SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-Q
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended MARCH 31, 1996
<TABLE>
<CAPTION>
<S> <C> <C>
Registrant; State of Incorporation; IRS Employer
COMMISSION FILE NUMBER ADDRESS; AND TELEPHONE NUMBER IDENTIFICATION NO.
1-5532 PORTLAND GENERAL CORPORATION 93-0909442
(an Oregon Corporation)
121 SW Salmon Street
Portland, Oregon 97204
(503) 464-8820
1-5532-99 PORTLAND GENERAL ELECTRIC COMPANY 93-0256820
(an Oregon Corporation)
121 SW Salmon Street
Portland, Oregon 97204
(503) 464-8000
</TABLE>
Indicate by check mark whether the registrants (1) have filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrants were required to file such reports), and (2) have been subject to
such filing requirements for the past 90 days. Yes X . No .
The number of shares outstanding of the registrants' common stocks as of April
30, 1996 are:
Portland General Corporation 51,103,657
Portland General Electric Company 42,758,877
(owned by Portland General Corporation)
1
<PAGE>
INDEX
PAGE
NUMBER
PART I. PORTLAND GENERAL CORPORATION AND SUBSIDIARIES
FINANCIAL INFORMATION
Management's Discussion and Analysis of
Financial Condition and Results of Operations 3
Consolidated Statements of Income 10
Consolidated Statements of Retained Earnings 10
Consolidated Balance Sheets 11
Consolidated Statements of Cash Flow 12
Notes to Consolidated Financial Statements 13
Portland General Electric Company and
Subsidiaries Financial Information 16
PART II. OTHER INFORMATION
Item 1 - Legal Proceedings 19
Item 6 - Exhibits and Reports on Form 8-K 20
Signature Page 21
2
<PAGE>
PORTLAND GENERAL CORPORATION AND SUBSIDIARIES
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS
RESULTS OF OPERATIONS
Portland General Electric Company (PGE or the Company), an electric
utility company and the principal operating subsidiary of Portland General
Corporation (Portland General or PGC), accounts for substantially all of
Portland General's assets, revenues and net income. The following
discussion focuses on utility operations, unless otherwise noted.
1996 COMPARED TO 1995 FOR THE THREE MONTHS ENDED MARCH 31
Portland General earned $49 million or $0.97 per share for the first
quarter of 1996 compared to a loss of $2 million or $0.04 per share in
1995. 1995 earnings include a one time $37 million after tax charge to
income relating to the writeoff of 13% of PGE's investment in the Trojan
Nuclear Plant (Trojan). Excluding the Trojan loss, 1995 earnings would
have been $35 million or $0.69 per share. Improved 1996 operating
earnings include the effects of very favorable hydro conditions, cooler
temperatures and continued retail load growth.
Retail revenues increased by $22 million, or 9%, for the period, due to
both higher rates and a 4% overall increase in energy sales. The
Company's April 1995 general rate increase and subsequent rate adjustment
for Coyote Springs in November 1995 resulted in approximately $13 million
of additional revenue. Energy sales increased 180,421 megawatt-hours
(MWh), primarily due to cooler weather resulting in approximately $9
million of additional revenue. Average temperatures in January and
February were significantly cooler than in 1995. PGE set record peak-
loads during the first week of February as temperatures dropped below
freezing.
Weather adjusted sales were up only 1%. The continued strong growth in
the high tech sector was offset by a decrease in overall industrial
sales, primarily due to production cutbacks by paper manufacturing.
Nevertheless, commercial and residential sales were strong with the
addition of over 4,170 retail customers during the quarter. On average
PGE served over 15,400 more retail customers than in 1995.
Wholesale revenues increased $17 million or 82% from 1995 despite a 49%
decrease in average sale prices. Aggressive marketing of abundant hydro
generated power combined with a higher demand for power increased sales to
3 1/2 times last year's levels.
Purchased power and fuel expense decreased $5.4 million despite a 33%
increase in total system load as the average cost of power decreased from
17.9 to 12.9 mills (10 mills = 1 cent). Record rainfall resulted in
excellent hydro conditions which contributed to significant supplies of
low cost secondary energy in the region and kept thermal plants idle.
PGE hydro generation increased 15%, or 109,900 MWh, reflecting good water
conditions on the Clackamas River system. PGE thermal generation decreased
1,103,500 MWh and accounted for only 5% of total Company energy
requirements compared to 27% last year.
3
<PAGE>
PORTLAND GENERAL CORPORATION AND SUBSIDIARIES
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS
Energy purchases were up 88% due to thermal displacement and increased
load while abundant supplies of energy drove wholesale prices below 1995
levels. Firm purchases averaged 14.6 mills compared to 26.3 mills last
year due to favorable hydro conditions on the mid-Columbia. Spot market
purchases averaged 9.3 mills compared to an average 11.9 mills in 1994.
<TABLE>
<CAPTION>
RESOURCE MIX/VARIABLE POWER COSTS
<S> <C> <C> <C> <C> <C>
Average Variable
Resource Mix Power Cost (Mills/KWh)
1996 1995 1996 1995
Generation 17% 40% 4.4 7.9
Firm Purchases 67 44 14.6 26.3
Spot Purchases 16 16 9.3 11.9
Total Resources 100% 100% Average 12.9 17.9
</TABLE>
PGE does not have a fuel adjustment clause as part of its
retail rate structure; therefore, changes in fuel and
purchased power expenses are reflected currently in earnings.
Operating expenses (excluding variable power, depreciation and
income taxes) were nearly $14 million higher than last year.
The increase included approximately $5 million in storm and
flood related expenditures and maintenance of the distribution
system deferred from last year, $4 million in incremental firm
natural gas transportation capacity to support Coyote Springs
operations and additional firm capacity at Beaver as well as
increased marketing and support costs to serve PGE's growing
base of retail customers.
Depreciation increased $6 million, or 19%, largely due to new
depreciation rates and Coyote Springs being placed in service.
Income taxes increased $10 million primarily due to an
increase in before tax operating income. Preferred stock
dividends decreased due to less preferred stock outstanding.
During 1995 PGE redeemed nearly $80 million of preferred
stock.
Allowance for Funds Used During Construction has dropped to
levels which reflect no further significant investment in new
generating resources. In addition, the 1995 period included
approximately $3 million in accrued interest income on
regulatory assets primarily related to the Company's
outstanding power cost deferrals.
Due to seasonal fluctuations in electricity sales, as well as
the price of wholesale energy and fuel costs, quarterly
operating earnings are not necessarily indicative of results
to be expected for calendar year 1996.
4
<PAGE>
PORTLAND GENERAL CORPORATION AND SUBSIDIARIES
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS
CASH FLOW
PORTLAND GENERAL CORPORATION
Portland General requires cash to pay dividends to its common
stockholders, to provide funds to its subsidiaries, to meet
debt service obligations and for day to day operations.
Sources of cash are dividends from PGE, leasing rentals,
short- and intermediate-term borrowings and the sale of its
common stock.
In February 1996, the Board of Directors approved an increase
in PGC's quarterly dividend from $.30 to $.32 per share. This
is the first change to Portland General's dividend since April
1990.
Portland General received $13.7 million in dividends from PGE
during the first quarter of 1996 and $1.4 million in proceeds
from the exercise of stock options and purchases under the
Employee Stock Purchase Plan. Beginning in November 1995 PGC
began open market purchases of common stock for its Dividend
Reinvestment and Optional Cash Payment Plan.
PORTLAND GENERAL ELECTRIC COMPANY
CASH PROVIDED BY OPERATIONS is used to meet the day-to-day
cash requirements of PGE. Supplemental cash is obtained from
external borrowings as needed.
A significant portion of cash from operations comes from
depreciation and amortization of utility plant, charges which
are recovered in customer revenues but require no current cash
outlay. Changes in accounts receivable and accounts payable
can also be significant contributors or users of cash.
Improved cash flow for the current year reflects a higher
percentage of cash revenues combined with lower variable power
costs.
INVESTING ACTIVITIES include improvements to generation,
transmission and distribution facilities and continued
investment in energy efficiency programs. Capital
expenditures for 1996 of approximately $170 million are
expected to be fully funded by operating cash flows. Through
March 31, 1996 nearly $33 million has been expended for
capital projects, primarily improvements to the Company's
distribution system to support the addition of new customers
to PGE's service territory.
PGE funds an external trust for Trojan decommissioning costs.
The April 1995 general rate order authorized PGE to increase
its collections from customers and its corresponding
contribution to the trust from $11 million to $14 million
annually. The trust invests in investment-grade tax-exempt
and U.S. Treasury bonds. The Company makes regular
withdrawals from the trust for reimbursement of
decommissioning expenditures.
5
<PAGE>
PORTLAND GENERAL CORPORATION AND SUBSIDIARIES
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS
FINANCING ACTIVITIES - In January 1996 the Company called
$47.6 million of the 7 3/4% and the 7.95% First Mortgage Bonds
due in 2002 and 2003 respectively. In addition, in March 1996
PGE retired a $35 million variable rate note which the Company
had issued to a commercial bank in January 1996. The note was
not due to mature until January 1997.
On April 15, 1996 PGE redeemed the 200,000 outstanding shares
of its 8.10% preferred stock, at par. The $20 million
redemption leaves only the Company's 7.75% preferred
stock outstanding which has sinking fund requirements beginning in
2002.
In March 1996 both Standard & Poor's Investor Services (S&P)
and Moody's Investor Services (Moody's) upgraded PGE's debt
ratings. S&P upgraded PGE's senior secured debt from A- to A,
its unsecured debt from BBB+ to A-, and commercial paper from
A2 to A1 with a Stable Outlook. Similarly Moody's upgraded
the Company's debt ratings, raising PGE's secured debt from A3
to A2, unsecured debt from Baa1 to A3 and commercial paper
from P2 to P1. The improved ratings, especially on short-term
debt, should help lower the Company's future borrowing costs.
The issuance of additional preferred stock and First Mortgage
Bonds requires PGE to meet earnings coverage and security
provisions set forth in the Articles of Incorporation and
Indenture securing its First Mortgage Bonds. As of March 31,
1996, PGE has the capability to issue up to approximately $800 million
of preferred stock and $500 million of additional First Mortgage Bonds.
FINANCIAL AND OPERATING OUTLOOK
UTILITY
COMPETITION
The Energy Policy Act of 1992 (Energy Act) set the stage for
change in federal and state regulations aimed at increasing
both wholesale and retail competition in the electric
industry. The Energy Act eased restrictions on independent
power production and granted authority to the Federal Energy
Regulatory Commission (FERC) to mandate open access for the
wholesale transmission of electricity.
FERC has taken steps to provide a framework for increased
competition in the electric industry. On April 24, 1996 FERC
issued final rules requiring non-discriminatory open access
transmission by all public utilities that own interstate
transmission. The final rule requires utilities to file
tariffs that offer others the same transmission services they
provide themselves under comparable terms and conditions.
This rule allows public utilities to recover stranded costs
resulting from investment made to provide services to wholesale
customers. The new ruling requires reciprocity from
municipals, cooperatives and federal power marketers receiving
service under the new tariff. The new rules will go into
effect mid-year 1996 and are expected to result in increased
competition, lower prices and more choices to wholesale energy
customers.
6
<PAGE>
PORTLAND GENERAL CORPORATION AND SUBSIDIARIES
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS
The FERC action applies only to the wholesale transmission of
electricity and does not proscribe terms and conditions of
retail transmission service which is subject to individual
state regulation. Since the passage of the Energy Act,
various state utility commissions have addressed proposals
which would gradually allow retail customers direct access to
generation suppliers, marketers, brokers and other service
providers in a competitive marketplace for energy services.
Although presently operating in a cost-based regulated
environment, PGE expects increasing competition from other
forms of energy and other suppliers of electricity. While the
Company is unable to determine the future impact of increased
competition, it believes that ultimately it will result in
reduced retail as well as wholesale prices.
RETAIL CUSTOMER GROWTH AND ENERGY SALES
During the first quarter of 1996, over 4,170 retail customers
were added to PGE's service territory. Weather adjusted retail
energy sales growth for the three months ended March 31, 1996
was approximately 1.0%. Commercial and residential weather
adjusted sales increased 2.2% and 2.1% respectively. High-
tech and transportation industrial sales were strong; however,
production cutbacks by paper manufacturing caused total
industrial sales to be off approximately 3.8% for the quarter.
The Company expects annual 1996 retail energy sales growth to
be approximately 4.6%.
WHOLESALE MARKETING
The current surplus of electric generating capability in the
Western U.S., the entrance of numerous wholesale marketers and
brokers into the market, and open access transmission will
contribute to increasing pressure on the price of power. In
addition the development of financial markets and the NYMEX
futures trading (discussed below) have led to increased
information available to market participants, further adding
to the competitive pressure on wholesale prices.
Despite increasing competition, Company wholesale revenues
continue to make a growing contribution providing nearly 13%
of total operating revenues and increasing almost 82% compared
to first quarter of 1995. The growth in wholesale sales is
attributed to PGE's aggressive sales efforts as part of the
Company's plan to expand its existing marketing capabilities
and activities throughout the Western U.S.
7
<PAGE>
PORTLAND GENERAL CORPORATION AND SUBSIDIARIES
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS
POWER SUPPLY
Current projections forecast the annual runoff of the Columbia
River at the Dalles to be 20 percent above normal, assuming
normal precipitation for the rest of the season.
Precipitation during the 1995-96 winter season has been 128
percent of normal. Not since the early 1980's has the region
had more favorable hydro conditions. Current water conditions
should result in continued high levels of hydro generation
during the January - July run-off season as well as provide
ample water supplies to refill reservoirs for the remainder of
the year. As a result of the availability of low-cost hydro
generation, thermal plants operated by PGE are currently in
economic shutdown. Given current forecasts prove accurate it
is likely that hydro generation will continue to be a major
factor in the availability of low-cost secondary power and the
economic dispatch of higher cost thermal generation.
COMMODITY PRICE RISK MANAGEMENT
The Company is exposed to market risk arising from the need to purchase
fuel for its generating units (both natural gas and coal) as well as the
direct purchase and sale of wholesale electricity in support of its
retail and wholesale markets. The Company uses financial instruments,
such as commodity futures, options, forwards and swaps, to hedge the price
of natural gas and electricity and reduce the Company's exposure to market
fluctuations in the price of natural gas and electricity as well as for
trading purposes.
Hedging transactions consist primarily of fixed for floating swap agreements
and the use of electric futures contracts. In 1996 the Company began active
trading of financial instruments. Trading activities include the use of
electric and natural gas swap agreements, the sale of electric and natural
gas options, and participation in the recent sale and trading of electric
futures contracts. PGE's total market risk is evaluated on an on-going
basis and monitored against risk limits approved by PGE's Board of
Directors.
ELECTRIC FUTURES TRADING - The Company has been an active
participant in the electric futures market since the contracts
began trading on the New York Mercantile Exchange (NYMEX) on
March 29, 1996. The futures contracts allow for delivery of
736 MWh of electricity at the California-Oregon Border or at
Palo-Verde.
REGULATORY MATTERS
APPLICATION FOR RECONSIDERATION DENIED - On March 4, 1996 the
Public Utility Commission of Oregon (OPUC or the Commission)
denied the Citizens' Utility Board's (CUB) application for
reconsideration of a November 1995 order allowing PGE to
recover the capital and fixed costs associated with Coyote
Springs.
CUB's appeal requested review of the adequacy of natural gas
forecasts in light of recent reductions
8
<PAGE>
PORTLAND GENERAL CORPORATION AND SUBSIDIARIES
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS
in the price of
natural gas. In denying the application the Commission found
that this issue was adequately addressed in the November
order. However, the Commission stated their recognition of
the importance of the issue raised by CUB and the eventual
need for such reductions, if they continue, to benefit
customers. PGE has agreed to work with OPUC staff and other
interested parties to develop a plan for dealing with the
issue in 1997.
For further information on the November 1995 Coyote Springs
order or the Company's March 1995 general rate order see
Portland General's and PGE's reports on Form 10-K for the year
ended December 31, 1995.
TROJAN INVESTMENT RECOVERY - On April 4, 1996 a circuit court
judge in Marion County, Oregon
contradicted a November 1994 ruling from the same court,
finding that the OPUC could not authorize PGE to collect a
return on its undepreciated investment in Trojan currently
in PGE's rate base. The ruling was the result of an appeal of
PGE's 1995 general rate order which granted PGE recovery of,
and a return on, 87% of its remaining investment in Trojan.
The November 1994 ruling, by a different judge of the same
court, upheld the Commission's 1993 Declaratory Ruling (DR-
10). In DR-10 the OPUC ruled that PGE could recover and earn
a return on its undepreciated Trojan investment, provided
certain conditions were met. The Commission relied on a 1992
Oregon Department of Justice opinion issued by the Attorney
General's office stating that the Commission had the authority
to set prices including recovery of and on investment in plant
that is no longer in service.
The 1994 ruling was appealed to the Oregon Court of Appeals
and stayed pending the appeal of the Commission's March 1995
order. PGE has appealed the April 1996 ruling which will
likely be combined with the appeal of the November 1994 ruling
at the Oregon Court of Appeals.
For further information regarding the legal challenges to the
OPUC's authority to grant recovery of PGE's Trojan investment
see Item 3, Legal proceedings, of Portland General's and
PGE's Forms 10-K for the year ended December 31, 1995.
TROJAN DECOMMISSIONING - In early 1996 both the Nuclear
Regulatory Commission (NRC) and the Oregon Energy Facility
Siting Council (EFSC) approved the Trojan Decommissioning
Plan. Approval of the plan by these regulatory agencies will
allow PGE to commence decommissioning activities, the majority
of which will occur between 1997 and 2001.
LITIGATION SETTLEMENT REACHED
WESTINGHOUSE - PGE and Westinghouse Electric Corporation have
reached a settlement in PGE's lawsuit which was filed in 1993
against Westinghouse regarding steam generators supplied by
Westinghouse to Trojan. Terms of the settlement are
confidential. The Company does not expect the settlement to
have a material effect on the PGE's results of operations,
cash flows or financial condition for any future reporting
period.
9
<PAGE>
PORTLAND GENERAL CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME FOR THE
THREE MONTHS ENDED MARCH 31, 1996 AND 1995
(Unaudited)
<TABLE>
<CAPTION>
Three Months Ended
<S> <C> <C>
March 31
1996 1995
(Thousands of Dollars)
OPERATING REVENUES $ 300,581 $ 259,177
OPERATING EXPENSES
Purchased power and fuel 82,297 87,696
Production and distribution 21,952 15,153
Maintenance and repairs 13,249 9,933
Administrative and other 27,685 25,140
Depreciation and amortization 37,533 31,458
Taxes other than income taxes 14,893 13,757
197,609 183,137
OPERATING INCOME BEFORE INCOME TAXES 102,972 76,040
INCOME TAXES 36,228 26,487
NET OPERATING INCOME 66,744 49,553
OTHER INCOME (DEDUCTIONS)
Regulatory disallowance - net of income taxes of $25,542 - (36,708)
Interest expense (19,768) (19,195)
Allowance for funds used during construction 242 2,148
Preferred dividend requirement - PGE (986) (2,583)
Other - net of income taxes 3,130 4,831
NET INCOME/(LOSS) $ 49,362 $ (1,954)
COMMON STOCK
Average shares outstanding 51,063,105 50,591,449
Earnings/(Loss) per average share $0.97 ($0.04)
Dividends declared per share $0.32 $0.30
CONSOLIDATED STATEMENTS OF RETAINED EARNINGS FOR THE
THREE MONTHS ENDED MARCH 31, 1996 AND 1995
(Unaudited)
Three Months Ended
March 31
1996 1995
(Thousands of Dollars)
BALANCE AT BEGINNING OF PERIOD $ 135,885 $ 118,676
NET INCOME/(LOSS) 49,362 (1,954)
ESOP TAX BENEFIT AND OTHER (530) (474)
184,717 116,248
DIVIDENDS DECLARED ON COMMON 16,352 15,185
STOCK
BALANCE AT END OF PERIOD $ 168,365 $ 101,063
The accompanying notes are an integral part of these consolidated statements.
</TABLE>
10
<PAGE>
PORTLAND GENERAL CORPORATION AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
AS OF MARCH 31, 1996 AND DECEMBER 31, 1995
(Unaudited)
<TABLE>
<CAPTION>
(Unaudited)
<S> <C> <C>
March 31 December 31
1996 1995
(Thousands of Dollars)
ASSETS
ELECTRIC UTILITY PLANT - ORIGINAL COST
Utility plant (includes Construction Work in Progress of
$43,483 and $33,382) $ 2,785,437 $ 2,754,280
Accumulated depreciation (1,066,333) (1,040,014)
1,719,104 1,714,266
Capital leases - less amortization of $28,508 and $27,966 8,810 9,353
1,727,914 1,723,619
OTHER PROPERTY AND INVESTMENTS
Leveraged leases 152,417 152,666
Trojan decommissioning trust, at market value 71,204 68,774
Corporate owned life insurance, less loans of $27,763 and $26,432 74,093 74,574
Other investments 35,267 28,603
332,981 324,617
CURRENT ASSETS
Cash and cash equivalents 11,342 11,919
Accounts and notes receivable 110,231 104,815
Unbilled and accrued revenues 58,202 64,516
Inventories, at average cost 38,859 38,338
Prepayments and other 25,491 16,953
244,125 236,541
DEFERRED CHARGES
Unamortized regulatory assets
Trojan investment 295,577 301,023
Trojan decommissioning 306,768 311,403
Income taxes recoverable 213,842 217,366
Debt reacquisition costs 29,929 29,576
Energy efficiency programs 79,074 77,945
Other 27,126 27,611
WNP-3 settlement exchange agreement 167,103 168,399
Miscellaneous 29,461 29,917
1,148,880 1,163,240
$ 3,453,900 $ 3,448,017
CAPITALIZATION AND LIABILITIES
CAPITALIZATION
Common stock equity
Common stock, $3.75 par value per share, 100,000,000 shares authorized,
51,100,857 and 51,013,549 shares outstanding $ 191,628 $ 191,301
Other paid-in capital - net 576,104 574,468
Unearned compensation (7,291) (8,506)
Retained earnings 168,365 135,885
928,806 893,148
Cumulative preferred stock of subsidiary
Subject to mandatory redemption 30,000 40,000
Long-term debt 865,962 890,556
1,824,768 1,823,704
CURRENT LIABILITIES
Long-term debt and preferred stock due within one year 91,554 105,114
Short-term borrowings 172,399 170,248
Accounts payable and other accruals 110,148 133,405
Accrued interest 17,903 16,247
Dividends payable 17,717 16,668
Accrued taxes 64,001 15,151
473,722 456,833
OTHER
Deferred income taxes 645,904 652,846
Deferred investment tax credits 49,898 51,211
Trojan decommissioning and transition obligation 376,870 379,179
Miscellaneous 82,738 84,244
1,155,410 1,167,480
$ 3,453,900 $ 3,448,017
The accompanying notes are an integral part of these consolidated
balance sheets.
</TABLE>
11
<PAGE>
PORTLAND GENERAL CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOW FOR THE
THREE MONTHS ENDED MARCH 31, 1996 AND 1995
(UNAUDITED)
<TABLE>
<CAPTION>
Three Months Ended
March 31
<S> <C> <C>
1996 1995
(Thousands of Dollars)
CASH PROVIDED (USED) BY -
OPERATIONS:
Net income $ 49,362 $ (1,954)
Adjustment to reconcile net income to net cash
provided by operations:
Depreciation and amortization 29,113 23,806
Amortization of WNP-3 exchange agreement 1,296 1,228
Amortization of Trojan investment 5,825 6,463
Amortization of Trojan decommissioning 3,510 2,805
Amortization of deferred items - other (1,473) (1,011)
Deferred income taxes - net (4,772) (3,732)
Other noncash revenues (383) (403)
Regulatory disallowance - 36,708
Changes in working capital:
(Increase) Decrease in receivables 404 4,887
(Increase) Decrease in inventories (521) (6,645)
Increase (Decrease) in payables 26,896 24,666
Other working capital items - net (8,538) (11,050)
Trojan decommissioning expenditures (530) (1,374)
Deferred items - other (2,083) 1,504
Miscellaneous - net 4,704 2,813
102,810 78,711
INVESTING ACTIVITIES:
Utility construction - new resources (11) (15,959)
Utility construction - other (33,274) (28,434)
Energy efficiency programs (2,711) (3,902)
Rentals received from leveraged leases 5,576 4,423
Nuclear decommissioning trust deposits (4,439) (2,805)
Nuclear decommissioning trust withdrawals 1,356 4,938
Other (7,008) 5,216
(40,511) (36,523)
FINANCING ACTIVITIES:
Short-term borrowings - net 2,151 (23,627)
Borrowings from Corporate Owned Life Insurance 1,312 2,589
Long-term debt issued 35,000 -
Long-term debt retired (82,595) (3,045)
Repayment of nonrecourse borrowings for
leveraged leases (4,874) (3,871)
Common stock issued 1,433 2,349
Dividends paid (15,303) (15,068)
(62,876) (40,673)
INCREASE (DECREASE) IN CASH AND
CASH EQUIVALENTS (577) 1,515
CASH AND CASH EQUIVALENTS AT THE BEGINNING
OF PERIOD 11,919 17,542
CASH AND CASH EQUIVALENTS AT THE END
OF PERIOD $ 11,342 $ 19,057
Supplemental disclosures of cash flow
information
Cash paid during the period:
Interest, net of amounts capitalized $ 16,901 $ 15,403
Income taxes - -
The accompanying notes are an integral part of these consolidated statements.
</TABLE>
12
<PAGE>
PORTLAND GENERAL CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
NOTE 1
PRINCIPLES OF INTERIM STATEMENTS
The interim financial statements have
been prepared by Portland General and, in
the opinion of management, reflect all
material adjustments which are necessary
to a fair statement of results for the
interim period presented. Certain
information and footnote disclosures made
in the last annual report on Form 10-K
have been condensed or omitted for the
interim statements. Certain costs are
estimated for the full year and allocated
to interim periods based on the estimates
of operating time expired, benefit
received or activity associated with the
interim period. Accordingly, such costs
are subject to year-end adjustment. It
is Portland General's opinion that, when
the interim statements are read in
conjunction with the 1995 Annual Report
on Form 10-K, the disclosures are
adequate to make the information
presented not misleading.
RECLASSIFICATIONS
Certain amounts in prior years have been
reclassified for comparative purposes.
NOTE 2
LEGAL MATTERS
BONNEVILLE PACIFIC CLASS ACTION AND
LAWSUIT
In April 1992 legal action was filed by
Bonneville Pacific against Portland
General, Portland General Holdings, Inc.
(Holdings), and certain individuals
affiliated with Portland General and
Holdings alleging breach of fiduciary
duty, tortious interference, breach of
contract, and other actionable wrongs
related to Holdings' investment in
Bonneville Pacific. Following his
appointment, the Bonneville Pacific
bankruptcy trustee, on behalf of
Bonneville Pacific, filed numerous
amendments to the complaint. The
complaint now includes allegations of
RICO violations and RICO conspiracy,
collusive tort, civil conspiracy, common
law fraud, negligent misrepresentation,
breach of fiduciary duty, liability as a
partner for the debts of a partnership,
and other actionable wrongs. The amount
of damages sought is not specified in the
complaint. The Court has rejected the
Trustee's previously filed damage study
which is expected to be revised and
refiled.
OTHER LEGAL MATTERS
Portland General and certain of its
subsidiaries are party to various other
claims, legal actions and complaints
arising in the ordinary course of
business. These claims are not
considered material.
SUMMARY
While the ultimate disposition of these
matters may have an impact on the results
of operations for a future reporting
period, management believes, based on
discussion of the underlying facts and
circumstances with legal counsel, that
these matters will not have a material
adverse effect on the financial condition
of Portland General.
13
<PAGE>
PORTLAND GENERAL CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
NOTE 3 - TROJAN NUCLEAR PLANT
INVESTMENT RECOVERY
On April 4, 1996 a circuit court judge in
Marion County, Oregon contradicted a
November 1994 ruling from the same court,
finding that the OPUC could not authorize
PGE to collect a return on its
undepreciated investment in Trojan
currently in PGE's rate base. The ruling
was the result of an appeal of PGE's 1995
general rate order which granted PGE
recovery of, and a return on, 87% of its
remaining investment in Trojan.
The November 1994 ruling, by a different
judge of the same court, upheld the
Commission's 1993 Declaratory Ruling (DR-
10). In DR-10 the OPUC ruled that PGE
could recover and earn a return on its
undepreciated Trojan investment, provided
certain conditions were met. The
Commission relied on a 1992 Oregon
Department of Justice opinion issued by
the Attorney General's office stating
that the Commission had the authority to
set prices including recovery of and on
investment in plant that is no longer in
service.
The 1994 ruling was appealed to the
Oregon Court of Appeals and stayed
pending the appeal of the Commission's
March 1995 order. PGE has appealed the
April 1996 ruling which will likely be
combined with the appeal of the November
1994 ruling at the Oregon Court of
Appeals.
Management believes that the authorized
recovery of the Trojan investment and
decommissioning costs will be upheld and
that these legal challenges will not have
a material adverse impact on the results
of operations or financial condition of
the Company for any future reporting
period.
14
<PAGE>
PORTLAND GENERAL ELECTRIC COMPANY AND SUBSIDIARIES
FINANCIAL STATEMENTS AND RELATED INFORMATION
TABLE OF CONTENTS
PAGE
NUMBER
Management Discussion and Analysis of
Financial Condition and Results of Operations* 3-10
Financial Statements 16-18
Notes to Financial Statements** 13-14
* The discussion is substantially the same as that disclosed by
Portland General and, therefore, is incorporated by reference
to the information on the page numbers listed above.
** The notes are substantially the same as those disclosed by
Portland General and are incorporated by reference to the
information on the page numbers shown above, excluding the
Bonneville Pacific litigation discussion contained in Note 2
which relates solely to Portland General.
15
<PAGE>
Portland General Electric Company and Subsidiaries
CONSOLIDATED STATEMENTS OF INCOME FOR THE
THREE MONTHS ENDED MARCH 31, 1996 AND 1995
(UNAUDITED)
<TABLE>
<CAPTION>
Three Months Ended
<S> <C> <C>
March 31
1996 1995
(Thousands of Dollars)
OPERATING REVENUES $ 300,195 $ 258,891
OPERATING EXPENSES
Purchased power and fuel 82,297 87,696
Production and distribution 21,952 15,153
Maintenance and repairs 13,249 9,933
Administrative and other 27,070 24,817
Depreciation and amortization 37,512 31,437
Taxes other than income taxes 14,847 13,721
Income taxes 36,452 26,746
233,379 209,503
NET OPERATING INCOME 66,816 49,388
OTHER INCOME (DEDUCTIONS)
Regulatory disallowance - net of income taxes of $25,542 in 1995 - (36,708)
Allowance for equity funds used during construction - 121
Other 1,748 4,690
Income taxes 323 (344)
2,071 (32,241)
INTEREST CHARGES
Interest on long-term debt and other 16,537 16,347
Interest on short-term borrowings 2,488 2,187
Allowance for borrowed funds used during construction (242) (2,027)
18,783 16,507
NET INCOME 50,104 640
PREFERRED DIVIDEND REQUIREMENT 986 2,583
INCOME/(LOSS) AVAILABLE FOR COMMON STOCK $ 49,118 $ (1,943)
COMMON STOCK
CONSOLIDATED STATEMENTS OF RETAINED EARNINGS FOR THE
THREE MONTHS ENDED MARCH 31, 1996 AND 1995
(Unaudited)
Three Months Ended
March 31
1996 1995
(Thousands of Dollars)
BALANCE AT BEGINNING OF PERIOD $ 246,282 $ 216,468
NET INCOME 50,104 640
ESOP TAX BENEFIT AND OTHER (530) (474)
295,856 216,634
DIVIDENDS DECLARED
Common stock 14,966 11,545
Preferred stock 986 2,583
15,952 14,128
BALANCE AT END OF PERIOD $ 279,904 $ 202,506
The accompanying notes are an integral part of these consolidated statements.
</TABLE>
16
<PAGE>
PORTLAND GENERAL ELECTRIC COMPANY AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
AS OF MARCH 31, 1996 AND DECEMBER 31, 1995
<TABLE>
<CAPTION>
(Unaudited)
<S> <C> <C>
March 31 December 31
1996 1995
(Thousands of Dollars)
ASSETS
ELECTRIC UTILITY PLANT - ORIGINAL COST
Utility plant (includes Construction Work in Progress of
$43,483 and $33,382) $ 2,785,437 $ 2,754,280
Accumulated depreciation (1,066,333) (1,040,014)
1,719,104 1,714,266
Capital leases - less amortization of $28,508 and $27,966 8,810 9,353
1,727,914 1,723,619
OTHER PROPERTY AND INVESTMENTS
Trojan decommissioning trust, at market value 71,204 68,774
Corporate owned life insurance, less loans of $27,763 and $26,432 43,853 44,635
Other investments 31,156 24,943
146,213 138,352
CURRENT ASSETS
Cash and cash equivalents 9,141 2,241
Accounts and notes receivable 110,001 102,592
Unbilled and accrued revenues 58,202 64,516
Inventories, at average cost 38,859 38,338
Prepayments and other 24,356 15,619
240,559 223,306
DEFERRED CHARGES
Unamortized regulatory assets
Trojan investment 295,577 301,023
Trojan decommissioning 306,768 311,403
Income taxes recoverable 213,842 217,366
Debt reacquisition costs 29,929 29,576
Energy efficiency programs 79,074 77,945
Other 27,126 27,611
WNP-3 settlement exchange agreement 167,103 168,399
Miscellaneous 27,573 26,997
1,146,992 1,160,320
$ 3,261,678 $ 3,245,597
CAPITALIZATION AND LIABILITIES
CAPITALIZATION
Common stock equity
Common stock, $3.75 par value per share, 100,000,000 shares
authorized, 42,758,877 shares outstanding $ 160,346 $ 160,346
Other paid-in capital - net 468,043 466,325
Retained earnings 279,904 246,282
Cumulative preferred stock
Subject to mandatory redemption 30,000 40,000
Long-term debt 865,962 890,556
1,804,255 1,803,509
CURRENT LIABILITIES
Long-term debt and preferred stock due within one year 61,554 75,114
Short-term borrowings 172,399 170,248
Accounts payable and other accruals 111,526 132,064
Accrued interest 17,703 15,442
Dividends payable 16,239 14,956
Accrued taxes 66,877 12,870
446,298 420,694
OTHER
Deferred income taxes 520,399 525,391
Deferred investment tax credits 49,898 51,211
Trojan decommissioning and transition costs 376,870 379,179
Miscellaneous 63,958 65,613
1,011,125 1,021,394
$ 3,261,678 $ 3,245,597
The accompanying notes are an integral part of these consolidated balance sheets.
</TABLE>
17
<PAGE>
PORTLAND GENERAL ELECTRIC COMPANY AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOW FOR THE
THREE MONTHS ENDED MARCH 31, 1996 AND 1995
(Unaudited)
<TABLE>
<CAPTION>
Three Months Ended
<S> <C> <C>
March 31
1996 1995
(Thousands of Dollars)
CASH PROVIDED (USED IN)
OPERATIONS:
Net Income $ 50,104 $ 640
Non-cash items included in net income:
Depreciation and amortization 29,092 23,785
Amortization of WNP-3 exchange agreement 1,296 1,228
Amortization of Trojan investment 5,825 6,463
Amortization of Trojan decommissioning 3,510 2,805
Amortization of deferred items - other (1,473) (1,011)
Deferred income taxes - net (2,600) (28)
Other noncash revenues - (121)
Regulatory disallowance - 36,708
Changes in working capital:
(Increase) Decrease in receivables (1,589) 3,661
(Increase) Decrease in inventories (521) (6,645)
Increase (Decrease) in payables 35,447 28,969
Other working capital items - net (8,737) (11,839)
Trojan decommissioning expenditures (530) (1,374)
Deferred items - other (2,083) 1,504
Miscellaneous - net 4,047 2,171
111,788 86,916
INVESTING ACTIVITIES:
Utility construction - new resources (11) (15,959)
Utility construction - other (33,274) (28,434)
Energy efficiency programs (2,711) (3,902)
Nuclear decommissioning trust deposits (4,439) (2,805)
Nuclear decommissioning trust withdrawals 1,356 4,938
Other investments (7,008) (501)
(46,087) (46,663)
FINANCING ACTIVITIES:
Short-term debt - net 2,151 (23,608)
Borrowings from Corporate Owned Life Insurance 1,312 2,589
Long-term debt issued 35,000 -
Long-term debt retired (82,595) (3,045)
Dividends paid (14,669) (15,409)
(58,801) (39,473)
INCREASE (DECREASE) IN CASH AND
CASH EQUIVALENTS 6,900 780
CASH AND CASH EQUIVALENTS AT THE BEGINNING
OF PERIOD 2,241 9,590
CASH AND CASH EQUIVALENTS AT THE END
OF PERIOD $ 9,141 $ 10,370
Supplemental disclosures of cash flow information
Cash paid during the period:
Interest, net of amounts capitalized $ 15,713 $ 14,178
Income taxes (7,437) (697)
The accompanying notes are an integral part of these consolidated statements.
</TABLE>
18
<PAGE>
PORTLAND GENERAL CORPORATION AND SUBSIDIARIES
PORTLAND GENERAL ELECTRIC COMPANY AND SUBSIDIARIES
PART II. OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS
For further information, see Portland General's and PGE's reports on
Form 10-K for the year ended December 31, 1995.
UTILITY
SOUTHERN CALIFORNIA EDISON COMPANY V. PGE, U.S. DISTRICT COURT FOR THE
DISTRICT OF OREGON
On March 29, 1996 PGE and SCE reached a settlement (Termination Agreement)
in the complaint filed by SCE regarding a long-term power sale and
exchange agreement (Power Agreement). The
complaint filed in August 1994 claimed that PGE's closure of the
Trojan Nuclear Plant allowed SCE to terminate the contract. The settlement
will amend and ultimately terminate the long-term contract. If approved by
FERC and the California Public Utility Commission the Termination
Agreement will release all previous claims asserted in the legal dispute.
Until termination, SCE will continue to make annual payments under the
Power Agreement of $16.9 million to PGE. Upon approval of the
settlement and termination of the long-term agreement, SCE's annual
payments under the Termination Agreement will be $15 million through
1999 and $32 million from 2000 through 2002.
CITIZENS' UTILITY BOARD OF OREGON V. PUBLIC UTILITY COMMISSION OF OREGON
and UTILITY REFORM PROJECT AND COLLEEN O'NEIL V. PUBLIC UTILITY COMMISSION
OF OREGON, MARION COUNTY OREGON CIRCUIT COURT
On April 4, 1996 a circuit court judge in Marion County, Oregon contradicted
a November 1994 ruling from the same court, finding that the OPUC
could not authorize PGE to collect a return on its undepreciated
investment in Trojan currently in PGE's rate base. The ruling
was the result of an appeal of PGE's 1995 general rate order which
granted PGE recovery of, and a return on, 87% of its remaining investment in
Trojan.
The November 1994 ruling, by a different judge of the same court,
upheld the Commission's 1993 Declaratory Ruling (DR-10). In DR-10
the OPUC ruled that PGE could recover and earn a return on its
undepreciated Trojan investment, provided certain conditions were
met. The Commission relied on a 1992 Oregon Department of
Justice opinion issued by the Attorney General's office stating
that the Commission had the authority to set prices including
recovery of and on investment in plant that is no longer in service.
The 1994 ruling was appealed to the Oregon Court of Appeals and
stayed pending the appeal of the Commission's March 1995 order. PGE
has appealed the April 1996 ruling which will likely be combined with
the appeal of the November 1994 ruling at the Oregon Court of
Appeals.
PORTLAND GENERAL ELECTRIC COMPANY V. WESTINGHOUSE ELECTRIC CORPORATION,
U.S. DISTRICT COURT FOR THE WESTERN DISTRICT OF PENNSYLVANIA
PGE and Westinghouse Electric Corporation have reached a settlement in
PGE's 1993 lawsuit against Westinghouse regarding steam generators supplied
by Westinghouse to Trojan. Terms of the settlement are confidential.
19
<PAGE>
PORTLAND GENERAL CORPORATION AND SUBSIDIARIES
PORTLAND GENERAL ELECTRIC COMPANY AND SUBSIDIARIES
PART II. OTHER INFORMATION
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
a. Exhibits
NUMBER EXHIBIT PGC PGE
10 Officers Employment Agreement (Form of) X X
27 Financial Data Schedule - UT X X
(Electronic Filing Only)
b. Reports on Form 8-K
March 29, 1996 - Item 5. Other Events: Litigation Settlement
reached with Southern California Edison.
April 4, 1996 - Item 5. Other Events: Marion County Circuit
Court ruling on Trojan investment recovery.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrants have duly caused this report to be signed on their behalf by
the undersigned hereunto duly authorized.
PORTLAND GENERAL CORPORATION
PORTLAND GENERAL ELECTRIC COMPANY
(Registrants)
May 3, 1996 By /S/ JOSEPH M. HIRKO
Joseph M. Hirko
Sr. Vice President,
Chief Financial Officer
20
<PAGE>
WARNING: THE EDGAR SYSTEM ENCOUNTERED ERROR(S) WHILE PROCESSING THIS SCHEDULE.
<TABLE> <S> <C>
<ARTICLE> UT
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED
FROM THE CONSOLIDATED FINANCIAL STATEMENTS FILED ON FORM 10-Q
FOR THE PERIOD ENDED MARCH 31, 1996 FOR PORTLAND GENERAL CORPORATION
AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL
STATEMENTS.
</LEGEND>
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1996
<PERIOD-END> MAR-31-1996
<BOOK-VALUE> PER-BOOK
<TOTAL-NET-UTILITY-PLANT> 1,727,914
<OTHER-PROPERTY-AND-INVEST> 332,981
<TOTAL-CURRENT-ASSETS> 244,125
<TOTAL-DEFERRED-CHARGES> 1,148,880
<OTHER-ASSETS> 0
<TOTAL-ASSETS> 3,453,900
<COMMON> 191,628
<CAPITAL-SURPLUS-PAID-IN> 576,104
<RETAINED-EARNINGS> 161,074
<TOTAL-COMMON-STOCKHOLDERS-EQ> 928,806
30,000
0
<LONG-TERM-DEBT-NET> 859,640
<SHORT-TERM-NOTES> 0
<LONG-TERM-NOTES-PAYABLE> 0
<COMMERCIAL-PAPER-OBLIGATIONS> 172,399
<LONG-TERM-DEBT-CURRENT-PORT> 89,066
0
<CAPITAL-LEASE-OBLIGATIONS> 6,322
<LEASES-CURRENT> 2,488
<OTHER-ITEMS-CAPITAL-AND-LIAB> 1,365,179
<TOT-CAPITALIZATION-AND-LIAB> 3,453,900
<GROSS-OPERATING-REVENUE> 300,581
<INCOME-TAX-EXPENSE> 36,228
<OTHER-OPERATING-EXPENSES> 197,609
<TOTAL-OPERATING-EXPENSES> 233,837
<OPERATING-INCOME-LOSS> 66,744
<OTHER-INCOME-NET> 3,372
<INCOME-BEFORE-INTEREST-EXPEN> 70,116
<TOTAL-INTEREST-EXPENSE> 19,768
<NET-INCOME> 50,348
986
<EARNINGS-AVAILABLE-FOR-COMM> 49,362
<COMMON-STOCK-DIVIDENDS> 16,352
<TOTAL-INTEREST-ON-BONDS> 65,416<F1>
<CASH-FLOW-OPERATIONS> 102,810
<EPS-PRIMARY> 0.97
<EPS-DILUTED> 0.97
<FN>
<F1>REPRESENTS THE 12 MONTH-TO-DATE FIGURE ENDING MARCH 31, 1996.
</FN>
</TABLE>
WARNING: THE EDGAR SYSTEM ENCOUNTERED ERROR(S) WHILE PROCESSING THIS SCHEDULE.
<TABLE> <S> <C>
<ARTICLE> UT
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED
FROM THE CONSOLIDATED FINANCIAL STATEMENTS FILED ON FORM 10-Q
FOR THE PERIOD ENDED MARCH 31, 1996 FOR PORTLAND GENERAL ELECTRIC
COMPANY AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL
STATEMENTS.
</LEGEND>
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1996
<PERIOD-END> MAR-31-1996
<BOOK-VALUE> PER-BOOK
<TOTAL-NET-UTILITY-PLANT> 1,727,914
<OTHER-PROPERTY-AND-INVEST> 146,213
<TOTAL-CURRENT-ASSETS> 240,559
<TOTAL-DEFERRED-CHARGES> 1,146,992
<OTHER-ASSETS> 0
<TOTAL-ASSETS> 3,261,678
<COMMON> 160,346
<CAPITAL-SURPLUS-PAID-IN> 468,043
<RETAINED-EARNINGS> 279,904
<TOTAL-COMMON-STOCKHOLDERS-EQ> 908,293
30,000
0
<LONG-TERM-DEBT-NET> 859,640
<SHORT-TERM-NOTES> 0
<LONG-TERM-NOTES-PAYABLE> 0
<COMMERCIAL-PAPER-OBLIGATIONS> 172,399
<LONG-TERM-DEBT-CURRENT-PORT> 59,066
0
<CAPITAL-LEASE-OBLIGATIONS> 6,322
<LEASES-CURRENT> 2,488
<OTHER-ITEMS-CAPITAL-AND-LIAB> 1,233,470
<TOT-CAPITALIZATION-AND-LIAB> 3,261,678
<GROSS-OPERATING-REVENUE> 300,195
<INCOME-TAX-EXPENSE> 36,452
<OTHER-OPERATING-EXPENSES> 196,927
<TOTAL-OPERATING-EXPENSES> 233,379
<OPERATING-INCOME-LOSS> 66,816
<OTHER-INCOME-NET> 2,071
<INCOME-BEFORE-INTEREST-EXPEN> 68,887
<TOTAL-INTEREST-EXPENSE> 18,783
<NET-INCOME> 50,104
986
<EARNINGS-AVAILABLE-FOR-COMM> 49,118
<COMMON-STOCK-DIVIDENDS> 14,966
<TOTAL-INTEREST-ON-BONDS> 62,989<F1>
<CASH-FLOW-OPERATIONS> 111,788
<EPS-PRIMARY> 0<F2>
<EPS-DILUTED> 0<F2>
<FN>
<F1>REPRESENTS THE 12 MONTH-TO-DATE FIGURE ENDING MARCH 31, 1996.
<F2>PORTLAND GENERAL ELECTRIC COMPANY IS A WHOLLY-OWNED SUBSIDIARY OF
PORTLAND GENERAL CORPORATION AND AS SUCH ITS COMMON STOCK IS NOT
PUBLICALLY TRADED. PGE DOES NOT REPORT EPS INFORMATION.
</FN>
</TABLE>
EMPLOYMENT AGREEMENT
This Employment Agreement ("Agreement") is dated as of
__________________________ , 1996 and is entered into by and
between _______________, ("Employee") and Portland General Corporation, an
Oregon corporation ("PGC"). The term "Employer" as used herein shall
include PGC, Portland General Electric Company ("PGE"), and any present
or future parent or subsidiary corporation of PGC or PGE or any successor
to such corporations. IT IS MUTUALLY AGREED THAT UPON ITS EXECUTION THIS
AGREEMENT TERMINATES AND SUPERSEDES THAT CERTAIN CHANGE IN CONTROL SEVERANCE
AGREEMENT EXECUTED BY EMPLOYEE AND PGC OR ABOUT NOVEMBER 30, 1994. Employee
and Employer hereby agree that Employee will render services to Employer on
the following terms and conditions:
1. EMPLOYMENT. Upon the terms and subject to the conditions contained
herein, during the term of this Agreement, Employer hereby agrees to
employ Employee to provide full-time services for Employer. During
the term hereof, Employee agrees to devote his or her best efforts to
the business of Employer, and shall perform his or her duties in a
diligent, trustworthy, businesslike manner, all for the purpose of
advancing the business of Employer.
2. DUTIES. The duties of Employee shall be those duties which can
reasonably be expected to be performed by a person with the title of
Chairman of the Board and President. Except as provided in Paragraph
10 of this Agreement, Employee's duties may, from time to time, be
changed or modified at the discretion of the Chief Executive Officer
or the Board of Directors of Employer.
3. SALARY AND BENEFITS. Employer shall, during the term of this
Agreement, pay Employee a base salary, which shall initially be the
salary in effect on the date of this Agreement. Such salary shall be
paid in semimonthly installments less applicable withholding and
applicable salary deferrals and reductions. Employer may, in its
discretion, periodically increase the base salary and/or grant a bonus
or other compensation or benefits to Employee, during the term of this
Agreement. Employer may not, however, reduce Employee's base salary
during the term of this Agreement. Employee shall be entitled to
participate in the employee benefit programs generally available to
employees of Employer.
4. TERM OF AGREEMENT. This Agreement shall be effective beginning on
the date of this Agreement and shall continue until either party, in
its sole discretion and for any reason, provides written notice of
termination to the other party. Such termination will be effective no
earlier than the first business day of the 12th month following the
notice so that, for example, a notice delivered on September 1, 1996
would terminate this Agreement no earlier than September 1, 1997.
Notwithstanding the preceding sentences, and except as otherwise
provided in Paragraph 9, this Agreement shall terminate on the
Employee's last
Page 1
<PAGE>
day of employment if the Employee voluntarily terminates for any
reason or is terminated by Employer for a reason described in
Paragraph 5.
5. TERMINATION. During the term of this Agreement, and except as
otherwise provided in Paragraph 10 of this Agreement, the parties
agree that Employer may terminate the employment of the Employee only
for "Cause" or for breach of the provisions of Paragraph 8 or as set
forth in Paragraph 9. Cause for termination shall be limited to the
following: (1) Employee engages in an act of dishonesty or moral
turpitude (including but not limited to conviction of a felony) which
materially injures or damages Employer, (2) Employee willfully fails
to substantially perform his or her duties hereunder and such willful
failure results in demonstrable material injury and damage to
Employer, (3) it is determined that Employee has misrepresented or
concealed a material fact for the purpose of securing employment or
this Employment Agreement, or (4) Employee's performance is
substantially below the standard of performance which can reasonably
be expected from an individual occupying Employee's position or
Employee substantially fails to meet performance objectives, including
without limitation Guiding Behaviors, which have been previously
agreed to between Employee and Employer, such as performance
objectives relating to profit.
6. REMEDY FOR BREACH. In the event that Employer breaches this
Agreement by terminating the employment of Employee other than
pursuant to Paragraph 5 during the term of this Agreement, and
provided that Employee executes a release agreement in the form
attached hereto as Exhibit A, Employer agrees to pay to Employee, as
liquidated damages and not as a penalty for such breach, a sum of
money equal to Employee's monthly base salary multiplied by twenty
four (24). Employee agrees that such liquidated damages shall be
Employee's sole remedy and relief in the event that Employer breaches
this Agreement by terminating the employment of Employee other than
pursuant to Paragraph 5. Unless Employer determines in its complete
discretion to pay such amount more quickly, liquidated damages owed to
Employee shall be paid at the same time and in the same manner as
Employee's previous salary had been paid. Notwithstanding the
foregoing, Employee shall no longer be treated as employed by
Employer. By signing the Agreement Employee agrees that the payments
to which Employee may become entitled under this paragraph are in lieu
of any other payments to which Employee might be entitled and that
Employer's discharge of its obligations under this paragraph shall
constitute full satisfaction of any and all claims of any nature
whatsoever that Employee might otherwise possess against Employer and
its subsidiaries, except (1) such claims as are specifically provided
for in the terms of any generally applicable employee benefit or
executive compensation plans evidenced by written agreements or (2)
any claims for personal injuries (other than claims that are based on
or relate to a contention that Employer has wrongfully discharged
Employee).
Page 2
<PAGE>
7. SUCCESSORS. The rights and obligations of Employer under this
Agreement shall inure to the benefit of and shall be binding upon the
successors and assigns of Employer. PGC will require any successor
(whether direct or indirect, by purchase, merger, consolidation or
otherwise) to all or substantially all of the business and/or assets
of PGC or PGE to expressly assume and agree to perform this Agreement
in the same manner and to the same extent that PGC or PGE would be
required to perform it if no such succession had taken place. Failure
of PGC or PGE to obtain such assumption and agreement prior to the
effectiveness of any such succession shall be a breach of this
Agreement and shall entitle the Employee to compensation from PGC and
PGE in the same amount and on the same terms as the Employee would be
entitled to hereunder upon a termination of employment in violation of
Subparagraph 10(c) following a Change in Control, except that for
purposes of implementing the foregoing, the date on which any such
succession becomes effective shall be deemed the date of termination
of employment. As used in this Agreement, "Employer" shall mean the
Employer as hereinbefore defined and any successor to its business
and/or assets as aforesaid which assumes and agrees to perform this
Agreement by operation of law, or otherwise. This Agreement shall
inure to the benefit of and be enforceable by the Employee's personal
or legal representatives, executors, administrators, successors,
heirs, distributees, devisees and legatees. If the Employee should
die while any amount would still be payable to the Employee hereunder
if the Employee had continued to live, all such amounts, unless
otherwise provided herein, shall be paid in accordance with the terms
of this Agreement to the Employee's devisee, legatee or other designee
or, if there is no such designee, to the Employee's estate.
8. NONCOMPETITION AND CONFIDENTIAL INFORMATION.
(a) NONCOMPETITION. In the event of the voluntary or involuntary
termination of Employee's employment with Employer, Employee
agrees that he will not compete with Employer in business
opportunities specifically identified during the course of his
employment with Employer or Employer transactions which Employer
intended to pursue, and will not attempt to disrupt or damage
Employer's relationships in any existing contractual relations of
Employer, including without limitation, the overt solicitation of
other employees of Employer to leave Employer, for a period of two
(2) years following the termination of his employment.
(b) CONFIDENTIAL INFORMATION
(1) As used in this Agreement, the term "Confidential
Information" means (1) proprietary information of the
Employer, or any other direct or indirect subsidiary of the
Employer (hereinafter in this Paragraph 8 collectively
referred to as "the Employer"); (2) information marked or
designated by the Employer as confidential;
Page 3
<PAGE>
(3) information, whether or not in written form and whether
or not designated as confidential, which is known to Employee
as being treated by the Employer as confidential; and (4)
information provided to the Employer by third parties which
the Employer is obligated to keep confidential. Confidential
Information includes, but is not limited to, trade secrets,
discoveries, ideas, designs, drawings, specifications,
techniques, models, data, programs, documentation, processes,
know-how, customer lists, marketing plans, and financial and
technical information. Confidential Information shall
include all such information coming to the knowledge of
Employee prior to as well as subsequent to the execution of
this Agreement.
(2) Employee hereby acknowledges that all Confidential
Information is and shall continue to be the exclusive
property of the Employer whether or not prepared in whole or
in part by Employee and whether or not disclosed or entrusted
to Employee in connection with Employee's work for the
Employer.
(3) Employee acknowledges that in the course of performing his
duties for the Employer that Employee has and will have
access to Confidential Information, the ownership and
confidential status of which is highly important to the
Employer. Employee agrees, in addition to the specific
covenants contained in this Agreement, to comply with all
Employer policies and procedures for the protection of
Confidential Information.
(4) Employee acknowledges that any disclosure of Confidential
Information will cause substantial harm to the Employer.
(5) Employee agrees not to disclose Confidential Information,
directly or indirectly, under any circumstances or by any
means, to any third person without the express written
consent of the Employer. "Third person" includes, but is not
limited to, independent contractors performing services for
the Employer, unless Employee is informed to the contrary in
writing.
(6) Employee agrees to communicate to the Employer all
information, negotiations, and communications coming to the
knowledge of Employee which if known to the Employer would
confer a competitive advantage to the Employer, and further
that upon its receipt by Employee, such information shall be
regarded as Confidential Information within the terms of this
Agreement.
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(7) Employee agrees not to copy, transmit, reproduce, summarize,
quote, or make any commercial or other use whatsoever of the
Confidential Information, except as may be necessary to
perform Employee's duties for the Employer.
(8) Employee agrees to exercise the highest degree of care in
safeguarding Confidential Information against loss, theft, or
inadvertent disclosure, and agrees generally to take all
steps necessary to ensure the maintenance of confidentiality.
(9) This Agreement shall not apply to any information now or
hereafter voluntarily released by the Employer to the public,
or which otherwise becomes part of the public domain through
lawful means.
(10) Employee agrees that all creative work, including computer
programs or models, prepared or originated by Employee for
the Employer, or during or within the scope of Employee's
employment by the Employer, which may be subject to
protection under federal copyright law, constitutes work made
for hire, all rights to which are owned by the Employer and,
in any event, Employee assigns to the Employer all rights,
title and interest, whether by way of copyright or otherwise,
in all such work, whether or not subject to protection by
copyright laws.
(11) Upon the retirement, voluntary or involuntary termination of
Employee's employment with the Employer, Employee agrees to
deliver promptly to the Employer all Confidential
Information, in whatever form, that may be in Employee's
possession or under Employee's control. Employee also
further agrees that upon retirement, voluntary or involuntary
termination of Employee's employment, Employee will cooperate
with the management of the Employer to achieve a smooth
transition and business continuity.
(12) If Employee is served with any subpoena or other judicial or
administrative process calling for production of Confidential
Information, Employee shall immediately notify the Employer
in order that it may take such action as it deems necessary
to protect its interest.
(c) REMEDIES. Violation of this Paragraph 8 will cause Employee to
immediately forfeit his or her right to any payments under
Paragraph 6 that have not yet been paid. Notwithstanding anything
contained in
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Paragraph 14, Employer shall have the right to file a suit to
enjoin any action of Employee which would constitute a breach of
this Paragraph 8.
9. ILLNESS, INCAPACITY, OR DEATH. In the event of illness or incapacity
of Employee, Employer shall continue Employee's salary for six months
and may, at its sole option, continue payment of Employee's salary
until he or she is able to return to work. If Employee is unable to
work due to illness or incapacity for a period greater than six
months, Employer may elect, in its discretion, to immediately
terminate this Agreement (notwithstanding the terms of Paragraph 4)
and Employee shall be entitled to receive benefits as a disabled
employee under applicable Company plans. If Employee should die
during the term of this Agreement, Employee's employment shall be
treated as terminated and Employer's obligations hereunder shall
terminate as of the end of the month in which Employee's death occurs.
Employee's death during a payout period under Paragraph 6 of this
Agreement shall, however, not be treated the same as a death during
employment, i.e., the obligation to make payments under Paragraph 6
shall not terminate as of the end of the month in which death occurs
but shall continue, and payments shall be made to Employee's estate.
10. CHANGE IN CONTROL. Upon a Change in Control of PGC or PGE, as
defined herein, Employee and Employer agree that, notwithstanding any
provisions to the contrary in this Agreement, the terms and conditions of
this Agreement will be modified as follows:
(a) The term of this Agreement will automatically be extended to the
date three (3) years following the date of the Change in Control
of PGC or PGE, and shall not be terminable by any notice given by
Employer under Paragraph 4, after which this Agreement shall
expire.
(b) During the three (3) year term of this Agreement Employee's duties
shall remain defined as set forth in Paragraph 2 of this
Agreement, or as otherwise modified pursuant to Paragraph 2 prior
to the date of the Change in Control. Following the Change in
Control, Employee's duties may not be reduced and the Employer
shall no longer have the power to reduce, modify, add to, or take
away from the scope of Employee's duties. In addition, Employee
shall be entitled to, short and long term incentives and benefits
under Employer's incentive and benefits programs which are at
least as favorable, in the aggregate, as the most favorable of
those provided to Employee under such programs prior to the Change
in Control. Any breach of this Subparagraph (b) (which shall be
deemed to include the transfer of Employee's job location to a
site different from his or her place of employment prior to the
Change in Control), as determined by Employee in good faith, may
be deemed a material breach of this Agreement, and will entitle
Employee, at his or her election, to terminate this Agreement and
receive damages pursuant to Subparagraphs
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10(c) and 10(d) below, not pursuant to Paragraph 6 of this
Agreement and with no requirement that Employee execute a release.
(c) Upon a Change in Control, Paragraphs 5 of this Agreement shall
have no further force or effect, and the employment of Employee
may be terminated by Employer without causing a breach of the
Agreement only if (1) Employee engages in an act of dishonesty or
moral turpitude (including but not limited to conviction of a
felony) which materially injures or damages Employer or (2)
Employee willfully fails to substantially perform his or her
duties hereunder and such willful failure results in demonstrable
material injury and damage to Employer. The terms of Paragraph 9
shall remain in full force and effect following a Change in
Control. If Employee is terminated for a reason other than one
listed in the first sentence of this Subparagraph 10(c), Employer
shall be treated as having breached this Agreement and Employee
shall be entitled to the payment described in Subparagraph (d)
below (as damages and not as a penalty for such breach). Such
payment shall be paid in a lump sum no later than 10 days
following the date of breach and there shall be no excuse for a
delay in payment. Employer acknowledges and agrees that Employee
shall have no duty to mitigate any damages the Employee may incur
by reason of termination under this Agreement and that Employee
shall be entitled to receive the payments and benefits provided
for in Paragraph 10(d) below regardless of any income which
Executive may receive from other sources after any such
termination nor shall it be offset against any amount claimed to
be owed by the Employee to the Employer.
(d) The amount Employer agrees to pay Employee under this Paragraph 10
shall be equal to the sum of (1),(2)and (3) below:
(1) $30,000 plus three times the sum of (A) the amount of
Employee's annual base salary in effect immediately prior to
Employee's termination of employment and (B) the aggregate of
the amounts of Employee's target Annual Cash Incentive award
for the year in which Employee's employment terminates under
all of Employer's incentive plans or programs in which
Employee was then participating;
(2) the single sum actuarial equivalent of the incremental value
of adding three (3) years of age and three (3) years of
service to Employee's vested accrued benefits under the
Portland General Corporation Supplemental Executive
Retirement Plan ("SERP"); and
(3) upon Employee's election, the single sum actuarial equivalent
of the Employee's vested accrued benefit under the SERP
reduced by six
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(6) percent, such election waiving all further benefits under
the SERP.
In addition to such payment, to the extent that Employee or any of
Employee's dependent's may be covered under the terms of any
medical and dental plans of the Company for active employees
immediately prior to the termination, the Employer will provide
the Employee and those dependents with equivalent coverages for a
period not to exceed thirty-six (36) months from the termination.
The coverages may be procured directly by the Employer apart from,
and outside of the terms of the plans themselves, provided that
the Employee and the Employee's dependents comply with all of the
conditions of the medical or dental plans. In consideration for
these benefits, the Employee must make contributions equal to
those required from time to time from employees for equivalent
coverages under the medical or dental plans.
(e) Following a Change in Control, Employee's base annual salary for
the remaining term of this Agreement shall be no less than his or
her base salary immediately prior to the date of the Change in
Control. Employer may, in its discretion, periodically increase
the base salary and/or grant a bonus or other compensation or
benefits to Employee, during the term of this Agreement. Employer
may not, however, reduce Employee's base salary during the term of
this Agreement.
(f) A "Change in Control"shall occur if during the Term of this
Agreement:
(i) Any "person," as such term is used in Sections 13(d) and
14(d) of the Securities Exchange Act of 1934, as amended (the
"Exchange Act") (other than PGC or PGE, any trustee or other
fiduciary holding securities under an employee benefit plan
of PGC or PGE, or any Employer owned, directly or indirectly,
by the stockholders of PGC or PGE in substantially the same
proportions as their ownership of stock of PGC or PGE), is or
becomes the "beneficial owner" (as defined in Rule 13d-3
under the Exchange Act), directly or indirectly, of
securities representing thirty percent (30%) or more of the
combined voting power of PGC's or PGE's then outstanding
voting securities;
(ii) During any period of two consecutive years (not including any
period prior to the execution of this Agreement), individuals
who at the beginning of such period constitute the Board of
Directors of Portland General Employer ("PGC Board"), and any
new director (other than a director designated by a person
who has entered into an agreement with PGC to effect a
transaction described in clause (a), (c) or (d) of this
Paragraph) whose election by the PGC Board
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or nomination for election by PGC's stockholders was approved
by a vote of at least two-thirds (2/3) of the directors then
still in office who either were directors as of the beginning
of the period or whose election or nomination for election
was previously so approved, cease for any reason to
constitute at least a majority thereof;
(iii) The stockholders of PGC or PGE approve a merger or consolidation
of PGC or PGE with any other corporation, other than (a) a
merger or consolidation which would result in the voting
securities of PGC or PGE outstanding immediately prior thereto
continuing to represent (either by remaining outstanding or by
being converted into voting securities of the surviving entity)
more than 80% of the combined voting power of the voting
securities of PGC or PGE or such surviving entity outstanding
immediately after such merger or consolidation or (b) a merger
or consolidation effected to implement a recapitalization of PGC
or PGE (or similar transaction) in which no "person" (as
hereinabove defined) acquires more than thirty percent (30%) of
the combined voting power of PGC's or PGE's then outstanding
securities; or
(iv) The stockholders of PGC or PGE approve a plan of complete
liquidation of PGC or PGE or an agreement for the sale or
disposition by PGC or PGE of sixty per cent (60%) or more of
PGC's or PGE's assets (including stock of subsidiaries) to a
person or entity that is not a subsidiary or parent
corporation. For purposes of determining whether a sale or
other disposition of sixty percent (60%) of PGE's assets has
occurred, only long term assets shall be considered. Assets
shall not be considered long term assets if they constitute
"regulatory assets," "stranded investments" or abandoned or
non-operational projects. Projects in economy shutdown shall
be considered long term assets.
(g) Paragraph 14 shall no longer apply and the following arbitration
provisions shall apply:
(1) If the Employee, in good faith, believes Employer has failed
to pay or provide payment of any amounts required to be paid
or provided for hereunder at any time, the Employee shall be
entitled to consult with independent counsel, and Employer
agrees to pay the reasonable fees and expenses of such
counsel for the Employee in advising him in connection
therewith or in bringing any proceedings, or in defending any
proceedings, including any appeal arising from any
proceeding, involving the Employee's rights under this
Agreement, such right to reimbursement to be immediate upon
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the presentment by the Employee of written billings of such
reasonable fees and expenses. The Employee shall be entitled
to the prime rate of interest established from time to time
at United States National Bank of Oregon or its successor for
any payments of such expenses, or any other payments under
this Agreement, that are overdue.
(2) Because it is agreed that time will be of the essence in
determining whether any payments are due to Employee under
this Agreement following a Change in Control, Employee may,
if he or she desires, submit any claim for payment under this
Agreement or dispute regarding the interpretation of this
Agreement to arbitration. This right to select arbitration
shall be solely that of Employee and Employee may decide
whether or not to arbitrate in his or her discretion. The
"right to select arbitration" is not mandatory on Employee
and Employee may choose in lieu thereof to bring an action in
an appropriate civil court. Once an arbitration is
commenced, however, it may not be discontinued without the
mutual consent of both parties to the arbitration.
(3) Any claim for arbitration shall be filed in writing with an
arbitrator of Employee's choice who is selected by the method
described in the next four sentences. The first step of the
selection shall consist of Employee submitting a list of five
potential arbitrators to Employer. Each of the five
arbitrators must be either (A) a member of the National
Academy of Arbitrators located in the State of Oregon or (B)
a retired Oregon Federal District Court, Oregon Supreme Court
or Oregon Court of Appeals judge. Within one week after
receipt of the list, Employer shall select one of the five
arbitrators as the arbitrator for the dispute in question.
If Employer fails to select an arbitrator in a timely manner,
Employee shall then designate one of the five arbitrators as
the arbitrator for the dispute in question.
(4) The arbitration hearing shall be held within seven days (or
as soon thereafter as possible) after the picking of the
arbitrator. No continuance of said hearing shall be allowed
without the mutual consent of Employee and Employer. Absence
from or nonparticipation at the hearing by either party shall
not prevent the issuance of an award. Hearing procedures
which will expedite the hearing may be ordered at the
arbitrator's discretion, and the arbitrator may close the
hearing in his or her sole discretion when he or she decides
he or she has heard sufficient evidence to satisfy issuance
of an award.
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(5) The arbitrator's award shall be rendered as expeditiously as
possible and in no event later than one week after the close
of the hearing. In the event the arbitrator finds that
Employer has breached this Agreement, he or she shall order
Employer to immediately take the necessary steps to remedy
the breach. The award of the arbitrator shall be final and
binding upon the parties. The award may be enforced in any
appropriate court as soon as possible after its rendition.
If an action is brought to confirm the award, both Employer
and Employee agree that no appeal shall be taken by either
party from any decision rendered in such action.
(6) Solely for purposes of determining the allocation of the
costs described in this subsection, Employer will be
considered the prevailing party in a dispute if the
arbitrator determines (A) that Employer has not breached this
Agreement and (B) the claim by Employee was not made in good
faith. Otherwise, Employee will be considered the prevailing
party. In the event that Employer is the prevailing party,
the fee of the arbitrator and all necessary expenses of the
hearing (excluding any attorneys' fees incurred by Employer)
including stenographic reporter, if employed, shall be paid
by Employee. In the event that Employee is the prevailing
party, the fee of the arbitrator and all necessary expenses
of the hearing (INCLUDING all attorneys, fees incurred by
Employee in pursuing his or her claim), including the fees of
a stenographic reporter if employed, shall be paid by
Employer.
(h) Paragraph 15 shall be deleted.
(i) Employer agrees that, if Employee is terminated under
circumstances that constitute Employer's breach of this Agreement,
Employer will make no statements with regard to Employee which
might be interpreted to reflect adversely upon his or her job
competency.
(j) Employee shall be entitled to refuse all or any portion of any
payment under this Agreement if he or she determines that receipt
of such payment may result in adverse tax consequences to him or
her. Employer shall be totally and permanently relieved of any
obligation to pay any amount which Employee explicitly so refuses
in writing.
11. CONSULTATION WITH LEGAL COUNSEL. Employee acknowledges that he or
she has been encouraged to consult with legal counsel before signing
this Agreement.
12. GOVERNING LAW. This Agreement is made and entered into in the State
of Oregon, and the laws of Oregon shall govern its validity and
interpretation in
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the performance by the parties hereto of their respective duties and
obligations hereunder.
13. ENTIRE AGREEMENT. This Agreement constitutes the entire, agreement
between the parties respecting the employment of Employee, and there
are no representations, warranties or commitments, other than those
set forth herein. This Agreement may be amended or modified only by
an instrument in writing executed by all of the parties hereto. This
is an integrated agreement.
14. ARBITRATION. Except as otherwise provided in Paragraph 8, any
dispute, controversy, or claim arising out of or relating to this
Agreement or breach thereof, or arising out of or relating in any way
to the employment of the Employee or the termination thereof, shall be
submitted to arbitration in accordance with the Voluntary Labor
Arbitration Rules of the American Arbitration Association. Judgment
upon the award rendered by the arbitrator may be entered in any court
in the State of Oregon, or in any other court of competent
jurisdiction. In reaching his or her decision, the arbitrator shall
have no authority to ignore, change, modify, add to or delete from any
provision of this Agreement, but instead is limited to interpreting
this Agreement.
15. ASSISTANCE IN LITIGATION. Employee shall make himself or herself
available, upon the request of Employer, to testify or otherwise
assist in litigation, arbitration, or other disputes involving
Employer, or any of the directors, officers, employees, subsidiaries,,
or parent corporations of either, (1) during the term of this
Agreement at no additional cost and (2) at any time following the
termination of this Agreement so long as Employee receives a
reasonable fee for his or her services plus reimbursement of out-of-
pocket expenses.
16. NOTICES. Any notice or communications required or permitted to be
given to the parties hereto shall be delivered personally or be sent
by United States registered or certified mail, postage prepaid and
return receipt requested, and addressed or delivered as follows, or to
such other address as the party addressed may have substituted by
notice pursuant to this section:
(a) If to Employer:
Portland General Corporation
121 SW Salmon Street
Portland Oregon 97204
Attn: Vice President of Human Resources
(b) If to Employee:
_________________________________________________________________
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_________________________________________________________________
_________________________________________________________________
17. CAPTIONS. The captions of this Agreement are inserted for
convenience and do not constitute a part hereof.
18. SEVERABILITY. In case any one or more of the provisions contained in
this Agreement shall for any reason be held to be invalid, illegal or
unenforceable in any other respect, such invalidity, illegality or
unenforceability shall not affect any other provision of this
Agreement, but this Agreement shall be construed as if such invalid,
illegal or unenforceable provision had never been contained herein and
there shall be deemed substituted therefor such other provision as
will most nearly accomplish the intent of the parties to the extent
permitted by the applicable law. In case this Agreement, or any one
or more of the provisions hereof, shall be held to be invalid, illegal
or unenforceable within any governmental jurisdiction or subdivision
thereof, this Agreement or any such provision thereof shall not as a
consequence thereof be deemed to be invalid, illegal or unenforceable
in any other governmental jurisdiction or subdivision thereof.
19. COUNTERPARTS. This Agreement may be executed simultaneously in two
or more counterparts, each of which shall be deemed an original, but
all of which shall together constitute one and the same Agreement.
IN WITNESS HEREOF, the parties hereto have caused this Agreement to be
duly executed and delivered as of the day and year first written above in
Portland, Oregon.
EXECUTED: ______________________, 19_____.
Portland General Corporation
By _______________________________________________________________________
EXECUTED: ______________________, 19_____.
By _______________________________________________________________________
[Name of Employee]
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EXHIBIT A
Form of Release
In consideration of the payments being provided to me pursuant to the
certain Employment Agreement dated ____________________,
I, ___________________________, hereby release, acquit, and forever
discharge, and covenant not to sue or pursue, either individually or as
part of a class, any claim as described below, against Portland General
Corporation ("PGC"), Portland General Electric Company ("PGE"), or any of
their affiliated corporations or divisions, or any of their respective
past, present, and future directors, officers, employees, agents,
contractors, and insurers, and their successors, individually or
collectively, any person who might be entitled to claim indemnity from any
of the aforementioned under contract or law, or any and all other persons
or entities who might be claimed to be liable for actions of any of the
aforementioned entities.
This release and covenant not to sue is intended to apply to any and all
claims and liabilities of every nature and kind in any way related to or
arising out of my employment with PGC or PGE, or which might be asserted
under local, state, or federal authorities, including but not limited to
claims for additional compensation, benefits, reinstatement, reemployment,
injunctive relief, reasonable accommodation, damages of any nature,
penalties, or attorneys' fees, including but not limited to any and all
claims based upon the Oregon statutes dealing with employment matters (ORS
652, 653, and 659), Title VII of the Civil Rights Act of 1964; the Fair
Labor Standards Act; the Equal Pay Act of 1963; the Age Discrimination in
Employment Act of 1967; the Older Workers Benefit Protection Act of 1990;
the Civil Rights Act of 1866 and 1871 (42 USC 1981-1988), the Civil Rights
Act of 1991; the Employment Retirement Income Security Act ("ERISA"); the
Rehabilitation Act of 1973; the Vietnam Era Veterans Readjustment
Assistance Act of 1974; Uniformed Services Employment and Reemployment
Rights Act of 1994; the Energy Reorganization Act of 1974; the Americans
With Disabilities Act of 1990; the Worker Adjustment and Retraining
Notification Act; and Executive Order 11246, all as amended, all
regulations under such authorities, and any contract (either expressed or
implied, oral or written), tort, or other common law theory which might
apply.
I represent that I have not filed any complaints, charges, or lawsuits
against PGC, PGE, or any of their affiliated corporations or divisions,
either individually or as part of a class, with any governmental agency or
court with respect to any matter released herein, and that I will not do
so at any time hereafter.
I am currently unaware of any claim, right, demand, debt, action,
obligation, liability, or cause of action that I may have against PGC,
PGE, or any of their affiliated corporations or divisions, either
individually or as part of a class, which has not been released in this
agreement. I expressly agree that this is a full and final release
covering all unknown, undisclosed, and unanticipated losses, wrongs,
claims, or
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damages I may have against the PGC, PGE, or any of their affiliated
corporations or divisions, which may have arisen from any act or omission
prior to the later of the effective date of this agreement or my
termination of employment, arising out of or related to my employment or
the termination thereof.
Notwithstanding anything that may be construed to the contrary in the
previous paragraphs, I understand that nothing in this agreement shall be
construed to prohibit me from reporting any suspected instance of illegal
activity of any nature, any nuclear safety concern, any workplace safety
concern, or any public safety concern, to the United States Nuclear
Regulatory Commission, the United States Department of Labor, or any other
federal or state governmental agency, and shall not be construed to
prohibit me from participating in any way in any state or federal
administrative, judicial, or legislative proceeding or investigation with
respect to any illegal activity of any nature, any nuclear safety concern,
any workplace safety concern, or any public safety concern, not
constituting the reassertion of claims and matters resolved and terminated
by the preceding paragraphs.
Please write below on the lines provided: "I am entering into this
Release voluntarily with full understanding of its effect".
__________________________________________________________________________
__________________________________________________________________________
__________________________________________________________________________
This agreement was first presented to ____________ for consideration on
___________.
WE ADVISE THAT YOU SEEK THE ADVICE OF A LAWYER BEFORE SIGNING THIS
AGREEMENT. YOU HAVE FORTY-FIVE (45) DAYS TO CONSIDER THIS AGREEMENT
BEFORE SIGNING.
You have seven (7) days to revoke following execution of this agreement.
The agreement will not be effective or enforceable until seven (7) days
have expired from the day you sign it.
PORTLAND GENERAL CORPORATION EMPLOYEE
By: ___________________________ _______________________________________
Date: ________________________ Date: ________________________________
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