PORTLAND GENERAL CORPORATION
OUTSIDE DIRECTORS' LIFE INSURANCE BENEFIT PLAN
1996 RESTATEMENT
Effective January 1, 1996
TABLE OF CONTENTS
PAGE
ARTICLE I - PURPOSE 1
1.1 Purpose 1
1.2 Effective Date 1
ARTICLE II - DEFINITIONS 1
2.1 Board 1
2.2 Cash Value 1
2.3 Cause 1
2.4 Change in Control 1
2.5 Committee 2
2.6 Company 2
2.7 Date of Participation 2
2.8 Direct Subsidiary 3
2.9 Indirect Subsidiary 3
2.10 Insurer 3
2.11 Net Single Premium 3
2.12 Outside Director 3
2.13 Participant 3
2.14 Participant's Share 3
2.15 Participating Company 3
2.16 Participating Company's Share of Premium 4
2.17 Plan 4
2.18 Policy 4
2.19 Retirement 4
2.20 Senior Administrative Officer 4
ARTICLE III - PARTICIPATION 4
3.1 Eligibility 4
3.2 Election to Participate 4
ARTICLE IV - POLICY TITLE AND OWNERSHIP 4
4.1 Policy Title 4
4.2 Participating Company's Security Interest 5
ARTICLE V - PREMIUM PAYMENT 5
5.1 Participating Company's Premium Payment 5
5.2 Payment of the Participant's Share 5
(i)
TABLE OF CONTENTS
PAGE
ARTICLE VI - PARTICIPATING COMPANY'S INTEREST IN THE POLICY 5
6.1 Collateral Assignment 5
6.2 Limitations 5
ARTICLE VII - PARTICIPANT'S INTEREST IN THE POLICY 6
7.1 Upon Surrender or Cancellation 6
7.2 Upon Death 6
7.3 Ownership of Cash Surrender Value 6
ARTICLE VIII - PLAN BENEFITS 6
8.1 Upon Termination of Participation in the Plan 6
8.2 Upon Termination of Service 6
8.3 Upon Change in Control 7
8.4 Upon Retirement 7
8.5 Timely Transfer of Ownership 7
ARTICLE IX - DURATION OF THE PLAN 7
9.1 Plan Continuation 7
9.2 Termination of Arrangement 8
ARTICLE X - AMENDMENT AND TERMINATION OF PLAN 8
10.1 Amendment 8
10.2 Termination 8
ARTICLE XI - INSURER NOT A PARTY TO PLAN 8
ARTICLE XII - NAMED FIDUCIARY 8
12.1 Senior Administrative Officer; Committee 8
12.2 Indemnity of Senior Administrative Officer; Committee 9
12.3 Availability of Plan Documents 9
12.4 Cost of Plan Administration 9
ARTICLE XIII - CLAIMS PROCEDURE 9
13.1 Claim 9
13.2 Denial of Claim 9
13.3 Review of Claim 9
13.4 Final Decision 10
(ii)
TABLE OF CONTENTS
PAGE
ARTICLE XIV - MISCELLANEOUS 10
14.1 Liability for Benefits 10
14.2 Allocation of Asset 10
14.3 Protective Provisions 10
14.4 Transfer of Participant's Interest in the Policy 11
14.5 Terms 11
14.6 Governing Law 11
14.7 Validity 11
14.8 Notice 11
14.9 Successors 11
14.10 Not a Contract of Service 11
SCHEDULE I
Death Benefits Payable Under Portland General Corporation
Outside Directors' Life Insurance Benefit Plan
EXHIBIT A
Collateral Assignment
(iii)
INDEX OF TERMS
TERM AND PROVISION NUMBER PAGE
B
Board: 2.1 1
C
Cash Value: 2.2 1
Cause: 2.3 1
Change in Control: 2.4 1
Committee: 2.5 2
Company: 2.6 2
D
Date of Participation: 2.7 2
Direct Subsidiary: 2.8 3
E
Exchange Act: 2.4(a) 1
I
Indirect Subsidiary: 2.9 3
Insurer: 2.10 3
N
Named Fiduciary: 12.1 8
Net Single Premium: 2.11 3
O
Outside Director: 2.12 3
P
Participant: 2.13 3
Participant's Share: 2.14 3
Participating Company: 2.15 3
Participating Company's Share of Premium: 2.16 4
PGC: 2.4(a) 1
PGE: 2.4(a) 1
Plan: 2.17 4
Policy: 2.18 4
(iv)
INDEX OF TERMS
TERM AND PROVISION NUMBER PAGE
R
Retirement: 2.19 4
S
Senior Administrative Officer: 2.20 4
(v)
PORTLAND GENERAL CORPORATION
OUTSIDE DIRECTORS' LIFE INSURANCE BENEFIT PLAN
1996 RESTATEMENT
ARTICLE I - PURPOSE
1.1 Purpose
This Plan has been established to provide Outside Directors of Portland
General Corporation and Participating Companies with supplemental life
insurance protection for their families in the event of death under a split
dollar life insurance arrangement. This Plan became effective on January 1,
1987 and was restated effective December 1, 1988.
1.2 Effective Date
This 1996 Restatement is adopted to make amendments to the Plan effective
January 1, 1996.
ARTICLE II - DEFINITIONS
Whenever used in this document, the following terms shall have the
meanings set forth in this Article unless a contrary or different meaning is
expressly provided:
2.1 Board
"Board" shall mean the Board of Directors of Portland General Corporation.
2.2 Cash Value
"Cash Value" shall mean the Policy's cash value as that term is defined in
the Policy.
2.3 Cause
"Cause" shall mean a breach of fiduciary duty while a member of the Board.
2.4 Change in Control
A "Change in Control" shall mean:
(a) 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 Portland General Corporation ("PGC") or Portland General
Electric ("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
PAGE 1 - OUTSIDE DIRECTORS' LIFE INSURANCE BENEFIT PLAN
percent (30%) or
more of the combined voting power of PGC's or PGE's then outstanding
voting securities;
(b) During any period of two (2) consecutive years (not including any
period prior to the execution of this Agreement), individuals who at the
beginning of such period constitute the 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 Board 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 of whose election or nomination for election was
previously so approved, cease for any reason to constitute at least a
majority thereof;
(c) The stockholders of PGC or PGE approve a merger or consolidation
of PGC or PGE with any other corporation, other than:
(i) 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
eighty percent (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
(ii) 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
(d) 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 percent (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 nonoperational projects. Projects
in economy shutdown shall be considered long-term assets.
2.5 Committee
"Committee" shall mean the Human Resources Committee of the Board.
2.6 Company
"Company" shall mean Portland General Corporation, an Oregon corporation.
2.7 Date of Participation
"Date of Participation" shall mean the earlier of the date on which the
Policy is issued or the date on which the Insurer agrees to bind coverage.
PAGE 2 - OUTSIDE DIRECTORS' LIFE INSURANCE BENEFIT PLAN
2.8 Direct Subsidiary
"Direct Subsidiary" means any corporation of which a Participating Company
owns at least eighty percent (80%) of the total combined voting power of all
classes of its stock entitled to vote.
2.9 Indirect Subsidiary
"Indirect Subsidiary" means any corporation of which a Participating
Company directly and constructively owns at least eighty percent (80%) of the
total combined voting power of all classes of its stock entitled to vote. In
determining the amount of stock of a corporation that is constructively owned
by a Participating Company, stock owned, directly or constructively, by a
corporation shall be considered as being owned proportionately by its
shareholders according to such shareholders' share of voting power of all
classes of its stock entitled to vote.
2.10 Insurer
"Insurer" shall mean any insurance company issuing a Policy under this
Plan.
2.11 Net Single Premium
"Net Single Premium" shall mean the amount calculated by an enrolled
actuary selected by the Senior Administrative Officer, required to obtain the
level death benefit promised in Table I, calculated using the 1983 Group
Annuity Table male rates and employing continuous functions.
2.12 Outside Director
"Outside Director" shall mean a member of the Board who is not an employee
of Portland General Corporation or any Direct Subsidiary or an Indirect
Subsidiary of Portland General Corporation.
2.13 Participant
"Participant" shall mean an Outside Director who has elected to
participate in the Plan and was an Outside Director on or before January 1,
1996.
2.14 Participant's Share
"Participant's Share" shall mean the aggregate portion of premiums
contributed by the Participant.
2.15 Participating Company
"Participating Company" shall mean the Company or any affiliated or
subsidiary company designated by the Board as a Participating Company under
the Plan, as long as such designation has become effective and continues to be
in effect. The designation as a Participating Company shall become effective
only upon the acceptance of such designation and the formal adoption of the
Plan by a Participating Company. A Participating Company may revoke its
acceptance of designation as a Participating Company at any time, but until it
makes such revocation, all of the provisions of this Plan and any amendments
thereto shall apply to the Participants and their beneficiaries of the
Participating Company.
PAGE 3 - OUTSIDE DIRECTORS' LIFE INSURANCE BENEFIT PLAN
2.16 Participating Company's Share of Premium
"Participating Company's Share of Premium" shall mean the aggregate amount
of insurance premium paid by the Participating Company less the Participant's
Share.
2.17 Plan
"Plan" shall mean the Portland General Corporation Outside Directors' Life
Insurance Benefit Plan, as may be amended from time to time.
2.18 Policy
"Policy" shall mean each life insurance policy which is issued by an
insurer on the life of the Participant.
2.19 Retirement
"Retirement" shall mean separation from service on the Board as an Outside
Director, at the earlier of age seventy (70) or ten (10) years of Benefit
Service, as defined in the Company's Retirement Plan for Outside Directors.
2.20 Senior Administrative Officer
"Senior Administrative Officer" shall mean the employee in the management
position designated by the Committee to administer the Plan.
ARTICLE III - PARTICIPATION
3.1 Eligibility
Eligibility shall be limited to Outside Directors who served on the Board
on or before January 1, 1996.
3.2 Election to Participate
An Outside Director may elect to participate in the Plan by completing
such documents as may be prescribed by the Senior Administrative Officer.
ARTICLE IV - POLICY TITLE AND OWNERSHIP
4.1 Policy Title
The Participant, or his transferee, shall be the owner of the Policy and
may exercise all ownership rights granted to the owner by the terms of the
Policy, except as herein provided. These shall include, but are not limited
to, the right to assign his interest in the Policy, the right to change the
beneficiary of that portion of the proceeds to which he is entitled under
Article VII, and the right to exercise settlement options.
PAGE 4 - OUTSIDE DIRECTORS' LIFE INSURANCE BENEFIT PLAN
4.2 Participating Company's Security Interest
The only rights in and to the Policy granted to a Participating Company
shall be limited to its security interest in the cash value of the Policy, as
defined in the collateral assignment attached as Exhibit A, and a portion of
the death benefit, as hereinafter provided under Article VI.
ARTICLE V - PREMIUM PAYMENT
5.1 Participating Company's Premium Payment
Each premium on the Policy shall be paid by the Participating Company as
it becomes due.
5.2 Payment of the Participant's Share
At the time of each premium payment by the Participating Company, the
Participant shall pay to the Participating Company an amount equal to the
economic benefit of said Policy enjoyed by the Participant. The economic
benefit shall be equal to the lesser of the Insurer's one-year term cost or
the PS-58 rate.
ARTICLE VI - PARTICIPATING COMPANY'S INTEREST IN THE POLICY
6.1 Collateral Assignment
Each Participant shall assign the Policy to the Participating Company as
collateral, under the form of collateral assignment attached as Exhibit A. The
assignment gives the Participating Company the limited power to enforce its
right to recover the Participating Company's Share of Premium on the Policy
and/or a portion of the death benefit thereof.
6.2 Limitations
The interest of the Participating Company in and to the Policy shall be
specifically limited to the following rights in and to the Cash Value and a
portion of the death benefit:
(a) the right to recover the Participating Company's Share of
Premium, in the event the Policy is surrendered or canceled by the
Participant, as provided in Paragraph 7.1;
(b) the right to recover, upon the death of the Participant, all of
the Policy proceeds, in excess of that portion of the Policy proceeds
payable to the Participant's beneficiary or beneficiaries as provided in
Paragraph 7.2;
(c) the right to recover the Participating Company's Share of
Premium, or to receive ownership of the Policy, in the event of
termination by the Participant in the Plan, or in the event of termination
of service on the Board of a Participating Company as provided in
Paragraphs 8.1 and 8.2.
PAGE 5 - OUTSIDE DIRECTORS' LIFE INSURANCE BENEFIT PLAN
ARTICLE VII - PARTICIPANT'S INTEREST IN THE POLICY
7.1 Upon Surrender or Cancellation
Upon surrender or cancellation of the Policy, the Participating Company
shall be entitled to receive a portion of the cash surrender value equal to
the Participating Company's Share of Premium. The balance of the cash
surrender value, if any, shall belong to the Participant.
7.2 Upon Death
Upon the death of the Participant, the beneficiary or beneficiaries
designated by the Participant shall be entitled to receive that portion of the
Policy proceeds equal to the amount set forth in Schedule I of this Plan.
7.3 Ownership of Cash Surrender Value
Notwithstanding any other provision in the Plan to the contrary, the
Participant shall at all times own a portion of the cash surrender value of
the Policy equal to the Participant's Share to the extent said cash surrender
value exceeds the Participating Company's Share of Premium.
ARTICLE VIII - PLAN BENEFITS
8.1 Upon Termination of Participation in the Plan
In the event the Participant terminates participation in the Plan prior to
leaving service on the Board of any Participating Company, the Participant
shall execute any and all instruments that may be required to vest ownership
of said Policy in the Participating Company. Participating Employer shall
purchase from the Participant the Participant's interest in the cash surrender
value set forth in paragraph 7.3 above for an amount equal to the
Participant's Share. Thereafter, the Participant shall have no further
interest in the Policy or this Plan.
8.2 Upon Termination of Service
(a) In the event of termination of service on the Board of any
Participating Company for Cause (as determined by the Committee) before
Retirement, the Participant shall execute any and all instruments that may
be required to vest ownership of said Policy in the Participating Company.
The Participating Employer shall purchase from the Participant the
Participant's interest in the cash surrender value set forth in paragraph
7.3 above for an amount equal to the Participant's Share. Thereafter, the
Participant shall have no further interest in the Policy or this Plan.
(b) In the event of termination of service on the Board of any
Participating Company because of accepting a position of public service,
or other reason not considered for Cause before Retirement, the
Participant may elect either to:
(i) reimburse the Participating Company an amount equal to the
Participating Company's Share of Premium, whereupon receipt of payment
from the Participant, the Company shall release the collateral
assignment and thereafter shall have no further interest in the
Policy, or
PAGE 6 - OUTSIDE DIRECTORS' LIFE INSURANCE BENEFIT PLAN
(ii) execute any and all instruments that may be required to vest
ownership of said Policy in the Participating Company. The
Participating Company shall purchase from the Participant the
Participant's interest in the cash surrender value set forth in
paragraph 7.3 above for an amount equal to the Participant's Share.
Thereafter, the Participant shall have no further interest in the
Policy or this Plan.
8.3 Upon Change in Control
In the event of a Change in Control, within sixty (60) days of such Change
in Control, the Participating Company shall:
(a) determine to what extent the cash value exceeds the Net Single
Premium and recover the excess, if any; and
(b) upon recovery of the excess, release the collateral assignment
and thereafter have no further interest in the Policy; and
(c) pay to each Participant an amount equal to the excess, if any, of
the Net Single Premium over the cash value released to the Participant in
(b) above.
8.4 Upon Retirement
In the event of termination from service on the Board of a Participating
Company at or after Retirement, the Participant may elect either to:
(a) reimburse the Participating Company an amount equal to the
Participating Company's Share of Premium, whereupon receipt of payment
from the Participant, the Company shall release the collateral assignment
and thereafter shall have no further interest in the Policy, or
(b) continue participation in the Plan with the Company continuing to
pay premiums, and the Participant continuing to pay the Participant's
Share pursuant to Article V.
8.5 Timely Transfer of Ownership
When, under the terms of Article VIII, ownership of the Policy transfers
from the Participant to the Participating Employer, the Participant shall
execute any and all instruments that may be required to vest such ownership of
said Policy in the Participating Employer within ninety (90) days following
receipt of notice from the Participating Company.
ARTICLE IX - DURATION OF THE PLAN
9.1 Plan Continuation
Subject to the provisions of Article VIII, this Plan shall continue with
respect to each Participant until such time as the Cash Value of the Policy on
a Participant is sufficient to permit:
(a) the Participating Company to recover the Participating Company's
Share of Premium; and
PAGE 7 - OUTSIDE DIRECTORS' LIFE INSURANCE BENEFIT PLAN
(b) the Participant to recover an amount equal to the federal and
state income tax he will incur as a result of termination of the split
dollar arrangement; and
(c) the death benefit to continue to the Participant's age ninety-
five (95) with no further premium outlay based upon then current interest
assumptions.
9.2 Termination of Arrangement
When the standard required by Paragraph 9.1 is achieved and upon the
Participating Company's receiving the Participating Company's Share of
Premium, the split dollar arrangement with that Participant shall terminate.
The Participating Company shall release the collateral assignment and
thereafter, shall have no further interest in the Policy.
ARTICLE X - AMENDMENT AND TERMINATION OF PLAN
10.1 Amendment
The Senior Administrative Officer may amend the Plan from time to time as
may be necessary for administrative purposes and legal compliance, provided,
however, that no such amendment shall affect the benefit rights of
Participants or Beneficiaries in the Plan. Prior to achieving the standard
required by Paragraph 9.1, the Committee may not amend, modify or revoke this
Plan in a manner that reduces the rights of the Participant under this Plan.
10.2 Termination
The Board of each Participating Company may at any time, in its sole
discretion, terminate the Plan in whole or in part for that Participating
Company, such that no future Participants will be allowed into the Plan.
However, no such termination shall adversely affect the benefits of
Participants which have accrued prior to such action, the benefits of any
Participant who has previously retired, the benefits of any beneficiary of a
Participant who has previously died, or already accrued Plan liabilities
between Participating Companies.
ARTICLE XI - INSURER NOT A PARTY TO PLAN
An Insurer shall be bound only by the provisions of and endorsements on
the Policy, and any payments made or action taken by an Insurer in accordance
therewith shall fully discharge it from all claims, suits and demands of all
persons whatsoever. Except as specifically provided by endorsement on the
Policy, it shall in no way be bound by the provisions of this Plan.
ARTICLE XII - NAMED FIDUCIARY
12.1 Senior Administrative Officer; Committee
The Senior Administrative Officer is hereby designated the "Named
Fiduciary" until removal by the Committee. As Named Fiduciary, the Senior
Administrative Officer shall be responsible for the management, control and
administration of the Plan established herein. The Senior Administrative
Officer may allocate to others certain aspects of the management and operation
responsibilities of the
PAGE 8 - OUTSIDE DIRECTORS' LIFE INSURANCE BENEFIT PLAN
Plan, including the employment of advisors and the
delegation of any ministerial duties to qualified individuals.
12.2 Indemnity of Senior Administrative Officer; Committee
Each Participating Company shall indemnify and hold harmless the Senior
Administrative Officer and the Committee and its individual members against
any and all claims, loss, damage, expense or liability arising from any action
or failure to act with respect to this Plan, except in the case of gross
negligence or willful misconduct.
12.3 Availability of Plan Documents
Each Participant shall receive a copy of this Plan, and the Senior
Administrative Officer shall make available for inspection by any Participant
a copy of the rules and regulations used in administering the Plan.
12.4 Cost of Plan Administration
The Company shall bear all expenses of administration. However, a ratable
portion of the expense shall be charged back to each Participating Company.
ARTICLE XIII - CLAIMS PROCEDURE
13.1 Claim
Claims for any benefits due under the Plan or upon surrender of the Policy
shall be made in writing by the Participating Company, and the Participant or
his designated beneficiary or beneficiaries, as the case may be, to the Named
Fiduciary or his delegatee who shall respond in writing as soon as
practicable.
13.2 Denial of Claim
In the event a claim is denied or disputed, the Named Fiduciary shall,
within a reasonable period of time after receipt of the claim, notify the
Participating Company, and the Participant or his designated beneficiary or
beneficiaries, as the case may be, of such denial or dispute listing:
(a) the reasons for the denial or dispute; with specific reference to
the Plan provisions upon which the denial or dispute is based;
(b) a description of any additional material or information necessary
and an explanation of why it is necessary; and
(c) an explanation of the Plan's claim review procedure.
13.3 Review of Claim
Within sixty (60) days of denial or notice of claim under the Plan, a
claimant may request that the claim be reviewed by the Named Fiduciary. The
claim or request shall be reviewed by the
PAGE 9 - OUTSIDE DIRECTORS' LIFE INSURANCE BENEFIT PLAN
Named Fiduciary, who may, but shall
not be required to, grant the claimant a hearing. On review, the claimant may
have representation, examine pertinent documents and submit issues and
comments in writing.
13.4 Final Decision
The decision of the Senior Administrative Officer on review shall normally
be made within sixty (60) days. If an extension of time is required for a
hearing or other special circumstances, the claimant shall be notified and the
time limit shall be one hundred twenty (120) days. The decision shall be in
writing and shall state the reasons and the relevant Plan provisions. All
decisions on review shall be final and bind all parties concerned.
ARTICLE XIV - MISCELLANEOUS
14.1 Liability for Benefits
Except as otherwise provided in this paragraph, liability for the payment
of a Participant's benefit pursuant to this Plan shall be borne solely by the
Participating Company for which the Participant serves during the accrual or
increase of the Plan benefit, and no liability for the payment of any Plan
benefit shall be incurred by reason of Plan sponsorship or participation
except for the Plan benefits of a Participating Company's own Board members.
Provided, however, that each Participating Company, by accepting the Board's
designation as a Participating Company under the Plan and formally adopting
the Plan, agrees to assume secondary liability for the payment of any benefit
accrued or increased while a Participant serves on the Board of a
Participating Company that is a Direct Subsidiary or Indirect Subsidiary of
the Participating Company at the time such benefit is accrued or increased.
Such liability shall survive any revocation of designation as a Participating
Employer with respect to any liabilities accrued at the time of such
revocation. Nothing in this paragraph shall be interpreted as prohibiting any
Participating Company or any other person from expressly agreeing to
assumption of liability for a Plan Participant's payment of any benefits under
the Plan.
14.2 Allocation of Asset
The interests of each Participating Company in and to the Policy as
described in paragraph 6.2 shall be allocated, if applicable, pro rata among
those Participating Companies who employed the Participant and reported the
Participant as being on their payroll during the accrual or increase of the
Plan benefit. Such allocation of asset shall survive any revocation of
designation as a Participating Company or termination of the Plan with respect
to any asset accrued at the time of such revocation or termination.
14.3 Protective Provisions
A Participant will cooperate with the Participating Company by furnishing
any and all information requested by the Participating Company, in order to
facilitate the payment of benefits hereunder, and by taking such physical
examination as the Participating Company may deem necessary and taking such
other action as may be requested by the Participating Company.
PAGE 10 - OUTSIDE DIRECTORS' LIFE INSURANCE BENEFIT PLAN
14.4 Transfer of Participant's Interest in the Policy
In the event a Participant shall transfer all of his interest in the
Policy, then all of a Participant's interest in the Policy shall be vested in
his transferee, who shall be substituted as a party hereunder, and a
Participant shall have no further interest in the Policy.
14.5 Terms
In this Plan document, unless the context clearly indicates the contrary,
the masculine gender will be deemed to include the feminine gender, and the
singular shall include the plural.
14.6 Governing Law
The provisions of this Plan shall be construed and interpreted according
to the laws of the State of Oregon, except as preempted by federal law.
14.7 Validity
In case any provision of this Plan shall be held illegal or invalid for
any reason, such illegality or invalidity shall not affect the remaining parts
hereof, but this Plan shall be construed and enforced as if such illegal and
invalid provision had never been inserted herein.
14.8 Notice
Any notice or filing required or permitted to be given to the Senior
Administrative Officer under the Plan shall be sufficient if in writing and
hand delivered, or sent by registered or certified mail to the Senior
Administrative Officer or to Secretary of Company. Notice to the Senior
Administrative Officer, if mailed, shall be addressed to the principal
executive offices of the Participating Company. Notice mailed to the
Participant shall be at such address as is given in the records of the
Participating Company. Notices shall be deemed given as of the date of
delivery or, if delivery is made by mail, as of the date shown on the postmark
on the receipt for registration or certification.
14.9 Successors
The provisions of this Plan shall bind and inure to the benefit of each
Participating Company and its successors and assigns. The term successors as
used herein shall include any corporate or other business entity which shall,
whether by merger, consolidation, purchase or otherwise, acquire all or
substantially all of the business and assets of the Participating Company, and
successors of any such corporation or other business entity.
14.10 Not a Contract of Service
The terms and conditions of this Plan shall not be deemed to constitute a
contract of service between a Participating Company and a Participant, and
neither a Participant nor a Participant's Spouse or Dependent shall have any
rights against a Participating Company except as may otherwise be specifically
provided herein. Moreover, nothing in this Plan shall be deemed to give a
Participant the right to be retained on the Board of a Participating Company
nor shall it interfere with the Participant's right to terminate his
directorship at any time.
PAGE 11 - OUTSIDE DIRECTORS' LIFE INSURANCE BENEFIT PLAN
IN WITNESS WHEREOF, the Company has caused this instrument to be executed
by its officers thereunto duly authorized, as of the ___ day of May, 1996.
PORTLAND GENERAL CORPORATION
By: /s/ Don F. Kielblock
Its: Senior Administrative Office
PAGE 12 - OUTSIDE DIRECTORS' LIFE INSURANCE BENEFIT PLAN
SCHEDULE I
Death Benefits Payable Under
Portland General Corporation
Outside Directors' Life Insurance Benefit Plan
1996 Restatement
Effective January 1, 1996
Outside Directors $200,000
EXHIBIT A
Collateral Assignment
THIS ASSIGNMENT, made and entered into and effective this ______ day of
_____________, 19___, by the undersigned as owner (the "Owner") of that
certain Life Insurance Policy No. ___________ issued by
________________________ ("Insurer") and any supplementary contracts issued
in connection therewith (said policy and contracts being herein called the
"Policy"), upon the life of ________________ ("Insured"), to Portland
General Corporation, an Oregon corporation (the "Assignee").
WITNESSETH:
WHEREAS, the Insured is a Director of the Assignee; and
WHEREAS, said Assignee desires to provide the Insured with supplemental
life insurance protection by contributing a portion of the annual premium
due on the Policy, as more specifically provided for in the split dollar
arrangement set forth in the Outside Directors' Life Insurance Benefit Plan
(the "Plan"); and adopted as restated by the Assignee on December 1, 1988,
a copy of which is attached hereto, incorporated by reference and made a
part hereof; and
WHEREAS, in consideration of the Assignee agreeing to pay a portion of
the premiums, the Owner agrees to grant the Assignee an interest in the
policy as security for the recovery of the Assignee's premium outlay.
NOW THEREFORE, for value received, the undersigned hereby assigns,
transfers and sets over to the Assignee, its successors and assigns, the
following specific rights in the Policy, subject to the following terms and
conditions:
1. This Assignment is made, and the Policy is to be held, as
collateral security for the premium payments made by Assignee, pursuant to
the terms of the Plan.
2. The Assignee's interest in the Policy shall further be limited to:
(a) The right to recover the aggregate amount of insurance premium
paid by the Assignee less the aggregate portion contributed by the
Participant (the "Assignee's Share of Premium") in the event the Policy
is surrendered or canceled by the Owner as provided in Section 7.1 of
the Plan,
(b) The right to recover, upon the death of the Participant, all
proceeds in excess of the death benefit promised in Schedule I of the
Outside Directors' Life Insurance Benefit Plan,
(c) The right to recover the Assignee's Share of Premium, the
right to recover the excess of cash value over the Net Single Premium,
or the right to receive ownership of the Policy in the event of
termination of the split dollar arrangement as provided in Article VIII
of the Plan.
EXHIBIT A
Collateral Assignment
(Continued)
3. Except as specifically herein granted to the Assignee, the Owner
shall retain all incidents of ownership in the Policy, including, but not
limited to, the right to assign his interest in the Policy, the right to
change the beneficiary of that portion of the proceeds to which he is
entitled under Article VI of the Plan, and the right to exercise all
settlement options permitted by the terms of the Policy. Provided, however,
that all rights retained by the Owner shall be subject to the terms and
conditions of the Plan.
4. The Assignee shall, upon request, forward the Policy to the
Insurer, without unreasonable delay, for endorsement of any designation of
change of beneficiary, any election of optional mode of settlement, or the
exercise of any other right reserved by the Owner hereunder.
5. The Insurer is hereby authorized to recognize the Assignee's claims
to rights hereunder without investigating the reason for any action taken
by the Assignee, the amount of its Share of Premium, the existence of any
default therein, the giving of any notice required herein, or the
application to be made by the Assignee of any amounts to be paid to the
Assignee.
The signature of the Assignee shall be sufficient for the exercise
of any rights under the Policy assigned hereby to the Assignee, and the
receipt of the Assignee for any sums received by it shall be a full
discharge and release therefore to the Insurer.
6. The Insurer shall be fully protected in recognizing the requests
made by the Owner for surrender of the Policy with or without the consent
of the Assignee, and, upon such surrender, the Policy shall be terminated
and shall be of no further force or effect.
7. Upon the full payment to the Assignee of its Share of Premium, or
in the event of a Change in Control upon recovery of the excess of cash
value over the Net Single Premium the Assignee shall release the Collateral
Assignment and reassign to the Owner all specific rights included in this
Collateral Assignment.
IN WITNESS WHEREOF, the undersigned Owner has executed this Assignment
the date and year first above written.
Witness Owner