<PAGE>
Filed pursuant to Rule 424(b)(5)
Registration No. 333-35501
PROSPECTUS SUPPLEMENT
(To prospectus dated September 17, 1997)
6,000,000 Shares
[LOGO OF DOMINION] Dominion Resources, Inc.
Common Stock
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All of the shares of common stock being offered are being sold by Dominion.
Our common stock is listed and traded on the New York Stock Exchange under the
symbol "D." The shares of common stock offered hereby will also be listed on
the New York Stock Exchange. The reported last sale price of the
common stock on the New York Stock Exchange on November 20, 2000 was $62 7/8
per share.
The underwriter has agreed to purchase from Dominion the shares of common
stock offered hereby for a purchase price of $59.07 per share. The proceeds to
Dominion from the sale of the shares of common stock will be $354,420,000.
The common stock offered hereby may be offered by the underwriter from time
to time to purchasers directly or through agents, or through brokers in
brokerage transactions on the New York Stock Exchange, or to dealers in
negotiated transactions or in a combination of such methods of sale, at a
fixed price or prices, which may be changed, or at market prices prevailing at
the time of sale, at prices related to such prevailing market prices or at
negotiated prices.
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Neither the Securities and Exchange Commission nor any state securities
commission has approved or disapproved of these securities or determined if
this prospectus supplement or the accompanying prospectus is truthful or
complete. Any representation to the contrary is a criminal offense.
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The shares of common stock will be ready for delivery on or about
November 27, 2000.
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Merrill Lynch & Co.
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The date of this prospectus supplement is November 21, 2000.
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Table of Contents
<TABLE>
<CAPTION>
Page
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Prospectus Supplement
<S> <C>
Where You Can Find More Information........................................ S-3
Forward Looking Information................................................ S-3
Dominion................................................................... S-4
Common Stock Price Range and Dividends..................................... S-9
Capitalization............................................................. S-10
Use of Proceeds............................................................ S-11
Description of Common Stock................................................ S-11
Underwriting............................................................... S-14
Legal Opinions............................................................. S-16
Prospectus
About This Prospectus...................................................... 2
Where You Can Find More Information........................................ 2
The Company................................................................ 3
Use of Proceeds............................................................ 3
Ratio of Earnings to Fixed Charges......................................... 3
Description of Debt Securities............................................. 3
Description of Capital Stock............................................... 7
Virginia Stock Corporation Act and the Articles and the Bylaws............. 8
Plan of Distribution....................................................... 11
Legal Opinions............................................................. 12
Experts.................................................................... 12
</TABLE>
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This document is in two parts. The first part is the prospectus supplement,
which describes the specific terms of the shares of common stock we are
offering and certain other matters relating to us and our financial condition.
The second part, the prospectus, gives more general information about
securities we may offer from time to time, some of which does not apply to the
common stock we are offering. Generally, when we refer to the prospectus, we
are referring to both parts of this document combined. To the extent the
description of the common stock in the prospectus supplement differs from the
description of common stock in the accompanying prospectus, you should rely on
the information in the prospectus supplement.
You should rely only on the information contained in this document or to
which this document refers you. We have not, and the underwriter has not,
authorized anyone to provide you with different information. If anyone provides
you with different or inconsistent information, you should not rely on it. This
document may only be used where it is legal to sell these securities. The
information in this document may only be accurate as of the date of this
document. Our business, financial condition, results of operations and
prospects may have changed since that date.
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WHERE YOU CAN FIND MORE INFORMATION
We file annual, quarterly and special reports, proxy statements and other
information with the SEC. Our SEC filings are available to the public over the
Internet at the SEC's web site at http://www.sec.gov. You may also read and
copy any document we file at the SEC's public reference rooms in Washington,
D.C., New York, and Chicago. Please call the SEC at 1-800-SEC-0330 for further
information on the public reference rooms. You may also read and copy these
documents at the offices of the New York Stock Exchange, 20 Broad Street, New
York, New York 10005.
The SEC allows us to "incorporate by reference" the information we file with
them, which means that we can disclose important information to you by
referring you to those documents. The information incorporated by reference is
considered to be part of this prospectus and later information that we file
with the SEC will automatically update or supersede this information. We
incorporate by reference the documents listed below and any future filings
made with the SEC under Sections 13(a), 13(c), 14, or 15(d) of the Securities
Exchange Act of 1934, as amended (the Exchange Act), until such time as all of
the securities covered by this prospectus supplement have been sold:
. Annual Report on Form 10-K and Form 10-K/A for the year ended December 31,
1999;
. Quarterly Reports on Form 10-Q for the quarters ended March 31, 2000, June
30, 2000 and September 30, 2000; and
. Current Reports on Form 8-K and Form 8-K/A, filed January 3, 2000, February
1, 2000, March 23, 2000, June 21, 2000, June 22, 2000, July 11, 2000,
September 11, 2000, October 12, 2000, November 2, 2000 and November 16,
2000.
You may request a copy of these filings, at no cost, by writing or
telephoning us at: Corporate Secretary, Dominion, 120 Tredegar Street,
Richmond, Virginia 23219, Telephone (804) 819-2000.
FORWARD LOOKING INFORMATION
We have included certain information in this document which is "forward
looking information" as defined by the Private Securities Litigation Reform
Act of 1995. Examples include discussions as to our expectations, beliefs,
plans, goals, objectives and future financial or other performance or
assumptions concerning matters discussed in this document. This information,
by its nature, involves estimates, projections, forecasts and uncertainties
that could cause actual results or outcomes to differ substantially from those
expressed.
Our business is influenced by many factors that are difficult to predict,
involve uncertainties that may materially affect actual results and are often
beyond our ability to control. We have identified a number of these factors in
our filings with the SEC, including our most recent Quarterly Report on Form
10-Q which is incorporated by reference in this prospectus, and we refer you
to those reports for further information. They include fluctuations in energy-
related commodities prices, weather conditions, capital market conditions, the
risks of operating businesses in regulated industries that are in the process
of becoming deregulated, completing the integration of Consolidated Natural
Gas Company (CNG) with the remainder of our business and completing the
divestitures of Dominion Capital, Inc. and CNG International.
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DOMINION
Dominion is a fully integrated gas and electric energy holding company
headquartered in Richmond, Virginia. As of October 31, 2000, we had
approximately $28 billion in assets.
Our primary operating segments are:
Dominion Energy--Dominion Energy manages our 19,000 megawatt portfolio of
electric power generation, our 7,600 miles of gas transmission pipeline and
a 885 billion cubic foot natural gas storage network. It also guides our
generation growth strategy and our commodity trading, marketing and risk
management activities. We currently operate generation facilities in
Virginia, West Virginia, North Carolina and Illinois.
Dominion Delivery--Dominion Delivery manages our local electric and gas
distribution systems serving 3.8 million customers, our 6,000 miles of
electric transmission lines and our customer service operations. We
currently operate transmission and distribution systems in Virginia, West
Virginia, North Carolina, Pennsylvania and Ohio. Dominion Delivery also
includes Dominion Telecom with its 3,620 route-mile fiber optic network and
related telecommunications and advanced data services located principally in
the northeast quadrant of the United States.
Dominion Exploration & Production--Dominion Exploration & Production
manages our onshore and offshore oil and gas exploration and production
activities. With approximately 2.8 trillion cubic feet of natural gas
equivalent reserves and 320 billion cubic feet of annual production,
Dominion Exploration & Production is one of the nation's largest independent
oil and gas operators. We operate on the outer continental shelf and deep
water areas of the Gulf of Mexico, western Canada, the Appalachian Basin and
other selected regions in the continental United States.
Opportunities
Dominion is operating in an industry undergoing fundamental change. We
believe that the United States energy markets are currently characterized by
increasing demand that is outpacing supply. This situation results from
increased use of energy, inadequate investment in new generation facilities and
the need to replace older power plants. Further, a new com- petitive
environment is emerging from a past characterized by cost-of-service rate
regulation and monopoly franchise territories. This situation creates
opportunities for development of new generation capacity and acquisition of
existing generation assets. We believe these opportunities will be significant
as capacity shortages persist and various industry participants seek to divest
generation assets to comply with regulatory directives and implement changing
business strategies.
We believe similar opportunities exist in our delivery and exploration and
production businesses as demand outpaces supply. Today's commodity prices
reflect the current demand for natural gas and oil and, with more than 90% of
new power plants under development planning to use natural gas for fuel, we
believe the long term fundamentals of delivery and production of natural gas
and oil will remain strong.
Changes in the energy markets also require that producers and their principal
customers manage the risks associated with
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producing and delivering energy commodities. Knowledgeable industry
participants are able to market energy commodities profitably and to manage the
risks associated with commodity market price fluctuations.
Competitive Strengths
We believe that we are well positioned in the new energy environment based on
our following competitive strengths:
Size and Scale--Our size and scale give us the critical mass needed to
provide the financial strength, flexibility and economies of scale necessary
to compete in the new energy marketplace. In addition, our size has provided
better access to capital and improved opportunities for expansion.
MAIN to Maine Focus--We are concentrating our efforts in the Midwest,
Northeast and Mid-Atlantic regions of the United States, which we call the
"MAIN to Maine" region. In the power industry, "MAIN" means the Middle
American Interconnected Network, which
comprises the states of Missouri, Illinois, Wisconsin, Michigan and Indiana.
The MAIN to Maine region is home to approximately 40% of the nation's demand
for energy. It also has some of the nation's highest energy prices and, as a
result, is rapidly moving toward industry deregulation and restructuring.
Our CNG acquisition, completed in early 2000, substantially increased our
concentration of assets and customers in the region.
Integrated Asset Base--We have the capability to discover and produce gas,
store it, sell it or use it to generate power; we can generate electricity
to sell to customers in our retail markets or in wholesale transactions.
This optionality gives us the ability to produce and sell energy in whatever
form we find most useful and economic. We also operate North America's
largest natural gas storage system, which gives us the flexibility to
provide supply when it is most economically advantageous to do so. As a
fully integrated enterprise active in all aspects of the energy supply
chain, we have the ability to optimize the value of our energy portfolio to
maximize return on invested capital.
Market Knowledge--We capitalize on our in-depth knowledge of our trading
and customer markets. Specifically, our knowledge of the energy trading
market allows us to not only manage market risks but also to maximize the
value of our energy portfolio. As our industry deregulates, we know that we
must remain focused on reliably and efficiently serving our customer base in
order to retain existing customers and add new ones.
Investor Focus--The financial interests of our employees and management
are strongly aligned with the interests of our investor base. They own more
than 16 million shares and together would be Dominion's largest shareholder.
Incentive programs in the form of stock options further align the interests
of our employees with those of our investors.
Focused Growth
Our growth strategy is focused on the MAIN to Maine region and building on the
platform provided by our current asset base.
Dominion Energy--During the period from 2000 to 2005, we plan to have
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added nearly 10,000 megawatts of generation capacity through new plants,
expanded capacity and acquisitions. As part of this plan, 1,100 megawatts of
gas-fired generation capacity are already on line. An additional 800
megawatts is under construction or in regulatory approval stages in
Virginia. We recently announced our agreement to acquire, for approximately
$1.3 billion, the 2,000 megawatt Millstone nuclear facility in Connecticut.
We have sited four new generation plants with combined capacity of
approximately 2,000 megawatts along the Dominion gas pipelines in Ohio,
Pennsylvania and West Virginia. Additional anticipated capacity expansion of
4,000 megawatts is also planned, including capacity expansions at our Elwood
facility in Illinois. To support these plans, we have acquired or have
options to acquire 45 General Electric turbines and eight steam turbines
which will be sufficient to support our 8,000 megawatts of generation
expansion.
Dominion Delivery--We expect continued growth in our distribution business
as a result of increasing our customer base and improving our operational
efficiencies through technological advances and development. In the
telecommunications market, we believe that the rapid growth in bandwidth
demand occurring in the U.S. will continue. In particular, we believe
significant opportunities for bandwidth expansion exist in smaller markets
that have not yet been targeted by the expansion strategies of the major
participants in the telecommunications industry. We have recently announced
our decision to expand Dominion Telecom in the MAIN to Maine region,
initially through acquisitions of existing fiber capacity and through joint
development projects with third parties. We have targeted expansion of our
fiber optic network to 7,000 route-miles by the end of 2001.
Dominion Exploration & Production--Over the next four years, we plan 10 to
15 percent average annual growth in BCFe production. We anticipate that this
growth will be primarily drill-bit driven from existing resources including
our offshore and Gulf Coast exploration program. Other growth will be
acquisition driven, such as our recent $85 million acquisition of operating
wells and undeveloped locations from Suemaur Exploration Partners and
others.
Because of the changes our industry is undergoing, we continue to encounter
opportunities for acquisitions of assets and business combinations that would
be consistent with our strategic principles. We regularly investigate any
opportunities we learn about that may increase shareholder value or build on
our existing asset platform. We often participate in bidding and negotiating
processes for those transactions. Any acquisitions or combinations of this type
will likely require us to access external financing sources or issue additional
equity.
As we build our geographically focused business, we are also divesting our
assets outside of the targeted MAIN to Maine region. We divested our Latin
American power generation assets to Duke Energy International for approximately
$405 million. We also recently completed the sale of CNG's Argentine operations
for $145 million to Sempra Energy International and the sale of our 80%
interest in a British power station to
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PowerGen plc for approximately $73 million. We are actively exploring the sale
of CNG's remaining international operations in Australia.
Other divestitures will also be completed as a result of regulatory
requirements imposed in connection with the CNG merger. As part of the SEC
order approving the merger under the Public Utility Holding Company Act of
1935, we are required to divest Dominion Capital. The SEC has allowed three
years for this to be accomplished. We recently agreed to sell $948 million
principal amount of commercial loans held by First Source Financial, a unit of
Dominion Capital, to GE Capital Commercial Finance. To date we have completed
the sale of approximately $730 million principal amount of these loans and
expect to complete the sale of an additional approximately $93 million
principal amount by 2001. The remaining loans were paid off in accordance with
their terms. We also sold an additional $640 million principal amount of
commercial loans held by First Source Financial through an affiliated special
purpose collateralized loan vehicle on October 11, 2000.
Also, during the merger approval process, we and CNG agreed to divest
Virginia Natural Gas, CNG's gas distribution subsidiary located in Virginia
Beach, Virginia. We completed the sale of VNG to AGL Resources, Inc. for cash
proceeds of $533 million on October 6, 2000.
Proceeds from these transactions and from the sales of non-core assets
described above are expected to raise more than $1.5 billion which will be
applied to reduce debt.
Principal Subsidiaries
Dominion's principal subsidiaries include Virginia Electric and Power Company
(Dominion Virginia Power), a regulated public utility engaged in the
generation, transmission, distribution and sale of electric energy in Virginia
and northeastern North Carolina, and CNG, a producer, transporter, distributor
and retail marketer of natural gas serving customers in Pennsylvania, Ohio,
West Virginia, New York and various cities in the Northeast and Mid-Atlantic.
Dominion's other principal subsidiaries include Dominion Energy, Inc., an
independent power and natural gas subsidiary, and Dominion Capital, Inc., its
financial services subsidiary.
In 1999, the Governor of Virginia signed into law the Virginia Electric
Utility Restructuring Act establishing a detailed plan to restructure the
electric utility industry in Virginia. The new law provides for deregulation of
generation and implementation of customer choice beginning in 2002.
The new law also requires, among other things, the functional separation of
the generation, transmission and retail distribution of incumbent electric
utilities. Virginia electric utilities are required to file their functional
separation plans with the Virginia State Corporation Commission by January 1,
2001. Dominion Virginia Power filed its functional separation plan with the
Virginia Commission on November 1, 2000. Under the plan, Dominion Virginia
Power proposes to separate its generation assets and operations from its
electric transmission and distribution assets and operations. Dominion Virginia
Power would transfer its generation assets, including its obligations under its
non-utility generation contracts, to a new company, Dominion Generation, which
would be spun off to Dominion.
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Dominion Virginia Power would retain its electric transmission and
distribution assets. Dominion Generation would supply Dominion Virginia Power
with electric power until July 1, 2007 pursuant to a power purchase agreement.
Our legal structure is not currently the same as the operating segments we
use to manage our business. The functional separation of Dominion Virginia
Power's regulated and unregulated businesses may, with regulatory approval,
provide us with the opportunity to realign, in part, our legal structure with
our operating segments.
For additional information about our company, see WHERE YOU CAN FIND MORE
INFORMATION in this prospectus supplement.
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COMMON STOCK PRICE RANGE AND DIVIDENDS
Our common stock is listed on the New York Stock Exchange under the symbol
"D." The following table sets forth the range of intra-day high and low sale
prices, as reported on the NYSE Composite Tape, and the cash dividends declared
on the common stock for the periods indicated:
<TABLE>
<CAPTION>
Price Range High Low Dividends
----------- --------- --------- ---------
<S> <C> <C> <C>
1998
First Quarter................................... $42 15/16 $39 3/8 $0.645
Second Quarter.................................. 42 1/16 37 13/16 0.645
Third Quarter................................... 44 15/16 39 5/16 0.645
Fourth Quarter.................................. 48 15/16 44 3/8 0.645
1999
First Quarter................................... $47 1/16 $36 7/8 0.645
Second Quarter.................................. 44 13/16 36 9/16 0.645
Third Quarter................................... 47 3/16 43 0.645
Fourth Quarter.................................. 49 3/8 39 1/4 0.645
2000
First Quarter................................... 43 1/8 34 13/16 0.645
Second Quarter.................................. 47 1/2 38 1/16 0.645
Third Quarter................................... 59 13/16 42 13/16 0.645
Fourth Quarter (through November 20, 2000)...... 63 11/16 50 3/4 0.645
</TABLE>
On November 20, 2000, the reported last sale price of the common stock on the
NYSE was $62 7/8 per share.
Dividends on our common stock are paid as declared by Dominion's board of
directors. On October 20, 2000 our board of directors declared a dividend of
$0.645 per share payable on December 20, 2000 to shareholders of record on
November 24, 2000. Dividends are typically paid on the 20th of March, June,
September and December. Dividends can be paid by check or electronic deposit,
or may be reinvested.
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CAPITALIZATION
The table below shows our capitalization on a consolidated basis as of
September 30, 2000. The "As Adjusted for Completed Offering" column reflects
our capitalization after giving effect to our October 12, 2000 issuance and
sale of 8,250,000 stock purchase units consisting of a common stock purchase
contract and a senior note issued by Dominion (the "Completed Offering"), and
the use of the net proceeds from the Completed Offering.
The "As Fully Adjusted" column reflects our capitalization after giving
effect to the Completed Offering, this offering of common stock, and the use of
the net proceeds from both offerings.
You should read this table along with our audited financial statements
contained in our most recent Annual Report on Form 10-K as well as the
information presented in our Quarterly Reports on Form 10-Q. See WHERE YOU CAN
FIND MORE INFORMATION in this prospectus supplement.
<TABLE>
<CAPTION>
September 30, 2000
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As Adjusted
for Completed As Fully
Actual Offering Adjusted
------- ------------- --------
(in millions)
<S> <C> <C> <C>
Short-term debt/1.........................../.. $ 3,946 $ 3,546 $ 3,192
Long-term debt, stock purchase units and
capital lease obligations..................... 11,322 11,734 11,734
Obligated mandatorily redeemable preferred
securities of subsidiary trusts............... 385 385 385
Preferred stock................................ 509 509 509
Common shareholders' equity.................... 6,686 6,667/2/ 7,021
------- ------- -------
Total capitalization........................... $22,848 $22,841 $22,841
======= ======= =======
</TABLE>
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/1/Includes securities due within one year.
/2/Reflects an adjustment of approximately $19 million representing the present
value of contract adjustment payments related to the stock purchase units.
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USE OF PROCEEDS
We intend to use the net proceeds from the sale of the shares of common stock
for general corporate purposes, including the repayment of short-term debt and
the financing of our proposed $1.3 billion acquisition of the approximately
2,000 megawatt Millstone nuclear facility which we expect to complete by April
1, 2001. Pending the closing of the Millstone acquisition we may use the
proceeds to reduce our short term debt, including commercial paper, issued in
connection with our acquisition of CNG. At October 31, 2000, the weighted
average maturity date of our approximately $1.0 billion of outstanding
commercial paper was approximately 16.97 days and the weighted average interest
rate was approximately 6.81%.
DESCRIPTION OF COMMON STOCK
This Description of Common Stock, including the description of the Virginia
Stock Corporation Act and the Articles and Bylaws, replaces and updates the
corresponding sections in the base prospectus. You should read these sections
in this prospectus supplement instead of the corresponding sections in the base
prospectus.
Outstanding Shares
As of October 31, 2000, our authorized capital stock was 520,000,000 shares.
Those shares consisted of: (a) 20,000,000 shares of preferred stock, none of
which were outstanding; and (b) 500,000,000 shares of common stock, of which
239,133,620 shares were outstanding. No holder of shares of common stock or
preferred stock has any preemptive rights.
Listing
Our outstanding shares of common stock are listed on the New York Stock
Exchange under the symbol "D." The shares of common stock offered hereby and
any additional common stock we issue will also be listed on the NYSE.
Dividends
Common shareholders may receive dividends when declared by the Board of
Directors. Dividends may be paid in cash, stock or other form. In certain
cases, common shareholders may not receive dividends until we have satisfied
our obligations to any preferred shareholders. Under certain circumstances, the
Subordinated Indenture (as defined in the prospectus) also restricts our
ability to pay cash dividends.
Fully Paid
All outstanding shares of common stock are fully paid and non-assessable. Any
additional common stock we issue will also be fully paid and non-assessable.
Voting Rights
Each share of common stock is entitled to one vote in the election of
directors and other matters. Common shareholders are not entitled to cumulative
voting rights.
Other Rights
We will notify common shareholders of any shareholders' meetings according to
applicable law. If we liquidate, dissolve or wind up our business, either
voluntarily or not, common shareholders will share equally in the assets
remaining after we pay our creditors and preferred shareholders.
Transfer Agents and Registrars
We, along with Continental Stock Transfer & Trust Company, are transfer
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agent and registrar. You may contact us at the address listed on page S-3 or
Continental Stock Transfer & Trust Company located in New York, New York.
Virginia Stock Corporation Act and the Articles and the Bylaws
General
We are a Virginia corporation subject to the Virginia Stock Corporation Act
(the Virginia Act). Provisions of the Virginia Act, in addition to provisions
of our Articles of Incorporation and Bylaws, address corporate governance
issues, including the rights of shareholders. Some of these provisions could
hinder management changes while others could have an anti-takeover effect. This
anti-takeover effect may, in some circumstances, reduce the control premium
that might otherwise be reflected in the value of our common stock. If you are
buying this stock as part of a short-term investment strategy, this might be
especially important to you.
We have summarized the key provisions below. You should read the actual
provisions of our Articles and Bylaws and the Virginia Act that relate to your
individual investment strategy.
Business Combinations
Our Articles require that any merger, share exchange or sale of substantially
all of the assets of the company be approved by a plurality of the shares
represented at a meeting where a quorum is present. Abstentions and broker non-
votes have the same effect as a vote against the matter.
Section 13.1-725 of the Virginia Act contains several provisions relating to
transactions with interested shareholders. Interested shareholders are holders
of more than 10% of any class of a corporation's outstanding voting shares.
Transactions between a corporation and an interested shareholder are referred
to as affiliated transactions. The Virginia Act requires that material
affiliated transactions must be approved by at least two-thirds of the
shareholders not including the interested shareholder. Affiliated transactions
requiring this two-thirds approval include mergers, share exchanges, material
dispositions of corporate assets, dissolution or any reclassification of the
corporation with its subsidiaries which increases the percentage of voting
shares owned by an interested shareholder by more than five percent.
For three years following the time that a shareholder becomes an interested
shareholder, a Virginia corporation cannot engage in an affiliated transaction
with the interested shareholder without approval of two-thirds of the
disinterested voting shares, and majority approval of disinterested directors.
A disinterested director is a director who was a director on the date on which
an interested shareholder became an interested shareholder and was recommended
for election or elected by a majority of the disinterested directors then on
the board. After three years, the approval of the disinterested directors is no
longer required.
The provisions of the Virginia Act relating to affiliated transactions do not
apply if a majority of disinterested directors approve the acquisition of
shares making a person an interested shareholder.
The Virginia Act permits corporations to opt out of the affiliated
transactions provisions. We have not opted out.
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The Virginia Act also contains provisions regulating certain control share
acquisitions, which are transactions causing the voting strength of any person
acquiring beneficial ownership of shares of a public corporation in Virginia to
meet or exceed certain threshold voting percentages (20%, 33 1/3%, or 50%).
Shares acquired in a control share acquisition have no voting rights unless the
voting rights are granted by a majority vote of all outstanding shares other
than those held by the acquiring person or any officer or employee-director of
the corporation. The acquiring person may require that a special meeting of the
shareholders be held to consider the grant of voting rights to the shares
acquired in the control share acquisition.
Our Bylaws give us the right to redeem the shares purchased by an acquiring
person in a control share acquisition. We can do this if the acquiring person
fails to deliver a statement to us listing information required by the Virginia
Act or if our shareholders vote not to grant voting rights to the acquiring
person.
The Virginia Act permits corporations to opt out of the control share
acquisition provisions. We have not opted out.
Directors' Duties
The standards of conduct for directors of Virginia corporations are listed in
Section 13.1-690 of the Virginia Act. Directors must discharge their duties in
accordance with their good faith business judgement of the best interest of the
corporation. Directors may rely on the advice or acts of others, including
officers, employees, attorneys, accountants and board committees if they have a
good faith belief in their competence. Directors' actions are not subject to a
reasonableness or prudent person standard. Virginia's federal and state courts
have focused on the process involved with directors' decision-making and are
generally supportive of directors if they have based their decision on an
informed process. These elements of Virginia law could make it more difficult
to take over a Virginia corporation than corporations in other states.
Board of Directors
Members of our Board of Directors serve one-year terms and are elected
annually.
Shareholder Proposals and Director Nominations
Our shareholders can submit shareholder proposals and nominate candidates for
the Board of Directors if the shareholders follow advance notice procedures
described in our Bylaws.
To nominate directors, shareholders must submit a written notice to our
corporate secretary at least 60 days before a scheduled meeting. The notice
must include the name and address of the shareholder and of the nominee, a
description of any arrangements between the shareholder and the nominee,
information about the nominee required by the SEC, the written consent of the
nominee to serve as a director and other information.
Shareholder proposals must be submitted to our corporate secretary at least
90 days before the first anniversary of the date of our last annual meeting.
The notice must include a description of the proposal, the reasons for
presenting the proposal at the annual meeting, the text of any resolutions to
be presented, the shareholder's name and address and number of shares held and
any material interest of the shareholder in the proposal.
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Director nominations and shareholder proposals that are late or that do not
include all required information may be rejected. This could prevent
shareholders from bringing certain matters before an annual or special meeting,
including making nominations for directors.
Meetings of Shareholders
Under our Bylaws, meetings of the shareholders may be called only by the
chairman of the board, the president or a majority of the Board of Directors.
This provision could have the effect of delaying until the next annual
shareholders' meeting shareholder actions which are favored by the holders of a
majority of our outstanding voting securities, because such person or entity,
even if it acquired a majority of our outstanding voting securities, would be
able to take action as a shareholder, such as electing new directors or
approving a merger, only at a duly called shareholders' meeting.
Amendment of Articles
Generally, our Articles may be amended by a majority of the votes present by
each voting group entitled to vote on a given matter. Some provisions of the
Articles, however, may only be amended or repealed by a vote of at least two-
thirds of the outstanding shares entitled to vote.
Indemnification
We indemnify our officers and directors to the fullest extent permitted under
Virginia law against all liabilities incurred in connection with their service
to us.
Limitation of Liability
Our Articles provide that our directors and officers will not be personally
liable for monetary damages to us for breaches of their fiduciary duty as
directors or officers, unless they violated their duty of loyalty to us or our
shareholders, acted in bad faith, knowingly or intentionally violated the law,
authorized illegal dividends or redemptions or derived an improper personal
benefit from their action as directors or officers. This provision applies only
to claims against directors or officers arising out of their role as directors
or officers and not in any other capacity. Directors and officers remain liable
for violations of the federal securities laws and we retain the right to pursue
legal remedies other than monetary damages, such as an injunction or rescission
for breach of the officer's or director's duty of care.
UNDERWRITING
Under the terms and subject to the conditions contained in a purchase
agreement dated November 21, 2000, we have agreed to sell to Merrill Lynch,
Pierce, Fenner & Smith Incorporated (the Underwriter) and the Underwriter has
agreed to purchase from us 6,000,000 shares of common stock.
The purchase agreement provides that the Underwriter is obligated to purchase
all the shares of common stock in the offering if any are purchased.
The Underwriter has agreed to purchase the shares of common stock offered
hereby for a purchase price of $59.07 per share. The proceeds to Dominion from
the sale of the shares of common stock will be $354,420,000.
We estimate that our out of pocket expenses for this offering will be
approximately $200,000.
The distribution of the shares of common stock by the Underwriter may be
effected
S-14
<PAGE>
from time to time to purchasers directly or through agents, or through brokers
in brokerage transactions on the New York Stock Exchange, or to dealers in
negotiated transactions or in a combination of such methods of sale, at a fixed
price or prices, which may be changed, or at market prices prevailing at the
time of sale, at prices related to such prevailing market prices or at
negotiated prices. In connection with the sale of any shares of common stock
hereby, the Underwriter may be deemed to have received compensation from
Dominion equal to the difference between the amount received by the Underwriter
upon the sale of such common stock and the price at which the Underwriter
purchased such common stock from Dominion. In addition, if the Underwriter
sells common stock to or through certain dealers, such dealers may receive
compensation in the form of underwriting discounts, concessions or commissions
from the Underwriter and/or any purchasers of common stock for whom they may
act as agent. The Underwriter may also receive compensation from the purchasers
of common stock for whom it may act as agent.
The shares of common stock are being offered by the Underwriter, subject to
prior sale, when, as and if issued to and accepted by it, subject to approval
of certain legal matters by counsel for the Underwriter and certain other
conditions. The Underwriter reserves the right to withdraw, cancel or modify
such offer and to reject orders in whole or in part.
We have agreed to indemnify the Underwriter against liabilities under the
Securities Act, or contribute to payments that the Underwriter may be required
to make in that respect.
Dominion and our executive officers and directors have agreed, subject to
limited exceptions, without the prior written consent of the Underwriter,
during the period ending 90 days after the date of this prospectus supplement,
not to directly or indirectly:
. offer, pledge, sell, contract to sell, sell any option or contract to
purchase, purchase any option or contract to sell, grant any option, right
or warrant to purchase, lend or otherwise transfer or dispose of any
shares of common stock or any securities convertible into or exercisable
or exchangeable for common stock, or file any registration statement under
the Securities Act with respect to any of the above; or
.enter into any swap or other arrangement that transfers to another, in
whole or in part, any of the economic consequences of ownership of common
stock, whether any such transaction described above is to be settled by
delivery of common stock or such other securities, in cash or otherwise.
These restrictions do not apply to:
.the sale of the shares of common stock to the Underwriter;
.the issuance by Dominion of any shares of common stock upon the exercise of
an option or warrant, or the conversion of a security outstanding on the
date of this prospectus supplement;
. the creation or recreation of Dominion's stock purchase units or the
issuance of shares of common stock upon early settlement of Dominion's
stock purchase units.
S-15
<PAGE>
.the issuance by Dominion of shares of common stock, or options to purchase
any shares of common stock granted, in connection with our employee
benefit plans, employee share purchase plans, non-employee director stock
plans, dividend reinvestment plans and the Dominion Direct Investment
plan;
.the sale or surrender to Dominion by any of our executive officers or
directors of any options or shares of common stock underlying options in
order to pay the exercise price or taxes associated with the exercise of
options;
.the issuance by us of shares of common stock in connection with
acquisitions that close more than 90 days after this offering or any
acquisition in which the party receiving the shares of common stock agrees
to be bound by such restrictions;
.transactions by any person other than Dominion relating to shares of common
stock or other securities acquired in open market transactions after the
completion of the offering of the shares of common stock;
.transfers by any person, other than Dominion, by gift, will or intestacy,
or to affiliates or immediate family members, provided that the transferee
agrees to be bound by such restriction; or
.the filing by Dominion of a shelf registration statement from which
Dominion will not offer any such securities during the 90-day period.
Until the distribution of the shares is completed, rules of the Securities
and Exchange Commission may limit the ability of the Underwriter to bid for and
purchase our common stock. If the Underwriter creates a short position in our
common stock in connection with the offering (i.e., if it sells more shares of
common stock than are set forth on the cover page of this prospectus
supplement), the Underwriter may reduce that short position by purchasing
common stock in the open market. In general, purchases of a security to reduce
a short position could cause the price of the security to be higher than it
might be in the absence of such purchases.
Neither we nor the Underwriter makes any representation or prediction as to
the direction or magnitude of any effect that the transactions described above
may have on the price of the common stock. In addition, neither we nor the
Underwriter makes any representation that the Underwriter will engage in such
transactions or that such transactions, once commenced, will not be
discontinued without notice.
Merrill Lynch has from time to time provided investment or commercial banking
services to us in the past and is likely to do so in the future. It receives
customary fees and commissions for these services.
LEGAL OPINIONS
Certain legal matters in connection with the offering of the common stock
will be passed upon for Dominion by McGuireWoods LLP, and for the Underwriter
by Mays & Valentine, L.L.P., who also perform certain legal services for us on
other matters.
S-16
<PAGE>
Prospectus
DOMINION RESOURCES, INC.
120 Tredegar Street
Richmond, Virginia 23219
(804) 819-2000
$950,000,000
Debt Securities
Preferred Stock
Common Stock
-------------------------------------------------------------------
We will provide specific terms of these securities in supplements to this
prospectus.
You should read this prospectus and any supplement carefully before you invest.
-------------------------------------------------------------------
These securities have not been approved by the SEC or any state securities
commission, nor have these organizations determined that this prospectus is
accurate or complete. Any representation to the contrary is a criminal offense.
This prospectus is dated September 17, 1997.
<PAGE>
ABOUT THIS PROSPECTUS
This prospectus is part of a registration statement that we filed with the
SEC utilizing a "shelf" registration process. Under this shelf process, we may,
over the next two years, sell any combination of the securities described in
this prospectus in one or more offerings up to a total dollar amount of
$950,000,000. This prospectus provides you with a general description of the
securities we may offer. Each time we sell securities, we will provide a
prospectus supplement that will contain specific information about the terms of
that offering. The prospectus supplement may also add, update or change
information contained in this prospectus. You should read both this prospectus
and any prospectus supplement together with additional information described
under the heading WHERE YOU CAN FIND MORE INFORMATION.
We are participating in the SEC's plain English program. This is an
initiative launched by the SEC to make prospectuses and other information more
understandable to the general investor. To see more detail, you should read the
exhibits filed with this registration statement.
WHERE YOU CAN FIND MORE INFORMATION
We file annual, quarterly and special reports, proxy statements and other
information with the SEC. Our SEC filings are available to the public over the
Internet at the SEC's web site at http://www.sec.gov. You may also read and
copy any document we file at the SEC's public reference rooms in Washington,
D.C., New York, New York and Chicago, Illinois. Please call the SEC at 1-800-
SEC-0330 for further information on the public reference rooms.
The SEC allows us to "incorporate by reference" the information we file with
them, which means that we can disclose important information to you by
referring you to those documents. The information incorporated by reference is
an important part of this prospectus, and information that we file later with
the SEC will automatically update and supersede this information. We
incorporate by reference the documents listed below and any future filings made
with the SEC under Sections 13(a), 13(c), 14, or 15(d) of the Securities
Exchange Act of 1934 until we sell all of the securities.
. Annual Report on Form 10-K for the year ended December 31, 1996;
. Quarterly Reports on Form 10-Q for the quarters ended March 31, 1997 and June
30, 1997;
. Current Reports on Form 8-K, filed January 23, 1997 and Form 8-K/A, filed
March 20, 1997; and
. The description of the Company's common stock contained in Form 8-B (Item 4)
dated April 29, 1983.
You may request a copy of these filings at no cost, by writing or telephoning
us at the following address:
Corporate Secretary
Dominion
120 Tredegar Street
Richmond, Virginia 23219
(804) 819-2000
You should rely only on the information incorporated by reference or provided
in this prospectus or any prospectus supplement. We have not authorized anyone
else to provide you with different information. We are not making
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<PAGE>
an offer of these securities in any state where the offer is not permitted.
You should not assume that the information in this prospectus or any
prospectus supplement is accurate as of any date other than the date on the
front of those documents.
THE COMPANY
Dominion Resources, Inc. is a holding company headquartered in Richmond,
Virginia. Our operating subsidiaries are:
. Virginia Power/North Carolina Power, principally an electric utility serving
two million residences and businesses in a 30,000-square-mile region from
northern Virginia to northeastern North Carolina. It owns and operates
nuclear, coal, natural gas, oil and hydroelectric power stations;
. Dominion Energy, Inc., an independent power and natural gas subsidiary. It
has ownership and operating interests in 27 generating facilities in six
U.S. states, Argentina, Belize, Bolivia and Peru. This company has about 460
billion cubic feet of proven natural gas reserves throughout several major
regions of the United States;
. Dominion Capital, Inc., a financial services and real estate subsidiary,
with commercial and mortgage lending entities, a full-service commercial
real estate company, a large hydroelectric station in Louisiana, and a
variety of debt and equity investments; and
. East Midlands Electricity plc, principally an electric power distribution
and supply company serving 2.3 million homes and businesses in the East
Midlands region of the United Kingdom.
USE OF PROCEEDS
The net proceeds from the sale of the offered securities will be used for
general corporate purposes including repayment of debt. This debt may include
approximately $910 million incurred in connection with the purchase of East
Midlands in early 1997.
RATIO OF EARNINGS TO FIXED CHARGES
The ratio of earnings to fixed charges for each of the periods indicated is
as follows:
<TABLE>
<CAPTION>
Twelve
Months
ended Twelve Months ended Dec.
June 31,
30, --------------------------
1997 1996 1995 1994 1993 1992
------ ----- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C>
2.38 2.75 2.56 2.77 2.90 2.69
</TABLE>
These computations include us and our subsidiaries, and 50% or less equity
companies. For these ratios, "earnings" is determined by adding "total fixed
charges" (excluding interest capitalized), income taxes, minority common
stockholders equity in net income and amortization of interest capitalized to
income from continuing operations after eliminating equity in undistributed
earnings and adding back losses of companies in which at least 20% but less
than 50% equity is owned. For this purpose, "total fixed charges" consists of
(1) interest on all indebtedness and amortization of debt discount and
expense, (2) interest capitalized and (3) an interest factor attributable to
rentals.
DESCRIPTION OF DEBT SECURITIES
The Debt Securities will be our direct unsecured general obligations. The
Debt Securities will be either senior debt securities or subordinated debt
securities. The Debt Securities will be issued under one or more separate
indentures between us
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<PAGE>
and The Chase Manhattan Bank as Trustee. Senior Debt Securities will be issued
under a "Senior Indenture" and Subordinated Debt Securities will be issued
under a "Subordinated Indenture". Together the Senior Indentures and the
Subordinated Indentures are called "Indentures".
We have summarized selected provisions of the Indentures below. The summary
is not complete. The forms of the Indentures have been filed as exhibits to the
registration statement and you should read the Indentures for provisions that
may be important to you. In the summary below, we have included references to
section numbers of the applicable Indentures so that you can easily locate
these provisions. Capitalized terms used in the summary have the meanings
specified in the Indentures.
General
The Debt Securities will be our direct, unsecured obligations. The Senior
Debt Securities will rank equally with all of our other senior and
unsubordinated debt. The Subordinated Debt Securities will have a junior
position to all of our Senior Debt.
Because we are a holding company that conducts all of our operations through
our subsidiaries, holders of Debt Securities will generally have a junior
position to claims of creditors of our subsidiaries, including trade creditors,
debtholders, secured creditors, taxing authorities, guarantee holders and any
preferred stockholders. Virginia Power has 6,890,140 outstanding shares of
preferred stock. All of our operating subsidiaries have ongoing corporate debt
programs used to finance their business activities. As of June 30, 1997, our
subsidiaries had approximately $7.8 billion of outstanding debt.
A prospectus supplement and a supplemental indenture relating to any series
of Debt Securities being offered will include specific terms relating to the
offering. These terms will include some or all of the following:
. The title and type of the Debt Securities;
. The total principal amount of the Debt Securities;
. The percentage of the principal amount at which the Debt Securities will be
issued and any payments due if the maturity of the Debt Securities is
accelerated;
. The dates on which the principal of the Debt Securities will be payable;
. The interest rate which the Debt Securities will bear and the interest
payment dates for the Debt Securities;
. Any optional redemption periods;
. Any sinking fund or other provisions that would obligate us to repurchase or
otherwise redeem the Debt Securities;
. Any provisions granting special rights to holders when a specified event
occurs;
. Any changes to or additional Events of Defaults or covenants;
. Any special tax implications of the Debt Securities, including provisions for
Original Issue Discount Securities, if offered; and
. Any other terms of the Debt Securities.
None of the Indentures limits the amount of Debt Securities that may be
issued. Each Indenture allows Debt Securities to be issued up to the principal
amount that may be authorized by us and may be in any currency or currency unit
designated by us.
Debt Securities of a series may be issued in registered, bearer, coupon or
global form. (Sections 201 & 203.)
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<PAGE>
Denominations
The prospectus supplement for each issuance of Debt Securities will state
whether the securities will be issued in registered form of $1,000 each or
multiples thereof or bearer form of $5,000 each.
Subordination
Under the Subordinated Indenture, payment of the principal, interest and any
premium on the Subordinated Debt Securities will generally be subordinated and
junior in right of payment to the prior payment in full of all Senior Debt. The
Subordinated Indenture provides that no payment of principal, interest and any
premium on the Subordinated Debt Securities may be made in the event:
. of any insolvency, bankruptcy or similar proceeding involving the Company or
our property, or
. we fail to pay the principal, interest, any premium or any other amounts on
any Senior Debt when due.
The Subordinated Indenture will not limit the amount of Senior Debt that we
may incur.
"Senior Debt" is defined to include all notes or other unsecured evidences of
indebtedness including guarantees of the Company for money borrowed by the
Company, not expressed to be subordinate or junior in right of payment to any
other indebtedness of the Company.
Consolidation, Merger or Sale
Each Indenture generally permits a consolidation or merger between us and
another corporation. They also permit the sale by us of all or substantially
all of our property and assets. If this happens, the remaining or acquiring
corporation shall assume all of our responsibilities and liabilities under the
Indentures including the payment of all amounts due on the Debt Securities and
performance of the covenants in the Indentures.
However, we will only consolidate or merge with or into any other corporation
or sell all or substantially all of our assets according to the terms and
conditions of the Indentures. The remaining or acquiring corporation will be
substituted for us in the Indentures with the same effect as if it had been an
original party to the Indenture. Thereafter, the successor corporation may
exercise our rights and powers under any Indenture, in our name or in its own
name. Any act or proceeding required or permitted to be done by our Board of
Directors or any of our officers may be done by the board or officers of the
successor corporation. If we sell all or substantially all of our assets, we
shall be released from all our liabilities and obligations under any Indenture
and under the Debt Securities. (Sections 801& 802.)
Modification of Indentures
Under each Indenture our rights and obligations and the rights of the holders
may be modified with the consent of the holders of a majority in aggregate
principal amount of the outstanding Debt Securities of each series affected by
the modification. No modification of the principal or interest payment terms,
and no modification reducing the percentage required for modifications, is
effective against any holder without its consent. (Sections 901 & 902.)
Events of Default
"Event of Default" when used in an Indenture, will mean any of the following:
. failure to pay the principal or any premium on any Debt Security when due;
5
<PAGE>
. failure to deposit any sinking fund payment when due;
. failure to pay interest on any Debt Security for 30 days;
. failure to perform any other covenant in the Indenture that continues for 90
days after being given written notice;
. certain events in bankruptcy, insolvency or reorganization of the Company; or
. any other Event of Default included in any Indenture or supplemental
indenture. (Section 501.)
An Event of Default for a particular series of Debt Securities does not
necessarily constitute an Event of Default for any other series of Debt
Securities issued under an Indenture. The Trustee may withhold notice to the
holders of Debt Securities of any default (except in the payment of principal
or interest) if it considers such withholding of notice to be in the best
interests of the holders. (Section 602.)
If an Event of Default for any series of Debt Securities occurs and
continues, the Trustee or the holders of at least 25% in aggregate principal
amount of the Debt Securities of the series may declare the entire principal of
all the Debt Securities of that series to be due and payable immediately. If
this happens, subject to certain conditions, the holders of a majority of the
aggregate principal amount of the Debt Securities of that series can void the
declaration. (Section 502.)
Other than its duties in case of a default, a Trustee is not obligated to
exercise any of its rights or powers under any Indenture at the request, order
or direction of any holders, unless the holders offer the Trustee reasonable
indemnity. (Section 601.) If they provide this reasonable indemnification, the
holders of a majority in principal amount of any series of Debt Securities may
direct the time, method and place of conducting any proceeding or any remedy
available to the Trustee, or exercising any power conferred upon the Trustee,
for any series of Debt Securities. (Section 512.)
Covenants
Under the Indentures, we will:
. pay the principal, interest and any premium on the Debt Securities when due;
. maintain a place of payment;
. deliver a report to the Trustee at the end of each fiscal year reviewing the
Company's obligations under the Indentures; and
. deposit sufficient funds with any paying agent on or before the due date for
any principal, interest or any premium.
Payment and Transfer
Principal, interest and any premium on fully registered securities will be
paid at designated places. Payment will be made by check mailed to the persons
in whose names the Debt Securities are registered on days specified in the
Indentures or any prospectus supplement. Debt Securities payments in other
forms will be paid at a place designated by us and specified in a prospectus
supplement. (Section 307.)
Fully registered securities may be transferred or exchanged at the corporate
trust office of the Trustee or at any other office or agency maintained by us
for such purposes, without the payment of any service charge except for any tax
or governmental charge. (Section 1002.)
6
<PAGE>
Global Securities
The Debt Securities of a series may be issued in whole or in part in the form
of one or more global certificates that will be deposited with a depositary
identified in a prospectus supplement. Unless it is exchanged in whole or in
part for Debt Securities in definitive form, a global certificate may generally
be transferred only as a whole unless it is being transferred to certain
nominees of the depositary. (Section 203.)
Unless otherwise stated in any prospectus supplement, The Depository Trust
Company, New York, New York ("DTC") will act as depositary. Beneficial
interests in global certificates will be shown on, and transfers of global
certificates will be effected only through, records maintained by DTC and its
participants.
Defeasance
We will be discharged from our obligations on the Debt Securities of any
series at any time if we deposit with the Trustee sufficient cash or government
securities to pay the principal, interest, any premium and any other sums due
to the stated maturity date or a redemption date of the Debt Securities of the
series. If this happens, the holders of the Debt Securities of the series will
not be entitled to the benefits of the Indenture except for registration of
transfer and exchange of Debt Securities and replacement of lost, stolen or
mutilated Debt Securities. (Section 401.)
Under Federal income tax law as of the date of this prospectus, a discharge
may be treated as an exchange of the related Debt Securities. Each holder might
be required to recognize gain or loss equal to the difference between the
holder's cost or other tax basis for the Debt Securities and the value of the
holder's interest in the trust. Holders might be required to include as income
a different amount than would be includable without the discharge. Prospective
investors are urged to consult their own tax advisers as to the consequences of
a discharge, including the applicability and effect of tax laws other than the
Federal income tax law.
DESCRIPTION OF CAPITAL STOCK
As of June 30, 1997, our authorized capital stock was 320,000,000 shares.
Those shares consisted of: (a) 20,000,000 shares of preferred stock, none of
which were outstanding; and (b) 300,000,000 shares of common stock, of which
185,604,273 shares were outstanding.
Common Stock
Listing
Our outstanding shares of common stock are listed on the New York Stock
Exchange under the symbol "D". Any additional common stock we issue will also
be listed on the NYSE.
Dividends
Common shareholders may receive dividends when declared by the Board of
Directors. Dividends may be paid in cash, stock or other form. In certain
cases, common shareholders may not receive dividends until we have satisfied
our obligations to any preferred shareholders.
Fully Paid
All outstanding shares of common stock are fully paid and non-assessable. Any
additional common stock we issue will also be fully paid and non-assessable.
7
<PAGE>
Voting Rights
Each share of common stock is entitled to one vote in the election of
directors and other matters. Common shareholders are not entitled to preemptive
or cumulative voting rights.
Other Rights
We will notify common shareholders of any shareholders' meetings according to
applicable law. If we liquidate, dissolve or wind-up our business, either
voluntarily or not, common shareholders will share equally in the assets
remaining after we pay our creditors and preferred shareholders.
Transfer Agents and Registrars
We, along with Chase Mellon Shareholder Services, are transfer agent and
registrar. You may contact us at the address listed on page 2 or Chase Mellon
located in Ridgefield, New Jersey.
Preferred Stock
The following description of the terms of the preferred stock sets forth
certain general terms and provisions of our authorized preferred stock. If we
offer preferred stock, the specific designations and rights will be described
in the prospectus supplement and a description will be filed with the SEC.
Our Board of Directors can, without approval of shareholders, issue one or
more series of preferred stock. The Board can also determine the number of
shares of each series and the rights, preferences and limitations of each
series including the dividend rights, voting rights, conversion rights,
redemption rights and any liquidation preferences of any wholly unissued series
of preferred stock, the number of shares constituting each series and the terms
and conditions of issue. In some cases, the issuance of preferred stock could
delay a change in control of the Company and make it harder to remove present
management. Under certain circumstances, preferred stock could also restrict
dividend payments to holders of our common stock.
The preferred stock will, when issued, be fully paid and non-assessable.
The transfer agent, registrar, and dividend disbursement agent for a series
of preferred stock will be named in a prospectus supplement. The registrar for
shares of preferred stock will send notices to shareholders of any meetings at
which holders of the preferred stock have the right to elect directors or to
vote on any other matter.
VIRGINIA STOCK CORPORATION ACT AND THE ARTICLES AND THE BYLAWS
General
We are a Virginia corporation subject to the Virginia Stock Corporation Act
(the "Virginia Act"). Provisions of the Virginia Act, in addition to provisions
of our Articles of Incorporation and Bylaws, address corporate governance
issues, including the rights of shareholders. Some of these provisions could
hinder management changes while others could have an anti-takeover effect. This
anti-takeover effect may, in some circumstances, reduce the control premium
that might otherwise be reflected in the value of our common stock. If you are
buying this stock as part of a short-term investment strategy, this might be
especially important to you.
We have summarized the key provisions below. The descriptions are not
complete.
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<PAGE>
You should read the actual provisions of our Articles and Bylaws and the
Virginia Act that relate to your individual investment strategy.
Business Combinations
The Virginia Act and our Articles generally require that any merger, share
exchange or sale of substantially all of the assets of a corporation be
approved by at least two-thirds of the votes entitled to be cast by each voting
group entitled to vote.
Section 13.1-725 of the Virginia Act contains several provisions relating to
transactions with "interested shareholders." Interested Shareholders are
holders of more than 10% of any class of a corporation's outstanding voting
shares. Transactions between a corporation and an Interested Shareholder are
referred to as Affiliated Transactions. The Virginia Act requires that material
affiliated transactions must be approved by at least two-thirds of the
shareholders not including the Interested Shareholder. Affiliated Transactions
requiring this two-thirds approval include mergers, share exchanges, material
dispositions of corporate assets, dissolution or any reclassification of the
corporation with its subsidiaries which increases the percentage of voting
shares owned by an Interested Shareholder by more than five percent.
For three years following the time that a shareholder becomes an Interested
Shareholder, a Virginia corporation cannot engage in an Affiliated Transaction
with the Interested Shareholder without approval of two-thirds of the
disinterested voting shares, and majority approval of "Disinterested
Directors." A Disinterested Director is a director who was a director on the
date on which an Interested Shareholder became an Interested Shareholder and
was recommended for election or elected by a majority of the Disinterested
Directors then on the board. After three years, the approval of the
Disinterested Directors is no longer required.
The provisions of the Virginia Act relating to Affiliated Transactions do not
apply if a majority of Disinterested Directors approve the acquisition of
shares making a person an Interested Shareholder.
The Virginia Act permits corporations to opt out of the Affiliated
Transactions provisions. We have not opted out.
The Virginia Act also contains provisions regulating certain "control share
acquisitions," which are transactions causing the voting strength of any person
acquiring beneficial ownership of shares of a public corporation in Virginia to
meet or exceed certain threshold voting percentages (20%, 33 1/3% or 50%).
Shares acquired in a control share acquisition have no voting rights unless the
voting rights are granted by a majority vote of all outstanding shares other
than those held by the acquiring person or any officer or employee-director of
the corporation. The acquiring person may require that a special meeting of the
shareholders be held to consider the grant of voting rights to the shares
acquired in the control share acquisition.
Our Bylaws give us the right to redeem the shares purchased by an acquiring
person in a control share acquisition. We can do this if the acquiring person
fails to deliver a statement to us listing information required by the Virginia
Act or if our shareholders vote not to grant voting rights to the acquiring
person.
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The Virginia Act permits corporations to opt out of the control share
acquisition provisions. We have not opted out.
Directors' Duties
The standards of conduct for directors of Virginia corporations are listed in
Section 13.1-690 of the Virginia Act. Directors must discharge their duties in
accordance with their "good faith business judgement of the best interest of
the corporation". Directors may rely on the advice or acts of others, including
officers, employees, attorneys, accountants and board committees if they have a
good faith belief in their competence. Directors' actions are not subject to a
"reasonableness" or "prudent person" standard. Virginia's Federal courts have
focused on the process involved with directors' decision-making and are
generally supportive of directors if they have based their decision on an
informed process. These elements of Virginia law could make it more difficult
to take over a Virginia corporation than corporations in other states.
Board of Directors
Members of our Board of Directors serve staggered three year terms. This
means that only one-third of our directors are elected each year.
Shareholder Proposals and Director Nominations
Our shareholders can submit shareholder proposals and nominate candidates for
the Board of Directors if the shareholders follow advance notice procedures
described in our Bylaws.
To nominate directors, shareholders must submit a written notice to our
corporate secretary at least 60 days before a scheduled meeting. The notice
must include the name and address of the shareholder and of the nominee, a
description of any arrangements between the shareholder and the nominee,
information about the nominee required by the SEC, the written consent of the
nominee to serve as a director and other information.
Shareholder proposals must be submitted to our corporate secretary at least
90 days before the first anniversary of the date of our last annual meeting.
The notice must include a description of the proposal, the reasons for
presenting the proposal at the annual meeting, the text of any resolutions to
be presented, the shareholder's name and address and number of shares held and
any material interest of the shareholder in the proposal.
Director nominations and shareholder proposals that are late or that do not
include all required information may be rejected. This could prevent
shareholders from bringing certain matters before an annual or special meeting,
including making nominations for directors.
Meetings of Shareholders
Under our Bylaws, meetings of the shareholders may be called only by the
chairman of the board, the president or a majority of the Board of Directors.
This provision could have the effect of delaying until the next annual
shareholders' meeting shareholder actions which are favored by the holders of a
majority of our outstanding voting securities, because such person or entity,
even if it acquired a majority of the outstanding voting securities of Dominion
Resources, would be able to take action as a shareholder, such as electing new
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directors or approving a merger, only at a duly called shareholders' meeting.
Amendment of Articles and Bylaws
Generally, our Articles may be amended by a majority of the outstanding votes
entitled to be cast by each voting group entitled to vote on a given matter.
Some provisions of the Articles, however, may only be amended or repealed by
two-thirds of the votes entitled to be cast by each voting group entitled to
vote.
Indemnification
We indemnify our officers and directors to the fullest extent permitted under
Virginia law against all liabilities incurred in connection with their service
to us.
Limitation of Liability
Our Articles provide that our directors will not be personally liable for
monetary damages to us for breaches of their fiduciary duty as directors,
unless they violated their duty of loyalty to us or our stockholders, acted in
bad faith, knowingly or intentionally violated the law, authorized illegal
dividends or redemptions or derived an improper personal benefit from their
action as directors. This provision applies only to claims against directors
arising out of their role as directors and not in any other capacity (such as
an officer or employee). Directors remain liable for violations of the federal
securities laws and we retain the right to pursue legal remedies other than
monetary damages, such as an injunction or rescission for breach of the
director's duty of care.
PLAN OF DISTRIBUTION
We may sell the offered securities (a) through agents; (b) through
underwriters or dealers; or (c) directly to one or more purchasers.
By Agents
Offered securities may be sold through agents designated by us. The agents
agree to use their reasonable best efforts to solicit purchases for the period
of their appointment.
By Underwriters
If underwriters are used in the sale, the offered securities will be acquired
by the underwriters for their own account. The underwriters may resell the
securities in one or more transactions, including negotiated transactions, at a
fixed public offering price or at varying prices determined at the time of
sale. The obligations of the underwriters to purchase the securities will be
subject to certain conditions. The underwriters will be obligated to purchase
all the securities of the series offered if any of the securities are
purchased. Any initial public offering price and any discounts or concessions
allowed or re-allowed or paid to dealers may be changed from time to time.
Direct Sales
Offered securities may also be sold directly by us. In this case, no
underwriters or agents would be involved.
General Information
Underwriters, dealers and agents that participate in the distribution of the
offered securities may be underwriters as defined in the Securities Act of 1933
(the "Act"), and any discounts or commissions received by them from us and any
profit on the resale of the offered securities by them may be treated as
underwriting discounts and commissions under the Act. Any
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underwriters or agents will be identified and their compensation described in a
prospectus supplement.
We may have agreements with the underwriters, dealers and agents to indemnify
them against certain civil liabilities, including liabilities under the Act, or
to contribute with respect to payments which the underwriters, dealers or
agents may be required to make.
Underwriters, dealers and agents may engage in transactions with, or perform
services for, us or our subsidiaries in the ordinary course of their
businesses.
LEGAL OPINIONS
Thomas F. Farrell, II, Esq., who is our Senior Vice President--Corporate and
General Counsel, or another of our lawyers, will issue an opinion about the
legality of the offered securities for us. Any underwriters will be advised
about other issues relating to any offering by their own legal counsel.
EXPERTS
Deloitte & Touche LLP, independent accountants, audited our financial
statements and schedules incorporated by reference in this prospectus and
elsewhere in the registration statement. These documents are incorporated by
reference herein in reliance upon the authority of Deloitte & Touche LLP as
experts in accounting and auditing in giving the report.
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6,000,000 Shares
[LOGO OF DOMINION RESOURCES INC.]
Common Stock
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PROSPECTUS SUPPLEMENT
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Merrill Lynch & Co.
November 21, 2000
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