8-KMaterial AgreementsExhibits & Filings

DOMINION ENERGY, INC 8-K Report, Material Agreement (Oct 6, 2020)

Filed October 6, 2020For Securities:D

Summary

Dominion Energy announced a significant amendment to its previously disclosed sale of its Gas Transmission & Storage operating segment to Berkshire Hathaway Energy (BHE). Due to the failure to obtain antitrust approval (HSR) within the initial timeframe, the transaction has been bifurcated. The sale of substantially all assets, excluding the Questar Pipeline Group, is still expected to close on November 2, 2020, for approximately $2.7 billion in cash and the assumption of $5.3 billion in debt. However, the sale of the Questar Pipeline Group has been restructured into a separate "Q-Pipe Purchase Agreement," with an expected closing in early 2021, contingent on HSR approval. This separate transaction is valued at approximately $1.3 billion in cash and the assumption of $430 million in debt.

Key Highlights

  • 1The sale of Dominion Energy's Gas Transmission & Storage assets to BHE has been split into two separate transactions.
  • 2The primary transaction (excluding Questar Pipeline Group) is expected to close on November 2, 2020, for $2.7 billion cash and $5.3 billion debt assumption.
  • 3The Questar Pipeline Group sale is now a separate transaction (Q-Pipe Transaction) with an anticipated early 2021 closing, subject to HSR approval.
  • 4The Q-Pipe Transaction is valued at approximately $1.3 billion cash and $430 million debt assumption.
  • 5Dominion Energy will waive the termination fee related to the Questar Pipeline Group in conjunction with the new Q-Pipe Purchase Agreement.
  • 6BHE will deliver the Q-Pipe cash consideration ($1.3 billion) on November 2, 2020, with provisions for repayment if the Q-Pipe Transaction does not close.
  • 7The Q-Pipe Purchase Agreement includes protections for transferred employees and customary representations, warranties, and indemnification clauses.

Frequently Asked Questions

The original agreement required antitrust approval (HSR) within 75 days. Since this approval was not obtained for the entire package, Dominion Energy and BHE elected to terminate the sale of the Questar Pipeline Group under the original agreement and enter into a new, separate agreement for this specific asset group.

The Q-Pipe Purchase Agreement anticipates closing the sale of the Questar Pipeline Group in early 2021, pending receipt of HSR approval. Both parties have the option to terminate the agreement if the closing has not occurred by June 30, 2021.

BHE will provide $1.3 billion in cash for the Questar Pipeline Group on November 2, 2020. If the Q-Pipe Transaction does not close, Dominion Energy Questar has agreed to repay this amount by December 31, 2021. The repayment can be in cash or Dominion Energy stock, but must be cash if paid after December 15, 2021.

Yes, if the Q-Pipe Transaction does not close by June 30, 2021, and BHE requests it, Dominion Energy Questar will be obligated to seek alternative buyers for the Questar Pipeline Group. There are also provisions for repayment of the cash consideration if the transaction fails to close.