 84,908 106,135 127,363
250,000 71,294 95,058 118,823 142,588
300,000 86,519 115,358 144,198 173,038
350,000 101,744 135,658 169,573 203,488
400,000 116,969 155,958 194,948 233,938
450,000 132,194 176,258 220,323 264,388
500,000 147,419 196,558 245,698 294,838
550,000 162,644 216,858 271,073 325,288
600,000 177,869 237,158 296,448 355,738
650,000 193,094 257,458 321,823 386,188
750,000 223,544 298,058 372,573 447,088
</TABLE>
22
<PAGE>
DOMINION RESOURCES RETIREMENT PLAN. Benefits under the Retirement Plan are
based on:
- average base salary over a five year period when base pay is highest;
- years of credited service;
- age at retirement; and
- the offset of Social Security benefits.
In addition, certain officers, if they reach a specified age while still
employed, will be credited with additional years of service. For the executives
named in the Summary Compensation Table on page 18, credited years of service at
age 60 would be 30 years. Mr. Davies does not participate in this plan. Other
retirement agreements and arrangements for the named executives are described
below.
DOMINION RESOURCES BENEFIT RESTORATION PLAN. The Retirement Plan pays a benefit
calculated on base pay alone. It does not include incentive pay which is a
significant portion of our executives' total compensation. As a result, in 1997
the O&C Committee approved a market-based adjustment to executive base salaries
of 10% for use in calculating the retirement benefit under the Benefit
Restoration Plan.
The difference between the benefit calculated on the market-based salary and the
benefit paid by the Retirement Plan is provided to the executive by the Benefit
Restoration Plan.
Also, the Internal Revenue Code imposes certain limits related to Retirement
Plan benefits. Any resulting reductions in Retirement Plan benefits will be
compensated for under the Benefit Restoration Plan. Mr. Davies does not
participate in this plan.
EAST MIDLANDS PENSION PLAN. Benefits under this retirement plan are based on:
- highest annual salary in final five years of service; and
- years of pensionable service.
Because Mr. Askew no longer participates in this plan his fixed annual benefit
at age 60 is $11,010 adjusted annually for inflation. Currently, Mr. Davies
estimated annual benefit at age 60 will be $32,912.
EAST MIDLANDS RETIREMENT BENEFIT RESTORATION PLAN. The UK Inland Revenue also
imposes limits on Pension Plan benefits. Under this benefit plan (known in the
UK as an Unfunded Unapproved Retirement Benefit Scheme), any Pension Plan
benefits reduced due to these limitations will be reimbursed by this plan. Mr.
Askew's annual benefit at age 60 is expected to be $59,475. Mr. Askew's payments
under the Dominion Resources Retirement Plan will be reduced by the amount he
receives from this benefit plan and the East Midlands Pension Plan. At age 60,
Mr. Davies' annual benefit will be 50% of his final pensionable salary.
23
<PAGE>
EXECUTIVE SUPPLEMENTAL RETIREMENT PLAN. The Supplemental Plan provides an annual
retirement benefit equal to 25% of a participant's final cash compensation (base
salary plus annual bonus). To retire with full benefits under the Supplemental
Plan, an executive must be 55 years old and have been employed for at least five
years. Benefits under the plan are provided either as a lump sum cash payment at
retirement or as a monthly annuity paid out, typically over 10 years. Based on
1997 cash compensation, the estimated annual benefit under this plan for the
executives named in the Summary Compensation Table on page 18 are: Mr. Capps:
$286,125; Mr. Askew $167,406; Mr. Heavenridge: $90,625 and Mr. Chewning:
$90,625. Mr. Davies does not participate in this plan.
OTHER EXECUTIVE AGREEMENTS AND ARRANGEMENTS
Companies that are in a rapidly changing industry such as ours require the
expertise and loyalty of exceptional executives. Not only is the business itself
competitive, but so is the demand for such executives. To secure the continued
services and focus of our key management executives, the Company has entered
into employment agreements with them, including those named in the Summary
Compensation Table on page 18.
EMPLOYMENT AGREEMENT--CHIEF EXECUTIVE OFFICER. The Board of Directors determined
in June 1997 that it was in the Company's best interest to secure Mr. Capps'
employment as CEO and President of Dominion Resources until December 31, 2002.
As a result, Mr. Capps entered into an agreement providing for his employment as
CEO and President until 2002. During his employment, the agreement provides for
the following: (1) an annual base salary of at least $715,000, (2) incentive
compensation based on performance and (3) continued eligibility for all employee
benefit and incentive plans provided by the Company for its senior management.
When his employment ends (whether or not before the end of the term of the
agreement), Mr. Capps will: (1) receive a retirement benefit calculated on the
highest base salary rate during his employment, (2) receive a Supplemental Plan
benefit payable for life, (3) become fully vested in his outstanding restricted
stock and (4) receive a payment of $950,000 plus an amount equal to the present
value of his salary and annual cash incentives for the calendar year 2002.
During the term of the agreement, the Company may terminate Mr. Capps for cause
only. Mr. Capps also receives age and service credit and continued benefit plan
coverage through the end of the contract period in the event of termination for
cause or resignation for cause.
24
<PAGE>
EMPLOYMENT AGREEMENTS--OTHER EXECUTIVES. Mr. Heavenridge and Mr. Chewning have
employment agreements for a three-year period ending September 12, 2000. Mr.
Askew has an employment agreement that terminates on November 1, 2002. During
employment, each of these executives will continue to receive a salary at least
equal to his salary on the date of the agreement and will be eligible for
bonuses and all employee benefits provided by the Company for its senior
management. If Dominion Resources terminates the executive's employment without
cause or reduces or does not pay the executive's salary, incentives and other
benefits during the contract period or demotes the executive to a position that
is not a senior management position, the executive will (subject to notice and
remedy provisions): (1) receive a lump sum payment equal to the present value of
salary and, Mr. Heavenridge and Mr. Chewning, bonus for the balance of the
contract period, (2) vest in his outstanding restricted stock and (3) receive
age and service credit and continued benefit plan coverage through the end of
the contract period. The agreements also provide benefits in the event of death
or disability. In the case of a change in control (*), the executive will not
receive pay under this agreement as a result of his termination of employment
for any reason if he receives payment under his Employment Continuity Agreement
(described below). Mr. Askew's agreement also provides that he will not compete
with the Company in the UK for a one year period beginning with the date of
termination of employment.
Mr. Davies has an agreement with East Midlands that provides continued
employment unless terminated by East Midlands with no less than two years'
notice or terminated by Mr. Davies with no less than one year's notice. During
the term of the agreement, Mr. Davies receives a (1) base salary at least equal
to his annual base salary on the date of the agreement; (2) eligibility for
performance-related bonuses each year; and (3) participation in East Midlands
pension plan and other benefits typically provided to an executive at his level.
East Midlands can terminate Mr. Davies' employment for any reason without two
years' notice, by paying him an amount equal to his base salary for the two year
period. If East Midlands terminates Mr. Davies' agreement in breech of contract
(without cause), he will be paid an amount equal to 1.5 times his base salary.
Mr. Davies' agreement also provides that he will not compete with East Midlands
for a one year period beginning with the date of termination of employment.
Under this agreement, Mr. Davies will retire at age 60.
- ---------------------
(*) A change in control shall be deemed to have occured if (i) any person or
group becomes a beneficial owner of 20%
or more of the combined voting power of Dominion Resources voting stock or
(ii) as a direct or indirect result of or in connection with, a cash tender
or exchange offer, merger or other business combination, sale of assets, or
contested election, the Directors constituting the Dominion Resources Board
before any such transactions cease to represent a majority of Dominion
Resources' or its successor's Board within two years after the last of such
transactions.
25
<PAGE>
SPECIAL ARRANGEMENTS. Dominion Resources has entered into employment continuity
agreements with executives named in the Summary Compensation Table (but not Mr.
Capps), which provide benefits in the event of a change in control. Each
agreement has a three-year term and is automatically extended for an additional
year, unless cancelled by the Company.
The agreements provide for the continuation of salary and benefits for a maximum
period of three years after either (1) a change in control, (2) termination
without cause following a change in control or (3) a reduction of
responsibilities, salary and incentives following a change in control (if the
executive gives 60 days notice). Payment of this benefit will be made in either
a lump sum or installments over three years. In addition, the agreements
indemnify the executives for potential penalties related to the Internal Revenue
Code and fees associated with the enforcement of the agreements. If an executive
is terminated for cause, the agreements are not effective.
EXECUTIVE DEFERRED COMPENSATION PLAN. Under this plan, executives may defer any
portion of their base salary, annual incentive cash award and/or long-term
incentive cash award. Deferrals are credited at the executive's discretion, for
bookkeeping purposes, with earnings and losses as if they were invested in any
of several mutual fund options or Dominion Resources common stock. Distributions
are made at the direction of the executive. Mr. Davies does not participate in
this plan.
SECTION 16(A) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
Our directors and officers report their common stock transactions with the SEC.
One of our directors, Benjamin J. Lambert, III, did not report a 1997 common
stock purchase in a timely manner. The report has now been filed with the SEC.
DESIGNATION OF AUDITORS (ITEM 2)
The Board of Directors has designated Deloitte & Touche LLP, independent
certified public accountants, as auditors of the 1998 consolidated financial
statements of Dominion Resources. Representatives of Deloitte & Touche LLP will
be present at
the Annual Meeting and will have an opportunity to make a statement if they
desire to do so and will be available to respond to shareholder questions.
THE BOARD OF DIRECTORS RECOMMENDS THAT YOU RATIFY THE DESIGNATION OF
DELOITTE & TOUCHE LLP.
26
<PAGE>
OTHER INFORMATION
MATTERS BEFORE THE 1998 ANNUAL MEETING
The management and directors are not aware of any matters which may come before
the Annual Meeting other than the matters stated in the Notice of the
Annual Meeting.
PROPOSALS FOR THE 1999 ANNUAL MEETING
Under our Bylaws, if you wish to bring any matter (other than shareholder
nominations of director candidates) before the 1999 Annual Meeting, you must
notify the Corporate Secretary in writing no later than January 18, 1999.
Regarding each matter, the notice must contain:
- a brief description of the business to be brought before the Annual
Meeting, including the complete text of any related resolutions to be
presented and the reasons for conducting such business at the meeting;
- the name and address of record of the shareholder proposing such business;
- the class and number of shares of stock that are beneficially owned by the
shareholder; and
- any material interest of the shareholder in such business.
For a shareholder proposal to be considered for possible inclusion in the 1999
Proxy Statement, it must be received by the Corporate Secretary of Dominion
Resources no later than November 11, 1998. Dominion Resources plans to hold its
1999 Annual Meeting on April 16, 1999.
1997 FORM 10-K
YOU MAY REQUEST, WITHOUT CHARGE, A COPY OF DOMINION RESOURCES' ANNUAL REPORT
FILED ON FORM 10-K WITH THE SECURITIES AND EXCHANGE COMMISSION FOR 1997,
EXCLUDING EXHIBITS, BY: (1) WRITING TO THE CORPORATE SECRETARY, DOMINION
RESOURCES, INC., P. O. BOX 26532, RICHMOND, VIRGINIA 23261; (2) E-MAIL US AT
[email protected]; OR (3) CALL US AT 804-775-5700.
27
<PAGE>
[LOGO]
1998 Proxy Statement
<PAGE>
Dominion Resources PROXY THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF
DIRECTORS.
The Board of Directors Recommends a Vote "FOR" items 1 and 2.
Please Mark Your Choice Like /X/
This in Blue or Black Ink.
- ------------------------------------------------------------------------------
1. ELECTION OF DIRECTORS
/ / FOR the following nominees: JOHN B. ADAMS, JR BENJAMIN J.
LAMBERT, III
RICHARD L. LEATHERWOOD, FRANK S.
ROYAL
/ / WITHHOLD AUTHORITY to vote for all nominees listed above.
To withhold authority to vote for any
individual nominee, write that
nominee's name in the space provided
below.
____________________________________________________________________________
2. PROPOSAL TO RATIFY THE DESIGNATION OF AUDITORS
/ / FOR
/ / AGAINST
/ / ABSTAIN
- --------------------------------------------------------------------------------
The undersigned appoints THOS. E. CAPPS, KENNETH A. RANDALL and PATRICIA A.
WILKERSON, or any one of them, with power of substitution, proxies to vote
all shares of the undersigned at the Annual Meeting of Shareholders on
April 17, 1998, and at any and all adjournments thereof.
Date , 1998
---------------------------------------------------------------
Signature
------------------------------------------------------------------
Signature
------------------------------------------------------------------
If Held Jointly
(Please mark, date, sign and mail in the enclosed envelope)
<PAGE>
Dominion Resources
Dominion Resources, Inc.
P.O. Box 26532, Richmond, Virginia 23261
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
In their discretion, the proxies are authorized to vote on any matters
that properly come before the meeting.
This proxy when properly executed will be voted as directed by the signed
shareholder. If no direction is made, this proxy will be voted "FOR" Items 1
and 2.
Plese sign exactly as your name appears on the reverse side of this
proxy. When shares are held by joint tenants, both shareholders should sign.
When signing in a representative capacity, please give your representative
title. If a corporation, please sign in full corporate name by President or
other authorized officer. If a partnership, please sign in partnership name
by authorized person.
(Please date and sign on other side)
