As filed with the Securities and Exchange Commission on May 10, 1999
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 of incorporation (I.R.S. Employer Identification
or organization) No.)
120 TREDEGAR 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, Vice President and Corporate Secretary
W. H. Riggs, Jr., Assistant Corporate Secretary
DOMINION RESOURCES, INC.
120 Tredegar Street, Richmond, Virginia 23219
(Name and address of agent for service)
(804) 819-2000
(Telephone number, including area code, of agent for service)
CALCULATION OF REGISTRATION FEE*
Proposed Proposed
Title of Each Amount Maximum Maximum Amount of
Class of Securities to be Offering Price Aggregate Registration
to be Registered Registered Per Share Offering Price Fee
Common Stock, without 8,000,000 $41.0625 $328,500,000 $91,323
par value 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 May 6, 1999.
<PAGE>
Dominion Resources, Inc. is registering an additional 8,000,000 shares of
common stock, without par value, relating to an earlier filed employee
benefit plan, the Dominion Resources, Inc. Incentive Compensation Plan
(the Plan), which was filed and registered with the Securities and Exchange
Commission on April 22, 1997, File No. 333-25587, registering 3,000,000
shares of common stock under the Plan (filing fee paid $31,250) which is hereby
incorporated herein by reference.
Exhibits
5 Opinion of James F. Stutts, Vice President and General Counsel of Dominion
Resources, Inc. (filed herewith)
23 Consent of Deloitte & Touche (filed herewith)
99 Dominion Resources, Inc. Incentive Compensation Plan as restated effective
April 16, 1999 (filed herewith)<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 10th day of May, 1999.
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 by the following persons in the
capacities indicated and on the 10th of May, 1999. The officers and
directors whose signatures appear below hereby constitute Patricia A.
Wilkerson or W. H. Riggs, Jr., either of whom may act, as their true and
lawful attorneys-in fact, with full power to sign on their behalf
individually and in each capacity stated below and file all amendments and
post-effective amendments to the registration statement making such changes in
the registration statement as the registrant deems appropriate, and generally
to do all things in their name and in their capacities as officers and directors
to enable the registrant to comply with the provisions of the Securities Act
of 1933 and all requirements of the Securities and Exchange Commission.
Signature Title
/s/JOHN B. ADAMS, JR.
John B. Adams, Jr. Director
John B. Bernhardt Director
/s/THOS. E. CAPPS
Thos. E. Capps Chairman of the Board of Directors,
President and Chief Executive Officer
/s/JOHN W. HARRIS
John W. Harris Director
/s/BENJAMIN J. LAMBERT, III
Benjamin J. Lambert, III Director
<PAGE>
Signature
Richard L. Leatherwood Director
/s/K. A. RANDALL
K. A. Randall Director
/s/FRANK S. ROYAL
Frank S. Royal Director
/s/S. DALLAS SIMMONS
S. Dallas Simmons Director
/s/ROBERT H. SPILMAN
Robert H. Spilman Director
/s/JUDITH B. WARRICK
Judith B. Warrick Director
/s/DAVID A. WOLLARD
David A. Wollard Director
/s/THOMAS N. CHEWNING
Thomas N. Chewning Executive Vice President (Chief Financial
Officer)
/s/J. L. TRUEHEART
J. L. Trueheart Senior Vice President and Controller
(Principal Accounting Officer)
<PAGE>
EXHIBIT INDEX
Sequentially
Exhibit No. Exhibit Number Page
5 Opinion of James F. Stutts, Esq., Vice President and
General Counsel of Dominion Resources, Inc.
(filed herewith).
23 Consent of Deloitte & Touche LLP (filed herewith).
99 Dominion Resources, Inc. Incentive Compensation
Plan as restated effective April 16, 1999 (filed herewith)
Exhibit 5
May 10, 1999
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 8,000,000 shares of
common stock, without par value, (Common Stock) 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/JAMES F. STUTTS
James F. Stutts, Esq.
Vice President and General Counsel
Dominion Resources, Inc.
Exhibit 23
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 8, 1999
(February 22, 1999 as to Note X) incorporated by reference in the Annual
Report on Form 10-K of Dominion Resources, Inc. for the year ended
December 31, 1998.
DELOITTE & TOUCHE LLP
Richmond, Virginia
May 10, 1999
Exhibit 99
DOMINION RESOURCES, INC.
INCENTIVE COMPENSATION PLAN
Restated effective April 16, 1999
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. 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) ''Applicable Withholding Taxes'' means the aggregate amount of federal,
state and local income and payroll taxes that an Employer is required to
withhold in 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.
(c) ''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 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.
(d) ''Code'' means the Internal Revenue Code of 1986, as amended.
(e) ''Committee'' means, effective April 16, 1999, 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 Committee for purposes of the Plan.
Prior to April 16, 1999, the Organization and Compensation Committee of
Virginia Electric and Power Company had certain functions under the Plan.
Any actions taken by that Committee prior to April 16, 1999 shall be treated
as if taken by the Committee.
(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 the Committee grants an
Incentive Award.
(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 Committee shall determine whether a Disability exists
and such determination shall be conclusive.
(i) ''Dominion Company'' means Virginia Electric and Power Company, Dominion
Capital, Inc., Dominion Energy, Inc., or another corporation 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.
(j) ''DRI'' means Dominion Resources, Inc.
(k) ''DRI Board'' means the Board of Directors of Dominion Resources, Inc.
(l) ''Employer'' means DRI and each Dominion Company that employs one or more
Participants.
(m) ''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.
(n) ''Goal-Based Stock'' means Company Stock awarded when performance goals
are achieved pursuant to an award as provided in Section 8.
(o) ''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.
(p) ''Incentive Stock Option'' means an Option intended to meet the
requirements of, and qualify for favorable federal income tax treatment
under, Code section 422.
(q) ''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.
(r) ''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.
(s) ''Option'' means a right to purchase Company Stock granted under the
Plan, at a price determined in accordance with the Plan.
(t) ''Participant'' means any employee of DRI or a Dominion Company who
receives an Incentive Award under the Plan.
(u) ''Performance Criteria'' means any of the following areas of performance
of DRI or any Dominion Company: 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 Committee).
(v) ''Performance Goal'' means an objectively determinable performance goal
established by the Committee with respect to a given Performance Grant or grant
of Restricted Stock that relates to one or more Performance Criteria.
(w) ''Performance Grant'' means an Incentive Award made pursuant to Section 6.
(x) ''Plan Year'' means January 1 to December 31.
(y) ''Restricted Stock'' means Company Stock awarded upon the terms and
subject to the restrictions set forth in Section 7.
(z) ''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.
(aa) ''Stock Appreciation Right'' means a right to receive amounts from the
Employer granted under Section 10.
(bb) ''Taxable Year'' means the fiscal period used by DRI for reporting taxes
on income under the Code.
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 eleven million (11,000,000) 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 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 one million five hundred thousand (1,500,000)
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 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. The Committee 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 Committee shall establish the Performance Goals for Performance
Grants. The 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 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 Committee. The 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 Committee and the 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 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 the 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 Committee may make grants of Restricted Stock to Participants.
Whenever the 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 the 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
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 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 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
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 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 Committee may make grants of Goal-Based Stock to Participants.
Whenever the 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.
(b) Goal-Based Stock may be issued pursuant to the Plan from time to time by
the Committee when performance criteria established by the Committee have been
achieved and certified by the Committee.
(c) Whenever the 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
Participant 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 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 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 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 Committee may make grants of Options to Participants. Whenever the
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 Committee deems it appropriate, Stock Appreciation Rights may
be granted in connection with all or any part of an Option to a 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 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 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
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 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
shareholder 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 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 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 sentence, 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 the Committee, whose
determination shall be binding on all persons. If the adjustment would
produce fractional shares with respect to any unexercised Option, the
Committee 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 Committee may
take such actions with respect to outstanding Incentive Awards as the
Committee deems appropriate.
(c) Notwithstanding anything in the Plan to the contrary, the Committee may
take the foregoing actions without the consent of any Participant, and the
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 Committee. The Committee shall have general authority
to impose any limitation or condition upon an Incentive Award the Committee
deems 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 Participant (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. The
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) All grants of Incentive Awards made or approved by the Committee shall be
submitted to the DRI Board for such consideration as the DRI Board deems
appropriate.
(c) The Committee may adopt rules and regulations for carrying out the Plan
with respect to Participants. The interpretation and construction of any
provision of the Plan by the Committee shall be final and conclusive as to
any Participant. The 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 the Committee shall constitute a quorum, and
all actions of the 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; and (b) 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.
19. Grants To Outside Directors. In addition to the Awards otherwise
provided under the Plan, the Plan also permits the award of Nonstatutory
Stock Options and Restricted Stock to directors on the DRI Board or the board
of any Dominion Company if such directors are not employees of DRI or a
Dominion Company ("Outside Directors"). The DRI Board shall have the power
and complete discretion to select Outside Directors of DRI or any Dominion
Company to receive Awards. The DRI Board shall have the complete discretion,
under provisions consistent with Section 12 as to Participants, to determine
the terms and conditions, the nature of the award and the number of shares to
be allocated as part of each Award for each Outside Director of DRI or a
Dominion Company. The grant of an Award shall not obligate DRI or any
Dominion Company to make further grants to the Outside Director at any
time thereafter or to retain any person as a director for any period of time.
