SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report (date of earliest event reported): February 22, 1996
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NORTHWEST NATURAL GAS COMPANY
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(Exact name or registrant as specified in its charter)
Oregon 0-994 93-0256722
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(State or other jurisdiction of (Commission (IRS Employer
incorporation or organization) File Number) Identification No.)
220 N.W. Second Avenue, Portland, Oregon 97209
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(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (503) 226-4211
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N/A
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(Former name or former address, if changed since last report.)
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ITEM 5. OTHER EVENTS.
On February 22, 1996, the Board of Directors of Northwest
Natural Gas Company (the "Company") declared a dividend of one common
share purchase right (a "Right") for each outstanding share of common
stock, par value $3-1/6 per share, of the Company (a "Common Share").
The dividend is payable to the shareholders of record as of the close of
business on March 15, 1996 (the "Record Date"). Each Right entitles the
registered holder to purchase from the Company at any time following the
Distribution Date (as defined below) one-tenth of a Common Share at an
initial purchase price of $10.00, subject to adjustment (the "Purchase
Price"). The description and terms of the Rights are set forth in the
Rights Agreement, dated as of February 27, 1996 (the "Rights
Agreement"), by and between the Company and Boatmen's Trust Company as
rights agent.
Initially, the Rights will be evidenced, with respect to any
of the Common Share certificates outstanding as of the Record Date, by
such Common Share certificate. The Rights will separate from the Common
Shares upon the Distribution Date which shall be the earlier to occur of
(i) the close of business on the tenth day following a public
announcement that a person or group of affiliated or associated persons
(collectively, a "Person") have acquired beneficial ownership of 15% or
more of the outstanding Common Shares (such Person being hereinafter
referred to as an "Acquiring Person") or (ii) the close of business on
the tenth business day (or such later date as may be determined by
action of the Board of Directors of the Company prior to such time as
any Person becomes an Acquiring Person) following the commencement of,
or the first public announcement of an intention of any Person to
commence, a tender offer or exchange offer the consummation of which
would result in such Person becoming an Acquiring Person, provided that
such Person is not the Company or any subsidiary of the Company, any
employee benefit plan of the Company or of any subsidiary of the Company
or any entity holding Common Shares for or pursuant to the terms of any
such plan.
Until the Distribution Date, (i) the Rights will be evidenced
by the certificates for Common Shares and will be transferred with and
only with such Common Share certificates, (ii) new certificates for
Common Shares issued after the Record Date will contain a notation
incorporating the Rights Agreement by reference, and (iii) the surrender
for transfer of any such certificate for Common Shares outstanding on
the Record Date, with or without a copy of the Summary of Rights being
attached thereto, will also constitute the transfer of the Rights
associated with the Common Shares represented thereby. As soon as
practical following the Distribution Date, separate certificates
evidencing the Rights ("Right Certificates") will be mailed to holders
of record of the Common Shares as of the close of business on the
Distribution Date and such separate Right Certificates alone will
evidence the Rights. Subject to certain exceptions, only Common Shares
issued prior to the Distribution Date will be issued with Rights.
The Rights are not exercisable until the Distribution Date and
will expire on the earlier of (i) the close of business on March 15,
2006, (ii) the time at which the Rights are redeemed by the Company or
(iii) if a Person has become an Acquiring Person, the time at which the
Rights (other than Rights which are void as described below) are
exchanged for Common Shares at an exchange ratio of one Common Share per
Right, as adjusted by the Company (provided, however, such exchange may
not take effect at any time after any Person becomes a beneficial owner
of 50% or more of the Common Shares then outstanding).
The Purchase Price payable and the number of Common Shares
issuable upon exercise of the Rights are subject to adjustment from time
to time to prevent dilution in the event of (i) a stock dividend on, or
a subdivision, combination or reclassification of, the Common Shares,
(ii) the issuance of rights, options or warrants to subscribe for or
purchase Common Shares at a price, or securities convertible into Common
Shares at a conversion price, less than the then current market price
for the Common Shares, or (iii) a distribution to all holders of the
Common Shares of evidences of indebtedness or assets (excluding regular
quarterly cash dividends or dividends payable in Common Shares) or
subscription rights or warrants (other than those referred to above).
With certain exceptions, no adjustment in the Purchase Price
will be required unless such adjustment would require an increase or
decrease of at least 1% in the Purchase Price. No fractional Rights
will be issued and, in lieu thereof, holders of the Rights with regard
to which such fractional Rights would otherwise be issuable will be paid
an amount in cash equal to the same fraction of the current market value
of a whole Right.
In the event, directly or indirectly, (i) the Company
consolidates with, or merges with and into, any other person, (ii) any
person consolidates with the Company, or merges with and into the
Company and the Company is the continuing or surviving corporation of
such merger and, in connection therewith, all or part of the Common
Shares is changed into or exchanged for stock or other securities of any
person (including the Company) or cash or any other property, or (iii)
the Company sells or otherwise transfers in one or more transactions,
assets or earning power aggregating 50% or more of the assets or earning
power of the Company and its subsidiaries, taken as a whole, to any
other person, proper provision will be made so that each holder of a
Right, except Rights which previously have been voided as indicated
below, will thereafter have the right to receive, upon exercise thereof
for a purchase price equal to ten times the current Purchase Price of
the Right, that number of shares of common stock of the other person
which at the time of such transaction will have a market value equal to
twenty times the Purchase Price of the Right.
In the event that any Person becomes an Acquiring Person,
proper provision shall be made so that each holder of a Right, other
than Rights beneficially owned by the Acquiring Person (which will
thereafter be void), will thereafter have the right to receive, upon
exercise, for a purchase price equal to ten times the Purchase Price of
the Right, that number of Common Shares having a market value equal to
twenty times the Purchase Price of the Right.
Any Rights acquired or beneficially owned by any Acquiring
Person or certain related parties thereto will be void, and any holder
of such Rights will thereafter have no right to exercise such Rights
under any provision of the Rights Agreement.
At any time prior to such time that a Person becomes an
Acquiring Person, the Board of Directors of the Company may redeem the
then outstanding Rights in whole, but not in part, at a price of $.01
per Right, subject to adjustment (the "Redemption Price"). The
redemption of the rights may be made effective at such time on such
basis and with such conditions as the Board of Directors in its sole
discretion may establish. Immediately upon any redemption of the
Rights, the right to exercise the Rights will terminate and the only
right of the holders of the Rights will be to receive the Redemption
Price.
The terms of the Rights may be amended by the Board of
Directors of the Company without the consent of the holders of the
Rights. After the Distribution Date, no such amendment may adversely
affect the interests of the holders of the Rights.
Issuance of the Common Shares upon exercise of the Rights will
be subject to any necessary regulatory approvals. Until a Right shall
be exercised, the holder thereof, as such, will have no right as a
shareholder of the Company, including without limitation, the right to
vote or to receive dividends.
As of January 31, 1996, the Company had 14,832,825 Common
Shares outstanding and no Common Shares of the Company in the treasury.
Each Common Share of the Company outstanding at the close of business on
the Record Date will receive one Right. In addition, prior to the
Distribution Date, one Right (subject to adjustment) will be deemed to
be delivered for each Common Share issued or transferred by the Company
after the Record Date. Also, following the Distribution Date and prior
to the expiration or redemption of the Rights, the Company (i) will with
respect to Common Shares issued or sold pursuant to exercise, conversion
or exchange of certain securities of the Company, and (ii) may in any
other case, if deemed necessary or appropriate by the Board of Directors
of the Company, issue Rights in connection with such issuance or sale.
The Company has initially reserved for issuance upon exercise of the
Rights 2,000,000 Common Shares.
The Rights have certain anti-takeover effects. The Rights
will cause substantial dilution to a Person that attempts to acquire the
Company on terms not approved by the Company's Board of Directors. The
Rights should not interfere with any merger or other business
combination approved by the Board of Directors of the Company because
the Rights may be redeemed by the Company prior to the time that a
Person acquires beneficial ownership of 10% or more of the Common
Shares.
The Rights Agreement which specifies the terms of the Rights
and includes as Exhibit A thereto a form of the Right Certificate is
attached hereto as Exhibit 1 and is incorporated herein by reference.
The foregoing description of the Rights does not purport to be complete
and is qualified in its entirety by reference to such Exhibit.
ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS.
(c) Exhibits:
4 Rights Agreement, dated as of February 27, 1996, between
Northwest Natural Gas Company and Boatmen's Trust Company,
which includes as Exhibit A thereto the form of a Right
Certificate and Exhibit B thereto the Summary of Rights to
Purchase Common Shares (incorporated by reference to Exhibit 1
to the Registrant's Registration Statement on Form 8-A, dated
February 27, 1996).
99 Press Release.
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of
1934, the Registrant has caused this report to be signed on its behalf
by the undersigned thereunto duly authorized.
NORTHWEST NATURAL GAS COMPANY
Dated: February 27, 1996 By: /s/ Bruce R. DeBolt
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Name: Bruce R. DeBolt
Title: Senior Vice President
and Chief Financial Officer
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EXHIBIT INDEX
Exhibit Description Page
4 Rights Agreement, dated as of February 27,
1996, between Northwest Natural Gas Company
and Boatmen's Trust Company, which includes
as Exhibit A thereto the form of a Right
Certificate and Exhibit B thereto the
Summary of Rights to Purchase Common Shares
(incorporated by reference to Exhibit 1 to
the Registrant's Registration Statement on
Form 8-A, dated February 27, 1996).
99 Press Release.
EXHIBIT 99
February 27, 1996
FOR IMMEDIATE RELEASE
NWNG ADOPTS SHAREHOLDER RIGHTS PLAN
PORTLAND, Ore. -- Northwest Natural Gas Company (Nasdaq
National Market: NWNG) announced that its Board of Directors has
adopted a Shareholder Rights Plan.
"The Rights are designed to assure that all of the
Company's shareholders will receive fair and equal treatment in
the event of a proposed takeover of the Company on terms less
favorable than would be available in a transaction negotiated
with the Company's Board of Directors," Robert L. Ridgley,
president and chief executive officer, said Tuesday. "The new
Plan is similar to plans adopted by a large number of public
companies, including many electric and gas utilities, and
represents a prudent means of safeguarding the interests of all
shareholders should an effort be made to acquire the Company at a
price that does not reflect fair value."
"The Rights will not prevent a takeover," Ridgley
explained, "but they are designed to encourage anyone seeking to
acquire the Company to negotiate with the Board prior to
attempting a takeover."
Ridgley emphasized that the Rights Plan was not adopted
in response to any effort to acquire control of the Company, and
said the Company is not aware of any such effort.
In connection with the adoption of the Rights Plan, the
Company's Board declared a dividend of one Right for each
outstanding share of Common Stock. Each Right will entitle
shareholders to purchase one tenth of a share of Common Stock for
$10.00. In the event that any person acquires more than 15% of
the outstanding Common Stock, subject to the terms of the Rights
Plan, the Right becomes exercisable entitling each holder (other
than the acquiring person or group), for a purchase price equal
to ten times the current purchase price of the Right, to purchase
that number of shares of Common Stock having a market value equal
to twenty times the purchase price of the Right.
If the Company were acquired in a merger or other
business combination transaction after a person has acquired 15%
or more of the Company's outstanding Common Stock, each Right
would entitle its holder to purchase, for a price equal to ten
times the current purchase price of the Right, a number of the
acquiring company's common shares having a market value of twenty
times the current exercise price of the Right.
Rights will be distributed to shareholders of record on
March 15, 1996. No separate certificates will be issued. The
Rights will be evidenced by the existing stock certificates and
will expire on March 15, 2006. The distribution is not taxable
to shareholders. Details are contained in a letter to
shareholders that will be mailed to all shareholders of the
Company immediately after the record date.
Northwest Natural Gas Company serves about 410,000 gas
utility customers in Oregon and southwest Washington.
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