-----BEGIN PRIVACY-ENHANCED MESSAGE-----
Proc-Type: 2001,MIC-CLEAR
Originator-Name: webmaster@www.sec.gov
Originator-Key-Asymmetric:
MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen
TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB
MIC-Info: RSA-MD5,RSA,
Byi9u1m8hZ8h1TTME01V+WzX8I2gOkxqmh6ViSwUkayN0cDpLwDgEyiphJWW61B7
upAsWTUP9ydc3aL3zG0t6g==
SECURITIES AND EXCHANGE COMMISSION FORM 11-K Pursuant to Section 15(d) of the (Mark One): X ANNUAL REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES For the fiscal year ended December 31, 2000. or _______ TRANSITION REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934. For the transition period from _________ to ________________. Commission File number 333-87529 A. Full title of the plan and the address of the plan, if different from that of the issuer named below: Virginia Power B. Name of issuer of the securities held pursuant of the plan and the address of its principal executive office: DOMINION RESOURCES, INC. VIRGINIA POWER TABLE OF CONTENTS
WASHINGTON, D.C. 20549
ANNUAL REPORT
Securities Exchange Act of 1934
EXCHANGE ACT OF 1934.
Hourly Employee Savings Plan
120 Tredegar Street
Richmond, VA 23219
HOURLY EMPLOYEE SAVINGS PLAN
FINANCIAL STATEMENTS
Pages |
||
Independent Auditors' Report |
2 |
|
Financial Statements: |
|
|
Statements of Net Assets Available for Benefits as of December 31, 2000 and 1999 |
|
|
Statement of Changes in Net Assets Available |
|
|
Notes to Financial Statements |
5-11 |
|
Supplemental Schedules as of and for the year ended |
|
|
Schedule H, Item 4(j) - Schedule of Assets Held for |
|
|
Schedule H, Item 4(j) Schedule of Reportable Transactions |
13 |
|
|
|
1
INDEPENDENT AUDITORS' REPORT
To the Organization, Compensation, and Nominating Committee of theWe have audited the accompanying financial statements of the Virginia Power Hourly Employee Savings Plan (the Plan) as of December 31, 2000 and 1999 and for the year ended December 31, 2000, listed in the Table of Contents on Page 1. These financial statements are the responsibility of the Plan's management. Our responsibility is to express an opinion on these financial statements based on our audits.
We conducted our audits in accordance with auditing standards generally accepted in the United States of America. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.
In our opinion, such financial statements present fairly, in all material respects, the net assets available for benefits of the plan as of December 31, 2000 and 1999, and the changes in net assets available for benefits for the year ended December 31, 2000, in conformity with accounting principles generally accepted in the United States of America.
Our audits were conducted for the purpose of forming an opinion on the basic financial statements taken as a whole. The accompanying supplemental schedules listed in the Table of Contents are presented for purposes of additional analysis and are not a required part of the basic financial statements, but are supplementary information required by the Department of Labor's Rules and Regulations for Reporting and Disclosure under the Employee Retirement Income Security Act of 1974. These supplemental schedules are the responsibility of the Plan's management. Such supplemental schedules have been subjected to the auditing procedures applied in our audit of the basic 2000 financial statements and, in our opinion, are fairly stated in all material respects when considered in relation to the basic financial statements taken as a whole.
Deloitte & Touche LLP
Richmond, Virginia
June 25, 2001
2
VIRGINIA POWER |
|||||
December 31, |
|||||
2000 |
1999 |
||||
Assets: |
|||||
Investments (Notes 3 and 4) |
$188,000,856 |
$129,774,736 |
|||
Receivables: |
|||||
Interest |
134,515 |
112,362 |
|||
Securities sold |
-- |
123,411 |
|||
Total Receivables |
134,515 |
235,773 |
|||
Cash |
276,658 |
251 |
|||
Total Assets |
188,412,029 |
130,010,760 |
|||
Liabilities: |
|||||
Administrative Expenses Payable |
110,844 |
-- |
|||
Payables for Investments Purchased |
666,902 |
518,091 |
|||
Total Liabilities |
777,746 |
518,091 |
|||
Net Assets Available for Benefits |
$187,634,283 |
$129,492,669 |
The accompanying notes are an integral part of the financial statements.
3
VIRGINIA POWER |
|||||||||||
Year Ended |
|||||||||||
Additions: Investment income: |
|||||||||||
Net appreciation in fair value of investments |
$ 49,990.509 |
||||||||||
Dividends |
5,120,309 |
||||||||||
Income from Master Trust |
1,572,348 |
||||||||||
Interest |
376,511 |
||||||||||
Total investment income |
57.059,677 |
||||||||||
Contributions: |
|||||||||||
Participant |
9,050,272 |
||||||||||
Participating company |
3,378,917 |
||||||||||
Total additions |
69,488,866 |
||||||||||
Deductions: |
|||||||||||
Benefits paid to participants |
8,670,286 |
||||||||||
Administrative expenses |
184,985 |
||||||||||
Total deductions |
8,855,271 |
||||||||||
Net increase in net assets before transfers |
60,633,595 |
||||||||||
Net transfer of participants' assets from the Plan to other plans |
(2,491,981) |
||||||||||
Net increase |
58,141,614 |
||||||||||
Net assets available for benefits: |
|||||||||||
Beginning of year |
129,492,669 |
||||||||||
End of year |
$187,634,283 |
The accompanying notes are an integral part of the financial statements.
4
NOTES TO FINANCIAL STATEMENTS
1. DESCRIPTION OF PLAN
The following description of the Virginia Power Hourly Employee Savings Plan (the Plan) provides only general information. Participants should refer to the Plan document for a more complete description of the Plan's provisions.
a. GENERAL - The Plan is a defined contribution plan covering all full-time hourly employees of the Virginia Electric and Power Company (the Company) who have six months of service and are age 18 or older. The Company, a wholly owned subsidiary of Dominion Resources, Inc. (Dominion), is the designated Plan sponsor, fiduciary and administrator. Mellon Bank serves as the trustee of the Plan. The Plan is subject to the provisions of the Employee Retirement Income Security Act of 1974 (ERISA).
b. CONTRIBUTIONS - A maximum of 20% of the participant's eligible earnings and 10% of highly compensated employee's eligible earnings can be invested in the Plan. Of the 20%, up to 15% can be invested on a tax-deferred basis. The Company contributes a matching amount equivalent to 50% of each participant's contributions, not to exceed 3% of the participant's eligible earnings, which is used to purchase Dominion common stock. Contributions are subject to certain Internal Revenue Code limitations.
c. PARTICIPANT ACCOUNTS - Individual accounts are maintained for each Plan participant. Each participant's account includes the effect of the participant's contributions and withdrawals, as applicable, and allocations of the Company's contributions, Plan earnings, and administrative expenses. Allocations are based on participant earnings or account balances, as defined. The benefit to which a participant is entitled is the benefit that can be provided from the participant's account.
d. PARTICIPANTS - Any subsidiary of Dominion may adopt the Plan for the benefit of its qualified hourly employees subject to approval of the Board of Directors of the Company. Through December 2000, only Company employees were participating in the Plan. (See Note 10 for additional information).
e. VESTING - Participants become vested in their own contributions and the earnings on these amounts immediately, and in the participating companies' matching contributions and earnings after three years of service. Matching contributions vest immediately for participants aged 55 or older. Forfeited balances of terminated participants' non-vested accounts are used to reduce future Participating Companies' contributions.
f. INVESTMENT OPTIONS
Employee Contributions: Upon enrollment in the Plan, a participant may direct employee contributions in any option (except the loan fund) in 1% increments totaling to 100%. Changes in investment options may be made at any time and become effective with the subsequent pay period. Participants can make unlimited transfers among existing funds. The Plan provides for employee contributions to be invested in the following:
5
(1) Common Stock:
Dominion Resources, Inc. (Dominion) Common Stock Fund - All investments are in Dominion Common Stock or cash equivalent investments for partial shares.
(2) Interest in Certus Stable Value Fund Master Trust:
Certus Stable Value Fund - The fund invests in investment contracts of insurance companies and commercial banks and U.S. Government or agency backed bonds.
(3) Mutual Funds:
Premier Managed Income Fund - The fund invests primarily in investment-grade corporate and U.S. Government obligations having maturities of 10 years or less.
Dreyfus Premier Balanced Fund - The fund invests in common stocks and bonds in proportions consistent with expected returns and risks as determined by the fund's managers. The fund's neutral allocation is 60% to common stocks and 40% to bonds.
MAS Mid Cap Value Portfolio - The fund invests in equity securities of medium sized companies that demonstrate valuation characteristics that are attractive to the fund's managers.
Warburg Pincus Emerging Growth Fund - The fund invests in equity securities of primarily domestic emerging growth companies.
Templeton Foreign Fund - The fund invests primarily in equity and debt securities of companies and governments outside the U.S.
(4) Common/Collective Trust:
Mellon EB Daily Liquidity Index Fund - The fund invests primarily in the 500 stocks of the S&P 500 Index.
Company contributions: Company matching contributions are automatically contributed into the Dominion Common Stock fund. However, participants who are under age 50 may transfer 50% of the value of their Company Match Account into another investment option, while participants who are age 50 and over may transfer 100% of the value of the Company Match Account.
g. PARTICIPANT LOANS - Participants are eligible to secure loans against their plan account and repay the amount over a one to five-year period. The minimum loan amount is $1,000 and the maximum loan amount is the lesser of:
* 50% of the vested account balance or
* $50,000 (reduced by the maximum outstanding loan balance during the prior 12 months).
Loan transactions are treated as a transfer between the respective investment fund and the loan fund. The loans are interest bearing at one percentage point above the prime rate of interest. The rate is determined every quarter; however, the rate is fixed at the inception of the loan for the life of the loan.
6
Participants make repayments to the Plan on a monthly basis. Any defaults in loans result in a reclassification of the remaining loan balances as taxable distributions to the participants.
h. PAYMENTS OF BENEFITS - Distributions from the Plan are recorded on the valuation date when a participant's valid withdrawal request is processed by the recordkeeper. On termination of service, a participant may elect to receive either a lump-sum amount equal to the value of the participant's vested interest in his or her account, or defer the payment to a future time no later than the year in which the participant attains age 70 1/2. There were no amounts payable to participants at December 31, 2000 and 1999.
i. FLEXIBLE DIVIDEND OPTION - Participants are given the choice of (1) receiving cash dividends paid on vested shares held in their Dominion Common Stock Fund or (2) reinvesting the dividends in the fund.
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
a. BASIS OF ACCOUNTING- The accompanying financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America.
b. VALUATION OF INVESTMENTS:
(1) Dominion Common Stock Fund - The investments of the Stock Fund are stated at fair value based on the closing sales prices reported on the New York Stock Exchange on the last business day of the year.
(2) Mutual Funds - Investments in mutual funds are valued at quoted market prices, which represent the net asset values of shares held by the Plan at year-end.
(3) Common/Collective Trusts - Investments in common/collective trust funds (funds) are stated at estimated fair values, which have been determined based on the unit values of the funds. Unit values are determined by the bank sponsoring such funds by dividing the fund's net assets by its units outstanding at the valuation dates.
(4) Investment in Certus Stable Value Fund Master Trust - The fund invests primarily in guaranteed investment contracts, which are valued at contract value. Contract value represents contributions made under the contract, plus earnings, less Plan withdrawals and administrative expenses.
c. INVESTMENT INCOME - Dividend income is recognized on the ex-dividend date.
d. EXPENSES - The Plan's expenses are accrued as incurred and paid by the Plan, as provided by the Plan document.
e. USE OF ESTIMATES - The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of net assets available for benefits and changes therein. Actual results could differ from those estimates.
f. CONCENTRATION OF INVESTMENTS - Included in the Plan's net assets available for benefits at December 31, 2000 and 1999, are investments in Dominion Common Stock amounting to approximately $126 million and $72 million, respectively, whose value could be subject to change based upon market conditions.
7
g. RECENTLY ISSUED ACCOUNTING STANDARD - FASB 133-The Plan adopted the provisions of SFAS No. 133, Accounting for Derivative Instruments and Hedging Activities, as amended by Statements of Financial Accounting Standards No. 137, Accounting for Derivative Instruments and Hedging Activities-Deferral of the Effective Date of FASB Statement No. 133, and No. 138, Accounting for Certain Derivative Instruments and Certain Hedging Activities, and as interpreted by the FASB and the Derivatives Implementation Group through "Statement 133 Implementation Issues," as of October 1, 2000. Derivative instruments (if any) held by the Plan are presented at estimated fair value on the Statements of Net Assets.
3. INVESTMENTS
The following presents investments that represent 5% or more of the Plan's net assets available for benefits:
2000 |
1999 |
||||||
Dominion Common Stock |
$69,371,589* |
$39,571,258* |
|||||
Dominion Common Stock |
56,552,463 |
32,872,077 |
|||||
Interest in Certus Stable Value Master Trust |
25,208,062 |
21,540,629 |
|||||
Warburg Pincus Emerging Growth Fund |
9,646,991 |
9,328,337 |
|||||
Mellon S&P 500 Index Daily Fund |
9,245,557 |
9,723,619 |
* Nonparticipant-directed
During 2000, the Plan's investments (including gains and losses on investment bought and sold, as well as held during the year) appreciated in value by $49,990,509 as follows:
Investment at Fair Value:
Mutual Funds |
$(1,086,880) |
Common Stock |
52,131,808 |
Investments at Estimated Fair Value: |
|
|
$49,990,509 |
4. Nonparticipant-Directed Investments
Information about the net assets and the significant components of the changes in net assets relating to the nonparticipant-directed investments is as follows:
December 31, |
|||
2000 |
1999 |
||
Net Assets: |
|||
Investments: |
|||
Dominion Common Stock |
$ 69,371,589 |
$ 39,571,258 |
|
Common/Collective Trusts |
297,497 |
242,762 |
|
Total Investments |
69,669,086 |
39,814,020 |
8
Receivables: |
|||
Interest |
1,344 |
1,007 |
|
Securities Sold |
-- |
34,873 |
|
Total Receivables |
1,344 |
35,880 |
|
|
|
||
Total Assets |
69,670,430 |
39,849,900 |
|
Liabilities - Payables for Investments Purchased |
323,604 |
268,005 |
|
Net Assets Available for Benefits |
$ 69,346,826 |
$39,581,895 |
Year Ended December 31, 2000 |
|||||
Changes in Net Assets: |
|||||
Net appreciation in fair value of investments |
28,246,135 |
||||
Dividend income |
2,586,265 |
||||
Interest |
10,483 |
||||
Contributions |
3,378,917 |
||||
Benefits paid to participants |
(2,375,096) |
||||
Administrative expenses |
(37,230) |
||||
Transfers to participant-directed investments |
(1,021,078) |
||||
Transfers of participants' assets to other plans |
(1,023,465) |
||||
Net increase |
$ 29,764,931 |
||||
5. PLAN TERMINATION
Although it has not expressed any intention to do so, the Company has the right under the Plan to discontinue its contributions at any time and to terminate the Plan subject to the provisions set forth in ERISA. In the event of any termination of the Plan, or upon complete or partial discontinuance of contributions, the accounts of each affected participant shall become fully vested.
6. RELATED PARTY TRANSACTIONS
Certain Plan investments are shares of mutual funds or common collective funds managed by investment management companies directly or indirectly owned by Mellon Bank, NA. Mellon Bank, NA is the trustee as defined by the Plan and therefore, these transactions qualify as exempt party-in-interest transactions. Fees paid by the Plan for these investment management services amounted to $2,347 for the year ended December 31, 2000.
9
7. PLAN INTEREST IN THE CERTUS STABLE VALUE FUND MASTER TRUST
The Plan's investments are in a Master Trust which was established for the investment of assets for the Plan and other Company sponsored plans (the Dominion Resources, Inc. Employee Savings Plan and the Dominion Subsidiary Savings Plan). The assets of the Master Trust are held by Mellon Bank. As of December 31, 2000 and 1999, the assets of the Master Trust were separately maintained by each Company sponsored plan, with the exception of the Certus Stable Value Fund (Certus Fund). As of December 31, 2000 and 1999, the Plan's interest in the net assets of the Certus Fund was approximately 24%. Investment income and administrative expenses relating to the Certus Fund are allocated to the individual plans based upon average monthly balances invested by each plan.
The following table presents the value of the undivided investments (and related investment income) in the Certus Stable Value Fund:
December 31, |
||||||||
2000 |
1999 |
|||||||
Guaranteed Investment Contracts (contract value) |
$88,700,680 |
$87,826,074 |
||||||
Short-term Investment Fund (estimated fair value) |
14,673,692 |
2,975,590 |
||||||
Interest Receivable |
31,359 |
-- |
||||||
Total |
$103,405,731 |
$90,801,664 |
||||||
Investment income for the Certus Stable Value |
||||||||
Fund is as follows: |
2000 |
1999 |
||||||
Interest |
$6,159,222 |
$5,190,027 |
||||||
Less investment expenses |
(223,193) |
(194,858) |
||||||
Total |
$5,936,029 |
$4,995,169 |
The aggregate fair value of the investment contracts and short-term investments of the Fund at December 31, 2000 and 1999 was $104,896,096 and $89,271,133 respectively. The average yield of assets on December 31, 2000 and 1999 are estimated at 6.66% and 6.45%, respectively. Average duration of investment contracts within the Fund was 2.31 years at December 31, 2000 and 2.92 years at December 31, 1999. The crediting interest rates used to determine fair value for the contracts as of December 31, 2000 ranged from 6.00% to 6.31%.
8. FEDERAL INCOME TAX STATUS
The Plan is a qualified employees' profit sharing trust and employee stock ownership plan under Sections 401(a), 401(k) and 404(k) of the Internal Revenue Code and, as such, is exempt from Federal income taxes under Section 501(a). Pursuant to Section 402(a) of the Internal Revenue Code, a participant is not taxed on the income and pretax contributions allocated to the participant's account until such time as the participant or the participant's beneficiaries receive distributions from the Plan.
The Plan obtained its latest determination letter on November 9, 1993, in which the Internal Revenue Service stated that the Plan, as then designed, was in compliance with the applicable requirements of the Internal Revenue Code. The Plan has been amended since receiving the determination letter. However, the Company believes that the Plan is currently designed and operating in compliance with the applicable requirements of the Internal Revenue Code.
10
9. MERGER OF CNG AND DOMINION
During 1999, the Plan was amended to allow the Trustee, Mellon Bank, to solicit elections from participants with respect to the Company stock allocated to their Plan accounts. This amendment was made in anticipation of the merger of Dominion Resources, Inc. with Consolidated Natural Gas. The merger agreement called for a two-step merger process. The first step, the First Merger, allowed shareholders of Dominion common stock to elect to exchange their sold shares for cash (at $43 per share), new Dominion shares or a combination of cash and shares. The second step, the Second Merger, allowed shareholders of CNG common stock to elect to exchange their old shares for cash or new Dominion shares (at a prescribed formula) or a combination of cash and shares.
As directed Trustee, Mellon Bank solicited elections from participants with respect to shares of stock allocated to their accounts. The merger was finalized on January 28, 2000 and results were posted to participants' accounts on February 14, 2000.
10. PLAN MERGER
On October 20, 2000, the Board of Directors put forth a resolution stating that the Dominion Subsidiary Savings Plan would be merged with the Virginia Power Hourly Plan and with the Dominion Resources, Inc. Employee Savings Plan. On December 30, 2000, assets were transferred to the Virginia Power Hourly Employee Savings Plan representing the account balances of participants in the Subsidiary plan who were full-time hourly employees of Dominion Kincaid (a wholly-owned subsidiary of Dominion Energy). A resolution by Dominion Energy to adopt the Plan for the benefit of its hourly employees at Dominion Kincaid was also effective as of the date of the asset transfer.
Effective January 1, 2001, the plan was renamed the Dominion Hourly Employee Savings Plan.
11
VIRGINIA POWER SCHEDULE H, Item 4(i): SCHEDULE OF ASSETS HELD FOR INVESTMENT PURPOSES |
||||
Description |
Cost |
Value |
||
Dominion Resources, Inc., Common Stock |
$ 73,200,653 |
$ 125,924,012 |
||
Interest in Certus Stable Value Fund Master Trust |
||||
Certus Stable Value Fund |
25,208,062 |
25,208,062 |
||
Common/Collective Trusts |
||||
Dominion Common Stock Fund- EB Daily Liquidity |
544,425 |
544,424 |
||
Mellon S&P 500 Index Daily Fund |
7,796,217 |
9,245,557 |
||
8,340,642 |
9,789,981 |
|||
Mutual Funds |
||||
MAS Mid Cap Value Fund |
5,770,279 |
5,830,360 |
||
Dreyfus Premier Balanced Fund Inc. |
4,021,659 |
3,833,501 |
||
Dreyfus Premier Managed Income Fund |
596,051 |
582,130 |
||
Templeton Foreign Fund Inc. |
2,463,339 |
2,530,907 |
||
Warburg Pincus Emerging Growth Fund |
10,813,598 |
9,646,991 |
||
23,664,926 |
22,423,889 |
|||
Loans to Participants |
4,654,912 |
4,654,912 |
||
Total Assets Held for Investment |
$ 135,069,195 |
$ 188,000,856 |
12
VIRGINIA POWER
HOURLY EMPLOYEE SAVINGS PLAN
SUPPLEMENTAL SCHEDULE AS OF DECEMBER 31, 2000
SCHEDULE H, ITEM 4(j): SCHEDULE OF REPORTABLE TRANSACTIONS
Series of Transactions in Excess of Five Percent of Plan Assets |
|||||||||||||||||||||||||||
Shares/ |
Security |
Transaction |
Cost of |
Proceeds |
Costs of Assets |
Gain/ |
|||||||||||||||||||||
Par Value |
Description |
Expense |
Purchases |
From Sales |
Disposed |
Loss |
|||||||||||||||||||||
285,679.00 |
Dominion Res. Inc. Common Stock* |
$ - |
$13,584,261.85 |
$ - |
$ - |
$ - |
|||||||||||||||||||||
109,176.00 |
Dominion Res. Inc. Common Stock* |
$ - |
$ - |
$ 8,523,857.05 |
$ 6,512,696.60 |
$2,011,160.45 |
|||||||||||||||||||||
* A party-in-interest as defined by ERISA |
13
Exhibit 23
INDEPENDENT AUDITORS' CONSENT
We consent to the incorporation by reference in Registration Statement No. 333-87529 of Dominion Resources, Inc. on Form S-8 of our report dated June 25, 2001, appearing in this Annual Report on Form 11-K of Virginia Power Hourly Employee Savings Plan for the year ended December 31, 2000.
DELOITTE & TOUCHE LLP
Richmond, Virginia
June 25, 2001