AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON NOVEMBER 1, 1996
Registration No. 333-_____
===========================================================================
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
----------------------
FORM S-3
REGISTRATION STATEMENT
Under
THE SECURITIES ACT OF 1933
----------------------
NORTHWEST NATURAL GAS COMPANY
(Exact name of registrant as specified in its charter)
OREGON 93-0256722
(State or other jurisdiction of (I.R.S. Employer Identification No.)
incorporation or organization)
One Pacific Square, 220 N.W. Second Avenue, Portland, Oregon 97209
503-226-4211
(Address, including zip code, and telephone number, including area code, of
registrant's principal executive offices)
----------------------
RICHARD G. REITEN
President
and Chief Operating Officer
One Pacific Square, 220 N.W. Second Avenue
Portland, Oregon 97209
503-226-4211
BRUCE R. DeBOLT JOHN T. HOOD, Esq.
Senior Vice President, Finance, Reid & Priest LLP
and Chief Financial Officer 40 West 57th Street
One Pacific Square, 220 N.W. Second Avenue New York, New York 10019
Portland, Oregon 97209 212-603-2000
503-226-4211
(Names, addresses, including zip codes, and telephone numbers, including
area codes, of agents for service)
----------------------
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, other than securities offered only in connection with dividend
or interest reinvestment plans, check the following box. [X]
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 delivery of the prospectus is expected to be made pursuant to Rule
434, please check the following box. [ ]
----------------------
CALCULATION OF REGISTRATION FEE
=======================================================================
Proposed Proposed
Title of each maximum maximum
class of offering aggregate
securities to Amount to be price per offering Registration
be registered registered unit price fee
------------------------------------------------------------------------
Debt Securities $150,000,000+ 100%* $150,000,000* $45,455+
========================================================================
* Inserted solely for the purpose of calculating the registration fee.
+ The combined Prospectus filed herewith pursuant to Rule 429 also relates
to an additional $15,000,000 of Debt Securities registered pursuant to
Registration No. 33-64014 which remains unsold and for which a
registration fee of $4,688 has been paid.
----------------------
The registrant hereby amends this registration statement on such date or
dates as may be necessary to delay its effective date until the registrant
shall file a further amendment which specifically states that this
registration statement shall thereafter become effective in accordance with
Section 8(a) of the Securities Act of 1933, as amended, or until the
registration statement shall become effective on such date as the Commis-
sion, acting pursuant to said Section 8(a), may determine.
===========================================================================
Pursuant to Rule 429, the combined Prospectus filed herewith also
relates to Registration No. 33-64014.
<PAGE>
PROSPECTUS
----------
$165,000,000
NORTHWEST NATURAL GAS COMPANY
SECURED MEDIUM-TERM NOTES, SERIES B
(SERIES OF FIRST MORTGAGE BONDS)
AND
UNSECURED MEDIUM-TERM NOTES, SERIES B
Due from Nine Months to 30 Years from Date of Issue
----------------------
Northwest Natural Gas Company ("Company") may offer from time to time up
to $165,000,000 aggregate principal amount of its debt securities ("Medium-
Term Notes"), consisting of its First Mortgage Bonds, designated Secured
Medium-Term Notes, Series B ("Secured Notes"), and its Unsecured Medium-
Term Notes, Series B ("Unsecured Notes"). The principal amounts, interest
rates, issue prices and agents' commissions, original issue and maturity
dates, redemption provisions, if any, and other material terms of the
Medium-Term Notes will be established by the Company from time to time and
will be set forth in supplements hereto ("Pricing Supplements"). The
Medium-Term Notes will have maturities from nine months to 30 years from
their respective dates of issue. Interest on each Medium-Term Note will
accrue from its date of issue and will be payable semi-annually in arrears
on each June 1 and December 1, and at maturity. The Medium-Term Notes will
not be subject to redemption prior to their stated maturity unless
otherwise specified in the applicable Pricing Supplement.
The Medium-Term Notes will be initially registered in the name of CEDE &
Co. as registered owner and nominee for The Depository Trust Company, New
York, New York ("DTC"). DTC will act as a securities depository for the
Medium-Term Notes of each issue. Sales of Medium-Term Notes will be made
only in book-entry form in denominations of $1,000 or any amount in excess
thereof that is an integral multiple of $1,000 and, except under the
limited circumstances described herein, beneficial owners of interests in
the Medium-Term Notes will not receive certificates representing their
interests in the Medium-Term Notes. Payments of principal, premium, if
any, and interest will be made through DTC and its Participants and
disbursements of such payments to purchasers will be the responsibility of
such Participants.
For further information with respect to the Medium-Term Notes, see
"Book-Entry System", "Description of the Secured Notes", and "Description
of the Unsecured Notes" herein and the applicable Pricing Supplement.
----------------------
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES
AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE
SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES
COMMISSION PASSED UPON THE ACCURACY OR ADEQUACY OF
THIS PROSPECTUS OR ANY SUPPLEMENT HERETO. ANY
REPRESENTATION TO THE CONTRARY IS
A CRIMINAL OFFENSE.
============= =============== ====================== ===================
PRICE TO AGENTS' PROCEEDS TO
PUBLIC(1) COMMISSIONS(2)(3) COMPANY(2)(4)
------------- --------------- ---------------------- -------------------
Per Note . 100% .125%-.750% 99.875%-99.250%
------------- --------------- ---------------------- -------------------
Total . . . $165,000,000 $206,250-$1,237,500 $164,793,750-
$163,762,500
============= =============== ====================== ===================
(1) Unless otherwise specified in the applicable Pricing Supplement,
Medium-Term Notes will be issued at 100% of their principal amount.
(2) The Company will pay commissions to any agents engaged by the Company
("Agents"), including Merrill Lynch & Co., Merrill Lynch, Pierce,
Fenner & Smith Incorporated and PaineWebber Incorporated, in the form
of discounts, ranging from .125% to .750% of the principal amount of
any Medium-Term Note, depending upon maturity, and may sell Medium-
Term Notes to any Agent, as principal. Unless otherwise indicated in
the applicable Pricing Supplement, a Medium-Term Note sold to an
Agent, as principal, will be purchased by such Agent at a price equal
to 100% of the principal amount thereof less a percentage equal to
the commission applicable to an agency sale of a Medium-Term Note of
identical maturity, and may be resold by such Agent to investors and
other purchasers at varying prices related to prevailing market
prices at the time of resale as determined by such Agent, or, if so
agreed, at a fixed public offering price. No commission will be
payable on any sales made directly by the Company.
(3) The Company has agreed to indemnify the Agents against certain
liabilities under the Securities Act of 1933.
(4) Assuming Medium-Term Notes are issued at 100% of their principal
amount and before deducting expenses payable by the Company estimated
at $252,000, including reimbursement of certain expenses of the
Agents.
----------------------
The Medium-Term Notes are being offered on a continuing basis by the
Company through the Agents, which have agreed to use their best efforts to
solicit purchases of the Medium-Term Notes. Medium-Term Notes may also be
sold to any Agent, as principal, for resale to investors and other
purchasers at varying prices related to prevailing market prices at the
time of resale, as determined by such Agent, or, if so agreed, at a fixed
public offering price. The Company reserves the right to sell Medium-Term
Notes directly to investors on its own behalf. The Medium-Term Notes will
not be listed on any securities exchange, and there can be no assurance
that the Medium-Term Notes offered by this Prospectus will be sold or that
there will be a secondary market for the Medium-Term Notes. The Company
reserves the right to withdraw, cancel or modify the offer made hereby
without notice. The Company or any Agent may reject, in whole or in part,
any offer to purchase Medium-Term Notes. See "Plan of Distribution".
----------------------
MERRILL LYNCH & CO. PAINEWEBBER INCORPORATED
----------------------
The date of this Prospectus is November __, 1996
<PAGE>
AVAILABLE INFORMATION
The Company is subject to the informational requirements of the
Securities Exchange Act of 1934, as amended ("Exchange Act"), and, in
accordance therewith, files reports and other information with the
Securities and Exchange Commission ("Commission"). Reports, proxy
statements and other information filed by the Company can be inspected
and copied at the public reference facilities of the Commission, Room
1024, Judiciary Plaza, 450 Fifth Street, N.W. Washington, D.C. 20549,
as well as at the following regional offices: Seven World Trade
Center, Suite 1300, New York, New York 10048, and 500 West Madison
Street, Suite 1400, Chicago, Illinois 60661. Copies of such material
can be obtained from the Public Reference Section of the Commission at
450 Fifth Street, N.W., Washington, D.C. 20549, at prescribed rates.
The Commission maintains a Web site (http://www.sec.gov) that contains
reports, proxy statements and other information filed electronically
by the Company.
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
There are hereby incorporated by reference in this Prospectus the
following documents heretofore filed with the Securities and Exchange
Commission:
(1) The Company's Annual Report on Form 10-K for the year ended
December 31, 1995.
(2) The Company's Quarterly Reports on Form 10-Q for the
quarters ended March 31 and June 30, 1996.
(3) The Company's Current Report on Form 8-K dated February 27,
1996.
All documents filed by the Company pursuant to Section 13(a),
13(c), 14 or 15(d) of the Exchange Act after the date of this
Prospectus and prior to the termination of this offering shall be
deemed to be incorporated by reference into this Prospectus. Any
statement contained in a document incorporated or deemed to be
incorporated by reference herein shall be deemed to be modified or
superseded, for purposes of this Prospectus, to the extent that a
statement contained herein or in any other subsequently filed document
which also is or is deemed to be incorporated by reference herein
modifies or supersedes such statement. Any statement so modified or
superseded shall not be deemed, except as so modified or superseded,
to constitute a part of this Prospectus.
The Company hereby undertakes to provide, without charge, to each
person to whom a copy of this Prospectus shall have been delivered,
upon written or oral request of such person, a copy of any or all of
the documents which have been incorporated in this Prospectus by
reference, other than exhibits to such documents, unless such exhibits
shall have been specifically incorporated by reference into such
documents. Requests for such copies should be directed to C.J. Rue,
Secretary, Northwest Natural Gas Company, One Pacific Square, 220 N.W.
Second Avenue, Portland, Oregon 97209, telephone 503-226-4211.
THE COMPANY
The Company's executive offices are located at One Pacific
Square, 220 N.W. Second Avenue, Portland, Oregon 97209. Its telephone
number is 503-226-4211. The Company and its predecessors have
supplied gas service to the public since 1859. The Company is
principally engaged in the distribution of natural gas to customers in
western Oregon and southwestern Washington, including the Portland
metropolitan area.
USE OF PROCEEDS AND FINANCING PROGRAM
The net proceeds to be received by the Company from the sale of
the Medium-Term Notes will be added to the general funds of the
Company and used for corporate purposes, primarily to fund, in part,
the Company's ongoing utility construction program.
The Company expects its utility construction expenditures in 1996
to aggregate $92 million, and in the five-year period, 1996-2000, to
aggregate between $500 million and $550 million.
It is estimated that 50% or more of the funds required for
utility purposes during the 1996-2000 period will be internally
generated and that the balance, as well as substantially all of the
funds required for the refunding of maturing and higher-cost debt,
will be raised through the sale of equity and debt securities,
including the Medium-Term Notes, in such amounts and at such times as
the Company's cash requirements and market conditions shall determine.
Approximately $21 million of debt securities matured in 1996 and
approximately $25 million and $15 million will mature in 1997 and
1998, respectively.
RATIO OF EARNINGS TO FIXED CHARGES
The ratios of earnings to fixed charges, calculated according to
the rules set forth under the Securities Act of 1933, as amended, for
the following twelve-month periods were:
TWELVE MONTHS ENDED
-------------------------------------------------------------------
JUNE 30, DECEMBER 31,
-------- ----------------------------------------------------
1996 1995 1994 1993 1992 1991
---- ---- ---- ---- ---- ----
3.54 3.15 3.08 3.22 1.81 1.59
Earnings consist of net income to which has been added taxes on
income and fixed charges. Fixed charges consist of interest on all
indebtedness, amortization of debt expense and discount or premium,
and the estimated interest portion of rentals charged to income.
BOOK-ENTRY SYSTEM
DTC will act as securities depository for the Medium-Term Notes
of each issue. Except under the circumstances described below, the
Medium-Term Notes will be issued in the form of one or more fully
registered notes that will be deposited with, or on behalf of, DTC or
such other depository as may be subsequently designated
("Depository"), and registered in the name of CEDE & Co. (DTC's
partnership nominee), or such other Depository or its nominee as may
be subsequently designated.
So long as the Depository, or its nominee, is the registered
owner of the Medium-Term Notes, such Depository or such nominee, as
the case may be, will be considered the owner of such Medium-Term
Notes for all purposes under the Mortgage or the Indenture (each as
defined below), as the case may be, including notices and voting.
Payments of principal of, and premium, if any, and interest on, the
Medium-Term Notes will be made to the Depository or its nominee, as
the case may be, as the registered owner of such Medium-Term Notes.
Except as set forth below, owners of beneficial interests in
Medium-Term Notes will not be entitled to have any individual
Medium-Term Notes registered in their names, will not receive or be
entitled to receive physical delivery of any such Medium-Term Notes
and will not be considered the owners of Medium-Term Notes under the
Mortgage or the Indenture. Accordingly, each person holding a
beneficial interest in a Medium-Term Note must rely on the procedures
of the Depository and, if such person is not a Direct Participant (as
hereinafter defined), on procedures of the Direct Participant through
which such person holds its interest, to exercise any of the rights of
the registered owner of such Medium-Term Note.
If the Depository is at any time unwilling or unable to continue
as depository and a successor depository is not appointed by the
Company, individual registered Medium-Term Notes will be issued in
exchange for the Medium-Term Notes held by the Depository. In
addition, the Company, at any time and in its sole discretion, may
determine not to have the Medium-Term Notes held by the Depository
and, in such event, individual registered Medium-Term Notes will be
issued in exchange for the Medium-Term Notes held by the Depository.
In any such instance, an owner of a beneficial interest in the Medium-
Term Notes will be entitled to physical delivery of individual Medium-
Term Notes equal in principal amount to such beneficial interest and
to have such Medium-Term Notes registered in its name. Individual
Medium-Term Notes so issued will be issued as registered Medium-Term
Notes in denominations of $1,000 or any amount in excess thereof that
is an integral multiple of $1,000.
The following is based solely on information furnished by DTC:
DTC is a limited-purpose trust company organized under the New
York Banking Law, a "banking organization" within the meaning of the
New York Banking Law, a member of the Federal Reserve System, a
"clearing corporation" within the meaning of the New York Uniform
Commercial Code, and a "clearing agency" registered pursuant to the
provisions of Section 17A of the Exchange Act. DTC holds securities
that its participants ("Participants") deposit with DTC. DTC also
facilitates the settlement among Participants of securities
transactions, such as transfers and pledges, in deposited securities
through electronic computerized book-entry changes in Participants'
accounts, thereby eliminating the need for physical movement of
securities certificates.
Direct Participants include securities brokers and dealers,
banks, trust companies, clearing corporations, and certain other
organizations ("Direct Participants"). DTC is owned by a number of
its Direct Participants and by The New York Stock Exchange, Inc., the
American Stock Exchange, Inc., and the National Association of
Securities Dealers, Inc. Access to the DTC system is also available
to others such as securities brokers and dealers, banks, and trust
companies that clear through or maintain a custodial relationship with
a Direct Participant, either directly or indirectly ("Indirect
Participants"). The rules applicable to DTC and its Participants are
on file with the Commission.
Purchases of the Medium-Term Notes under the DTC system must be
made by or through Direct Participants, which will receive a credit
for the Medium-Term Notes on DTC's records. The ownership interest of
each actual purchaser of each Medium-Term Note ("Beneficial Owner") is
in turn to be recorded on the Direct and Indirect Participants'
records. Beneficial Owners will not receive written confirmation from
DTC of their purchase, but Beneficial Owners are expected to receive
written confirmation providing details of the transaction, as well as
periodic statements of their holdings, from the Direct or Indirect
Participant through which the Beneficial Owner entered into the
transaction. Transfers of ownership interests in the Medium-Term
Notes are to be accomplished by entries made on the books of
Participants acting on behalf of Beneficial Owners. Beneficial Owners
will not receive certificates representing their ownership interests
in the Medium-Term Notes, except in the event that use of the book-
entry system for the Medium-Term Notes is discontinued.
To facilitate subsequent transfers, all Medium-Term Notes
deposited by Participants with DTC are registered in the name of CEDE
& Co. The deposit of Medium-Term Notes with DTC and their
registration in the name of CEDE & Co. effect no change in beneficial
ownership. DTC has no knowledge of the actual Beneficial Owners of
the Medium-Term Notes; DTC's records reflect only the identity of the
Direct Participants to whose accounts such Medium-Term Notes are
credited, which may or may not be the Beneficial Owners. The
Participants will remain responsible for keeping account of their
holdings on behalf of their customers.
Conveyance of notices and other communications by DTC to Direct
Participants, by Direct Participants to Indirect Participants, and by
Direct Participants and Indirect Participants to Beneficial Owners
will be governed by arrangements among them, subject to any statutory
or regulatory requirements as may be in effect from time to time.
If the Medium-Term Notes of any issue are redeemable prior to the
maturity date, redemption notices shall be sent to CEDE & Co. If less
than all of the Medium-Term Notes of any issue are being redeemed,
DTC's practice is to determine by lot the amount of the interest of
each Direct Participant in such issue to be redeemed.
Neither DTC nor CEDE & Co. will consent or vote with respect to
the Medium-Term Notes. Under its usual procedures, DTC mails an
Omnibus Proxy to the Company as soon as possible after the record
date. The Omnibus Proxy assigns CEDE & Co.'s consenting or voting
rights to those Direct Participants to whose accounts the Medium-Term
Notes are credited on the record date (identified in a listing
attached to the Omnibus Proxy).
Principal and interest payments on the Medium-Term Notes will be
made to DTC. DTC's practice is to credit Direct Participants' accounts
on the date on which interest is payable in accordance with their
respective holdings shown on DTC's records, unless DTC has reason to
believe that it will not receive payment on such payment date.
Payments by Participants to Beneficial Owners will be governed by
standing instructions and customary practices, as is the case with
securities held for the accounts of customers in bearer form or
registered in "street name", and will be the responsibility of such
Participant and not of DTC, the Mortgage Trustees (as defined below),
the Indenture Trustee (as defined below) or the Company, subject to
any statutory or regulatory requirements as may be in effect from time
to time. Payment of principal and interest to DTC is the
responsibility of the Company and the Corporate Trustee (as defined
below) or the Indenture Trustee, as the case may be. Disbursement of
such payments to Direct Participants shall be the responsibility of
DTC, and disbursement of such payments to the Beneficial Owners shall
be the responsibility of Direct and Indirect Participants.
DTC may discontinue providing services as securities depository
with respect to the Medium-Term Notes at any time by giving reasonable
notice to the Company, the Mortgage Trustees and the Indenture
Trustee.
----------------------
None of the Company or the Mortgage Trustees or the Indenture
Trustee will have any responsibility or liability for any aspect of
the records relating to or payments made on account of beneficial
interests in the Medium-Term Notes or for maintaining, supervising or
reviewing any records relating to such beneficial interests.
DESCRIPTION OF THE SECURED NOTES
GENERAL
The Secured Notes, which comprise a series of the Company's First
Mortgage Bonds ("Bonds"), are to be issued under the Company's
Mortgage and Deed of Trust, dated as of July 1, 1946, to Bankers Trust
Company ("Corporate Trustee") and R.G. Page (Stanley Burg, successor),
as trustees ("Mortgage Trustees"), as supplemented by twenty
supplemental indentures, all of which are collectively referred to as
the "Mortgage".
The statements herein concerning the Secured Notes and the
Mortgage are merely an outline and do not purport to be complete. They
make use of terms defined in the Mortgage and are qualified in their
entirety by express reference to the cited Sections and Articles. They
may be changed with respect to any Secured Note by the applicable
Pricing Supplement, which should be read in conjunction with this
description.
The Secured Notes will be offered on a continuing basis and each
Secured Note will mature on such date, not less than nine months or
more than 30 years from its date of issue, as selected by the
purchaser and agreed to by the Company.
The Pricing Supplement relating to each Secured Note will set
forth the principal amount, interest rate, issue price and Agent's
commission, original issue and maturity dates, redemption provisions,
if any, and other material terms of such Secured Note.
INTEREST
Interest on each Secured Note will be payable semi-annually in
arrears on June 1 and December 1 of each year and at maturity.
Interest payable on any interest payment date for any Secured
Note will be payable to the person in whose name such Secured Note is
registered on the record date with respect to such interest payment
date, which shall be the May 15 or November 15 (whether or not a
business day), as the case may be, next preceding such interest
payment date; provided that, (i) if the original issue date of any
Secured Note is after a record date and before the corresponding
interest payment date, such Secured Note shall bear interest from the
original issue date, but payment of interest shall commence on the
second interest payment date succeeding the original issue date, and
(ii) interest payable on the maturity date will be payable to the
person to whom the principal thereof shall be payable.
Unless otherwise indicated in the applicable Pricing Supplement,
interest on the Secured Notes will be computed on the basis of a
360-day year consisting of twelve 30-day months.
FORM, EXCHANGE AND PAYMENT
The Secured Notes will be issued in fully registered form in
denominations of $1,000 or any amount in excess thereof that is an
integral multiple of $1,000. The Secured Notes will be exchangeable at
the office of Bankers Trust Company in New York City, without charge
other than taxes or other governmental charges incident thereto.
Principal, premium, if any, and interest will be payable at such
office. (See Twentieth Supplemental, Sec. 1.01.) Notwithstanding the
foregoing, for so long as the Secured Notes shall be held by the
Depository or its nominee, owners of beneficial interests in the
Secured Notes will not be entitled to have any individual Secured
Notes registered in their names, and transfers of beneficial interests
and payments of principal, premium, if any, and interest will be made
as described herein under "Book-Entry System".
REDEMPTION
To the extent, if any, provided in the Pricing Supplement
relating to any Secured Note, such Secured Note will be redeemable, on
30 days' notice, in whole or in part, at any time on or after the
initial redemption date, if any, fixed at the time of sale and set
forth in the applicable Pricing Supplement. On or after the initial
redemption date, such Secured Note will be redeemable in whole or in
part, at the option of the Company at a redemption price determined in
accordance with the following paragraph, plus accrued interest to the
date fixed for redemption.
The redemption price for each Secured Note subject to redemption
shall, for the twelve-month period commencing on the initial
redemption date, be equal to a certain percentage of the principal
amount of such Secured Note and thereafter, shall decline for the
twelve-month period commencing on each anniversary of the initial
redemption date by a percentage of principal amount ("Reduction
Percentage") until the redemption price shall be 100% of the principal
amount. The initial redemption date and price and any Reduction
Percentage with respect to each Secured Note subject to redemption
will be fixed at the time of sale and set forth in the applicable
Pricing Supplement.
If so specified in the Pricing Supplement relating to any Secured
Note, the Company may not, prior to the redemption limitation date, if
any, set forth in such Pricing Supplement, redeem such Secured Note as
contemplated above as a part of, or in anticipation of, any refunding
operation by the application, directly or indirectly, of moneys
borrowed having an effective interest cost to the Company (calculated
in accordance with generally accepted financial practice) of less than
the effective interest cost to the Company (similarly calculated) of
such Secured Note.
If, at the time the notice of redemption shall be given, the
redemption money shall not be on deposit with the Corporate Trustee,
the redemption may be made subject to the receipt of such money before
the date fixed for redemption, and such notice shall be of no effect
unless such money shall be so received.
Unless otherwise indicated in the applicable Pricing Supplement,
the Secured Notes will not be subject to any sinking fund.
PROVISIONS FOR MAINTENANCE OF PROPERTY
While the Mortgage contains provisions for the maintenance of the
Mortgaged and Pledged Property, the Mortgage does not permit
redemption of Bonds pursuant to these provisions.
SECURITY
The Secured Notes together with all other Bonds now or hereafter
issued under the Mortgage will be secured by the Mortgage, which
constitutes, in the opinion of Bruce B. Samson, Esq., General Counsel
of the Company, a first mortgage lien on all of the gas plants,
distribution systems and other materially important physical
properties of the Company (except as stated below), subject to (a)
leases of minor portions of the Company's property to others for uses
which, in the opinion of such Counsel, do not interfere with the
Company's business, (b) leases of certain property of the Company not
used in its gas utility business or the gas by-product business, (c)
excepted encumbrances, and (d) minor defects and encumbrances
customarily found in properties of like size and character which, in
the opinion of such Counsel, do not impair the use of such properties
by the Company. There are excepted from the lien all cash and
securities; certain equipment, apparatus, materials or supplies;
aircraft, automobiles and other vehicles; receivables, contracts,
leases and operating agreements; timber, minerals, mineral rights and
royalties and all natural gas and oil production property.
The Mortgage contains provisions subjecting after-acquired
property (subject to pre-existing liens) to the lien thereof, subject
to limitations in the case of consolidation, merger or sale of
substantially all of the Company's assets. (See Mortgage, Art. XVI.)
The Mortgage provides that the Mortgage Trustees shall have a
lien upon the mortgaged property, prior to that of the Bonds, for the
payment of their reasonable compensation and expenses and for
indemnity against certain liabilities. (See Mortgage, Sec. 96).
ISSUANCE OF ADDITIONAL BONDS
Bonds may be issued from time to time on the basis of (1) 60% of
property additions, after adjustments to offset retirements (see
"Modification of the Mortgage -- Issuance of Additional Bonds" below);
(2) retirement of Bonds or qualified lien bonds; or (3) deposit of
cash. With certain exceptions in the case of (2) above, the issuance
of Bonds is subject to adjusted net earnings before income taxes for
12 consecutive months out of the preceding 15 months being at least
twice the annual interest requirements on all Bonds at the time
outstanding, including the additional issue, and all indebtedness of
prior rank.
Property additions generally include gas, electric, steam or hot
water property or gas by-product property acquired after March 31,
1946, but may not include securities, airplanes, automobiles or other
vehicles, or natural gas transmission lines or natural gas and oil
production property. As of June 30, 1996, approximately $341 million
of property additions and $93 million of retired Bonds were available
for use as the basis for the issuance of Bonds.
The Mortgage contains certain restrictions upon the issuance of
Bonds against property subject to liens.
The Secured Notes will be issued against property additions and
retired Bonds.
(See Mortgage, Secs. 4-7, 20-30 and 46, and Third Supplemental,
Secs. 3 and 4.)
RELEASE AND SUBSTITUTION OF PROPERTY
Property may be released against (1) deposit of cash or, to a
limited extent, purchase money mortgages, (2) property additions, or
(3) waiver of the right to issue Bonds without applying any earnings
test. Cash so deposited and cash deposited against the issuance of
additional bonds may be withdrawn upon the bases stated in (2) and (3)
above. When property released is not funded property, property
additions used to effect the release may again, in certain cases,
become available as credits under the Mortgage, and the waiver of the
right to issue Bonds to effect the release may, in certain cases,
cease to be effective as such a waiver. Similar provisions are in
effect as to cash proceeds of such property. The Mortgage contains
special provisions with respect to qualified lien bonds pledged and
the disposition of moneys received on pledged prior lien bonds. (See
Mortgage, Secs. 5, 31, 32, 37, 46 to 50, 59 to 61, 100 and 118.)
DEFAULTS AND NOTICE THEREOF
Defaults are: default in payment of principal, default for 60
days in payment of interest or of installments of funds for retirement
of Bonds; certain defaults with respect to qualified lien bonds;
certain events in bankruptcy, insolvency or reorganization; and
default for 90 days after notice in the case of a breach of any other
covenant. The Mortgage Trustees may withhold notice of default
(except in payment of principal, interest or any fund for the
retirement of Bonds) if they think it in the interest of the
Bondholders. (See Mortgage, Secs. 65 and 66).
Holders of 25% of the Bonds may declare the principal and the
interest due on default, but a majority may annul such declaration if
such default has been cured. No holder of Bonds may enforce the lien
of the Mortgage without giving the Mortgage Trustees written notice of
a default and unless holders of 25% of the Bonds have requested the
Mortgage Trustees to act and offered them reasonable opportunity to
act and the Mortgage Trustees have failed to act. The Mortgage
Trustees are not required to risk their funds or incur personal
liability if there is reasonable ground for believing that the
repayment is not reasonably assured. Holders of a majority of the
Bonds may direct the time, method and place of conducting any
proceedings for any remedy available to the Mortgage Trustees, or
exercising any trust or power conferred upon the Mortgage Trustees,
but the Mortgage Trustees are not required to follow such direction if
not sufficiently indemnified for expenditures. (See Mortgage, Secs.
67, 71, 80 and 94.)
EVIDENCE TO BE FURNISHED TO THE MORTGAGE TRUSTEES
Compliance with Mortgage provisions is evidenced by written
statements of the Company's officers or persons selected by the
Company. In certain major matters the accountant, engineer, appraiser
or other expert must be independent. Various certificates and other
papers, including an annual certificate with reference to compliance
with the terms of the Mortgage and absence of defaults, are required
to be filed annually and upon the occurrence of certain events. (See
Mortgage, Secs. 38-46.)
MODIFICATION OF THE MORTGAGE
The rights of the Bondholders may be modified with the consent of
70% of the Bonds and, if less than all series of Bonds are affected,
the consent also of 70% of Bonds of each series affected. The Company
has the right, without any consent or other action by holders of any
series of Bonds, to substitute 66 % for 70%. In general, no
modification of the terms of payment of principal and interest,
affecting the lien of the Mortgage or reducing the percentage required
for modification (except as provided above) will be effective against
any Bondholder without his consent. (See Mortgage, Art. XIX and Ninth
Supplemental, Sec.6.)
The Company has reserved the right to amend the Mortgage, without
any consent or other action by holders of the Bonds of the Nineteenth
Series or of Bonds of any subsequently created series (including the
Secured Notes), in the following respects:
Release and Substitution of Property
To permit the release of property at the lesser of its cost or
its fair value at the time that such property became funded property,
rather than at its fair value at the time of its release; and to
facilitate the release of unfunded property. (See Mortgage, Secs. 3,
59 and 60 and Eighteenth Supplemental, Sec. 2.03.)
Issuance of Additional Bonds
To clarify that (i) for purposes of determining annual interest
requirements, interest on Bonds or other indebtedness bearing interest
at a variable interest rate shall be computed at the average of the
interest rates borne by such Bonds or other indebtedness during the
period of calculation or, if such Bonds or other indebtedness shall
have been issued after such period or shall be the subject of pending
applications, interest shall be computed at the initial rate borne
upon issuance, and (ii) no extraordinary items shall be included in
operating expenses or deducted from revenues or other income in
calculating adjusted net earnings (See Mortgage, Sec. 7); and to
revise the basis for the issuance of additional Bonds from 60% of
property additions, after adjustments to offset retirements, to 70%.
(See Mortgage, Secs. 25, 26, 59 and 61 and Eighteenth Supplemental,
Secs. 2.01 and 2.02)
THE CORPORATE TRUSTEE
Bankers Trust Company also serves as the Indenture Trustee under
the Indenture under which the Unsecured Notes are issued.
DESCRIPTION OF THE UNSECURED NOTES
GENERAL
The Unsecured Notes are to be issued under an Indenture, dated as
of June 1, 1991 ("Indenture"), between the Company and Bankers Trust
Company, as trustee ("Indenture Trustee").
The statements herein concerning the Unsecured Notes and the
Indenture are merely an outline and do not purport to be complete.
They make use of terms defined in the Indenture and are qualified in
their entirety by express reference to the cited Sections and
Articles. They may be changed with respect to any Unsecured Note by
the applicable Pricing Supplement, which should be read in conjunction
with this description.
The Indenture provides that debt securities (including the
Unsecured Notes and including both interest bearing and original issue
discount securities) may be issued thereunder, without limitation as
to aggregate principal amount. (See Indenture, Sec. 301.) All debt
securities heretofore or hereafter issued under the Indenture
(including the Unsecured Notes) are collectively referred to as the
"Indenture Securities". The Indenture does not limit the amount of
other debt, secured or unsecured, which may be issued by the Company.
The Unsecured Notes will rank pari passu with all other unsecured and
unsubordinated indebtedness of the Company. Substantially all of the
gas plants, distribution systems and other materially important
physical properties of the Company are subject to the lien of the
Mortgage securing the Company's Bonds. (See "Description of the
Secured Notes Security and Issuance of Additional Bonds", above.)
The Unsecured Notes will be offered on a continuing basis, and
each Unsecured Note will mature on such date, not less than nine
months nor more than 30 years from its date of issue, as selected by
the purchaser and agreed to by the Company.
The Pricing Supplement relating to any Unsecured Note will set
forth the principal amount, interest rate, issue price and Agent's
commission, original issue and maturity dates, redemption provisions,
if any, and other material terms of such Unsecured Note.
INTEREST
Interest on each Unsecured Note will be payable semi-annually in
arrears on June 1 and December 1 of each year and at maturity.
Interest payable on any interest payment date for any Unsecured
Note will be payable to the person in whose name such Unsecured Note
is registered on the record date with respect to such interest payment
date, which shall be the May 15 or November 15 (whether or not a
business day), as the case may be, next preceding such interest
payment date; provided that, (i) if the original issue date of any
Unsecured Note is after a record date and before the corresponding
interest payment date, such Unsecured Note will bear interest from the
original issue date but payment of interest shall commence on the
second interest payment date succeeding the original issue date, and
(ii) interest payable on the maturity date will be payable to the
person to whom the principal thereof shall be payable.
Unless otherwise indicated in the applicable Pricing Supplement,
interest on the Unsecured Notes will be computed on the basis of a
360-day year consisting of twelve 30-day months.
FORM, EXCHANGE AND PAYMENT
The Unsecured Notes will be issued in fully registered form in
denominations of $1,000 or any amount in excess thereof that is an
integral multiple of $1,000. The Unsecured Notes will be exchangeable
at the office of Bankers Trust Company in New York City, without
charge other than taxes or other governmental charges incident
thereto. Principal, premium, if any, and interest will be payable at
such office. Notwithstanding the foregoing, for so long as the
Unsecured Notes shall be held by the Depository or its nominee, owners
of beneficial interests in the Unsecured Notes will not be entitled to
have any individual Unsecured Notes registered in their names, and
transfers of beneficial interests and payments of principal, premium,
if any, and interest will be made as described herein under
"Book-Entry System".
REDEMPTION
To the extent, if any, provided in the Pricing Supplement
relating to any Unsecured Note, such Unsecured Note will be
redeemable, on not less than 30 days' notice, in whole or in part, at
any time on or after the initial redemption date, if any, fixed at
the time of sale and set forth in the applicable Pricing Supplement.
On or after the initial redemption date, such Unsecured Note will be
redeemable in whole or in part, at the option of the Company, at a
redemption price determined in accordance with the following
paragraph, plus accrued interest to the date fixed for redemption.
The redemption price for each Unsecured Note subject to
redemption shall, for the twelve-month period commencing on the
initial redemption date, be equal to a certain percentage of the
principal amount of such Unsecured Note and, thereafter, shall decline
for the twelve-month period commencing on each anniversary of the
initial redemption date by a percentage of principal amount
("Reduction Percentage") until the redemption price shall be 100% of
the principal amount. The initial redemption price and date and any
Reduction Percentage with respect to each Unsecured Note subject to
redemption will be fixed at the time of sale and set forth in the
applicable Pricing Supplement.
If so specified in the Pricing Supplement relating to any
Unsecured Note, the Company may not, prior to the redemption
limitation date, if any, set forth in such Pricing Supplement, redeem
such Unsecured Note as contemplated above as a part of, or in
anticipation of, any refunding operation by the application, directly
or indirectly, of moneys borrowed having an effective interest cost to
the Company (calculated in accordance with generally accepted
financial practice) of less than the effective interest cost to the
Company (similarly calculated) of such Unsecured Note.
If, at the time the notice of redemption shall be given, the
redemption money shall not be on deposit with the Indenture Trustee,
the redemption shall be made subject to the receipt of such money on
or before the date fixed for redemption, and such notice shall be of
no effect unless such money shall be so received. (See Indenture, Art.
Four.)
Unless otherwise indicated in the applicable Pricing Supplement,
the Unsecured Notes will not be subject to any sinking fund.
EVENTS OF DEFAULT AND NOTICE THEREOF
Events of Default are: default for three Business Days in payment
of principal; default for 60 days in payment of interest; certain
events in bankruptcy, insolvency or reorganization; default for 90
days after notice in the case of a breach of any other covenant; and
any other Event of Default specified with respect to the Indenture
Securities of a particular series. No Event of Default with respect to
a series of Indenture Securities necessarily constitutes an Event of
Default with respect to the Indenture Securities of any other series.
The Indenture Trustee may withhold notice of default (except in
payment of principal, interest or any funds for the retirement of
Indenture Securities) if it, in good faith, determines that
withholding of such notice is in the interest of the Holders of the
Indenture Securities. (See Indenture, Secs. 801 and 903.)
Either the Indenture Trustee or the Holders of not less than 33%
in principal amount (or such lesser amount as may be provided in the
case of discount Indenture Securities) of the outstanding Indenture
Securities of all defaulted series, considered as one class, may
declare the principal and interest on such series due on default, but
the Company may annul such default by effecting its cure and paying
overdue interest and principal. No Holder of Indenture Securities may
enforce the Indenture without having given the Indenture Trustee
written notice of default, and unless the Holders of a majority of the
Indenture Securities of all defaulted series, considered as one class,
shall have requested the Indenture Trustee to act and offered
reasonable indemnity, and for 60 days the Indenture Trustee shall have
failed to act. But, each Holder has an absolute right to receive
payment of principal and interest when due and to institute suit for
the enforcement of such payment. The Indenture Trustee is not required
to risk its funds or incur any financial liability if it shall have
reasonable grounds for believing that repayment is not reasonably
assured. The Holders of a majority of the Indenture Securities of all
defaulted series, considered as one class, may direct the time, method
and place of conducting any proceedings for any remedy available to
the Indenture Trustee, or exercising any trust or power conferred on
the Indenture Trustee, with respect to the Indenture Securities of
such series, but the Indenture Trustee is not required to follow such
direction if not sufficiently indemnified and the Indenture Trustee
may take any other action it deems proper which is not inconsistent
with such direction. (See Indenture, Secs. 802, 807, 808, 812 and
902.)
EVIDENCE TO BE FURNISHED TO THE INDENTURE TRUSTEE
Compliance with Indenture provisions will be evidenced by written
statements of the Company's officers. An annual certificate with
reference to compliance with the covenants and conditions of the
Indenture and the absence of defaults is required to be filed with the
Indenture Trustee. (See Indenture, Sec.1004.)
MODIFICATION OF THE INDENTURE
The rights of the Holders of the Indenture Securities may be
modified with the consent of the Holders of a majority of the
Indenture Securities of all series or Tranches, as defined below,
affected, considered as one class. However, certain specified rights
of the Holders of Indenture Securities may be modified without the
consent of the Holders if such modification would not be deemed
adversely to affect their interests in any material respect. In
general, no modification of the terms of payment of principal and
interest, no reduction of the percentage in principal amount of the
Indenture Securities outstanding under such series required to consent
to any supplemental indenture or waiver under the Indenture, no
reduction of such percentage necessary for quorum and voting, and no
modification of certain of the provisions in the Indenture relating to
supplemental indentures, waivers of certain covenants and waivers of
past defaults is effective against any Holder of Indenture Securities
without his consent. "Tranche" means a group of Indenture Securities
which are of the same series and have identical terms except as to
principal amount and/or date of issuance. (See Indenture, Art.
Twelve.)
THE INDENTURE TRUSTEE
Bankers Trust Company also serves as the Corporate Trustee under
the Mortgage under which the Secured Notes are issued.
PLAN OF DISTRIBUTION
The Medium-Term Notes are being offered on a continuing basis for
sale by the Company through the Agents which have agreed to use their
best efforts to solicit purchases of the Medium-Term Notes. The
initial Agents are Merrill Lynch & Co., Merrill Lynch, Pierce, Fenner
& Smith Incorporated and PaineWebber Incorporated. Should the Company
designate other persons to act as Agents, the names of such persons
will be disclosed in a Pricing Supplement. The Company will pay each
Agent a commission which, depending on the maturity of the Medium-Term
Notes, will range from .125% to .750% of the principal amount of any
Medium-Term Note sold through such Agent. The Company may also sell
Medium-Term Notes to any Agent, as principal, at a discount from the
principal amount thereof, and the Agent may later resell such Medium-
Term Notes to investors and other purchasers at varying prices related
to prevailing market prices at the time of resale as determined by
such Agent or, if so agreed, at a fixed public offering price. In the
case of sales to any Agent as principal, such Agent may utilize a
selling or dealer group in connection with resales. An Agent may sell
Medium-Term Notes it has purchased as principal to any dealer at a
discount and, unless otherwise specified in the applicable Pricing
Supplement, such discount allowed to any dealer will not be in excess
of the discount to be received by such Agent from the Company. After
the initial public offering of Medium-Term Notes to be resold to
investors and other purchasers, the public offering price (in the case
of a fixed price public offering), concession and discount may be
changed. The Medium-Term Notes also may be sold by the Company
directly to purchasers. No commission will be payable to the Agents
on Medium-Term Notes sold directly by the Company.
The Company reserves the right to withdraw, cancel or modify the
offer made hereby without notice and may reject, in whole or in part,
offers to purchase Medium-Term Notes whether placed directly with the
Company or through one of the Agents. Each Agent will have the right,
in its discretion reasonably exercised, to reject any offer to
purchase Medium-Term Notes received by it, in whole or in part.
Payment of the purchase price of the Medium-Term Notes will be
required to be made in immediately available funds in New York City on
the date of settlement.
No Medium-Term Note will have an established trading market when
issued. The Medium-Term Notes will not be listed on any securities
exchange. Each of the Agents may from time to time purchase and sell
Medium-Term Notes in the secondary market, but is not obligated to do
so, and there can be no assurance that there will be a secondary
market for the Medium-Term Notes or liquidity in the secondary market
if one develops. From time to time, each of the Agents may make a
market in the Medium-Term Notes.
The Agents may be deemed to be "underwriters" within the meaning
of the Securities Act of 1933, as amended. The Company has agreed to
indemnify each of the Agents against, or to make contributions
relating to, certain liabilities, including liabilities under such
Act. The Company has agreed to reimburse each of the Agents for
certain expenses. Each of the Agents may engage in transactions with,
or perform services for, the Company in the ordinary course of
business.
EXPERTS
The financial statements incorporated in this Prospectus by
reference from the Company's Annual Report on Form 10-K have been
audited by Deloitte & Touche LLP, independent auditors, as stated in
their report, which is incorporated herein by reference, and have been
so incorporated in reliance upon the report of such firm given upon
their authority as experts in accounting and auditing.
With respect to the unaudited interim financial information which
is incorporated herein by reference from the Company's Quarterly
Reports on Form 10-Q since the Company's latest Annual Report on Form
10-K, which is incorporated herein by reference, Deloitte & Touche LLP
have applied limited procedures in accordance with professional
standards for review of such information. However, as stated in their
reports included in the Company's Quarterly Reports on Form 10-Q for
such quarterly periods, and incorporated herein by reference, they did
not audit and they do not express an opinion on that interim financial
information. Accordingly, the degree of reliance on their reports on
such information should be restricted in light of the limited nature
of the review procedures applied. Deloitte & Touche LLP are not
subject to the liability provisions of Section 11 of the Securities
Act of 1933 for their reports on the unaudited interim financial
information because such reports are not "reports" or a "part" of the
registration statement prepared or certified by an accountant within
the meaning of Sections 7 and 11 of such Act.
The statements made as to matters of law and legal conclusions in
the documents incorporated in this Prospectus by reference and under
"Description of the Secured Notes" herein have been reviewed by Bruce
B. Samson, Esquire, Portland, Oregon. Mr. Samson is General Counsel
of the Company. These statements and conclusions are set forth in
reliance upon the opinion of Mr. Samson given upon his authority as an
expert. The statements made as to matters of law and legal
conclusions under "Description of the Unsecured Notes" herein have
been reviewed by Messrs. Reid & Priest LLP, New York, New York. These
statements and conclusions are set forth in reliance upon the opinion
of Messrs. Reid & Priest LLP given upon their authority as experts.
As of September 30, 1996, Mr. Samson owned 8,700 shares of the
Company's common stock (including approximately 2,612 shares held in
Company's Retirement K Savings Plan at June 30, 1996) and has been
granted options to purchase 6,091 shares at a price of $16.59, 3,000
shares at a price of $24.00 per share and 7,500 shares at a price of
$20.92 per share, the market prices of the shares on the dates of such
grants as adjusted to reflect a 3-for-2 split of the Company's Common
Stock. Mr. Samson's shares, including the underlying shares subject
to options granted to him, have a current fair market value of
approximately $632,000.
LEGALITY
The legality of the Medium-Term Notes will be passed upon for the
Company by Mr. Samson and by Messrs. Reid & Priest LLP, New York, New
York, and for the agents by Messrs. Simpson Thacher & Bartlett (a
partnership which includes professional corporations), New York, New
York. However, all matters pertaining to titles, the lien and
enforceability of the Mortgage, franchises and all other matters of
Oregon and Washington law, will be passed upon only by Mr. Samson.
<PAGE>
===================================== =============================
NO DEALER, SALESMAN OR ANY OTHER
PERSON HAS BEEN AUTHORIZED TO GIVE
ANY INFORMATION OR TO MAKE ANY
REPRESENTATIONS NOT CONTAINED IN
THIS PROSPECTUS, AND, IF GIVEN OR
MADE, SUCH INFORMATION OR
REPRESENTATION MUST NOT BE RELIED
UPON AS HAVING BEEN AUTHORIZED BY
THE COMPANY. THIS PROSPECTUS DOES
NOT CONSTITUTE AN OFFER OF ANY
SECURITIES OTHER THAN THOSE TO WHICH
IT RELATES OR AN OFFER TO SELL, OR A $165,000,000
SOLICITATION OF AN OFFER TO BUY, TO
ANY PERSON IN ANY JURISDICTION WHERE
SUCH AN OFFER OR SOLICITATION WOULD
BE UNLAWFUL. NEITHER THE DELIVERY
OF THIS PROSPECTUS NOR ANY SALE MADE
HEREUNDER SHALL, UNDER ANY
CIRCUMSTANCES, CREATE ANY
IMPLICATION THAT THE INFORMATION
CONTAINED HEREIN IS CORRECT AS OF
ANY TIME SUBSEQUENT TO THE DATE NORTHWEST
HEREOF. NATURAL GAS
COMPANY
TABLE OF CONTENTS
SECURED MEDIUM-TERM NOTES,
Available Information . . . . . 2 SERIES B
(SERIES OF FIRST MORTGAGE BONDS)
Incorporation of Certain AND
Documents by Reference . . . 2 UNSECURED MEDIUM-TERM NOTES,
SERIES B
The Company . . . . . . . . . . 2
Due from Nine Months to
Use of Proceeds and 30 Years from Date of Issue
Financing Program . . . . . . 2
Ratio of Earnings to . . . . . -------------------
Fixed Charges . . . . . . . . 3 P R O S P E C T U S
-------------------
Book-Entry System . . . . . . . 3
Description of the
Secured Notes . . . . . . . . 5 MERRILL LYNCH & CO.
Description of the PAINEWEBBER INCORPORATED
Unsecured Notes . . . . . . . 8
Plan of Distribution . . . . . 10
Experts . . . . . . . . . . . . 10
Legality . . . . . . . . . . .
11 November __, 1996
=================================== ===================================
<PAGE>
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 14. OTHER EXPENSES OF ISSUANCE AND
DISTRIBUTION (ESTIMATED, EXCEPT
SEC FILING FEE).
Filing Fee-Securities and Exchange
Commission . . . . . . . . . . . . . $ 45,455
Fees of Trustees, including counsel
and authentication fees . . . . . . . 10,000
Legal fees . . . . . . . . . . . . . . 100,000
Accounting fees and expenses . . . . . 15,000
Rating Agencies' fees . . . . . . . . 60,000
Printing and engraving . . . . . . . . 10,000
Miscellaneous expense . . . . . . . . 11,545
--------
Total expenses . . . . . . . . . . . $252,000
========
ITEM 15. INDEMDEMNIFICATION OF DIRECTORS AND OFFICERS.
The Oregon Business Corporation Act (the "Act") provides, in general,
that a director or officer of a corporation who has been or is
threatened to be made a defendant in a legal proceeding because that
person is or was a director or officer of the corporation:
(1) shall be indemnified by the corporation for all expenses of such
litigation when the director or officer is wholly successful on the
merits or otherwise;
(2) may be indemnified by the corporation for the expenses,
judgments, fines and amounts paid in settlement of such litigation
(other than a derivative lawsuit) if he or she acted in good faith and
in a manner reasonably believed to be in, or at least not opposed to,
the best interests of the corporation (and, in the case of a criminal
proceeding, had no reasonable cause to believe the conduct was
unlawful); and
(3) may be indemnified by the corporation for expenses of a
derivative lawsuit (a suit by a shareholder alleging a breach by a
director or officer of a duty owed to the corporation) if he or she
acted in good faith and in a manner reasonably believed to be in, or
at least not opposed to, the best interests of the corporation, pro-
vided the director or officer is not adjudged liable to the
corporation.
The Act also authorizes the advancement of litigation expenses to a
director or officer upon receipt of a written affirmation of the
director's or officer's good faith belief that the standard of conduct
in Section (2) or (3) above has been met and an undertaking by such
director or officer to repay such expenses if it is ultimately
determined that he or she did not meet that standard and, therefore,
is not entitled to be indemnified. The Act also provides that the
indemnification provided thereunder shall not be deemed exclusive of
any other rights to which those indemnified may be entitled under any
bylaw, agreement, vote of shareholders or disinterested directors or
otherwise.
The Company's Bylaws provide that the Company shall indemnify
directors and officers to the fullest extent permitted under the Act,
thus making mandatory the discretionary indemnification authorized by
the Act.
The Company's Restated Articles of Incorporation provide that the
Company shall indemnify its officers and directors to the fullest
extent permitted by law, which may be broader than the indemnification
authorized by the Act.
The Company's shareholders have approved and the Company has entered
into indemnity agreements with its directors and officers which
provide for indemnity to the fullest extent permitted by law and also
alter or clarify the statutory indemnity in the following respects:
(1) prompt advancement of litigation expenses is provided if the
director or officer makes the required affirmation and undertaking;
(2) the director or officer is permitted to enforce the indemnity
obligation in court and the burden is on the Company to prove that the
director or officer is not entitled to indemnification;
(3) indemnity is explicitly provided for judgments and settlements in
derivative actions;
(4) prompt indemnification is provided unless a determination is made
that the director or officer is not entitled to indemnification; and
(5) partial indemnification is permitted if the director or officer
is not entitled to full indemnification.
The Company maintains in effect a policy of insurance providing for
reimbursement to the Company of payments made to directors and
officers as indemnity for damages, judgments, settlements, costs and
expenses incurred by them which the Company may be required or
permitted to make according to applicable law, common or statutory, or
under provisions of its Restated Articles of Incorporation, Bylaws or
agreements effective under such laws.
ITEM 16. LIST OF EXHIBITS.
1 - Form of Distribution Agreement.
4(a)* - Copy of Mortgage and Deed of Trust, dated as of July 1,
1946, to Bankers Trust Company and R.G. Page (to whom
Stanley Burg is now successor), Trustees (filed as
Exhibit 7(j) in File No. 2-6494), together with
Indentures supplemental thereto Nos. 1 through 14,
dated, respectively, as of June 1, 1949, March 1, 1954,
April 1, 1956, February 1, 1959, July 1, 1961, January
1, 1964, March 1, 1966, December 1, 1969, April 1,
1971, January 1, 1975, December 1, 1975, July 1, 1981,
June 1, 1985, and November 1, 1985 (filed as Exhibit
4(d) in File No. 33-1929); No. 15, dated as of July 1,
1986 (filed as Exhibit (4)(c) in File No. 33-24168);
Nos. 16, 17 and 18, dated, respectively, as of November
1, 1988, October 1, 1989 and July 1, 1990 (filed as
Exhibit (4)(c) in File No. 33-40482); No. 19, dated as
of June 1, 1991 (filed as Exhibit 4(c) in File No. 33-
64014; and No. 20, dated as of June 1, 1993 (filed as
Exhibit 4(c) in File No. 33-53795).
4(b)* - Copy of Indenture, dated as of June 1, 1991, to Bankers
Trust Company, Trustee, relating to the Unsecured Notes
(filed as Exhibit 4(e) in File No. 33-64014).
4(c)* - Form of Officers' Certificate establishing series of
Unsecured Notes and Form of Instructions for both
Secured and Unsecured Notes (filed as Exhibit 4(f) in
File No. 33-64014).
5(a) - Opinion of Bruce B. Samson, Esquire.
5(b) - Opinion of Messrs. Reid & Priest LLP.
12* - Computation of Ratio of Earnings to Fixed Charges
(filed as Exhibit 12 to Form 10-Q for the quarter ended
June 30, 1996).
15 - Letter of Deloitte & Touche LLP dated October 31, 1996
regarding unaudited interim financial information.
23 - Consent of Deloitte & Touche LLP. (The consents of
Bruce B. Samson, Esquire, and of Reid & Priest LLP are
included in their opinions filed, respectively, as
Exhibits 5(a) and 5(b)).
24 - Power of Attorney (see page II-3).
25(a) - Statement of Eligibility of the Corporate Mortgage
Trustee on Form T-1.
25(b) - Statement of Eligibility of the Individual Mortgage
Trustee on Form T-2.
25(c) - Statement of Eligibility of the Indenture Trustee on
Form T-1.
-----------------------------
* Incorporated herein by reference as indicated.
<PAGE>
ITEM 17. UNDERTAKINGS.
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, indivi-
dually or in the aggregate, represent a fundamental change in
the information set forth in the 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 the undertakings set forth in paragraphs (i)
and (ii) above do not apply if the registration statement is on Form
S-3 and the information required to be included in a post-effective
amendment by those paragraphs is contained in periodic reports filed
by the registrant pursuant to section 13 or section 15(d) of the
Securities Exchange Act of 1934 that are incorporated by reference in
this registration statement.
(2) That, for the purpose of determining liability under the
Securities Act of 1933, each such post-effective amendment that
contains a form of prospectus 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.
(3) To remove from registration by means of a post-effective
amendment any of the securities being registered which remain unsold
at the termination of the offering.
The undersigned registrant hereby 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
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.
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 of this registration statement, 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 Securities Act of 1933 and is, therefore,
unenforceable. In the event that a claim for indemnification against
such liabilities (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 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 appro-
priate jurisdiction the question whether such indemnification by it is
against public policy as expressed in the Securities Act of 1933 and
will be governed by the final adjudication of such issue.
POWER OF ATTORNEY
Each director and/or officer of the registrant whose signature appears
hereinafter hereby appoints Richard G. Reiten, Bruce R. DeBolt and
John T. Hood, the Agents for Service named in this registration
statement, and each of them severally, as his attorney-in-fact to sign
in his name and behalf, in any and all capacities stated below, and to
file with the Securities and Exchange Commission, any and all
amendments, including post-effective amendments, to this registration
statement, and the registrant hereby also appoints each such Agent for
Service as its attorney-in-fact with like authority to sign and file
any such amendments in its name and behalf.
<PAGE>
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 Portland, and
State of Oregon on the 31st day of October, 1996.
NORTHWEST NATURAL GAS COMPANY
By /s/ Richard G. Reiten
----------------------------
Richard G. Reiten,
President and Chief Operating Officer, and
Director
Pursuant to the requirements of the Securities Act of 1933, this
registration statement has been signed below by the following persons
in the capacities and on the date indicated.
Signature Title Date
--------- ------ ------
/s/ Robert L. Ridgley Principal Executive
------------------------- Officer and Director October 31, 1996
Robert L. Ridgley,
Chief Executive Officer
/s/ Richard G. Reiten Director October 31, 1996
------------------------
Richard G. Reiten,
President and Chief
Operating Officer
/s/ Bruce R. DeBolt Principal Financial
------------------------- Officer October 31, 1996
Bruce R. DeBolt,
Senior Vice President,
Finance, and Chief
Financial Officer
/s/ D. James Wilson Principal Accounting
------------------------- Officer October 31, 1996
D. James Wilson,
Treasurer and Controller
/s/ Mary Arnstad
------------------------ Director )
Mary Arnstad )
)
/s/ Thomas E. Dewey, Jr )
------------------------- Director )
Thomas E. Dewey, Jr. )
) October 31, 1996
/s/ Tod R. Hamachek )
---------------------- Director )
Tod R. Hamachek )
)
/s/ Richard B. Keller )
---------------------- Director )
Richard B. Keller )
)
/s/ Wayne D. Kuni )
---------------------- Director )
Wayne D. Kuni )
)
/s/ Randall C. Pape )
---------------------- Director )
Randall C. Pape )
)
/s/ Dwight A. Sangrey )
---------------------- Director )
Dwight A. Sangrey )
)
/s/ Melody C. Teppola )
---------------------- Director )
Melody C. Teppola )
)
/s/ Russell F. Tromley )
---------------------- Director )
Russell F. Tromley )
)
/s/ Benjamin R. Whiteley )
---------------------- Director )
Benjamin R. Whiteley )
<PAGE>
INDEX TO EXHIBITS
Exhibit
-------
1 Form of Distribution Agreement
4(a)* Copy of Mortgage and Deed of Trust, dated as of July
1, 1946, to Bankers Trust Company and R.G. Page (to
whom Stanley Burg is now successor), Trustees (filed
as Exhibit 7(j) in File No. 2-6494), together with
Indentures supplemental thereto (Nos. 1 through 14,
dated, respectively, as of June 1, 1949, March 1,
1954, April 1, 1956, February 1, 1959, July 1, 1961,
January 1, 1964, March 1, 1966, December 1, 1969,
April 1, 1971, January 1, 1975, December 1, 1975,
July 1, 1981, June 1, 1985, and November 1, 1985
(filed as Exhibit 4(d) in File No. 33-1929); No. 15,
dated as of July 1, 1986 (filed as Exhibit (4)(c) in
File No. 33-24168); Nos. 16, 17 and 18, dated,
respectively, as of November 1, 1988, October 1,
1989 and July 1, 1990 (filed as Exhibit (4)(c) in
File No. 33-40482); No. 19, dated as of June 1, 1991
(filed as Exhibit 4(c) in File No. 33-64014; and No.
20, dated as of June 1, 1993 (filed as Exhibit 4(c)
in File No. 33-53795).
4(b)* Copy of Indenture, dated as of June 1, 1991, to
Bankers Trust Company, Trustee, relating to the
Unsecured Notes (filed as Exhibit 4(e) in File No.
33-64014).
4(c)* Form of Officers' Certificate establishing series of
Unsecured Notes and Form of Instructions for both
Secured and Unsecured Notes (filed as Exhibit 4(f)
in File No. 33-64014).
5(a) Opinion of Bruce B. Samson, Esquire
5(b) Opinion of Messrs. Reid & Priest LLP
12* Computation of Ratio of Earnings to Fixed Charges
(filed as Exhibit 12 to Form 10-Q for the quarter
ended June 30, 1996).
15 Letter of Deloitte & Touche LLP dated October 31,
1996 regarding unaudited interim financial
information.
23 Consent of Deloitte & Touche LLP. (The consents of
Bruce B. Samson, Esquire, and of Reid & Priest LLP
are included in their opinions filed, respectively,
as Exhibits 5(a) and 5(b)).
24 Power of Attorney (see page II-3).
25(a) Statement of Eligibility of the Corporate Mortgage
Trustee Form T-1.
25(b) Statement of Eligibility of the Individual Mortgage
Trustee on Form T-2.
25(c) Statement of Eligibility of the Indenture Trustee on
Form T-1.
-----------------------------------
* Previously Filed
EXHIBIT 1
----------
Northwest Natural Gas Company
$165,000,000
Medium-Term Notes, Series B
Distribution Agreement
----------------------
__________, 1996
Merrill Lynch & Co.
Merrill Lynch, Pierce, Fenner & Smith
Incorporated
World Financial Center
North Tower
New York, New York 10281
PaineWebber Incorporated
1285 Avenue of the Americas
New York, New York 10019
Dear Sirs:
Northwest Natural Gas Company, an Oregon corporation (the
"Company"), proposes to issue and sell from time-to-time not to exceed
$165,000,000 of its First Mortgage Bonds, designated Secured Medium-
Term Notes, Series B (the "Secured Notes"), and its Unsecured Medium-
Term Notes, Series B (the "Unsecured Notes", and, together with the
Secured Notes, the "Securities"). The Secured Notes will be issued
under the Company's Mortgage and Deed of Trust, dated as of July 1,
1946, to Bankers Trust Company (the "Mortgage Trustee" or the
"Trustee") and R.G. Page (Stanley Burg, successor), as trustees, as
supplemented (such Mortgage and Deed of Trust as supplemented being
hereinafter referred to as the "Mortgage" or the "Indenture"). The
Unsecured Notes will be issued under an indenture, dated as of June 1,
1991 (the "Note Indenture" or the "Indenture"), between the Company
and Bankers Trust Company, as trustee (the "Indenture Trustee" or the
"Trustee"). The Securities shall have the maturities, interest rates,
if any, redemption provisions and other terms set forth in the
Prospectus referred to below, as it may be amended or supplemented
from time-to-time. The Securities will be issued, and the terms
thereof established, from time-to-time, by the Company in accordance
with the respective Indentures.
The Company represents, warrants, covenants and agrees with
each of you and with each other person which shall become a party to
this agreement (individually, an "Agent", and collectively, the
"Agents") and each Agent, severally and not jointly, covenants and
agrees with the Company as follows:
1. Representations and Warranties of the Company.
---------------------------------------------
The Company represents and warrants to each Agent that:
(a) The Company is a corporation duly organized and validly
existing in good standing under the laws of the State of Oregon,
and is qualified to do business and is in good standing as a
foreign corporation in the State of Washington, with power
(corporate and other) to own its properties and conduct its
business as described in the Prospectus referred to below.
(b) An initial registration statement on Form S-3
(Registration No. 33-64014) (the "Initial Registration
Statement") in respect of $150,000,000 aggregate principal amount
of the Company's First Mortgage Bonds designated Secured Medium-
Term Notes Series B, and Unsecured Medium-Term Notes Series B (of
which $15,000,000 remain unsold on the date hereof) has been
filed with the Securities and Exchange Commission (the
"Commission") under the Securities Act of 1933, as amended (the
"Act"), in the form heretofore delivered (excluding the exhibits
thereto but including the documents incorporated by reference in
the prospectus included therein) to such Agent, and such Initial
Registration Statement in such form has been declared effective
by the Commission and no stop order suspending its effectiveness
has been issued and no proceeding for that purpose has been
initiated or threatened by the Commission. A subsequent
registration statement on Form S-3 (Registration No. 333-
___________) (the "Subsequent Registration Statement") in respect
of an additional $150,000,000 aggregate principal amount of the
Securities has been filed with the Commission under the Act, in
the form heretofore delivered or to be delivered (excluding the
exhibits thereto but including the documents incorporated by
reference in the prospectus included therein) to such Agent, and
such Subsequent Registration Statement in such form has been
declared effective by the Commission and no stop order suspending
its effectiveness has been issued and no proceeding for that
purpose has been initiated or threatened by the Commission (any
preliminary prospectus included in the Subsequent Registration
Statement being hereinafter called a "Preliminary Prospectus").
The Initial Registration Statement and the Subsequent
Registration Statement, including all exhibits thereto but
excluding Forms T-1 and T-2, as amended at the time each became
effective, are hereinafter called the "Registration Statement";
the combined prospectus included as a part of the Subsequent
Registration Statement (including, if applicable, any prospectus
supplement) relating to the Securities, in the form in which it
most recently has been filed with the Commission on or prior to
the date of this Agreement, is hereinafter called the
"Prospectus"; any reference herein to any Preliminary Prospectus
or the Prospectus shall be deemed to refer to and include the
documents filed by the Company under the Securities Exchange Act
of 1934, as amended (the "Exchange Act"), and incorporated
therein by reference as of the date of such Preliminary
Prospectus or Prospectus; any reference to any amendment or
supplement to any Preliminary Prospectus or Prospectus, including
any supplement to the Prospectus that sets forth only the terms
of a particular issue of the Securities (a "Pricing Supplement"),
shall be deemed to refer to and include the documents filed by
the Company under the Exchange Act and incorporated therein by
reference as of the date of such amendment or Pricing Supplement;
and any reference to the Prospectus as amended or supplemented
shall be deemed to refer to and include the Prospectus as then
amended or supplemented (including the applicable Pricing
Supplement) in relation to a particular issue of Securities, in
the form filed with the Commission pursuant to Rule 424(b) under
the Act, including any documents filed by the Company under the
Exchange Act and incorporated therein by reference as of the date
of such amendment or supplement.
(c) The documents incorporated by reference in the
Prospectus, when filed with the Commission or, if later, when
they became effective, conformed in all material respects with
the requirements of the Act or the Exchange Act, as applicable,
and the applicable rules and regulations of the Commission there-
under; none of such documents when so filed or when such
documents became effective, as the case may be, included an
untrue statement of a material fact or omitted to state a
material fact required to be stated therein or necessary to make
the statements therein, in the light of the circumstances under
which they were made, not misleading; any future documents so
filed or incorporated by reference in the Prospectus, or any
amendment or supplement thereto, when filed with the Commission
or, if later, when effective, will conform in all material
respects with the applicable requirements of the Act or the
Exchange Act, as applicable, and the rules and regulations of the
Commission thereunder, and when such documents are filed or
become effective, as the case may be, they will not contain an
untrue statement of a material fact or omit to state a material
fact required to be stated therein or necessary to make the
statements therein, in the light of the circumstances under which
they were made, not misleading; provided, however, that the
-------- --------
Company makes no representations or warranties as to information
contained in or omitted from the Prospectus as amended or
supplemented in reliance upon and in conformity with information
furnished in writing to the Company by any Agent specifically for
use therein;
(d) The Initial Registration Statement and the Subsequent
Registration Statement when each became effective conformed, and
the Prospectus conforms, and any amendment or supplement thereto
will conform, in all material respects, with the provisions of
the Act and the Trust Indenture Act of 1939, as amended (the
"Trust Indenture Act"), and the rules and regulations of the
Commission thereunder; and the Initial Registration Statement and
the Subsequent Registration Statement when each became effective
did not, the Prospectus does not (and on each of the dates
referred to in clause (i) of Section 6 will not) and any
amendment or supplement to the Prospectus, as of its date and on
each of the dates referred to in clause (i) of Section 6, will
not, contain an untrue statement of a material fact or omit to
state a material fact required to be stated therein or necessary
to make the statements therein not misleading; provided, however,
-------- -------
that the Company makes no representations or warranties as to
information contained in or omitted from any such document in
reliance upon and in conformity with information furnished in
writing to the Company by any Agent specifically for use therein;
(e) Except as set forth in or contemplated by the
Prospectus, since the date as of which information is given in
the Prospectus (i) there has not been any material adverse change
in the condition of the Company and its subsidiaries taken as a
whole, financial or otherwise, (ii) there has not been any
transaction entered into by the Company or any of its
subsidiaries which is material to the Company and its
subsidiaries taken as a whole, other than transactions in the
ordinary course of business, and (iii) neither the Company nor
any of its subsidiaries has incurred any contingent obligation
which is material to the Company and its subsidiaries taken as a
whole;
(f) The Securities have been duly authorized, and, when
issued pursuant to their respective Indentures and delivered
pursuant to this Agreement and any Terms Agreement (as defined in
Section 3 hereof), will have been duly executed, authenticated,
issued and delivered, will constitute valid and legally binding
obligations of the Company, enforceable in accordance with their
terms, except as their enforceability may be limited by laws and
principles of equity relating to or affecting generally the
enforcement of creditors' rights, including without limitation,
bankruptcy and insolvency laws, and will be entitled to the
benefits provided by their respective Indentures (which will be
substantially in the form filed as exhibits to the Subsequent
Registration Statement); the Indentures have been duly authorized
and qualified under the Trust Indenture Act, constitute valid and
legally binding instruments, enforceable in accordance with their
terms, except as their enforceability may be limited by laws and
principles of equity relating to or affecting generally the
enforcement of creditors' rights, including without limitation,
bankruptcy and insolvency laws; and the Indentures conform, and
the Securities of each issue, when issued, will conform, in all
material respects, to the descriptions thereof in the Prospectus
as amended or supplemented with respect to such issue;
(g) The issue and sale of the Securities, the compliance by
the Company with all of the provisions of the Securities, the
Indentures, this Agreement and any Terms Agreement, and the
consummation by the Company of the transactions herein and
therein contemplated will not result in a breach or violation of
any of the terms or provisions of, or constitute a default under,
any indenture, mortgage, deed of trust, loan agreement or other
agreement or instrument to which the Company is a party or by
which the Company is bound or to which any of the property of the
Company is subject, nor will such action result in any violation
of the provisions of any statute or the Restated Articles of
Incorporation, as amended, or the Bylaws, as amended, of the
Company or any order, rule or regulation of any court or any
regulatory authority or other governmental agency or body having
jurisdiction over the Company or any of its properties; and no
consent, approval, authorization, order, registration or
qualification of or with any court or governmental agency or body
is required for the solicitation of offers to purchase Securities
and the issue and sale of the Securities or the consummation by
the Company of the other transactions contemplated by the
Indentures, this Agreement or any Terms Agreement, except such as
have been obtained at or prior to the Commencement Date (as
defined in Section 4 hereof), will have been obtained under the
Act, the Trust Indenture Act and the public utility laws of the
States of Oregon and Washington and such as may be required under
state securities or Blue Sky laws in connection with the
solicitation by such Agent of offers to purchase Securities from
the Company and with purchases of Securities by such Agent as
principal, as the case may be, in each case in the manner
contemplated hereby; provided, however, that further
authorization must be obtained by the Company under the public
utility laws of the States of Oregon and Washington prior to any
sale of any Security to an Agent, as principal; and
(h) Other than as set forth or contemplated in the
Prospectus, there are no legal or governmental proceedings
pending to which the Company is a party or to which any property
of the Company is subject, which, if determined adversely to the
Company, would individually or in the aggregate have a material
adverse effect on the consolidated financial position,
stockholders' equity or consolidated results of operations of the
Company, and, to the best of the Company's knowledge, no such
proceedings are threatened.
2. Obligations of the Agents and the Company.
-----------------------------------------
(a) Subject to the terms and conditions hereof and to the
reservation by the Company of the right to sell Securities
directly on its own behalf, the Company hereby (i) appoints each
of Merrill Lynch & Co., Merrill Lynch, Pierce Fenner & Smith
Incorporated and PaineWebber Incorporated as an agent of the
Company for the purpose of soliciting and receiving offers to
purchase Securities from the Company and (ii) reserves the right,
from time to time, to appoint additional agents for the purpose
of soliciting and receiving offers to purchase Securities from
the Company; provided that each such additional agent shall be
required to become a party to this Agreement and undertake the
obligations of an Agent hereunder pursuant to an Additional Agent
Appointment Agreement ("Additional Agent Appointment Agreement")
substantially in the form of Exhibit 1 hereto.
(b) On the basis of the representations and warranties
herein, and subject to the terms and conditions hereof, each of
the Agents, as agent of the Company, severally and not jointly,
agrees to use its reasonable best efforts to solicit and receive
offers to purchase particular issues of the Securities from the
Company upon the terms and conditions set forth in the Prospectus
as amended or supplemented with respect thereto. Each Agent will
promptly advise the Company by telephone or other appropriate
means of all reasonable offers to purchase Securities, other than
those rejected by such Agent. The Company shall not, without the
consent of each Agent, which consent shall not unreasonably be
withheld, solicit or accept offers to purchase, or sell, any debt
securities with a maturity, at the time of original issuance, of
from nine months to 30 years, except (i) pursuant to this
Agreement, (ii) pursuant to a private placement not constituting
a public offering under the Act, or (iii) in connection with a
firm commitment underwriting pursuant to an underwriting
agreement that does not provide for a continuous offering.
However, the Company, subject to Section 5(f) hereof, reserves
the right to sell, and may solicit and accept offers to purchase,
Securities directly on its own behalf, and, in the case of any
such sale not resulting from a solicitation made by an Agent, no
commission will be payable with respect to such sale.
(c) Procedural details relating to the issue and delivery
of Securities, the solicitation of offers to purchase Securities
and the payment therefor, unless an Agent and the Company shall
otherwise agree, shall be as set forth in the Administrative
Procedure attached hereto as Annex I (the "Administrative
Procedure"). The provisions of the Administrative Procedure
shall apply to all transactions contemplated hereunder other than
those made pursuant to a Terms Agreement. Each Agent and the
Company shall perform the respective duties and obligations
specifically provided to be performed by each of them in the
Administrative Procedure. The Company will furnish to the
Trustees a copy of the Administrative Procedure as from time to
time in effect.
(d) The Company reserves the right, in its sole discretion,
to instruct the Agents to suspend, at any time, for any period of
time or permanently, the solicitation of offers to purchase the
Securities. As soon as practicable, but in any event not later
than one business day after receipt of notice from the Company,
the Agents will suspend solicitation of offers to purchase
Securities from the Company until such time as the Company has
advised the Agents that such solicitation may be resumed.
(e) The Company agrees to pay each Agent a commission, at
the time of settlement (each a "Settlement Date") of any sale of
a Security by the Company as a result of a solicitation made by
such Agent, in an amount equal to the following applicable
percentage of the principal amount of such Security sold:
Commission
(percentage of
aggregate
principal amount
Range of Maturities of Securities sold)
------------------- -------------------
From 9 months to less than 1 year .125%
From 1 year to less than 18 months .150%
From 18 months to less than 2 years .200%
From 2 years to less than 3 years .250%
From 3 years to less than 4 years .350%
From 4 years to less than 5 years .450%
From 5 years to less than 6 years .500%
From 6 years to less than 7 years .550%
From 7 years to less than 10 years .600%
From 10 years to less than 15 years .625%
From 15 years to less than 20 years .675%
From 20 years to 30 years .750%
3. Sales to Agents as Principal.
----------------------------
Each sale of Securities to an Agent, as principal, shall be made in
accordance with the terms of this Agreement and (unless the Company
and such Agent shall otherwise agree) a separate agreement (each a
"Terms Agreement"), which will provide for the sale of such Securities
to, and the purchase thereof by, such Agent, as principal. A Terms
Agreement may be either (i) a written agreement substantially in the
form of Annex II hereto, or (ii) an oral agreement between either
Agent and the Company confirmed in writing by such Agent. A Terms
Agreement may also specify certain provisions relating to the
reoffering of such Securities by such Agent. Each Terms Agreement
shall specify the principal amount of Securities to be purchased by an
Agent pursuant thereto, the price to be paid to the Company for such
Securities, any provisions relating to the rights of, and defaults by,
any underwriters acting together with such Agent in the reoffering of
the Securities, the time and date of delivery of and payment for such
Securities (each, a "Time of Delivery") and place of delivery of such
Securities, and any requirements for opinions of counsel, accountants'
letters and officers' certificates pursuant to Section 5 hereof. Each
purchase of Securities, unless otherwise agreed shall be at a discount
equivalent to the commission payable to an Agent, acting as agent,
with respect to a sale of Securities of identical maturity, as set
forth in Section 2(e) hereof). The Agent may engage the services of
any other broker or dealer in connection with the resale of the
Securities purchased as principal and may allow any portion of the
discount received in connection with such purchase from the Company to
be paid to such brokers and dealers. The commitment of an Agent to
purchase Securities as principal, whether pursuant to a Terms
Agreement or otherwise, shall be deemed to have been made on the basis
of the representations and warranties of the Company herein contained
and, to the extent not otherwise agreed upon in a Terms Agreement or
otherwise, shall be subject to the terms and conditions herein set
forth.
4. Commencement.
------------
At 11:00 a.m., New York City time, on the date of this Agreement or at
such later date and time as may be agreed upon between the Agents and
the Company not later than the day prior to the earlier of the day on
which the solicitation of offers to purchase Securities is to begin or
on which any Terms Agreement shall be executed (such time and date
being referred to herein as the "Commencement Date"), the Agents shall
be furnished at the offices of Reid & Priest LLP, 40 West 57th Street,
New York, New York:
(a) An opinion of Simpson Thacher & Bartlett (a partnership
which includes professional corporations), counsel to the Agents,
dated the Commencement Date, with respect to such matters as such
Agents may reasonably request, which opinion may rely, as to all
matters governed by Oregon and Washington law, upon the opinion
of Bruce B. Samson, Esq., General Counsel for the Company,
referred to in Section 4(b) hereof;
(b) An opinion of Bruce B. Samson, Esq., dated the
Commencement Date, in form and substance reasonably satisfactory
to such Agents, to the effect set forth in Annex III, which
opinion may rely, as to all matters governed by New York law,
upon the opinion of Reid & Priest LLP referred to in Section 4(c)
hereof;
(c) An opinion of Reid & Priest LLP, dated the Commencement
Date, in form and substance reasonably satisfactory to such
Agents, to the effect set forth in Annex IV, which opinion may
rely, as to all matters governed by Oregon and Washington law,
upon the opinion of Bruce B. Samson, Esq., referred to in Section
4(b) hereof;
(d) A letter from the Company's independent accountants,
dated the Commencement Date, in form and substance reasonably
satisfactory to such Agents and subject to compliance with the
requirements of Statements on Auditing Standards issued by the
American Institute of Certified Public Accountants ("SAS"), to
the effect set forth in Annex V hereto; and
(e) A certificate of the President or any Vice President of
the Company, dated the Commencement Date, in form reasonably
satisfactory to such Agents, (i) as to the accuracy of the
representations and warranties of the Company herein at and as of
the Commencement Date, (ii) as to the performance by the Company
in all material respects of all of its obligations hereunder to
be performed at or prior to the Commencement Date, (iii) as to
the matters set forth in Section 1(e) hereof, (iv) as to the
absence of any stop order of the Commission suspending the
effectiveness of the Registration Statement or any pending or
contemplated proceedings for such purpose, (v) as to the full
force and effect of the authorizing orders of the Public Utility
Commission of Oregon and the Washington Utilities and
Transportation Commission referred to in Section 7(a) hereof, and
(vi) as to such other matters as such Agents may reasonably
request.
5. Covenants of the Company.
------------------------
The Company covenants and agrees with each Agent:
(a) (i) To make no amendment or supplement to the
Registration Statement or the Prospectus (other than a Pricing
Supplement) (A) prior to the Commencement Date, which any Agent
shall reasonably disapprove by notice to the Company promptly
after receipt of the proposed form thereof or (B) after the date
of any agreement by such Agent, pursuant to a Terms Agreement or
otherwise, to purchase Securities as principal and prior to the
related Time of Delivery which such Agent shall reasonably disap-
prove by notice to the Company promptly after receipt of the
proposed form thereof; (ii) to prepare, with respect to each
particular issue of Securities to be sold through or to such
Agent pursuant to this Agreement, a Terms Agreement or otherwise,
a Pricing Supplement with respect to such Securities in a form
reasonably satisfactory to such Agent and to file such Pricing
Supplement in accordance with Rule 424(b) under the Act; (iii) to
make no amendment or supplement to the Registration Statement or
Prospectus, other than a Pricing Supplement, without affording
such Agent a reasonable opportunity for review thereof and
comment thereon; (iv) to timely file all reports and any de-
finitive proxy or information statements required to be filed by
the Company with the Commission pursuant to Section 13(a), 13(c),
14 or 15(d) of the Exchange Act for so long as the delivery of a
prospectus is required in connection with the offering or sale of
the Securities, and during such same period to advise such Agent,
promptly after the Company receives notice thereof, of the time
when any amendment to the Registration Statement has been filed
or has become effective or any supplement to the Prospectus or
any amended Prospectus (other than any Pricing Supplement that
relates to Securities not purchased through or by such Agent) has
been filed with the Commission, of the issuance by the Commission
of any stop order or of any order preventing or suspending the
use of any prospectus relating to the Securities, of the suspen-
sion of the qualification of the Securities for offering or sale
in any jurisdiction, of the initiation or threatening of any
proceeding for any such purpose, or of any request by the
Commission for the amendment or supplement of the Registration
Statement or Prospectus or for additional information; (v) to
promptly make every reasonable effort to comply with all requests
of the Commission for additional information; and (vi) in the
event of the issuance of any such stop order or of any such order
preventing or suspending the use of any such prospectus or
suspending any such qualification, to use its best efforts to
obtain its withdrawal;
(b) From time-to-time, to take such action as such Agent
reasonably may request to qualify the Securities for offering and
sale under the securities laws of such jurisdictions as may be
approved by the Company and to comply with such laws so as to
permit the continuance of sales and dealings therein for as long
as may be necessary to complete the distribution or sale of the
Securities; provided, however, that in connection therewith the
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Company shall not be required to qualify as a foreign corporation
or to file a general consent to service of process in any juris-
diction, or to comply with any other requirement reasonably
deemed by the Company to be unduly burdensome;
(c) To furnish such Agent with copies of the Registration
Statement, each amendment thereto, the Prospectus and each
amendment or supplement thereto, other than any Pricing
Supplement (except as provided in the Administrative Procedure),
in the form in which it is filed with the Commission pursuant to
Rule 424(b) under the Act, and with copies of the documents
incorporated by reference therein (other than exhibits
incorporated by reference in the Registration Statement), each in
such quantities as such Agent may reasonably request from time-
to-time; and, if the delivery of a prospectus is required at any
time in connection with the offering or sale of the Securities to
or through an Agent pursuant to this Agreement and if, at such
time, any event shall have occurred as a result of which the
Prospectus as then amended or supplemented would include an
untrue statement of a material fact or omit to state any material
fact necessary in order to make the statements therein, in the
light of the circumstances under which they were made, not
misleading, or, if for any other reason it shall be necessary
during such period to amend or supplement the Prospectus or to
file under the Exchange Act any document incorporated by
reference in the Prospectus in order to comply with the Act, the
Exchange Act or the Trust Indenture Act, to notify such Agent and
request such Agent, in its capacity as agent of the Company, to
suspend solicitation of offers to purchase Securities from the
Company (and, if so notified, such Agent shall cease such
solicitations as soon as practicable, but in any event not later
than one business day later); and if the Company shall decide to
amend or supplement the Registration Statement or the Prospectus,
to so advise such Agent promptly by telephone (confirmed in
writing) and to prepare and cause to be filed promptly with the
Commission an amendment or supplement to the Registration
Statement or the Prospectus or to file any document incorporated
by reference in the Prospectus that will correct such statement
or omission or effect such compliance; provided that, (i) should
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such event relate solely to activities of any Agent (except any
termination of any Agent's services hereunder), such Agent shall
assume the expense of preparing and furnishing any such amendment
or supplement; (ii) if, during such period, such Agent shall
continue to own Securities purchased from the Company as
principal or such Agent otherwise shall be required to deliver a
prospectus in respect of transactions in the Securities, the
Company shall promptly prepare and file with the Commission such
an amendment or supplement; and (iii) if such Agent shall be
required to deliver a prospectus in connection with sales of any
Securities purchased by it as principal at any time nine months
or more after the date of such purchase and (A) there shall be,
as a result of such purchase, no Securities remaining to be sold
under the Registration Statement or (B) the Company, pursuant to
Section 2(d) hereof, shall have instructed the Agents, during
such nine month period, to suspend permanently the solicitation
of offers to purchase the Securities, such Agent shall assume the
expense of preparing and furnishing any such amendment or
supplement in connection with the sales of any Securities
purchased by such Agent as principal. (For the purposes of this
Section 5(c), the Company shall be entitled to assume that a Pro-
spectus shall no longer be required to be delivered under the Act
from and after the date six months from the date of the purchase
by an Agent as principal of the particular issuance of Securities
to which it relates, unless it shall have received notice from
such Agent to the contrary);
(d) To make generally available to its security holders as
soon as practicable, but in any event not later than eighteen
months after (i) the effective date of the Registration
Statement, (ii) the effective date of each post-effective
amendment to the Registration Statement, and (iii) the date of
each filing by the Company with the Commission of an Annual
Report on Form 10-K that is incorporated by reference in the
Registration Statement, an earning statement of the Company and
its subsidiaries (which need not be audited) in accordance with
Section 11(a) of the Act and the rules and regulations of the
Commission thereunder (including, at the option of the Company,
Rule 158);
(e) For the period ending five years from the date any
Securities are sold by the Company pursuant to an offer solicited
by such Agent under this Agreement, to furnish to such Agent
copies of all reports or other communications (financial or
other) furnished to stockholders, and deliver to such Agent (i)
as soon as they are available, copies of any reports and
financial statements furnished to or filed with the Commission
pursuant to Section 13(a), 13(c), 14 or 15(d) of the Exchange
Act, (ii) copies of all registration statements filed under the
Act (other than those in respect of shareholder or employee
plans), and (iii) such additional information concerning the
business and financial condition of the Company as such Agent may
from time to time reasonably request (such financial statements
to be on a consolidated basis to the extent the accounts of the
Company and its subsidiaries are consolidated in reports
furnished to its stockholders generally or to the Commission);
(f) That, from the date of any Terms Agreement or other
agreement with such Agent to purchase Securities as principal and
to and including the earlier of (i) the termination of the
trading restrictions for the Securities purchased thereunder, as
notified to the Company by such Agent and (ii) the related Time
of Delivery, the Company, without the prior written consent of
such Agent, will not offer, sell, contract to sell or otherwise
dispose of any debt securities of the Company in a public
offering which both have a maturity of from nine months to 30
years and are substantially similar to the Securities;
(g) That each acceptance by the Company of an offer to
purchase Securities procured by such Agent, as agent, and each
agreement by the Company, pursuant to a Terms Agreement or
otherwise, to sell Securities to such Agent, as principal, shall
be deemed to be an affirmation to such Agent that the
representations and warranties of the Company contained in or
made pursuant to this Agreement are true and correct as of the
date of such acceptance or agreement, as the case may be, as
though made as of such date, and an undertaking that such
representations and warranties will be true and correct as of the
Settlement Date for the Securities relating to such acceptance or
as of the Time of Delivery relating to such sale, as the case may
be, as though made as of such date (except that such repre-
sentations and warranties shall be deemed to relate to the
Registration Statement and the Prospectus as amended and
supplemented relating to such Securities);
(h) That, reasonably in advance of (i) each date as of
which an Agent reasonably requests an opinion or opinions of
Simpson Thacher & Bartlett, counsel to the Agents, or other
counsel to the Agents reasonably satisfactory to the Company, or
(ii) each time that the Company sells Securities to such Agent as
principal pursuant to a Terms Agreement or other agreement and
such Agent requests an opinion or opinions by Simpson Thacher &
Bartlett, counsel to the Agents, or other counsel to the Agents
reasonably satisfactory to the Company, the Company shall furnish
to such counsel such papers and information as they may
reasonably request to enable them to furnish to such Agent a
letter in form reasonably satisfactory to such Agent, to the
effect that such Agent may rely on the opinion of such counsel
referred to in Section 4(a) hereof, to the same extent as though
it was dated the date of such letter (except that the statements
in such opinion shall be deemed to relate to the Registration
Statement and the Prospectus as amended and supplemented to the
date of such letter), or in lieu of such a letter, an opinion of
the same tenor as the opinion of such counsel referred to in
Section 4(a) hereof, but modified to relate to the Registration
Statement and the Prospectus as amended and supplemented to such
date;
(i) That each time that (x) the Registration Statement or
the Prospectus shall be amended or supplemented (other than by a
Pricing Supplement or by an amendment or supplement providing
solely for a change in the interest rates of the Securities or
similar changes and, unless the Agents shall otherwise specify,
other than by an amendment or supplement which relates
exclusively to an offering of debt securities other than the
Securities), (y) a document incorporated by reference in the
Prospectus as amended or supplemented (other than a Current
Report on Form 8-K, unless the Agents shall otherwise specify)
shall be filed under the Act or Exchange Act (unless waived by
the Agents), and (z) the Company sells Securities to such Agent,
as principal, pursuant to a Terms Agreement or other agreement
and such Terms Agreement or other agreement specifies the
delivery of an opinion, letter or certificate under this Section
5(i) as a condition to the purchase of Securities pursuant to
such Terms Agreement or other agreement, the Company shall
furnish or cause to be furnished to such Agent:
(i) a letter from Bruce B. Samson, Esq., General Counsel
for the Company, or his successor, dated the date of
such amendment, supplement, incorporation or Time of
Delivery relating to such sale, as the case may be, in
form reasonably satisfactory to such Agent, to the
effect that such Agent may rely on the opinion of such
counsel referred to in Section 4(b) hereof to the same
extent as though it were dated the date of such letter
(except that the statements in such opinion shall be
deemed to relate to the Registration Statement and the
Prospectus as amended and supplemented to the date of
such letter, excluding all documents filed by the
Company under the Exchange Act and incorporated by
reference into the Registration Statement and
Prospectus during or prior to the fiscal year which is
the subject of the Company's most recent Annual Report
on Form 10-K) or, in lieu of such a letter, an opinion
of the same tenor as the opinion of such counsel
referred to in Section 4(b) hereof, but modified to
relate to the Registration Statement and the Prospectus
as so amended and supplemented to such date;
(ii) a letter of Reid & Priest LLP, New York, New York,
counsel for the Company, or other counsel for the
Company reasonably satisfactory to such Agent, dated
the date of such amendment, supplement, incorporation
or Time of Delivery relating to such sale, as the case
may be, in form reasonably satisfactory to such Agent,
to the effect that such Agent may rely on the opinion
of such counsel referred to in Section 4(c) hereof to
the same extent as though it were dated the date of
such letter (except that the statements in such opinion
shall be deemed to relate to the Registration Statement
and the Prospectus as amended and supplemented to the
date of such letter, excluding, in the case of the
statements in the paragraph next following paragraph 10
of such opinion, all documents filed by the Company
under the Exchange Act and incorporated by reference
into the Registration Statement and the Prospectus
during or prior to the fiscal year which is the subject
of the Company's most recent Annual Report on Form 10-
K) or, in lieu of such letter, an opinion of the same
tenor as the opinion of such counsel referred to in
Section 4(c) hereof, but modified to relate to the
Registration Statement and the Prospectus as so amended
and supplemented to such date; and
(iii) a certificate executed by the President or any Vice
President of the Company, dated the date of such
supplement, amendment, incorporation or Time of
Delivery relating to such sale, as the case may be, in
such form as shall be reasonably satisfactory to such
Agent, to the effect that the statements contained in
the certificate referred to in Section 4(e) hereof are
true and correct at such date as though made as of such
date (except that such statements shall be deemed to
relate to the Registration Statement and the Prospectus
as amended and supplemented to such date) or, in lieu
of such certificate, a certificate of the same tenor as
the certificate referred to in Section 4(e) hereof, but
modified to relate to the Registration Statement and
the Prospectus as amended and supplemented to such
date; and
(j) That each time that (x) the Registration Statement or
the Prospectus shall be amended or supplemented to include
additional financial information (unless waived by the Agents),
and (y) the Company sells Securities to such Agent as principal
pursuant to a Terms Agreement or other agreement and such Terms
Agreement or other agreement specifies the delivery of a letter
under this Section 5(j) as a condition to the purchase of
Securities pursuant to such Terms Agreement or other agreement,
and subject to compliance with the requirements of SAS issued by
the American Institute of Certified Public Accountants, the
Company shall furnish or cause to be furnished to such Agent a
letter of Deloitte & Touche LLP or other independent accountants
for the Company reasonably satisfactory to the Agent dated the
date of such amendment, supplement, incorporation or Time of
Delivery relating to such sale, as the case may be, in form
reasonably satisfactory to such Agent, to the effect that such
Agent may rely upon the letter of such accountants referred to in
Section 4(d) hereof to the same extent as though it were dated
the date of such subsequent letter (except the statements in such
former letter shall be deemed to relate to the financial
statements included or incorporated in the Registration Statement
and Prospectus as amended and supplemented to the date of such
latter letter), or, in lieu of such latter letter, a letter of
the same tenor as the letter referred to in Section 4(d) hereof,
but modified to relate to the Registration Statement and the
Prospectus as amended or supplemented to the date of such letter,
with such changes as may be necessary to reflect changes in the
financial statements and other information derived from the
accounting records of the Company, to the extent such financial
statements and other information are available as of a date not
more than five business days prior to the date of such letter;
(k) To offer to any person who has agreed to purchase
Securities as the result of an offer to purchase solicited by
such Agent, as agent, the right to refuse to purchase and pay for
such Securities if, at the Settlement Date for such Securities,
any condition set forth in Section 6 hereof shall not have been
satisfied (it being understood that the judgment of such person
with respect to the impracticability or inadvisability of such
purchase of Securities shall be substituted, for purposes of this
Section 5(k), for the judgment of such Agent with respect
thereto); and
(l) To pay or cause to be paid the following: (i) the fees
and expenses of the Company's counsel and accountants in
connection with the registration of the Securities under the Act
and all other expenses in connection with the preparation,
printing and filing of the Registration Statement, any
Preliminary Prospectus, the Prospectus and any Pricing Supple-
ments and all other amendments and supplements thereto and the
mailing and delivering of copies thereof to such Agent; (ii) the
fees and expenses of counsel for the Agents in connection with
the establishment of the program contemplated hereby, any
opinions to be rendered by such counsel hereunder and the
transactions contemplated hereunder; (iii) the cost of preparing
this Agreement, any Terms Agreement and any other documents
approved by the Company in connection with the offering,
purchase, sale and delivery of the Securities; (iv) the fees, not
to exceed $5,000, and expenses of counsel for the Agents in
connection with the qualification of the Securities for offering
and sale under state securities laws as provided in Section 5(b)
hereof and the preparation of any blue sky and legal investment
memoranda; (v) any fees charged by securities rating services for
rating the Securities; (vi) any filing fees incident to any
required review by the National Association of Securities
Dealers, Inc. of the terms of the sale of the Securities; (vii)
the cost of preparing the Securities; (viii) the fees and
expenses of the Trustees and any agent of any Trustee and any
transfer or paying agent of the Company and the fees and
disbursements of counsel for any Trustee or any such agent in
connection with any Indenture and the Securities; (ix) any
advertising expenses connected with the solicitation of offers to
purchase and the sale of Securities so long as such advertising
expenses have been approved by the Company; and (x) all other
costs and expenses incident to the performance of the Company's
obligations hereunder which are not otherwise specifically
provided for in this Section; provided, however, that, except as
provided in Sections 8 and 9 hereof, such Agent shall pay all
other expenses it incurs, including any expenses that may be
incurred by it or for its account pursuant to the proviso of
Section 5(c) hereof.
6. Conditions to Agents' Obligations. The obligation of an
---------------------------------
Agent, as agent of the Company, at any time (each a "Solicitation
Time"), to solicit offers to purchase the Securities and the
obligation of an Agent to purchase Securities as principal, pursuant
to a Terms Agreement or otherwise, shall be subject, in such Agent's
discretion, to the conditions that: (i) all of the representations
and warranties of the Company herein (and, in the case of an
obligation of an Agent under a Terms Agreement or other agreement with
an Agent to purchase Securities as principal, in or incorporated in
such agreement by reference) were true and correct (A) on the Com-
mencement Date; (B) each time that the Registration Statement or the
Prospectus shall be amended or supplemented, (C) each time a document
incorporated by reference in the Prospectus as amended or supplemented
shall be filed by the Company under the Act or Exchange Act, (D) at
the date of each acceptance by the Company of an offer to purchase
Securities procured by such Agent, as agent, and each agreement by the
Company, pursuant to a Terms Agreement or otherwise, to sell
Securities to an Agent, as principal, (E) at each Settlement Date, and
(F) at each Time of Delivery of Securities so to be purchased by such
Agent, as principal, as the case may be, (ii) prior to such Solicita-
tion Time or such Time of Delivery, as the case may be, the Company
shall have performed all of its obligations hereunder theretofore to
be performed, (iii) all requests for additional information on the
part of the Commission shall have been complied with to the reasonable
satisfaction of such Agent, (iv) there shall be in full force and
effect orders of the Public Utility Commission of Oregon and the
Washington Utilities and Transportation Commission which are
acceptable to the Agents and which permit the issuance and sale of the
Securities substantially in accordance with the terms and conditions
of this Agreement, (v) no stop order suspending the effectiveness of
the Registration Statement shall have been issued and no proceedings
for that purpose shall be pending before, or to the knowledge of the
Company contemplated by, the Commission, and (vi) there shall not have
occurred: (A) a suspension or material limitation of trading in
securities generally on the New York Stock Exchange; (B) a general
moratorium on commercial banking activities in New York declared by
either Federal or New York State authorities; (C) an engagement by the
United States in hostilities or any escalation of hostilities, the
effect of which, in the judgment of such Agent, makes it impracticable
or inadvisable to proceed with the solicitation of offers to purchase
Securities or the purchase of Securities from the Company as principal
on the terms and in the manner contemplated by this Agreement and, if
applicable, any Terms Agreement or other agreement; or (D) any down-
grading, or any notice shall have been given of any intended or
potential downgrading, of the Securities by either Moody's Investors
Service or Standard & Poor's Corporation. In addition to the
foregoing, the obligation of an Agent to purchase Securities as
principal, pursuant to a Terms Agreement or other agreement, shall be
subject, in such Agent's discretion, to the further condition that
there shall not have been, since the date of such Terms Agreement or
other agreement or since the respective dates as of which information
is given in the Registration Statement, any material adverse change in
the condition, financial or otherwise, or in the earnings, business
affairs or business prospects of the Company and its subsidiaries
considered as one enterprise, whether or not arising in the ordinary
course of business.
7. Conditions to Company's Obligations.
-----------------------------------
(a) The obligation of the Company to sell and deliver any
Security pursuant hereto, to a Terms Agreement or otherwise shall
be subject to the condition that, after the acceptance by the
Company of an offer to purchase such Security procured by an
Agent, as agent, or the agreement by the Company, pursuant to a
Terms Agreement or otherwise, to sell such Security to an Agent,
as principal, and prior to the Time of Delivery or the Settlement
Date, as the case may be, with respect to such purchase or sale,
neither the Public Utility Commission of Oregon nor the
Washington Utilities and Transportation Commission shall have
issued an order revoking its then existing order permitting the
issuance and sale of the Securities through each Agent, as agent,
on the terms set forth herein or to each Agent, as principal,
pursuant to a Terms Agreement or other agreement.
(b) If the condition specified in Section 7(a) hereof shall
not have been fulfilled, the obligation of the Company to sell
Securities hereunder or under a Terms Agreement or other
agreement may be terminated by the Company; and neither the
Company nor any Agent shall have any liability to the other,
except for (i) the obligation of the Company to pay certain
expenses to the extent provided for in Section 5(l) hereof, (ii)
the obligation of the Company to pay commissions and hold the
Agents harmless as provided in Section 9 hereof (and, for
purposes of said Section 9, such a failure of such condition to
be fulfilled shall be considered a default by the Company on its
obligation to deliver such Securities), and (iii) any liability
under Section 8 hereof.
8. Indemnification.
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(a) The Company will indemnify and hold harmless each Agent
against any losses, claims, damages or liabilities, joint or
several, to which such Agent may become subject, under the Act or
otherwise, insofar as such losses, claims, damages or liabilities
or actions in respect thereof arise out of or are based upon an
untrue statement or alleged untrue statement of a material fact
contained in the Registration Statement, any Preliminary
Prospectus, the Prospectus or the Prospectus as amended or
supplemented, or arise out of or are based upon the omission or
alleged omission to state therein a material fact required to be
stated therein or necessary to make the statements therein not
misleading, and will reimburse such Agent for any legal or other
expenses reasonably incurred by it, as incurred, in connection
with investigating or defending any such loss, claim, damage,
liability or action; provided, however, that the Company shall
not be liable in any such case to the extent that any such loss,
claim, damage or liability or action in respect thereof arises
out of or is based upon an untrue statement or alleged untrue
statement or omission or alleged omission made in the
Registration Statement, any Preliminary Prospectus, the
Prospectus or the Prospectus as amended or supplemented in reli-
ance upon and in conformity with written information furnished to
the Company by such Agent specifically for use therein; and
provided, further, that the indemnity agreement contained in this
Section 8(a) shall not inure to the benefit of any Agent on
account of any losses, claims, damages or liabilities or actions
in respect thereof arising solely from the sale of Securities by
or through such Agent pursuant to a Terms Agreement or otherwise
to any person if a copy of the Prospectus as then amended and
supplemented with respect to such Securities shall not have been
sent or given to such person with or prior to written
confirmation of the sale involved (assuming that the Company
shall have previously furnished such documents to such Agent in a
timely fashion), and if the Prospectus (as so amended or
supplemented) would have cured the defect giving rise to such
losses, claims, damages or liabilities.
(b) Each Agent will indemnify and hold harmless the Company
against any losses, claims, damages or liabilities to which the
Company may become subject, under the Act or otherwise, insofar
as such losses, claims, damages or liabilities or actions in
respect thereof arise out of or are based upon an untrue
statement or alleged untrue statement of a material fact
contained in the Registration Statement, any Preliminary
Prospectus, the Prospectus or the Prospectus as amended or
supplemented, or arise out of or are based upon the omission or
alleged omission to state therein a material fact required to be
stated therein or necessary to make the statements therein not
misleading, in each case to the extent, but only to the extent,
that such untrue statement or alleged untrue statement or
omission or alleged omission was made in the Registration
Statement, any Preliminary Prospectus, the Prospectus or the
Prospectus as amended or supplemented in reliance upon and in
conformity with written information furnished to the Company by
such Agent specifically for use therein, and will reimburse the
Company for any legal or other expenses incurred by the Company,
as incurred, in connection with investigating or defending any
such loss, claim, damage or liability or action.
(c) Promptly after receipt by an indemnified party under
Section 8(a) or Section 8(b) of notice of the commencement of any
action, such indemnified party shall, if a claim in respect
thereof is to be made against the indemnifying party under such
Section, notify the indemnifying party in writing of the
commencement thereof; but the omission so to notify the
indemnifying party shall not relieve it from any liability which
it may have to any indemnified party otherwise than under such
Section. In case any such action shall be brought against any
indemnified party and it shall notify the indemnifying party of
the commencement thereof, the indemnifying party shall be
entitled to participate therein and, to the extent that it shall
wish, jointly with any other indemnifying party similarly
notified, to assume the defense thereof, with counsel
satisfactory to such indemnified party (who shall not, except
with the consent of the indemnified party, be counsel to the
indemnifying party); provided, however, in no event shall such
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indemnifying parties be obligated to retain more than one counsel
(and necessary local counsel), in addition to counsel for such
indemnifying parties, to represent the indemnified parties, and
after notice from the indemnifying party to such indemnified
party of its election so to assume the defense thereof, the
indemnifying party shall not be liable to such indemnified party
under such Section for any legal expenses of other counsel or any
other expenses, in each case subsequently incurred by such
indemnified party, in connection with the defense thereof other
than reasonable costs of investigation. Each indemnified party
may also participate at its own expense in the defense of any
such action. No indemnifying party shall, without the prior
written consent of the indemnified party, effect any settlement
of any pending or threatened proceeding in respect of which any
indemnified party is or could have been a party and indemnity
could have been sought hereunder by such indemnified party,
unless such settlement includes an unconditional release of such
indemnified party from all liability on claims that are the
subject matter of such proceeding.
(d) If the indemnification provided for in Section 8(a) or
Section 8(b) hereof is unavailable to or insufficient to hold
harmless an indemnified party in respect of any losses, claims,
damages or liabilities (or actions in respect thereof) referred
to therein, then each indemnifying party shall contribute to the
amount paid or payable by such indemnified party as a result of
such losses, claims, damages or liabilities (or actions in
respect thereof) in such proportion as is appropriate to reflect
any relevant equitable considerations including the relative
fault of the Company on the one hand and each Agent on the other
in connection with the statements or omissions which resulted in
such losses, claims, damages or liabilities (or actions in
respect thereof), and relative benefit of the Company on the one
hand and each Agent on the other. Relative fault shall be
determined by reference to, among other things, whether the
untrue or alleged untrue statement of a material fact or the
omission or alleged omission to state a material fact required to
be stated therein or necessary in order to make the statements
therein not misleading relates to information supplied by the
Company on the one hand or by any Agent on the other and the
parties' relative intent, knowledge, access to information and
opportunity to correct or prevent such statement or omission.
The relative benefits received by the Company on the one hand and
each Agent on the other shall be deemed to be in the same
proportion as the total net proceeds from the sale of Securities
(before deducting expenses) received by the Company bear to the
total commissions or discounts received by such Agent in respect
thereof. The Company and each Agent agree that it would not be
just and equitable if contribution pursuant to this Section 8(d)
were determined (i) with respect only to any losses, claims,
damages or liabilities referred to in Section 8(a) hereof, by per
capita allocation (even if all Agents were treated as one entity
for such purpose) or (ii) by any method of allocation which does
not take account of the equitable considerations referred to
above in this Section 8(d). The amount paid or payable by an
indemnified party as a result of the losses, claims, damages or
liabilities (or actions in respect thereof) referred to above in
this Section 8(d) shall be deemed to include any legal or other
expenses reasonably incurred by such indemnified party in connec-
tion with investigating or defending any such action or claim.
No person guilty of fraudulent misrepresentation (within the
meaning of Section 11(f) of the Act) shall be entitled to
contribution from any person who was not guilty of such
fraudulent misrepresentation. The obligations of each of the
Agents under this Section 8(d) to contribute are several and are
not joint.
(e) The obligations of the Company under this Section 8
shall be in addition to any liability which the Company may
otherwise have and shall extend, upon the same terms and
conditions, to each person, if any, who controls any Agent within
the meaning of the Act. The obligations of each Agent under this
Section 8 shall be in addition to any liability which such Agent
may otherwise have and shall extend, upon the same terms and
conditions, to each director of the Company, to each officer of
the Company who has signed the Registration Statement and to each
person, if any, who controls the Company within the meaning of
the Act.
9. Nonperformance. Each Agent, in soliciting offers to
--------------
purchase Securities from the Company and in performing the other
obligations of such Agent hereunder (other than in respect of any
purchase by an Agent as principal pursuant to a Terms Agreement or
otherwise), is acting solely as agent for the Company and not as
principal. Each Agent will make reasonable efforts to assist the
Company in obtaining performance by each purchaser whose offer to
purchase Securities from the Company was solicited by such Agent and
has been accepted by the Company, but such Agent shall not have any
liability to the Company in the event such purchase is not consummated
for any reason. If the Company shall default on its obligation to
deliver Securities to a purchaser whose offer it has accepted, the
Company shall (i) hold each Agent harmless against any loss, claim or
damage arising from or as a result of such default by the Company and
(ii) notwithstanding such default, pay to the Agent that solicited
such offer any commission to which it would be entitled in connection
with such sale.
10. Survival of Agreement. The respective indemnities,
---------------------
agreements, representations, warranties and other statements by any
Agent and the Company set forth in or made pursuant to this Agreement
shall remain in full force and effect regardless of any investigation
(or any statement as to the results thereof) made by or on behalf of
any Agent or any controlling person of any Agent or the Company, or
any officer or director or any controlling person of the Company, and
shall survive each delivery of and payment for any of the Securities.
11. Suspension or Termination. The provisions of this
-------------------------
Agreement relating to the solicitation of offers to purchase
Securities from the Company may be suspended or terminated at any time
by the Company as to any Agent or by any Agent as to such Agent upon
the giving of written notice of such suspension or termination to such
Agent or the Company, as the case may be. In the event of such
suspension or termination with respect to any Agent, this Agreement
shall remain in full force and effect with respect to (i) any Agent as
to which such suspension or termination has not occurred, (ii) the
rights and obligations of any party which have previously accrued or
which relate to Securities which are already issued, agreed to be
issued or the subject of a pending offer at the time of such
suspension or termination, (iii) Sections 2(e), 5(d), 5(e), 5(l), 8, 9
and 10 hereof, and (iv) the obligations of the Company to amend or
supplement the Prospectus, so long as any Agent continues to hold
Securities as principal.
12. Notices. Except as otherwise specifically provided
-------
herein or in the Administrative Procedure, all statements, requests,
notices and advices hereunder shall be in writing or by telephone, if
promptly confirmed in writing, and if to Merrill Lynch & Co., Merrill
Lynch, Pierce, Fenner & Smith Incorporated, shall be sufficient in all
respects when delivered or sent by facsimile transmission or
registered mail to World Financial Center, North Tower, New York, New
York 10281, Facsimile Transmission No. 212-449-2234, Telephone No.
212-449-7476 and if to PaineWebber Incorporated, shall be sufficient
in all respects when delivered or sent by facsimile transmission or
registered mail to 1285 Avenue of the Americas, 11th Floor, New York,
New York 10019, Facsimile Transmission No. 212-247-0371, Attn: David
G. Zahka; if to the Company, shall be sufficient in all respects when
delivered or sent by facsimile transmission or registered mail to One
Pacific Square, 220 N.W. Second Avenue, Portland, Oregon 97209, Atten-
tion: Chief Financial Officer, with a copy to the General Counsel,
Facsimile Transmission No. 503-220-2584, Telephone No. 503-220-2406;
and if to any additional Agent, as set forth in the Additional Agent
Appointment Agreement relating to such Agent.
13. Benefit of Agreement. This Agreement, any Additional
--------------------
Agent Appointment Agreement and any Terms Agreement shall be binding
upon, and inure solely to the benefit of, each Agent a party hereto
and thereto and the Company, and to the extent provided in Section 8
and Section 10 hereof, the officers and directors of the Company and
any person who controls any Agent or the Company, and their respective
personal representatives, successors and assigns, and no other person
shall acquire or have any right under or by virtue of this Agreement,
any Additional Agent Appointment Agreement or any Terms Agreement. No
purchaser of any of the Securities through or from any Agent hereunder
shall be deemed a successor or assign by reason of such purchase.
14. Timing. Time shall be of the essence in this Agreement,
------
any Additional Agent Appointment Agreement and any Terms Agreement.
As used herein, the term "business day" shall mean any day when banks
in New York City are not authorized or obligated by law or executive
order to remain closed.
15. Governing Law. This Agreement, any Additional Agent
-------------
Appointment Agreement and any Terms Agreement shall be governed by and
construed in accordance with the laws of the State of New York.
16. Descriptive Headings. The descriptive headings of the
--------------------
several paragraphs of this Agreement are inserted for convenience only
and do not constitute a part of this Agreement.
17. Execution in Counterparts. This Agreement, any
-------------------------
Additional Agent Appointment Agreement and any Terms Agreement may be
executed by any one or more of the parties hereto and thereto in any
number of counterparts, each of which shall be an original, but all of
such respective counterparts shall together constitute one and the
same instrument.
If the foregoing is in accordance with your understanding,
please sign and return to us three counterparts hereof, whereupon this
letter and the acceptance by each of you hereof shall constitute a
binding agreement between the Company and each of you in accordance
with its terms.
Very truly yours,
NORTHWEST NATURAL GAS COMPANY
By: ______________________________
Senior Vice President,
Finance and Chief Financial
Officer
Accepted in New York, New York,
as of the date hereof:
MERRILL LYNCH, PIERCE, FENNER & SMITH INCORPORATED
By: __________________________
Title:
PAINEWEBBER INCORPORATED
By: _______________________________
Title:
<PAGE>
ANNEX I
Northwest Natural Gas Company
Administrative Procedure
------------------------
This Administrative Procedure relates to the Securities
defined in the Distribution Agreement, dated ___________, 1996 (the
"Distribution Agreement"), amongst Northwest Natural Gas Company (the
"Company"), on the one hand, and Merrill Lynch & Co., Merrill Lynch,
Pierce, Fenner & Smith Incorporated, PaineWebber Incorporated, and
each other person which shall become a party thereto (each, an "Agent"
and, together, the "Agents"), on the other. Defined terms used herein
and not defined herein shall have the meanings given such terms in the
Distribution Agreement or the Indentures. An Agent, in relation to a
purchase of a Security by a purchaser solicited by such Agent, is
referred to herein as the "Selling Agent" and, in relation to a
purchase of a Security by such Agent as principal other than pursuant
to a Terms Agreement, as the "Purchasing Agent". As used herein, the
term "business day" shall mean any day when banks in New York City are
not authorized or obligated by law or executive order to remain
closed.
The procedures to be followed with respect to the settlement
of sales of Securities directly by the Company to purchasers solicited
by an Agent, as agent, are set forth below. The terms and settlement
details related to a purchase of Securities by an Agent, as principal,
from the Company will be set forth in a Terms Agreement, pursuant to
the Distribution Agreement, unless the Company and such Agent
otherwise shall agree.
The Company will advise each Agent in writing of those
persons with whom such Agent is to communicate regarding offers to
purchase Securities and the related settlement details.
The order dated _________, 1996 of the Public Utility
Commission of Oregon (the "OPUC") provides, among other things, that
the authority contained therein is valid through _________, 199_, and
the order dated ________, 1996 of the Washington Utilities and
Transportation Commission (the "WUTC") provides that the Company is
authorized to issue and sell Securities not later than ________, 199_.
In addition, such orders of the OPUC and the WUTC authorize the
issuance and sale by the Company only of Securities bearing interest
at fixed rates, established within the maximum all-in spreads over
Benchmark Treasury Yields for various maturities (determined in
accordance with said orders as of the time the commitment to purchase
any Securities is received by the Company and the Agent).
As stated in the Company's Prospectus dated November __,
1996, if the terms of any Security, as determined by the Company,
provide that such Security will be redeemable at the option of the
company, such Security will be made redeemable in whole or in part.
Further authorization must be obtained under the public
utility laws of the States of Oregon and Washington prior to any sale
of any Security to any Agent, as principal.
Procedure for Rate Changes:
--------------------------
When a decision has been reached to change the interest rate
on or other variable terms with respect to any Securities being
offered for sale, the Company will promptly advise the Agents and the
Agents will forthwith suspend solicitation of offers to purchase such
Securities. The Agent will telephone the Company with recommendations
as to the changed interest rates or other variable terms. At such
time as the Company advises the Agents of the new interest rates or
other variable terms, the Agent may resume solicitation of offers to
purchase such Securities. Until such time only "indications of
interest" may be recorded.
Acceptance or Rejection of Offers by Company:
--------------------------------------------
Each Agent will promptly advise the Company by telephone or
other appropriate means of all reasonable offers to purchase
Securities, other than those rejected by such Agent. Each Agent, in
its discretion reasonably exercised, may reject any offer received by
it, in whole or in part. Each Agent also may make offers to the
Company to purchase Securities as a Purchasing Agent. The Company, in
its sole discretion, may accept any offer to purchase Securities and
may reject any such offer, in whole or in part.
The Company will promptly notify the Selling Agent or
Purchasing Agent, as the case may be, of its acceptance or rejection
of an offer to purchase Securities. If the Company accepts an offer
to purchase Securities, it will confirm such acceptance in writing to
the Selling Agent or Purchasing Agent, as the case may be.
The order dated _________, 1996 of the OPUC requires that,
for each issuance of Securities, the Company seek and report to the
OPUC at least one other bid quote in addition to the bid that is
accepted.
Settlement:
----------
The receipt of immediately available funds by the Company in
payment for a Security and the authentication and delivery of such
Security will, with respect to such Security, constitute "Settlement."
All offers solicited by a Selling Agent or made by a
Purchasing Agent and accepted by the Company will be settled on a date
(the "Settlement Date") which shall be the third business day after
the date of acceptance of such offer, unless the Company and the
purchaser shall agree to settle (a) on any other business day after
the acceptance of such offer or (b) with respect to an offer accepted
by the Company prior to 10:00 a.m., New York City time, on the date of
such acceptance.
Settlement Procedures:
---------------------
A. After the acceptance of an offer by the Company, the Selling
Agent or Purchasing Agent, as the case may be, will communicate the
following details of the terms of such offer (the "Sale Information")
to the Company by telephone (confirmed in writing) or by facsimile
transmission or other acceptable written means:
(1) Principal amount of Securities to be purchased;
(2) Issue Price ("Issue Price" shall mean (i) in the case of a
sale in which an Agent shall act as a Selling Agent, the
price to the purchaser or (ii) in the case of a sale to an
Agent as Purchasing Agent, that Purchasing Agent's
reoffering price);
(3) Selling Agent's commission or, if applicable, Purchasing
Agent's discount (spread between the reoffering price and
Purchasing Agent's purchase price);
(4) Net proceeds to the Company: (2) minus (3);
(5) Method of and specified funds for payment of purchase price:
(6) (a) Fixed rate Securities: interest rate;
(b) Floating rate Securities:
(i) interest rate basis
(ii) initial interest rate
(iii) spread or spread multiplier, if any
(iv) interest rate reset dates
(v) interest rate reset period
(vi) interest payment dates
(vii) initial interest payment date
(viii) interest payment period
(ix) regular record dates
(x) index maturity
(xi) calculation agent
(xii) maximum and minimum interest rates, if any
(xiii) calculation date
(xiv) interest determination dates;
(7) (a) Trade Date;
(b) Interest Commencement Date (Settlement Date unless
otherwise noted; "Issue Date" on Secured Notes);
Time of delivery;
(8) Closing location;
(9) Maturity date;
(10) If redeemable at the Company's option:
(a) initial redemption date;
(b) redemption limitation date;
(c) each redemption price and period;
(11) Sinking fund or other retirement provisions;
(12) The name of the Selling Agent or Purchasing Agent, as the
case may be;
(13) Exact name, address and taxpayer identification number of
party to be the registered owner;
(14) Party to whom Securities are to be delivered;
(15) Denominations of certificates to be delivered at settlement;
(16) The name of the Company's bank and the account number for
payment of the purchase price;
(17) Whether the Securities to be purchased are Secured Notes or
Unsecured Notes;
(a) Any other significant terms of the Securities or their offer
or sale.
B. After receiving such settlement information from the Agent,
the Company will advise the Trustee of the above settlement
information. The Company will prepare a Pricing Supplement to the
Prospectus and deliver copies to the Agent and will cause the Trustee
to issue, authenticate and deliver Securities.
If an identical Pricing Supplement has not been Previously
filed with the Securities and Exchange Commission (the "SEC"), the
Company will arrange to have transmitted promptly via EDGAR one copy
of the Pricing Supplement (with the appropriate paragraph under Rule
424(b) and the Registration No. inscribed in the upper right corner)
to the SEC, within the applicable time period provided in Rule 424(b).
One copy of the Pricing Supplement (with a copy of the cover letter
sent to the SEC if a filing with the SEC is required) will be sent by
facsimile to the Agents as soon as practicable but in no event later
than 12:00 noon on the day after the Trade Date at each of the
following numbers:
Merrill Lynch & Co. - Tritech Services
40 Colonial Drive
Piscataway, NJ 08854
Attn: Final Prospectus Unit/Nachman Kimerling
Facsimile No. (908) 885-2774/2775/2776;
Phone No. (908) 865-2768
and
Merrill Lynch & Co.
Merrill Lynch, Pierce, Fenner & Smith
Incorporated
Merrill Lynch World Headquarters
World Financial Center, North Tower
10th Floor
New York, NY 10281-1310
Attn: MTN Product Management
Facsimile No. (212) 449-2234; Phone No. (212) 449-7476
and
PaineWebber Incorporated
1285 Avenue of the Americas
11th Floor
New York, NY 10019
Attn: Corporate Bond Department
Facsimile No. (212) 247-0371; Phone No. (212) 713-2960
The Company shall supply the Agents as soon as practicable
but in no event later than the Settlement Date with an adequate supply
of Prospectuses and Pricing Supplements at the above addresses.
In addition, the Company will make any filings with the
OPUC and WUTC.
Suspension of Solicitation; Amendment or Settlement:
---------------------------------------------------
Subject to its representations, warranties and covenants
contained in the Distribution Agreement, the Company may instruct the
Agents to suspend solicitation of purchases at any time. Upon receipt
of such instructions, the Agents will forthwith suspend solicitation
of offers to purchase from the Company until such time as the Company
has advised them that solicitation of offers to purchase may be
resumed. If the Company decides to amend or supplement the Prospectus
(other than to change interest rates or other variable terms with
respect to the offering of the Securities), it will promptly advise
the Agents and will furnish the Agents and their counsel with copies
of the proposed amendment or supplement.
In the event that at the time the solicitation of offers to
purchase from the Company is suspended (other than to change interest
rates or other variable terms) there shall be any orders outstanding
which have not been settled, the Company will promptly advise the
Agents and the Trustee whether such orders may be settled and whether
copies of the Prospectus as theretofore amended and/or supplemented as
in effect at the time of the suspension may be delivered in connection
with the settlement of such orders. The Company will have the sole
responsibility for such decision and for any arrangements which may be
made in the event that the Company determines that such orders may not
be settled or that copies of such Prospectus may not be so delivered.
Delivery of Confirmation and Prospectus to Purchaser by Selling
---------------------------------------------------------------
Agent:
-----
The Selling Agent will deliver to the purchaser of a
Security a written confirmation of the sale and delivery and Payment
instructions. In addition, the Selling Agent will deliver to such
purchaser or its agent the Prospectus as amended or supplemented
(including the Pricing Supplement) relating to such Security prior to
delivery to such purchaser or its agent of, or together with, the
earlier to be delivered of (a) the confirmation of sale or (b) the
Security.
Instruction from Company to Trustee for Preparation of Securities:
-----------------------------------------------------------------
After receiving the Sale Information from the Selling Agent
or Purchasing Agent, as the case may be, the Company will communicate
such Sale Information to the Mortgage Trustee or the Indenture
Trustee, as the case may be, by telephone (confirmed in writing, by
facsimile transmission or by other acceptable written means).
The Company will instruct such Trustee by telephone
(confirmed in writing, by facsimile transmission or by other
acceptable written means) to authenticate and deliver the Securities
no later than 2:15 p.m., New York City time, on the Settlement Date.
Such instruction will be given by the Company prior to 3:00 p.m., New
York City time, on the business day prior to the Settlement Date,
unless the Settlement Date is the date of acceptance by the Company of
the offer to purchase Securities, in which case such instruction will
be given by the Company to the Trustee by 10:00 a.m., New York City
time, on the Settlement Date.
Procedures for Book-Entry Securities:
------------------------------------
In connection with Securities issued in book-entry form and
maintained in the book-entry system of The Depository Trust Company
("DTC"), (i) the Company and the Trustee shall act in accordance with
the letters of representation (relating to the Secured Notes and the
Unsecured Notes, respectively) from the Company and the Trustee to
DTC, as the same may be amended, supplemented or otherwise modified
from time to time, and (ii) the Trustee shall act in accordance with
one or more Medium-Term Note Certificate Agreements, relating to the
Securities, between the Trustee and DTC, as the same may be amended,
supplemented or otherwise modified from time to time, and in
accordance with its obligations as a participant in DTC.
The beneficial owner of a Security issued in book-entry form
(or one or more indirect participants in DTC designated by such owner)
will designate one or more participants in DTC (with respect to such
Security issued in book-entry form, the "Participants") to act as
agent for such beneficial owner in connection with the book-entry
system maintained by DTC, and DTC will record in book-entry form, in
accordance with instructions provided by such Participants, a credit
balance with respect to such Security issued in book-entry form in the
account of such Participants. The ownership interest of such
beneficial owner in such Security issued in book-entry form will be
recorded through the records of such Participants or through the
separate records of such Participants and one or more indirect
participants in DTC.
Transfers of a Book-Entry Security will be accomplished by
book entries made by DTC and, in turn, by Participants (and in certain
cases, one or more indirect participants in DTC) acting on behalf of
beneficial transferors and transferees of such Book-Entry Security.
Beneficial interests in the Securities may be purchased,
owned and transferred only in denominations of $1,000 or any integral
multiple of $1,000.
Preparation and Delivery of Securities by Trustee and Receipt of
--------------------------------------------------------------------
Payment Therefor:
-----------------
Certificated Securities
-----------------------
The Company will instruct the Mortgage Trustee or the
Indenture Trustee, as the case may be, to:
(i) Prepare each Security and appropriate receipts that
will serve as the documentary control of the
transaction.
(ii) In the case of a sale of Securities to a purchaser
solicited by a Selling Agent, by 2:15 p.m., New York
City time, on the Settlement Date, deliver the
Securities to such Selling Agent, at the address listed
below, for the benefit of the purchaser of such
Securities against delivery by such Selling Agent of a
receipt therefor. (On the Settlement Date, such
Selling Agent will deliver payment for such Securities
in immediately available funds to the Company's account
at a bank designated by the Company and included as a
part of the Sale Information provided by the Selling
Agent in an amount equal to the net proceeds to the
Company; provided that the Selling Agent reserves the
right to withhold payment for which it shall not have
received funds from the purchaser.)
(iii) In the case of a sale of Securities to a Purchasing
Agent, by 2:15 p.m., New York City time, on the
Settlement Date, deliver the Securities to such
Purchasing Agent, at the address listed below, against
delivery of payment therefor. (On the Settlement Date,
such Purchasing Agent will deliver payment for such
Securities in immediately available funds to the
Company's account at a bank designated by the Company
and included as a part of the Sale Information provided
by the Purchasing Agent in an amount equal to the net
proceeds to the Company.)
(iv) Complete the 4-ply Security and deliver three copies
thereof as follows:
1. Security with Agent's customer confirmation.
2. Copy 1 - for Trustee.
3. Copy 2 - for Agent.
4. Copy 3 - for Company.
(v) With respect to each sale, deliver the Securities and
Copies 1 and 2 thereof to the appropriate Agent at the
following address:
Merrill Lynch & Co.
Merrill Lynch, Pierce, Fenner & Smith
Incorporated
55 Water Street
Third Floor Level, N.S.C.C. Window
New York, New York 10041
Attn: Al Mitchell
or
PaineWebber Incorporated,
1285 Avenue of the Americas
11th Floor
New York, New York 10019
Attn: Corporate Bond Department
as the case may be, or to any other Agent as directed
by such Agent. (The Agent will acknowledge receipt of
the Security, will keep Copy 2 and will return Copy 1
to the Trustee. Delivery of the Security by the Trustee
will be made only against such acknowledgment of
receipt. Prior to the first settlement date, the
Trustee or the Company shall have sent a letter to
Merrill Lynch Clearance Operations, PaineWebber
Incorporated or any other Agent, as the case may be,
containing standard wire instructions for the net
proceeds of each Security, addressed as follows:
Merrill Lynch, Pierce, Fenner & Smith Incorporated
World Financial Center
North Tower
New York, New York 10281
or
PaineWebber Incorporated
1285 Avenue of the Americas
11th Floor
New York, New York 10019
Attn: Corporate Bond Department
as the case may be, or as directed by such other
Agent.)
(vi) Send Copy 3 to the Company.
Book-Entry Securities
---------------------
A. The Company will assign a CUSIP number to the Book-Entry
Security representing such Security and then advise the Trustee by
electronic transmission of the Sale Information received from the
Agent, such CUSIP number and the name of such Agent.
B. The Trustee will communicate to DTC and the Agent through
DTC's Participant Terminal System, a pending deposit message
specifying the following settlement information:
(1) The following Sale Information with respect to each
Security:
(a) Taxpayer identification number of the purchaser.
(b) Principal amount of the Security.
(c) Interest rate.
(d) Floating Rate Securities:
(i) interest rate basis;
(ii) initial interest rate;
(iii) spread or spread multiplier, if any;
(iv) interest rate reset dates;
(v) interest rate reset period;
(vi) interest payment dates;
(vii) interest payment period;
(viii) regular record dates;
(ix) index maturity;
(x) calculation agent;
(xi) maximum and minimum interest rates, if any;
(xii) calculation date; and
(xiii) interest determination dates.
(e) Issue price.
(f) Trade date.
(g) Interest Commencement Date, which shall be the
Settlement Date unless otherwise noted ("Issue Date" on
Secured Notes).
(h) Maturity date.
(i) Net proceeds to the Company.
(j) Agent's commission.
(k) Redemption provisions, if any.
(2) Identification numbers of the participant accounts
maintained by DTC on behalf of the Trustee and the Agent.
(3) Identification as a Fixed Rate Book-Entry Security or
Floating Rate Book-Entry Security.
(4) Initial Interest Payment Date for such Security, number of
days by which such date succeeds the related record date for
DTC purposes (or, in the case of Floating Rate Securities
which reset daily or weekly, the date five calendar days
preceding the Interest Payment Date) and, if then
calculable, the amount of interest payable on such Interest
Payment Date (which amount shall have been confirmed by the
Trustee).
(5) CUSIP number of the Book-Entry Security representing such
Security.
(6) Whether such Book-Entry Security represents any other
Securities issued or to be issued in book-entry form.
C. The Company will complete and deliver to the Trustee a
Book-Entry Security representing such Security in a form that has been
approved by the Company, the Agents and the Trustee.
D. The Trustee will authenticate the Book-Entry Security
representing such Security.
E. DTC will credit such Security to the participant account of
the Trustee maintained by DTC.
F. The Trustee will enter a Same-Day Funds Settlement System
("SDFS") deliver order through DTC's Participant Terminal System
instructing DTC (i) to debit such Security to the Trustee's
participant account and credit such Security to the participant
account, maintained by DTC, of the Agent which presented to the
Company the offer to purchase such Security which was accepted by the
Company (the "Presenting Agent") and (ii) to debit the settlement
account of the Presenting Agent and credit the settlement account of
the Trustee maintained by DTC, in an amount equal to the price of such
Security less such Agent's commission.
G. The Presenting Agent will enter an SDFS deliver order
through DTC's Participant Terminal System instructing DTC (i) to debit
such Security to the Presenting Agent's participant account and credit
such Security to the participant account of the Participants
maintained by DTC and (ii) to debit the settlement accounts of such
Participants and credit the settlement account of the Presenting Agent
maintained by DTC, in an amount equal to the initial public offering
price of such Security.
H. Transfer of funds in accordance with SDFS deliver orders
described in Settlement Procedures F and G will be settled in
accordance with SDFS operating procedures in effect on the Settlement
Date.
I. The Trustee will credit to an account of the Company
maintained at the Trustee funds available for immediate use in the
amount transferred to the Trustee in accordance with Settlement
Procedure F.
J. The Trustee will send a copy of the Book-Entry Security by
first class mail to the Company together with a statement setting
forth the principal amount of Securities Outstanding as of the related
Settlement Date after giving effect to such transaction and all other
offers to purchase Securities of which the Company has advised the
Trustee but which have not yet been settled.
K. The Agent will confirm the purchase of such Security to the
purchaser either by transmitting to the Participant with respect to
such Security a confirmation order through DTC's Participant Terminal
System or by mailing a written confirmation to such purchaser.
L. Settlement Procedures Timetable:
(1) For orders of Securities accepted by the Company,
Settlement Procedures A through K shall be completed as
soon as possible but not later than the respective
times (New York City time) set forth below:
Settlement
Procedure Time
--------- ----
A 11:00 a.m. on the trade date
B 2:00 p.m. on the trade date
C 3:00 p.m. on the Business
Day before Settlement Date
D 9:00 a.m. on Settlement
Date
E 10:00 a.m. on Settlement
Date
F-G No later than 2:00 p.m. on
Settlement Date
H 4:45 p.m. on Settlement
Date
I-K 5:00 p.m. on Settlement
Date
(2) If a sale is to be settled more than one Business Day after
sale date, Settlement Procedures A and B may, if necessary,
be completed at any time prior to the specified times on the
first Business Day after such sale date. In connection with
a sale which is to be settled more than one Business Day
after the trade date, if the initial interest rate for a
Floating Rate Security is not known at the time that the
Sale Information is given by the Presenting Agent to the
Company, Settlement Procedures A and B shall be completed as
soon as such rates have been determined, but no later than
11:00 a.m. and 2:00 p.m., New York City time, respectively,
on the second Business Day before the Settlement Date.
Settlement Procedure H is subject to extension in accordance
with any extension of Fedwire closing deadlines and in the
other events specified in the SDFS operating procedures in
effect on the Settlement Date.
(3) If settlement of a Security issued in book-entry form is
rescheduled or canceled, the Trustee will deliver to DTC,
through DTC's Participant Terminal System, a cancellation
message of such effect by no later than 2:00 p.m., New York
City time, on the Business Day immediately preceding the
scheduled Settlement Date.
Failure of Purchaser to Pay Selling Agent:
-----------------------------------------
Certificated Securities
-----------------------
If a purchaser shall fail to make payment to the Selling
Agent for any Security, the net proceeds to the Company which,
theretofore, shall have been paid by the Selling Agent to the Company,
the Selling Agent will promptly notify the Mortgage Trustee or the
Indenture Trustee, as the case may be, and the Company of such failure
by telephone, promptly confirmed in writing or by facsimile
transmission or by other acceptable written means. The Selling Agent
promptly will return such Security to such Trustee. Promptly upon
receipt of such Security by such Trustee, the Company will return to
the Selling Agent an amount equal to the amount previously paid to the
Company in respect of such Security. Such Trustee will cancel any
Security in respect of which such a failure shall occur, make
appropriate entries in its records and, unless otherwise instructed by
the Company, destroy such Security.
Book-Entry Securities
---------------------
If the Trustee fails to enter an SDFS deliver order with
respect to a Book-Entry Security issued in book-entry form pursuant to
paragraph F above, the Trustee may deliver to DTC, through DTC's
Participant Terminal System, as soon as practicable a withdrawal
message instructing DTC to debit such Security to the participant
account of the Trustee maintained at DTC. DTC will process the
withdrawal message, provided that such participant account contains a
principal amount of the Book-Entry Security representing such Security
that is at least equal to the principal amount to be debited. If
withdrawal messages are processed with respect to all the Securities
represented by a Book-Entry Security, the Trustee will mark such
Book-Entry Security "canceled", make appropriate entries in its
records and send such canceled Book-Entry Security to the Company.
The CUSIP number assigned to such Book-Entry Security shall, in
accordance with CUSIP Service Bureau procedures, be canceled and not
immediately reassigned. If withdrawal messages are processed with
respect to a portion of the Securities represented by a Book-Entry
Security, the Trustee will exchange such Book-Entry Security for two
Book-Entry Securities, one of which shall represent the Book-Entry
Securities for which withdrawal messages are processed and shall be
canceled immediately after issuance, and the other of which shall
represent the other Securities previously represented by the
surrendered Book-Entry Security and shall bear the CUSIP number of the
surrendered Book-Entry Security.
If the purchase price for any Book-Entry Security is not
timely paid to the Participants with respect to such Security by the
beneficial purchaser thereof (or a person, including an indirect
participant in DTC acting on behalf of such purchaser), such
Participants and, in turn, the related Agent may enter SDFS deliver
orders through DTC's Participant Terminal System reversing the orders
entered pursuant to paragraphs F and G above, respectively.
Thereafter, the Trustee will deliver the withdrawal message and take
the related actions described in the preceding paragraph. If such
failure shall have occurred for any reason other than default by the
applicable Agent to perform its obligations hereunder or under the
Distribution Agreement, the Company will reimburse such Agent on an
equitable basis for its loss of the use of funds during the period
when the funds were credited to the account of the Company.
Notwithstanding the foregoing, upon any failure to settle
with respect to a Book-Entry Security, DTC may take any actions in
accordance with its SDFS operating procedures then in effect. In the
event of a failure to settle with respect to a Security that was to
have been represented by a Book-Entry Security also representing other
Securities, the Trustee will provide, in accordance with paragraphs C
and D above, for the authentication and issuance of a Book-Entry
Security representing such remaining Securities and will make
appropriate entries in its records.
<PAGE>
ANNEX II
Northwest Natural Gas Company
Medium-Term Notes
Terms Agreement
---------------
[Merrill Lynch & Co.
Merrill Lynch, Pierce, Fenner & Smith
Incorporated
World Financial Center
North Tower
New York, New York 10281]
[PaineWebber Incorporated
1285 Avenue of the Americas
New York, New York 10019]
[Name of additional Agents, if any]
Dear Sirs:
Subject to the terms and conditions set forth herein and, to
the extent provided below, in the Distribution Agreement, dated
_________, 1996 (the "Distribution Agreement"), amongst Northwest
Natural Gas Company (the "Company"), on the one hand, and Merrill
Lynch & Co., Merrill Lynch, Pierce, Fenner & Smith Incorporated,
PaineWebber Incorporated and each other person which shall become a
party to the Distribution Agreement (each an "Agent" and, together,
the "Agents"), on the other, the Company proposes to issue and sell to
[Merrill Lynch & Co., Merrill Lynch, Pierce, Fenner & Smith
Incorporated] [PaineWebber Incorporated] [Name of other Agent] the
Securities (as defined in the Distribution Agreement) specified in the
Schedule hereto (the "Purchased Securities"), at the time, place and
purchase price and upon the terms and conditions set forth in such
Schedule. Each of the provisions of the Distribution Agreement not
specifically related to the solicitation by the Agents, as agents of
the Company, of offers to purchase Securities is incorporated herein
by reference, and shall be deemed to be part of this Terms Agreement
to the same extent as if such provisions had been set forth herein.
Each of the representations and warranties set forth in the
Distribution Agreement shall be deemed to have been made by the
Company at and as of the date of this Terms Agreement, except that
each such representation and warranty which makes reference to the
Prospectus shall be deemed to be a representation and warranty as of
the date of the Distribution Agreement in relation to the Prospectus
(as therein defined), and also a representation and warranty as of the
date of this Terms Agreement in relation to the Prospectus as amended
and supplemented with respect to the Purchased Securities.
A supplement to the Prospectus relating to the Purchased
Securities, in the form heretofore delivered to and approved by you,
is now proposed to be filed with the Commission in accordance with
Rule 424(b) under the Act.
Subject to the terms and conditions set forth herein and to
those of the Distribution Agreement incorporated herein by reference,
the Company agrees to issue and sell to [Merrill Lynch & Co., Merrill
Lynch, Pierce, Fenner & Smith Incorporated] [PaineWebber Incorporated]
[Name of other Agent] and [Merrill Lynch & Co., Merrill Lynch, Pierce,
Fenner & Smith Incorporated] [PaineWebber Incorporated] [Name of other
Agent] agrees to purchase from the Company the Purchased Securities,
at the time and place, in the principal amount and at the purchase
price set forth in the Schedule hereto.
If the foregoing is in accordance with your understanding,
please sign and return to us three counterparts hereof, whereupon this
letter, including those provisions of the Distribution Agreement
incorporated herein by reference, shall constitute a binding agreement
between you and the Company.
NORTHWEST NATURAL GAS COMPANY
By:___________________________________
Title:
Accepted in New York, New York,
as of the date hereof:
[MERRILL LYNCH, PIERCE, FENNER & SMITH INCORPORATED
By:__________________________________________
Title: ]
[PAINEWEBBER INCORPORATED
By:__________________________________________
Title: ]
[Name of other Agent, if any]
<PAGE>
Schedule to Annex II
Title of Purchased Securities:
-----------------------------
Aggregate Principal Amount: $
--------------------------
Price to Public:
---------------
Purchase Price by [Merrill Lynch & Co., Merrill Lynch, Pierce, Fenner
& Smith
-----------------
Incorporated] [PaineWebber Incorporated] [Name of other Agent]:
% of the principal amount of the Purchased Securities [,
plus accrued interest from to ] [and accrued
amortization of discount from to ]
Method of and Specified Funds for Payment of Purchase Price:
-----------------------------------------------------------
[By certified or official bank check or checks, payable to
the order of the Company, in [[New York Clearing House] [immediately
available] funds]
[By wire transfer to a bank account specified by the Company
in [next day] [immediately available] funds]
Indenture: [Mortgage] [Note Indenture]
---------
Interest Commencement Date which shall be the Settlement Date unless
--------------------------------------------------------------------
otherwise noted ("Issue Date" on Secured Notes):
-----------------------------------------------
Time of Delivery:
----------------
Closing Location:
----------------
Stated Maturity Date:
--------------------
Interest Rate or Rates (or Method of Determining Interest):
----------------------------------------------------------
Interest Payment Dates: [months and dates]
----------------------
Initial Interest Payment Date:
-----------------------------
Regular Record Dates:
--------------------
Redeemable at Company's Option: Yes ___ No ___
------------------------------
In Whole: Yes___ No___
In Part: Yes___ No___
Initial Redemption Date:
-----------------------
Redemption Limitation Date:
--------------------------
Initial Redemption Price:
------------------------
Reduction Percentage:
--------------------
Sinking Fund or Other Retirement Provisions, if any:
---------------------------------------------------
Documents to be Delivered as a Condition to the Closing:
-------------------------------------------------------
[(1) The opinion of counsel to the Agents referred to in Section
4(a)]
[(2) The opinion of counsel to the Company referred to in Section
4(b)]
[(3) The opinion of counsel to the Company referred to in Section
4(c)]
[(4) The accountants letter referred to in Section 4(d)]
[(5) The officers certificate referred to in Section 4(e)]
Other Provisions (including Syndicate Provisions,
-------------------------------------------------
if applicable):
--------------
<PAGE>
ANNEX III
___________, 1996
Merrill Lynch & Co.
Merrill Lynch, Pierce, Fenner
& Smith Incorporated
World Financial Center
North Tower
New York, New York 10281
PaineWebber Incorporated
1285 Avenue of the Americas
New York, New York 10019
Dear Sirs:
With reference to the issuance and sale from time-to-time by
Northwest Natural Gas Company (the "Company"), pursuant to the
Distribution Agreement, dated ____________, 1996 (the "Agreement"),
between the Company and each of you, of not to exceed $165,000,000 in
aggregate principal amount of (i) the Company's First Mortgage Bonds,
designated Secured Medium-Term Notes, Series B (the "Secured Notes")
to be issued under the Company's Mortgage and Deed of Trust, dated as
of July 1, 1946, to Bankers Trust Company (the "Corporate Trustee")
and R.G. Page (Stanley Burg, successor), as trustees, as supplemented
by twenty supplemental indentures (such Mortgage and Deed of Trust, as
so supplemented, being hereinafter called the "Mortgage"), and (ii)
the Company's Unsecured Medium-Term Notes, Series B (the "Unsecured
Notes"), to be issued under the Company's Indenture, dated as of June
1, 1991 (the "Indenture"), to Bankers Trust Company, as trustee (the
"Indenture Trustee") (the Secured Notes and the Unsecured Notes being
hereinafter collectively referred to as the "Notes"), and the
appointment of each of you as agents of the Company pursuant to the
Agreement for the purposes of soliciting and receiving offers to
purchase Notes, as agents, and purchasing Notes, as principals, from
the Company, please be advised that, as General Counsel of the
Company, I have participated in the preparation of or reviewed (a) the
Restated Articles of Incorporation, as amended, and Bylaws, as
amended, of the Company; (b) the Mortgage; (c) the Indenture; (d) the
Agreement; (e) the registration statement (File No. 33-64014) (the
"Initial Registration Statement"), filed by the Company with the
Securities and Exchange Commission (the "SEC") for the registration
under the Securities Act of 1933, as amended (the "1933 Act"), of
$150,000,000 of the Notes, of which $15,000,000 remain unsold, and for
the qualification under the Trust Indenture Act of 1939, as amended
(the "Trust Indenture Act"), of the Mortgage and the Indenture, which
Initial Registration Statement became effective on June 17, 1993; (f)
the registration statement (File No. 333-_______) (the "Subsequent
Registration Statement"), filed by the Company with the SEC for the
registration under the 1933 Act of an additional $150,000,000 of the
Notes, and for the qualification under the Trust Indenture Act of the
Mortgage and the Indenture, which Subsequent Registration Statement
became effective on __________, 1996; (g) the combined prospectus
relating to the Notes constituting a part of the Subsequent
Registration Statement in the form in which it became effective, or if
amended or supplemented subsequent to such effectiveness, as so
amended and supplemented, including the documents incorporated therein
by reference pursuant to Item 12 of Form S-3 (the "Prospectus"); (h)
the proceedings before the Public Utility Commission of Oregon and the
Washington Utilities and Transportation Commission relating to the
issuance and sale of the Notes; and (i) the records of various
corporate and other proceedings relating to the authorization,
issuance and sale of the Notes. I have also examined such other
documents and satisfied myself as to such other matters as I have
deemed necessary in order to render this opinion. I have not examined
the Notes, except specimens thereof.
In preparation of this opinion, I have examined originals or
photostatic certified copies of such certificates, agreements,
documents and other papers, and have made such inquiries and
investigations of law, as I deemed appropriate and necessary for the
opinion hereinafter set forth. In my examination, I have assumed the
authenticity of all documents submitted to me as certified or
photostatic copies and the authenticity of the originals of such
latter documents. As to certain matters of fact material to the
opinion expressed herein, I have relied upon certificates of various
corporate officers of the Company and public officials. I assume the
accuracy of the material and factual matters contained therein.
I am of the opinion that:
1. The Company is a validly organized and existing
corporation in good standing under the laws of the State of
Oregon, is qualified to do business and is in good standing in
the State of Washington, and has power (corporate and other) to
own its properties and conduct its business as described in the
Prospectus.
2. The Company holds valid and subsisting franchises,
licenses, permits and consents, free from burdensome restrictions
and adequate for the conduct of its business, as and to the
extent set forth in the Prospectus.
3. The Agreement has been duly and validly authorized,
executed and delivered by the Company.
4. The Mortgage and the Indenture have been duly and
validly authorized by all necessary corporate action, have been
duly and validly executed and delivered, and are valid and
binding instruments enforceable in accordance with their terms,
subject, as to enforcement, to laws and principles of equity
relating to or affecting generally the enforcement of creditors
rights, including, without limitation, bankruptcy and insolvency.
5. The Company has good and sufficient title to all the
properties described in, and as subject to the lien of, the
Mortgage and now owned by it, subject only to excepted
encumbrances as defined in the Mortgage and to minor defects and
irregularities customarily found in properties of like size and
character, which, in my opinion, do not materially impair the use
of the property affected thereby in the operation of the business
of the Company; the description in the Mortgage of such
properties is adequate to constitute the Mortgage a lien thereon;
and the Mortgage constitutes a valid, direct first mortgage lien
on such properties, which include substantially all of the
permanent physical properties and franchises of the Company
(other than those expressly excepted), subject only to the
exceptions enumerated above in this paragraph.
6. The form of the Secured Notes has been duly authorized
and has been established in conformity with the provisions of the
Mortgage; the form of the Unsecured Notes bearing interest at a
fixed rate, has been duly authorized and has been established in
conformity with the provisions of the Indenture; and the form of
the Unsecured Notes, bearing interest at a variable rate or not
bearing interest, when set forth in a Company Order or Orders or
established by procedures acceptable to the Indenture Trustee
specified in a Company Order or Orders, will have been duly
authorized and will have been established in conformity with the
provisions of the Indenture.
7. The Secured Notes have been duly authorized by the
resolutions adopted by the Board of Directors on May 27, 1993,
and September 26, 1996 (the "Board Resolutions"), and when the
terms of the Secured Notes shall have been determined as
contemplated by and in accordance with the Mortgage, the Board
Resolutions and written orders or instructions evidencing
determinations by Officers of the Company, such terms will have
been duly authorized by the Company and will have been
established in conformity with the terms of the Mortgage.
8. The Unsecured Notes have been duly authorized by the
Board Resolutions, and when the terms of the Unsecured Notes
shall have been determined as contemplated by and in accordance
with the Indenture, the Board Resolutions and, to the extent
required by the Indenture and the Board Resolutions, by Officers'
Certificates, Company Orders (each, as defined in the Indenture)
and procedures acceptable to the Indenture Trustee specified in
such Company Orders, such terms will have been duly authorized by
the Company and will have been established in conformity with the
terms of the Indenture.
9. The Notes, when (a) executed by the Company, (b)
completed, authenticated and delivered by the Corporate Trustee
or the Indenture Trustee, as the case may be, (c) issued and
delivered by the Company and (d) paid for, all as contemplated by
and in accordance with the Mortgage, in the case of Secured
Notes, the Indenture, in the case of Unsecured Notes, the Board
Resolutions, and (to the extent required by the Mortgage or the
Indenture and the Board Resolutions) Officers' Certificates,
Company Orders, procedures acceptable to the Indenture Trustee
specified in such Company Orders, written orders or instructions
evidencing determinations by the officers of the Company, the
Agreement, the Administrative Procedure (as defined in the
Agreement), and Terms Agreements (as defined in the Agreement),
if any, will be duly issued under the Mortgage or the Indenture,
as the case may be, and will constitute valid and legally binding
obligations of the Company, entitled to the benefits provided by
the Mortgage or the Indenture, as the case may be, and
enforceable in accordance with their terms, subject, as to
enforcement, to laws and principles of equity relating to or
affecting generally the enforcement of creditors' rights,
including, without limitation, bankruptcy and insolvency, and, in
the case of the Secured Notes, entitled to the benefit of the
security afforded by the Mortgage; provided, however, that
further authorization must be obtained by the Company under the
public utility laws of the States of Oregon and Washington prior
to any sale of any Note by the Company to either of you, as
principal.
10. The issuance and sale of the Notes, the compliance by
the Company with all of the provisions of the Notes, the
Mortgage, the Indenture and the Agreement and the consummation of
the transactions contemplated by the Agreement will not result in
a breach or violation of any of the terms and provisions of, or
constitute a default under, any statute, any indenture, mortgage,
deed of trust or other agreement or instrument known to me to
which the Company is a party or by which it is bound or to which
any of the property of the Company is subject, the Company's
Restated Articles of Incorporation, as amended, or Bylaws, as
amended, or any order, rule or regulation known to me of any
court or governmental agency or body having jurisdiction over
the Company or any of its properties; provided, however, that
further authorization must be obtained by the Company under the
public utility laws of the States of Oregon and Washington prior
to any sale of any Note by the Company to either of you, as
principal.
11. The Public Utility Commission of Oregon and the
Washington Utilities and Transportation Commission have issued
orders authorizing the issuance and sale by the Company of the
Notes; and no further approval, authorization, consent or other
order of any public board or body (other than in connection or in
compliance with the provisions of the securities or blue sky laws
of any jurisdiction) is legally required for the issuance and
sale of the Notes through each of you, as agent, on the terms and
conditions set forth in the Agreement.
12. The statements of Oregon, Washington and Federal law
(other than the 1933 Act, the Securities Exchange Act of 1934 and
the Trust Indenture Act), and legal conclusions based thereon,
contained in, or in the documents incorporated by reference in,
the Prospectus have been reviewed by me and are correct (except
to the extent that any statement contained in a document
incorporated or deemed to be incorporated by reference in the
Prospectus may be deemed to be modified or superseded in the
Prospectus or in any other subsequently filed document which also
is or is deemed to be incorporated by reference in the
Prospectus).
13. Except as described in the Prospectus, there are no
pending material legal or governmental proceedings and, to my
knowledge, no material threatened legal or governmental
proceedings, to which the Company is a party or of which any of
the property of the Company is subject, other than ordinary
routine litigation incidental to the kind of business conducted
by the Company.
In the course of the preparation by the Company of the
Initial and the Subsequent Registration Statements and the Prospectus,
I had conferences with certain officers and employees of the Company,
but I have made no independent verification of the accuracy or
completeness of the representations and statements made to me by such
person or the information included by the Company in either of such
Registration Statements and the Prospectus, and take no responsibility
therefor, except as forth in paragraph 12 hereof. However, my
examination of such Registration Statements and the Prospectus and my
discussions in the above-mentioned conferences did not disclose to me
any information which gives me reason to believe that, when each of
the Initial and Subsequent Registration Statements became effective,
it contained an untrue statement of a material fact or omitted to
state a material fact required to be stated therein or necessary to
make the statements therein not misleading, or that, as of the date of
this opinion, the Prospectus includes an untrue statement of a
material fact or omits to state a material fact necessary in order to
make the statements therein, in the light of the circumstances under
which they were made, not misleading; provided, that I do not express
any belief as to the financial statements or other financial or
statistical data contained in such Registration Statements or the
Prospectus, or as to the Forms T-1 or T-2, or as to any information
contained therein furnished to the Company in writing by any of you
expressly for use therein.
I am a member of the bar of the States of Oregon and
Washington and do not hold myself out as an expert on the laws of the
State of New York or Federal securities laws. Accordingly, in
rendering this opinion, I have relied, with your consent, as to all
matters governed by the laws of the State of New York, the 1933 Act,
the Securities Exchange Act of 1934 and the Trust Indenture Act, upon
the opinion of even date herewith addressed to you by Reid & Priest
LLP, New York, New York, counsel for the Company. I have read such
opinion and concur in the conclusions expressed therein insofar as
such conclusions involve questions of Oregon and Washington law.
You, the Trustees and, as to matters governed by the laws of
the State of Oregon and the State of Washington, Reid & Priest LLP and
your counsel may rely upon this opinion in connection with the
issuance and sale of the Notes. Neither you nor any of them may rely
upon this opinion for any other purpose, and no other person may rely
upon this opinion for any purpose without, in each case, my prior
written consent.
Very truly yours,
Bruce B. Samson, Esq.
<PAGE>
A N N E X I V
___________, 1996
Merrill Lynch & Co.
Merrill Lynch, Pierce, Fenner
& Smith Incorporated
World Financial Center
North Tower
New York, New York 10281
PaineWebber Incorporated
1285 Avenue of the Americas
New York, New York 10019
Dear Sirs:
With reference to the issuance and sale from time-to-time by
Northwest Natural Gas Company (the "Company"), pursuant to the
Distribution Agreement, dated ____________, 1996 (the "Agreement"),
between the Company and each of you, of not to exceed $165,000,000 in
aggregate principal amount of (i) the Company's First Mortgage Bonds,
designated Secured Medium-Term Notes, Series B (the "Secured Notes"),
to be issued under the Company's Mortgage and Deed of Trust, dated as
of July 1, 1946, to Bankers Trust Company (the "Corporate Trustee")
and R.G. Page (Stanley Burg, successor), as trustees, as supplemented
by twenty supplemental indentures (such Mortgage and Deed of Trust, as
so supplemented, being hereinafter called the "Mortgage"), and (ii)
the Company's Unsecured Medium-Term Notes, Series B (the "Unsecured
Notes"), to be issued under the Company's Indenture, dated as of June
1, 1991 (the "Indenture"), to Bankers Trust Company, as trustee (the
"Indenture Trustee") (the Secured Notes and the Unsecured Notes being
hereinafter collectively referred to as the "Notes"), and the
appointment of each of you as agents of the Company pursuant to the
Agreement for the purposes of soliciting and receiving offers to
purchase Notes, as agents, and purchasing Notes, as principals, from
the Company, please be advised that, as counsel to the Company, we
have participated in the preparation of or reviewed (a) the Restated
Articles of Incorporation, as amended, and Bylaws, as amended, of the
Company; (b) the Mortgage; (c) the Indenture; (d) the Agreement; (e)
the registration statement (File No. 33-64014) (the "Initial
Registration Statement"), filed by the Company with the Securities and
Exchange Commission (the "SEC") for the registration under the
Securities Act of 1933, as amended (the "1933 Act"), of $150,000,000
of the Notes, of which $15,000,000 remain unsold, and for the
qualification under the Trust Indenture Act of 1939, as amended (the
"Trust Indenture Act"), of the Mortgage and the Indenture, which
Initial Registration Statement became effective on June 17, 1993; (f)
the registration statement (File No. 333-_______) (the "Subsequent
Registration Statement"), filed by the Company with the SEC for the
registration under the 1933 Act of an additional $150,000,000 of the
Notes, and for the qualification under the Trust Indenture Act of the
Mortgage and the Indenture, which Subsequent Registration Statement
became effective on ___________, 1996; (g) the combined prospectus
relating to the Notes constituting a part of the Subsequent
Registration Statement in the form in which it became effective, or if
amended or supplemented subsequent to such effectiveness, as so
amended or supplemented, including the documents incorporated therein
by reference pursuant to Item 12 of Form S-3 (the "Prospectus"); (h)
the records of the proceedings before the Public Utility Commission of
Oregon and the Washington Utilities and Transportation Commission
relating to the issuance and sale of the Notes; and (i) the records of
various corporate and other proceedings relating to the authorization,
issuance and sale of the Notes. We have also examined such other
documents and satisfied ourselves as to such other matters as we have
deemed necessary in order to render this opinion. We have not
examined the Notes, except specimens thereof.
In the preparation of this opinion, we have examined
originals or photostatic or certified copies of such certificates,
agreements, documents and other papers, and have made such inquiries
and investigations of law, as we deemed appropriate and necessary for
the opinion hereinafter set forth. In our examination, we have
assumed the authenticity of all documents submitted to us as
originals, the conformity to original documents of all documents
submitted to us as certified or photostatic copies and the
authenticity of the originals of such latter documents. As to certain
matters of fact material to the opinion expressed herein, we have
relied upon certificates of various corporate officers of the Company
and public officials. We assume the accuracy of the material and
factual matters contained therein.
We are of the opinion that:
1. The Company is a validly organized and existing
corporation in good standing under the laws of the State Of Oregon,
and is qualified to do business and is in good standing in the State
of Washington.
2. The Agreement has been duly and validly authorized,
executed and delivered by the Company.
3. The Mortgage and the Indenture have been duly and
validly authorized by all necessary corporate action, have been duly
and validly executed and delivered, have been duly qualified under the
Trust Indenture Act, and are valid and binding instruments enforceable
in accordance with their terms, subject, as to enforcement, to laws
and principles of equity relating to or affecting generally the
enforcement of creditors' rights, including, without limitation,
bankruptcy and insolvency.
4. The form of the Secured Notes has been duly authorized
and has been established in conformity with the provisions of the
Mortgage and conforms to the description thereof contained in the
Prospectus; the form of the Unsecured Notes, bearing interest at a
fixed rate, has been duly authorized and has been established in
conformity with the provisions of the Indenture and conforms to the
description thereof contained in the Prospectus; and the form of the
Unsecured Notes, bearing interest at a variable rate or not bearing
interest, when set forth in a Company Order or Orders or established
by procedures acceptable to the Indenture Trustee specified in a
Company Order or Orders, will have been duly authorized and will have
been established in conformity with the provisions of the Indenture.
5. The Secured Notes have been duly authorized by the
resolutions adopted by the Board of Directors on May 27, 1993, and
September 26, 1996 (the "Board Resolutions"), and when the terms of
the Secured Notes shall have been determined as contemplated by and in
accordance with the Mortgage, the Board Resolutions and written orders
or instructions evidencing determinations by Officers of the Company,
such terms will have been duly authorized by the Company and will have
been established in conformity with the terms of the Mortgage.
6. The Unsecured Notes have been duly authorized by the
Board Resolutions, and when the terms of the Unsecured Notes shall
have been determined as contemplated by and in accordance with the
Indenture, the Board Resolutions and, to the extent required by the
Indenture and the Board Resolutions, by Officers' Certificates,
Company Orders (each, as defined in the Indenture) and procedures
acceptable to the Indenture Trustee specified in such Company Orders,
such terms will have been duly authorized by the Company and will have
been established in conformity with the terms of the Indenture.
7. The Notes, when (a) executed by the Company, (b)
completed, authenticated and delivered by the Corporate Trustee or the
Indenture Trustee, as the case may be, (c) issued and delivered by the
Company and (d) paid for, all as contemplated by and in accordance
with the Mortgage, in the case of the Secured Notes, the Indenture, in
the case of Unsecured Notes, the Board Resolutions, and (to the extent
required by the Mortgage or the Indenture and the Board Resolutions)
Officers' Certificates, Company Orders, procedures acceptable to the
Indenture Trustee specified in such Company Orders, written orders or
instructions evidencing determinations by the officers of the Company,
the Agreement, the Administrative Procedure (as defined in the
Agreement) and Terms Agreements (as defined in the Agreement), if any,
will be duly issued under the Mortgage or the Indenture, as the case
may be, and will constitute valid and legally binding obligations of
the Company, entitled to the benefits provided by the Mortgage or the
Indenture, as the case may be, and enforceable in accordance with
their terms, subject, as to enforcement, to laws and principles of
equity relating to or affecting generally the enforcement of
creditors' rights, including, without limitation, bankruptcy and
insolvency, and, in the case of the Secured Notes, entitled to the
benefit of the security afforded by the Mortgage; provided, however,
that further authorization must be obtained by the Company under the
public utility laws of the States of Oregon and Washington prior to
any sale of any Note by the Company to either of you, as principal.
8. The issuance and sale of the Notes, the compliance by
the Company with all of the provisions of the Notes, the Mortgage, the
Indenture and the Agreement and the consummation of the transactions
contemplated by the Agreement will not result in a breach or violation
of any of the terms and provisions of, or constitute a default under,
the Mortgage and the Indenture or the Company's Restated Articles of
Incorporation, as amended, or Bylaws, as amended.
9. The Public Utility Commission of Oregon and the
Washington Utilities and Transportation Commission have issued orders
authorizing the issuance and sale by the Company of the Notes; and no
further approval, authorization, consent or other order of any public
board or body (other than in connection or in compliance with the
provisions of the securities or blue sky laws of any jurisdiction) is
legally required for the issuance and sale of the Notes through each
of you, as agent, on the terms and conditions set forth in the
Agreement.
10. Both the Initial and Subsequent Registration Statements
have become effective under the Act, and, to the best of our
knowledge, no stop order suspending the effectiveness thereof has been
issued and no proceedings for that purpose are pending before or have
been proposed by the SEC; the Mortgage and the Indenture have been
duly qualified under the Trust Indenture Act; each of the Initial and
Subsequent Registration Statements at the time it became effective
complied, and the Prospectus (excluding the documents incorporated
therein by reference) as of the date of this opinion complies, as to
form, in all material respects with the requirements of the Act, the
Trust Indenture Act (except with respect to the Forms T-1 and Form T-
2, upon which we do not pass) and the rules and regulations of the SEC
thereunder; and the documents incorporated by reference in the
Prospectus pursuant to Item 12 of Form S-3 (other than the financial
statements and other financial or statistical data contained therein,
upon which we express no opinion), as of their respective dates of
filing, complied as to form in all material respects with the
requirements of the Securities Exchange Act of 1934, as amended (the
"Exchange Act"), and the rules and regulations of the SEC thereunder.
In the course of the preparation by the Company of the
Initial and the Subsequent Registration Statements and the Prospectus,
we had conferences with certain officers and employees of the Company,
with the General Counsel for the Company and with you and your
counsel, but we made no independent verification of the accuracy or
completeness of the representations and statements made to us by such
persons or the information included by the Company in either of such
Registration Statements and the Prospectus and take no responsibility
therefor, except insofar as set forth in paragraph 4 hereof. In
passing upon the forms of such Registration Statements and the
Prospectus we have, therefore, assumed the accuracy and completeness
of such representations, statements and information, except as
aforesaid. However, our examination of such Registration Statements
and the Prospectus and our discussions in the above-mentioned
conferences did not disclose to us any information which gives us
reason to believe that, when each of the Initial and the Subsequent
Registration Statements became effective, it contained an untrue
statement of a material fact or omitted to state a material fact
required to be stated therein or necessary to make the statements
therein not misleading, or that, as of the date of this opinion, the
Prospectus includes an untrue statement of a material fact or omits to
state a material fact necessary in order to make the statements
therein, in the light of the circumstances under which they were made,
not misleading; provided, that we do not express any belief as to the
financial statements or other financial or statistical data contained
in such Registration Statements or the Prospectus, or as to the Forms
T-1 or T-2, or as to any information contained therein furnished to
the Company in writing by any of you expressly for use therein.
We are members of the bar of the State of New York and do
not hold ourselves out as experts on the laws of the State of Oregon
or the State of Washington. Accordingly, in rendering this opinion, we
have relied, with your consent, as to all matters governed by the laws
of the State of Oregon and the State of Washington (including titles
to property and franchises and the lien of the Mortgage, upon which we
do not pass), upon the opinion of even date herewith addressed to you
by Bruce B. Samson, Esq., General Counsel of the Company. We have
read such opinion, which is in form satisfactory to us, and concur in
the conclusions expressed therein insofar as such conclusions involve
questions of the laws of the State of New York, the 1933 Act, the
Exchange Act and the Trust Indenture Act.
You, the Trustees, and as to matters governed by the laws of
the State of New York and the 1933 Act, the Exchange Act and the Trust
Indenture Act, Bruce B. Samson, Esq., may rely upon this opinion in
connection with the issuance and sale of the Notes. Neither you nor
any of them may rely upon this opinion for any other purpose, and no
other person may rely upon this opinion for any purpose without, in
each case, our prior written consent.
Very truly yours,
REID & PRIEST LLP
<PAGE>
ANNEX V
[Contents of Letter of Deloitte & Touche LLP]
The letter of Deloitte & Touche LLP will state in effect
that:
1. They are independent public accountants with respect to
the Company within the meaning of the Act and the applicable published
Rules and Regulations;
2. In their opinion, the financial statements examined by
them and incorporated by reference in the Registration Statement
comply as to form in all material respects with the applicable
accounting requirements of the Exchange Act and the published rules
and regulations thereunder;
3. On the basis of limited procedures, not constituting an
examination made in accordance with generally accepted auditing
standards, including a reading of the latest available interim
financial statements of the Company, if any, a reading of the minute
books of the Company since December 31, 19__, inquiries of officials
of the Company responsible for financial and accounting matters and
such other inquiries and procedures as may be specified in such
letter, nothing came to their attention that caused them to believe
that:
(a)(1) the latest interim consolidated financial
statements included or incorporated by reference in the
Registration Statement do not comply as to form in all material
respects with the applicable accounting requirements of the
Exchange Act and the published rules and regulations thereunder
as they apply to Form 10-Q or (2) said interim consolidated
financial statements are not in conformity with generally
accepted accounting principles applied on a basis substantially
consistent with that of the audited consolidated financial
statements incorporated by reference in the Registration
Statement;
(b) at the date of the latest available interim
balance sheet of the Company and at a subsequent specified date
not more than five days prior to the Time of Delivery, there has
been any change in the capital stock (except for (I) shares of
the Company's Common Stock issued under the Company's Dividend
Reinvestment Plan, 1985 Stock Option Plan or Employee Stock
Purchase Plan, (II) shares of Common Stock issued upon the
conversion of shares of the Company's Convertible Debentures, and
(III) shares of Preferred Stock purchased or redeemed pursuant to
or in anticipation of sinking and purchase funds with respect to
the Company's Preferred Stock) or any increase in the long-term
debt of the Company, or any decrease in net assets, in each case
as compared with amounts shown in the balance sheet as of the
date of the latest financial statements incorporated by reference
in the Registration Statement, except in each case for changes,
increases or decreases which the Registration Statement discloses
have occurred or may occur, which were occasioned by the
declaration of dividends or which are described in such letter;
or
(c) for the 12-month period for which the latest
unaudited financial statements are available, there were any
decreases, as compared with the latest 12-month period for which
financial statements are incorporated by reference in the
Prospectus, in operating revenues, net income and earnings
available for common stock, except in each case for decreases
which the Registration Statement discloses have occurred or may
occur, which were occasioned by the declaration of dividends or
which are described in such letter; and
4. They have performed certain other specified procedures
with respect to certain amounts and percentages set forth in the
Registration Statement or in the documents incorporated by reference
therein, as have been requested by your counsel and approved by the
Company, and have found them to be in agreement with the records of
the Company and the computations to be arithmetically correct.
<PAGE>
EXHIBIT 1
NORTHWEST NATURAL GAS COMPANY
$165,000,000
MEDIUM-TERM NOTES, SERIES B
________, 199_
Merrill Lynch & Co.
Merrill Lynch, Pierce, Fenner & Smith
Incorporated
World Financial Center
North Tower
New York, New York 10281
PaineWebber Incorporated
1285 Avenue of the Americas
New York, New York 10019
[Insert Names of Additional Existing Agents, if any]
[Insert Name of New Agent]
Dear Sirs:
Reference is hereby made to the Distribution Agreement, dated
_______, 1996 (the "Distribution Agreement"), a copy of which has
previously been delivered to you, between Northwest Natural Gas
Company, an Oregon corporation (the "Company"), and each of Merrill
Lynch, Pierce, Fenner & Smith Incorporated, PaineWebber Incorporated
and [Insert Names of Additional Existing Agents, if any], with respect
to the issue and sale by the Company of its First Mortgage Bonds,
designated Secured Medium-Term Notes, Series B, and its Unsecured
Medium-term Notes, Series B (collectively, the "Securities").
Capitalized terms used herein without definition shall have the
meanings assigned to them in the Distribution Agreement.
Subject to the terms and conditions set forth in the Distribution
Agreement, the Company hereby appoints [Insert Name of New Agent] as
agent of the Company for the purpose of soliciting and receiving
offers to purchase the Securities. In connection with such
appointment, [Insert Name of New Agent] is hereby entitled to the
benefits and subject to the duties of an Agent under the terms and
conditions of the Distribution Agreement (including the Administrative
Procedures) and by its execution hereof is hereby made a party to the
Distribution Agreement. In connection with such appointment, [Insert
Name of New Agent] shall receive as of the date hereof: [To be agreed
upon by the Company and the New Agent]
Any communication under the Distribution Agreement will be made
in accordance with Section 12 of the Distribution Agreement, and if to
[Insert Name of New Agent] shall be sufficient in all respects when
delivered or sent by facsimile transmission or registered mail to
[Insert Address of New Agent], attention: [Insert Name], facsimile
transmission number [Insert New Agent Number].
This Agreement may be executed in any number of counterparts,
each of which when so executed shall be deemed to be an original and
all of which taken together shall constitute one and the same
agreement.
If the foregoing correctly sets forth our agreement, please
indicate your acceptance hereof in the space provided for that purpose
below.
Very truly yours,
Northwest Natural Gas Company
By:____________________________
Title: Senior Vice President, Finance
and Chief Financial Officer
The foregoing Agreement is hereby
confirmed and accepted as of the
date hereof.
[INSERT NAME OF NEW AGENT]
By: ________________________
Title: ___________________
Exhibit 5(a)
BRUCE B. SAMSON
Attorney at Law
220 N.W. Second Avenue
Portland, Oregon 97209
October 31, 1996
Northwest Natural Gas Company
220 N.W. Second Avenue
Portland, Oregon 97209
Ladies and Gentlemen:
With respect to the Registration Statement on Form S-3
to be filed with the Securities and Exchange Commission (the
"Commission") on or about the date hereof by Northwest Natural
Gas Company (the "Company") for the registration under the
Securities Act of 1933, as amended, of $150,000,000 aggregate
principal amount of Secured Medium-Term Notes, Series B ("Secured
Notes") and Unsecured Medium-Term Notes, Series B ("Unsecured
Notes")(the Secured Notes and the Unsecured Notes are hereinafter
collectively referred to as the "Notes") to be issued by the
Company, and for the qualification under the Trust Indenture Act
of 1939, as amended, of the Company's Mortgage and Deed of Trust,
as supplemented ("Mortgage"), under which the Secured Notes are
to be issued, and the Company's Indenture ("Indenture") under
which the Unsecured Notes are to be issued, I am of the opinion
that:
1. The Company is a corporation duly organized and validly
existing under the laws of the State of Oregon.
2. All action necessary to make the Notes legally issued
and valid and binding obligations of the Company will have been
taken when:
(a) the Company's Registration Statement on Form S-3,
as it may be amended, shall have become effective
in accordance with the applicable provisions of
the Securities Act of 1933, as amended, and a
supplement or supplements to the Prospectus
constituting a part of the Registration Statement
specifying certain details with respect to the
offering or offerings of the Notes shall have been
filed with the Commission, and the Mortgage and
the Indenture shall have been qualified under the
Trust Indenture Act of 1939, as amended;
(b) an appropriate order or orders shall have been
issued by each of the Public Utility Commission of
Oregon and the Washington Utilities and
Transportation Commission authorizing the issuance
and sale by the Company of the Notes; and
(c) the Notes shall have been appropriately issued and
delivered for the consideration contemplated by,
and otherwise in conformity with, the acts,
proceedings and documents referred to above.
I am a member of the bar of the States of Oregon and
Washington and do not hold myself out as an expert on the laws of
any other states. As to all matters of New York law, I have
relied upon an opinion of even date herewith addressed to you by
Reid & Priest LLP which is filed as Exhibit 5(b) to the
Registration Statement.
I hereby consent to the use of this opinion as an
exhibit to the Registration Statement, as it may be amended, and
consent to such references to me as may be made in such
Registration Statement and in the Prospectus.
Very truly yours,
/s/ Bruce B. Samson
Bruce B. Samson, Esq.
Exhibit 5(b)
REID & PRIEST LLP
40 WEST 57TH STREET
NEW YORK, N. Y. 10019-4097
TELEPHONE 212 603-2000
FAX 212 603-2001
October 31, 1996
Northwest Natural Gas Company
220 N.W. Second Avenue
Portland, Oregon 97209
Ladies and Gentlemen:
With respect to the Registration Statement on Form S-3
to be filed with the Securities and Exchange Commission (the
"Commission") on or about the date hereof by Northwest Natural
Gas Company (the "Company") for the registration under the
Securities Act of 1933, as amended, of $150,000,000 aggregate
principal amount of Secured Medium-Term Notes, Series B ("Secured
Notes") and Unsecured Medium-Term Notes, Series B ("Unsecured
Notes")(the Secured Notes and the Unsecured Notes are hereinafter
collectively referred to as the "Notes") to be issued by the
Company, and for the qualification under the Trust Indenture Act
of 1939, as amended, of the Company's Mortgage and Deed of Trust,
as supplemented ("Mortgage"), under which the Secured Notes are
to be issued, and the Company's Indenture ("Indenture") under
which the Unsecured Notes are to be issued, we are of the opinion
that:
1. The Company is a corporation duly organized and validly
existing under the laws of the State of Oregon.
2. All action necessary to make the Notes legally issued
and valid and binding obligations of the Company will have been
taken when:
(a) the Company's Registration Statement on Form S-3,
as it may be amended, shall have become effective
in accordance with the applicable provisions of
the Securities Act of 1933, as amended, and a
supplement or supplements to the Prospectus
constituting a part of the Registration Statement
specifying certain details with respect to the
offering or offerings of the Notes shall have been
filed with the Commission, and the Mortgage and
the Indenture shall have been qualified under the
Trust Indenture Act of 1939, as amended;
(b) an appropriate order or orders shall have been
issued by each of the Public Utility Commission of
Oregon and the Washington Utilities and
Transportation Commission authorizing the issuance
and sale by the Company of the Notes; and
(c) the Notes shall have been appropriately issued and
delivered for the consideration contemplated by,
and otherwise in conformity with, the acts,
proceedings and documents referred to above.
We are members of the New York Bar and do not hold
ourselves out as experts on the laws of any other state. As to
all matters of Oregon and Washington law, we have relied upon an
opinion of even date herewith addressed to you by Bruce B.
Samson, Esq., which is filed as Exhibit 5(a) to the Registration
Statement.
We hereby consent to the use of this opinion as an
exhibit to the Registration Statement, as it may be amended, and
consent to such references to our firm as may be made in such
Registration Statement and in the Prospectus.
Very truly yours,
/s/ Reid & Priest LLP
REID & PRIEST LLP
EXHIBIT 15
October 31, 1996
Northwest Natural Gas Company
220 N.W. Second Avenue
Portland, Oregon 97209
We have made a review, in accordance with standards established
by the American Institute of Certified Public Accountants, of the
unaudited interim financial information of Northwest Natural Gas
Company and subsidiaries for the periods ended March 31, 1996 and
1995 and June 30, 1996 and 1995, as indicated in our reports
dated May 3, 1996 and July 25, 1996, respectively; because we did
not perform an audit, we expressed no opinion on that
information.
We are aware that our reports referred to above, which were
included in your quarterly reports on Form 10-Q for the quarters
ended March 31, 1996 and June 30, 1996, are being used in this
Registration Statement.
We also are aware that the aforementioned reports, pursuant to
Rule 436(c) under the Securities Act of 1933, are not considered
a part of the Registration Statement prepared or certified by an
accountant or a report prepared or certified by an accountant
within the meaning of Sections 7 and 11 of that Act.
/s/ Deloitte & Touceh LLP
DELOITTE & TOUCHE LLP
EXHIBIT 23
INDEPENDENT AUDITORS' CONSENT
We consent to the incorporation by reference in this Registration
Statement of Northwest Natural Gas Company and subsidiaries on
Form S-3 of our report dated February 20, 1996, appearing in the
Annual Report on Form 10-K of Northwest Natural Gas Company for
the year ended December 31, 1995 and to the reference to us under
the heading "Experts" in the Prospectus, which is part of this
Registration Statement.
/s/ Deloitte & Touche LLP
DELOITTE & TOUCHE LLP
October 31, 1996
EXHIBIT 25(a)
-----------------------------------------------------------------
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)___________
==================================================
BANKERS TRUST COMPANY
(Exact name of trustee as specified in its charter)
NEW YORK 13-4941247
(Jurisdiction of Incorporation or (I.R.S. Employer
organization if not a U.S. national bank) Identification no.)
FOUR ALBANY STREET
NEW YORK, NEW YORK 10006
(Address of principal (Zip Code)
executive offices)
BANKERS TRUST COMPANY
LEGAL DEPARTMENT
130 LIBERTY STREET, 31ST FLOOR
NEW YORK, NEW YORK 10006
(212) 250-2201
(Name, address and telephone number of agent for service)
==================================================
NORTHWEST NATURAL GAS COMPANY
(Exact name of obligor as specified in its charter)
OREGON 93-0256722
(State or other jurisdiction of (I.R.S. employer
Incorporation or organization) Identification no.)
ONE PACIFIC SQUARE
220 N.W. SECOND AVENUE
PORTLAND, OREGON 97209
(Address of principal executive offices) (Zip Code)
FIRST MORTGAGE BONDS
(Title of the indenture securities)
<PAGE>
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 7, 1990 incorporated herein
by reference to Exhibit 1 filed
with Form T-1 Statement,
Registration No. 33-65171, and
Certificate of Amendment of the
Organization Certificate of Bankers
Trust Company dated March 21, 1996,
copy attached.
EXHIBIT 2 - Certificate of Authority to
commence business - Incorporated
herein by reference to Exhibit 2
filed with Form T-1 Statement,
Registration No. 33-21047.
EXHIBIT 3 - Authorization of the Trustee to
exercise corporate trust powers -
Incorporated herein by reference to
Exhibit 2 filed with Form T-1
Statement, Registration No.
33-21047.
EXHIBIT 4 - Existing By-Laws of Bankers Trust
Company, dated as amended on
October 19, 1995. - Incorporated
herein by reference to Exhibit 4
filed with Form T-1 Statement,
Registration No. 33-65171.
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 4 filed with
Form T-1 Statement, Registration
No. 22-18864.
EXHIBIT 7 - A copy of the latest report of
condition of Bankers Trust Company
dated as of June 30, 1996.
EXHIBIT 8 - Not Applicable.
EXHIBIT 9 - Not Applicable.
<PAGE>
SIGNATURE
Pursuant to the requirements of the Trust Indenture Act of
1939, as amended, the trustee, Bankers Trust Company, 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 the 30th day of October, 1996.
BANKERS TRUST COMPANY
By: /s/ James C. McDonough
------------------------
James C. McDonough
Assistant Vice President
<PAGE>
Legal Title of Bank: Bankers Trust Company
Address: 130 Liberty Street
City, STate ZIP: New York, NY 10006
FDIC Certificate No: 00623
Call Date: 6/30/96 ST-BK: 36-4840 FFIEC 031
Vendor ID: D CERT: 00623 Page RC-1
11
CONSOLIDATED REPORT OF CONDITION FOR INSURED COMMERCIAL
AND STATE-CHARTERED SAVINGS BANKS JUNE 30, 1996
All schedules are to be reported in thousands of dollars. Unless
otherwise indicated, reported the amount outstanding as of the
last business day of the quarter.
<TABLE>
<CAPTION>
SCHEDULE RC--BALANCE SHEET
<S> <C> <C>
Dollar Amounts in Thousands RCFD Bil Mil Thou
--------------------------- ---------- -------------
ASSETS
1. Cash and balances due from
depository institutions (from
Schedule RC-A):
a. Noninterest-bearing balances and
currency and coin<F1> . . . . . 0081 1,631,000
b. Interest-bearing balances<F2> . 0071 2,066,000
2. Securities:
a. Held-to-maturity securities
(from Schedule RC-B, column A) 1754 0
b. Available-for-sale securities
(from Schedule RC-B, column D) 1773 3,761,000
3. Federal funds sold and securities
purchased under agreements to
resell in domestic offices of the
bank and of its Edge and Agreement
subsidiaries, and in IBFs:
a. Federal funds sold . . . . . . 0276 5,162,000
b. Securities purchased under
agreements to resell . . . . . 0277 4,192,000
4. Loans and lease financing
receivables:
a. Loans and leases, net of
unearned income (from Schedule
RC-C) . . . . . . . . RCFD 2122 24,849,000
b. LESS: Allowance for loan and
lease losses . . . . RCFD 3123 923,000
c. LESS: Allocated transfer risk
reserve . . . . . . . RCFD 3128 0
d. Loans and leases, net of
unearned income, allowance, and
reserve (item 4.a minus 4.b and
4.c) . . . . . . . . . . . . . 2125 23,926,000
5. Assets held in trading accounts . 3545 33,052,000
6. Premises and fixed assets
(including capitalized leases) . . 2145 858,000
7. Other real estate owned (from
Schedule RC-M) . . . . . . . . . . 2150 216,000
8. Investments in unconsolidated
subsidiaries and associated
companies (from Schedule RC-M) . . 2130 271,000
9. Customers' liability to this bank
on acceptances outstanding . . . . 2155 572,000
10. Intangible assets (from Schedule
RC-M) . . . . . . . . . . . . . . 2143 18,000
11. Other assets (from Schedule RC-F) 2160 7,612,000
12. Total assets (sum of items 1
through 11) . . . . . . . . . . . 2170 83,337,000
------------------------
</TABLE>
<F1> Includes cash items in process of collection and unposted
debits.
<F2> Includes time certificates of deposit not held in trading
accounts.
<PAGE>
<TABLE>
<CAPTION>
SCHEDULE RC--CONTINUED
<S> <C>
Dollar Amounts in Thousands Bil Mil Thou
--------------------------- ------------
LIABILITIES
13. Deposits:
a. In domestic offices (sum of totals of
columns A and C from Schedule RC-E,
part I)
(1) Noninterest-bearing<F1>
RCON 6631 3,569,000 RCON 2200 9,040,000
(2) Interest-bearing . . RCON 6636 5,471,000
b. In foreign offices, Edge and
Agreement subsidiaries, and IBFs
(from Schedule RC-E part II) RCFN 2200 19,648,000
(1) Noninterest-bearing RCFN 6631 494,000
(2) Interest-bearing . . RCFN 6636 19,154,000
14. Federal funds purchased and securities
sold under agreements to repurchase in
domestic offices of the bank and of its
Edge and Agreement subsidiaries, and in
IBFs:
a. Federal funds purchased . . . . . . RCFD 0278 2,564,000
b. Securities sold under agreements to
repurchase . . . . . . . . . . . . . RCFD 0279 790,000
15. a. Demand notes issued to the U.S.
Treasury . . . . . . . . . . . . . . RCON 2840 0
b. Trading liabilities . . . . . . . . RCFD 3548 18,177,000
16. Other borrowed money:
a. With original maturity of one year or
less . . . . . . . . . . . . . . . . RCFD 2332 16,421,000
b. With original maturity of more than
one year . . . . . . . . . . . . . . RCFD 2333 3,388,000
17. Mortgage indebtedness and obligations
under capitalized leases . . . . . . . RCFD 2910 31,000
18. Bank's liability on acceptances executed
and outstanding . . . . . . . . . . . . RCFD 2920 572,000
19. Subordinated notes and debentures . . . RCFD 3200 1,227,000
20. Other liabilities (from Schedule RC-G) RCFD 2930 6,911,000
21. Total liabilities (sum of items 13
through 20) . . . . . . . . . . . . . . RCFD 2948 78,769,000
22. Limited-life preferred stock and related
surplus . . . . . . . . . . . . . . . . RCFD 3282 0
EQUITY CAPITAL
23. Perpetual preferred stock and related
surplus . . . . . . . . . . . . . . . . RCFD 3838 500,000
24. Common stock . . . . . . . . . . . . . RCFD 3230 1,002,000
25. Surplus (exclude all surplus related to
preferred stock) . . . . . . . . . . . RCFD 3839 528,000
26. a. Undivided profits and capital
reserves . . . . . . . . . . . . . . RCFD 3632 2,915,000
b. Net unrealized holding gains (losses)
on available-for-sale securities . . RCFD 8434 (5,000)
27. Cumulative foreign currency translation
adjustments . . . . . . . . . . . . . . RCFD 3284 (372,000)
28. Total equity capital (sum of items 23
through 27) . . . . . . . . . . . . . . RCFD 3210 4,568,000
29. Total liabilities, limited-life
preferred stock, and equity capital (sum
of items 21, 22, and 28) . . . . . . . RCFD 3300 83,337,000
</TABLE>
Memorandum
To be reported only 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 any date during Number
1995...................................RCFD 6724 N/A
1 = Independent audit of the bank conducted in accordance with
generally accepted auditing standards by a certified public
accounting firm which submits a report on the bank
2 = Independent audit of the bank's parent holding company
conducted in accordance with generally accepted auditing
standards by a certified public accounting firm which
submits a report on the consolidated holding company (but
not on the bank separately)
3 = Directors' examination of the bank conducted in accordance
with generally accepted auditing standards by a certified
public accounting firm (may be required by state chartering
authority)
4 = Directors' examination of the bank performed by other
external auditors (may be required by state chartering
authority)
5 = Review of the bank's financial statements by external
auditors
6 = Compilation of the bank's financial statements by external
auditors
7 = Other audit procedures (excluding tax preparation work)
8 = No external audit work
------------------------
(1) Including total demand deposits and noninterest-bearing time
and savings deposits.
<PAGE>
STATE OF NEW YORK,
BANKING DEPARTMENT
I, PETER M. PHILBIN, Deputy Superintendent of Bank of the
State of New York, DO HEREBY APPROVE the annexed Certificate
entitled "CERTIFICATE OF AMENDMENT OF THE ORGANIZATION
CERTIFICATE OF BANKERS TRUST COMPANY UNDER SECTION 8005 OF THE
BANKING LAW," dated March 20, 1996, providing for an increase in
authorized capital stock from $1,351,666,670 consisting of
85,166,667 shares with a par value of $10 each designated as
Common Stock and 500 shares with a par value of $1,000,000 each
designated as Series Preferred Stock to $1,501,666,670 consisting
of 100,166,667 shares with a par value of $10 each designated as
Common Stock and 500 shares with a par value of $1,000,000 each
designated as Series Preferred Stock.
WITNESS, MY HAND AND OFFICIAL SEAL OF THE BANKING DEPARTMENT AT
THE CITY OF NEW YORK,
THIS 21ST DAY OF MARCH IN THE YEAR OF OUR LORD ONE
---- -----
THOUSAND NINE HUNDRED AND NINETY-SIX.
/s/ Peter M. Philbin
------------------------------
Deputy Superintendent of Banks
<PAGE>
CERTIFICATE OF AMENDMENT
OF THE
ORGANIZATION CERTIFICATE
OF BANKERS TRUST
Under Section 8005 of the Banking Law
_____________________________
We, James T. Byrne, Jr. and Lea Lahtinen, being respectively a
Managing Director and an Assistant Secretary of Bankers Trust
Company, do hereby certify:
1. The name of the corporation is Bankers Trust Company.
2. The organization certificate of said corporation was
filed by the Superintendent of Banks on the 5th of March, 1903.
3. The organization certificate as heretofore amended is
hereby amended to increase the aggregate number of shares which
the corporation shall have authority to issue and to increase the
amount of its authorized capital stock in conformity therewith.
4. Article III of the organization certificate with
reference to the authorized capital stock, the number of shares
into which the capital stock shall be divided, the par value of
the shares and the capital stock outstanding, which reads as
follows:
"III. The amount of capital stock which the corporation is
hereafter to have is One Billion, Three Hundred Fifty One
Million, Six Hundred Sixty-Six Thousand, Six Hundred Seventy
Dollars ($1,351,666,670), divided into Eighty-Five Million,
One Hundred Sixty-Six Thousand, Six Hundred Sixty-Seven
(85,166,667) shares with a par value of $10 each designated as
Common Stock and 500 shares with a par value of One Million
Dollars ($1,000,000) each designated as Series Preferred
Stock."
is hereby amended to read as follows:
"III. The amount of capital stock which the corporation is
hereafter to have is One Billion, Five Hundred One Million,
Six Hundred Sixty-Six Thousand, Six Hundred Seventy Dollars
($1,501,666,670), divided into One Hundred Million, One
Hundred Sixty Six Thousand, Six Hundred Sixty-Seven
(100,166,667) shares with a par value of $10 each designated
as Common Stock and 500 shares with a par value of One Million
Dollars ($1,000,000) each designated as Series Preferred
Stock."
6. The foregoing amendment of the organization certificate
was authorized by unanimous written consent signed by the holder
of all outstanding shares entitled to vote thereon.
IN WITNESS WHEREOF, we have made and subscribed this
certificate this 20th day of March , 1996.
/s/ James T. Byrne, Jr.
-------------------
James T. Byrne, Jr.
Managing Director
/s/ Lea Lahtinen
------------
Lea Lahtinen
Assistant Secretary
State of New York )
) ss:
County of New York )
Lea Lahtinen, being fully sworn, deposes and says that she is
an Assistant Secretary of Bankers Trust Company, the corporation
described in the foregoing certificate; that she has read the
foregoing certificate and knows the contents thereof, and that
the statements herein contained are true.
/s/ Lea Lahtinen
------------
Lea Lahtinen
Sworn to before me this 20th day
of March, 1996.
/s/ Sandra L. West
--------------
Notary Public
SANDRA L. WEST
Notary Public State of New York Counterpart filed in the
No. 31-4942101 Office of the Superintendent of
Qualified in New York County Banks, State of New York,
Commission Expires This 21st day of March, 1996
September 19, 1996
EXHIBIT 25(b)
-----------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
-------------------------------
FORM T-2
STATEMENT OF ELIGIBILITY UNDER THE TRUST INDENTURE ACT OF 1939 OF
AN INDIVIDUAL DESIGNATED TO ACT AS TRUSTEE
==================================================
STANLEY BURG ###-##-####
(Name of Trustee) (Social Security number
FOUR ALBANY STREET
NEW YORK, NEW YORK 10006
(Address of principal (Zip Code)
executive offices)
Bankers Trust Company
Legal Department
130 Liberty Street, 31st Floor
New York, New York 10006
(212) 250-2201
(Name, address and telephone number of agent for service)
==================================================
NORTHWEST NATURAL GAS COMPANY
(Exact name of obligor as specified in its charter)
OREGON 93-0256722
(State or other jurisdiction of (I.R.S. employer
Incorporation or organization) Identification no.)
ONE PACIFIC SQUARE
220 N.W. SECOND AVENUE
PORTLAND, OREGON 97209
(Address of principal executive offices) (Zip Code)
FIRST MORTGAGE BONDS
(Title of the indenture securities)
<PAGE>
ITEM 1. AFFILIATIONS WITH OBLIGOR.
If the obligor is an affiliate of the Trustee,
describe each such affiliation.
None.
ITEM 2. -10. NOT APPLICABLE
ITEM 11. LIST OF EXHIBITS.
List below all exhibits filed as a part of this
statement of eligibility and qualification.
None.
SIGNATURE
Pursuant to the requirements of the Trust Indenture Act of
1939, I, Stanley Burg, have signed this statement of eligibility
in The City of New York, and State of New York, on the 30th day
of October, 1996.
By: /s/ Stanley Burg
-----------------------
Stanley Burg
(Signature of the trustee)
EXHIBIT 25(c)
-----------------------------------------------------------------
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)___________
==================================================
BANKERS TRUST COMPANY
(Exact name of trustee as specified in its charter)
NEW YORK 13-4941247
(Jurisdiction of Incorporation or (I.R.S. Employer
organization if not a U.S. national bank) Identification no.)
FOUR ALBANY STREET
NEW YORK, NEW YORK 10006
(Address of principal (Zip Code)
executive offices)
BANKERS TRUST COMPANY
LEGAL DEPARTMENT
130 LIBERTY STREET, 31ST FLOOR
NEW YORK, NEW YORK 10006
(212) 250-2201
(Name, address and telephone number of agent for service)
==================================================
NORTHWEST NATURAL GAS COMPANY
(Exact name of obligor as specified in its charter)
OREGON 93-0256722
(State or other jurisdiction of (I.R.S. employer
Incorporation or organization) Identification no.)
ONE PACIFIC SQUARE
220 N.W. SECOND AVENUE
PORTLAND, OREGON 97209
(Address of principal executive offices) (Zip Code)
DEBT SECURITIES
(Title of the indenture securities)
<PAGE>
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 7, 1990 incorporated herein
by reference to Exhibit 1 filed
with Form T-1 Statement,
Registration No. 33-65171, and
Certificate of Amendment of the
Organization Certificate of Bankers
Trust Company dated March 21, 1996,
copy attached.
EXHIBIT 2 - Certificate of Authority to
commence business - Incorporated
herein by reference to Exhibit 2
filed with Form T-1 Statement,
Registration No. 33-21047.
EXHIBIT 3 - Authorization of the Trustee to
exercise corporate trust powers -
Incorporated herein by reference to
Exhibit 2 filed with Form T-1
Statement, Registration No.
33-21047.
EXHIBIT 4 - Existing By-Laws of Bankers Trust
Company, dated as amended on
October 19, 1995. - Incorporated
herein by reference to Exhibit 4
filed with Form T-1 Statement,
Registration No. 33-65171.
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 4 filed with
Form T-1 Statement, Registration
No. 22-18864.
EXHIBIT 7 - A copy of the latest report of
condition of Bankers Trust Company
dated as of June 30, 1996.
EXHIBIT 8 - Not Applicable.
EXHIBIT 9 - Not Applicable.
<PAGE>
SIGNATURE
Pursuant to the requirements of the Trust Indenture Act of
1939, as amended, the trustee, Bankers Trust Company, 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 the 30th day of October, 1996.
BANKERS TRUST COMPANY
By: /s/ James C. McDonough
------------------------
James C. McDonough
Assistant Vice President
<PAGE>
Legal Title of Bank: Bankers Trust Company
Address: 130 Liberty Street
City, STate ZIP: New York, NY 10006
FDIC Certificate No: 00623
Call Date: 6/30/96 ST-BK: 36-4840 FFIEC 031
Vendor ID: D CERT: 00623 Page RC-1
11
CONSOLIDATED REPORT OF CONDITION FOR INSURED COMMERCIAL
AND STATE-CHARTERED SAVINGS BANKS JUNE 30, 1996
All schedules are to be reported in thousands of dollars. Unless
otherwise indicated, reported the amount outstanding as of the
last business day of the quarter.
<TABLE>
<CAPTION>
SCHEDULE RC--BALANCE SHEET
<S> <C> <C>
Dollar Amounts in Thousands RCFD Bil Mil Thou
--------------------------- ---------- -------------
ASSETS
1. Cash and balances due from
depository institutions (from
Schedule RC-A):
a. Noninterest-bearing balances and
currency and coin<F1> . . . . . 0081 1,631,000
b. Interest-bearing balances<F2> . 0071 2,066,000
2. Securities:
a. Held-to-maturity securities
(from Schedule RC-B, column A) 1754 0
b. Available-for-sale securities
(from Schedule RC-B, column D) 1773 3,761,000
3. Federal funds sold and securities
purchased under agreements to
resell in domestic offices of the
bank and of its Edge and Agreement
subsidiaries, and in IBFs:
a. Federal funds sold . . . . . . 0276 5,162,000
b. Securities purchased under
agreements to resell . . . . . 0277 4,192,000
4. Loans and lease financing
receivables:
a. Loans and leases, net of
unearned income (from Schedule
RC-C) . . . . . . . . RCFD 2122 24,849,000
b. LESS: Allowance for loan and
lease losses . . . . RCFD 3123 923,000
c. LESS: Allocated transfer risk
reserve . . . . . . . RCFD 3128 0
d. Loans and leases, net of
unearned income, allowance, and
reserve (item 4.a minus 4.b and
4.c) . . . . . . . . . . . . . 2125 23,926,000
5. Assets held in trading accounts . 3545 33,052,000
6. Premises and fixed assets
(including capitalized leases) . . 2145 858,000
7. Other real estate owned (from
Schedule RC-M) . . . . . . . . . . 2150 216,000
8. Investments in unconsolidated
subsidiaries and associated
companies (from Schedule RC-M) . . 2130 271,000
9. Customers' liability to this bank
on acceptances outstanding . . . . 2155 572,000
10. Intangible assets (from Schedule
RC-M) . . . . . . . . . . . . . . 2143 18,000
11. Other assets (from Schedule RC-F) 2160 7,612,000
12. Total assets (sum of items 1
through 11) . . . . . . . . . . . 2170 83,337,000
------------------------
</TABLE>
<F1> Includes cash items in process of collection and unposted
debits.
<F2> Includes time certificates of deposit not held in trading
accounts.
<PAGE>
<TABLE>
<CAPTION>
SCHEDULE RC--CONTINUED
<S> <C>
Dollar Amounts in Thousands Bil Mil Thou
--------------------------- ------------
LIABILITIES
13. Deposits:
a. In domestic offices (sum of totals of
columns A and C from Schedule RC-E,
part I)
(1) Noninterest-bearing<F1>
RCON 6631 3,569,000 RCON 2200 9,040,000
(2) Interest-bearing . . RCON 6636 5,471,000
b. In foreign offices, Edge and
Agreement subsidiaries, and IBFs
(from Schedule RC-E part II) RCFN 2200 19,648,000
(1) Noninterest-bearing RCFN 6631 494,000
(2) Interest-bearing . . RCFN 6636 19,154,000
14. Federal funds purchased and securities
sold under agreements to repurchase in
domestic offices of the bank and of its
Edge and Agreement subsidiaries, and in
IBFs:
a. Federal funds purchased . . . . . . RCFD 0278 2,564,000
b. Securities sold under agreements to
repurchase . . . . . . . . . . . . . RCFD 0279 790,000
15. a. Demand notes issued to the U.S.
Treasury . . . . . . . . . . . . . . RCON 2840 0
b. Trading liabilities . . . . . . . . RCFD 3548 18,177,000
16. Other borrowed money:
a. With original maturity of one year or
less . . . . . . . . . . . . . . . . RCFD 2332 16,421,000
b. With original maturity of more than
one year . . . . . . . . . . . . . . RCFD 2333 3,388,000
17. Mortgage indebtedness and obligations
under capitalized leases . . . . . . . RCFD 2910 31,000
18. Bank's liability on acceptances executed
and outstanding . . . . . . . . . . . . RCFD 2920 572,000
19. Subordinated notes and debentures . . . RCFD 3200 1,227,000
20. Other liabilities (from Schedule RC-G) RCFD 2930 6,911,000
21. Total liabilities (sum of items 13
through 20) . . . . . . . . . . . . . . RCFD 2948 78,769,000
22. Limited-life preferred stock and related
surplus . . . . . . . . . . . . . . . . RCFD 3282 0
EQUITY CAPITAL
23. Perpetual preferred stock and related
surplus . . . . . . . . . . . . . . . . RCFD 3838 500,000
24. Common stock . . . . . . . . . . . . . RCFD 3230 1,002,000
25. Surplus (exclude all surplus related to
preferred stock) . . . . . . . . . . . RCFD 3839 528,000
26. a. Undivided profits and capital
reserves . . . . . . . . . . . . . . RCFD 3632 2,915,000
b. Net unrealized holding gains (losses)
on available-for-sale securities . . RCFD 8434 (5,000)
27. Cumulative foreign currency translation
adjustments . . . . . . . . . . . . . . RCFD 3284 (372,000)
28. Total equity capital (sum of items 23
through 27) . . . . . . . . . . . . . . RCFD 3210 4,568,000
29. Total liabilities, limited-life
preferred stock, and equity capital (sum
of items 21, 22, and 28) . . . . . . . RCFD 3300 83,337,000
</TABLE>
Memorandum
To be reported only 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 any date during Number
1995...................................RCFD 6724 N/A
1 = Independent audit of the bank conducted in accordance with
generally accepted auditing standards by a certified public
accounting firm which submits a report on the bank
2 = Independent audit of the bank's parent holding company
conducted in accordance with generally accepted auditing
standards by a certified public accounting firm which
submits a report on the consolidated holding company (but
not on the bank separately)
3 = Directors' examination of the bank conducted in accordance
with generally accepted auditing standards by a certified
public accounting firm (may be required by state chartering
authority)
4 = Directors' examination of the bank performed by other
external auditors (may be required by state chartering
authority)
5 = Review of the bank's financial statements by external
auditors
6 = Compilation of the bank's financial statements by external
auditors
7 = Other audit procedures (excluding tax preparation work)
8 = No external audit work
------------------------
(1) Including total demand deposits and noninterest-bearing time
and savings deposits.
<PAGE>
STATE OF NEW YORK,
BANKING DEPARTMENT
I, PETER M. PHILBIN, Deputy Superintendent of Bank of the
State of New York, DO HEREBY APPROVE the annexed Certificate
entitled "CERTIFICATE OF AMENDMENT OF THE ORGANIZATION
CERTIFICATE OF BANKERS TRUST COMPANY UNDER SECTION 8005 OF THE
BANKING LAW," dated March 20, 1996, providing for an increase in
authorized capital stock from $1,351,666,670 consisting of
85,166,667 shares with a par value of $10 each designated as
Common Stock and 500 shares with a par value of $1,000,000 each
designated as Series Preferred Stock to $1,501,666,670 consisting
of 100,166,667 shares with a par value of $10 each designated as
Common Stock and 500 shares with a par value of $1,000,000 each
designated as Series Preferred Stock.
WITNESS, MY HAND AND OFFICIAL SEAL OF THE BANKING DEPARTMENT AT
THE CITY OF NEW YORK,
THIS 21ST DAY OF MARCH IN THE YEAR OF OUR LORD ONE
---- -----
THOUSAND NINE HUNDRED AND NINETY-SIX.
/s/ Peter M. Philbin
------------------------------
Deputy Superintendent of Banks
<PAGE>
CERTIFICATE OF AMENDMENT
OF THE
ORGANIZATION CERTIFICATE
OF BANKERS TRUST
Under Section 8005 of the Banking Law
_____________________________
We, James T. Byrne, Jr. and Lea Lahtinen, being respectively a
Managing Director and an Assistant Secretary of Bankers Trust
Company, do hereby certify:
1. The name of the corporation is Bankers Trust Company.
2. The organization certificate of said corporation was
filed by the Superintendent of Banks on the 5th of March, 1903.
3. The organization certificate as heretofore amended is
hereby amended to increase the aggregate number of shares which
the corporation shall have authority to issue and to increase the
amount of its authorized capital stock in conformity therewith.
4. Article III of the organization certificate with
reference to the authorized capital stock, the number of shares
into which the capital stock shall be divided, the par value of
the shares and the capital stock outstanding, which reads as
follows:
"III. The amount of capital stock which the corporation is
hereafter to have is One Billion, Three Hundred Fifty One
Million, Six Hundred Sixty-Six Thousand, Six Hundred Seventy
Dollars ($1,351,666,670), divided into Eighty-Five Million,
One Hundred Sixty-Six Thousand, Six Hundred Sixty-Seven
(85,166,667) shares with a par value of $10 each designated as
Common Stock and 500 shares with a par value of One Million
Dollars ($1,000,000) each designated as Series Preferred
Stock."
is hereby amended to read as follows:
"III. The amount of capital stock which the corporation is
hereafter to have is One Billion, Five Hundred One Million,
Six Hundred Sixty-Six Thousand, Six Hundred Seventy Dollars
($1,501,666,670), divided into One Hundred Million, One
Hundred Sixty Six Thousand, Six Hundred Sixty-Seven
(100,166,667) shares with a par value of $10 each designated
as Common Stock and 500 shares with a par value of One Million
Dollars ($1,000,000) each designated as Series Preferred
Stock."
6. The foregoing amendment of the organization certificate
was authorized by unanimous written consent signed by the holder
of all outstanding shares entitled to vote thereon.
IN WITNESS WHEREOF, we have made and subscribed this
certificate this 20th day of March , 1996.
/s/ James T. Byrne, Jr.
-------------------
James T. Byrne, Jr.
Managing Director
/s/ Lea Lahtinen
------------
Lea Lahtinen
Assistant Secretary
State of New York )
) ss:
County of New York )
Lea Lahtinen, being fully sworn, deposes and says that she is
an Assistant Secretary of Bankers Trust Company, the corporation
described in the foregoing certificate; that she has read the
foregoing certificate and knows the contents thereof, and that
the statements herein contained are true.
/s/ Lea Lahtinen
------------
Lea Lahtinen
Sworn to before me this 20th day
of March, 1996.
/s/ Sandra L. West
--------------
Notary Public
SANDRA L. WEST
Notary Public State of New York Counterpart filed in the
No. 31-4942101 Office of the Superintendent of
Qualified in New York County Banks, State of New York,
Commission Expires This 21st day of March, 1996
September 19, 1996
