S-3ASR
Table of Contents

As filed with the Securities and Exchange Commission on November 2, 2017

Registration No. 333-            

 

 

 

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

 

Form S-3

REGISTRATION STATEMENT

under

THE SECURITIES ACT OF 1933

 

 

Dominion Energy, Inc.

(Exact name of Registrant as Specified in Its Charter)

 

 

 

Virginia   54-1229715

(State or other jurisdiction of

incorporation or organization)

 

(I.R.S. Employer

Identification Number)

120 Tredegar Street

Richmond, Virginia 23219

804-819-2000

(Address, Including Zip Code, And Telephone Number, Including Area Code, of Registrant’s Principal Executive Offices)

 

 

Carlos M. Brown

Vice President and General Counsel

Dominion Energy, Inc.

120 Tredegar Street

Richmond, Virginia 23219

804-819-2690

(Name, Address Including Zip Code, And Telephone Number, Including Area Code, of Agent For Service)

 

 

Copies To:

Jane Whitt Sellers, Esq.

McGuireWoods LLP

Gateway Plaza

800 East Canal Street

Richmond, Virginia 23219

804-775-1000

 

 

Approximate date of commencement of proposed sale to the public: From time to time after this Registration Statement becomes effective as determined by market conditions.

If the only securities being registered on this Form are being offered pursuant to dividend or interest reinvestment plans, please check the following box.  ☐

If any of the securities being registered on this Form are to be offered on a delayed or continuous basis pursuant to Rule 415 under the Securities Act of 1933, check the following box:  ☒

If this Form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, please check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering.  ☐

If this Form is a post-effective amendment filed pursuant to Rule 462(c) under the Securities Act, check the following box and list the Securities act registration statement number of the earlier effective registration statement for the same offering.  ☐

If this Form is a registration statement pursuant to General Instruction I.D. or a post-effective amendment thereto that shall become effective upon filing with the Commission pursuant to Rule 462(e) under the Securities Act, check the following box.  ☒

If this Form is a post-effective amendment to a registration statement filed pursuant to General Instruction I.D. filed to register additional securities or additional classes of securities pursuant to Rule 413(b), check the following box.  ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company” and “emerging growth company” in Rule 12b-2 of the Exchange Act. (Check one):

 

Large accelerated filer      Accelerated filer  
Non-accelerated filer   ☐  (Do not check if a smaller reporting company)    Smaller reporting company  
     Emerging growth company  

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 7(a)(2)(B) of Securities Act.  ☐

 

 

CALCULATION OF REGISTRATION FEE

 

 

Title of Each Class of

Securities to be Registered

 

Amount

to be

Registered(1)

 

Proposed

Maximum

Aggregate

Price Per Unit

 

Proposed

Maximum

Aggregate

Offering Price(1)

 

Amount of

Registration Fee

Variable Denomination Floating Rate Demand Notes

  $1,000,000,000   100%   $1,000,000,000   $124,500

 

 

(1) This registration statement covers all investments in the Notes up to $3.0 billion, with fees based on the net aggregate principal amount of Notes outstanding from this offering not exceeding $1.0 billion at a particular time.

 

 

 


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PROSPECTUS

 

LOGO

Dominion Energy, Inc.

Variable Denomination Floating Rate Demand Notes

 

 

Dominion Energy Reliability InvestmentSM (the Notes) is designed to provide you with a convenient means of investing your money directly with Dominion Energy, Inc. (Dominion Energy or the Company). The Notes earn a floating rate of interest to be determined at the direction of the Dominion Energy Reliability Investment Committee (the Committee). The initial interest rate applicable to the Notes and all subsequent changes to the initial interest rate will be disclosed in prospectus supplements filed with the Securities and Exchange Commission (the SEC).

The Notes are in book-entry form and have no stated maturity. The Notes are issuable in any amount, may be redeemed upon your demand as described in this prospectus and are subject to redemption by Dominion Energy at any time. The Notes have a principal amount equal to the total amount of your investment, plus reinvested interest, after deducting redemptions and fees, if any. The Notes earn interest which will accrue and be compounded daily and be automatically reinvested in Notes on the last business day of each month.

The Notes will rank equally in priority with all of Dominion Energy’s existing and future unsecured and non-subordinated debt and will rank senior in right of payment to all of Dominion Energy’s existing and future subordinated debt. As of September 30, 2017, Dominion Energy had approximately $16.8 billion principal amount of outstanding long-term debt on an unconsolidated basis (including securities due within one year), consisting of approximately $11.4 billion of unsecured and non-subordinated debt and $5.4 billion of unsecured junior subordinated debt. The Notes are also structurally subordinated to all indebtedness and other liabilities of Dominion Energy’s subsidiaries. As of September 30, 2017, Dominion Energy’s subsidiaries had approximately $16.9 billion principal amount of outstanding long-term debt (including securities due within one year).

The Notes are offered on a continuous basis. Notes registered on the registration statement of which this prospectus is a part represent the maximum aggregate principal amount of the Notes, equal to $3,000,000,000, which are expected to be offered for sale. The outstanding principal amount of the Notes will increase and decrease from time to time. The maximum net aggregate principal amount of the Notes that may be outstanding at any one time is $1,000,000,000.

 

 

Investing in Dominion Energy Reliability Investment involves risks. For a description of these risks, see “Risk Factors” on page 5 of this prospectus and the Risk Factors section of our most recent Annual Report on Form 10-K and in our other reports filed with the Securities and Exchange Commission.

Please read this prospectus carefully and retain for future reference. Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of these securities or determined that this prospectus is truthful or complete. Any representation to the contrary is a criminal offense.

The date of this prospectus is November 2, 2017


Table of Contents

TABLE OF CONTENTS

 

     Page  

Important Information

     ii  

Where You Can Find More Information

     1  

Forward-Looking Statements

     1  

Summary

     3  

Risk Factors

     5  

Dominion Energy

     7  

Use of Proceeds

     8  

Ratio of Earnings to Fixed Charges

     9  

Dominion Energy Reliability Investment

     11  

Agent Bank

     19  

Description of the Notes

     20  

Termination, Suspension or Modification

     24  

Rights May Not Be Assigned, Transferred or Pledged

     25  

Plan of Distribution

     26  

Validity of Notes

     27  

Experts

     27  

We have not authorized anyone to provide any information other than that contained in this prospectus or in any free writing prospectus prepared by or on behalf of us or to which we have referred you. We take no responsibility for, and can provide no assurance as to the reliability of, any other information that others may give you. We are not offering the Notes in any state where the offer is not permitted. We do not claim the accuracy of the information in this prospectus as of any date other than the date stated on the cover, regardless of the time of delivery of this prospectus or any sale of the Notes.

 

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IMPORTANT INFORMATION

An investment in the Notes involves risks. Prospective investors should carefully review the risk factors, as well as the other information, contained or incorporated by reference in this prospectus. You should consult your own financial and legal advisers as to the risks involved in an investment in the Notes and whether an investment is suitable for you.

All of the money you invest will be used to purchase Notes for you. All interest earned on your Notes will be reinvested monthly in additional Notes for your investment. All investments in the Notes are investments in unsecured debt obligations of Dominion Energy, Inc. Only our assets are available to pay the principal and interest on the Notes. We do not maintain reserves for our obligations under the Notes and the Notes are not subject to any sinking fund. The Notes are unsecured and are not obligations of or guaranteed, endorsed or insured by any of our subsidiaries, The Northern Trust Company, which acts as the agent bank for the Notes, the Trustee or any other company. It is possible for you to lose some or all of your investment, including accrued interest, if we are unable to pay our debts, become bankrupt or seek creditor protection.

The Notes are not a money market fund, which is typically a diversified fund consisting of short-term debt securities of many issuers. The Notes are not subject to the requirements of the Investment Company Act of 1940 (including those regarding diversification and quality of investments for money market funds) or the Employee Retirement Income Security Act of 1974, as amended. The Notes are not equivalent to a deposit or other bank account and are not subject to the protection of Federal Deposit Insurance Corporation regulation or insurance or any other insurance. The Notes are not transferable, assignable or negotiable, they are not listed on any securities exchange, and there is no secondary market for the Notes. As a result, there is no public market valuation for the Notes.

The interest rate paid on investments in the Notes may not provide a basis for comparison with bank deposits or money market funds, which may use a different method of calculating yield, or other investments which pay a fixed yield for a stated period of time. The interest rate also does not necessarily bear any relation to the risks associated with or changes in our creditworthiness, credit rating or financial condition and may not compensate you for any increase in credit risk of investment in the Notes.

 

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WHERE YOU CAN FIND MORE INFORMATION

We file annual, quarterly and current reports, proxy statements and other information with the SEC. Our file number with the SEC is 001-08489. 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 room at 100 F. Street, N.E., Washington, D.C. 20549. Please call the SEC at 1-800-SEC-0330 for further information on the public reference room.

The SEC allows us to “incorporate by reference” the information we file with it, 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 information that we file later with the SEC will automatically update or supersede this information. We make some of our filings with the SEC on a combined basis with two of our subsidiaries, Virginia Electric and Power Company (Virginia Power) and Dominion Energy Gas Holdings, LLC (Dominion Energy Gas). Our combined filings with the SEC present separate filings by each of Virginia Power, Dominion Energy Gas and the Company. We incorporate by reference the documents listed below (other than any portions of the documents not deemed to be filed) 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, except those portions of filings that relate to Virginia Power or Dominion Energy Gas as a separate registrant, until we sell all of the securities:

 

    Annual Report on Form 10-K for the year ended December 31, 2016;

 

    Quarterly Reports on Form 10-Q for the quarterly periods ended March 31, 2017, June 30, 2017 and September 30, 2017; and

 

    Current Reports on Form 8-K or Form 8-K/A, filed January 12, 2017, January 24, 2017, January 27, 2017, March 27, 2017, May 10, 2017, May 18, 2017, July 3, 2017, October 2, 2017 and October 30, 2017.

You may request a copy of any of the documents incorporated by reference at no cost, by writing or telephoning us at: Corporate Secretary, Dominion Energy, Inc., 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 to which this prospectus refers you. We have 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 prospectus may only be used where it is legal to sell these securities. The information which appears in this prospectus and which is incorporated by reference in this prospectus may only be accurate as of the date of this prospectus or the date of the document in which incorporated information appears. Our business, financial condition, results of operations and prospects may have changed since that date.

FORWARD-LOOKING STATEMENTS

This prospectus and the information incorporated by reference in this prospectus include forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Forward-looking statements are based on our management’s beliefs and assumptions and can often by identified by terms and phrases that include “anticipate,” “believe,” “intend,” “estimate,” “expect,” “continue,” “should,” “could,” “may,” “plan,” “project,” “predict,” “will,” “potential,” “forecast,” “target,” “guidance,” “outlook,” or other similar terminology. Various factors may cause actual results to be materially different than the suggested outcomes within forward-looking statements; accordingly, there is no assurance that such results will be realized.

 

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In light of these risks, uncertainties and assumptions, the events described in the forward-looking statements included or incorporated by reference in this prospectus might not occur or might occur to a different extent or at a different time than described. Forward-looking statements speak only as of the date they are made and we expressly disclaim an obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.

 

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SUMMARY

 

Issuer

Dominion Energy, Inc.

 

Title of Securities

Variable Denomination Floating Rate Demand Notes, marketed and sold as Dominion Energy Reliability Investment.

 

Amount

Up to $3,000,000,000 aggregate offering price. The maximum net aggregate principal amount of the Notes that may be outstanding at any one time is $1,000,000,000.

 

Investment Options

Check Investment, see page 12.

 

  Automatic Investment, see page 13.

 

  Directed Investment, see page 13.

 

  Wire Transfer Investment, see page 14.

 

  Automatic Social Security Investment, see page 14.

 

Redemption Options

Check Redemption, see page 15.

 

  Bank Check Redemption, see page 15.

 

  ACH Redemption, see page 16.

 

Status

The Notes are unsecured debt obligations of Dominion Energy, Inc., rank equally and ratably with all of our other unsecured and non-subordinated debt, and rank senior in right of payment to all of our subordinated debt. Only our assets are available to pay principal and interest on the Notes. Dominion Energy, Inc. is a holding company, and we operate our businesses through our subsidiaries. The Notes are not obligations of or guaranteed, endorsed or insured by our subsidiaries, The Northern Trust Company, which acts as the agent bank for the Notes, the Trustee or any other company. We do not maintain reserves for our obligations under the Notes, and the Notes are not subject to any sinking fund.

 

  The Notes are structurally subordinated to the indebtedness and other liabilities of our subsidiaries. As of September 30, 2017, our subsidiaries had approximately $16.9 billion principal amount of outstanding long-term debt (including securities due within one year).

 

Maturity

The Notes mature on demand.

 

Interest

The Notes will bear interest at a floating rate per annum to be determined at the direction of the Committee on a weekly basis to be effective on Monday of the week following such determination. Interest will accrue and be compounded daily and be automatically reinvested in Notes on the last business day of each month. See page 11.

 



 

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Principal

The principal amount of your Notes will equal all of your investments and reinvested interest less redemptions and fees, if any.

 

Fees

Fees, if any, may be assessed for investments or redemptions returned due to insufficient funds, stop payment requests and other special services, see page 17.

 

Form of Notes

The Notes will be issued in uncertificated form, see page 21.

 

Maximum Total Investment

The total maximum outstanding investment for any one investor shall not exceed $1,250,000 at any time. See page 21.

 

Redemption at Option of Dominion Energy

The Notes may be redeemed by Dominion Energy at its option, see page 21.

 

Agent Bank

The Northern Trust Company.

 

Tax Status

Interest credited to each of the Notes is reportable as taxable income for Federal tax purposes. Backup withholding may apply to certain persons, see page 17.

 

Trustee

Deutsche Bank Trust Company Americas.

 

Broker-Dealer

Georgeson Securities Corporation.

 

Rating

Dominion Energy has not requested, and does not anticipate receiving, a rating for the Notes from any rating agency.

 



 

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RISK FACTORS

Investing in our securities involves risks. Before purchasing any Notes, you should carefully consider the risks discussed below and the risk factors that are incorporated by reference in this prospectus from the section captioned “Risk Factors” in our Form 10-K for the year ended December 31, 2016, together with all of the other information included in this prospectus and any other information that we have incorporated by reference, including filings made with the SEC after the date of this prospectus. Any of these risks, as well as other risks and uncertainties, could harm our financial condition, results of operations or cash flows. See Where You Can Find More Information on page 1.

Risks Relating to the Notes

 

    An investment in the Notes does not create a bank account or depositor relationship between you and Dominion Energy or The Northern Trust Company, as the agent bank.

 

    The Notes are not equivalent to a deposit or other bank account and are not subject to the protection of Federal Deposit Insurance Corporation (FDIC) regulation or insurance or any other insurance.

 

    All of the money you invest will be used to purchase Notes for you. All interest earned on your Notes will be reinvested monthly in additional Notes for your investment. The Notes are not a money market fund, which is typically a diversified fund consisting of short-term debt of many issuers. The Notes are not subject to regulation under the Investment Company Act of 1940, as amended. Consequently, you will not have the benefit of federal laws and regulations designed to help maintain liquidity and a stable share price and set standards for credit quality, diversification and for maturity of individual securities and the overall portfolio.

 

    The Notes are not subject to the requirements of the Employee Retirement Income Security Act of 1974, as amended.

 

    The Notes are not a brokerage account with Georgeson Securities Corporation or any other broker-dealer and are not protected by the Securities Investor Protection Corporation under the Securities Investor Protection Act of 1970.

 

    Dominion Energy has not requested, and does not anticipate receiving, a rating for the Notes from any rating agency.

 

    The interest rate paid on investments in the Notes may not provide a basis for comparison with bank deposits or money market funds, which may use a different method of calculating yield, or other investments which pay a fixed yield for a stated period of time. The interest rate also does not necessarily bear any relation to the risks associated with or changes in our creditworthiness, credit rating or financial condition and may not compensate you for any increase in credit risk of investment in Notes.

 

    Although you may redeem your investment in the Notes at any time in whole or in part, in the manner explained in this prospectus, you are not able to transfer your investment in the Notes to someone else. The Notes are not listed on any securities exchange, and no secondary market for the Notes currently exists nor will one develop in the future. Consequently, there is no public market valuation of the Notes to assist you in evaluating the Notes or the yield earned.

 

    The Notes are unsecured debt obligations of Dominion Energy, Inc. Only the assets of Dominion Energy, Inc. are available to pay the principal and interest on the Notes.

 

    Dominion Energy, Inc. is a holding company, and we operate our businesses through our subsidiaries. Thus, our ability to meet our obligations under the Notes is dependent on the earnings and cash flows of those subsidiaries and the ability of those subsidiaries to pay dividends or to advance or repay funds to Dominion Energy. In addition, the rights that Dominion Energy and its creditors would have to participate in the assets of any such subsidiary upon the subsidiary’s liquidation or recapitalization will be subject to the prior claims of the subsidiary’s creditors.

 

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    Holders of Notes will generally have a junior position to claims of creditors of our subsidiaries, including trade creditors, debt holders, secured creditors, taxing authorities, guarantee holders and any holders of preferred stock. In addition to trade debt, certain of our operating subsidiaries have ongoing corporate debt programs used to finance their business activities. As of September 30, 2017, on a consolidated basis (including securities due within one year), we had approximately $33.7 billion of outstanding debt, of which approximately $16.9 billion was subsidiary debt.

 

    The Notes are not guaranteed, endorsed or insured by any of our subsidiaries or any financial institution or government entity. Dominion Energy does not maintain reserves for its obligations under the Notes. There is a risk that Dominion Energy will be unable to meet interest payments or repay principal on the Notes. You may lose all or part of your investment, including accrued interest, if Dominion Energy is unable to pay its debts, enters bankruptcy or seeks protection from its creditors.

 

    You will not be able to exchange your Notes for any other securities of Dominion Energy.

 

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DOMINION ENERGY

Dominion Energy, headquartered in Richmond, Virginia and incorporated in Virginia in 1983, is one of the nation’s largest producers and transporters of energy. Our strategy is to be a leading provider of electricity, natural gas and related services to customers primarily in the eastern and Rocky Mountain regions of the U.S. Our portfolio of assets includes approximately 25,600 megawatts of generating capacity, 6,600 miles of electric transmission lines, 57,600 miles of electric distribution lines, 15,000 miles of natural gas transmission, gathering and storage pipeline and 51,300 miles of gas distribution pipeline, exclusive of service lines. We operate one of the nation’s largest natural gas storage systems with approximately one trillion cubic feet of storage capacity and serve more than six million utility and retail energy customers.

We are focused on expanding our investment in regulated and long-term contracted electric generation, transmission and distribution and regulated natural gas transmission and distribution infrastructure. Our nonregulated operations include merchant generation, energy marketing and price risk management activities and natural gas retail energy marketing operations. Our operations are conducted through various subsidiaries, including (i) Virginia Electric and Power Company, a regulated public utility that generates, transmits and distributes electricity for sale in Virginia and northeastern North Carolina, (ii) Dominion Energy Gas Holdings, LLC, a holding company for the majority of our regulated natural gas businesses, which conducts business activities through a regulated interstate natural gas transmission pipeline and underground storage system, a local, regulated natural gas transportation and distribution network and natural gas gathering and processing facilities, and (iii) Dominion Energy Questar Corporation, a holding company for our primarily regulated natural gas businesses, including retail natural gas distribution in Utah, Wyoming and Idaho and related natural gas development and production. We also own the general partner, approximately 51% of the common and subordinated units and 37.5% of the convertible preferred interests in Dominion Energy Midstream Partners, LP, which was formed by us to own and grow a portfolio of natural gas terminaling, processing, storage, transportation and related assets.

Our address and telephone number are: 120 Tredegar Street, Richmond, Virginia 23219, Telephone (804) 819-2000.

Ratio of Earnings to Fixed Charges

 

9 Months

Ended

September 30,
2017

 

12 Months

Ended

September 30,
2017

 

Years Ended December 31,

   

2016

 

2015

 

2014

 

2013

 

2012

3.11

  2.98   3.27   3.65   2.33   3.42   3.10

 

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USE OF PROCEEDS

We will use the net proceeds from the sale of the Notes to finance capital expenditures and future acquisitions and to retire or redeem debt securities issued by us and for other general corporate purposes which may include the repayment of commercial paper and debt under any of our credit facilities.

 

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RATIO OF EARNINGS TO FIXED CHARGES

For purposes of this ratio, earnings are determined by adding distributed income of equity investees and fixed charges (excluding interest capitalized) to income from continuing operations before income taxes and adjustments for noncontrolling interest after eliminating the equity in earnings or losses of equity investees. These earnings are then divided by total fixed charges. Fixed charges consist of interest charges (without reduction for Allowance for Funds Used During Construction) on long-term and short-term debt, interest capitalized, the portion of rental expense that is representative of the interest factor and preferred stock dividends of consolidated subsidiaries (grossed-up by a factor of pre-tax net income divided by net income).

The ratio of earnings to fixed charges for each of the periods indicated is as follows:

 

9 Months

Ended

September  30,
2017(a)

 

12 Months

Ended

September 30,
2017(b)

 

Years Ended December 31,

   

2016(c)

 

2015(d)

 

2014(e)

 

2013(f)

 

2012(g)

3.11

  2.98   3.27   3.65   2.33   3.42   3.10

 

(a) Earnings for the nine months ended September 30, 2017 include $39 million in transition and integration costs associated with the Dominion Energy Questar Combination; and $30 million charge related to other items, partially offset by $41 million of net gain related to our investments in nuclear decommissioning trust funds. Excluding the net effect of these items from the calculation would result in a higher ratio of earnings to fixed charges for the nine months ended September 30, 2017.
(b) Earnings for the twelve months ended September 30, 2017 include $197 million charge associated with ash pond and landfill closure costs; $52 million in transaction, transition, and integration costs associated with the Dominion Energy Questar Combination; $23 million charge related to storm and restoration costs; and $43 million charge related to other items, partially offset by $46 million of net gain related to our investments in nuclear decommissioning trust funds. Excluding the net effect of these items from the calculation would result in a higher ratio of earnings to fixed charges for the twelve months ended September 30, 2017.
(c) Earnings for the twelve months ended December 31, 2016 include $197 million charge associated with ash pond and landfill closure costs; $65 million charge associated with an organizational design initiative; $74 million in transaction and transition costs associated with the Dominion Energy Questar Combination; $23 million charge related to storm and restoration costs; and $45 million charge related to other items, partially offset by $34 million of net gain related to our investments in nuclear decommissioning trust funds. Excluding the net effect of these items from the calculation would result in a higher ratio of earnings to fixed charges for the twelve months ended December 31, 2016.
(d) Earnings for the twelve months ended December 31, 2015 include $85 million write-off of prior-period deferred fuel costs associated with Virginia legislation; $99 million charge associated with ash pond and landfill closure costs and $78 million charge related to other items, partially offset by $60 million of net gain related to our investments in nuclear decommissioning trust funds. Excluding the net effect of these items from the calculation would result in a higher ratio of earnings to fixed charges for the twelve months ended December 31, 2015.
(e) Earnings for the twelve months ended December 31, 2014 include $374 million charge related to the North Anna nuclear power station and offshore wind facilities; $284 million charge associated with our liability management effort, which is included in fixed charges; $121 million accrued charge associated with ash pond and landfill closure costs; and $93 million charge related to other items, partially offset by $100 million net gain on the sale of our electric retail energy marketing business and $72 million of net gain related to our investments in nuclear decommissioning trust funds. Excluding the net effect of these items from the calculation would result in a higher ratio of earnings to fixed charges for the twelve months ended December 31, 2014.
(f)

Earnings for the twelve months ended December 31, 2013 include a $55 million impairment charge related to certain natural gas infrastructure assets; $40 million charge in connection with the Virginia State Corporation Commission’s final ruling associated with its biennial review of Virginia Power’s base rates for

 

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  2011-2012 test years; $28 million charge associated with our operating expense reduction initiative, primarily reflecting severance pay and other employee related costs; $26 million charge related to the expected early shutdown of certain coal-fired generating units; and $29 million charge related to other items, partially offset by $81 million of net gain related to our investments in nuclear decommissioning trust funds; $47 million benefit due to a downward revision in the nuclear decommissioning asset retirement obligations for certain merchant nuclear units that are no longer in service; and $29 million net benefit primarily resulting from the sale of the Elwood power station. Excluding the net effect of these items from the calculation would result in a higher ratio of earnings to fixed charges for the twelve months ended December 31, 2013.
(g) Earnings for the twelve months ended December 31, 2012 include $438 million of impairment and other charges related the planned shut-down of the Kewaunee nuclear power station; and $87 million of restoration costs associated with severe storms affecting our Dominion Energy Virginia and Dominion Energy North Carolina service territories, partially offset by a $36 million net gain related to our investments in nuclear decommissioning trust funds; and $4 million net benefit related to other items. Excluding the net effect of these items from the calculation would result in a higher ratio of earnings to fixed charges for the twelve months ended December 31, 2012.

 

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DOMINION ENERGY RELIABILITY INVESTMENT

General

The following statements about investing in the Notes summarize the Dominion Energy Reliability Investment Plan (the Plan), a copy of which is filed as an exhibit to the registration statement of which this prospectus is a part. If this summary differs in any way from the statements in the Plan, you should rely on the Plan. You may request a copy of the Plan by calling us at 866-876-0001, or writing Dominion Energy Reliability Investment, P.O. Box 75713, Chicago, Illinois 60675-5713. All of the money you invest will be used to purchase Notes for you. Your investments in the Notes and interest thereon will be recorded on a register maintained by The Northern Trust Company, the agent bank. The principal amount of your Notes will be equal to all of your investments in the Notes, plus reinvested interest, less redemptions and fees, if any. Accrued interest is available to you for redemption as principal when it is reinvested on the last business day of each month. Investors will receive monthly statements showing a summary of all transactions occurring during the prior month, including investments, redemptions, interest earned and any fees or charges. Investors may also call toll free at 866-876-0001 from 8:30 a.m. to 7:00 p.m. Eastern time, Monday through Friday, to obtain current information about their investment in the Notes.

Eligible Investors

 

    To be eligible to invest in the Notes, you must be:

 

    a citizen of the United States, or

 

    a corporation or, except as provided in applicable United States Treasury regulations, a partnership, incorporated or established in or under the laws of any of the United States, or

 

    a trust or estate that is treated as a United States person under Section 7701 of the Internal Revenue Code, as amended.

 

    You must provide a valid Social Security number or U.S. federal tax identification number.

 

    You may invest individually or jointly with another eligible person.

 

    You may invest by naming yourself as custodian for your minor children under the Uniform Transfers to Minors Act of the state in which you reside or under any other applicable law.

Interest Rate

The Notes will bear interest at a floating rate per annum to be determined at the direction of the Committee on a weekly basis to be effective on Monday of the week following such determination. Rates may vary by an investor’s principal amount of Notes or other factors as determined at the direction of the Committee as provided for in the Dominion Energy Reliability Investment Plan.

The interest rate we pay on the Notes for any particular period does not indicate or represent the rates we will pay in the future. The interest rate paid on investments in the Notes may not provide a basis for comparison with bank deposits or money market funds, which may use a different method of calculating yield or other investments which pay a fixed yield for a stated period of time. The interest rate does not necessarily bear any relation to the risks associated with or changes in our creditworthiness, credit rating or financial condition. Interest on the Notes will accrue daily and will be compounded daily, based on a 365/366-day year. Accrued interest will be automatically reinvested in the Notes on the last business day of each month.

For information on the current interest rate being paid on the Notes, call toll free 866-876-0001.

 

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How to Make an Investment

You may invest in the Notes by submitting a completed application, along with your initial investment as described below. You may receive a blank Application Form at any time, without charge, by calling 866-876-0001 from 8:30 a.m. to 7:00 p.m. Eastern time Monday through Friday and requesting an enrollment kit.

All investors must make their initial investment in the Notes by the Check Investment option described in the Investment Options section below. The minimum initial investment is $1,000 for all investors, other than Dominion Energy employees. If you are a Dominion Energy employee, the minimum required initial investment balance of $1,000 must be attained within ten months.

All investors may make additional investments by any of the investment options described in “Investment Options” below. We may redeem Notes held by any Investor whose investment falls below $1,000. See “Description of the Notes” for more information on this optional redemption. The total maximum investment for any one investor may not exceed $1,250,000 at any point in time. See “Maximum Total Investment” for more information on investment limits.

All investments must be made in U.S. dollars. You may contact us as follows to obtain further information on how to invest or make changes to your current investment in the Notes:

 

    by telephone at 866-876-0001 from 8:30 a.m. to 7:00 p.m. Eastern time Monday through Friday; or

 

    by mail at Dominion Energy Reliability Investment, P.O. Box 75713, Chicago, Illinois 60675-5713.

To help fight the funding of terrorism and money-laundering activities, the U.S. government has passed the USA PATRIOT ACT, which requires banks, including our processing agent bank, to obtain, verify, record and, in certain circumstances, report information that identifies persons who engage in certain transactions with or through a bank. This means that, in order for you to invest in the Notes, you must provide to us the name, residential or street address (no P.O. boxes), date of birth and Social Security number or other tax identification number of ALL PERSONS listed on the investment.

Investment Options

Check Investment (Personal and Corporate Checks)

The Check Investment option permits you to make investments in Notes by submitting a personal or corporate check.

This investment option is the only option for your initial investment in the Notes. Your initial investment may be in any amount of $1,000 or more. Additional investments may be in any amount of $50 or more.

Your completed application should be mailed to Dominion Energy Reliability Investment, P.O. Box 75713, Chicago, Illinois 60675-5713 and accompanied by a check in an amount of $1,000 or more. If you are a Dominion Energy employee, you may include a check in an amount less than $1,000; however, Dominion Energy employees are required to attain an investment balance of $1,000 or more within ten months of the initial investment. Additional investments in an amount of $50 or more must be accompanied by the investment slip provided with the investment statement, provided with investment confirmation notices, or included with the supply of redemption checks. Additional investments should be mailed to Dominion Energy Reliability Investment, P.O. Box 75709, Chicago, Illinois 60675-5709. All checks should be made payable to Dominion Energy Reliability Investment in U.S. dollars and drawn on a U.S. bank. Only personal or corporate checks will be accepted for your initial investment. Starter checks, bank checks, credit card checks, cashier checks, travelers checks, money orders and third-party checks will not be accepted for your initial investment.

Investments by check will be credited and interest will begin to accrue on the first business day after the agent bank receives a check in proper form if the check is received prior to 9:00 a.m. Eastern time and on the

 

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second business day following receipt if the check is received after 9:00 a.m. Eastern time. Checks are accepted subject to collection at full face value in U.S. funds. Investments made by check will be available for redemption by the investor after five business days from the date the check is credited to your investment or such shorter time as may be determined from time to time at the direction of the Committee as permitted under the Dominion Energy Reliability Investment Plan.

Automatic Investment

This investment option permits you to make additional investments in the Notes by automatic monthly electronic investment. Under this alternative, the agent bank will draw funds from your pre-authorized bank account up to two times per month on regular dates designated by you, by an automated clearing house (ACH) transfer for the prescribed amount and will invest the proceeds in the Notes. Investments may be made in any amount of $50 or more.

To set up the Automatic Investment option for a new investment, you must verify your ownership of the pre-authorized bank account by completing the appropriate sections of the Application Form. For an existing investment, you may complete the Change Form or utilize the self-service feature of online access. If using the Change Form, it must be mailed to Dominion Energy Reliability Investment, P.O Box 75713, Chicago, Illinois 60675-5713, which includes providing the agent bank with a voided blank check. You may make changes to the Automatic Investment option of an investment at any time by completing the Change Form, submitted with the signature of each registered owner (including joint owners) of the Notes. A Medallion Signature Guarantee stamp may be required. Alternatively, you may utilize the self-service feature of online access. You may terminate investments by Automatic Investment of an existing investment at any time by providing notice in writing to the agent bank or by calling the agent bank toll free at 866-876-0001 from 8:30 a.m. to 7:00 p.m. Eastern time Monday through Friday. Notices to change or terminate investments by Automatic Investment will be effective as soon as practicable after they are received by the agent bank.

Electronic drafts will be presented for payment on the date you determine on your Application Form or Change Form. Investments will be credited and interest will begin to accrue on the first business day following posting of such draft by the agent bank. All such investments are accepted subject to collection at full face value in U.S. funds. Investments made through the Automatic Investment option will be available for redemption by the investor after five business days from the day the investment is posted.

Directed Investment

This investment option permits you to make additional discretionary electronic investments in the Notes. Under this alternative, the agent bank will, following your granted permission, draw funds on a non-recurring basis from your pre-authorized bank account by an ACH transfer for the prescribed amount and will invest the proceeds in the Notes. Investments may be made in any amount of $50 or more.

To set up the Directed Investment option for a new investment, you must verify your ownership of the pre-authorized bank account by completing the appropriate sections of the Application Form. For an existing investment, you may complete the Change Form or utilize the self-service feature of online access. If using the Change Form, it must be mailed to Dominion Energy Reliability Investment, P.O. Box 75713, Chicago, Illinois 60675-5713, which includes providing the agent bank with a voided blank check. You may then invest by Directed Investment by calling the agent bank at 866-876-0001 from 8:30 a.m. to 7:00 p.m. Eastern time Monday through Friday to advise them of the intent to make an investment by electronic ACH. The agent bank’s records of the telephonic instructions are binding. You may make changes to the Directed Investment option of an existing investment at any time by completing the Change Form, submitted with the signature of each registered owner (including joint owners) of the Notes. A Medallion Signature Guarantee stamp may be required. Alternatively, you may utilize the self-service feature of online access. You may terminate the Directed Investment option for an existing investment at any time by providing notice in writing to the agent bank or by calling the agent bank toll free at 866-876-0001 from 8:30 a.m. to 7:00 p.m. Eastern time Monday through

 

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Friday. Notices to change investment information will be effective as soon as practicable after they are received by the agent bank.

Investments will be credited and interest will begin to accrue on the first business day following posting of such draft by the agent bank. All such investments are accepted subject to collection at full face value in U.S. funds. Investments made through the Directed Investment option will be available for redemption by the investor after five business days from the day the investment is posted.

Wire Transfer Investment

This investment option permits you to make additional investments in Notes by wire transfer. Any investment made by wire transfer must be $1,000 or more.

You may invest by Wire Transfer Investment by calling the agent bank at 866-876-0001 from 8:30 a.m. to 7:00 p.m. Eastern time Monday through Friday to advise them of your intent to make an investment by wire transfer, at which time the agent bank will provide you transfer instructions. Wire transfer investments will only be accepted from banks domiciled in the United States and paid in U.S. dollars.

Investments made by Federal Funds wired to the agent bank will be credited as of, and interest will begin to accrue, no later than the next business day following receipt of funds by the agent bank, except that if wired funds are received by 2:00 p.m. Eastern time the funds will be credited to the investment and begin accruing interest the same day. Investments made by wire transfer will be available for redemption by the investor promptly upon being credited as described above. Neither the agent bank, nor we, will be responsible for delays in the funds wiring system.

Automatic Social Security Investment

This investment option allows you to make additional investments of part or all of your Social Security payment.

Contact your local Social Security office for the required form. Complete the form and return it to the Social Security office for processing. You may terminate the agent bank’s authority to receive your Social Security payments at any time by providing notice in writing to the Social Security office.

Automatic Social Security Investments will be credited, and interest will begin to accrue according to the provisions for Automatic Investments, above. Investments made through the Automatic Social Security Investments option will be available for redemption by the investor on the first business day following the date the investment is credited.

How to Redeem

Generally, you may redeem all or any part of your Notes without charges or penalties as more fully described below. However, you may redeem your entire investment in the Notes only by use of the Bank Check Redemption option as described in this prospectus. In such event, the principal amount of your Notes, together with accrued and unpaid interest, will be redeemed and the proceeds distributed in accordance with the procedures set forth below under Bank Check Redemption. Requests for redemption should be made by calling 866-876-0001 or directed to Dominion Energy Reliability Investment, P.O. Box 75713, Chicago, Illinois 60675-5713.

If the amount to be redeemed represents:

 

    an investment made by the Check Investment option, the redemption request will not be honored until after five business days from the date the check is credited to your investment or such shorter time as may be determined from time to time at the direction of the Committee as permitted under the Dominion Energy Reliability Investment Plan;

 

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    an investment made by the Automatic Investment or Directed Investment option from a bank account, the redemption request will not be honored until after five business days from the posting of such investment by the agent bank;

 

    an investment made by the Wire Transfer Investment option, the redemption request will be honored the same business day following receipt by the agent bank of wired funds received by 2:00 pm Eastern time and will not be honored until the next business day following receipt by the agent bank of wired funds received after 2:00 p.m. Eastern time; and

 

    an investment made by the Automatic Social Security Investment option, the redemption request will not be honored until the first business day following the posting by the agent bank of such investment, which shall be made by ACH.

If you are redeeming your entire investment in the Notes, you will receive all accrued and unpaid interest less applicable fees.

You may contact us to obtain further information on redeeming investments in the Notes by telephone at 866-876-0001 from 8:30 a.m. to 7:00 p.m. Eastern time Monday through Friday.

Check Redemption

You will be provided with an initial supply of Dominion Energy Reliability Investment redemption checks free of charge (additional supplies of Dominion Energy Reliability Investment redemption checks are also free of charge). For your protection, we will accept for redemption only Dominion Energy Reliability Investment redemption checks. You may make Dominion Energy Reliability Investment redemption checks payable to the order of anyone in the amount of $250 or more.

The payee of a Dominion Energy Reliability Investment redemption check may cash or deposit the Dominion Energy Reliability Investment redemption check like any personal check drawn on a bank. If the amount of a Dominion Energy Reliability Investment redemption check is greater than your investment balance, the Dominion Energy Reliability Investment redemption check will not be honored and will be returned to the presenter by the agent bank. In addition to having the Dominion Energy Reliability Investment redemption check returned, we will charge a fee that will be debited directly from your investment balance in the Notes. See the “Fees” section of this prospectus for a discussion of certain fees in connection with the Check Redemption option.

Check Redemption is automatically available to you and does not require any selection on the application. You may order additional Dominion Energy Reliability Investment redemption checks by using the reorder form in your current checkbook, by calling 866-876-0001, or through your account online. We will send additional redemption checks only to the registered owner(s) of the Notes and only to the registered address. The Check Redemption option does not create a checking or other bank account or a depositor or banking relationship with the agent bank or us.

Redemption will be made on the date the Dominion Energy Reliability Investment redemption check is presented to the agent bank for payment. The amount of the Note to be redeemed will continue to accrue interest to, but not including, the day the Dominion Energy Reliability Investment redemption check is presented for payment.

Bank Check Redemption

By use of the Bank Check Redemption option, you authorize the agent bank to act on written or telephone instructions to have redemption proceeds paid by a check payable to the registered owner(s) and sent to the registered address on the investment. The agent bank’s records of the telephonic instructions are binding. Neither the agent bank nor we will be responsible for the authenticity of telephonic instructions. Redemptions will be paid to you by check, in the amount of $250 or more, or the investment balance of your Notes, whichever is less.

 

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Bank Check Redemption is automatically available to you and does not require any selection on the application.

Requests for Bank Check Redemption may be made by calling 866-876-0001 from 8:30 a.m. to 7:00 p.m. Eastern time Monday through Friday. Verification of information including, but not limited to, the investment number, additional investment information and the name of the registered owner(s) submitting the Bank Check Redemption request must be provided at the time of the request. Written requests for Bank Check Redemption should be directed to Dominion Energy Reliability Investment, P.O. Box 75713, Chicago, Illinois 60675-5713. We will send the redemption payments only to the registered owner(s) of the Notes at the registered address.

A bank check representing the redemption proceeds will be made payable to the registered owners and sent to the registered address, by the end of the next business day following receipt of the redemption request and interest will accrue to, but not including, the day of your request.

ACH Redemption

Redemptions via ACH can be made in two ways:

 

    You may initiate an ACH debit through your financial institution from your investment. A minimum of $250 is required.

 

    You may set up an ACH redemption which can be executed utilizing the self-service feature of online access. A $250 minimum is required.

You can establish a bank model to complete on request ACH redemptions by submitting the information in writing on the Electronic Funds Transfer Form. Each registered must sign the request and obtain a Medallion Signature Guarantee stamp. In addition, the models must have like ownership, with the same owners on the investment as there are on the investment the funds are going to. Once the form is received, the model will be added to the investment within two business days. Once the model is complete, a confirmation is generated and sent to the registered address confirming that the transfer instructions have been established.

If you are enrolled in online access, you can use the self-service feature to establish a bank model and complete single ACH redemptions.

The agent bank will initiate the redemption from your investment and an ACH credit will be sent to the financial institution on file via a NACHA formatted transaction file. Funds are transferred to your financial institution one business day following receipt by the agent bank of the request if received by 2:00 p.m. Eastern time. The redemption will post on such day and interest will accrue to, but not including, such day. If received after 2:00 p.m. Eastern time, funds are transferred to your financial institution two business days after receipt of the request. The redemption will post on such day and interest will accrue to, but not including, such day.

Optional Redemption by Dominion Energy

As provided in the Dominion Energy Reliability Investment Plan, we have the right to redeem at any time the Notes of an investor if the investment balance is below the minimum amount or to the extent the investment balance exceeds the maximum amount as determined by the Committee. In such event, you will be notified if

 

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your Notes will be redeemed and you will be permitted 30 days within which to make such investments or make such redemptions, as the case may be, to restore the investment balance within the minimum and maximum amounts. In addition, we may also redeem, at any time at our option, the Notes of any investor who is not or is no longer eligible to invest in the Notes, who has abused or misused the investment or redemption provisions applicable to the Notes or whose investments are otherwise inconsistent with the objectives of the Dominion Energy Reliability Investment Plan, in each case as we determine in our sole judgment and discretion. In the event that we determine to redeem a particular investor’s Notes for any of the reasons specified in the preceding sentence, we will notify the investor of our intention to redeem in full the Notes on the third business day following the date of our notice. Further, we may redeem the entire amount of, or any portion of, all of the outstanding Notes. Any such partial redemption of outstanding Notes will be effected by lot or pro rata or by any other method that is deemed fair and appropriate by the agent bank. We generally will give you 30-days’ prior written notice if the Notes are to be redeemed in whole or in part. In each of the redemption transactions described above, a redemption check will be sent to the investor in an amount equal to the principal amount of the redeemed Notes, including accrued and unpaid interest and less any applicable fees.

Fees

There are no maintenance fees with respect to your investment in the Notes, nor are there charges for your redemption checks (both initial and additional) or for effecting any Check Redemptions. You may also incur a charge in obtaining any applicable signature guarantee.

Subject to revision at the discretion of the Committee, the following fee schedule applies:

 

Insufficient funds:

   $ 15  

Stop payment requests:

   $ 15  

As incurred, fees will be promptly debited directly from your investment balance as a partial redemption of your Notes.

Investor Statements

The agent bank will send a monthly statement to you, showing a summary of all the transactions made in the Notes during the previous month, including the beginning investment balance, all investments and redemptions, all interest earned, as well as any relevant fees or charges. A copy of the Dominion Energy Reliability Investment redemption checks on which payment has been made will be included in the monthly statements. This procedure is subject to change at the direction of the Dominion Energy Reliability Investment Committee in its discretion. You can obtain current information about the Notes by calling us toll free at 866-876-0001 from 8:30 a.m. to 7:00 p.m. Eastern time Monday through Friday.

You may also enroll to view your investment activity and other correspondence through the online investment management system. Many of the service options described in this prospectus are also available via this online tool. For additional information and to enroll for these online options, call us at 866-876-0001.

We will only furnish information to you by telephone if you have specified the name, address, Notes investment number, and additional investment information of the registered owner of the Notes.

Taxes

The following is a summary of the U.S. Federal income tax consequences to you if you invest in the Notes. The discussion addresses only the income tax consequences to you if you are an individual and are a citizen of the United States for Federal income tax purposes. You should consult your own tax adviser concerning the application of United States Federal income tax laws, as well as the laws of any state, local or foreign taxing jurisdictions, to your situation.

 

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The Notes are not qualified under Section 401(a) of the Internal Revenue Code, as amended. All interest credited to your Notes in any taxable year is reportable by you as taxable income for Federal income tax purposes. Early in each year the agent bank will provide to you the full amount reportable as taxable income for the previous year. The agent bank also will file tax information returns as required by law. Backup withholding may apply to you if you fail to comply with applicable tax identification requirements. Interest credited to the Notes also may be subject to state and local income taxes.

Dominion Energy Reliability Investment Committee

The Committee has the full power and authority to, among other things:

 

    amend the Dominion Energy Reliability Investment Plan and the Notes offering to the extent described below under “Termination, Suspension or Modification;”

 

    interpret the provisions of the Plan;

 

    adopt rules and regulations in connection with administration of the Plan;

 

    redeem the Notes in whole or in part at any time;

 

    redeem any investments in the Notes of an investor who has abused or misused the investment or redemption provisions applicable to the Notes, whose investments are otherwise inconsistent with the objectives of the Dominion Energy Reliability Investment Plan or who is not eligible to invest in the Notes, in each case as determined by the Committee in its sole judgment and discretion; and

 

    make certain determinations in accordance with the Dominion Energy Reliability Investment Plan, including setting the rates of interest to be paid on the Notes.

The Committee shall consist of at least three persons designated from time to time by Dominion Energy. Dominion Energy shall from time to time designate the members of the Committee and an alternate for each of such members, who shall have full power to act in the absence or inability to act of such member. As provided in the Dominion Energy Reliability Investment Plan, the Committee has delegated its authority to determine the interest rate on the Notes to the Treasurer of Dominion Energy. The address of each member of the Committee is 120 Tredegar Street, Richmond, Virginia 23219. The members of the Committee receive no additional compensation for their Committee services.

The members of the Committee may from time to time have potential conflicts of interest from the point of view of investors in the Notes. All members of the Committee to date have been, and are expected in the future to be, employees of Dominion Energy or one of its subsidiaries. All of the money you invest will be invested in the Notes, which are securities of Dominion Energy. The members of the Committee have a duty to act in Dominion Energy’s best interest, and consequently may make decisions that investors in the Notes do not believe to be in their best interest. In addition, employees of Dominion Energy and its subsidiaries, including members of the Committee, may from time to time invest in or redeem the Notes.

Under the Plan, no member of the Committee or a director, officer or employee of Dominion Energy or any of its subsidiaries will be liable for any action or failure to act under or in connection with the Plan, except for his or her own bad faith. Dominion Energy will indemnify and hold any such person harmless from all loss or expense that may be imposed upon or reasonably incurred by him or her in connection with or resulting from any claim, or proceeding, except a judgment in favor of Dominion Energy based upon a finding of his or her bad faith.

 

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AGENT BANK

The Northern Trust Company is the agent bank for the Notes. Northern Trust’s services include:

 

    maintenance of records of investments in, and redemptions of, the Notes by investors;

 

    receipt of investment and redemption requests;

 

    receipt of funds being invested in Notes and disbursement of funds upon redemption of Notes;

 

    sending notices of redemption upon a redemption at the option of Dominion Energy;

 

    transaction processing and accounting;

 

    preparation of investment statements and other correspondence to investors;

 

    investor servicing;

 

    maintenance of records of the investment balance in the Notes, accrual of interest, and payment and reinvestment of interest; and

 

    tax reporting and filing with the proper authorities.

We pay the agent bank an administrative fee for these services.

 

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DESCRIPTION OF THE NOTES

The Notes are governed by an indenture, dated as of November 1, 2017, between us and Deutsche Bank Trust Company Americas, which acts as trustee. The trustee has two main roles. First, the trustee can enforce your rights against us if we default. There are some limitations on the extent to which the trustee acts on your behalf, described below under “Events of Default and Notices.” Second, the trustee may perform certain administrative duties for us.

The indenture and its associated documents contain the full legal text of the matters described in this section. The indenture is an exhibit to our registration statement of which this prospectus is a part. See “Where You Can Find More Information” for information on how to obtain a copy of the indenture.

This section summarizes the material terms of the Notes. Because this section is a summary, it does not describe every aspect of the Notes and is subject to and qualified in its entirety by reference to all provisions of the indenture, including definitions of certain terms used in the indenture. We describe the meaning for only the more important of those terms. Whenever we refer to defined terms of the indenture in this prospectus, such defined terms are incorporated by reference here.

General

The Notes will be issuable in any amount and will mature upon your demand. The Notes will be identical except for their issue date and principal amount. We may reject any offer to purchase Notes in whole or in part. All investments in the Notes are investments in our unsecured debt obligations and are not obligations of or guaranteed by our subsidiaries, the agent bank, the trustee or any other company. Dominion Energy does not maintain reserves for its obligations under the Notes and the Notes are not subject to any sinking fund. The Notes are redeemable at your option in the manner described in this prospectus.

Following an initial investment, investors may make additional investments and redemptions from time to time as described in this prospectus. As a result, the outstanding principal amount of the Notes will increase and decrease from time to time. For purposes of determining the aggregate amount of registered but unissued notes under the registration statement relating to the Notes, each investment is an issuance of Notes, reducing the capacity of registered but unissued Notes by a corresponding amount. The daily amount and rate of redemptions are affected by many factors, including but not limited to the rates we offer on the Notes from time to time, the wide variety of alternative investment options in the market that are available to our investors and seasonal increases in redemptions and investments.

Although investors could seek to redeem a large dollar amount of Notes over a short period of time, we believe that we have sufficient capital resources available to timely fund redemptions of the Notes. Liquidity management is both a daily and long-term component of our treasury management strategy. In the event that we require funds beyond our ability to generate them internally, additional sources of funds are available to us. For more information, see the discussion of our capital resources and liquidity in our Form 10-K and 10-Q reports filed with the SEC that are incorporated by reference into this prospectus.

The Notes will rank equally in priority with all of Dominion Energy’s existing and future unsecured and non-subordinated debt and will rank senior in right of payment to all of Dominion Energy’s existing and future subordinated debt. As of September 30, 2017, Dominion Energy had approximately $16.8 billion principal amount of outstanding long-term debt on an unconsolidated basis (including securities due within one year), consisting of approximately $11.4 billion of unsecured and non-subordinated debt and $5.4 billion of unsecured junior subordinated debt. Dominion Energy is a holding company, and we operate our businesses through our subsidiaries. The Notes are structurally subordinated to the indebtedness and other liabilities of our subsidiaries. This means that in liquidation the assets of our subsidiaries would be applied first to the repayment of indebtedness and other liabilities of our subsidiaries before they would be available to pay the indebtedness and

 

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liabilities of Dominion Energy, including the Notes. As of September 30, 2017, Dominion Energy’s subsidiaries had approximately $16.9 billion principal amount of outstanding long-term debt (including securities due within one year). The indenture does not limit our ability to incur additional debt, including debt incurred by our subsidiaries. The indenture also does not restrict us from acquiring or combining with entities that have outstanding indebtedness, which entities may become subsidiaries of Dominion Energy.

The indenture does not limit the principal amount of the Notes or any of our other debt that may be issued.

The Notes will be issued in uncertificated form and you will not receive any certificate or other instrument evidencing our indebtedness. All funds you invest in the Notes, together with interest accrued thereon, and redemptions, if any, will be recorded on a register maintained by the agent bank.

The indenture provides that we, the trustee and the investors waive, to the fullest extent permitted by applicable law, any and all right to trial by jury in any legal proceeding arising out of or relating to the indenture or the Notes.

Minimum Investment

Because of the relatively high cost of maintaining small investments, we reserve the right to redeem your investment if the investment balance is less than the minimum required investment balance of $1,000 for three consecutive months. If you are an employee, the minimum required initial investment balance of $1,000 must be attained within ten months. Thereafter, the $1,000 minimum investment balance must be maintained. If the minimum investment balance is not attained or maintained, we may redeem the principal amount of your Notes, together with accrued and unpaid interest, and mail the proceeds to your registered address. You will be notified if your Notes will be redeemed and you will be permitted 60 days within which to make additional investments to increase your investment balance to the applicable minimum required investment before your investment is redeemed. The minimum required investment balance is subject to change at the discretion of the Committee without prior notice to investors.

Maximum Outstanding Investment

The Committee has established a maximum outstanding investment for any one investor of $1,250,000. If the amount of your outstanding investment exceeds the maximum for three consecutive months, we may notify you in writing that we intend to redeem the amount of your investment in excess of $1,250,000. You will then have 30 days to redeem the excess portion of your investment. If you do not do so within a 30-day period, we may redeem the amount we have specified and mail a check for the proceeds to the registered holder of the Notes, less any tax withholding, if applicable, and any other fees discussed in this prospectus. Interest on the redeemed amount shall cease to accrue on and after the effective date of the redemption. The maximum outstanding investment in the Notes for any one investor is subject to change at the discretion of the Committee without prior notice to investors.

We May Redeem the Notes at Our Option

We may also elect to redeem the entire amount of, or any portion of, the outstanding Notes. Any such partial redemption of outstanding Notes will be effected by lot or pro rata or by any other method that is deemed fair and appropriate by the agent bank. We generally will give you 30-days’ prior written notice if the Notes are to be redeemed in whole or in part. As discussed above, we may also redeem your Notes if your investment balance is below the minimum amount or exceeds the maximum amount as determined by the Committee.

In addition, as provided in the Dominion Energy Reliability Investment Plan, we may also redeem, at any time at our option, the Notes of any investor who is not or is no longer eligible to invest in the Notes, who has abused or misused the investment or redemption provisions applicable to the Notes or whose investments are

 

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otherwise inconsistent with the objectives of the Dominion Energy Reliability Investment Plan, in each case as we determine in our sole judgment and discretion. In the event that we determine to redeem a particular investor’s Notes for any of these reasons, we will notify the investor of our intention to redeem in full the Notes on the third business day following the date of our notice.

In each of the redemption transactions initiated by us, as described above, a redemption check will be sent to the investor in an amount equal to the principal amount of the redeemed Notes, including accrued and unpaid interest and less any applicable fees. Interest on the redeemed amount shall cease to accrue on and after the effective date of redemption.

The Trustee

The indenture contains certain limitations on the right of the trustee, as a creditor of ours, to obtain payment of claims in certain cases, or to realize on certain property received in respect of any such claim as security or otherwise. In addition, the trustee may be deemed to have a conflicting interest and may be required to resign as trustee if at the time of a default under the indenture it is a creditor of ours.

Deutsche Bank Trust Company Americas is the trustee under the indenture. Dominion Energy and certain of its affiliates maintain banking relationships with Deutsche Bank Trust Company Americas or its affiliates. Deutsche Bank Trust Company Americas also serves as trustee or agent under other indentures and agreements pursuant to which securities of Dominion Energy and of certain of its affiliates are outstanding.

Events of Default and Notices

The following events are defined in the indenture as “events of default” with respect to the Notes:

 

    failure to pay any or all the principal of or interest on any Note when due, provided that the failure to pay shall not be deemed to be an event of default under various circumstances, such as when the person demanding payment is not legally entitled to it or upon the occurrence of certain administrative errors; and

 

    failure to perform any of our covenants in the indenture, which continues for 60 days after we are given written notice by either the trustee or at least a majority of the holders in principal amount of the Notes outstanding and affected thereby.

If an event of default with respect to the outstanding Notes occurs and is continuing, either the trustee or the holders of at least a majority in principal amount of the outstanding Notes may declare the principal amount of all Notes to be due and payable immediately; provided, however, that under certain circumstances the holders of a majority in aggregate principal amount of outstanding Notes may rescind and annul such declaration and its consequences.

The indenture provides that the trustee, within 90 days after the occurrence of a default with respect to the Notes, shall give to the holders of the Notes notice of all uncured defaults known to it (the term “default” means the events specified above without grace periods), provided that, except in the case of default in the payment of principal of or interest, if any, on any Notes, the trustee shall be protected in withholding the notice if it in good faith determines that the withholding of the notice is in the interest of the holders of Notes.

We will be required to furnish annually to the trustee a statement by certain of our officers to the effect that to their knowledge we are not in default in the fulfillment of any of our obligations under the indenture or, if there has been a default in the fulfillment of any of our obligations, specifying each such default.

The holders of a majority in principal amount of the outstanding Notes will have the right, subject to certain limitations, to direct the time, method and place of conducting any proceeding for any remedy available to the trustee, or exercising any trust or power conferred on the trustee with respect to the Notes, and to waive certain defaults.

 

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The indenture provides that in case an event of default occurs and is continuing, the trustee shall exercise such of its rights and powers under the indenture, and use the same degree of care and skill in their exercise, as a prudent man would exercise or use under the circumstances in the conduct of his own affairs. Subject to such provisions, the trustee will be under no obligation to exercise any of its rights or powers under the indenture at the request or direction of any of the holders of Notes unless they shall have offered to the trustee reasonable security or indemnity against the costs, expenses and liabilities which the trustee might incur in complying with the request or direction.

Modification of the Indenture

We and the trustee may modify or amend the indenture, with the consent of the holders of not less than a majority in aggregate principal amount of the outstanding Notes issued under the indenture, provided that no such modification or amendment may, without the consent of each holder of the Notes that are affected:

 

    change the character of the Notes from being payable on demand or reduce the principal amount of any Note;

 

    impair the right to institute a suit for the enforcement of any payment on or with respect to any Note;

 

    reduce the above-stated percentage of holders of Notes necessary to modify or amend the indenture; or

 

    modify the foregoing requirements or reduce the percentage of outstanding Notes necessary to waive compliance with certain provisions of the indenture or for waiver of certain defaults.

We may also amend the indenture, without the consent of any holders of the Notes, to add covenants or restrictions for your benefit or to make other changes that do not adversely affect the rights of any holder in any material respect.

 

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TERMINATION, SUSPENSION OR MODIFICATION

We expect that you will be able to invest in the Notes for the foreseeable future, but we reserve the right at any time to terminate, to suspend or from time to time to modify the Plan and the Notes offering in part, in its entirety or in respect of investors located in one or more states or other jurisdictions or to suspend new investments in the Notes. We reserve the right to modify, suspend or terminate any of the investment options and redemption options described under “Dominion Energy Reliability Investment—How to Make an Investment,” “—Investment Options” and “—How to Redeem.” No termination, modification or suspension shall affect your rights unless the proposed action shall have been communicated to you in sufficient time prior to its effective date to allow you to redeem Notes together with accrued and unpaid interest in accordance with the terms in effect prior to the effective date of such termination, modification or suspension. No such termination or modification of the Plan or suspension or any provision in the Plan may diminish the principal of any Note or unpaid interest on any Note. Any modification that affects the rights or duties of the trustee may be made only with the consent of the trustee.

The indenture shall cease to be of further effect, and the trustee, on our demand and at our cost and expense, shall execute proper instruments acknowledging satisfaction of and discharging the indenture if at any time we shall have terminated the Plan pursuant to its provisions, all of the Notes shall have become due and payable, we shall have deposited or caused to be deposited with the trustee as trust funds the entire amount sufficient to pay all the outstanding Notes, including principal and interest due or to become due to such date of maturity or, if we shall have given notice for the full redemption of all outstanding Notes, the date of redemption, and we shall have paid or caused to be paid all other sums payable by us under the indenture.

 

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RIGHTS MAY NOT BE ASSIGNED, TRANSFERRED OR PLEDGED

Except for redemptions, and except for the right to debit amounts credited in error to investment balances, there is no provision in the Plan, in the indenture or in our arrangements with the agent bank under which any person has or may create any lien on amounts credited to your investment balance in the Notes. You may not assign, transfer or pledge rights under the Notes, except upon redemption.

 

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PLAN OF DISTRIBUTION

We have engaged Georgeson Securities Corporation (GSC) to assist us with the offering of the Notes as an accommodating broker in states where applicable securities laws require such offerings to be made by a registered broker-dealer. GSC is a registered broker-dealer in all fifty U.S. states. GSC is not underwriting the Notes, has no obligation to purchase any Notes and is not obligated to find or qualify purchasers of the Notes. GSC has not prepared a report or opinion constituting recommendations or advice to us in connection with the Notes. In addition, GSC does not make any recommendations as to whether any investor should purchase the Notes. No commissions will be paid to GSC. We will pay GSC an annual administrative fee of $17,500 for its services with respect to the Notes. In certain jurisdictions, we are offering the Notes on a continuing basis directly on our behalf. We may also from time to time designate other agents through whom Notes may be offered. We reserve the right to withdraw, cancel or modify the offer to purchase Notes at any time. We have the sole right to accept offers to purchase Notes and may reject any proposed purchase of Notes in whole or in part.

 

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VALIDITY OF NOTES

The validity of the Notes will be passed upon for Dominion Energy, Inc. by McGuireWoods LLP, counsel to the Company.

EXPERTS

The consolidated financial statements incorporated in this Prospectus by reference from Dominion Energy, Inc.’s Annual Report on Form 10-K and the effectiveness of the Dominion Energy, Inc. and subsidiaries’ internal control over financial reporting have been audited by Deloitte & Touche LLP, an independent registered public accounting firm, as stated in their reports, which are incorporated herein by reference. Such consolidated financial statements have been so incorporated in reliance upon the reports of such firm given upon their authority as experts in accounting and auditing.

 

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For information regarding:

Rates and Other Information

866-876-0001

An additional Prospectus

866-876-0001

or download from:

www.sec.gov

Dominion Energy

See our website at

www.dominionenergy.com or

see “Where You Can Find More

Information” on page 1 hereof.

 

LOGO

Dominion Energy, Inc.

Variable Denomination Floating Rate

Demand Notes

 

 

Prospectus

 

 

November 2, 2017

Distributed by Georgeson Securities Corporation,

a registered broker-dealer.

 

 

 

 

 

 

 

 

 


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Part II

INFORMATION NOT REQUIRED IN PROSPECTUS

 

Item 14. Other Expenses of Issuance and Distribution.

The following is an itemized statement of estimated expenses of Dominion Energy in connection with the issue of the Notes:

 

SEC filing fee

   $ 124,500  

Fees and expenses of agent bank

   $ 120,000  

Fees and expenses of trustee

   $ 5,000  

Printing expenses

   $ 5,000  

Accountants’ fees and expenses

   $ 17,500  

Counsel fees and expenses

   $ 30,000  

Miscellaneous

   $ 17,500  
  

 

 

 

Total

   $ 319,500  
  

 

 

 

 

Item 15. Indemnification of Directors and Officers.

Article VI of Dominion Energy’s Articles of Incorporation mandates indemnification of its directors and officers to the full extent permitted by the Virginia Stock Corporation Act (the Virginia Act) and any other applicable law. The Virginia Act permits a corporation to indemnify its directors and officers against liability incurred in all proceedings, including derivative proceedings, arising out of their service to the corporation or to other corporations or enterprises that the officer or director was serving at the request of the corporation, except in the case of willful misconduct or a knowing violation of a criminal law. Dominion Energy is required to indemnify its directors and officers in all such proceedings if they have not violated this standard. Dominion Energy has also entered into agreements relating to the advancement of expenses for certain of its directors and officers in advance of a final disposition of proceedings or the making of any determination of eligibility for indemnification pursuant to Dominion Energy’s Articles of Incorporation.

In addition, Article VI of Dominion Energy’s Articles of Incorporation limits the liability of its directors and officers to the full extent permitted by the Virginia Act as now and hereafter in effect. The Virginia Act places a limit on the liability of a director or officer in derivative or shareholder proceedings equal to the lesser of (i) the amount specified in the corporation’s articles of incorporation or a shareholder-approved bylaw; or (ii) the greater of (a) $100,000 or (b) twelve months of cash compensation received by the director or officer. The limit does not apply in the event the director or officer has engaged in willful misconduct or a knowing violation of a criminal law or a federal or state securities law. The effect of Dominion Energy’s Articles of Incorporation, together with the Virginia Act, is to eliminate liability of directors and officers for monetary damages in derivative or shareholder proceedings so long as the required standard of conduct is met.

Dominion Energy has purchased directors’ and officers’ liability insurance policies. Within the limits of their coverage, the policies insure (1) the directors and officers of Dominion Energy against certain losses resulting from claims against them in their capacities as directors and officers to the extent that such losses are not indemnified by Dominion Energy and (2) Dominion Energy to the extent that it indemnifies such directors and officers for losses as permitted under the laws of Virginia.

The Dominion Energy Reliability Investment Plan provides for the indemnification of officers and directors of Dominion Energy under certain circumstances.

 

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Item 16. Exhibits.

 

Exhibit No.    Description of Document
  4.1    Dominion Energy Reliability Investment Plan, dated as of November 2, 2017 (filed herewith).
  4.2    Indenture, dated as of November 1, 2017, between Dominion Energy, Inc. and Deutsche Bank Trust Company Americas, as Trustee (filed herewith).
  5.1    Opinion of McGuireWoods, LLP, counsel to Dominion Energy, Inc., with respect to the Notes (filed herewith).
12    Computation of Ratio of Earnings to Fixed Charges (incorporated by reference from Exhibit 12.1 to the Company’s Quarterly Report on Form 10-Q for the fiscal quarter ended September 30, 2017, File No. 1-8489).
23.1    Consent of McGuireWoods LLP (contained in Exhibit 5.1).
23.2    Consent of Deloitte & Touche LLP (filed herewith).
24    Powers of Attorney (included herein).
25.1    Statement of Eligibility of Deutsche Bank Trust Company Americas with respect to the Indenture dated as of November 1, 2017 relating to the Notes (filed herewith).

 

Item 17. Undertakings.

(a) The undersigned registrant hereby undertakes:

(1) To file, during any period in which offers or sales are being made, a post-effective amendment to this registration statement:

(i) To include any prospectus required by Section 10(a)(3) of the Securities Act of 1933;

(ii) To reflect in the prospectus any facts or events arising after the effective date of the registration statement (or the most recent post-effective amendment thereof) which, individually or in the aggregate, represent a fundamental change in the information set forth in the registration statement. Notwithstanding the foregoing, any increase or decrease in volume of securities offered (if the total dollar value of securities offered would not exceed that which was registered) and any deviation from the low or high end of the estimated maximum offering range may be reflected in the form of prospectus filed with the Securities and Exchange Commission pursuant to Rule 424(b) if, in the aggregate, the changes in volume and price represent no more than 20 percent change in the maximum aggregate offering price set forth in the “Calculation of Registration Fee” table in the effective registration statement;

(iii) To include any material information with respect to the plan of distribution not previously disclosed in the registration statement, or any material change to such information in the registration statement;

provided, however, that paragraphs (i), (ii) and (iii) do not apply if the registration statement is on Form S-3 or Form F-3 and the information required to be included in a post-effective amendment by those paragraphs is contained in periodic reports filed with or furnished to the Securities and Exchange Commission by the registrant pursuant to Section 13 or Section 15(d) of the Securities Exchange Act of 1934 that are incorporated by reference in the registration statement, or is contained in a form of prospectus filed pursuant to Rule 424(b) that is part of the registration statement.

(2) That, for the purpose of determining any liability under the Securities Act of 1933, each such post-effective amendment shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof.

 

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(3) To remove from registration by means of a post-effective amendment any of the securities being registered that remain unsold at the termination of the offering.

(4) That, for the purpose of determining liability under the Securities Act of 1933 to any purchaser:

(i) Each prospectus filed by the registrant pursuant to Rule 424(b)(3) shall be deemed to be part of the registration statement as of the date the filed prospectus was deemed part of and included in the registration statement; and

(ii) Each prospectus required to be filed pursuant to Rule 424(b)(2), (b)(5) or (b)(7) as part of a registration statement in reliance on Rule 430B relating to an offering made pursuant to Rule 415(a)(1)(i), (vii) or (x) for the purpose of providing the information required by Section 10(a) of the Securities Act shall be deemed to be part of and included in the registration statement as of the earlier of the date such form of prospectus is first used after effectiveness or the date of the first contract of sale of securities in the offering described in the prospectus. As provided in Rule 430B, for liability purposes of the issuer and any person that is at that date an underwriter, such date shall be deemed to be a new effective date of the registration statement relating to the securities in the registration statement to which that prospectus relates, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof. Provided, however, that no statement made in a registration statement or prospectus that is part of the registration statement or made in a document incorporated or deemed incorporated by reference into the registration statement or prospectus that is part of the registration statement will, as to a purchaser with a time of contract of sale prior to such effective date, supersede or modify any statement that was made in the registration statement or prospectus that was part of the registration statement or made in any such document immediately prior to such effective date.

(5) That, for the purpose of determining liability of the registrant under the Securities Act of 1933 to any purchaser in the initial distribution of the securities the undersigned registrant undertakes that in a primary offering of securities of the undersigned registrant pursuant to this registration statement, regardless of the underwriting method used to sell the securities to the purchaser, if the securities are offered or sold to such purchaser by means of any of the following communications, the undersigned registrant will be a seller to the purchaser and will be considered to offer or sell such securities to such purchaser:

(i) Any preliminary prospectus or prospectus of the undersigned registrant relating to the offering required to be filed pursuant to Rule 424;

(ii) Any free writing prospectus relating to the offering prepared by or on behalf of the undersigned registrant or used or referred to by the undersigned registrant;

(iii) The portion of any other free writing prospectus relating to the offering containing material information about the undersigned registrant or its securities provided by or on behalf of the undersigned registrant; and

(iv) Any other communication that is an offer in the offering made by the undersigned registrant to the purchaser.

(b) The undersigned registrant hereby further undertakes that, for purposes of determining any liability under the Securities Act of 1933, each filing of the registrant’s annual report pursuant to Section 13(a) or Section 15(d) of the Securities Exchange Act of 1934 that is incorporated by reference in the registration statement shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof.

(c) Insofar as indemnification for liabilities arising under the Securities Act of 1933 may be permitted to directors, officers and controlling persons of the registrant pursuant to the provisions described under Item 15 in the registration statement above, or otherwise, the registrant has been advised that in the opinion of the Securities and Exchange Commission such indemnification is against public policy as expressed in the Act and is, therefore, unenforceable. In the event that a claim for indemnification against such liabilities

 

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(other than the payment by the registrant of expenses incurred or paid by a director, officer or controlling person of the registrant in the successful defense of any action, suit or proceeding) is asserted against the registrant by such director, officer or controlling person in connection with the securities being registered, the registrant will, unless in the opinion of its counsel the matter has been settled by controlling precedent, submit to a court of appropriate jurisdiction the question whether such indemnification by it is against public policy as expressed in the Act and will be governed by the final adjudication of such issue.

 

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SIGNATURES

Pursuant to the requirements of the Securities Act of 1933, the Registrant certifies that it has reasonable grounds to believe that it meets all of the requirements for filing on Form S-3 and has duly caused this Registration Statement to be signed on its behalf by the undersigned, thereunto duly authorized, in the City of Richmond, the Commonwealth of Virginia, on the 2nd day of November, 2017.

 

Dominion Energy, Inc.
By:  

/s/ Thomas F. Farrell, II

  Thomas F. Farrell, II
  Chairman, President and Chief Executive Officer

Pursuant to the requirements of the Securities Act of 1933, this Registration Statement has been signed below by the following persons in the capacities stated below and on the 2nd day of November, 2017. The officers and directors whose signatures appear below hereby constitute Carlos M. Brown, Carter M. Reid, or Karen W. Doggett, any one of whom may act, as their true and lawful attorneys-in-fact, with full power to sign on their behalf individually and in each capacity stated below and file all amendments and post-effective amendments to the registration statement making such changes in the registration statement as the registrant deems appropriate, and file any registration statement registering additional securities, and generally to do all things in their name in their capacities as officers and directors to enable the registrant to comply with the provisions of the Securities Act of 1933 and all requirements of the Securities and Exchange Commission.

 

Signature

  

Title

 

Date

/s/ Thomas F. Farrell, II

Thomas F. Farrell, II

   Chairman of the Board of Directors, President and Chief Executive Officer (Principal Executive Officer)   November 2, 2017

/s/ William P. Barr

William P. Barr

   Director   November 2, 2017

/s/ Helen E. Dragas

Helen E. Dragas

   Director   November 2, 2017

/s/ James O. Ellis, Jr.

James O. Ellis, Jr.

   Director   November 2, 2017

/s/ John W. Harris

John W. Harris

   Director   November 2, 2017

/s/ Ronald W. Jibson

Ronald W. Jibson

   Director   November 2, 2017

/s/ Mark J. Kington

Mark J. Kington

   Director   November 2, 2017

/s/ Joseph M. Rigby

Joseph M. Rigby

   Director   November 2, 2017

 

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Signature

  

Title

 

Date

/s/ Pamela J. Royal

Pamela J. Royal

   Director   November 2, 2017

/s/ Robert H. Spilman, Jr.

Robert H. Spilman, Jr.

   Director   November 2, 2017

/s/ Susan N. Story

Susan N. Story

   Director   November 2, 2017

/s/ Michael E. Szymanczyk

Michael E. Szymanczyk

   Director   November 2, 2017

/s/ Mark F. McGettrick

Mark F. McGettrick

   Executive Vice President and Chief Financial Officer (Principal Financial Officer)   November 2, 2017

/s/ Michele L. Cardiff

Michele L. Cardiff

   Vice President, Controller and Chief Accounting Officer (Principal Accounting Officer)   November 2, 2017

 

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EX-4.1

Exhibit 4.1

DOMINION ENERGY RELIABILITY INVESTMENT PLAN

This Dominion Energy Reliability Investment Plan (the “Plan”) is established by Dominion Energy, Inc. (the “Company”) as of November 2, 2017. The Plan was established to provide eligible investors with a convenient means of making investments in Variable Denomination Floating Rate Demand Notes of the Company.

 

I. Definitions

As hereinafter used:

“Application” shall have the meaning set forth in paragraph IV hereof.

“Agent Bank” shall have the meaning set forth in paragraph IX hereof.

“Business Day” shall mean any day other than a Saturday or a Sunday or a day on which the Agent Bank is authorized or obligated by law to close.

“Committee” shall mean the Dominion Energy Reliability Investment Committee created by the Company pursuant to paragraph X hereof.

“Company” shall mean Dominion Energy, Inc., a Virginia corporation, and, as applicable, its subsidiaries.

“Eligible Investor” shall mean any person designated by the Committee as eligible to invest in the Notes pursuant to paragraph II hereof.

“Immediate Family Member” shall mean, with respect to any person, such person’s spouse and dependent children (as defined for Federal income tax purposes).

“Indenture” shall have the meaning set forth in paragraph VIII hereof.

“Investor” shall mean any Eligible Investor having established a Plan Investment.

“Note Register” shall have the meaning set forth in paragraph IV hereof.

“Notes” shall mean the nontransferable Variable Denomination Floating Rate Demand Notes of the Company issued pursuant to and in accordance with the terms, conditions and provisions of the Indenture, as in effect from time to time.

“Plan” shall mean the Dominion Energy Reliability Investment Plan.

“Plan Investment” shall mean an investment established and maintained pursuant to the Plan and recorded on the Note Register.

“Plan Investment Note Balance” shall have the meaning set forth in paragraph IV hereof.

“Registered Investment Address” shall have the meaning set forth in paragraph IV hereof.

“Registered Investment Owner” shall mean (a) in the case of an individual Plan Investment, the Investor or (b) in the case of a joint Plan Investment, the Investor and the Immediate Family Members who have been designated by the Investor as having a joint interest in the Plan Investment, (c) in the case of a custodial Plan Investment, the Investor, as custodian, or (d) in the case of a trust Plan Investment established for the benefit of an Investor or for the benefit of an Immediate Family Member of an Investor, the trust, or, if such Investor is a joint owner of the Plan Investment with the trust, the Investor and the trust, all as recorded on the Note Register.

“Trustee” shall have the meaning set forth in paragraph VIII hereof.

 

II. Eligibility

(a) Except as hereinafter provided, any person may invest in the Notes issued pursuant to the Plan, provided such person is a citizen of the United States or, except as provided in applicable United States Treasury Regulations, a partnership, a corporation incorporated or established in or under the laws of the United States or a Trust or estate that is treated as a United States person under Section 7701 of the Internal Revenue Code, as amended.

 

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(b) The Committee may from time to time in its sole discretion limit or expand the categories of persons who shall be eligible to invest in the Notes subject to such limitations or regulations as the Committee from time to time may prescribe.

 

III. Participation

Participation in the Plan shall be entirely voluntary. An Eligible Investor may elect to participate in the Plan by delivering to the Company or to the Agent Bank, as designated by the Committee from time to time, a properly completed Application, and delivering to the Company and/or to the Agent Bank such other forms and undertakings as may be designated by the Committee from time to time.

 

IV. Establishment of Plan Investments—Note Register

Plan Investments shall be established by the Eligible Investor delivering to the Company or to the Agent Bank, as the Committee from time to time may designate, a properly executed application (the “Application”), which shall require such information and provide such elections as the Committee from time to time may determine, together with such other forms and undertakings as may be designated by the Committee from time to time.

Subject to such limitations or regulations as the Committee from time to time may prescribe, each Eligible Investor may establish and maintain one or more of the following types of investments: individual investments, joint investments with Immediate Family Members, trust investments established for the benefit of an Eligible Investor, trust investments established for the benefit of an Immediate Family Member, and custodial investments for an Immediate Family Member pursuant to the applicable Uniform Gifts to Minors Act of the state in which the Eligible Investor resides. In the case of any trust investment, the income of such trust must be subject to U.S. Federal income taxation regardless of its source.

The Company, the Agent Bank or another agent designated by the Company shall maintain a listing (the “Note Register”) setting forth such information regarding each Plan Investment as the Committee from time to time may determine, including but not limited to the name of the Investor, such Investor’s social security number or taxpayer identification number, the names of other Registered Investment Owners, if any, the address to which notices under the Plan are to be sent (the “Registered Investment Address”), the amounts credited to the Plan Investment and the amount of Notes redeemed by such Investor from time to time (the “Plan Investment Note Balance”) and accrued and unpaid interest on the Plan Investment Note Balance.

 

V. Investment Under the Plan—Issuance of Notes

The Notes shall be issued under the Indenture between the Company and the Trustee, as amended or supplemented from time to time in accordance with the terms thereof.

The principal amount of Notes issued to an Investor under the Plan shall at all times be equal to the Plan Investment Note Balance in such Investor’s Plan Investment and shall bear interest from time to time at the rate provided for in paragraph VI hereof.

The Committee may designate from time to time methods of making investments under the Plan which shall be subject to such limitations and requirements as the Committee may determine.

 

VI. Interest Rate

Each Note shall bear interest from time to time at a floating rate per annum to be determined by the Committee on a weekly basis to be effective on the following Monday. Such rate of interest will be determined by the Committee in the manner and on the basis chosen by the Committee in its sole discretion. The Committee may delegate the authority to set the interest rate on the Notes to the Treasurer of the Company or such other person or persons as the Committee determines in its sole discretion.

 

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Interest on each Note shall accrue and be compounded daily based on a 365/366-day year. Accrued interest shall be automatically reinvested in the Notes as of the last day of each calendar month.

 

VII. Redemption of Notes—Termination of Plan Investments

(a) Subject to the provisions of this paragraph VII, Registered Investment Owners may redeem all or part of the principal amount of the Note evidencing amounts invested by the Registered Investment Owner in the Notes at any time and from time to time by written request to the Agent Bank for redemption by check (subject to such minimum redemption amounts, fees and other limitations and requirements as the Committee may determine). The Committee may designate from time to time other methods of redemption of the Notes by the Registered Investment Owners under the Plan which shall be subject to such limitations and requirements as the Committee may determine.

A Registered Investment Owner may elect voluntarily to terminate participation in the Plan and close such Registered Investment Owner’s Plan Investment by written or telephonic notice to the Agent Bank. Upon election by the Registered Investment Owner to terminate participation in the Plan, all amounts credited to the principal amount of the Notes held by such Registered Investment Owner, together with accrued and unpaid interest to but not including the Business Day next following the effective date of such termination, less applicable fees, shall be paid by check to the Registered Investment Owner as such Owner’s interests shall appear at the Registered Investment Address.

(b) The Company shall have the right to redeem, at any time at its option, including in the event the Plan is modified, suspended or terminated pursuant to paragraph XIII hereof, all or any part of the Notes. Any partial redemption of the Notes will be effected by lot or pro rata or by any other method that is deemed fair and appropriate by the Agent Bank. Interest on the redeemed amount shall cease to accrue on and after the effective date on which the redeemed principal amount shall have become due and payable.

(c) With respect to any Plan Investment which shall have a Plan Investment Note Balance of less than $1,000 (or such other amount as the Committee from time to time may determine without any prior notice to the Investors) (the “Minimum Investment Note Balance”) and to which no investment shall have been made (other than the crediting of interest thereto pursuant to the provisions of paragraph VI hereof) for a continuing period of three calendar months immediately preceding determination of such deficiency (or such other period as the Committee from time to time may determine), the Company shall have the right, after 60 days following the date of a written notice to the Investor (provided that the Plan Investment Note Balance shall not have been restored to the Minimum Investment Note Balance during such 60-day period), to terminate such Investor’s investment in the Notes and to redeem the principal amount of the Notes together with accrued and unpaid interest thereon less applicable fees. In the event of such a redemption, the Company shall cause the Agent Bank to mail the proceeds thereof to the Registered Investment Owner as such Registered Investment Owner’s registered interests shall appear at the Registered Investment Address and to terminate the Plan Investment. Interest on the redeemed amount shall cease to accrue on and after the effective date on which the redeemed principal amount shall have become due and payable. With respect to any Plan Investment which shall have a Plan Investment Note Balance of greater than $1,250,000 (or such other amount as the Committee from time to time may determine without any prior notice to the Investors) (the “Maximum Investment Note Balance”) for a continuing period of three calendar months immediately preceding the determination of such excess (or such other period as the Committee from time to time may determine), the Company shall have the right, after 30 days following the date of a written notice to the Investor (provided that the Plan Investment Note Balance shall not have been reduced to be equal to or less than the Maximum Investment Note Balance during such 30-day period), to redeem the principal amount of the Notes in excess of the Maximum Investment Note Balance (or such greater amount as specified by the Committee in the notice to the Investor) together with accrued and unpaid interest thereon, less applicable fees. In the event of such a redemption, the Company shall cause the Agent Bank to mail the proceeds thereof to the Registered Investment Owner as such Registered Investment Owner’s registered interests shall appear at the Registered Investment Address. Interest on the redeemed principal amount shall cease to accrue on and after the effective date on which the redeemed principal amount shall have become due and payable.

The Company shall have the right to redeem any Notes of any Investor who is not or is no longer eligible to invest in the Notes in accordance with Part II hereof, or who has abused or misused the investment or redemption provisions applicable to the Notes or whose investments are otherwise inconsistent with the objectives of the Plan, in each case as the Company determines in its sole judgment and discretion. In such circumstances, the Company

 

3


shall notify the Registered Investment Owner of its intention to redeem in full the Notes on the third Business Day following the date of the Company’s notice. In the event of such a redemption, the Company shall cause the Agent Bank to mail the proceeds thereof to the Registered Investment Owner as such Registered Investment Owner’s registered interests shall appear at the Registered Investment Address. Interest on the redeemed principal amount shall cease to accrue on and after the effective date on which the redeemed principal amount shall have become due and payable.

The Company shall have the right to redeem from time to time, without prior notice to any Investor, all or a portion of the Notes of an Investor in an amount equal to any applicable fees established under the Plan that are then owed by such Investor. In such instance, the redemption proceeds shall be deemed paid by reducing the principal amount of such Investor’s Notes by the amount of such unpaid fees, which reduction shall be applied to the payment of such fees. Such redemption shall be effective upon notice from the Company to the Agent Bank, and the date of such notice shall be the effective date for the redemption of such amount of the Notes. On the effective date of such a redemption any interest on the portion of the Notes so called for redemption shall cease to accrue. Notice of such redemptions shall be provided to the Registered Investment Owner of the Notes so redeemed in the manner and at the times as determined from time to time by the Committee.

 

VIII. Trustee

The Company shall appoint one or more banks, corporations or other entities to act as trustee (the “Trustee”) for Notes issued pursuant to the Plan and shall enter into an indenture (the “Indenture”) with such bank, corporation or other entity which meets the requirements of the Trust Indenture Act of 1939. Subject to the requirements of the Indenture, the Company and the Trustee may amend or supplement the Indenture from time to time.

 

IX. Agent Bank

The Company shall appoint one or more banks, corporations or other entities to act as agent under the Plan (the “Agent Bank”) and at any time may remove the Agent Bank and appoint a successor Agent Bank. The Committee may, without reference to or any action by any Investor or other Registered Investment Owner, enter into such agreement or further agreements and take such other steps and execute such other instruments as the Company in its sole discretion may deem necessary or desirable to carry the Plan into effect or to facilitate its administration.

 

X. Committee

The Company’s Board of Directors has authorized the establishment of a Dominion Energy Reliability Investment Committee (the “Committee”) consisting of at least three persons. The Committee shall initially consist of the Chief Financial Officer, the Treasurer and two Assistant Treasurers. The Treasurer of the Company shall from time to time designate an alternate for each of such members, who shall have full power to act in the absence or inability to act of such member. The Committee shall act by a majority of its members, with or without a meeting.

The Committee shall have full power and authority to administer the Plan, to interpret its provisions, to adopt forms for use thereunder, to adopt rules and regulations in connection therewith and to make the determinations thereunder provided for it to be made. Any interpretation of the provisions of the Plan by the Committee shall be final and conclusive, and shall bind and may be relied on by all parties in interest to the Plan.

No member of the Committee or alternate for a member or a director, officer or employee of the Company shall be liable for any action or failure to act under or in connection with the Plan, except for his or her own bad faith. Each director, officer or employee of the Company who is or shall have been designated to act on behalf of the Company and each person who is or shall have been a member of the Committee or an alternate for a member or a director, officer or employee of the Company, as such, shall be indemnified and held harmless by the Company against and from any and all loss, cost, liability or expense that may be imposed upon or reasonably incurred by him or her in connection with or resulting from any claim, action, suit or proceeding to which he or she may be a party or in which he or she may be involved by reason of any action taken or failure to act under the Plan and against and from any and all amounts paid by him or her in settlement thereof (with the Company’s written approval) or paid by him or her in satisfaction of a judgment in any such action, suit or proceeding, except a judgment in favor of the Company based upon a finding of his or her bad faith subject, however, to the condition that, upon the assertion or institution of any such claim, action, suit or proceeding against him or her, he or she shall in writing give the Company an opportunity, at its own expense, to handle and defend the same before he or she undertakes to handle

 

4


and defend it on his or her own behalf. The foregoing right of indemnification shall not be exclusive of any other right to which such person may be entitled as a matter of law or otherwise, or any power that the Company may have to indemnify him or her or hold him or her harmless.

 

XI. Plan Investment Statements

On approximately the last day of each calendar month (or such other date as the Committee shall determine), there shall be furnished with respect to each Plan Investment a statement setting forth a summary of all transactions in such Plan Investment during the previous month, including beginning and ending Plan Investment Balances, interest credited, and such additional information as the Committee from time to time may determine. Such statements shall be deemed to have been accepted by the Investor and other Registered Investment Owners as correct unless written notice to the contrary shall be received by the Agent Bank within 30 days after the mailing of such statement to the Registered Investment Address.

 

XII. Notices, etc.

All notices, statements and other communications from the Agent Bank or the Company to an Investor, other Registered Investment Owner or designated beneficiary shall be deemed to have been duly given, furnished, delivered or transmitted, as the case may be, when delivered to (or when mailed to) the most recent Registered Investment Address.

All notices, instructions and other communications from an Investor or other Registered Investment Owner to the Company or Agent Bank required or permitted hereunder (including without limitation Applications and redemption requests) shall be in the respective forms from time to time prescribed therefor by the Committee, shall be mailed by first-class mail or delivered to such location as shall be specified by and upon forms prescribed by the Committee and shall be deemed to have been duly given and delivered upon receipt by the Company or the Agent Bank, as the case may be, at such location.

From time to time as necessary to facilitate the administration of the Plan, the Company, the Agent Bank, the Trustee and the Committee shall deliver to each other copies or consolidations of such notices, instructions or other communications in respect of the Plan as it may receive from Investors or Registered Investment Owners.

 

XIII. Termination, Suspension and Modification

The Company may terminate the Plan at any time or from time to time suspend or modify the Plan, in part, in its entirety or in respect of the employees of the Company or in respect of any person or persons designated as Eligible Investors. The Company may at any time or from time to time terminate or modify the Plan or suspend for any period the operation of any provision thereof in respect of any Investors located in one or more jurisdictions. Any such termination, modification or suspension of the Plan may affect Investors in the Plan at the time thereof, as well as future Investors, but may not affect the rights of an Investor unless such proposed action shall have been communicated to such Investor in sufficient time prior to the effective date thereof to permit such Investor to redeem amounts credited to his or her Plan Investment together with accrued and unpaid interest in accordance with the terms of the Plan in effect prior to the effective date of such termination, modification or suspension. The Company shall notify the Trustee promptly after any such termination, modification or suspension of the Plan. Any modification that adversely affects the rights or duties of the Trustee may be made only with the consent of the Trustee.

Anything herein to the contrary notwithstanding, no such termination or modification of the Plan or suspension or any provision thereof may diminish the principal amount of any Note, or such Investor’s unpaid interest thereon.

 

XIV. Rights Not Transferable

Except in the case of (i) Note redemptions in accordance with paragraph VII hereof, and (ii) the establishment and subsequent termination of joint, custodial and trust Plan Investments, no right or interest of any Investor or other Registered Investment Owner under the Plan or in such Investor’s Plan Investment or the Notes issued in connection therewith shall be assignable or transferable, in whole or in part, either directly or by operation of law or otherwise,

 

5


including without limitation by execution, levy, garnishment, attachment, pledge or in any other manner, but excluding devolution by death or mental incompetency; no attempted assignment or transfer thereof shall be effective; and no right or interest of any Investor, other Registered Investment Owner or designated beneficiary under the Plan or in a Plan Investment or the Notes issued in connection therewith shall be pledged or hypothecated to secure, or otherwise be made subject to, any obligation or liability of such Investor or other Registered Investment Owner. Notwithstanding the provisions of this paragraph XIV, a Plan Investment may be debited for all amounts which the Company or the Agent Bank shall have caused, in error, to be credited to such Plan Investment.

 

XV. Fees

The Committee may designate from time to time such fees in connection with investments or redemptions in the Notes or otherwise in connection with the Notes, including fees for checks, for returned checks and for stop payment requests, as shall be determined by the Committee, provided the Committee shall communicate such fees to the Investors in sufficient time prior to the effective date thereof to permit the Investors to redeem amounts credited to their respective Plan Investments together with accrued and unpaid interest in accordance with the terms of the Plan in effect prior to the effective date of such fees.

 

XVI. Miscellaneous

The records of the Company, the Agent Bank, the Trustee and the Committee shall be conclusive in respect of all matters involved in the administration of the Plan.

Except as specified in paragraph XV, all expenses of administering the Plan, including without limitation the fees of the Agent Bank and the Trustee and other expenses charged or incurred by the Agent Bank and the Trustee, shall be borne by the Company, and no charge or penalty shall be imposed by the Company, the Agent Bank or the Trustee against any Plan Investment or Registered Investment Owner by reason of participation in the Plan; provided, however, that neither the Company, the Agent Bank nor the Trustee shall have any liability for any cost incurred by a Registered Investment Owner including, but not limited to, costs incurred in connection with the wiring of funds to make investments under the Plan.

The Plan shall be governed by and construed in accordance with the laws of the State of New York.

 

XVII. Effectiveness

The Plan shall be effective as of the date that the Registration Statement under the Securities Act of 1933, as amended, with respect to the initial offering of the Notes is filed with the Securities and Exchange Commission and becomes effective.

 

6

EX-4.2

Exhibit 4.2

 

 

DOMINION ENERGY, INC.,

Issuer

AND

DEUTSCHE BANK TRUST COMPANY AMERICAS

Trustee

 

 

Indenture

Dated as of November 1, 2017

 

 

Variable Denomination Floating Rate

Demand Notes

 

 


Reconciliation and Tie between Trust Indenture Act of 1939 and

Indenture, dated as of November 1, 2017

between

Dominion Energy, Inc., Issuer

and

Deutsche Bank Trust Company Americas, Trustee

 

Trust Indenture

Act Section

   Indenture Section

§310(a)(1)

   609

(a)(2)

   609

(a)(3)

   Not Applicable

(a)(4)

   Not Applicable

(a)(5)

   609

(b)

   608
   610

§311(a)

   613

(b)

   613

(b)(2)

   703(a)(3)
   703(b)

§312(a)

   701
   702(a)

(b)

   702(b)

(c)

   702(c)

§313(a)

   703(a)

(b)

   703(b)

(c)

   703(a), 703(b)

(d)

   703(c)

§314(a)(1)

   704

(a)(2)

   704

(a)(3)

   704

(a)(4)

   1004

(b)

   Not Applicable

(c)(1)

   102

(c)(2)

   102

(c)(3)

   Not Applicable

(d)

   Not Applicable

(e)

   102

§315(a)

   601(a)

(b)

   602
   703(a)(6)

(c)

   601(b)

(d)

   601(c)

(d)(1)

   601(a)

(d)(2)

   601(c)(2)

(d)(3)

   601(c)(3)

(e)

   514

§316(a)

   101

(a)(1)(A)

   502
   512

(a)(1)(B)

   513

(a)(2)

   Not Applicable

(b)

   508

(c)

   104(e)


Trust Indenture

Act Section

   Indenture Section

§317(a)(1)

   503

(a)(2)

   504

(b)

   1003

§318(a)

   107

 

NOTE: This reconciliation and tie shall not, for any purpose, be deemed to be a part of the Indenture.


TABLE OF CONTENTS*

 

         Page  

PARTIES

    

RECITALS OF THE COMPANY

     1  

ARTICLE ONE

 

DEFINITIONS AND OTHER PROVISIONS OF GENERAL APPLICATION

  

Section 101.

  Definitions      1  

Section 102.

  Compliance Certificates and Opinions      5  

Section 103.

  Form of Documents Delivered to Trustee      5  

Section 104.

  Acts of Holders      6  

Section 105.

  Notices, Etc., to Trustee, Company and Agent Bank      7  

Section 106.

  Notice to Holders; Waiver      8  

Section 107.

  Conflict with Trust Indenture Act      8  

Section 108.

  Effect of Headings and Table of Contents      8  

Section 109.

  Successors and Assigns      8  

Section 110.

  Separability Clause      9  

Section 111.

  Benefits of Indenture      9  

Section 112.

  Governing Law      9  

Section 113.

  Legal Holidays      9  

Section 114.

  Persons Deemed Owners      9  

Section 115.

  U.S.A. Patriot Act      9  

ARTICLE TWO

 

AMOUNT, PAYMENT AND RESTRICTION TRANSFER OF SECURITIES

  

Section 201.

  Amount Unlimited      9  

Section 202.

  Form      10  

Section 203

  Priority      10  

Section 204

  Payment      10  

Section 205.

  Restriction on Transfer of Securities      10  

ARTICLE THREE

 

REDEMPTION OF SECURITIES

  

Section 301.

  Redemption of All or Part of the Securities      10  

Section 302.

  Redemption of a Specified Holder’s Securities      11  

Section 303.

  Payment of Redemption Price for Company Redemptions; Selection of Securities for Redemption      12  

Section 304.

  Redemption at the Option of the Holder      12  

Section 305.

  Redemption by Offsetting Application of Fees      13  

 

* This Table of Contents shall not, for any purpose, be deemed to be part of the Indenture.

 

-i-


TABLE OF CONTENTS

(continued)

 

         Page  

ARTICLE FOUR

 

SATISFACTION AND DISCHARGE OF INDENTURE

  

Section 401.

  Satisfaction and Discharge of Indenture      13  

Section 402.

  Application of Trust Money      14  

ARTICLE FIVE

 

REMEDIES

  

Section 501.

  Events of Default      14  

Section 502.

  Acceleration of Maturity; Rescission and Annulment      15  

Section 503.

  Collection of Indebtedness and Suits for Enforcement by Trustee      15  

Section 504.

  Trustee May File Proofs of Claim      16  

Section 505.

  Trustee May Enforce Claims Without Possession of Securities      17  

Section 506.

  Application of Money Collected      17  

Section 507.

  Limitation on Suits      17  

Section 508.

  Unconditional Right of Holders to Receive Principal, Premium and Interest      18  

Section 509.

  Restoration of Rights and Remedies      18  

Section 510.

  Rights and Remedies Cumulative      18  

Section 511.

  Delay or Omission Not Waiver      18  

Section 512.

  Control by Holders      18  

Section 513.

  Waiver of Past Defaults      19  

Section 514.

  Undertaking for Costs      19  

Section 515.

  Waiver of Stay or Extension Laws      20  

ARTICLE SIX

 

THE TRUSTEE

  

Section 601.

  Certain Duties and Responsibilities      20  

Section 602.

  Notice of Defaults      21  

Section 603.

  Certain Rights of Trustee      21  

Section 604.

  Not Responsible for Recitals or Issuance of Securities      23  

Section 605.

  May Hold Securities      23  

Section 606.

  Money Held in Trust      23  

Section 607.

  Compensation and Reimbursement      23  

Section 608.

  Disqualification; Conflicting Interests      24  

Section 609.

  Corporate Trustee Required; Eligibility      24  

Section 610.

  Resignation and Removal; Appointment of Successor      25  

 

-ii-


TABLE OF CONTENTS

(continued)

 

         Page  

Section 611.

  Acceptance of Appointment by Successor      26  

Section 612.

  Merger, Conversion, Consolidation or Succession to Business      26  

Section 613.

  Preferential Collection of Claims Against Company      26  

ARTICLE SEVEN

 

HOLDERS’ LIST AND REPORTS BY TRUSTEE AND COMPANY

  

Section 701.

  Company to Furnish Trustee Names and Addresses of Holders      30  

Section 702.

  Preservation of Information; Communications to Holders      30  

Section 703.

  Reports by Trustee      31  

Section 704.

  Reports by Company      33  

ARTICLE EIGHT

 

CONSOLIDATION, MERGER, CONVEYANCE, TRANSFER OR LEASE

  

Section 801.

  Company May Consolidate, Etc., on Certain Terms      33  

Section 802.

  Successor Substituted      34  

ARTICLE NINE

 

SUPPLEMENTAL INDENTURES

  

Section 901.

  Supplemental Indentures without Consent of Holders      34  

Section 902.

  Supplemental Indentures with Consent of Holders      35  

Section 903.

  Execution of Supplemental Indentures      36  

Section 904.

  Effect of Supplemental Indentures      36  

Section 905.

  Conformity with Trust Indenture Act      36  

ARTICLE TEN

 

COVENANTS

  

Section 1001.

  Administration of Plan; Payment of Principal and Interest      36  

Section 1002.

  Maintenance of Security Register; Maintenance of Office or Agency      37  

Section 1003.

  Money for Securities Payments to Be Held in Trust      37  

Section 1004.

  Certificate of Officers of the Company      38  

 

-iii-


INDENTURE dated as of November 1, 2017, between DOMINION ENERGY, INC., a corporation duly organized and existing under the laws of the Commonwealth of Virginia (herein called the “Company”), having its principal office at 120 Tredegar Street, Richmond, Virginia 23219, and DEUTSCHE BANK TRUST COMPANY AMERICAS, a New York banking corporation, duly organized and existing under the laws of the State of New York, having its Corporate Trust Office at 60 Wall Street, 16th Floor, New York, New York 10005, as Trustee (herein called the “Trustee”).

RECITALS OF THE COMPANY

The Company has duly authorized the execution and delivery of this Indenture to provide for the issuance from time to time of its unsecured variable denomination floating rate demand notes (herein called the “Securities”) pursuant to the Plan (as defined below).

All things necessary to make this Indenture a valid agreement of the Company, in accordance with its terms, have been done.

NOW, THEREFORE, THIS INDENTURE WITNESSETH:

For and in consideration of the premises and the purchase of the Securities by the Holders thereof, it is mutually covenanted and agreed, for the equal and proportionate benefit of all Holders of the Securities, as follows:

ARTICLE ONE

DEFINITIONS AND OTHER PROVISIONS

OF GENERAL APPLICATION

Section 101. Definitions.

For all purposes of this Indenture, except as otherwise expressly provided or unless the context otherwise requires:

(1) the terms defined in this Article have the meanings assigned to them in this Article and include the plural as well as the singular;

(2) all other terms used herein which are defined in the Trust Indenture Act or by Commission rule under the Trust Indenture Act, either directly or by reference therein, have the meanings assigned to them therein;

(3) all accounting terms not otherwise defined herein have the meanings assigned to them in accordance with generally accepted accounting principles, and, except as otherwise herein expressly provided, the term “generally accepted accounting principles” with respect to any computation required or permitted hereunder shall mean such accounting principles as are generally accepted in the United States of America at the date of such computation; and

(4) the words “herein”, “hereof’ and “hereunder” and other words of similar import refer to this Indenture as a whole and not to any particular Article, Section or other subdivision.


“Act”, when used with respect to any Holder, has the meaning specified in Section 104.

“Affiliate” of any specified Person means any other Person directly or indirectly controlling or controlled by or under direct or indirect common control with such specified Person. For the purposes of this definition, “control” when used with respect to any specified Person means the power to direct the management and policies of such Person, directly or indirectly, whether through the ownership of voting securities, by contract or otherwise; and the terms “controlling” and “controlled” have meanings correlative to the foregoing.

“Agent Bank” means a bank, corporation or other legal entity, and its successors and assigns, appointed by the Company to act as agent under the Plan and to perform all functions required of such agent pursuant to the provisions of the Plan, and which may serve as Paying Agent pursuant to the provisions of this Indenture. The initial Agent Bank shall be The Northern Trust Company.

“Board of Directors” means either the board of directors of the Company or any duly authorized committee of that board.

“Board Resolution” means a resolution of the Company, in the form of a resolution of the Board, in the form of a resolution of a duly constituted committee of the Board, or in the form of a resolution of two or more senior officers (that is, the President, the Chief Executive Officer, any Vice President, the Treasurer, the Corporate Secretary or the General Counsel) of the Company, authorizing, ratifying, setting forth or otherwise validating agreements, execution and delivery of documents, the issuance, form and terms of Securities, or any other actions or proceedings pursuant or with respect to this Indenture.

“Business Day” means each Monday, Tuesday, Wednesday, Thursday and Friday which is not a day on which the Agent Bank is authorized or obligated by law to close.

“Commission” means the Securities and Exchange Commission, as from time to time constituted, created under the Securities Exchange Act of 1934, or, if at any time after the execution of this instrument such Commission is not existing and performing the duties now assigned to it under the Trust Indenture Act, then the body performing such duties at such time.

“Committee” means the Dominion Energy Reliability Investment Committee established pursuant to the Plan to supervise the administration of the Plan.

“Company” means the Person named as the “Company” in the first paragraph of this instrument until a successor corporation shall have become such pursuant to the applicable provisions of this Indenture, and thereafter “Company” shall mean such successor corporation.

“Company Request” or “Company Order” mean, respectively, a written request or order, as the case may be, signed in the name of the Company by any two Officers or by any Officer and either an Assistant Treasurer or an Assistant Corporate Secretary of the Company and delivered to the Trustee.

“Corporate Trust Office” means the designated office of the Trustee at which the corporate trust business of the Trustee shall at any particular time be administered, which office at the date of original execution of this Indenture is located at 60 Wall Street, 16th Floor, New York, New York 10005, Attention: Corporates Department, Dominion Energy, Inc. Account Manager.

“corporation” includes corporations, associations, companies and business trusts.

 

- 2 -


“Event of Default” has the meaning specified in Section 501.

“Holder” means, with respect to a Security, a Person in whose name at the time a particular Security is registered in the Security Register.

“Indenture” means this instrument as originally executed or as it may from time to time be supplemented or amended by one (1) or more indentures supplemental hereto entered into pursuant to the applicable provisions hereof.

“Maximum Account Balance” means, at any time, the amount specified by the Committee at such time as the maximum principal amount of a Security.

“Minimum Account Balance” means, at any time, the amount specified by the Committee at such time as the minimum principal amount of a Security.

“New York Business Day” means each Monday, Tuesday, Wednesday, Thursday and Friday which is not a day on which banking institutions in the City of New York, New York are authorized or obligated by law to close.

“Officer” means the Chairman of the Board, the President, any Vice President, the Treasurer, the Corporate Secretary or the Controller of the Company.

“Officers’ Certificate” means a certificate signed by two Officers or by any Officer and either an Assistant Treasurer or an Assistant Corporate Secretary of the Company, that, if required by the Trust Indenture Act, complies with the requirements of Section 314(e) of the Trust Indenture Act and is delivered to the Trustee.

“Opinion of Counsel” means a written opinion of counsel, who may be an employee of or counsel for the Company or other counsel that, if required by the Trust Indenture Act, complies with the requirements of Section 314(e) of the Trust Indenture Act.

“Outstanding”, when used with respect to Securities, means, as of the date of determination, all Securities in which Holders have made investments as shown on the Security Register, except:

(i) Securities or portions thereof theretofore redeemed by the Holders pursuant to the provisions of the Plan and this Indenture;

(ii) Securities or portions thereof theretofore redeemed by the Company pursuant to the provisions of this Indenture;

(iii) Securities or portions thereof for whose payment or redemption money in the necessary amount has been theretofore deposited with the Trustee or any Paying Agent (other than the Company) in trust or set aside and segregated in trust by the Company (if the Company shall act as its own Paying Agent), for the Holders of such Securities; provided that, if such Securities are to be redeemed at the option of the Company, notice of such redemption has been duly given pursuant to this Indenture or provision therefor satisfactory to the Trustee has been made;

provided, however, that in determining whether the Holders of the requisite principal amount of the Outstanding Securities have given any request, demand, authorization, direction, notice,

 

- 3 -


consent or waiver hereunder, Securities owned by the Company or any other obligor upon the Securities or any Affiliate of the Company or of such other obligor shall be disregarded and deemed not to be Outstanding, except that, in determining whether the Trustee shall be protected in relying upon any such request, demand, authorization, direction, notice, consent or waiver, only Securities which the Trustee knows to be so owned shall be so disregarded.

“Paying Agent” means any Person authorized by the Company to pay the principal of or interest on any Securities on behalf of the Company. The initial Paying Agent shall be The Northern Trust Company.

“Person” means any individual, corporation, partnership, joint venture, association, joint-stock company, trust, unincorporated organization or government or any agency or political subdivision thereof.

“Plan” means the Dominion Energy Reliability Investment Plan established by the Company and in effect on the date hereof, as the same may be amended or supplemented from time to time.

“principal amount”, when used with reference to a Security, means, as of a particular time, the sum of the funds invested in a Security, plus the sum of interest accrued, paid and reinvested in a Security, less the sum of redemptions from time to time.

“Redemption Date”, when used with respect to any Security to be redeemed, means the date fixed for such redemption by or pursuant to this Indenture.

“Responsible Officer” means any officer of the Trustee in its corporate trust department and also means, with respect to a particular corporate trust matter, any other officer to whom such matter is referred because of his or her knowledge of and familiarity with the particular subject and who shall have direct responsibility for the administration of this Indenture.

“Security” or “Securities” means any Variable Denomination Floating Rate Demand Note or Notes, as the case may be, issued pursuant to the Plan and under this Indenture, which are evidenced by an individual record or entries in the name of the particular Holder established on the Security Register.

“Security Register” has the meaning specified in Section 1002.

“Security Registrar” means the agent of the Company maintaining the Security Register pursuant to Section 1002.

“Subsidiary” means a corporation, partnership, limited liability company or other entity more than 50% of the outstanding Voting Equity of which is owned, directly or indirectly, by the Company or one (1) or more Subsidiaries, or by the Company and one (1) or more Subsidiaries.

“Trustee” means the Person named as the “Trustee” in the first paragraph of this instrument until a successor Trustee shall have become such pursuant to the applicable provisions of this Indenture, and thereafter “Trustee” shall mean or include its successors as Trustee hereunder.

 

- 4 -


“Trust Indenture Act” means the Trust Indenture Act of 1939 as in force at the date as of which this instrument was executed, except as provided in Section 905.

“United States” means the United States of America (including the States and the District of Columbia), its territories, its possessions and other areas subject to its jurisdiction.

“Vice President”, when used with respect to the Company, means any vice president, whether or not designated by a number or a word or words (other than “assistant”) added before or after the title “vice president.”

“Voting Equity,” means stock or other ownership interests having ordinary voting power for the election of directors or other managers of a corporation, partnership, limited liability company or other entity, whether at all times or only so long as no senior class of stock or other ownership interests has such voting power by reason of any contingency.

Section 102. Compliance Certificates and Opinions.

Upon any application or request by the Company to the Trustee to take any action under any provision of this Indenture, the Company shall furnish to the Trustee an Officers’ Certificate stating that all conditions precedent, if any, provided for in this Indenture relating to the proposed action have been complied with and an Opinion of Counsel stating that in the opinion of such counsel all such conditions precedent, if any, have been complied with, except that in the case of any such application or request as to which the furnishing of such documents is specifically required by any provision of this Indenture relating to such particular application or request, no additional certificate or opinion need be furnished.

Every certificate or opinion with respect to compliance with a condition or covenant provided for in this Indenture (other than annual certificates provided pursuant to Section 1004) shall include:

(1) a statement that each individual signing such certificate or opinion has read such covenant or condition and the definitions herein relating thereto;

(2) a brief statement as to the nature and scope of the examination or investigation upon which the statements or opinions contained in such certificate or opinion are based;

(3) a statement that, in the opinion of each such individual, he has made such examination or investigation as is necessary to enable him to express an informed opinion as to whether or not such covenant or condition has been complied with; and

(4) a statement as to whether, in the opinion of each such individual, such condition or covenant has been complied with.

Section 103. Form of Documents Delivered to Trustee.

In any case where several matters are required to be certified by, or covered by an opinion of, any specified Person, it is not necessary that all such matters be certified by, or covered by the opinion of, only one (1) such Person, or that they be so certified or covered by only one (1) document, but one (1) such Person may certify or give an opinion with respect to some matters and one (1) or more other such Persons as to other matters, and any such Person may certify or give an opinion as to such matters in one (1) or several documents.

 

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Any certificate or opinion of an officer of the Company may be based, insofar as it relates to legal matters, upon a certificate or opinion of, or representations by, counsel, unless such officer knows that the certificate or opinion or representations with respect to the matters upon which his certificate or opinion is based are erroneous. Any such certificate or Opinion of Counsel may be based, insofar as it relates to factual matters, upon a certificate or opinion of, or representations by, an officer or officers of the Company stating that the information with respect to such factual matters is in the possession of the Company, unless such counsel knows that the certificate or opinion or representations with respect to such matters are erroneous.

Where any Person is required to make, give or execute two or more applications, requests, consents, certificates, statements, opinions or other instruments under this Indenture, they may, but need not, be consolidated and form one (1) instrument.

Whenever, subsequent to the receipt by the Trustee of any Board Resolution, Officers’ Certificate, Opinion of Counsel or other document or instrument, a clerical, typographical or other inadvertent or unintentional error or omission shall be discovered therein, a new document or instrument may be substituted therefor in corrected form with the same force and effect as if originally filed in the corrected form and, irrespective of the date or dates of the actual execution and/or delivery thereof, such substitute document or instrument shall be deemed to have been executed and/or delivered as of the date or dates required with respect to the document or instrument for which it is substituted. Anything in this Indenture to the contrary notwithstanding, if any such corrective document or instrument indicates that action has been taken by or at the request of the Company that could not have been taken had the original document or instrument not contained such error or omission, the action so taken shall not be invalidated or otherwise rendered ineffective but shall be and remain in full force and effect, except to the extent that such action was a result of willful misconduct or negligence. Without limiting the generality of the foregoing, any Securities issued under the authority of such defective document or instrument shall nevertheless be the valid obligations of the Company entitled to the benefits of this Indenture equally and ratably with all other Outstanding Securities, except as aforesaid.

Section 104. Acts of Holders.

(a) Any request, demand, authorization, direction, notice, consent, waiver or other action provided by this Indenture to be given or taken by Holders may be embodied in and evidenced by one (1) or more instruments of substantially similar tenor signed by such Holders in person or by agent duly appointed in writing; and, except as herein otherwise expressly provided, such action shall become effective when such instrument or instruments are delivered to the Trustee and, where it is hereby expressly required, to the Company. Such instrument or instruments (and the action embodied therein and evidenced thereby) are herein sometimes referred to as the “Act” of the Holders signing such instrument or instruments. Proof of execution of any such instrument or of a writing appointing any such agent shall be sufficient for any purpose of this Indenture and (subject to Section 601) conclusive in favor of the Trustee and the Company, if made in the manner provided in this Section.

(b) The fact and date of the execution by any Person of any such instrument or writing may be proved by the affidavit of a witness of such execution or by a certificate of a notary public or other officer authorized by law to take acknowledgments of deeds, certifying that the individual signing such instrument or writing acknowledged to him the execution thereof. Where such execution is by a signer acting in a capacity other than his individual capacity, such certificate or affidavit shall also constitute sufficient proof of his authority. The fact and date of the execution of any such instrument or writing, or the authority of the Person executing the same, may also be proved in any other manner which the Trustee deems sufficient.

(c) The ownership and principal amount of Securities held by any Person, and the date of the commencement and the date of the termination of holding the same, shall be proved by the Security Register.

(d) Any request, demand, authorization, direction, notice, consent, waiver or other Act of the Holder of any Security shall bind every future Holder of the same Security and the Holder of every Security issued upon the registration of transfer thereof or in exchange therefor or in lieu thereof in respect of anything done, omitted or suffered to be done by the Trustee or the Company in reliance thereon, whether or not notation of such action is made upon such Security.

 

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(e) The Company may set a record date for purposes of determining the identity of Holders entitled to give any request, demand, authorization, direction, notice, consent, waiver or other Act which record date shall be the later of ten (10) days prior to the first solicitation of such action or the date of the most recent list of Holders furnished to the Trustee pursuant to Section 701 of this Indenture prior to such solicitation. If a record date is fixed, those persons who were Holders of Securities at such record date (or their duly designated proxies), and only those persons shall be entitled to take such action or to revoke any such previous action, whether or not such persons continue to be Holders after such record date. No such request, demand, authorization, direction, notice, consent, waiver or other Act shall be valid or effective for more than one hundred twenty (120) days after such record date.

Section 105. Notices, Etc., to Trustee, Company and Agent Bank.

Any request, demand authorization, direction, notice, consent, waiver or Act of Holders or other document provided or permitted by this Indenture to be made upon, given or furnished to, or filed with,

(1) the Trustee by any Holder or by the Company shall be sufficient for every purpose hereunder if made, given, furnished or filed in writing to or with the Trustee at its Corporate Trust Office, Attention: Corporates Department, or

(2) the Company by the Trustee or by any Holder shall be sufficient for every purpose hereunder (unless otherwise herein expressly provided) if in writing and mailed, first-class postage prepaid, to the Company addressed to it at the address of its principal office specified in the first paragraph of this instrument or at any other address previously furnished in writing to the Trustee by the Company; or

(3) the Agent Bank by the Company or the Trustee shall be sufficient for every purpose hereunder (unless otherwise herein expressly provided) if in writing and mailed, first-class postage prepaid, to the Agent Bank at The Northern Trust Company, 50 South LaSalle Street, Chicago, Illinois 60603, Attention: Division Manager, Treasury Management Services, or at any address previously furnished in writing to the Company and the Trustee by the Agent Bank; or

(4) the Agent Bank by any Holder shall be sufficient for every purpose hereunder (unless otherwise herein expressly provided) if given in such manner, including notification address, as may from time to time be determined by the Committee, following consultation with the Agent Bank, as most recently provided in writing to the Holders or publicly announced or published by the Company in any appropriate format or manner, including posting on any Company-sponsored Internet Web site relating to investment in or redemption of the Securities.

The Trustee agrees to accept and act upon instructions or directions pursuant to this Indenture sent by unsecured e-mail, facsimile transmission or other similar unsecured electronic methods; provided, however, that (a) the party providing such electronic instructions or directions, subsequent to the transmission thereof, shall provide the originally executed instructions or directions to the Trustee in a timely manner and (b) such originally executed

 

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instructions or directions shall be signed by an authorized representative of the party providing such instructions or directions. The Trustee shall not be liable for any losses, costs or expenses arising directly or indirectly from the Trustee’s reliance upon and compliance with such electronic instructions or directions notwithstanding such instructions or directions conflict or are inconsistent with a subsequent written instruction or direction or if the subsequent written instruction or direction is never received. The party providing instructions or directions by unsecured e-mail, facsimile transmission or other similar unsecured electronic methods, as aforesaid, agrees to assume all risks arising out of the use of such electronic methods to submit instructions and directions to the Trustee, including without limitation the risk of the Trustee acting on unauthorized instructions, and the risk of interception and misuse by third parties.

Section 106. Notice to Holders; Waiver.

Where this Indenture provides for notice to Holders of any event, such notice shall be sufficiently given (unless otherwise herein expressly provided) if in writing and mailed, first-class postage prepaid, to each Holder affected by such event, at his address as it appears in the Security Register, not later than the latest date, and not earlier than the earliest date, prescribed for the giving of such notice. In any case where notice to Holders is given by mail, neither the failure to mail such notice, nor any defect in any notice so mailed, to any particular Holder shall affect the sufficiency of such notice with respect to other Holders. Where this Indenture provides for notice in any manner, such notice may be waived in writing by the Person entitled to receive such notice, either before or after the event, and such waiver shall be the equivalent of such notice. Waivers of notice by Holders shall be filed with the Trustee, but such filing shall not be a condition precedent to the validity of any action taken in reliance upon such waiver.

In case by reason of the suspension of regular mail service or by reason of any other cause it shall be impracticable to give such notice by mail, then such notification as shall be made with the approval of the Trustee shall constitute a sufficient notification for every purpose hereunder.

Section 107. Conflict with Trust Indenture Act.

If any provision hereof limits, qualifies or conflicts with the duties imposed by any of Sections 310 to 317, inclusive, of the Trust Indenture Act through operation of Section 318(c) thereof, such imposed duties shall control.

Section 108. Effect of Headings and Table of Contents.

The Article and Section headings herein and the Table of Contents are for convenience only and shall not affect the construction hereof.

Section 109. Successors and Assigns.

All covenants and agreements in this Indenture by the Company shall bind its successors and assigns, whether so expressed or not.

 

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Section 110. Separability Clause.

In case any provision in this Indenture or in the Securities shall be invalid, illegal or unenforceable, the validity, legality and enforceability of the remaining provisions shall not in any way be affected or impaired thereby.

Section 111. Benefits of Indenture.

Nothing in this Indenture or in the Securities, express or implied, shall give to any Person, other than the parties hereto and their successors hereunder and the Holders, any benefit or any legal or equitable right, remedy or claim under this Indenture.

Section 112. Governing Law; Waiver of Jury Trial.

This Indenture and the Securities shall be governed by and construed in accordance with the laws of the State of New York. EACH OF THE COMPANY, THE TRUSTEE AND THE HOLDERS HEREBY IRREVOCABLY WAIVE, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY AND ALL RIGHT TO TRIAL BY JURY IN ANY LEGAL PROCEEDING ARISING OUT OF OR RELATING TO THIS INDENTURE OR THE SECURITIES. To the fullest extent permitted by applicable law, the Company hereby irrevocably submits to the jurisdiction of any Federal or State court located in the Borough of Manhattan in The City of New York, New York in any suit, action or proceeding based on or arising out of or relating to this Indenture or any Securities and irrevocably agrees that all claims in respect of such suit or proceeding may be determined in any such court. The Company irrevocably waives, to the fullest extent permitted by law, any objection which it may have to the laying of the venue of any such suit, action or proceeding brought in an inconvenient forum. The Company agrees that final judgment in any such suit, action or proceeding brought in such a court shall be conclusive and binding upon the Company, and may be enforced in any courts in the jurisdiction in which the Company is subject by a suit upon such judgment, provided, that service of process is effected upon the Company in the manner specified herein or as otherwise permitted by law.

Section 113. Legal Holidays.

In any case where any Redemption Date shall not be a Business Day, then (notwithstanding any other provision of this Indenture or of the Securities) payment of the redemption price need not be made on such date, but may be made on the next succeeding Business Day with the same force and effect as if made on the Redemption Date, provided that no interest shall accrue on the payment so deferred for the period from and after such Redemption Date.

Section 114. Persons Deemed Owners.

The Company, the Trustee and any agent of the Company or the Trustee may treat the Person in whose name a Security is registered as the owner of such Security for the purpose of receiving payment of principal of and interest on such Security and for all other purposes whatsoever, whether or not such Security be overdue, and neither the Company, the Trustee nor any agent of the Company or the Trustee shall be affected by notice to the contrary.

Section 115. U.S.A. Patriot Act.

In order to comply with the laws, rules, regulations and executive orders in effect from time to time applicable to banking institutions, including, without limitation, those relating to the funding of terrorist activities and money laundering, including Section 326 of the USA PATRIOT Act of the United States (“Applicable Law”), the Trustee is required to obtain, verify, record and update certain information relating to individuals and entities which maintain a business relationship with the Trustee. Accordingly, each of the parties agree to provide to the Trustee, upon their request from time to time such identifying information and documentation as may be available for such party in order to enable the Trustee to comply with Applicable Law.

ARTICLE TWO

AMOUNT, FORM, PRIORITY, PAYMENT, INTEREST AND

RESTRICTION ON TRANSFER OF SECURITIES

Section 201. Amount Unlimited.

The Securities shall be issued pursuant to the Plan and under this Indenture in an unlimited aggregate principal amount. The Securities shall not be required to be in any particular denomination, whether minimum or otherwise.

 

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Section 202. Form.

The Securities shall be issued in uncertificated form and no certificate or other instrument evidencing the Securities will be issued. The Securities shall have no stated maturity and shall be redeemable at the option of the Company or the Holders thereof in accordance with the provisions contained in Article Three.

Section 203. Priority.

The Securities shall be unsecured and shall rank pari passu with all other unsecured and unsubordinated indebtedness of the Company.

Section 204. Payment.

The Securities shall be payable at the office or agency of the Company maintained for such purpose as may from time to time be designated in writing to the Trustee in such coin or currency of the United States of America as at the time of payment is legal tender for the payment of public and private debts. The initial such agency of the Company shall be The Northern Trust Company.

Section 205. Restriction on Transfer of Securities.

The Securities may not be transferred, in whole or in part, either directly or by operation of law or otherwise, except if and to the extent provided in the Plan.

ARTICLE THREE

REDEMPTION OF SECURITIES

Section 301. Redemption of All or Part of the Securities.

The Company may redeem, at any time in its discretion, all or any portion of any of the Securities issued pursuant to the Plan and under this Indenture. In case the Company shall desire to exercise any right to redeem all, or, as the case may be, any part of the Securities, it shall fix a date for redemption and shall mail or cause to be mailed a notice of such redemption at least twenty (20) and not more than sixty (60) days (except as otherwise provided in the Plan) prior to the date fixed for redemption to the Holders of Securities so to be redeemed at their last addresses as the same appear on the Security Register and to the Trustee. Such mailing shall be by first class mail or by such other method as shall be provided for in the Plan. The notice, if mailed or otherwise given in accordance with the method provided for in the Plan, shall be conclusively presumed to have been duly given, whether or not the Holder receives such notice. In any case, failure to give such notice by mail or such other method or any defect in the notice to the holder of any Security designated for redemption as a whole or in part shall not affect the validity of the proceedings for the redemption of any other Security.

Each such notice of redemption pursuant to this Section 301 shall specify the Redemption Date, the principal amount of the Security being redeemed, the manner in which the redemption price for the Security being redeemed shall be paid (which shall be by check mailed to the Holder unless otherwise specified in such notice) and that on and after the Redemption Date any interest on the Security, or on the portions thereof, being redeemed will cease to accrue.

 

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Section 302. Redemption of a Specified Holder’s Securities.

(a) In addition to its right to redeem all or any part of the Securities under Section 301, the Company may redeem the Securities of specified Holders as set forth in this Section 302.

(b) The Company may redeem, at any time, in its discretion, all of the Securities of a Holder if the aggregate principal amount of the Securities held by such Holder is below the Minimum Account Balance and no investment has been made in Securities by such Holder (other than interest accrued and reinvested pursuant to provisions of the Plan) for a period of three calendar months immediately preceding the determination of such deficiency (or such other period as the Committee from time to time may determine). The Company will notify a Holder of its intention to redeem such Holder’s Securities under this Section 302(b). If such Holder does not make additional investments in Securities to increase the aggregate principal amount of the Securities held by such Holder to equal or exceed the Minimum Account Balance during the period of thirty (30) days following the date of such notice, the Company may redeem all of such Holder’s Securities on the thirty-first (31st) day following the date of such notice, which date shall be the Redemption Date for the redemption of such Securities. Such notice shall specify that on and after the Redemption Date any interest on the Securities being redeemed will cease to accrue.

(c) The Company may redeem, at any time, in its discretion, all or any portion of the Securities of a Holder if the aggregate principal amount of the Securities held by such Holder exceeds the Maximum Account Balance for a continuing period of three calendar months immediately preceding the determination of such excess (or such other period as the Committee from time to time may determine). The Company will notify a Holder of its intention to redeem such Holder’s Securities under this Section 302(c) to the extent the aggregate principal amount thereof exceeds the Maximum Account Balance (or such greater amount as the Company may specify in such notice). If such Holder does not redeem Securities in an amount sufficient to reduce the aggregate principal amount of the Securities held by such Holder to an amount equal to or less than the Maximum Account Balance during the period of thirty (30) days following the date of such notice, the Company may redeem such Holder’s Securities to the extent the aggregate principal amount thereof exceeds the Maximum Account Balance (or such greater amount as is specified by the Company in such notice) on the thirty-first (31st) day following the date of such notice, which date shall be the Redemption Date for the redemption of such amount of the Securities. Such notice shall specify that on and after the Redemption Date any interest on the Securities being redeemed will cease to accrue.

(d) The Company shall have the right to redeem any Securities of any Holder who is not or is no longer eligible to invest in the Securities in accordance with the Plan, or who has abused or misused the investment or redemption provisions applicable to the Securities or whose investments are otherwise inconsistent with the objectives of the Plan, in each case as the Company determines in its sole judgment and discretion. In the event of such a redemption, the Company shall notify the Holder of its intention to redeem, pursuant to this Section 302(d), in

 

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full such Holder’s Securities on the third Business Day following the date of the Company’s notice, which date shall be the Redemption Date for the redemption of such Securities. Such notice shall specify that on and after the Redemption Date any interest on the Securities being redeemed will cease to accrue.

Section 303. Payment of Redemption Price for Company Redemptions; Selection of Securities for Redemption.

If notice of redemption has been given as provided in Section 301 or Section 302, the Securities, or portions thereof, with respect to which such notice has been given shall become due and payable on the Redemption Date at a redemption price equal to 100% of the principal amount thereof being redeemed plus accrued and unpaid interest thereon to the Redemption Date less any applicable fees established under the Plan, and on and after the Redemption Date (unless the Company shall default in the payment of such Securities, together with any interest accrued and unpaid to the Redemption Date and less any applicable fees) any interest on the Securities, or on the portions thereof, so called for redemption shall cease to accrue.

On or prior to the Redemption Date specified in the notice of redemption given as provided in Section 301 or Section 302, the Company will deposit with the Trustee, the Agent Bank or with one (1) or more Paying Agents an amount of money sufficient to redeem on the Redemption Date all the Securities, or portions thereof, so called for redemption, together with accrued and unpaid interest to the date fixed for redemption less any applicable fees established under the Plan. If less than all the Securities are to be redeemed by the Company pursuant to Section 301, the Company will give the Agent Bank notice not less than sixty (60) days (or such shorter period as shall be acceptable to the Agent Bank) prior to the Redemption Date as to the aggregate principal amount of Securities to be redeemed and the Agent Bank shall select or cause to be selected, in such manner as in its sole discretion it shall deem appropriate and fair, the Securities or portions thereof to be redeemed.

Section 304. Redemption at the Option of the Holder.

(a) Subject to the right of the Company to establish from time to time a minimum amount for any redemption in part, a Security may be redeemed in whole or in part at any time at the option of, and upon the demand by, the Holder by delivering to the Agent Bank in writing a notice to such effect, including by bank check drawn on the Agent Bank, or by following such other procedures as shall be established under the Plan. Such notice shall contain the information specified by the Company from time to time as the information which is required by the Company in order to properly process the redemption request. The Company may establish from time to time additional methods of redemption that may be elected by the Holder.

(b) Upon receipt by the Agent Bank of an appropriate redemption notice as provided for in clause (a) of this Section 304, the Securities, or portions thereof, with respect to which such notice has been given shall become due and payable on the Redemption Date (which date shall be no later than the next Business Day following receipt of such notice) at a redemption price equal to 100% of the principal amount thereof plus, and in the case of a redemption of all Securities held by such Holder, accrued and unpaid interest thereon to the Redemption Date less applicable fees established under the Plan. In the case of any redemption, whether in whole or in part, on and after the Redemption Date (unless the Company shall default in the payment of the Securities, together with any interest accrued to the Redemption Date) any interest on the Securities (or portions thereof) so called for redemption shall cease to accrue.

 

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(c) On or prior to the Redemption Date specified in the notice of redemption given as provided in this Section 304, the Company will deposit with the Trustee, the Agent Bank or with one (1) or more Paying Agents an amount of money sufficient to redeem on the Redemption Date all the Securities, or portions thereof, with respect to which the notice of redemption has been given, together with accrued and unpaid interest to the date fixed for redemption. The amount of any redemption at the option of the Holder under this Section 304 shall be paid by check sent to the Holder at such Holder’s registered address, provided that the Company may establish from time to time additional methods that may be elected by the Holder for this payment of such redemption amount.

Section 305. Redemption by Offsetting Application of Fees.

The Company may from time to time redeem, without prior notice to any Holder, all or a portion of the Securities of a Holder in an amount equal to any applicable fees established under the Plan that are then owed by such Holder. In such instance, the redemption proceeds shall be deemed paid by reducing the principal amount of such Holder’s Securities by the amount of such unpaid fees, which reduction shall be applied to the payment of such fees. Such redemption shall be effective upon notice from the Company to the Agent Bank, and the date of such notice shall be the Redemption Date for the redemption of such amount of the Securities. On the Redemption Date any interest on the portion of the Securities so called for redemption shall cease to accrue. Notice of such redemptions shall be provided to any such Holder in the manner and at the times as determined from time to time by the Committee.

ARTICLE FOUR

SATISFACTION AND DISCHARGE OF INDENTURE

Section 401. Satisfaction and Discharge of Indenture.

If at any time (a) the Company shall have terminated the Plan pursuant to its provisions, (b) all the Securities shall have become due and payable, (c) the Company shall have deposited or caused to be deposited with the Trustee as trust funds the entire amount sufficient to pay all the Securities (other than Securities for whose payment money has theretofore been deposited in trust and thereafter repaid to the Company as provided in Section 1003), including principal and interest due or to become due to such date of maturity or, if the Company shall have given notice for the full redemption of all outstanding Securities, the date of redemption, and (d) the Company shall have paid or caused to be paid all other sums payable hereunder by the Company, then this Indenture shall cease to be of further effect, and the Trustee, on demand of and at the cost and expense of the Company shall execute proper instruments acknowledging satisfaction of and discharging this Indenture. The Company agrees to reimburse the Trustee for any costs or expenses thereafter reasonably and properly incurred by the Trustee in connection with this Indenture, the Plan or the Securities.

 

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Section 402. Application of Trust Money.

All moneys deposited with the Trustee pursuant to Section 401 shall be held in trust and applied by it to the payment, either directly or through any Paying Agent, to the Holders of the Securities for the payment of which such moneys have been deposited with the Trustee of all sums due and to become due thereon for principal and interest. The Trustee shall be under no obligation to invest or pay interest on any moneys so held in trust.

ARTICLE FIVE

REMEDIES

Section 501. Events of Default.

“Events of Default” means any one (1) of the following events (whatever the reason for such Event of Default and whether it shall be voluntary or involuntary or be effected by operation of law or pursuant to any judgment, decree or order of any court or any order, rule or regulation of any administrative or governmental body):

(1) default in the payment of any part of or all the principal of or interest on any Security as and when the same shall be due and payable, in accordance with the then current provisions and rules and regulations of the Plan and this Indenture; provided, however, that (a) the failure of the Company to make any payment of the principal of or interest on any Security, or any delay in making such payment shall not be considered in determining whether an “Event of Default” shall have occurred if (i) the Agent Bank in good faith believes that the Security is subject to a conflicting claim, attachment, lien or proceeding, or any person demanding such payment is not, or may not be, legally entitled thereto, or the amount of the payment demanded exceeds the principal amount of the Security according to the Security Register, or the demand for payment has not been made in accordance with the then current provisions and rules and regulations of the Plan, or the payment cannot be made in accordance with the then current provisions and rules and regulations of the Plan or (ii) the Company shall have paid over to the Trustee for deposit to an account not subject to offset, charge or encumbrance by the Trustee the amount of the principal of or interest on any Security which has become due and payable, and if requested by the Trustee the Company shall have furnished the Trustee with an Officers’ Certificates as to the matters described in the foregoing clauses (i) and (ii); and (b) an administrative error relating to a Security or improperly identifying the Security of a Holder shall not be considered in determining whether an “Event of Default” shall have occurred unless such error shall have continued uncorrected for a period of sixty (60) days after written notification thereof to the Agent Bank and the Trustee by the related Holder; or

(2) default in the performance, or breach, of any covenant of the Company in this Indenture (other than a default referred to in clause (1) above), and continuance of such default or breach for a period of sixty (60) days after there has been given, by registered or certified mail, to the Company by the Trustee or to the Company and the Trustee by the Holders of at least a majority in principal amount of the Outstanding Securities a written notice specifying such default or breach and requiring it to be remedied and stating that such notice is a “Notice of Default” hereunder.

 

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Section 502. Acceleration of Maturity; Rescission and Annulment.

If an Event of Default occurs and is continuing, then in every such case the Trustee or the Holders of not less than a majority in the principal amount of the Outstanding Securities may declare all of the Securities to be due and payable immediately, by a notice in writing to the Company (and to the Trustee if given by Holders), and upon any such declaration such principal amount shall become immediately due and payable.

At any time after such a declaration of acceleration with respect to the Securities has been made and before a judgment or decree for payment of the money due has been obtained by the Trustee as hereinafter in this Article provided, the Holders of a majority in principal amount of the Outstanding Securities, by written notice to the Company and the Trustee, may rescind and annul such declaration and its consequences if

(1) the Company has paid or deposited with the Trustee a sum sufficient to pay

(A) the principal of any Securities which have become due otherwise than by such declaration of acceleration and interest thereon at the rate or rates prescribed therefor in such Securities;

(B) to the extent that payment of such interest is lawful, interest upon overdue interest at the rate or rates prescribed therefor in such Securities; and

(C) all sums paid or advanced by the Trustee hereunder and the reasonable compensation expenses, disbursements and advances of the Trustee, its agents and counsel;

and

(2) all Events of Default with respect to the Securities, other than the non-payment of the principal of Securities which have become due solely by such declaration of acceleration, have been cured or waived as provided in Section 513.

No such rescission shall affect any subsequent default or impair any right consequent thereon.

Section 503. Collection of Indebtedness and Suits for Enforcement by Trustee.

The Company covenants that if default is made in the payment of the principal of or interest on any Security when the same shall have become due and payable the Company will, upon demand of the Trustee, pay to it, for the benefit of the Holders of such Securities, the whole amount then due and payable on such Securities for principal and interest and, to the extent that payment of such interest shall be legally enforceable, interest on any overdue principal and on any overdue interest, at the rate or rates prescribed therefor in such Securities, and, in addition thereto, such further amount as shall be sufficient to cover the costs and expenses of collection, including the reasonable compensation, expenses, disbursements and advances of the Trustee, its agents and counsel.

 

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If the Company fails to pay such amounts forthwith upon such demand, the Trustee, in its own name and as trustee of an express trust, may institute a judicial proceeding for the collection of the sums so due and unpaid, may prosecute such proceeding to judgment or final decree and may enforce the same against the Company or any other obligor upon such Securities and collect the moneys adjudged or decreed to be payable in the manner provided by law out of the property of the Company or any other obligor upon such Securities, wherever situated.

If an Event of Default occurs and is continuing, the Trustee may in its discretion proceed to protect and enforce its rights and the rights of the Holders of the Securities by such appropriate judicial proceedings as the Trustee shall deem most effectual to protect and enforce any such rights, whether for the specific enforcement of any covenant or agreement in this Indenture or in aid of the exercise of any power granted herein, or to enforce any other proper remedy.

Section 504. Trustee May File Proofs of Claim.

In case of the pendency of any receivership, insolvency, liquidation, bankruptcy, reorganization, arrangement, adjustment, composition or other judicial proceeding relative to the Company or any other obligor upon the Securities or the property of the Company or of such other obligor or their creditors, the Trustee (irrespective of whether the principal of the Securities shall then be due and payable as therein expressed or by declaration or otherwise and irrespective of whether the Trustee shall have made any demand on the Company for the payment of overdue principal or interest) shall be entitled and empowered, by intervention in such proceeding or otherwise,

(i) to file and prove a claim for the whole amount of principal and interest owing and unpaid in respect of the Securities and to file such other papers or documents as may be necessary or advisable in order to have the claims of the Trustee (including any claim for the reasonable compensation, expenses, disbursements and advances of the Trustee and any predecessor Trustee, their agents and counsel) and of the Holders allowed in such judicial proceeding, and

(ii) to collect and receive any moneys or other property payable or deliverable on any such claims and to distribute the same;

and any custodian, receiver, assignee, trustee, liquidator, sequestrator or other similar official in any such judicial proceeding is hereby authorized by each Holder to make such payments to the Trustee and, in the event that the Trustee shall consent to the making of such payments directly to the Holders, to pay to the Trustee any amount due it for the reasonable compensation, expenses, disbursements and advances of the Trustee and any predecessor Trustee, their agents and counsel, and any other amounts due the Trustee and any predecessor Trustee under Section 607.

Nothing herein contained shall be deemed to authorize the Trustee to authorize or consent to or accept or adopt on behalf of any Holder any plan of reorganization, arrangement, adjustment or composition affecting the Securities or the rights of any Holder thereof or to authorize the Trustee to vote in respect of the claim of any Holder in any such proceeding.

 

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Section 505. Trustee May Enforce Claims Without Possession of Securities.

All rights of action and claims under this Indenture or the Securities may be prosecuted and enforced by the Trustee without the possession of any of the Securities or the production thereof in any proceeding relating thereto, and any such proceeding instituted by the Trustee shall be brought in its own name as trustee of an express trust, and any recovery of judgment shall, after provision for the payment of the reasonable compensation, expenses, disbursements and advances of the Trustee, its agents and counsel, be for the ratable benefit of the Holders of the Securities.

Section 506. Application of Money Collected.

Any money collected by the Trustee pursuant to this Article shall be applied in the following order, at the date or dates fixed by the Trustee:

FIRST: To the payment of all amounts due the Trustee and any predecessor Trustee under Section 607; and

SECOND: To the payment of the amounts then due and unpaid for principal of and interest on the Securities in respect of which or for the benefit of which such money has been collected, ratably, without preference or priority of any kind, according to the amounts due and payable on such Securities for principal and interest, respectively.

Section 507. Limitation on Suits.

No Holder of any Security shall have any right to institute any proceeding, judicial or otherwise, with respect to this Indenture, or for the appointment of a receiver or trustee, or for any other remedy hereunder, unless

(1) such Holder has previously given written notice to the Trustee of a continuing Event of Default;

(2) the Holders of not less than a majority in principal amount of the Outstanding Securities shall have made written request to the Trustee to institute proceedings in respect of such Event of Default in its own name as Trustee hereunder;

(3) such Holder or Holders have offered to the Trustee indemnity or security reasonably satisfactory to it against the costs, expenses and liabilities to be incurred in compliance with such request;

(4) the Trustee for sixty (60) days after its receipt of such notice, request and offer of indemnity has failed to institute any such proceeding; and

(5) no direction inconsistent with such written request has been given to the Trustee during such sixty (60)-day period by the Holders of a majority in principal amount of the Outstanding Securities;

 

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it being understood and intended that no one (1) or more of such Holders shall have any right in any manner whatever by virtue of, or by availing of, any provision of this Indenture to affect, disturb or prejudice the rights of any other of such Holders, or to obtain or to seek to obtain priority or preference over any other of such Holders or to enforce any right under this Indenture, except in the manner herein provided and for the equal and ratable benefit of all such Holders.

Section 508. Unconditional Right of Holders to Receive Principal, Premium and Interest.

Notwithstanding any other provision in this Indenture, the Holder of any Security shall have the right, which is absolute and unconditional, to receive payment pursuant to the Plan of the principal of and interest on such Security on the applicable due date provided therefor (or, in the case of redemption, on the Redemption Date), less applicable fees established under the Plan to which the Holders shall be deemed to consent, and to institute suit for the enforcement of any such payment, and such rights shall not be impaired or affected without the consent of such Holder.

Section 509. Restoration of Rights and Remedies.

If the Trustee or any Holder has instituted any proceeding to enforce any right or remedy under this Indenture and such proceeding has been discontinued or abandoned for any reason, or has been determined adversely to the Trustee or to such Holder, then and in every such case, subject to any determination in such proceeding, the Company, the Trustee and the Holders shall be restored severally and respectively to their former positions hereunder and thereafter all rights and remedies of the Trustee and the Holders shall continue as though no such proceeding had been instituted.

Section 510. Rights and Remedies Cumulative.

No right or remedy herein conferred upon or reserved to the Trustee or to the Holders is intended to be exclusive of any other right or remedy, and every right and remedy shall, to the extent permitted by law, be cumulative and in addition to every other right and remedy given hereunder or now or hereafter existing at law or in equity or otherwise. The assertion or employment of any right or remedy hereunder, or otherwise, shall not prevent the concurrent assertion or employment of any other appropriate right or remedy.

Section 511. Delay or Omission Not Waiver.

No delay or omission of the Trustee or of any Holder of any Securities to exercise any right or remedy accruing upon any Event of Default shall impair any such right or remedy or constitute a waiver of any such Event of Default or an acquiescence therein. Every right and remedy given by this Article or by law to the Trustee or to the Holders may be exercised from time to time, and as often as may be deemed expedient, by the Trustee or by the Holders, as the case may be.

Section 512. Control by Holders.

The Holders of a majority in principal amount of the Outstanding Securities shall have the right to direct the time, method and place of conducting any proceeding for any remedy

 

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available to the Trustee, or exercising any trust or power conferred on the Trustee, with respect to the Securities, provided that

(1) such direction shall not be in conflict with any rule of law or with this Indenture,

(2) subject to Section 601, the Trustee shall have the right to decline to follow any such direction if the Trustee shall reasonably determine, in good faith, that the action or proceeding so directed would be unjustly prejudicial to any Holders not joining in such direction or would involve the Trustee in any personal liability unless indemnified to its reasonable satisfaction, and

(3) the Trustee may take any other action deemed proper by the Trustee which is not inconsistent with such direction.

Section 513. Waiver of Past Defaults.

The Holders of not less than a majority in principal amount of the Outstanding Securities may on behalf of the Holders of all the Securities waive any past default hereunder and its consequences, except a default

(1) in the payment of the principal of or interest on any Security, or

(2) in respect of a covenant or provision hereof which under Article Nine cannot be modified or amended without the consent of the Holder of each Outstanding Security affected.

Upon any such waiver, such default shall cease to exist, and any Event of Default arising therefrom shall be deemed to have been cured, for every purpose of this Indenture; but no such waiver shall extend to any subsequent or other default or impair any right consequent thereon.

Section 514. Undertaking for Costs.

All parties to this Indenture agree, and each Holder of any Security by his acceptance thereof shall be deemed to have agreed, that any court may in its discretion require, in any suit for the enforcement of any right or remedy under this Indenture, or in any suit against the Trustee for any action taken, suffered or omitted by it as Trustee, the filing by any party litigant in such suit of an undertaking to pay the costs of such suit, and that such court may in its discretion assess reasonable costs, including reasonable attorneys’ fees, against any party litigant in such suit, having due regard to the merits and good faith of the claims or defenses made by such party litigant; but the provisions of this Section shall not apply to any suit instituted by the Company, to any suit instituted by the Trustee, to any suit instituted by any Holder, or group of Holders, holding in the aggregate more than 10% in principal amount of the Outstanding Securities, or to any suit instituted by any Holder for the enforcement of the payment of the principal of or interest on the Security on or after the applicable due date therefor provided pursuant to the Plan (or, in the case of redemption, on or after the Redemption Date).

 

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Section 515. Waiver of Stay or Extension Laws.

The Company covenants (to the extent that it may lawfully do so) that it will not at any time insist upon, or plead, or in any manner whatsoever claim or take the benefit or advantage of, any stay or extension law wherever enacted, now or any time hereafter in force, which may affect the covenants or the performance of this Indenture; and the Company (to the extent that it may lawfully do so) hereby expressly waives all benefit or advantage of any such law and covenants that it will not hinder, delay or impede the execution of any power herein granted to the Trustee, but will suffer and permit the execution of every such power as though no such law had been enacted.

ARTICLE SIX

THE TRUSTEE

Section 601. Certain Duties and Responsibilities.

(a) Except during the continuance of an Event of Default,

(1) the Trustee undertakes to perform such duties and only such duties as are specifically set forth in this Indenture, and no implied covenants or obligations shall be read into this Indenture against the Trustee; and

(2) in the absence of bad faith on its part, the Trustee may conclusively rely, as to the truth of the statements and the correctness of the opinions expressed therein, upon certificates or opinions furnished to the Trustee and conforming to the requirements of the Indenture; but in the case of any such certificates or opinions which by any provision hereof are specifically required to be furnished to the Trustee, the Trustee shall be under a duty to examine the same to determine whether or not they conform to the requirements of this Indenture (but need not confirm or investigate the accuracy of any mathematical calculations or other facts, statements, opinions or conclusions stated therein).

(b) In case an Event of Default has occurred and is continuing, the Trustee shall exercise such of the rights and powers vested in it by this Indenture, and use the same degree of care and skill in their exercise, as a prudent man would exercise or use under the circumstances in the conduct of his own affairs.

(c) No provision of this Indenture shall be construed to relieve the Trustee from liability for its own negligent action, its own negligent failure to act, or its own willful misconduct, except that

(1) this Subsection shall not be construed to limit the effect of Subsection (a) of this Section;

(2) the Trustee shall not be liable for any error of judgment made in good faith by a Responsible Officer, unless it shall be proved that the Trustee was negligent in ascertaining the pertinent facts;

 

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(3) the Trustee shall not be liable with respect to any action taken or omitted to be taken by it in good faith in accordance with the direction of the Holders of a majority in principal amount of the Outstanding Securities, determined as provided in Section 512, relating to the time, method and place of conducting any proceeding for any remedy available to the Trustee, or exercising any trust or power conferred upon the Trustee, under this Indenture with respect to the Securities; and

(4) no provision of this Indenture shall require the Trustee to expend or risk its own funds or otherwise incur any financial liability in the performance of any of its duties hereunder, or in the exercise of any of its rights or powers, if it shall have reasonable grounds for believing that repayment of such funds or adequate indemnity against such risk or liability is not reasonably assured to it.

(d) Whether or not therein expressly so provided, every provision of this Indenture relating to the conduct or affecting the liability of or affording protection to the Trustee shall be subject to the provisions of this Section.

Section 602. Notice of Defaults.

Within 90 days after the occurrence of any default hereunder with respect to the Securities, the Trustee shall transmit by mail to all Holders of Securities, as their names and addresses appear in the Security Register, notice of such default hereunder known to the Trustee, unless such default shall have been cured or waived: provided, however, that, except in the case of a default in the payment of the principal of or interest on any Security, the Trustee shall be protected in withholding such notice if and so long as Responsible Officers of the Trustee in good faith determine that the withholding of such notice is in the interest of the Holders of Securities; and provided, further, that in the case of any default of the character specified in Section 501(2) with respect to the Securities, no such notice to Holders shall be given until at least thirty (30) days after the occurrence thereof. For the purpose of this Section, the term “default” means any event which is, or after notice or lapse of time or both would become, an Event of Default.

Section 603. Certain Rights of Trustee.

Subject to the provisions of Section 601:

(a) the Trustee may rely and shall be protected in acting or refraining from acting upon any resolution, certificate, statement, instrument, opinion, report, notice, request, direction, consent, order, bond, debenture, note, other evidence of indebtedness or other paper or document reasonably believed by it to be genuine and to have been signed or presented by the proper party or parties;

(b) any request or direction of the Company mentioned herein shall be sufficiently evidenced by a Company Request or Company Order and any resolution of the Company may be sufficiently evidenced by a Board Resolution;

(c) whenever in the administration of this Indenture the Trustee shall deem it desirable that a matter be proved or established prior to taking, suffering or omitting any action hereunder, the Trustee (unless other evidence be herein specifically prescribed) may, in the absence of bad faith on its part, rely upon an Officers’ Certificate;

 

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(d) the Trustee may consult with counsel of its selection and the advice of such counsel or any Opinion of Counsel shall be full and complete authorization and protection in respect of any action taken, suffered or omitted by it hereunder in good faith and in reliance thereon;

(e) the Trustee shall be under no obligation to exercise any of the rights or powers vested in it by this Indenture at the request or direction of any of the Holders pursuant to this Indenture, unless such Holders shall have offered to the Trustee security or indemnity reasonably satisfactory to the Trustee against the costs, expenses and liabilities which might be incurred by it in compliance with such request or direction;

(f) the Trustee shall not be bound to make any investigation into the facts or matters stated in any resolution, certificate, statement, instrument, opinion, report, notice, request, direction, consent, order, bond, debenture, note, other evidence of indebtedness or other paper or document, but the Trustee, in its discretion, may make such further inquiry or investigation into such facts or matters as it may see fit;

(g) the Trustee may execute any of the trusts or powers hereunder or perform any duties hereunder either directly or by or through agents or attorneys and the Trustee shall not be responsible for any misconduct or negligence on the part of any agent or attorney appointed with due care by it hereunder;

(h) the Trustee shall not be liable for any action taken, suffered or omitted by it in good faith and believed by it to be authorized or within the discretion or rights or powers conferred upon it by the Indenture;

(i) the Trustee may request that the Company deliver an Officers’ Certificate setting forth the names of individuals and/or titles of officers authorized at such time to take specified actions pursuant to this Indenture, which Officers’ Certificate may be signed by any person authorized to sign an Officers’ Certificate, including any person specified as so authorized in any such certificate previously delivered and not superseded;

(j) in no event shall the Trustee be responsible or liable for special, indirect, or consequential loss or damage of any kind whatsoever (including, but not limited to, loss of profit) irrespective of whether the Trustee has been advised of the likelihood of such loss or damage and regardless of the form of action;

(k) the Trustee shall not be charged with knowledge of any default hereunder or any Event of Default unless either (i) a Responsible Officer of the Trustee shall have actual knowledge of such default or Event of Default or (ii) written notice of such default or Event of Default shall have been given to the Trustee by the Company or by any Holder of the Securities and such notice references the Indenture and the Securities;

(l) in no event shall the Trustee be responsible or liable for any failure or delay in the performance of its obligations hereunder arising out of or caused by, directly or indirectly, forces

 

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beyond its control, including, without limitation, strikes, work stoppages, accidents, acts of war or terrorism, civil or military disturbances, nuclear or natural catastrophes or acts of God, and interruptions, loss or malfunctions of utilities, communications or computer (software and hardware) services; it being understood that the Trustee shall use reasonable efforts which are consistent with accepted practices in the banking industry to resume performance as soon as practicable under the circumstances;

(m) the rights, privileges, protections, immunities and benefits given to the Trustee, including, without limitation, its right to be indemnified, are extended to, and shall be enforceable by, the Trustee in each of its capacities hereunder and by any other agent or custodian employed to act hereunder; and

(n) in no event shall the Trustee be liable for the misconduct or negligence or for any acts or omissions of the Agent Bank.

Section 604. Not Responsible for Recitals or Issuance of Securities.

The recitals contained herein shall be taken as the statements of the Company, and the Trustee assumes no responsibility for their correctness. The Trustee makes no representations as to the validity or sufficiency of this Indenture or of the Securities. The Trustee shall not be accountable for the use or application by the Company of Securities or the proceeds thereof.

Section 605. May Hold Securities.

Subject to the provisions of the Plan with respect to Persons who may hold Securities, the Trustee, the Agent Bank, any Paying Agent, any Security Registrar or any other agent of the Company, in its individual or any other capacity, may become the owner of Securities and, subject to Section 608 and the provisions of the Trust Indenture Act, may otherwise deal with the Company with the same rights it would have if it were not Trustee, Agent Bank, Paying Agent, Security Registrar or such other agent.

Section 606. Money Held in Trust.

Money held by the Trustee in trust hereunder need not be segregated from other funds except to the extent required by law. The Trustee shall be under no liability for interest on any money received by it hereunder except as otherwise agreed with the Company.

Section 607. Compensation and Reimbursement.

The Company agrees:

(1) to pay to the Trustee from time to time such compensation as shall be agreed to in writing between the Company and the Trustee for all services rendered by it hereunder (which compensation shall not be limited by any provision of law in regard to the compensation of a trustee of an express trust);

(2) except as otherwise expressly provided herein, to reimburse the Trustee upon its request for all reasonable expenses, disbursements and advances incurred or

 

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made by the Trustee in accordance with any provision of this Indenture (including the reasonable compensation and the expenses and disbursements of its counsel), except any such expense, disbursement or advance as may be determined to have been caused by its own negligence or willful misconduct; and

(3) to indemnify each of the Trustee and any predecessor Trustee for, and to hold it harmless against, any loss, liability or expense incurred without negligence or willful misconduct on its part, arising out of or in connection with the acceptance or administration of the trust or trusts hereunder or the performance of its duties hereunder, including the costs and expenses of defending itself against any claim or liability in connection with the exercise or performance of any of its powers or duties hereunder.

The Trustee shall have a lien prior to the Securities upon all property and funds held by it hereunder for any amount owing it or any predecessor Trustee pursuant to this Section 607, except with respect to funds held in trust for the benefit of the Holders of particular Securities.

The provisions of this Section shall survive the satisfaction and discharge of this Indenture and the resignation or removal of the Trustee.

Section 608. Disqualification; Conflicting Interests.

The Trustee shall be subject to the provisions of Section 310(b) of the Trustee Indenture Act during the period of time provided for therein. Nothing herein shall prevent the Trustee from filing with the Commission the application referred to in the second-to-last paragraph of Section 310(b) of the Trust Indenture Act.

Section 609. Corporate Trustee Required; Eligibility.

There shall at all times be a Trustee hereunder which shall be a corporation organized and doing business under the laws of the United States of America, any State thereof or the District of Columbia, authorized under such laws to exercise corporate trust powers, having a combined capital and surplus of at least $50,000,000, subject to supervision or examination by Federal or State authority; provided, however, that if Section 310(a) of the Trust Indenture Act or the rules and regulations of the Commission under the Trust Indenture Act at any time permit a corporation organized and doing business under the laws of any other jurisdiction to serve as trustee of an indenture qualified under the Trust Indenture Act, this Section 609 shall be automatically amended to permit a corporation organized and doing business under the laws of any such other jurisdiction to serve as Trustee hereunder. If such corporation publishes reports of condition at least annually, pursuant to law or to the requirements of said supervising or examining authority, then for the purposes of this Section, the combined capital and surplus of such corporation shall be deemed to be its combined capital and surplus as set forth in its most recent report of condition so published. Neither the Company nor any person directly or indirectly controlling, controlled by or under common control with the Company may serve as Trustee. If at any time the Trustee shall cease to be eligible in accordance with the provisions of this Section, it shall resign immediately in the manner and with the effect hereinafter specified in this Article.

 

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Section 610. Resignation and Removal; Appointment of Successor.

(a) No resignation or removal of the Trustee and no appointment of a successor Trustee pursuant to this Article shall become effective until the acceptance of appointment by the successor Trustee in accordance with the applicable requirements of Section 611.

(b) The Trustee may resign at any time by giving written notice thereof to the Company. If the instrument of acceptance by a successor Trustee required by Section 611 shall not have been delivered to the Trustee within thirty (30) days after the giving of such notice of resignation, the resigning Trustee may petition any court of competent jurisdiction for the appointment of a successor Trustee.

(c) The Trustee may be removed at any time by Act of the Holders of a majority in principal amount of the Outstanding Securities, delivered to the Trustee and to the Company.

(d) If at any time:

(1) the Trustee shall fail to comply with Section 608 after written request therefor by the Company or by any Holder who has been a bona fide Holder of a Security for at least six (6) months, unless the Trustee’s duty to resign has been stayed as provided in Section 310(b) of the Trust Indenture Act, or

(2) the Trustee shall cease to be eligible under Section 609 and shall fail to resign after written request therefor by the Company or by any such Holder, or

(3) the Trustee shall become incapable of acting or shall be adjudged a bankrupt or insolvent or a receiver of the Trustee or of its property shall be appointed or any public officer shall take charge or control of the Trustee or of its property or affairs for the purpose of rehabilitation, conservation or liquidation,

then, in any case, (i) the Company by a Board Resolution may remove the Trustee, or (ii) subject to Section 514, any Holder who has been a bona fide Holder of a Security for at least six (6) months may, on behalf of himself and all others similarly situated, petition any court of competent jurisdiction for the removal of the Trustee and the appointment of a successor Trustee.

(e) If the Trustee shall resign, be removed or become incapable of acting, or if a vacancy shall occur in the office of Trustee for any cause, the Company, by a Board Resolution, shall promptly appoint a successor Trustee and shall comply with the applicable requirements of Section 611. If, within one (1) year after such resignation, removal or incapability, or the occurrence of such vacancy, a successor Trustee shall be appointed by Act of the Holders of a majority in principal amount of the Outstanding Securities delivered to the Company and the retiring Trustee, the successor Trustee so appointed shall, forthwith upon its acceptance of such appointment in accordance with the applicable requirements of Section 611, become the successor Trustee and to that extent supersede the successor Trustee appointed by the Company. If no successor Trustee shall have been so appointed by the Company or the Holders and accepted appointment in the manner required by Section 611, any Holder who has been a bona fide Holder of a Security for at least six (6) months may, on behalf of himself and all others similarly situated, petition any court of competent jurisdiction for the appointment of a successor Trustee.

 

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(f) The Company shall give notice of each resignation and each removal of the Trustee and each appointment of a successor Trustee by mailing written notice of such event by first-class mail, postage prepaid, to all Holders of Securities as their names and addresses appear in the Security Register. Each notice shall include the name of the successor Trustee and the address of its Corporate Trust Office.

Section 611. Acceptance of Appointment by Successor.

(a) In case of the appointment hereunder of a successor Trustee, every such successor Trustee so appointed shall execute, acknowledge and deliver to the Company and to the retiring Trustee an instrument accepting such appointment, and thereupon the resignation or removal of the retiring Trustee shall become effective and such successor Trustee, without any further act, deed or conveyance, shall become vested with all the rights, powers, trusts and duties of the retiring Trustee; but, on the request of the Company or the successor Trustee, such retiring Trustee shall, upon payment of its charges, execute and deliver an instrument transferring to such successor Trustee all the rights, powers and trusts of the retiring Trustee and shall duly assign, transfer and deliver to such successor Trustee all property and money held by such retiring Trustee hereunder.

(b) Upon request of any such successor Trustee, the Company shall execute any and all instruments for more fully and certainly vesting in and confirming to such successor Trustee all such rights, powers and trusts referred to in paragraph (a) of this Section.

(c) No successor Trustee shall accept its appointment unless at the time of such acceptance such successor Trustee shall be qualified and eligible under this Article.

Section 612. Merger, Conversion, Consolidation or Succession to Business.

Any corporation into which the Trustee may be merged or converted or with which it may be consolidated, or any corporation resulting from any merger, conversion or consolidation to which the Trustee shall be a party, or any corporation succeeding to all or substantially all the corporate trust business of the Trustee, shall be the successor of the Trustee hereunder, provided such corporation shall be otherwise qualified and eligible under this Article, without the execution or filing of any paper or any further act on the part of any of the parties hereto.

Section 613. Preferential Collection of Claims Against Company.

(a) Subject to Subsection (b) of this Section, if the Trustee shall be or shall become a creditor, directly or indirectly, secured or unsecured, of the Company within three months prior to a default, as defined in Subsection (c) of this Section, or subsequent to such a default, then, unless and until such default shall be cured, the Trustee shall set apart and hold in a special account for the benefit of the Trustee individually, the Holders of the Securities and the holders of other indenture securities, as defined in Subsection (c) of this Section:

 

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(1) an amount equal to any and all reductions in the amount due and owing upon any claim as such creditor in respect of principal or interest, effected after the beginning of such three months’ period and valid as against the Company and its other creditors, except any such reduction resulting from the receipt or disposition of any property described in paragraph (2) of this Subsection, or from the exercise of any right of set-off which the Trustee could have exercised if a petition in bankruptcy had been filed by or against the Company upon the date of such default; and

(2) all property received by the Trustee in respect of any claims as such creditor, either as security therefor, or in satisfaction or composition thereof, or otherwise, after the beginning of such three (3) months’ period, or an amount equal to the proceeds of any such property, if disposed of, subject, however, to the rights, if any, of the Company and its other creditors in such property or such proceeds.

Nothing herein contained, however, shall affect the right of the Trustee:

(A) to retain for its own account (i) payments made on account of any such claim by any Person (other than the Company) who is liable thereon, and (ii) the proceeds of the bona fide sale of any such claim by the Trustee to a third Person, and (iii) distributions made in cash, securities or other property in respect of claims filed against the Company in bankruptcy or receivership or in proceedings for reorganization pursuant to the Federal Bankruptcy Code or applicable State law;

(B) to realize, for its own account, upon any property held by it as security for any such claim, if such property was so held prior to the beginning of such three (3) months’ period;

(C) to realize, for its own account, but only to the extent of the claim hereinafter mentioned, upon any property held by it as security for any such claim, if such claim was created after the beginning of such three months’ period and such property was received as security therefor simultaneously with the creation thereof, and if the Trustee shall sustain the burden of proving that at the time such property was received the Trustee had no reasonable cause to believe that a default, as defined in Subsection (c) of this Section, would occur within three months; or

(D) to receive payment on any claim referred to in paragraph (B) or (C), against the release of any property held as security for such claim as provided in paragraph (B) or (C), as the case may be, to the extent of the fair value of such property.

For the purposes of paragraphs (B), (C) and (D), property substituted after the beginning of such three (3) months’ period for property held as security at the time of such substitution shall, to the extent of the fair value of the property released, have the same status as the property released, and, to the extent that any claim referred to in any of such paragraphs is created in renewal of or in substitution for or for the purpose of repaying or refunding any pre-existing claim of the Trustee as such creditor, such claim shall have the same status as such pre-existing claim.

 

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If the Trustee shall be required to account, the funds and property held in such special account and the proceeds thereof shall be apportioned among the Trustee, the Holders and the holders of other indenture securities in such manner that the Trustee, the Holders and the holders of other indenture securities realize, as a result of payments from such special account and payments of dividends on claims filed against the Company in bankruptcy or receivership or in proceedings for reorganization pursuant to the Federal Bankruptcy Code or applicable State law, the same percentage of their respective claims, figured before crediting to the claim of the Trustee anything on account of the receipt by it from the Company of the funds and property in such special account and before crediting to the respective claims of the Trustee and the Holders and the holders of other indenture securities dividends on claims filed against the Company in bankruptcy or receivership or in proceedings for reorganization pursuant to the federal Bankruptcy Code or applicable State law, but after crediting thereon receipts on account of the indebtedness represented by their respective claims from all sources other than from such dividends and from the funds and property so held in such special account. As used in this paragraph, with respect to any claim, the term “dividends” shall include any distribution with respect to such claim, in bankruptcy or receivership or proceedings for reorganization pursuant to the Federal Bankruptcy Code or applicable State law, whether such distribution is made in cash, securities or other property, but shall not include any such distribution with respect to the secured portion, if any, of such claim. The court in which such bankruptcy, receivership or proceedings for reorganization is pending shall have jurisdiction (i) to apportion among the Trustee, the Holders and the holders of other indenture securities, in accordance with the provisions of this paragraph, the funds and property held in such special account and proceeds thereof, or (ii) in lieu of such apportionment, in whole or in part, to give to the provisions of this paragraph due consideration in determining the fairness of the distributions to be made to the Trustee and the Holders and the holders of other indenture securities with respect to their respective claims, in which event it shall not be necessary to liquidate or to appraise the value of any securities or other property held in such special account or as security for any such claim, or to make a specific allocation of such distributions as between the secured and unsecured portions of such claims, or otherwise to apply the provisions of this paragraph as a mathematical formula.

Any Trustee which has resigned or been removed after the beginning of such three (3) months’ period shall be subject to the provisions of this Subsection as though such resignation or removal had not occurred. If any Trustee has resigned or been removed prior to the beginning of such three months’ period, it shall be subject to the provisions of this Subsection if and only if the following conditions exist:

(i) the receipt of property or reduction of claim, which would have given rise to the obligation to account, if such Trustee had continued as Trustee, occurred after the beginning of such three (3) months’ period; and

(ii) such receipt of property or reduction of claim occurred within three months after such resignation or removal.

 

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(b) There shall be excluded from the operation of Subsection (a) of this Section a creditor relationship arising from:

(1) the ownership or acquisition of securities issued under any indenture, or any security or securities having a maturity of one (1) year or more at the time of acquisition by the Trustee;

(2) advances authorized by a receivership or bankruptcy court of competent jurisdiction or by this Indenture, for the purpose of preserving any property which shall at any time be subject to the lien of this Indenture or of discharging tax liens or other prior liens or encumbrances thereon, if notice of such advances and of the circumstances surrounding the making thereof is given to the Holders at the time and in the manner provided in this Indenture;

(3) disbursements made in the ordinary course of business in the capacity of trustee under an indenture, transfer agent, registrar, custodian, paying agent, fiscal agent or depositary, or other similar capacity;

(4) an indebtedness created as a result of services rendered or premises rented; or an indebtedness created as a result of goods or securities sold in a cash transaction, as defined in Subsection (c) of this Section;

(5) the ownership of stock or of other securities of a corporation organized under the provisions of Section 25(a) of the Federal Reserve Act, as amended, which is directly or indirectly a creditor of the Company; and

(6) the acquisition, ownership, acceptance or negotiation of any drafts, bills of exchange, acceptances or obligations which fall within the classification of self-liquidating paper, as defined in Subsection (c) of this Section.

(c) For the purposes of this Section only:

(1) the term “default” means any failure to make payment in full of the principal of or interest on any of the Securities or upon the other indenture securities when and as such principal or interest becomes due and payable;

(2) the term “other indenture securities” means securities upon which the Company is an obligor outstanding under any other indenture (i) under which the Trustee is also trustee, (ii) which contains provisions substantially similar to the provisions of this Section, and (iii) under which a default exists at the time of the apportionment of the funds and property held in such special account;

(3) the term “cash transaction” means any transaction in which full payment for goods or securities sold is made within seven days after delivery of the goods or securities in currency or in checks or other orders drawn upon banks or bankers and payable upon demand;

 

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(4) the term “self-liquidating paper” means any draft, bill of exchange, acceptance or obligation which is made, drawn, negotiated or incurred by the Company for the purpose of financing the purchase, processing, manufacturing, shipment, storage or sale of goods, wares or merchandise and which is secured by documents evidencing title to, possession of, or a lien upon, the goods, wares or merchandise or the receivables or proceeds arising from the sale of the goods, wares or merchandise previously constituting the security, provided the security is received by the Trustee simultaneously with the creation of the creditor relationship with the Company arising from the making, drawing, negotiating or incurring of the draft, bill of exchange, acceptance or obligation;

(5) the term “Company” means any obligor upon the Securities; and

(6) the term “Federal Bankruptcy Code” means the Bankruptcy Code or Title 11 of the United States Code.

ARTICLE SEVEN

HOLDERS’ LIST AND REPORTS BY TRUSTEE AND COMPANY

Section 701. Company to Furnish Trustee Names and Addresses of Holders.

The Company will furnish or cause to be furnished to the Trustee

(a) semi-annually, not later than February 1 and August 1 in each year, a list, in such form as the Trustee may reasonably require, of the names and addresses of the Holders as of the preceding January 15 or July 15, as the case may be and

(b) at such other times as the Trustee may request in writing, within thirty (30) days after the receipt by the Company of any such request, a list of similar form and content as of a date not more than fifteen (15) days prior to the time such list is furnished.

excluding from any such list names and addresses received by the Trustee in its capacity as Security Registrar, if then so acting.

Section 702. Preservation of Information; Communications to Holders.

(a) The Trustee shall preserve, in as current a form as is reasonably practicable, the names and addresses of Holders contained in the most recent list furnished to the Trustee as provided in Section 701 and the names and addresses of Holders received by the Trustee in its capacity as Security Registrar, if then so acting. The Trustee may destroy any list furnished to it as provided in Section 701 upon receipt of a new list so furnished.

(b) If three or more Holders (herein referred to as “applicants”) apply in writing to the Trustee, and furnish to the Trustee reasonable proof that each such applicant has owned a Security for a period of at least six (6) months preceding the date of such application, and such application states that the applicants desire to communicate with other Holders with respect to their rights under this Indenture or under the Securities and is accompanied by a copy of the form of proxy or other communication which such applicants propose to transmit, then the Trustee shall, within five (5) New York Business Days after the receipt of such application, at its election, either

 

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(i) afford such applicants access to the information preserved at the time by the Trustee in accordance with Section 702(a), or

(ii) inform such applicants as to the approximate number of Holders whose names and addresses appear in the information preserved at the time by the Trustee in accordance with Section 702(a), and as to the approximate cost of mailing to such Holders the form of proxy or other communication, if any, specified in such application.

If the Trustee shall elect not to afford such applicants access to such information, the Trustee shall, upon written request of such applicants, mail to each Holder whose name and address appear in the information preserved at the time by the Trustee in accordance with Section 702(a) a copy of the form of proxy or other communication which is specified in such request, with reasonable promptness after a tender to the Trustee of the material to be mailed and of payment, or provision for the payment, of the reasonable expenses of mailing, unless within five (5) days after such tender the Trustee shall mail to such applicants and file with the Commission, together with a copy of the material to be mailed, a written statement to the effect that, in the opinion of the Trustee, such mailing would be contrary to the best interest of the Holders or would be in violation of applicable law. Such written statement shall specify the basis of such opinion. If the Commission, after opportunity for a hearing upon the objections specified in the written statement so filed, shall enter an order refusing to sustain any of such objections or if, after the entry of an order sustaining one (1) or more of such objections, the Commission shall find, after notice and opportunity for hearing, that all the objections so sustained have been met and shall enter an order so declaring, the Trustee shall mail copies of such material to all such Holders with reasonable promptness after the entry of such order and the renewal of such tender; otherwise the Trustee shall be relieved of any obligation or duty to such applicants respecting their application.

(c) Every Holder of Securities, by receiving and holding the same, agrees with the Company and the Trustee that neither the Company nor the Trustee nor any agent of either of them shall be held accountable by reason of the disclosure of any such information as to the names and addresses of the Holders in accordance with Section 702, regardless of the source from which such information was derived, and that the Trustee shall not be held accountable by reason of mailing any material pursuant to a request made under Section 702(b).

Section 703. Reports by Trustee.

(a) Within sixty (60) days after May 15 of each year beginning with the year 2018, the Trustee shall transmit by mail to all Holders, as their names and addresses appear in the Security Register, a brief report dated as of such May 15 with respect to any of the following events which may have occurred within the previous 12 months (but if no such event has occurred within such period, no report need be transmitted):

(1) any change to its eligibility under Section 609 and its qualifications under Section 608;

 

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(2) the creation of or any material change to a relationship specified in Section 310(b)(1) through Section 310(b)(10) of the Trust Indenture Act;

(3) the character and amount of any advances (and if the Trustee elects so to state, the circumstances surrounding the making thereof) made by the Trustee (as such) which remain unpaid on the date of such report, and for the reimbursement of which it claims or may claim a lien or charge, prior to that of the Securities, on any property or funds held or collected by it as Trustee, except that the Trustee shall not be required (but may elect) to report such advances if such advances so remaining unpaid aggregate not more than 1/2 of 1% of the principal amount of the Securities Outstanding on the date of such report;

(4) the amount, interest rate and maturity date of all other indebtedness owing by the Company (or by any other obligor on the Securities) to the Trustee in its individual capacity, on the date of such report, with a brief description of any property held as collateral security therefor, except an indebtedness based upon a creditor relationship arising in a manner described in Section 311(b)(2), (3), (4), or (6) of the Trust Indenture Act;

(5) the property and funds, if any, physically in the possession of the Trustee as such on the date of such report;

(6) any additional issue of Securities which the Trustee has not previously reported (for purposes of this report, all Securities issued under the Plan shall be treated as a single issue of Securities); and

(7) any action taken by the Trustee in the performance of its duties hereunder which it has not previously reported and which in its opinion materially affects the Securities, except action in respect of a default, notice of which has been or is to be withheld by the Trustee in accordance with Section 602.

(b) The Trustee shall transmit by mail to all Holders, as their names and addresses appear in the Security Register, a brief report with respect to the character and amount of any advances (and if the Trustee elects so to state, the circumstances surrounding the making thereof) made by the Trustee (as such) since the date of the last report transmitted pursuant to Subsection (a) of this Section (or if no such report has yet been so transmitted, since the date of execution of this instrument) for the reimbursement of which it claims or may claim a lien or charge, prior to that of the Securities, on property or funds held or collected by it as Trustee and which it has not previously reported pursuant to this Subsection, except that the Trustee shall not be required (but may elect) to report such advances if such advances remaining unpaid at any time aggregate 10% or less of the principal amount of the Securities Outstanding at such time, such report to be transmitted within 90 days after such time.

(c) A copy of each such report shall, at the time of such transmission to Holders, be filed by the Trustee with each stock exchange upon which any Securities are listed, with the Commission and with the Company. The Company will notify the Trustee when any Securities are listed or delisted on any stock exchange.

 

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Section 704. Reports by Company.

The Company, pursuant to Section 314(a) of the Trust Indenture Act, shall:

(1) file with the Trustee, within fifteen (15) days after the Company is required to file the same with the Commission, copies of the annual reports and of the information, documents and other reports (or copies of such portions of any of the foregoing as the Commission may from time to time by rules and regulations prescribe) which the Company may be required to file with the Commission pursuant to Section 13 or Section 15(d) of the Securities Exchange Act of 1934, as amended; or, if the Company is not required to file information, documents or reports pursuant to either of said Sections, then it shall file with the Trustee and the Commission, in accordance with rules and regulations prescribed from time to time by the Commission, such of the supplementary and periodic information, documents and reports which may be required pursuant to Section 13 of the Securities Exchange Act of 1934, as amended, in respect of a security listed and registered on a national securities exchange as may be prescribed from time to time in such rules and regulations;

(2) file with the Trustee and the Commission, in accordance with rules and regulations prescribed from time to time by the Commission, such additional information, documents and reports with respect to compliance by the Company, with the conditions and covenants of this Indenture as may be required from time to time by such rules and regulations; and

(3) transmit within thirty (30) days after the filing thereof with the Trustee, in the manner and to the extent provided in Section 313(c) of the Trust Indenture Act, such summaries of any information, documents and reports required to be filed by the Company pursuant to paragraphs (1) and (2) of this Section as may be required by rules and regulations prescribed from time to time by the Commission.

Delivery of such reports, information and documents to the Trustee is for informational purposes only and the Trustee’s receipt of such shall not constitute constructive notice of any information contained therein or determinable from information contained therein, including the Company’s compliance with any of its covenants hereunder (as to which the Trustee is entitled to rely exclusively on Officers’ Certificates).

All information, documents and reports described in this Section 704 and filed with the Commission pursuant to its Electronic Data Gathering, Analysis, and Retrieval system or any successor system shall be deemed to be filed with the Trustee as of the time they are filed via such system; provided, however, that the Trustee shall have no obligation whatsoever to determine whether or not such information, documents or reports have been filed pursuant to the Electronic Data Gathering, Analysis, and Retrieval system or any successor system.

ARTICLE EIGHT

CONSOLIDATION, MERGER, CONVEYANCE, TRANSFER OR LEASE

Section 801. Company May Consolidate, Etc., on Certain Terms.

Nothing contained in this Indenture or in any of the Securities shall prevent any consolidation or merger of the Company with or into any other Person or Persons (whether or not affiliated with the Company), or successive consolidations or mergers in which the Company or its successor or successors shall be a party or parties, or shall prevent any conveyance, transfer or lease of the properties and assets of the Company as an entirety or substantially as an entirety to any other Person (whether or not affiliated with the Company) lawfully entitled to acquire the

 

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same; provided, however, and the Company hereby covenants and agrees, that upon any such consolidation, merger, conveyance, transfer or lease, (i) the due and punctual payment of the principal of and interest on all of the Securities, according to their tenor, and the due and punctual performance and observance of all of the covenants and conditions of this Indenture to be performed by the Company, shall be expressly assumed, by indenture supplemental hereto, in form satisfactory to the Trustee, executed and delivered to the Trustee by the Person (if other than the Company) formed by such consolidation, or into which the Company shall have been merged, or by the Person which shall have acquired such properties and assets, and (ii) the Company shall deliver to the Trustee an Officers’ Certificate and an Opinion of Counsel, each stating that such consolidation, merger, conveyance, transfer or lease and, if a supplemental indenture is required in connection with such transaction, such supplemental indenture comply with this Article and that all conditions precedent herein provided for relating to such transaction have been complied with.

Section 802. Successor Substituted.

Upon any consolidation of the Company with, or merger of the Company into, any other Person or any conveyance, transfer or lease of the properties and assets of the Company as an entirety or substantially as an entirety in accordance with Section 801, the successor Person formed by such consolidation or into which the Company is merged or to which such conveyance, transfer or lease is made shall succeed to, and be substituted for, and may exercise every right and power of, the Company under this Indenture with the same effect as if such successor Person had been named as the Company herein, and thereafter, except in the case of a lease, the predecessor Person shall be relieved of all obligations and covenants under this Indenture and the Securities.

ARTICLE NINE

SUPPLEMENTAL INDENTURES

Section 901. Supplemental Indentures without Consent of Holders.

Without the consent of any Holders, the Company and the Trustee, at any time and from time to time, may enter into one (1) or more indentures supplemental hereto, in form satisfactory to the Trustee, for any of the following purposes:

(1) to evidence the succession of another Person to the Company and the assumption by any such successor of the covenants of the Company herein and in the Securities; or

(2) to add to the covenants of the Company for the benefit of the Holders of the Securities or to surrender any right or power herein conferred upon the Company; or

(3) to add any additional Events of Default; or

(4) to secure the Securities; or

 

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(5) to reflect any amendments, modifications or other changes to the Plan that by the terms of the Plan or this Indenture may be made at the discretion of the Committee; or

(6) to modify, suspend or eliminate any of provisions herein providing for the right of the Company to redeem, or the right of the Holders to cause the Company to redeem, the Securities; provided, however, that no such modification, suspension or elimination shall affect the right of any Holder unless the Company shall have provided notice of such proposed action to such Holder in sufficient time prior to its effective date to allow such Holder to redeem its Securities in accordance with the terms in effect prior to the effective date of such modification, suspension or elimination, and provided further that no such modification, suspension or elimination may diminish the principal of any Security or unpaid interest on any Security; or

(7) to evidence and provide for the acceptance of appointment hereunder by a successor Trustee, pursuant to the requirements of Section 611; or

(8) to amend or supplement any provision contained herein or in any indenture supplemental hereto to conform the terms of the Indenture or the supplemental indenture to the descriptions thereof appearing in a preliminary prospectus, prospectus, prospectus supplement (including any pricing term sheet), offering memorandum or offering circular relating to the Securities as evidenced by an Officer’s Certificate; or

(9) to cure any ambiguity, or correct or supplement any provision herein which may be defective or inconsistent with any other provision herein, or to make any other provisions with respect to matters or questions arising under this Indenture, provided that such action shall not adversely affect the interests of the Holders of Securities in any material respect.

Section 902. Supplemental Indentures with Consent of Holders.

With the consent of the Holders of not less than a majority in principal amount of the Outstanding Securities, by Act of said Holders delivered to the Company and the Trustee, the Company and the Trustee may enter into an indenture or indentures supplemental hereto for the purpose of adding any provisions to or changing in any manner or eliminating any of the provisions of this Indenture or of modifying in any manner the rights of the Holders of Securities under this Indenture; provided, however, that no such supplemental indenture shall, without the consent of the Holder or each Outstanding Security affected thereby,

(1) change the character of the Securities from being payable on demand or reduce the principal amount of or the unpaid interest on any Security or impair the right to institute suit for the enforcement of any such payment on or after the applicable due date thereof (or, in the case of redemption, on or after the Redemption Date), or

(2) reduce the percentage in principal amount of the Outstanding Securities, the consent of whose Holders is required for any such supplemental indenture, or the consent of whose Holders is required for any waiver of compliance with certain provisions of this Indenture or certain defaults hereunder and their consequences provided for in this Indenture, or

(3) change any obligation of the Company, with respect to Outstanding Securities, to maintain an office or agency for the purposes specified in Section 1002, or

 

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(4) modify any of the provisions of this Section, Section 513 or Section 1005, except to increase any such percentage or to provide that certain other provisions of this Indenture cannot be modified or waived without the consent of the Holder of each Outstanding Security affected thereby.

It shall not be necessary for any Act of Holders under this Section to approve the particular form of any proposed supplemental indenture, but it shall be sufficient if such Act shall approve the substance thereof.

Section 903. Execution of Supplemental Indentures.

In executing, or accepting the additional trusts created by, any supplemental indenture permitted by this Article or the modifications thereby of the trusts created by this Indenture, the Trustee shall receive, and (subject to Section 601) shall be fully protected in relying upon, an Opinion of Counsel stating that the execution of such supplemental indenture is authorized or permitted by this Indenture and is the legal, valid and binding obligation of the Company. The Trustee may, but shall not be obligated to, enter into any such supplemental indenture which affects the Trustee’s own rights, duties or immunities under this Indenture or otherwise.

Section 904. Effect of Supplemental Indentures.

Upon the execution of any supplemental indenture under this Article, this Indenture shall be modified in accordance therewith, and such supplemental indenture shall form a part of this Indenture for all purposes; and every Holder of Securities theretofore or thereafter authenticated and delivered hereunder shall be bound thereby.

Section 905. Conformity with Trust Indenture Act.

Every supplemental indenture executed pursuant to this Article shall conform to the requirements of the Trust Indenture Act as then in effect.

ARTICLE TEN

COVENANTS

Section 1001. Administration of Plan; Payment of Principal and Interest.

(a) The Company covenants and agrees to maintain and administer the Plan and the Securities issued pursuant thereto in accordance with the provisions of the Plan, as the same may from time to time be in force and effect, and this Indenture; provided, however, that nothing herein shall prevent the Company from exercising any of its rights to amend, modify or terminate the Plan, or to adopt, amend or rescind the rules established under the Plan, as provided therein.

(b) The Company covenants and agrees for the benefit or Holders of Securities that it will duly and punctually pay the principal of and interest on the Securities in accordance with the terms of the Plan and this Indenture. Interest will accrue on the Securities in accordance with the provisions of the Plan. The interest rate on the Securities shall be determined in accordance with the provisions of the Plan. Interest rates will vary from time to time. There are no minimum or

 

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maximum interest rates. In the event of a change in the rate of interest to be paid on the Securities, the Company will promptly make available to the Trustee and the Agent Bank the new rate. The failure by the Trustee or the Agent Bank to receive notice of such change shall not affect the validity or effectiveness of such change.

(c) The Company covenants and agrees to maintain (i) a Paying Agent for the purpose of making payments of principal of and interest on the Securities, and (ii) an Agent Bank for the purpose of administering the Plan in accordance with the terms thereof and of the Indenture. The Company will give prompt notice to the Trustee and the Holders of the notice address, and any change in the notice address, of any Paying Agent or the Agent Bank.

Section 1002. Maintenance of Security Register; Maintenance of Office or Agency.

(a) The Company will, or will cause the Agent Bank or another agent of the Company to, keep proper books of record and account in which full and correct entries shall be made of all funds invested in the Securities, together with interest accrued thereon, and all redemptions thereof, and which shall contain the names and addresses of all Holders and the principal amounts of their respective Securities (collectively, the “Security Register”).

(b) The Company will maintain in the City of Richmond, Virginia an office or agency where notices and demands hereunder may be served upon the Company or the Committee, as appropriate, in respect of the Securities and this Indenture. The Company will give prompt written notice to the Trustee and the Holders of the location, and any change in the location, of any such office or agency. If at any time the Company shall fail to maintain any such required office or agency or shall fail to furnish the Trustee with the address thereof, such notices and demands may be made or served at the Corporate Trust Office of the Trustee.

Section 1003. Money for Securities Payments to Be Held in Trust.

Whenever the Company shall have one (1) or more Paying Agents, it will, on or prior to each due date of the principal of, or interest on any Securities, deposit with a Paying Agent a sum sufficient to pay the principal or interest so becoming due, such sum to be held in trust for the benefit of the Persons entitled to such principal or interest, and (unless such Paying Agent is the Trustee) the Company will promptly notify the Trustee of its failure so to act.

The Company will cause each Paying Agent other than the Trustee to execute and deliver to the Trustee an instrument in which such Paying Agent shall agree with the Trustee, subject to the provisions of this Section, that such Paying Agent will:

(1) hold all sums held by it for the payment of the principal of or interest on Securities in trust for the benefit of the Persons entitled thereto until such sums shall be paid to such Persons or otherwise disposed of as herein provided;

(2) give the Trustee notice of any default by the Company (or any other obligor upon the Securities) in the making of any payment of principal or interest on the Securities; and

 

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(3) at any time during the continuance of any such default, upon the written request of the Trustee, forthwith pay to the Trustee all sums so held in trust by such Paying Agent.

The Company may at any time, for the purpose of obtaining the satisfaction and discharge of this Indenture or for any other purpose, pay, or by Company Order direct any Paying Agent to pay, to the Trustee all sums held in trust by the Company or such Paying Agent, such sums to be held by the Trustee upon the same trusts as those upon which such sums were held by the Company or such Paying Agent; and, upon such payment by any Paying Agent to the Trustee, such Paying Agent shall be released from all further liability with respect to such money.

Any money deposited with the Trustee or any Paying Agent, or then held by the Company, in trust for the payment of the principal of or interest on any Security and remaining unclaimed for one (1) year after such principal or interest has become due and payable shall be paid to the Company on request of the Company; and the Holder of such Security shall thereafter, as an unsecured general creditor, look only to the Company for payment thereof, and all liability of the Trustee or such Paying Agent with respect to such trust money, and all liability of the Company as trustee thereof, shall thereupon cease; provided, however, that the Trustee or such Paying Agent, before being required to make any such repayment, may at the expense of the Company cause to be published once, in a newspaper published in the English language, customarily published on each New York Business Day and of general circulation in the Borough of Manhattan, The City of New York, New York, notice that such money remains unclaimed and that, after a date specified therein, which shall not be less than thirty (30)  days from the date of such publication, any unclaimed balance of such money then remaining will be repaid to the Company.

Section 1004. Certificate of Officers of the Company.

On or before one hundred twenty (120) days after the end of each fiscal year beginning with the fiscal year ending December 31, 2017, the Company will file with the Trustee an Officers’ Certificate stating, as to each signer, whether or not the signer has obtained knowledge of any action or failure to act on the part of the Company during the preceding fiscal year in violation of any covenant, agreement, provision or condition contained in this Indenture and, if so, specifying each such default of which the signer may have knowledge and the nature thereof. For purposes of this Section 1004, compliance shall be determined without regard to any period of grace or requirement of notice provided pursuant to the terms of this Indenture. At least one (1) of the Persons signing such Officers’ Certificate shall be the Company’s principal executive officer, principal financial officer or principal accounting officer.

 

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IN WITNESS WHEREOF, the parties hereto have caused this Indenture to be duly executed as of the day and year first above written.

 

DOMINION ENERGY, INC.
By  

/s/ James R. Chapman

  James R. Chapman
  Senior Vice President – Mergers & Acquisitions and Treasurer

DEUTSCHE BANK TRUST COMPANY AMERICAS

By: Deutsche Bank National Trust Company

By  

/s/ Robert S. Peschler

  Robert S. Peschler
  Vice President
By  

/s/ Annie Jaghatspanyan

  Annie Jaghatspanyan
  Vice President

[Indenture Signature Page]

EX-5.1

EXHIBIT 5.1

 

McGuireWoods LLP  

Gateway Plaza  

800 East Canal Street  

Richmond, VA 23219  

Phone: 804.775.1000  

Fax: 804.775.1061  

www.mcguirewoods.com  

   
  LOGO  

November 2, 2017

Board of Directors

Dominion Energy, Inc.

120 Tredegar Street

Richmond, Virginia 23219

Dominion Energy, Inc.

Registration Statement on Form S-3

Ladies and Gentlemen:

We have acted as special counsel to Dominion Energy, Inc., a Virginia corporation (the “Company”), in connection with the Registration Statement on Form S-3 (the “Registration Statement”) being filed by the Company on or about the date of this opinion letter with the Securities and Exchange Commission (the “SEC”) in connection with the registration under the Securities Act of 1933, as amended (the “Securities Act”), of certain Variable Denomination Floating Rate Demand Notes (the “Debt Securities”) to be issued pursuant to the Dominion Energy Reliability Investment Plan (the “Plan”). This opinion letter is being furnished in accordance with the requirements of Item 16 of Form S-3 and Item 601(b)(5)(i) of Regulation S-K promulgated under the Securities Act.

The Debt Securities are described in the Registration Statement. We understand that the Debt Securities will be issued pursuant to that certain Indenture dated as of November 1, 2017, between the Company and Deutsche Bank Trust Company Americas, as trustee (the “Indenture”). Capitalized terms used herein, but not defined herein, shall have the meanings assigned thereto in the Indenture.

Documents Reviewed

In connection with this opinion letter, we have examined the following documents:

(a)    the Registration Statement, including the exhibits being filed therewith and incorporated by reference therein from previous filings made by the Company with the SEC (which exhibits include the Indenture and the Plan); and

(b)    the prospectus contained in the Registration Statement (the “Prospectus”).

In addition we have examined and relied upon the following:

(i)    a certificate from the Assistant Corporate Secretary of the Company certifying as to (A) true and correct copies of the articles of incorporation and bylaws of the Company (the “Organizational Documents”) and (B) the resolutions of the Board of Directors of the Company authorizing the filing of the Registration Statement and the issuance of the Debt Securities by the Company;


(ii)    a certificate dated November 2, 2017 issued by the State Corporation Commission of the Commonwealth of Virginia, attesting to the corporate status and good standing of the Company in the Commonwealth of Virginia; and

(iii)    originals, or copies identified to our satisfaction as being true copies, of such other records, documents and instruments as we have deemed necessary for the purposes of this opinion letter.

Applicable Law” means the law of the Commonwealth of Virginia and the State of New York.

Assumptions Underlying Our Opinions

For all purposes of the opinions expressed herein, we have assumed, without independent investigation, the following:

(a)    Factual Matters. To the extent that we have reviewed and relied upon (i) certificates of the Company or authorized representatives thereof, (ii) representations of the Company set forth in the Indenture (if any) and (iii) certificates and assurances from public officials, all of such certificates and assurances are accurate with regard to factual matters and all official records (including filings with public authorities) are properly indexed and filed and are accurate and complete.

(b)    Signatures. The signatures of individuals who have signed or will sign the Indenture are genuine and (other than those of individuals signing on behalf of the Company at or before the date hereof) authorized.

(c)    Authentic and Conforming Documents. All documents submitted to us as originals are authentic, complete and accurate, and all documents submitted to us as copies conform to authentic original documents.

(d)    Organizational Status, Power and Authority and Legal Capacity of Certain Parties. All parties to the Indenture are or will be, as of the date the Indenture is executed and delivered, validly existing and in good standing in their respective jurisdictions of formation, except that no such assumption is made as to the Company as of the date hereof. All parties to the Indenture have or will have, as of the date the Indenture is executed and delivered, the capacity and full power and authority to execute, deliver and perform the Indenture and the documents required or permitted to be delivered and performed thereunder, except that no such assumption is made as to the Company as of the date hereof. All individuals who have signed or will sign the Indenture had or will have, as of the date the Indenture is executed and delivered, the legal capacity to execute such Indenture.

(e)    Authorization, Execution and Delivery of Indenture. The Indenture and the documents required or permitted to be delivered thereunder have been or will be, as of the date the Indenture is executed and delivered, duly authorized by all necessary corporate, limited liability company, business trust, partnership or other action on the part of the parties thereto and have been or will be, as of the date the Indenture is executed and delivered, duly executed and delivered by such parties, except that no such assumption is made as to the Company as to the Indenture as of the date hereof.

(f)    Indenture Binding on Certain Parties. The Indenture and the documents required or permitted to be delivered thereunder are or will be, as of the date the Indenture and such other documents are executed and delivered, valid and binding obligations enforceable against the parties thereto in accordance with their terms, except that no such assumption is made as to the Company.

 

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(g)    Noncontravention. Neither the issuance of the Debt Securities by the Company or the execution and delivery of the Indenture by any party thereto nor the performance by such party of its obligations thereunder will conflict with or result in a breach of (i) the certificate or articles of incorporation, bylaws, certificate or articles of organization, operating agreement, certificate of limited partnership, partnership agreement, trust agreement or other similar organizational documents of any such party, except that no such assumption is made as to the Company as to its Organizational Documents as of the date hereof, (ii) any law or regulation of any jurisdiction applicable to any such party, except that no such assumption is made as to the Company as to any Applicable Law as of the date hereof, or (iii) any order, writ, injunction or decree of any court or governmental instrumentality or agency applicable to any such party or any agreement or instrument to which any such party may be a party or by which its properties are subject or bound, except that no such assumption is made as to the Company as to the Indenture as of the date hereof.

(h)    Governmental Approvals. All consents, approvals and authorizations of, or filings with, all governmental authorities that are required as a condition to the issuance of the Debt Securities or to the execution and delivery of the Indenture by the parties thereto or the performance by such parties of their obligations thereunder will have been obtained or made, except that no such assumption is made with respect to any consent, approval, authorization or filing that is applicable to the Company as of the date hereof.

(i)    Registration; Trust Indenture Act. The Registration Statement shall have become effective under the Securities Act and such effectiveness shall not have been terminated or rescinded and the Indenture will be qualified under the Trust Indenture Act of 1939.

(j)    No Mutual Mistake, Amendments etc. There has not been, and will not be, as of the date the Indenture is executed and delivered, any mutual mistake of fact, fraud, duress or undue influence in connection with the issuance of the Debt Securities as contemplated by the Registration Statement, Prospectus and any supplements to the Prospectus. There are and will be no oral or written statements or agreements that modify, amend or vary, or purport to modify, amend or vary, any of the terms of the Indenture.

Our Opinions

Based on and subject to the foregoing and the exclusions, qualifications, limitations and other assumptions set forth in this opinion letter, we are of the opinion that:

1.    Organizational Status. The Company is a validly existing corporation under the laws of the Commonwealth of Virginia.

2.    Power and Authority. The Company has the corporate power and authority to issue the Debt Securities.

3.    Debt Securities. With respect to any Debt Securities, when (i) such Debt Securities have been issued and sold as contemplated by the Registration Statement, the Prospectus and any applicable supplement to such Prospectus, (ii) the Company has received the consideration provided for in the

 

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Prospectus; and (iii) an individual record or entries in the name of the particular Holder has been established for such Debt Securities on the Security Register as provided for in the Indenture, such Debt Securities will constitute the valid and binding obligations of the Company, enforceable against the Company in accordance with their terms, under the laws of the State of New York.

Matters Excluded from Our Opinions

We express no opinion with respect to the following matters:

(a)    Indemnification and Change of Control. The enforceability of any agreement of the Company as may be included in the terms of the Debt Securities or in the Indenture relating to (i) indemnification, contribution or exculpation from costs, expenses or other liabilities or (ii) changes in the organizational control or ownership of the Company, which agreement (in the case of clause (i) or clause (ii)) is contrary to public policy or applicable law.

(b)    Jurisdiction, Venue, etc. The enforceability of any agreement of the Company in the Indenture to submit to the jurisdiction of any specific federal or state court (other than the enforceability in a court of the State of New York of any such agreement to submit to the jurisdiction of a court of the State of New York), to waive any objection to the laying of the venue, to waive the defense of forum non conveniens in any action or proceeding referred to therein, to waive trial by jury, to effect service of process in any particular manner or to establish evidentiary standards, and any agreement of the Company regarding the choice of law governing the Indenture (other than the enforceability in a court of the State of New York or in a federal court sitting in the State of New York and applying New York law to any such agreement that the laws of the State of New York shall govern).

(c)    Certain Laws. The following state laws, and regulations promulgated thereunder, and the effect of such laws and regulations, on the opinions expressed herein: securities (including Blue Sky laws).

(d)    Remedies. The enforceability of any provision in the Indenture to the effect that rights or remedies are not exclusive, that every right or remedy is cumulative and may be exercised in addition to any other right or remedy, that the election of some particular remedy does not preclude recourse to one or more others or that failure to exercise or delay in exercising rights or remedies will not operate as a waiver of any such right or remedy.

Qualifications and Limitations Applicable to Our Opinions

The opinions set forth above are subject to the following qualifications and limitations:

(a)    Applicable Law. Our opinions are limited to the Applicable Law, and we do not express any opinion concerning any other law.

(b)    Bankruptcy. Our opinions are subject to the effect of any applicable bankruptcy, insolvency (including, without limitation, laws relating to preferences, fraudulent transfers and equitable subordination), reorganization, moratorium and other similar laws affecting creditors’ rights generally.

(c)    Equitable Principles. Our opinions are subject to the effect of general principles of equity (regardless of whether considered in a proceeding in equity or at law), including, without limitation, concepts of materiality, reasonableness, good faith and fair dealing. In applying such

 

4


principles, a court, among other things, might limit the availability of specific equitable remedies (such as injunctive relief and the remedy of specific performance), might not allow a creditor to accelerate maturity of debt or exercise other remedies upon the occurrence of a default deemed immaterial or for non-credit reasons or might decline to order a debtor to perform covenants in an Indenture.

(d)    Unenforceability of Certain Provisions. Provisions contained in the Debt Securities or the Indenture which require waivers or amendments to be made only in writing may be unenforceable or ineffective, in whole or in part. The inclusion of such provisions, however, does not render any Subject Document invalid as a whole.

(e)    Choice of New York Law and Forum. To the extent that our opinions relate to the enforceability of the choice of New York law or any choice of New York forum provisions of the Indenture, our opinion is rendered in reliance upon N.Y. Gen. Oblig. Law §§ 5-1401 and 5-1402 and N.Y. CPLR 327(b) and is subject to the qualification that such enforceability may be limited by principles of public policy, comity and constitutionality. We express no opinion as to whether a United States federal court would have subject-matter or personal jurisdiction over a controversy arising under the Indenture.

Miscellaneous

The foregoing opinions are being furnished only for the purpose referred to in the first paragraph of this opinion letter. Our opinions are based on statutes, regulations and administrative and judicial interpretations which are subject to change. We undertake no responsibility to update or supplement these opinions subsequent to the effective date of the Registration Statement. Headings in this opinion letter are intended for convenience of reference only and shall not affect its interpretation. We hereby consent to the filing of this opinion as Exhibit 5.1 to the Registration Statement on or about the date hereof, to the incorporation by reference of this opinion of counsel into the Registration Statement and to the reference to our firm in the Prospectus under the caption “Legal Matters.” In giving this consent, we do not admit that we are within the category of persons whose consent is required by Section 7 of the Securities Act or the rules and regulations of the SEC promulgated thereunder.

 

Very truly yours,
/s/ McGuireWoods LLP

 

5

EX-23.2

Exhibit 23.2

CONSENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

We consent to the incorporation by reference in this Registration Statement on Form S-3 of our reports dated February 28, 2017, relating to the consolidated financial statements of Dominion Energy, Inc. and subsidiaries, and the effectiveness of Dominion Energy, Inc. and subsidiaries’ internal control over financial reporting, appearing in the Annual Report on Form 10-K of Dominion Energy, Inc. and subsidiaries for the year ended December 31, 2016, and to the reference to us under the heading “Experts” in the Prospectus, which is part of this Registration Statement.

/s/ Deloitte & Touche LLP

Richmond, Virginia

November 2, 2017

EX-25.1

EXHIBIT 25.1

 

 

 

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

 

 

FORM T-1

 

 

STATEMENT OF ELIGIBILITY

UNDER THE TRUST INDENTURE ACT OF 1939

OF A CORPORATION DESIGNATED TO ACT AS TRUSTEE

 

CHECK IF AN APPLICATION TO DETERMINE ELIGIBILITY OF A TRUSTEE PURSUANT TO SECTION 305(b)(2)

 

 

DEUTSCHE BANK TRUST COMPANY AMERICAS

(formerly BANKERS TRUST COMPANY)

(Exact name of trustee as specified in its charter)

 

 

 

NEW YORK   13-4941247

(Jurisdiction of Incorporation or

organization if not a U.S. national bank)

 

(I.R.S. Employer

Identification no.)

60 WALL STREET

NEW YORK, NEW YORK

  10005
(Address of principal executive offices)   (Zip Code)

Deutsche Bank Trust Company Americas

Attention: Catherine Wang

Legal Department

60 Wall Street, 36th Floor

New York, New York 10005

(212) 250 – 7544

(Name, address and telephone number of agent for service)

 

 

Dominion Energy, Inc.

(Exact name of obligor as specified in its charter)

 

 

 

Virginia   54-1229715
(State or other jurisdiction of   (I.R.S. Employer
incorporation or organization)   Identification No.)

120 Tredegar Street

Richmond, Virginia

  23219
(Address of principal executive offices)   (Zip code)

 

 

Variable Denomination Floating Rate Demand Notes

(Title of the Indenture securities)

 

 

 


Item 1. General Information.

Furnish the following information as to the trustee.

 

  (a) Name and address of each examining or supervising authority to which it is subject.

 

Name

 

Address

Federal Reserve Bank (2nd District)   New York, NY
Federal Deposit Insurance Corporation   Washington, D.C.
New York State Banking Department   Albany, NY

 

  (b) Whether it is authorized to exercise corporate trust powers.

                  Yes.

 

Item 2. Affiliations with Obligor.

If the obligor is an affiliate of the Trustee, describe each such affiliation.

None.

 

Item 3. - 15. Not Applicable

 

Item 16. List of Exhibits.

 

Exhibit 1 -    Restated Organization Certificate of Bankers Trust Company dated August 31, 1998; Certificate of Amendment of the Organization Certificate of Bankers Trust Company dated September 25, 1998; Certificate of Amendment of the Organization Certificate of Bankers Trust Company dated December 18, 1998; Certificate of Amendment of the Organization Certificate of Bankers Trust Company dated September 3, 1999; and Certificate of Amendment of the Organization Certificate of Bankers Trust Company dated March 14, 2002, incorporated herein by reference to Exhibit 1 filed with Form T-1 Statement, Registration No. 333-201810.
Exhibit 2 -    Certificate of Authority to commence business, incorporated herein by reference to Exhibit 2 filed with Form T-1 Statement, Registration No. 333-201810.
Exhibit 3 -    Authorization of the Trustee to exercise corporate trust powers, incorporated herein by reference to Exhibit 3 filed with Form T-1 Statement, Registration No. 333-201810.
Exhibit 4 -    Existing By-Laws of Deutsche Bank Trust Company Americas, dated July 24, 2014, incorporated herein by reference to Exhibit 4 filed with Form T-1 Statement, Registration No. 333-201810.
Exhibit 5 -    Not applicable.
Exhibit 6 -    Consent of Bankers Trust Company required by Section 321(b) of the Act, incorporated herein by reference to Exhibit 6 filed with Form T-1 Statement, Registration No. 333-201810.
Exhibit 7 -    A copy of the latest report of condition of the trustee published pursuant to law or the requirements of its supervising or examining authority.
Exhibit 8 -    Not Applicable.
Exhibit 9 -    Not Applicable.


SIGNATURE

Pursuant to the requirements of the Trust Indenture Act of 1939, as amended, the trustee, Deutsche Bank Trust Company Americas, a corporation organized and existing under the laws of the State of New York, has duly caused this statement of eligibility to be signed on its behalf by the undersigned, thereunto duly authorized, all in The City of New York, and State of New York, on this 1st day of November, 2017.

 

DEUTSCHE BANK TRUST COMPANY AMERICAS
                By:  

/s/ Carol Ng                                                    

        Name: Carol Ng
        Title:   Vice President


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Board of Governors of the Federal Reserve System OMB Number 7100-0036 Federal Deposit Insurance Corporation OMB Number 3064-0052 Office of the Comptroller of the Currency OMB Number 1557-0081 Approval expires March 31, 2020 Page 1 of 85 Federal Financial Institutions Examination Council Consolidated Reports of Condition and Income for a Bank with Domestic Offices Only—FFIEC 041 Report at the close of business September 30, 2017 20170930 (RCON 9999) This report is required by law: 12 U.S.C. § 324 (State member Unless the context indicates otherwise, the term “bank” in this banks); 12 U.S.C. §1817 (State nonmember banks); 12 U.S.C. §161 report form refers to both banks and savings associations. (National banks); and 12 U.S.C. §1464 (Savings associations). This report form is to be filed by banks with domestic offices only except those banks that file the FFIEC 051. Banks with foreign offices (as defined in the instructions) must file FFIEC 031. NOTE: Each bank’s board of directors and senior management are schedules) for this report date have been prepared in confor- responsible for establishing and maintaining an effective system of mance with the instructions issued by the appropriate Federal internal control, including controls over the Reports of Condition and regulatory authority and are true and correct to the best of my Income. The Reports of Condition and Income are to be prepared in knowledge and belief. accordance with federal regulatory authority instructions. The Reports of Condition and Income must be signed by the Chief Financial We, the undersigned directors (trustees), attest to the correctness Officer (CFO) of the reporting bank (or by the individual performing an of the Reports of Condition and Income (including the supporting equivalent function) and attested to by not less than two directors schedules) for this report date and declare that the Reports of (trustees) for state nonmember banks and three directors for state Condition and Income have been examined by us and to the best member banks, national banks, and savings associations. of our knowledge and belief have been prepared in conformance with the instructions issued by the appropriate Federal regulatory I, the undersigned CFO (or equivalent) of the named bank, attest authority and are true and correct. that the Reports of Condition and Income (including the supporting Director (Trustee) Signature of Chief Financial Officer (or Equivalent) Director (Trustee) 10/27/2017 Date of Signature Director (Trustee) Submission of Reports Each bank must file its Reports of Condition and Income (Call To fulfill the signature and attestation requirement for the Reports Report) data by either: of Condition and Income for this report date, attach your bank’s completed signature page (or a photocopy or a computer gener- (a) Using computer software to prepare its Call Report and then ated version of this page) to the hard-copy record of the data file submitting the report data directly to the FFIEC’s Central Data submitted to the CDR that your bank must place in its files. Repository (CDR), an Internet-based system for data collec- tion (https://cdr.ffiec.gov/cdr/), or The appearance of your bank’s hard-copy record of the submitted (b) Completing its Call Report in paper form and arranging with a data file need not match exactly the appearance of the FFIEC’s software vendor or another party to convert the data into the sample report forms, but should show at least the caption of each electronic format that can be processed by the CDR. The Call Report item and the reported amount. software vendor or other party then must electronically submit the bank’s data file to the CDR. DEUTSCHE BANK TRUST COMPANY AMERICAS Legal Title of Bank (RSSD 9017) For technical assistance with submissions to the CDR, please contact the CDR Help Desk by telephone at (888) CDR-3111, by New York fax at (703) 774-3946, or by e-mail at CDR.Help@ffiec.gov. City (RSSD 9130) FDIC Certificate Number 623 NY 10005 (RSSD 9050) State Abbreviation (RSSD 9200) Zip Code (RSSD 9220) Legal Entity Identifier (LEI) 8EWQ2UQKS07AKK8ANH81 (Report only if your institution already has an LEI.) (RCON 9224) The estimated average burden associated with this information collection is 74.9 hours per respondent and is expected to vary by institution, depending on individual circumstances. Burden estimates include the time for reviewing instructions, gathering and maintaining data in the required form, and completing the information collection, but exclude the time for compiling and maintaining business records in the normal course of a respondent’s activities. A Federal agency may not conduct or sponsor, and an organization (or a person) is not required to respond to a collection of information, unless it displays a currently valid OMB control number. Comments concerning the accuracy of this burden estimate and suggestions for reducing this burden should be directed to the Office of Information and Regulatory Affairs, Office of Management and Budget, Washington, DC 20503, and to one of the following: Secretary, Board of Governors of the Federal Reserve System, 20th and C Streets, NW, Washington, DC 20551; Legislative and Regulatory Analysis Division, Office of the Comptroller of the Currency, Washington, DC 20219; Assistant Executive Secretary, Federal Deposit Insurance Corporation, Washington, DC 20429. 09/2017


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FFIEC 041 Page 15 of 85 RC-1 Consolidated Report of Condition for Insured Banks and Savings Associations for September 30, 2017 All schedules are to be reported in thousands of dollars. Unless otherwise indicated, report the amount outstanding as of the last business day of the quarter. Schedule RC—Balance Sheet    Dollar Amounts in Thousands RCON Amount Assets 1. Cash and balances due from depository institutions (from Schedule RC-A):    a. Noninterest-bearing balances and currency and coin (1) . . 0081 34,000 1.a. b. Interest-bearing balances (2) 0071 20,482,000 1.b. 2. Securities:    a. Held-to-maturity securities (from Schedule RC-B, column A) 1754 0 2.a. b. Available-for-sale securities (from Schedule RC-B, column D) . 1773 0 2.b. 3. Federal funds sold and securities purchased under agreements to resell:    a. Federal funds sold B987 0 3.a. b. Securities purchased under agreements to resell (3) B989 12,000,000 3.b. 4. Loans and lease financing receivables (from Schedule RC-C):    a. Loans and leases held for sale .. 5369 0 4.a. b. Loans and leases held for investment B528 9,746,000 4.b. c. LESS: Allowance for loan and lease losses 3123 18,000 4.c. d. Loans and leases held for investment, net of allowance (item 4.b minus 4.c) B529 9,728,000 4.d. 5. Trading assets (from Schedule RC-D) . 3545 0 5. 6. Premises and fixed assets (including capitalized leases) 2145 13,000 6. 7. Other real estate owned (from Schedule RC-M) 2150 0 7. 8. Investments in unconsolidated subsidiaries and associated companies 2130 0 8. 9. Direct and indirect investments in real estate ventures 3656 0 9. 10. Intangible assets:    a. Goodwill . 3163 0 10.a. b. Other intangible assets (from Schedule RC-M) 0426 25,000 10.b. 11. Other assets (from Schedule RC-F) 2160 1,043,000 11. 12. Total assets (sum of items 1 through 11) 2170 43,325,000 12. Liabilities 13. Deposits:    a. In domestic offices (sum of totals of columns A and C from Schedule RC-E) 2200 32,086,000 13.a. (1) Noninterest-bearing (4) .. 6631 27,130,000 13.a.(1) (2) Interest-bearing .. 6636 4,956,000 13.a.(2) b. Not applicable 14. Federal funds purchased and securities sold under agreements to repurchase:    a. Federal funds purchased (5) .. B993 774,000 14.a. b. Securities sold under agreements to repurchase (6) B995 0 14.b. 15. Trading liabilities (from Schedule RC-D) .. 3548 0 15. 16. Other borrowed money (includes mortgage indebtedness and obligations under    capitalized leases) (from Schedule RC-M) .. 3190 165,000 16. 17. and 18. Not applicable 19. Subordinated notes and debentures (7) .. 3200 0 19. 20. Other liabilities (from Schedule RC-G) . 2930 1,337,000 20. 21. Total liabilities (sum of items 13 through 20) 2948 34,362,000 21. 22. Not applicable 1. Includes cash items in process of collection and unposted debits. 2. Includes time certificates of deposit not held for trading. 3. Includes all securities resale agreements, regardless of maturity. 4. Includes noninterest-bearing demand, time, and savings deposits. 5. Report overnight Federal Home Loan Bank advances in Schedule RC, item 16, “Other borrowed money.” 6. Includes all securities repurchase agreements, regardless of maturity. 7. Includes limited-life preferred stock and related surplus.    09/2017


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FFIEC 041 Page 16 of 85 RC-2 Schedule RC—Continued    Dollar Amounts in Thousands RCON Amount Equity Capital    Bank Equity Capital 23. Perpetual preferred stock and related surplus 3838 0 23. 24. Common stock . 3230 2,127,000 24. 25. Surplus (exclude all surplus related to preferred stock) .. 3839 610,000 25. 26. a. Retained earnings .. 3632 6,227,000 26.a. b. Accumulated other comprehensive income (1) . B530 (1,000) 26.b. c. Other equity capital components (2) A130 0 26.c. 27. a. Total bank equity capital (sum of items 23 through 26.c) .. 3210 8,963,000 27.a. b. Noncontrolling (minority) interests in consolidated subsidiaries . 3000 0 27.b. 28. Total equity capital (sum of items 27.a and 27.b) .. G105 8,963,000 28. 29. Total liabilities and equity capital (sum of items 21 and 28) .. 3300 43,325,000 29. Memoranda To be reported with the March Report of Condition. 1. Indicate in the box at the right the number of the statement below that best describes the most    comprehensive level of auditing work performed for the bank by independent external auditors as of RCON Number    any date during 2016 6724 NA M.1. 1a = An integrated audit of the reporting institution’s financial 2b = An audit of the reporting institution’s parent holding    statements and its internal control over financial reporting company’s consolidated financial statements only conducted    conducted in accordance with the standards of the in accordance with the auditing standards of the AICPA or    American Institute of Certified Public Accountants (AICPA) the PCAOB by an independent public accountant that    or Public Company Accounting Oversight Board (PCAOB) submits a report on the consolidated holding company (but    by an independent public accountant that submits a report not on the institution separately)    on the institution 3 = This number is not to be used 1b = An audit of the reporting institution’s financial statements 4 = Directors’ examination of the bank conducted in accordance    only conducted in accordance with the auditing standards with generally accepted auditing standards by a certified public    of the AICPA or the PCAOB by an independent public accounting firm (may be required by state-chartering authority)    accountant that submits a report on the institution 5 = Directors’ examination of the bank performed by other external 2a = An integrated audit of the reporting institution’s parent auditors (may be required by state-chartering authority)    holding company’s consolidated financial statements and 6 = Review of the bank’s financial statements by external auditors    its internal control over financial reporting conducted in 7 = Compilation of the bank’s financial statements by external    accordance with the standards of the AICPA or the PCAOB auditors    by an independent public accountant that submits a report 8 = Other audit procedures (excluding tax preparation work)    on the consolidated holding company (but not on the 9 = No external audit work    institution separately) To be reported with the March Report of Condition. RCON Date 2. Bank’s fiscal year-end date (report the date in MMDD format) 8678 NA M.2. 1. Includes, but is not limited to, net unrealized holding gains (losses) on available-for-sale securities, accumulated net gains (losses) on cash flow hedges, and accumulated defined benefit pension and other postretirement plan adjustments. 2. Includes treasury stock and unearned Employee Stock Ownership Plan shares.    03/2017