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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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FORM 10-K
(MARK ONE)
/X/ ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(D)
OF THE SECURITIES EXCHANGE ACT OF 1934
FOR THE FISCAL YEAR ENDED DECEMBER 31, 1993
OR
/ / TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE
SECURITIES EXCHANGE ACT OF 1934
FOR THE TRANSITION PERIOD FROM _____________ TO _____________
COMMISSION FILE NUMBER 1-5152
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PACIFICORP
(Exact name of registrant as specified in its charter)
STATE OF OREGON 93-0246090
(State or other jurisdiction (I.R.S. Employer Identification
of incorporation or No.)
organization)
700 N.E. MULTNOMAH, 97232-4116
PORTLAND, OREGON (Zip Code)
(Address of principal
executive offices)
Registrant's telephone number, including area code: (503) 731-2000
SECURITIES REGISTERED PURSUANT TO SECTION 12(B) OF THE ACT:
NAME OF EACH EXCHANGE
TITLE OF EACH CLASS ON WHICH REGISTERED
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Common Stock New York Stock Exchange
Pacific Stock Exchange
$1.98 No Par Serial Preferred Stock, ($25 New York Stock Exchange
Stated Value), Series 1992
SECURITIES REGISTERED PURSUANT TO SECTION 12(G) OF THE ACT:
TITLE OF EACH CLASS
5% PREFERRED STOCK (CUMULATIVE; $100 STATED VALUE)
SERIAL PREFERRED STOCK (CUMULATIVE; $100 STATED VALUE)
NO PAR SERIAL PREFERRED STOCK (CUMULATIVE; VARIOUS STATED VALUES)
Indicate by check mark whether the Registrant (1) has 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
Registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days. YES /X/ NO / /
Indicate by check mark if disclosure of delinquent filers pursuant to Item
405 of Regulation S-K is not contained herein, and will not be contained, to the
best of Registrant's knowledge, in definitive proxy or information statements
incorporated by reference in Part III of this Form 10-K or any amendment to this
Form 10-K. [ ]
On March 1, 1994, the aggregate market value of the shares of voting stock
of the Registrant held by nonaffiliates was approximately $5.5 billion.
As of March 1, 1994, there were 281,786,301 shares of the Registrant's
common stock outstanding.
DOCUMENTS INCORPORATED BY REFERENCE
Portions of the Annual Report to Shareholders of the Registrant for the year
ended December 31, 1993 are incorporated by reference in Parts I and II and
appended hereto.
Portions of the Annual Reports on Form 10-K of Pacific Telecom, Inc. and
PacifiCorp Financial Services, Inc. for the year ended December 31, 1993 are
incorporated by reference in Part I.
Portions of the proxy statement of the Registrant for the 1994 Annual
Meeting of Shareholders are incorporated by reference in Part III.
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TABLE OF CONTENTS
PAGE
NO.
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Definitions .............................................................................................. ii
Part I
Item 1. Business............................................................................... 1
The Organization..................................................................... 1
Electric Utility Operations.......................................................... 1
Pacific Telecom...................................................................... 10
Other................................................................................ 10
Discontinued Operations.............................................................. 10
Employees............................................................................ 10
Item 2. Properties............................................................................. 10
Item 3. Legal Proceedings...................................................................... 13
Item 4. Submission of Matters to a Vote of Security Holders.................................... 14
Item 4A. Executive Officers of the Registrant................................................... 14
Part II
Item 5. Market for Registrant's Common Equity and Related Stockholder Matters.................. 16
Item 6. Selected Financial Data................................................................ 16
Item 7. Management's Discussion and Analysis of Financial Condition and Results of
Operations............................................................................ 16
Item 8. Financial Statements and Supplementary Data............................................ 17
Item 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure... 17
Part III
Item 10. Directors and Executive Officers of the Registrant..................................... 17
Item 11. Executive Compensation................................................................. 17
Item 12. Security Ownership of Certain Beneficial Owners and Management......................... 17
Item 13. Certain Relationships and Related Transactions......................................... 17
Part IV
Item 14. Exhibits, Financial Statement Schedules and Reports on Form 8-K........................ 17
Signatures ............................................................................................... 21
Appendices
Financial Statements and Supplementary Data
Statements of Computation of Ratio of Earnings to Fixed Charges
List of Subsidiaries
i
DEFINITIONS
When the following terms are used in the text they will have the meanings
indicated:
TERM MEANING
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BPA.................................... Bonneville Power Administration
Company................................ PacifiCorp, an Oregon corporation
FERC................................... Federal Energy Regulatory Commission
Merger................................. The January 9, 1989 merger of PacifiCorp, a Maine corporation, and Utah
Power & Light Company, a Utah corporation, into the Company
NERCO.................................. NERCO, Inc., formerly an approximately 82% owned subsidiary of
PacifiCorp Holdings
PFS.................................... PacifiCorp Financial Services, Inc., a wholly-owned subsidiary of
PacifiCorp Holdings, and its subsidiaries
PacifiCorp Holdings.................... PacifiCorp Holdings, Inc., a wholly-owned subsidiary of the Company
Pacific Power.......................... Pacific Power & Light Company, the assumed business name of the Company
under which it conducts a portion of its retail electric operations
Pacific Telecom........................ Pacific Telecom, Inc., an approximately 87% owned subsidiary of
PacifiCorp Holdings, and its subsidiaries
Utah Power............................. Utah Power & Light Company, the assumed business name of the Company
under which it conducts a portion of its retail electric operations
ii
PART I
ITEM 1. BUSINESS
THE ORGANIZATION
The Company is an electric utility that conducts a retail electric utility
business through two divisions, Pacific Power and Utah Power, and engages in
power production and sales on a wholesale basis under the name PacifiCorp. The
Company formed PacifiCorp Holdings in 1984 to hold the stock of the Company's
principal subsidiaries and to facilitate the conduct of businesses not regulated
as electric utilities. The Company's strategic business plan is to strengthen
the scope and competitive position of its electric utility and
telecommunications operations, and to reduce the size and narrow the scope of
its other diversified activities.
Through PacifiCorp Holdings, the Company indirectly owns approximately 87%
of Pacific Telecom, a telecommunications company that provides local telephone
service and access to the long distance network in Alaska, seven other western
states and three midwestern states, intrastate and interstate long distance
communication services in Alaska, and cellular mobile telephone services.
Pacific Telecom is also engaged in the sale of capacity in and the operation of
a submarine fiber optic cable between the United States and Japan.
PacifiCorp Holdings also holds PFS (100%). Consistent with PacifiCorp's
strategic plan, PFS plans to continue to sell substantial portions of its loan,
leasing and real estate investments over the next several years. PFS presently
expects to retain only its tax advantaged investments in leveraged lease assets
(primarily aircraft and project finance) and low-income housing projects. In
addition, PacifiCorp Holdings owns Pacific Generation Company, which is engaged
in the independent power production and cogeneration business. The Company sold
NERCO through a merger transaction with a subsidiary of RTZ America, Inc. in
June 1993. See "Discontinued Operations."
Note 14 to the Consolidated Financial Statements appended hereto contains
information with respect to the revenue and income from operations contributed
by each of the Company's industry segments for the past three years and the
identifiable assets attributable to each segment at the end of each of those
years; this information is incorporated herein by this reference. For the year
ended December 31, 1993, 73% of PacifiCorp's revenues from operations were
derived from Electric Operations, while Pacific Telecom contributed 21%.
The Company's common stock (symbol PPW) is traded on the New York Stock
Exchange and the common stock of Pacific Telecom, Inc. (symbol PTCM) is traded
on the national over-the-counter market. The Company's $1.98 No Par Serial
Preferred Stock, Series 1992, is traded on the New York Stock Exchange.
ELECTRIC UTILITY OPERATIONS
PacifiCorp conducts its retail electric utility operations as Pacific Power
and as Utah Power, and engages in wholesale electric transactions under the name
PacifiCorp. Pacific Power and Utah Power are operated as separate divisions
providing electric service within their respective service territories. Power
production, wholesale sales, fuel supply and administrative functions are
managed on a coordinated basis.
SERVICE AREA
Pacific Power serves approximately 736,000 retail customers in service areas
aggregating about 71,000 square miles in portions of six western states: Oregon,
Wyoming, Washington, Idaho, California and Montana. Its electric service
territory is generally rural and suburban and principally agricultural. The
existing industrial base is diversified. Pacific Power also provides service to
several subregional business centers.
1
Utah Power provides electric service to about 572,000 retail customers in a
service area of approximately 82,000 square miles in portions of Utah and Idaho.
The area served has a widely diversified industrial and agricultural economy and
an abundance of natural resources.
The geographical distribution of retail electric operating revenues for the
year ended December 31, 1993 was Utah, 35.0%; Oregon, 31.8%; Wyoming, 15.4%;
Washington, 8.5%; Idaho, 4.8%; California, 2.7%; and Montana, 1.8%.
CUSTOMERS
Electric utility revenues and energy sales, by class of customer, for the
three years ended December 31, 1993 were as follows:
1992 1991
1993 ---------------- ----------------
----------------
Operating Revenues (Dollars in
millions):
Residential................. $ 698.9 29% $ 649.8 28% $ 663.8 30%
Commercial.................. 543.9 22 526.9 23 517.4 23
Industrial.................. 696.2 28 695.6 30 674.9 31
Government, Municipal and
Other...................... 29.8 1 29.9 1 34.2 1
---------- ---- ---------- ---- ---------- ----
Total Retail Sales........ 1,968.8 80 1,902.2 82 1,890.3 85
Wholesale Sales-Firm........ 422.5 17 356.5 15 264.7 12
Wholesale Sales-Nonfirm..... 77.3 3 71.3 3 59.9 3
---------- ---- ---------- ---- ---------- ----
Total Energy Sales........ 2468.6 100% 2,330.0 100% 2,214.9 100%
---- ---- ----
---- ---- ----
Other Revenues(1)........... 38.3 32.4 36.9
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Total Operating
Revenues................. $ 2,506.9 $ 2,362.4 $ 2,251.8
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Kilowatt-hours Sold (kwh in
millions):
Residential................. 12,055 21% 11,230 21% 11,354 22%
Commercial.................. 10,085 18 9,733 18 9,416 19
Industrial.................. 19,671 34 19,942 36 19,322 38
Government, Municipal and
Other...................... 602 1 606 1 692 1
---------- ---- ---------- ---- ---------- ----
Total Retail Sales........ 42,413 74 41,511 76 40,784 80
Wholesale Sales-Firm........ 11,919 21 10,455 19 7,349 14
Wholesale Sales-Nonfirm..... 3,030 5 2,965 5 2,946 6
---------- ---- ---------- ---- ---------- ----
Total kwh Sold............ 57,362 100% 54,931 100% 51,079 100%
---------- ---- ---------- ---- ---------- ----
---------- ---- ---------- ---- ---------- ----
<FN>
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(1) Includes miscellaneous and steam heating revenues.
Both Pacific Power's and Utah Power's sales are seasonal. Pacific Power's
customer demand peaks in the winter months due to space heating requirements.
Utah Power's customer demand peaks in the summer when irrigation and cooling
systems are heavily used. Many factors affect per customer consumption of
electricity. For residential customers, within a given year, weather conditions
are the dominant cause of usage variations from normal seasonal patterns.
However, the price of electricity is also considered a significant factor.
During 1993, no single retail customer accounted for more than 1.6% of the
Company's retail utility revenues and the 20 largest retail customers accounted
for 12.6% of total retail electric revenues.
COMPETITION
Although Pacific Power and Utah Power operate as regulated monopolies within
their respective service areas, the Company encounters significant competition
from both traditional and nontraditional energy suppliers. Competition varies in
form and intensity and includes competition from both
2
utility and nonutility energy suppliers for industrial customers, as well as for
wholesale power sales to other utilities; self generation and cogeneration by
industrial customers; and substitute energy forms for residential and commercial
space heating, cooling and water heating.
In response to this competition, the Company is seeking to remain cost
competitive through utilization of its diverse electrical system to increase
operating efficiencies in power plant operations and transmission. The Company's
combined production and transmission cost in 1991 was one-third lower than the
average for investor owned utilities in the western United States according to a
study released by a major independent rating agency in July 1993. The Company
also seeks to acquire additional low cost resources, minimize price increases
and assist its customers in acquiring and implementing energy efficiency
measures. Through these efforts, the Company has been able to maintain customer
prices that are below the average for the western United States as reported by
Edison Electric Institute in 1993. See "Regulation."
The Energy Policy Act of 1992 ("Energy Act") became effective in October
1992. The Energy Act grants the FERC authority to require utilities that own
transmission facilities to provide transmission access to other entities. This
requirement has not had, nor is expected to have, a material adverse effect on
the Company because, as a condition of the FERC's approval of the Merger, the
Company is already subject to transmission access requirements similar to those
provided for in the Energy Act. The Energy Act also exempts certain independent
power producers from the Public Utility Holding Company Act. Over the long term,
this provision is expected to increase competition in the industry.
CURRENT POWER AND FUEL SUPPLY
The Company's generating facilities are interconnected through its own
transmission lines or by contract through the lines of others. Substantially all
generating facilities and reservoirs located within the Pacific Northwest are
managed on a coordinated basis to obtain maximum load carrying capability and
efficiency.
The Company's transmission system connects with other utilities in the
Northwest having low-cost hydroelectric generation and with utilities in
California and the Southwest having higher-cost, fossil-fuel generation. In
periods of favorable hydro conditions, the Company utilizes lower-cost
hydroelectric power to supply a greater portion of its load and attempts to sell
its displaced higher-cost thermal generation to other utilities. In periods of
less favorable hydro conditions, the Company seeks to sell excess thermal
generation to utilities which are more dependent on hydroelectric generation
than the Company. During the winter, the Company is able to purchase power from
Southwest utilities, either for its own peak requirements or for resale to other
Northwest utilities. During the summer, the Company is able to sell excess power
to Southwest utilities to assist them in meeting their peak requirements. See
"Wholesale Sales and Purchased Power."
The Company owns or has interests in generating plants with an aggregate
nameplate rating of 8,348.8 megawatts ("MW") and plant capability of 7,884.5 MW.
See "Item 2. Properties." With its present generating facilities, under average
water conditions, the Company expects that approximately 7% of its energy
requirements for 1994 will be supplied by its hydroelectric plants and 80% by
its thermal plants. The balance of 13% will be obtained under long-term purchase
contracts, interchange and other purchase arrangements. Note 8 to the
Consolidated Financial Statements appended hereto contains additional details
relating to the Company's purchase of power under long-term arrangements.
The Company is purchasing 1,100 MW of capacity from BPA pursuant to a
short-term agreement that extends through July 31, 1995. The Company's current
annual payment for purchases under the short-term agreement is $77.2 million,
which will increase at the rate of increase of BPA's average system cost. See
"Regulation" for information concerning an increase in BPA's rates. BPA is
undertaking an environmental review of a proposal to extend the capacity sale
through August 31, 2011. The Company has agreed to enter into a long-term
agreement if offered by BPA at the conclusion of
3
this process. If BPA is unable to offer any long-term or short-term contract
after completion of the environmental review, the Company would be required to
obtain other sources of capacity, which it believes are available.
In January 1993, the Operating Committee for the Trojan Plant formally
approved the permanent cessation of nuclear operations at the plant, which had
been shut down since November 9, 1992 when a leak was detected in a steam
generator tube. Portland General Electric Company is the operator of the Trojan
Plant and owns a 67.5% share. The Eugene Water and Electric Board has assigned
its 30% interest in the plant to BPA, and the Company owns a 2.5% interest.
Recovery of the Company's remaining investment in the Trojan Plant ($14.4
million at December 31, 1993) and estimated plant closure and decommissioning
costs ($14.7 million at December 31, 1993) are subject to regulatory approval.
Under the requirements of the Public Utility Regulatory Policies Act of 1978
("PURPA"), the Company purchases the output of qualifying facilities constructed
and operated by entities that are not public utilities. During 1993, the Company
purchased an average of 94 MW from qualifying facilities, compared to an average
of 63 MW in 1992. The increase was attributable to a new 53 MW qualifying
facility that began deliveries in 1993. See "Wholesale Sales and Purchased
Power."
In 1993, the Company entered into a 20-year transmission agreement with
Southern California Edison Company, which initially provides the Company with 78
MW of off peak transfer capability and up to 165 MW of additional transfer
capability, if available, from Arizona through southern California and to the
Company's system at the Oregon border. Under the agreement, the off peak
transfer capability will increase to 260 MW and the additional transfer
capability, if available, to 347 MW in 1994. This arrangement is expected to
improve the Company's ability to utilize its resources in a more cost effective
manner, as well as provide access to surplus resources in the desert Southwest.
The Company plans and manages its capacity and energy resources based on
critical water conditions. Under critical or better water conditions in the
Northwest, the Company believes that it has adequate reserve generation capacity
for its requirements. The Company's historical total firm peak load (including
both retail and firm wholesale sales) of 8,838 MW occurred on November 24, 1993,
and historical on-system firm peak load of 7,623 MW occurred on December 21,
1990.
WHOLESALE SALES AND PURCHASED POWER
Wholesale sales continue to contribute significantly to total revenues. The
Company's wholesale sales complement its retail business and enhance the
efficient use of its generating capacity. In 1993, wholesale sales accounted for
26% of total energy sales and 20% of total energy revenues.
In addition to its base of thermal and hydroelectric resources, the Company
utilizes a mix of long-term and short-term firm power purchases and nonfirm
purchases to meet its load obligations and to make sales to other utilities when
prices are favorable. Firm power purchases supplied 10% of the Company's total
energy requirements in 1993. Nonfirm purchases were 6% of total energy
requirements in 1993 and slightly in excess of the total amount of energy sold
by the Company on the nonfirm wholesale market during the year.
During 1993, the Company commenced purchases under several new firm power
arrangements, including a 5-year agreement for the purchase of 100 MW of annual
capacity and energy, a 30-year agreement with respect to a 53 MW qualifying
facility and a short-term agreement covering 90 average MW of energy for the
period May 1 through September 15, 1993. The Company also purchased 222 MW under
a new 10-year winter capacity agreement in 1993, and has the right to receive
322 MW in 1994 and 422 MW in 1995 and each year thereafter through the term of
this agreement, which the Company may extend to 2008.
4
PROPOSED ASSET ADDITIONS
In accordance with the Company's long range integrated resource planning
process, also referred to as "least-cost planning," the Company considers
various future demand and supply options for providing customers with reliable,
low-cost energy services. See "Projected Demand." In this connection, the
Company also seeks opportunities to acquire existing assets from other
utilities.
The Company has signed a contract to acquire electricity from a 474 MW
natural gas cogeneration plant in Hermiston, Oregon. Affiliates of U.S.
Generating Company will finance, build and operate the plant. The Company will
have an option to own up to 50% of the plant once it begins operation. U.S.
Generating Company must arrange for long-term gas supplies by mid-1994, and
construction is scheduled to begin in 1994, with commercial operation expected
by mid-1996. The project, which is located in the western part of the Company's
system, will provide power at a cost expected to be less expensive than other
supply side options available to the Company and to be competitive with coal
fired generation.
The Company has signed a contract to build a 50 MW cogeneration project at
the James River paper mill in Camas, Washington. The steam purchase agreement
extends for 20 years. The facility will use steam produced for the paper making
process to drive an electric turbine-generator. It should begin operating in
late 1995. The project provides the Company with an efficient source of
generation near the Portland metropolitan area.
The Company has signed contracts to build two wind generation projects, a 70
MW project in Wyoming and a 50 MW project in Washington, both of which are to be
built by Kenetech Windpower and scheduled to begin producing power in 1996. The
Company is to own 53.2, or about 37 MW, of the Wyoming project and 37.5%, or
about 19 MW, of the Washington project.
The terms of the Company's 1991 transaction with Arizona Public Service
Company ("APS") call for the construction by APS of 150 MW of combustion
turbines to be owned by the Company. The Company will pay APS a $20 million fee
upon commercial operation of the turbines for rights and services provided by
APS. Commercial operation of the turbines is expected by early 1997.
PROJECTED DEMAND
Annual increases in retail kilowatt-hour sales for the Company have averaged
2.2% since 1988. The Company has benefited from improved economic conditions in
portions of its service territory and the Company's commitment to price
stability. Substantial price reductions in many of the Company's service
territories have helped sustain sales volume growth. See "Regulation."
In connection with its long-range integrated resource planning process,
which includes load growth projections for its service areas, the Company
analyzed a range of average annual growth in energy requirements from 0.3% to
3.8% over a 20-year horizon. For the period 1994 to 1998, the average annual
growth is expected to be 2.1%, excluding the effect of the Company's demand-side
efficiency programs. Actual growth in the future will be determined by economic
and demographic growth, competition and the effectiveness of energy efficiency
programs.
The Company's base of existing resources, in combination with actions
outlined in its integrated resource plan, are expected to be sufficient to meet
the above range of possible load growth conditions throughout the 1990s. Actions
outlined in the integrated resource plan include energy efficiency by customers
(demand-side management), efficiency improvements to existing generation,
transmission and distribution systems, and investments in cogeneration, single
cycle and combined cycle combustion turbines and in renewable resources. See
"Proposed Asset Additions." The Company will use the results of its integrated
resource planning process as a framework to evaluate opportunities to acquire
surplus generating facilities from other utilities.
Demand-side management is an element of the Company's diversified portfolio
of resources identified in its integrated plan. The use of an energy service
charge concept in the Company's demand-side resource programs is intended to
allow these resources to be acquired at competitive
5
costs. Under the energy service charge program, the customers receiving the
benefits of energy efficiency measures are expected to pay most of the related
costs. The Company expended an aggregate of $41.1 million for demand-side
resources in 1993, while acquiring 19.6 average MW of energy efficiency.
ENVIRONMENT
In addition to land use restrictions and other controls by local
governments, the Company is subject to regulation by federal, state and local
authorities pursuant to legislation designed to protect and enhance the quality
of the environment, including air and water quality, remediation of
contamination, waste disposal and protection of endangered species.
Environmental regulation has not only increased the cost of providing electric
service, it has adversely affected various industrial groups, thereby negatively
impacting kwh sales by the Company. However, the Company has been able to manage
these additional costs to date without having to pass the costs directly to its
customers in the form of higher rates. The Company's ability to avoid such price
increases in the future is uncertain.
AIR QUALITY. The Company's operations are subject to regulation under the
Federal Clean Air Act, as enforced by the Environmental Protection Agency
("EPA") and various state agencies. The Company believes that all of the
coal-fired generating plants operated by it comply in all material respects with
current emission standards. Some of the plants have recently modified their fuel
supply systems or processes in order to meet those standards. The Company
believes that it can continue to operate its plants at or below mandated
emission rates without incurring costs that would have a material adverse effect
on its consolidated results of operations.
In August 1993, the Sierra Club filed an action against the owners of the
Hayden Generating Station alleging violations of state and federal air quality
regulations at the station since 1988. In April 1992, the Company acquired
interests in two units of the station, which is operated by Public Service
Company of Colorado. Among other things, the complaint seeks civil monetary
penalties and an injunction requiring the defendants to operate the station in
compliance with applicable statutes and regulations. The Sierra Club has also
indicated that it may pursue similar claims with respect to the Craig Generating
Station, in which the Company also has ownership interests.
Various federal and state agencies have raised concerns with respect to
perceived visibility degradation in areas where the Company owns coal-fired
generating plants. Two visibility studies have been completed within the
Company's service territory, one in Washington and the other in the Canyonlands
area of Utah. To date, no additional emission control requirements have resulted
from these studies. The Company is participating in additional visibility
studies in western Wyoming, Colorado and the Grand Canyon area. The findings of
these studies may have a significant impact on operations at a number of
generating plants owned by the Company or in which the Company has an ownership
interest.
The 1990 Clean Air Act Amendments require an overall reduction in the
emission of sulfur dioxide (SO2) and nitrogen oxides (NOx) from utility
generating plants, and establish a system of marketable SO2 emission allowances.
The Company's generating plants burn low, sulfur coal and the majority of the
Company's plants representing a majority of its installed capacity have been
equipped with SO2 emission controls. However, the new law will result in
additional operating costs because the Company will be required to maintain and
manage SO2 emission levels, install approximately $10 million of emission
monitoring equipment, and reduce NOx emissions at some of its generating plants.
The SO2 emission allowances to be awarded to the Company are sufficient to
enable the Company to meet its current needs and expansion plans and may enable
the Company to take advantage of opportunities to sell surplus allowances to
other utilities. In 1993, the Company negotiated a sale of surplus allowances to
Illinois Power Company, which is still pending.
6
Emissions from coal-fired generating plants include carbon dioxide. Carbon
dioxide emissions are not currently subject to regulation, but have been the
subject of increasing public concern. The Company is testing various techniques
of offsetting carbon dioxide emissions to determine their feasibility and cost
effectiveness.
ENDANGERED SPECIES. Enforcement of the Endangered Species Act ("ESA") and
other laws by the National Marine Fisheries Service ("NMFS") and the U.S. Fish
and Wildlife Service ("FWS") is affecting the Company's operations in a number
of areas.
Environmental regulation under the ESA has resulted in reduced availability
of timber for use by the Company's customers in the wood products industry, and
long range timber management plans for timberlands managed by federal and state
agencies are expected to further reduce the volume of timber available for
processing. In addition, the listing of the Northern Spotted Owl under the ESA
is expected to result in further restrictions on timber harvesting from both
public and private timber lands. These actions have adversely affected kwh sales
to the Company's customers in the wood products industry.
Protection of habitat of endangered and threatened species will make it more
difficult to site and construct new transmission and distribution facilities and
generating plants, and may be a consideration in connection with the relicensing
of existing hydroelectric generating projects.
NMFS is responsible for ESA actions regarding marine fish and certain marine
mammals. As a result of recent decisions with respect to the listing of species
of Columbia River salmon as endangered or threatened, NMFS is involved in
recovery measure planning that could result in changes in federal hydrosystem
operations and flows. These changes could affect the availability and cost of
power from BPA. Pending and threatened lawsuits under the ESA and the Northwest
Power Act could result in further restrictions on the federal hydropower system
and affect regional power supplies and costs.
The FWS has identified the Lost River sucker, the shortnose sucker, and the
bald eagle as species listed under the ESA that may be affected by operations of
the Klamath Project, a hydroelectric project in southern Oregon and Northern
California. Waterflows through the Klamath Project are largely subject to the
discretion of the U.S. Bureau of Reclamation, which owns the Link River Dam.
Because of recent drought conditions, flows past the Link River Dam have been
substantially reduced, which has contributed to a reduction in hydroelectric
generation at certain of the Company's downstream hydroelectric plants. In
addition, pending litigation with respect to diversions from Upper Klamath Lake
could result in further restrictions on hydroelectric generation at the Klamath
Project.
The Company anticipates that other fish species will be nominated for ESA
listings, and such actions could further impact the Company's hydroelectric
resources. The Company is continuing to monitor and participate in regional ESA
activities to minimize the generation and economic impacts resulting from such
actions. It is unknown at this time what impact, if any, these actions will have
on the Company's operations.
ELECTROMAGNETIC FIELDS. A number of studies have examined the possibility
of adverse health effects from electromagnetic fields ("EMF"), without
conclusive results. Certain states have enacted regulations to limit the
strength of magnetic fields at the edge of transmission line rights-of-way;
however, other than California, none of the jurisdictions in which the Company
operates has adopted formal rules or programs with respect to EMF or EMF
considerations in the siting of electric facilities. In California, the
Commission has issued an interim order requiring utilities to implement no cost
or low cost mitigation measures in the certification process for their
facilities. The Company expects that public concerns about EMF will make it more
difficult to site and construct new power lines and substations in the future.
It is uncertain whether the Company's operations may be adversely affected in
other ways as a result of EMF concerns.
ENVIRONMENTAL CLEANUPS. Under the Comprehensive Environmental Response,
Compensation and Liability Act and comparable state statutes, entities that
disposed of or arranged for the disposal of hazardous substances, and the owners
and operators of the related property, may be liable for the
7
remediation of contaminated sites. The Company has been identified as a
potentially responsible party in connection with a number of cleanup sites to
which it may have sent transformers containing polychlorinated biphenyls
("PCBs"), used oil and other hazardous wastes. In addition, certain of the
Company's own properties have been identified as requiring remediation. The
Company is conducting or participating in investigations and remedial actions
with respect to those sites; however, the costs associated with those actions
are not expected to be material to the Company's consolidated results of
operations.
WATER QUALITY. The Clean Water Act requires permits for the discharge of
certain pollutants into the waters of the United States, including storm water
runoff. Under this Act, EPA has issued effluent limitation guidelines,
pretreatment standards and new source performance standards for the control of
certain pollutants; and individual states may impose still more stringent
limitations. The Company presently has the required discharge permits for its
facilities. Additional regulations may be promulgated in the future, but the
Company is unable to predict the extent to which such additional regulations
will affect its operations and capital expenditure requirements.
HAZARDOUS WASTES. The federal Resource Conservation and Recovery Act
("RCRA") has established a national program for the handling, treatment,
recycling, storage and disposal of hazardous wastes. To date, RCRA has not had a
material impact on the Company's operations or expenditures; however, EPA and
the Congress are studying the impacts of high volume, low toxicity utility
wastes, such as fly ash, which are now exempt from RCRA regulations. If this
exception were to be withdrawn, the Company would be faced with considerable
expense to change its disposal practices and modify its existing disposal
facilities.
MISCELLANEOUS. High sodium levels in the flue gas desulphurization waste
ponds at the Jim Bridger and Naughton coal-fired generating plants may have
caused mortalities of waterfowl protected under the Migratory Bird Treaty Act.
In cooperation with Bureau of Land Management ("BLM") and the FWS, the Company
has installed a pilot system at the Naughton Plant pond and is studying possible
methods of reducing or eliminating bird mortalities.
REGULATION
The Company is subject to the jurisdiction of public utility regulatory
authorities of each of the states in which Pacific Power and Utah Power conduct
retail electric operations as to prices, services, accounting, issuance of
securities and other matters. The Company is a "licensee" and a "public utility"
as those terms are used in the Federal Power Act and is, therefore, subject to
regulation by the FERC as to accounting policies and practices, certain prices
and other matters. Most of the Company's hydroelectric plants are licensed as
major projects under the Federal Power Act and certain of these projects are
licensed under the Oregon Hydroelectric Act.
The Company is currently in the process of relicensing certain of its
hydroelectric projects under the Federal Power Act and will be seeking licenses
for other projects in the future. As a condition to the relicensing, the FERC is
expected to impose conditions designed to address the impact of the projects on
fish and other environmental concerns. See "Environment; Endangered Species."
The Company is unable to predict the impact of imposition of such conditions,
but capital expenditures and operating costs could increase in future periods.
In addition, the Company may refuse relicenses for certain projects if the terms
of renewal make the projects uneconomical to operate.
Prices charged to retail customers are subject to regulation in each of the
states Pacific Power or Utah Power serves. Interstate sales of electricity at
wholesale prices and interstate wheeling rates are regulated by the FERC. Except
in Montana, where the commission is elected, commissioners are appointed by the
individual state's governor for varying terms. While regulation varies from
state to state, industry analysts consider the overall quality of the regulatory
commissions having jurisdiction over Pacific Power and Utah Power to be about
average in their treatment of the rate applications of utilities.
8
The Company seeks to minimize retail price increases. From January 1, 1988
through December 31, 1993, the Company reduced prices paid by retail customers
by $178 million, or 10% on an annualized basis. Effective October 1, 1993, BPA
increased its wholesale power and transmission rates, increasing the price of
the Company's capacity purchases by 16% and wheeling services by 37%. In
addition, this rate increase reduced the Company's residential exchange benefits
under the Pacific Northwest Electric Power Planning and Conservation Act; such
benefits are passed on directly to the Company's residential and small farm
customers in Washington, Oregon, Montana and Idaho. Price increases in the 6% to
8% range were approved in all four states, reflecting the loss of residential
exchange benefits.
BPA also has the option of an additional interim rate increase (maximum of
10%) October 1, 1994, if operating conditions warrant. The additional interim
rate increase would be applicable only to the residential exchange benefits.
In December 1993, the California Public Utilities Commission ("CPUC")
adopted, at the Company's request, an alternate incentive form of regulation
which will be used for the next three to six years. In adopting the mechanism,
the CPUC approved a 2% average rate increase for the Company in 1994. Price
increases in the future will be based on a formula consisting of an inflation
index, less a productivity factor, with prices capped at 105% of the national
average.
A committee including representatives of the Company, FERC and each state
public service commission regulating Pacific Power and Utah Power has met to
discuss allocation of investment, costs and revenues, including the effect of
Merger benefits, among jurisdictions in order to satisfy post-Merger pricing
methodologies and reporting requirements. In January 1993, the state
representatives reached an agreement in principle on the allocation method to be
used beginning in 1993. The methodology is expected to be supported by the
commission staffs in the various jurisdictions, but adoption of the methodology
will be dependent upon commission action in specific rate proceedings.
CONSTRUCTION PROGRAM
The following table shows actual construction costs for 1993 and the
Company's estimated construction costs for 1994 through 1996, including costs of
acquiring demand-side resources. The estimates of construction costs for 1994
through 1996 are subject to continuing review and reductions are currently
anticipated. These estimates do not include expected expenditures for purchases
of generating assets. See "Proposed Asset Additions" for information concerning
recent and proposed additions to the Company's generating assets.
Estimated
-------------------------------
Type of Facility Actual 1993 1994 1995 1996
- --------------------------------------------------- ----------- --------- --------- ---------
(Dollars in millions)
Production......................................... $ 165 $ 163 $ 185 $ 246
Transmission....................................... 117 103 105 138
Distribution....................................... 237 249 154 144
Mining............................................. 39 48 47 49
Other.............................................. 78 173 119 108
----- --------- --------- ---------
Total(1)....................................... $ 636 $ 736 $ 610 $ 685
----- --------- --------- ---------
----- --------- --------- ---------
<FN>
- ------------------------
(1) Excludes interest capitalized, or estimated to be capitalized, on equity
funds used during construction as follows: $4 million, $5 million, $6
million and $8 million for 1993, 1994, 1995 and 1996, respectively.
9
PACIFIC TELECOM
Pacific Telecom provides local telephone service and access to the long
distance network in Alaska, seven other western states and three midwestern
states. Alascom, Inc., Pacific Telecom's long distance telephone subsidiary,
provides Alaska with both intrastate and interstate long distance communication
services. In addition, Pacific Telecom has acquired and is developing, operating
and managing cellular mobile telephone services in seven states. Pacific Telecom
is also involved in the sale of capacity in and the operation of a submarine
fiber optic cable between the United States and Japan, a system that became
operational in May 1991. See "Telecommunications" appended hereto. For further
information with respect to the business of Pacific Telecom, see "Item 1.
Business" of the Annual Report on Form 10-K of Pacific Telecom, Inc. for the
year ended December 31, 1993; such information is incorporated herein by this
reference.
See "Item 3. Legal Proceedings" for a discussion of certain litigation
affecting Pacific Telecom.
OTHER
The other operations of the Company include PFS. Consistent with
PacifiCorp's strategic plan, PFS plans to continue to sell substantial portions
of its loan, leasing and real estate investments over the next several years.
PFS presently expects to retain only its tax advantaged investments in leveraged
lease assets (primarily aircraft and project finance) and low-income housing
projects. For further information with respect to the business of PFS, see "Item
1. Business" of the Annual Report on Form 10-K of PacifiCorp Financial Services,
Inc. for the year ended December 31, 1993; such information is incorporated
herein by this reference.
DISCONTINUED OPERATIONS
The Company's natural resource subsidiary, NERCO, was shown as a
discontinued operation in 1992. In June 1993, the Company completed the sale of
its ownership interest in NERCO through a merger transaction with a subsidiary
of RTZ America, Inc. PacifiCorp Holdings received cash consideration of
approximately $384 million for its shares of NERCO common stock. In connection
with the merger, a subsidiary of the Company loaned $225 million to a subsidiary
of RTZ America, Inc. that is to be repaid as, and only to the extent that,
certain future contract revenues are received.
A subsidiary of Pacific Telecom, International Communications Holdings, Inc.
("ICH"), was shown in 1992 as a discontinued operation pending completion of an
agreement to sell its wholly-owned subsidiary, TRT Communications, Inc. ("TRT"),
to IDB Communications Group, Inc. ("IDB"). Under the agreement, which closed in
the third quarter of 1993, the stock of TRT and the stock of another smaller
subsidiary were exchanged for 4.5 million shares of IDB's common stock, and $1
million in cash.
EMPLOYEES
PacifiCorp and its subsidiaries had 13,635 employees on December 31, 1993.
Of these employees, 9,475 were employed by PacifiCorp and its mining affiliates,
2,834 were employed by Pacific Telecom and 1,326 were employed by PFS and other
subsidiaries.
Approximately 65% of the employees of PacifiCorp and its mining affiliates
are covered by union contracts, principally with the International Brotherhood
of Electrical Workers, the Utility Workers Union of America and the United Mine
Workers of America.
For information with respect to the employees of Pacific Telecom and PFS,
see "Item 1. Business" of the Annual Reports on Form 10-K of Pacific Telecom,
Inc. and PacifiCorp Financial Services, Inc., for the year ended December 31,
1993; such information is incorporated herein by this reference.
In the Company's judgment, employee relations are satisfactory.
10
ITEM 2. PROPERTIES
The Company owns 52 hydroelectric generating plants and has an interest in
one additional plant, with an aggregate nameplate rating of 1,014.5 MW and plant
capability of 1,110.8 MW. It also owns or has interests in 15 thermal-electric
generating plants with an aggregate nameplate rating of 7,334.3 MW and plant
capability of 6,773.7 MW. In January 1993, a decision was made to cease nuclear
operations at the Trojan Plant, in which the Company has a 2.5% interest (30.4
MW). See "Item 1. Business. Electric Utility Operations -- Current Power and
Fuel Supply." The following table summarizes the Company's existing generating
facilities:
INSTALLATION NAMEPLATE PLANT
LOCATION ENERGY SOURCE DATES RATING(MW) CAPABILITY(MW)
--------------------- ---------------- ------------ ---------- --------------
HYDROELECTRIC PLANTS
Swift..................... Cougar, Washington Lewis River 1958 204.0 267.9
Merwin.................... Ariel, Washington Lewis River 1931-1958 136.0 144.0
Five North Umpqua Plants.. Toketee Falls, Oregon N. Umpqua River 1950-1956 133.5 135.5
Yale...................... Amboy, Washington Lewis River 1953 108.0 132.0
John C. Boyle............. Keno, Oregon Klamath River 1958 80.0 82.0
Copco Nos. 1 and 2
Plants................... Hornbrook, California Klamath River 1918-1925 47.0 54.5
Clearwater Nos. 1 and 2
Plants................... Toketee Falls, Oregon Clearwater River 1953 41.0 41.0
Grace..................... Grace, Idaho Bear River 1914-1923 33.0 33.0
Prospect No. 2............ Prospect, Oregon Rogue River 1928 32.0 36.0
Cutler.................... Collinston, Utah Bear River 1927 30.0 29.1
Oneida.................... Preston, Idaho Bear River 1915-1920 30.0 28.0
Iron Gate................. Hornbrook, California Klamath River 1962 18.0 20.0
Soda...................... Soda Springs, Idaho Bear River 1924 14.0 7.0
Fish Creek................ Toketee Falls, Oregon Fish Creek 1952 11.0 12.0
33 Minor Hydroelectric
Plants................... Various Various 1896-1990 97.0* 88.8*
---------- -------
Subtotal
(53 Hydroelectric
Plants)................ 1,014.5 1,110.8
THERMAL ELECTRIC PLANTS
Jim Bridger............... Rock Springs, Wyoming Coal-Fired 1974-1979 1,495.0* 1,386.7*
Huntington................ Huntington, Utah Coal-Fired 1974-1977 892.8 805.0
Dave Johnston............. Glenrock, Wyoming Coal-Fired 1959-1972 816.7 772.0
Naughton.................. Kemmerer, Wyoming Coal-Fired 1963-1971 707.2 700.0
Centralia................. Centralia, Washington Coal-Fired 1972 693.5* 636.5*
Hunter 1 and 2............ Castle Dale, Utah Coal-Fired 1978-1980 687.7* 608.5*
Hunter 3.................. Castle Dale, Utah Coal-Fired 1983 446.4 395.0
Cholla Unit 4............. Joseph City, Arizona Coal-Fired 1981 414.0 380.0
Wyodak.................... Gillette, Wyoming Coal-Fired 1978 289.7* 256.0*
Gadsby.................... Salt Lake City, Utah Gas-Fired 1951-1955 251.6 235.0
Carbon.................... Castle Gate, Utah Coal-Fired 1954-1957 188.6 175.0
Craig 1 and 2............. Craig, Colorado Coal-Fired 1979-1980 172.1* 165.0*
Colstrip 3 and 4.......... Colstrip, Montana Coal-Fired 1984-1986 155.6* 144.0*
Hayden 1 and 2............ Hayden, Colorado Coal-Fired 1965-1976 81.3* 78.0*
Blundell.................. Milford, Utah Geothermal 1984 26.1 23.0
Little Mountain........... Ogden, Utah Gas Turbine 1971 16.0 14.0
---------- -------
Subtotal (15 Thermal
Electric Plants)......... 7,334.3 6,773.7
---------- -------
Total Hydro and Thermal
Generating Facilities
(68)..................... 8,348.8 7,884.5
---------- -------
---------- -------
<FN>
- ------------------------------
* Jointly owned plants; amount shown represents the Company's share only.
NOTE: Hydroelectric project locations are stated by locality and river
watershed.
11
The Company's generating facilities are interconnected through its own
transmission lines or by contract through the lines of others. Substantially all
generating facilities and reservoirs located within the Pacific Northwest region
are managed on a coordinated basis to obtain maximum load carrying capability
and efficiency. Portions of the Company's transmission and distribution systems
are located, by franchise or permit, upon public lands, roads and streets and,
by easement or license, upon the lands of others.
Substantially all of the Company's electric utility plants are subject to
the liens of the Company's Mortgages and Deeds of Trust.
The following table describes the Company's recoverable coal reserves as of
December 31, 1993. All coal reserves are dedicated to nearby generating plants.
Recoverability by surface mining methods typically ranges between 90% and 95%.
Recoverability by underground mining techniques ranges from 50% to 70%. The
Company considers that the respective reserves assigned to the Centralia, Craig,
Dave Johnston, Huntington, Hunter and Jim Bridger plants, together with coal
available under both long-term and short-term contracts with external suppliers,
will be sufficient to provide these plants with fuel that meets the Clean Air
Act standards effective in 1995, for their current economically useful lives.
The sulfur content of the reserves ranges from 0.43% to 0.84% and the BTU value
per pound of the reserves ranges from 7,600 to 11,400. Reserve estimates are
subject to adjustment as a result of the development of additional data, new
mining technology and changes in regulation and economic factors affecting the
utilization of such reserves.
RECOVERABLE TONS
LOCATION PLANT SERVED (IN MILLIONS)
- -------------------------------------------------- ---------------------- ----------------
Centralia, Washington............................. Centralia 49 (1)
Craig, Colorado................................... Craig 73 (2)
Glenrock, Wyoming................................. Dave Johnston 69 (1)
Emery County, Utah................................ Huntington and Hunter 163 (1)(3)
Rock Springs, Wyoming............................. Jim Bridger 160 (4)
<FN>
- ------------------------
(1) These reserves are mined by subsidiaries of the Company.
(2) These reserves are leased and mined by Trapper Mining Company, a wholly
owned subsidiary of Williams Fork Company, in which the Company owns
approximately 20% of the outstanding stock.
(3) These reserves are in underground mines.
(4) These reserves are leased and mined by Bridger Coal Company, a joint
venture between Pacific Minerals, Inc., a subsidiary of the Company, and a
subsidiary of Idaho Power Company. Pacific Minerals, Inc. has a two-thirds
interest in the joint venture.
Most of the Company's coal reserves are held pursuant to leases from the
federal government through the BLM and from certain states and private parties.
The leases generally have multi-year terms that may be renewed or extended and
require payment of rentals and royalties. In addition, federal and state
regulations require that comprehensive environmental protection and reclamation
standards be met during the course of mining operations and upon completion of
mining activities. In 1993, the Company expended $3.2 million of reclamation
costs and accrued $5.4 million of estimated final mining reclamation costs.
Final mine reclamation funds have been established with respect to certain of
the Company's mining properties. At December 31, 1993, the Company's pro rata
portion of these reclamation funds totalled $20 million and the Company had an
accrued reclamation liability of $96 million at December 31, 1993.
For a description of the properties of Pacific Telecom and PFS, see "Item 1.
Business" and "Item 2. Properties" of the Annual Reports on Form 10-K of Pacific
Telecom, Inc. and PacifiCorp Financial Services, Inc. for the year ended
December 31, 1993; such information is incorporated herein by this reference.
12
ITEM 3. LEGAL PROCEEDINGS
The Company and its subsidiaries are parties to various legal claims,
actions and complaints, certain of which are described below. Although it is
impossible to predict with certainty whether or not the Company and its
subsidiaries will ultimately be successful in its legal proceedings or, if not,
what the impact might be, management believes that disposition of these matters
will not have a material adverse effect on the Company's consolidated results of
operations.
The Company is a defendant in BONNEVILLE POWER ADMINISTRATION V. WASHINGTON
PUBLIC POWER SUPPLY SYSTEM, ET AL. (formerly styled WASHINGTON PUBLIC POWER
SUPPLY SYSTEM V. ALDER MUTUAL LIGHT COMPANY, ET AL.) (United States District
Court, Western District of Washington, filed October 26, 1982), a case initially
filed by the Washington Public Power Supply System, a joint operating agency of
public utility district organizations and other public bodies ("Supply System"),
to obtain a judgment declaring the proper formula to allocate common costs of
Supply System Units 1, 3, 4 and 5. The Company, a 10% owner of Unit 3,
subsequently asserted in this proceeding that the Unit 3 Ownership Agreement had
been breached or that its purpose had been frustrated, and that the Company was
excused from further obligation under the Ownership Agreement and was entitled
to recover its investment. On September 17, 1985, the Company and the other
private utility owners of Unit 3 executed agreements with BPA and the Supply
System to settle the Unit 3 dispute and requested that the court dismiss the
claims relating to that dispute. A number of public utilities in Washington
opposed the settlement and filed claims alleging that the settlement was
illegal. In May 1989, most of the parties entered into an agreement under which
the challenges to the settlement agreements were dismissed. A trustee for
certain Supply System bondholders is continuing to pursue the cost sharing
claims. On October 5, 1990, the court issued an order ruling that costs appeared
to have been misallocated and granting the trustee's request for an accounting.
In February 1992, the Ninth Circuit Court of Appeals reversed the trial court's
order and remanded the case for further proceedings.
In November 1991, former shareholders of American Network, Inc. ("AmNet")
filed a third amended complaint against Pacific Telecom and others, suing
individually and also derivatively on behalf of AmNet for damages allegedly
arising out of the acquisition of AmNet by United States Transamerica Systems,
Inc. ("USTS"), a subsidiary of ITT Corporation, in 1988 and various alleged
actions in connection with certain transactions that occurred in 1984 and 1986
between AmNet or its subsidiaries and Pacific Telecom or between AmNet and other
parties. (LOEWEN, ET AL. V. GALLIGAN, ET AL., Circuit Court for the State of
Oregon, County of Multnomah; United States District Court, District of Oregon.)
At the time of the acquisition by USTS, Pacific Telecom owned 36.4% of the
common shares of AmNet. The third amended complaint revised the plaintiffs' 1984
and 1986 fraud claims and changed the plaintiffs under all claims. As a result,
differing plaintiff groups are now suing Pacific Telecom and other defendants
for state securities and common law fraud allegedly committed in 1984, 1986 and
1988, and four plaintiffs are suing Pacific Telecom alone for breach of an
alleged promise to provide financial support to AmNet in 1984. Plaintiffs seek
to recover damages from Pacific Telecom in the amount of plaintiffs' lost
investments, plaintiffs' costs, disbursements and reasonable attorney fees, and
punitive damages of $100,000,000. On August 19, 1992, the court granted
defendants' motions for summary judgment against all claims in the third amended
complaint. Judgment in favor of defendants was entered on November 23, 1992 and
plaintiffs' appeal to the Oregon Court of Appeals is pending.
A class action complaint was filed against Equitec Financial Group, Inc.
("Equitec"), certain of its subsidiaries and former directors and officers, as
well as the Company, PacifiCorp Holdings and PacifiCorp Financial Services.
(DUVAL, ET AL. V. GLEASON, ET AL., Alameda County Superior Court, filed August
16, 1989). PacifiCorp Holdings acquired an interest in Equitec in December 1987
and owns approximately 49% of Equitec's stock. The complaint, as amended, was
filed on behalf of the limited partners in twelve real estate limited
partnerships sponsored by Equitec during the 1980-1988 period, and alleges fraud
and breach of fiduciary duty by the defendants in connection with the public
offering
13
and management of the real estate partnerships. Plaintiffs seek an unspecified
amount of compensatory and punitive damages, an accounting of transactions
entered into by the partnerships and rescission of the purchase of their
partnership interests. The PacifiCorp defendants filed a demurrer to the amended
complaint, which was allowed with prejudice and without further leave to amend.
The plaintiffs in the DUVAL case have also filed two actions in the federal
district court for the Northern District of California alleging fraud under the
federal securities laws in connection with the sale of interests in the same
partnerships. (SPENCER, ET AL. V. GLEASON, ET AL. and DUVAL, ET AL. V. GLEASON,
ET AL., United States District Court for the Northern District of California.)
The PacifiCorp defendants filed answers in the federal proceedings denying any
liability. The PacifiCorp defendants also filed a motion to dismiss all of
plaintiffs' remaining claims. This motion was heard by the court on November 12,
1993 and is pending.
The Company, PacifiCorp Holdings and PacifiCorp Financial Services are also
among the defendants in a consolidated class action filed by certain limited
partners in Equitec partnerships alleging violations of the securities laws in
connection with the roll-up of the partnerships into a master limited
partnership. (IN RE EQUITEC ROLL-UP LITIGATION, United States District Court for
the Northern District of California.) The case was consolidated for trial with a
similar suit brought by individuals who opted out of the class certified in the
class action. (AABERG, ET AL. V. EQUITEC FINANCIAL GROUP, INC. ET AL., United
States District Court for the Northern District of California.) The court
granted the PacifiCorp defendants' motion for judgment as a matter of law on
February 8, 1994.
In August 1992, Equitec and certain of its subsidiaries filed a complaint
against the Company, PacifiCorp Holdings, PacifiCorp Financial Services, certain
other subsidiaries of the Company, and certain current and former directors and
officers of the Company or its subsidiaries. (EQUITEC, ET AL. V. PACIFICORP, ET
AL., Superior Court of California for Alameda County.) The complaint asserted
claims arising out of PacifiCorp Holding's acquisition of an interest in Equitec
in December 1987, and its continued ownership of approximately 49% of Equitec's
stock. The parties negotiated a settlement agreement, and the court dismissed
this action with prejudice on November 29, 1993.
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
No information is required to be reported pursuant to this item.
ITEM 4A. EXECUTIVE OFFICERS OF THE REGISTRANT
The following is a list of all executive officers of the Company. There are
no family relationships among the executive officers. Officers are normally
elected annually.
MEMBERS OF CORPORATE POLICY GROUP
Frederick W. Buckman, born March 9, 1946, President and Chief Executive
Officer of the Company
Mr. Buckman was elected President and Chief Executive Officer of the Company
effective February 1, 1994 and became a director of the Company and PacifiCorp
Holdings, Inc. in February 1994. He formerly served as President and Chief
Executive Officer of Consumers Power Company, Jackson, Michigan, from 1992 to
1994 and as President and Chief Operating Officer of Consumers Power Company
from 1988 to 1991.
William J. Glasgow, born September 29, 1946, Senior Vice President and Chief
Financial Officer of the Company, President, Chief Executive Officer and
Director of PacifiCorp Holdings, Inc., Chairman and Chief Executive Officer of
PacifiCorp Financial Services, Inc.
Mr. Glasgow was elected Senior Vice President of the Company in February
1992 and became Chief Financial Officer in June 1993. He served as Chairman,
President and Chief Executive Officer of PacifiCorp Financial Services, Inc.
from July 1989 to April 1993 and continues as Chairman and Chief Executive
Officer. He became President and Chief Executive Officer of PacifiCorp Holdings,
Inc. in June 1993. He was President and General Manager of that company since
February 1992.
14
Paul G. Lorenzini, born April 16, 1942, President of Pacific Power
Mr. Lorenzini was elected President of Pacific Power effective January 31,
1992. He had served as Executive Vice President of Pacific Power since January
1989 and as Vice President since July 1987.
Charles E. Robinson, born December 3, 1933, Chairman, President and Chief
Executive Officer of Pacific Telecom, Inc. and Chairman, President and Director
of Alascom, Inc.
Mr. Robinson was elected Chairman of Pacific Telecom, Inc. in February 1989.
He has been serving as Chief Executive Officer since April 1985 and served as
President from April 1985 to October 1990. He resumed the role of President on
December 31, 1992. He served as Director, President and Chief Operating Officer
of Pacific Telecom, Inc. from April 1982 to April 1985.
Verl R. Topham, born August 25, 1934, President of Utah Power
Mr. Topham became President of Utah Power in February 1990. He had served as
Executive Vice President of Electric Operations since May 1989, as well as
Executive Vice President of Utah Power since January 1989, and Senior Vice
President, Chief Financial Officer, Commercial Manager and Director of Utah
Power since 1984.
OTHER PACIFICORP EXECUTIVE OFFICERS
Jacqueline S. Bell, born November 17, 1941, Controller of the Company,
PacifiCorp Holdings, Inc. and PacifiCorp Financial Services, Inc.
Ms. Bell became Controller of the Company in June 1989, of PacifiCorp
Holdings, Inc. in June 1989 and of PacifiCorp Financial Services, Inc. in
October 1993. She had been Manager, Corporate Accounting and Reporting since
1984.
John A. Bohling, born June 23, 1943, Senior Vice President of the Company
Mr. Bohling was elected Senior Vice President of the Company in February
1993. He served as Executive Vice President of Pacific Power since September
1991, Senior Vice President of Utah Power since February 1990, as Vice President
of Utah Power since January 1989 and Assistant Vice President, Commercial
Operations since 1985.
Shelley R. Faigle, born June 8, 1951, Senior Vice President of the Company
Ms. Faigle was elected Senior Vice President of the Company in November
1993. She had previously served as Vice President since February 1992, as Vice
President of Pacific Power since 1989 and as Assistant Vice President of Utah
Power since 1986.
Harry A. Haycock, born May 6, 1935, Senior Vice President of the Company
Mr. Haycock was elected Senior Vice President of the Company in February
1992. He had served as Executive Vice President of Electric Operations since
December 1990, as Senior Vice President of Utah Power since January 1989 and as
Vice President of Utah Power since 1981.
Thomas J. Imeson, born March 20, 1950, Vice President of the Company
Mr. Imeson was elected Vice President of the Company in February 1992. He
had served as Vice President of Electric Operations since 1990. He had
previously served as Chief of Staff for Oregon Governor Neil Goldschmidt since
1987. He was Federal Affairs Manager for Pacific Power during 1985 and 1986.
Robert F. Lanz, born October 30, 1942, Vice President of the Company
Mr. Lanz was elected Vice President of the Company in 1980. He served as
Treasurer of the Company from June 1984 to December 1993.
Sally A. Nofziger, born July 5, 1936, Vice President and Corporate Secretary
of the Company, Secretary of PacifiCorp Holdings, Inc. and PacifiCorp Financial
Services, Inc.
15
Mrs. Nofziger was elected Vice President of the Company in 1989 and has been
Corporate Secretary since 1983.
Richard T. O'Brien, born March 20, 1954, Vice President of the Company
Mr. O'Brien was elected Vice President of the Company in August 1993. He had
previously served as Senior Vice President, Treasurer and Chief Financial
Officer of NERCO, Inc., a former subsidiary of the Company, during 1992 and 1993
and Vice President and Treasurer of NERCO from 1989 to 1992.
William E. Peressini, born May 23, 1956, Treasurer of the Company
Mr. Peressini was elected Treasurer of the Company in January 1994. Prior to
his election at PacifiCorp, he served as Executive Vice President of PacifiCorp
Financial Services, Inc. from January 1992 and as Senior Vice President and
Chief Financial Officer of that company since 1989.
Daniel L. Spalding, born December 23, 1953, Senior Vice President of the
Company and Vice President of PacifiCorp Holdings, Inc.
Mr. Spalding was elected Senior Vice President of the Company in February
1992. He had previously served as Vice President since October 1987.
Dennis P. Steinberg, born December 5, 1946, Vice President of the Company
Mr. Steinberg was elected Vice President of the Company in February 1992. He
had previously served as Vice President of Electric Operations since August
1990, and has held various positions in power resource planning since joining
the Company in 1978.
OTHER EXECUTIVE OFFICERS OF UTAH POWER
John E. Mooney, born March 9, 1937, Executive Vice President of Utah Power
Mr. Mooney was elected Executive Vice President of Utah Power in September
1991. He had previously served as Vice President of Pacific Power since August
1990 and as Assistant Vice President since 1985.
OTHER EXECUTIVE OFFICERS OF PACIFIC POWER
Diana E. Snowden, born October 29, 1947, Senior Vice President of Pacific
Power
Ms. Snowden was elected Senior Vice President of Pacific Power in May 1993.
She had served as Vice President of Pacific Power since 1986.
PART II
ITEM 5. MARKET FOR REGISTRANT'S COMMON EQUITY AND RELATED STOCKHOLDER MATTERS
The information required by this item is included under "Summary
Information" and "Quarterly Financial Data" on pages 20 and 53 of the Company's
Annual Report to Shareholders and is incorporated herein by this reference.
ITEM 6. SELECTED FINANCIAL DATA
The information required by this item is included under "Summary
Information" and "Financing Activities" on pages 20 and 26 of the Company's
Annual Report to Shareholders and is incorporated herein by this reference.
ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS
The information required by this item is included under "Summary
Information," "Liquidity and Capital Resources," "Electric Operations,"
"Telecommunications," "Other" and "Discontinued Operations" on pages 20 through
35 of the Company's Annual Report to Shareholders and is incorporated herein by
this reference.
16
ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
The information required by this item is incorporated by this reference from
the Company's Annual Report to Shareholders or filed with this Report as listed
in Item 14 hereof.
ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
FINANCIAL DISCLOSURE
No information is required to be reported pursuant to this item.
PART III
ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT
The information required by this item with respect to the Company's
directors is incorporated herein by this reference to "Election of Directors" in
the Proxy Statement for the 1994 Annual Meeting of Shareholders. The information
required by this item with respect to the Company's executive officers is set
forth in Part I of this report under Item 4A. The information required by this
item with respect to compliance with Section 16(a) of the Securities Exchange
Act of 1934 is incorporated herein by this reference to "Compliance within
Section 16(a) of the Securities Exchange Act of 1934" in the Proxy Statement
next for the 1994 Annual Meeting of Shareholders.
ITEM 11. EXECUTIVE COMPENSATION
The information required by this item is incorporated herein by this
reference to "Executive Compensation" in the Proxy Statement for the 1994 Annual
Meeting of Shareholders.
ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The information required by this item is incorporated herein by this
reference to "Security Ownership of Certain Beneficial Owners and Management" in
the Proxy Statement for the 1994 Annual Meeting of Shareholders.
ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
The information required by this item is incorporated herein by this
reference to "Director Compensation and Certain Transactions" in the Proxy
Statement for the 1994 Annual Meeting of Shareholders.
PART IV
ITEM 14. EXHIBITS, FINANCIAL STATEMENT SCHEDULES, AND REPORTS ON FORM 8-K
PAGE
REFERENCES
----------
(a) 1. Index to Consolidated Financial Statements:
Independent Auditors' Report.................................................. 36
Statements of consolidated income and retained earnings for each of the three
years ended December 31, 1993................................................ 37
Consolidated balance sheets at December 31, 1993 and 1992..................... 38
Statements of consolidated cash flows for each of the three years ended
December 31, 1993............................................................ 40
Notes to consolidated financial statements.................................... 41
2. Schedules:**
Independent Auditors' Report.................................................. 22
II -- Amounts receivable from related parties and underwriters, promoters and
employees (other than related parties) for the three years ended December 31,
1993......................................................................... 23
V -- Property, plant and equipment for the three years ended December 31,
1993......................................................................... 24
17
VI -- Accumulated depreciation, depletion and amortization of property, plant
and equipment for the three years ended December 31, 1993.................... 27
VIII -- Valuation and qualifying accounts for the three years ended December
31, 1993..................................................................... 30
IX -- Short-term borrowings for the three years ended December 31, 1993....... 31
X -- Supplementary income statement information for the three years ended
December 31, 1993............................................................ 32
<FN>
- ------------------------
* Page references are to the incorporated portion of the Annual Report to
Shareholders of the Registrant for the year ended December 31, 1993, which
portion is appended hereto.
** All other schedules have been omitted because of the absence of the
conditions under which they are required or because the required
information is included elsewhere in the financial statements incorporated
by reference herein.
3. Exhibits:
*(3)a -- Second Restated Articles of Incorporation of the Company, as amended. (Exhibit
(3)a, Form 10-K for fiscal year ended December 31, 1993, File No. 1-5152).
(3)b -- Bylaws of the Company (as restated and amended November 17, 1993).
*(4)a -- Mortgage and Deed of Trust dated as of January 9, 1989, between the Company and
Morgan Guaranty Trust Company of New York ("Morgan Guaranty"), Trustee, as
supplemented and modified by eight Supplemental Indentures (Exhibit 4-E, Form
8-B, File No. 1-5152; Exhibit (4)(b), File No. 33-31861; Exhibit (4)(a), Form
8-K dated January 9, 1990, File No. 1-5152; Exhibit 4(a), Form 8-K dated
September 11, 1991, File No. 1-5152; Exhibit 4(a), Form 8-K dated January 7,
1992, File No. 1-5152; Exhibit 4(a), Form 10-Q for the quarter ended March 31,
1992, File No. 1-5152; and Exhibit 4(a), Form 10-Q for the quarter ended
September 30, 1992, File No. 1-5152; Exhibit 4(a), Form 8-K dated April 1,
1993, File No. 1-5152; and Exhibit 4(a), Form 10-Q for the quarter ended
September 30, 1993, File No. 1-5151).
*(4)b -- Mortgage and Deed of Trust dated as of July 1, 1947, between Pacific Power &
Light Company and Guaranty Trust Company of New York (Morgan Guaranty,
successor) and Oliver R. Brooks et al. (resigned) Trustees, as supplemented and
modified by fifty-one Supplemental Indentures (Exhibit 7(d), File No. 2-7118;
Exhibit 7(b), File No. 2-8354; Exhibit 4(b)-3, File No. 2-9446; Exhibit 4(b)-4,
File No. 2-9809; Exhibit 4(b)-5, File No. 2-10731; Exhibit 4(b)-6, File No.
2-11022; Exhibit 4(b)-7, File No. 2-12576; Exhibit 4(b)-8, File No. 2-13403;
Exhibit 4(b)-2, File No. 2-13793; Exhibit 4(b)-2, File No. 2-14125; Exhibit
4(b)-2, File No. 2-14706; Exhibit 4(b)-2, File No. 2-16843; Exhibit 4(b)-2,
File No. 2-19841; Exhibit 4(b)-2, File No. 2-20797; Exhibit 4(b)-3, File No.
2-20797; Exhibit 4(b)-2, File No. 2-15327; Exhibit 4(b)-2, File No. 2-21488;
Exhibit 4(b)-2, File No. 2-15327; Exhibit 4(b)-2, File No. 2-23922; Exhibit
4(b)-5, File No. 2-15327; Exhibit 4(b)-2, File No. 2-32390; Exhibit 4(b)-2,
File No. 2-34731; Exhibit 2(b)-1, File No. 2-37436; Exhibit 2(b)-4, Thirteenth
Amendment, File No. 2-15327; Exhibit 5(gg), File No. 2-43377; Exhibit 2(b)-1,
File No. 2-45648; Exhibit 2(b)-1, File No. 2-49808; Exhibit 2(b)-1, File No.
2-52039; Exhibit 2, Form 8-K for the month of June 1975, File No. 1-5152;
Exhibit 2, Form 8-K for the month of January 1976, File No. 1-5152; Exhibit
3(c), Form 8-K for the month of July 1976, File No. 1-5152; Exhibit 2, Form 8-K
for the month of December 1976, File No. 1-5152; Exhibit 3(c), Form 8-K for the
month of January 1977, File No. 1-5152; Exhibit 5(yy), File No. 2-60582;
Exhibit 5(m)-2, File No. 2-66153; Exhibit 4(a)-2, File No. 2-70905; Exhibit
(4)a, Form 10-K for the fiscal year ended December 31, 1980, File No. 1-5152;
Exhibit 4(b), Form 10-K for the fiscal year ended December 31, 1981, File No.
1-5152; Exhibit (4)b, Form 10-K for the fiscal year ended December 31, 1982,
File No. 1-5152; Exhibit (4)b, File No. 2-82676; Exhibit (4)b, Form 10-K for
the fiscal year ended December 31, 1985, File No. 1-5152; Exhibit 4, Form 8-K
dated July 25, 1986, File
18
No. 1-5152; Exhibit 4, Form 8-K dated May 18, 1988, File No. 1-5152; Exhibit
4(a), Form 8-K dated January 9, 1989, File No. 1-5152; Exhibit (4)(d), File No.
33-31861; Exhibit (4)(b), Form 8-K dated January 9, 1990, File No. 1-5152;
Exhibit 4(b), Form 8-K dated September 11, 1991, File No. 1-5152; Exhibit 4(b),
Form 8-K dated January 7, 1992, File No. 1-5152; Exhibit 4(b), Form 10-Q for
the quarter ended March 31, 1992, File No. 1-5152; Exhibit 4(b), Form 10-Q for
the quarter ended September 30, 1992, File No. 1-5152; Exhibit 4(b), Form 8-K
dated April 1, 1993, File No. 1-5152; and Exhibit 4(b), Form 10-Q for the
quarter ended September 30, 1993, File No. 1-5152).
*(4)c -- Mortgage and Deed of Trust dated as of December 1, 1943, between Utah Power &
Light Company and Guaranty Trust Company of New York (Morgan Guaranty,
successor) and Arthur E. Burke et al. (resigned) Trustees, as supplemented and
modified by fifty-three Supplemental Indentures (Exhibits 7(a), 7(b) and 7(e),
File No. 2-6245; Exhibit 7(a), File No. 2-7420; Exhibit 7(a), File No. 2-7880;
Exhibit 7(a), File No. 2-8057; Exhibit 7(g), File No. 2-8564; Exhibit 7(h),
File No. 2-9121; Exhibit 4(d), File No. 2-9796; Exhibit 4(d), File No. 2-10707;
Exhibit 4(d), File No. 2-11822; Exhibit 4(d), File No. 2-13560; Exhibit 4(d),
File No. 2-16861; Exhibit 4(d), File No. 2-20176; Exhibit 2(c), File No.
2-21141; Exhibit 2(c), File No. 2-59660; Exhibit 2(e), File No. 2-28131;
Exhibit 2(e), File No. 2-59660; Exhibit 2(e), File No. 2-36342; Exhibit 2(e),
File No. 2-39394; Exhibits 2(h) and 2(i), File No. 2-59660; Exhibit 2(d), File
No. 2-51736; Exhibit 2(c), File No. 2-54812; Exhibit 2(c), File No. 2-55331;
Exhibit 2(c), File No. 2-55762; Exhibit 2(d), File No. 2-56990; Exhibit 2(e),
File No. 2-56990; Exhibits 2(c) and 2(d), File No. 2-58227; Exhibit 2(r), File
No. 2-59660; Exhibits 2(c) and 2(d), File No. 2-61221; Exhibit 2(c), File No.
2-63813; Exhibit 2(c), File No. 2-65221; Exhibit 2(c)-1, File No. 2-66680;
Exhibits 4(b) and 4(c)-1, File No. 2-74773; Exhibit 4(d), File No. 2-80100;
Exhibits 4(d)-2 and 4(d)-3, File No. 2-76293; Exhibit 4(b), File No. 33-9932;
Exhibit 4(b), File No. 33-13207; Exhibits 4(a) and 4(b), File No. 33-01890;
Exhibit 4(b), Form 8-K dated January 9, 1989, File No. 1-5152; Exhibit (4)(f),
File No. 33-31861; Exhibit (4)(c), Form 8-K dated January 9, 1990, File No.
1-5152; Exhibit 4(c), Form 8-K dated September 11, 1991, File No. 1-5152;
Exhibit 4(c), Form 8-K dated January 7, 1992, File No. 1-5152; Exhibit 4(c),
Form 10-Q for the quarter ended March 31, 1992, File No. 1-5152; Exhibit 4(c),
Form 10-Q for the quarter ended September 30, 1992, File No. 1-5152; Exhibit
4(c), Form 8-K dated April 1, 1993, File No. 1-5152; and Exhibit 4(c), Form
10-Q for the quarter ended September 30, 1993, File No. 1-5152).
(4)d -- Second Restated Articles of Incorporation, as amended, and Bylaws. See (3)a and
(3)b above.
In reliance upon item 601(4)(iii) of Regulation S-K, various instruments
defining the rights of holders of long-term debt of the Registrant and its
subsidiaries are not being filed because the total amount authorized under each
such instrument does not exceed 10 percent of the total assets of the
Registrant and its subsidiaries on a consolidated basis. The Registrant hereby
agrees to furnish a copy of any such instrument to the Commission upon request.
*+(10)a -- PacifiCorp Deferred Compensation Payment Plan (Exhibit 10-F, Form 10-K for
fiscal year ended December 31, 1992, File No. 1-8749).
*+(10)b -- Pacific Telecom Executive Bonus Plan, dated October 26, 1990 (Exhibit 10B, Form
10-K for the fiscal year ended December 31, 1990, File No. 0-873).
*+(10)c -- PacifiCorp PerformanceShare Officers' Annual Incentive Plan (Exhibit (10)c, Form
10-K for fiscal year ended December 31, 1993. File No. 1-5152).
*+(10)d -- PacifiCorp Non-Employee Directors' Stock Compensation Plan dated August 1, 1985,
as amended. (Exhibit (10)h, Form 10-K for fiscal year ended December 31, 1988,
File No. 1-5152).
19
*+(10)e -- PacifiCorp Long Term Incentive Plan, 1993 Restatement (Exhibit 10G, Form 10-K
for the year ended December 31, 1993, File No. 0-873).
*+(10)f -- Form of Restricted Stock Agreement under PacifiCorp Long Term Incentive Plan
(Exhibit 10H, Form 10-K for the year ended December 31, 1993, File No. 0-873).
*+(10)g -- PacifiCorp Supplemental Executive Retirement Plan 1988 Restatement (Exhibit
(10)q, Form 10-K for the fiscal year ended December 31, 1987, File No. 1-5152).
*+(10)h -- PacifiCorp Executive Severance Plan (Exhibit (10)m, Form 10-K for fiscal year
ended December 31, 1988, File No. 1-5152).
*+(10)i -- Pacific Telecom Executive Deferred Compensation Plan dated as of January 1, 1994
(Exhibit 10L, Form 10-K for the year ended December 31, 1993, File No. 0-873).
*+(10)j -- Pacific Telecom Long Term Incentive Plan 1994 Restatement dated as of January 1,
1994 (Exhibit 10F, Form 10-K for the fiscal year ended December 31, 1993, File
No. 0-873).
+(10)k -- Incentive Compensation Agreement dated as of February 1, 1994 between PacifiCorp
and Frederick W. Buckman.
*+(10)l -- Restricted Stock Agreement dated as of December 3, 1992 between PacifiCorp and
A. M. Gleason (Exhibit (10)k, Form 10-K for the fiscal year ended December 31,
1992, File No. 1-8749).
+(10)m -- Compensation Agreement dated as of February 9, 1994 between PacifiCorp and Keith
R. McKennon.
*(10)n -- Short-Term Surplus Firm Capacity Sale Agreement executed July 9, 1992 by the
United States of America Department of Energy acting by and through the
Bonneville Power Administration and Pacific Power & Light Company (Exhibit
(10)n, Form 10-K for the fiscal year ended December 31, 1992, File No. 1-8749).
(12) -- Computation of Ratio of Earnings to Fixed Charges. (See page S-1.)
(13) -- Portions of Annual Report to Shareholders of the Registrant for the year ended
December 31, 1993 incorporated by reference herein.
(21) -- Subsidiaries. (See pages S-2 through S-4.)
(23) -- Consent of Deloitte & Touche with respect to Annual Report on Form 10-K.
(24) -- Powers of Attorney.
(99) -- "Item 1. Business" and "Item 2. Properties" from the Annual Reports on Form 10-K
of Pacific Telecom, Inc. and PacifiCorp Financial Services, Inc. for the year
ended December 31, 1993.
<FN>
- ------------------------
* Incorporated herein by reference.
+ This exhibit constitutes a management contract or compensatory plan or
arrangement.
(b) Reports on Form 8-K.
On Form 8-K dated October 29, 1993, under "Item 5. Other Events," the
Company filed a press release reporting financial results for the three and
nine-months ended September 30, 1993.
On Form 8-K dated November 19, 1993, under "Item 5. Other Events," the
Company filed a press release issued by Pacific Telecom, Inc., reporting Pacific
Telecom's sale of its shares of common stock of IDB Communications Group, Inc.
On Form 8-K dated January 18, 1994, under "Item 5. Other Events," the
Company filed a press release reporting certain actions taken at its Board of
Directors meeting held on January 17, 1994.
(c) See (a) 3. above.
(d) See (a) 2. above.
20
SIGNATURES
PURSUANT TO THE REQUIREMENTS OF SECTION 13 OR 15(D) OF THE SECURITIES
EXCHANGE ACT OF 1934, THE REGISTRANT HAS DULY CAUSED THIS REPORT TO BE SIGNED ON
ITS BEHALF BY THE UNDERSIGNED THEREUNTO DULY AUTHORIZED.
PACIFICORP
By /s/ FREDERICK W. BUCKMAN
-----------------------------------
Frederick W. Buckman
(PRESIDENT)
Date: March 30, 1994
PURSUANT TO THE REQUIREMENTS OF THE SECURITIES EXCHANGE ACT OF 1934, THIS
REPORT HAS BEEN SIGNED BELOW BY THE FOLLOWING PERSONS ON BEHALF OF THE
REGISTRANT AND IN THE CAPACITIES AND ON THE DATES INDICATED.
SIGNATURE TITLE DATE
- ----------------------------------------------------- ------------------------------------- ------------------
/s/ FREDERICK W. BUCKMAN
------------------------------------------ President, Chief Executive Officer
Frederick W. Buckman and Director March 30, 1994
(President)
/s/ WILLIAM J. GLASGOW
------------------------------------------ Senior Vice President and Chief
William J. Glasgow Financial Officer March 30, 1994
(Senior Vice President)
/s/ DANIEL L. SPALDING
------------------------------------------ Senior Vice President (Chief
Daniel L. Spalding Accounting Officer) March 30, 1994
(Senior Vice President)
*C. M. BISHOP, JR.
------------------------------------------
C. M. Bishop, Jr.
*C. TODD CONOVER
------------------------------------------
C. Todd Conover
*RICHARD C. EDGLEY
------------------------------------------
Richard C. Edgley
*A. M. GLEASON
------------------------------------------
A. M. Gleason
(Vice Chairman)
*JOHN C. HAMPTON
------------------------------------------
John C. Hampton
*STANLEY K. HATHAWAY
------------------------------------------ Director March 30, 1994
Stanley K. Hathaway
*NOLAN E. KARRAS
------------------------------------------
Nolan E. Karras
*KEITH R. MCKENNON
------------------------------------------
Keith R. McKennon
(Chairman)
*DON M. WHEELER
------------------------------------------
Don M. Wheeler
*NANCY WILGENBUSCH
------------------------------------------
Nancy Wilgenbusch
*By /s/ C. M. BISHOP, JR.
-------------------------------------
C. M. Bishop, JR.
(Attorney-in-Fact)
21
INDEPENDENT AUDITORS' REPORT
PacifiCorp:
We have audited the consolidated financial statements of PacifiCorp and
subsidiaries as of December 31, 1993 and 1992, and for each of the three years
in the period ended December 31, 1993, and have issued our report thereon dated
February 18, 1994 (which expresses an unqualified opinion and includes an
explanatory paragraph relating to changes adopted in accounting for income taxes
and other postretirement benefits); such consolidated financial statements and
report are included in your 1993 Annual Report to Shareholders and are
incorporated herein by reference. Our audits also included the consolidated
financial statement schedules of PacifiCorp and subsidiaries, listed in Item 14.
These consolidated financial statement schedules are the responsibility of the
Company's management. Our responsibility is to express an opinion based on our
audits. In our opinion, such financial statement schedules, when considered in
relation to the basic financial statements taken as a whole, present fairly in
all material respects the information set forth therein.
DELOITTE & TOUCHE
Portland, Oregon
February 18, 1994
22
PACIFICORP
SCHEDULE II -- AMOUNTS RECEIVABLE FROM RELATED
PARTIES AND UNDERWRITERS, PROMOTERS AND EMPLOYEES OTHER THAN RELATED PARTIES
(MILLIONS OF DOLLARS)
COLUMN A COLUMN B COLUMN C COLUMN D COLUMN E
-------------------- ---------- --------- --------- -----------
BALANCE AT
DEDUCTIONS END OF PERIOD
BALANCE AT ---------------------- ----------------
BEGINNING AMOUNTS AMOUNTS NOT
NAME OF DEBTOR OF PERIOD ADDITIONS COLLECTED WRITTEN OFF CURRENT CURRENT DUE
-------------------- ---------- --------- --------- ----------- ------- ------- ------
YEAR ENDED DECEMBER 31, 1993 (1)
YEAR ENDED DECEMBER 31, 1992 (1)
YEAR ENDED DECEMBER 31, 1991
PacifiCorp Financial Services...... Michael C. Henderson
(mortgage) $ -- $ 0.2 $ 0.2 -- -- -- Bridge
----- --- ---
----- --- ---
INTEREST COLLATERAL
-------- ----------
YEAR ENDED DECEMBER 31, 1993 (1)
YEAR ENDED DECEMBER 31, 1992 (1)
YEAR ENDED DECEMBER 31, 1991
PacifiCorp Financial Services......
N/A N/A
<FN>
- --------------------------
(1) Information omitted because indebtedness does not exceed $100,000 or 1% of
total assets.
23
PACIFICORP
SCHEDULE V -- PROPERTY, PLANT AND EQUIPMENT
YEAR ENDED DECEMBER 31, 1992
(MILLIONS OF DOLLARS)
COLUMN A COLUMN B COLUMN C COLUMN D COLUMN E COLUMN F
-------------------------------------------------- ------------ -------- ----------- --------- ----------
BALANCE AT RETIREMENTS TRANSFERS BALANCE AT
BEGINNING OF ADDITIONS OR SALES AND OTHER ENDING OF
CLASSIFICATION PERIOD AT COST AT COST CHANGES PERIOD
-------------------------------------------------- ------------ -------- ----------- --------- ----------
Electric Operations:
Electric Plant in Service.......................
Production.................................... $ 4,171.5 $ 105.4 $ 20.7 $ 25.4 $ 4,281.6
Transmission.................................. 1,738.2 164.6 9.5 (1.5) 1,891.8
Distribution.................................. 2,280.5 205.2 31.6 1.0 2,455.1
General....................................... 884.2 107.7 19.1 (24.5) 948.3
Other......................................... 121.0 6.9 1.2 134.6 261.3
Nonutility Plant................................ 132.7 31.1 2.1 0.8 162.5
Pacific Telecom:
Telecommunications Plant in Service
Central office equipment...................... 527.2 44.4 42.8 (0.2) 528.6
Poles, cable and conduit...................... 520.0 42.3 6.9 0.6 556.0
Earth stations, buildings and towers.......... 328.5 7.6 19.1 1.0 318.0
Satellite..................................... -- 7.8 -- -- 7.8
Other......................................... 218.9 14.6 10.5 (1.3) 221.7
Nonutility Plant................................ 15.9 2.0 0.1 -- 17.8
Other............................................. 65.6 2.5 3.0 0.7 65.8
Construction Work in Progress..................... 305.1 52.3 0.6 -- 356.8
------------ -------- ----------- --------- ----------
$ 11,309.3 $ 794.4 $ 167.2 $ 136.6 $ 12,073.1
------------ -------- ----------- --------- ----------
------------ -------- ----------- --------- ----------
24
PACIFICORP
SCHEDULE V -- PROPERTY, PLANT AND EQUIPMENT (CONTINUED)
YEAR ENDED DECEMBER 31, 1992
(MILLIONS OF DOLLARS)
COLUMN A COLUMN B COLUMN C COLUMN D COLUMN E COLUMN F
- -------------------------------------------------- ------------ --------- ----------- --------- ----------
BALANCE AT RETIREMENTS TRANSFERS BALANCE AT
BEGINNING OF ADDITIONS OR SALES AND OTHER ENDING OF
CLASSIFICATION PERIOD AT COST AT COST CHANGES PERIOD
- -------------------------------------------------- ------------ --------- ----------- --------- ----------
Electric Operations:
Electric Plant in Service
Production $ 3,862.2 $ 353.6 $ 24.2 $ (20.1) $ 4,171.5
Transmission.................................. 1,627.2 120.6 10.4 0.8 1,738.2
Distribution.................................. 2,106.8 206.9 32.6 (0.6) 2,280.5
General....................................... 824.1 96.6 37.0 0.5 884.2
Other......................................... 135.3 2.5 0.5 (16.3) 121.0
Nonutility Plant................................ 140.8 9.9 5.9 (12.1) 132.7
Pacific Telecom:
Telecommunications Plant in Service.............
Central office equipment 517.0 57.7 46.2 (1.3) 527.2
Poles, cable and conduit...................... 497.5 34.6 12.0 (0.1) 520.0
Earth stations, buildings and towers.......... 329.4 13.7 15.1 0.5 328.5
Satellite..................................... 84.6 -- 84.6 -- --
Other......................................... 205.5 28.1 15.2 0.5 218.9
Nonutility Plant................................ 17.5 0.3 2.3 0.4 15.9
Other............................................. 23.0 -- -- 42.6 65.6
Construction Work in Progress..................... 323.5 23.4 -- (41.8) 305.1
------------ --------- ----------- --------- ----------
$ 10,694.4 $ 947.9 $ 286.0 $ (47.0) $ 11,309.3
------------ --------- ----------- --------- ----------
------------ --------- ----------- --------- ----------
25
PACIFICORP
SCHEDULE V -- PROPERTY, PLANT AND EQUIPMENT (CONTINUED)
YEAR ENDED DECEMBER 31, 1991
(MILLIONS OF DOLLARS)
COLUMN A COLUMN B COLUMN C COLUMN D COLUMN E COLUMN F
- -------------------------------------------------- ------------ ---------- ----------- ----------- ----------
BALANCE AT RETIREMENTS TRANSFERS BALANCE AT
BEGINNING OF ADDITIONS OR SALES AND OTHER ENDING OF
CLASSIFICATION PERIOD AT COST AT COST CHANGES PERIOD
- -------------------------------------------------- ------------ ---------- ----------- ----------- ----------
Electric Operations:
Electric Plant in Service
Production.................................... $ 3,524.3 $ 540.0 $ 19.3 $(182.8) $ 3,862.2
Transmission.................................. 1,532.6 99.8 4.5 (0.7) 1,627.2
Distribution.................................. 1,993.4 130.9 17.7 0.2 2,106.8
General....................................... 708.8 149.7 33.9 (0.5) 824.1
Other......................................... 151.2 35.7 2.2 (49.4) 135.3
Nonutility Plant................................ 18.3 0.4 0.7 122.8 140.8
Pacific Telecom:
Telecommunications Plant in Service
Central office equipment...................... 489.0 80.8 52.9 0.1 517.0
Poles, cable and conduit...................... 408.8 94.2 5.7 0.2 497.5
Earth stations, buildings and towers.......... 318.9 27.2 20.2 3.5 329.4
Satellite..................................... 81.2 84.6 81.2 -- 84.6
Other......................................... 185.7 36.7 16.1 (0.8) 205.5
Nonutility Plant................................ 22.0 0.6 5.4 0.3 17.5
Other............................................. 34.7 9.0 20.7 -- 23.0
Construction Work in Progress..................... 378.4 (56.1) -- 1.2 323.5
------------ ---------- ----------- ----------- ----------
$ 9,847.3 $ 1,233.5 $ 280.5 $(105.9)(1) $ 10,694.4
------------ ---------- ----------- ----------- ----------
------------ ---------- ----------- ----------- ----------
<FN>
- ------------------------
(1) Includes transfers and other miscellaneous adjustments and $182.8 million
for the termination of a capital lease related to a generating plant.
Column C Additions at Cost includes $225.7 million for the purchase of the
formerly leased plant.
26
PACIFICORP
SCHEDULE VI -- ACCUMULATED DEPRECIATION, DEPLETION AND AMORTIZATION OF
PROPERTY, PLANT AND EQUIPMENT
YEAR ENDED DECEMBER 31, 1993
(MILLIONS OF DOLLARS)
COLUMN A COLUMN B COLUMN C COLUMN D COLUMN E COLUMN F
- -------------------------------------------------- ------------ ---------- ----------- --------- ----------
ADDITIONS OTHER
BALANCE AT CHARGED TO CHANGES BALANCE AT
BEGINNING OF COSTS AND ADD END OF
CLASSIFICATION PERIOD EXPENSES RETIREMENTS (DEDUCT) PERIOD
- -------------------------------------------------- ------------ ---------- ----------- --------- ----------
Electric Operations:
Electric Plant in Service
Production.................................... $ 1,299.7 $ 100.9 $ 23.5 $ 167.9 $ 1,545.0
Transmission.................................. 421.4 40.7 12.5 9.1 458.7
Distribution.................................. 634.4 78.3 52.2 6.1 666.6
General....................................... 275.1 47.0 17.7 0.6 305.0
Nonutility Plant and Other...................... 121.0 21.2 2.2 0.4 140.4
Pacific Telecom:
Telecommunications Plant
Central office equipment...................... 228.9 45.7 31.0 0.3 243.9
Poles, cable and conduit...................... 198.2 30.7 7.5 -- 221.4
Earth stations, buildings and towers.......... 169.8 17.9 17.8 0.3 170.2
Satellite..................................... -- 0.2 -- -- 0.2
Nonutility and Other............................ 99.1 14.3 7.5 (0.6) 105.3
Other............................................. 4.1 2.7 0.2 0.2 6.8
------------ ---------- ----------- --------- ----------
$ 3,451.7 $ 399.6 $ 172.1 $ 184.3 $ 3,863.5
------------ ---------- ----------- --------- ----------
------------ ---------- ----------- --------- ----------
27
PACIFICORP
SCHEDULE VI -- ACCUMULATED DEPRECIATION, DEPLETION AND AMORTIZATION OF
PROPERTY, PLANT AND EQUIPMENT
YEAR ENDED DECEMBER 31, 1992
(MILLIONS OF DOLLARS)
COLUMN A COLUMN B COLUMN C COLUMN D COLUMN E COLUMN F
- -------------------------------------------------- ------------ ---------- ----------- --------- ----------
ADDITIONS OTHER
BALANCE AT CHARGED TO CHANGES BALANCE AT
BEGINNING OF COSTS AND ADD END OF
CLASSIFICATION PERIOD EXPENSES RETIREMENTS (DEDUCT) PERIOD
- -------------------------------------------------- ------------ ---------- ----------- --------- ----------
Electric Operations:
Electric Plant in Service
Production.................................... $ 1,214.8 $ 115.5 $ 26.6 $ (4.0) $ 1,299.7
Transmission.................................. 396.9 35.8 12.8 1.5 421.4
Distribution.................................. 602.6 77.3 49.1 3.6 634.4
General....................................... 258.7 48.9 32.7 0.2 275.1
Nonutility Plant and Other...................... 117.6 19.6 3.2 (13.0) 121.0
Pacific Telecom:
Telecommunications Plant
Central office equipment...................... 225.3 45.6 41.7 (0.3) 228.9
Poles, cable and conduit...................... 174.9 28.4 5.1 -- 198.2
Earth stations, buildings and towers.......... 160.7 17.8 9.0 0.3 169.8
Satellite..................................... 4.2 7.3 11.5 -- --
Nonutility and Other............................ 96.2 13.8 11.0 0.1 99.1
Other............................................. 4.6 1.1 -- (1.6) 4.1
------------ ---------- ----------- --------- ----------
$ 3,256.5 $ 411.1 $ 202.7 $ (13.2) $ 3,451.7
------------ ---------- ----------- --------- ----------
------------ ---------- ----------- --------- ----------
28
PACIFICORP
SCHEDULE VI -- ACCUMULATED DEPRECIATION, DEPLETION AND AMORTIZATION OF
PROPERTY, PLANT AND EQUIPMENT
YEAR ENDED DECEMBER 31, 1991
(MILLIONS OF DOLLARS)
COLUMN A COLUMN B COLUMN C COLUMN D COLUMN E COLUMN F
- -------------------------------------------------- ------------ ---------- ----------- --------- ----------
ADDITIONS OTHER
BALANCE AT CHARGED TO CHANGES BALANCE AT
BEGINNING OF COSTS AND ADD END OF
CLASSIFICATION PERIOD EXPENSES RETIREMENTS (DEDUCT) PERIOD
- -------------------------------------------------- ------------ ---------- ----------- --------- ----------
Electric Operations:
Electric Plant in Service
Production.................................... $ 1,129.0 $ 102.4 $ 21.6 $ 5.0 $ 1,214.8
Transmission.................................. 368.8 33.8 7.2 1.5 396.9
Distribution.................................. 558.2 71.5 29.4 2.3 602.6
General....................................... 249.9 42.1 32.9 (0.4) 258.7
Nonutility Plant and Other...................... 49.9 9.8 2.4 60.3 117.6
Pacific Telecom:
Telecommunications Plant
Central office equipment...................... 203.8 54.6 33.1 -- 225.3
Poles, cable and conduit...................... 154.1 27.1 6.4 0.1 174.9
Earth stations, buildings and towers.......... 154.7 22.5 16.7 0.2 160.7
Satellite..................................... 78.1 7.3 81.2 -- 4.2
Nonutility and Other............................ 89.5 17.0 10.0 (0.3) 96.2
Other............................................. 7.2 1.5 4.1 -- 4.6
------------ ---------- ----------- --------- ----------
$ 3,043.2 $ 389.6 $ 245.0 $ 68.7 $ 3,256.5
------------ ---------- ----------- --------- ----------
------------ ---------- ----------- --------- ----------
29
PACIFICORP
SCHEDULE VIII -- VALUATION AND QUALIFYING ACCOUNTS
THREE YEARS ENDED DECEMBER 31, 1993
(MILLIONS OF DOLLARS)
CHARGED
BALANCE AT CHARGED TO TO OTHER
BEGINNING OF COSTS AND ACCOUNTS BALANCE AT
DESCRIPTION PERIOD EXPENSES (1) DESCRIBE DEDUCTIONS (2) END OF PERIOD
- -------------------------------------------------- ------------ ------------ --------- -------------- -------------
Year Ended December 31, 1993:
Accumulated amortization of estimated
recoverable nuclear project costs.............. $ 60.0 $ 1.8 $ -- $ -- $ 61.8
Provisions for credit losses.................... 56.5 2.6 24.6 30.3 53.4
Other reserves.................................. 79.0 14.0 (24.6) 31.8 36.6
Year Ended December 31, 1992
Accumulated amortization of estimated
recoverable nuclear project costs.............. 59.0 1.0 -- -- 60.0
Provisions for credit losses.................... 15.0 77.1 -- 35.6 56.5
Other reserves.................................. 33.4 83.5 -- 37.9 79.0
Year Ended December 31, 1991
Accumulated amortization of estimated
recoverable nuclear project costs.............. 57.9 1.1 -- -- 59.0
Provisions for credit losses.................... 22.1 10.4 -- 17.5 15.0
Other reserves.................................. 21.7 20.2 -- 8.5 33.4
<FN>
- ------------------------
(1) Charged principally to depreciation and amortization, provision for
uncollectible accounts, provision for credit losses and other expense.
(2) Uncollectible amounts written off net of recoveries.
30
PACIFICORP
SCHEDULE IX -- SHORT-TERM BORROWINGS
THREE YEARS ENDED DECEMBER 31, 1993
(MILLIONS OF DOLLARS)
WEIGHTED
WEIGHTED AVERAGE
BALANCE AT AVERAGE MAXIMUM AMOUNT AVERAGE AMOUNT INTEREST RATE
END OF INTEREST RATE OUTSTANDING OUTSTANDING DURING PERIOD
PERIOD (1) DURING PERIOD DURING PERIOD (2)
----------- --------------- --------------- --------------- ---------------
Year Ended December 31, 1993:
Commercial Paper and Other.................. $ 186.9 3.34% $ 531.5 $ 426.9 3.60%
Bank Borrowings............................. 366.5 4.06% 470.8 260.8 3.81%
Year Ended December 31, 1992:
Commercial Paper and Other.................. 342.1 4.17% 421.0 525.2 4.80%
Bank Borrowings............................. 211.3 4.03% 404.6 253.5 4.33%
Year Ended December 31, 1991:
Commercial Paper and Other.................. 307.7 5.24% 429.4 358.8 6.49%
Bank Borrowings............................. 373.4 5.56% 484.9 343.4 6.65%
<FN>
- ------------------------
(1) Computed, by instrument, as the total interest to be paid on principal
amounts outstanding at the end of the period divided by the weighted daily
principal amounts outstanding.
(2) Computed, by instrument, as the total accrued interest for the period
divided by the average daily principal amount outstanding for the period.
31
PACIFICORP
SCHEDULE X -- SUPPLEMENTARY INCOME STATEMENT INFORMATION
THREE YEARS ENDED DECEMBER 31, 1993
(MILLIONS OF DOLLARS)
CHARGED TO COSTS AND EXPENSES
-------------------------------
1993 1992 1991
--------- --------- ---------
Operations Expense:
Royalties.............................................................. $ 30.7 $ 31.6 $ 18.0
Taxes, other than payroll and income taxes:
Property............................................................... 100.8 101.2 87.9
Production............................................................. 27.1 29.4 14.3
Maintenance and depreciation and amortization expenses are disclosed
separately in the consolidated financial statements. Royalty expense is included
in operations expense. Depreciation and amortization of intangible assets is
included in depreciation and amortization expense. Advertising costs are not
material.
32
EXHIBIT (12)
PACIFICORP
STATEMENTS OF COMPUTATION OF RATIO
OF EARNINGS TO FIXED CHARGES
(IN MILLIONS OF DOLLARS)
YEAR ENDED DECEMBER 31,
---------------------------------------------------------
1989 1990 1991 1992 1993
---------- ---------- ---------- --------- ----------
Fixed Charges, as defined:*
Interest expense.................................... $ 473.1 $ 431.2 $ 428.0 $ 409.7 $ 377.8
Estimated interest portion of rentals charged to
expense............................................ 29.9 23.3 20.4 17.1 20.1
Preferred dividend requirement of majority-owned
subsidiary......................................... 4.5 4.2 -- -- --
---------- ---------- ---------- --------- ----------
Total fixed charges............................. $ 507.5 $ 458.7 $ 448.4 $ 426.8 $ 397.9
---------- ---------- ---------- --------- ----------
---------- ---------- ---------- --------- ----------
Earnings, as defined:*
Income from continuing operations................... $ 403.0 $ 413.4 $ 446.8 $ 150.2 $ 422.7
Add (deduct):
Provision for income taxes........................ 207.1 179.1 176.7 90.8 187.4
Minority interest................................. 12.3 18.1 14.1 8.4 11.3
Undistributed losses (income) of less than 50%
owned affiliates................................. 14.7 -- (1.8) (5.7) (16.2)
Fixed charges as above............................ 507.5 458.7 448.4 426.8 397.9
---------- ---------- ---------- --------- ----------
Total earnings.................................. $ 1,144.6 $ 1,069.3 $ 1,084.2 $ 670.5 $ 1,003.1
---------- ---------- ---------- --------- ----------
---------- ---------- ---------- --------- ----------
Ratio of Earnings to Fixed Charges.................... 2.3x 2.3x 2.4x 1.6x 2.5x
---------- ---------- ---------- --------- ----------
---------- ---------- ---------- --------- ----------
<FN>
- ------------------------
* "Fixed charges" represents consolidated interest charges, an estimated amount
representing the interest factor in rents and preferred stock dividend
requirements of majority-owned subsidiaries. "Earnings" represent the
aggregate of (a) income from continuing operations, (b) taxes based on income
from continuing operations, (c) minority interest in the income of
majority-owned subsidiaries that have fixed charges, (d) fixed charges and (e)
undistributed losses (income) of less than 50% owned affiliates without loan
guarantees.
S-1
EXHIBIT (21)
SUBSIDIARIES OF THE COMPANY
PacifiCorp Holdings, Inc., a wholly-owned subsidiary of the Company and a
Delaware corporation, has the following subsidiaries:
STATE OR
JURISDICTION OF
APPROXIMATE PERCENTAGE OF INCORPORATION
NAME OF SUBSIDIARY VOTING SECURITIES OWNED OR ORGANIZATION
- ------------------------------------------------------------------------- ------------------------- ---------------
PACE Group, Inc.......................................................... 100% Oregon
PacifiCorp Financial Services, Inc....................................... 100% Oregon
Color Spot, Inc........................................................ 100% Oregon
Pacific Development, Inc............................................... 100% Oregon
Pacific Harbor Capital, Inc............................................ 100% Delaware
Pacific Relocation Service Company..................................... 100% Oregon
PacifiCorp Capital, Inc................................................ 100% Virginia
PacifiCorp Credit, Inc................................................. 100% Oregon
Vermont Castings, Inc.................................................. 100% Vermont
Pacific Generation Company............................................... 100% Oregon
Energy National, Inc................................................... 100% Utah
ONSITE Energy, Inc..................................................... 100% Oregon
Pacific Telecom, Inc..................................................... 87% Washington
PacifiCorp Trans, Inc.................................................... 100% Oregon
Pacific Telecom, Inc., an 87% owned subsidiary of PacifiCorp Holdings, Inc.,
and a Washington corporation, has the following subsidiaries:
STATE OR
JURISDICTION OF
APPROXIMATE PERCENTAGE OF INCORPORATION OR
NAME OF SUBSIDIARY VOTING SECURITIES OWNED ORGANIZATION
- ----------------------------------------------------------------------- ------------------------- ----------------
Alascom, Inc........................................................... 100% Alaska
Cascade Autovon Company................................................ 100% Washington
Eagle Telecommunications, Inc./Colorado................................ 100% Colorado
Eagle Valley Communications Corporation................................ 100% Colorado
Gem State Utilities Corporation........................................ 92% Idaho
Indianhead Communications Corporation.................................. 100% Wisconsin
Inter Island Telephone Company, Inc.................................... 100% Washington
International Communications Holdings, Inc............................. 85% Delaware
North-West Cellular, Inc............................................... 100% Nevada
North-West Telecommunications, Inc..................................... 100% Nevada
Northland Telephone Company.......................................... 100% Minnesota
North-West Telephone Company......................................... 100% Wisconsin
Postville Telephone Company.......................................... 100% Wisconsin
The Footville Telephone Company...................................... 100% Wisconsin
Sullivan Telephone Company........................................... 100% Wisconsin
Turtle Lake Telephone Company, Inc................................... 100% Wisconsin
S-2
STATE OR
JURISDICTION OF
APPROXIMATE PERCENTAGE OF INCORPORATION OR
NAME OF SUBSIDIARY VOTING SECURITIES OWNED ORGANIZATION
- ----------------------------------------------------------------------- ------------------------- ----------------
Northwestern Telephone Systems, Inc.................................... 99% Oregon
Pacific Telecom Cable, Inc............................................. 80% Delaware
Pacific Telecom Cellular, Inc.......................................... 100% Delaware
Pacific Telecom Cellular of Alaska, Inc.............................. 100% Alaska
Pacific Telecom Cellular of I-5, Inc................................. 100% Washington
Pacific Telecom Cellular of Michigan, Inc............................ 100% Michigan
Pacific Telecom Cellular of Minnesota, Inc........................... 100% Minnesota
Pacific Telecom Cellular of Oregon, Inc.............................. 100% Oregon
Pacific Telecom Cellular of South Dakota, Inc........................ 100% South Dakota
Pacific Telecom Cellular of Washington, Inc.......................... 100% Washington
Pacific Telecom Cellular of Wisconsin, Inc........................... 100% Wisconsin
Pacific Telecom Transmission Services, Inc............................. 100% Oregon
Price County Telephone Cellular, Inc................................... 100% Wisconsin
PTI Broadcasting, Inc.................................................. 100% Oregon
PTI Harbor Bay, Inc.................................................... 100% Washington
Bay Area Teleport, Inc............................................... 100% Delaware
Rib Lake Cellular for Wisconsin RSA #2, Inc............................ 100% Wisconsin
Shell Lake Telephone Company, Inc...................................... 100% Wisconsin
Telephone Utilities of Alaska, Inc..................................... 100% Alaska
Telephone Utilities of Eastern Oregon, Inc............................. 100% Oregon
Telephone Utilities of Northland, Inc.................................. 100% Alaska
Telephone Utilities of Oregon, Inc..................................... 100% Oregon
Telephone Utilities of Washington, Inc................................. 100% Washington
Telephone Utilities of Wyoming, Inc.................................... 100% Wyoming
Thorp Telephone Company................................................ 100% Wisconsin
UpSouth Corporation.................................................... 100% Georgia
Wayside Telecom, Inc................................................... 100% Wisconsin
The Wayside Telephone Company.......................................... 100% Wisconsin
S-3
The Company also has the following subsidiaries:
STATE OR
APPROXIMATE PERCENTAGE JURISDICTION OF
OF VOTING SECURITIES INCORPORATION
NAME OF SUBSIDIARY OWNED OR ORGANIZATION
- ------------------------------------------------------------------------- ----------------------- ---------------
Centralia Mining Company................................................. 100% Washington
Energy West Mining Company............................................... 100% Utah
Glenrock Coal Company.................................................... 100% Wyoming
Interwest Mining Company................................................. 100% Oregon
Pacific Minerals, Inc.................................................... 100% Wyoming
Bridger Coal Company, a joint venture.................................. 66.67% Wyoming
S-4
INDEX TO EXHIBITS
SEQUENTIALLY
EXHIBITS NUMBERED PAGE
- -------------- -------------
*(3)a -- Second Restated Articles of Incorporation of the Company, as amended. (Exhibit
(3)a, Form 10-K for fiscal year ended December 31, 1993, File No. 1-5152)......
(3)b -- Bylaws of the Company (as restated and amended November 17, 1993)...............
*(4)a -- Mortgage and Deed of Trust dated as of January 9, 1989, between the Company and
Morgan Guaranty Trust Company of New York ("Morgan Guaranty"), Trustee, as
supplemented and modified by eight Supplemental Indentures (Exhibit 4-E, Form
8-B, File No. 1-5152; Exhibit (4)(b), File No. 33-31861; Exhibit (4)(a), Form
8-K dated January 9, 1990, File No. 1-5152; Exhibit 4(a), Form 8-K dated
September 11, 1991, File No. 1-5152; Exhibit 4(a), Form 8-K dated January 7,
1992, File No. 1-5152; Exhibit 4(a), Form 10-Q for the quarter ended March 31,
1992, File No. 1-5152; and Exhibit 4(a), Form 10-Q for the quarter ended
September 30, 1992, File No. 1-5152; Exhibit 4(a), Form 8-K dated April 1,
1993, File No. 1-5152; and Exhibit 4(a), Form 10-Q for the quarter ended
September 30, 1993, File No. 1-5151)...........................................
*(4)b -- Mortgage and Deed of Trust dated as of July 1, 1947, between Pacific Power &
Light Company and Guaranty Trust Company of New York (Morgan Guaranty,
successor) and Oliver R. Brooks et al. (resigned) Trustees, as supplemented and
modified by fifty-one Supplemental Indentures (Exhibit 7(d), File No. 2-7118;
Exhibit 7(b), File No. 2-8354; Exhibit 4(b)-3, File No. 2-9446; Exhibit 4(b)-4,
File No. 2-9809; Exhibit 4(b)-5, File No. 2-10731; Exhibit 4(b)-6, File No.
2-11022; Exhibit 4(b)-7, File No. 2-12576; Exhibit 4(b)-8, File No. 2-13403;
Exhibit 4(b)-2, File No. 2-13793; Exhibit 4(b)-2, File No. 2-14125; Exhibit
4(b)-2, File No. 2-14706; Exhibit 4(b)-2, File No. 2-16843; Exhibit 4(b)-2,
File No. 2-19841; Exhibit 4(b)-2, File No. 2-20797; Exhibit 4(b)-3, File No.
2-20797; Exhibit 4(b)-2, File No. 2-15327; Exhibit 4(b)-2, File No. 2-21488;
Exhibit 4(b)-2, File No. 2-15327; Exhibit 4(b)-2, File No. 2-23922; Exhibit
4(b)-5, File No. 2-15327; Exhibit 4(b)-2, File No. 2-32390; Exhibit 4(b)-2,
File No. 2-34731; Exhibit 2(b)-1, File No. 2-37436; Exhibit 2(b)-4, Thirteenth
Amendment, File No. 2-15327; Exhibit 5(gg), File No. 2-43377; Exhibit 2(b)-1,
File No. 2-45648; Exhibit 2(b)-1, File No. 2-49808; Exhibit 2(b)-1, File No.
2-52039; Exhibit 2, Form 8-K for the month of June 1975, File No. 1-5152;
Exhibit 2, Form 8-K for the month of January 1976, File No. 1-5152; Exhibit
3(c), Form 8-K for the month of July 1976, File No. 1-5152; Exhibit 2, Form 8-K
for the month of December 1976, File No. 1-5152; Exhibit 3(c), Form 8-K for the
month of January 1977, File No. 1-5152; Exhibit 5(yy), File No. 2-60582;
Exhibit 5(m)-2, File No. 2-66153; Exhibit 4(a)-2, File No. 2-70905; Exhibit
(4)a, Form 10-K for the fiscal year ended December 31, 1980, File No. 1-5152;
Exhibit 4(b), Form 10-K for the fiscal year ended December 31, 1981, File No.
1-5152; Exhibit (4)b, Form 10-K for the fiscal year ended December 31, 1982,
File No. 1-5152; Exhibit (4)b, File No. 2-82676; Exhibit (4)b, Form 10-K for
the fiscal year ended December 31, 1985, File No. 1-5152; Exhibit 4, Form 8-K
dated July 25, 1986, File No. 1-5152; Exhibit 4, Form 8-K dated May 18, 1988,
File No. 1-5152; Exhibit 4(a), Form 8-K dated January 9, 1989, File No. 1-5152;
Exhibit (4)(d), File No. 33-31861; Exhibit (4)(b), Form 8-K dated January 9,
1990, File No. 1-5152; Exhibit 4(b), Form 8-K dated September 11, 1991, File
No. 1-5152; Exhibit 4(b), Form 8-K dated January 7, 1992, File No. 1-5152;
Exhibit 4(b), Form 10-Q for the quarter ended March 31, 1992, File No. 1-5152;
Exhibit 4(b), Form 10-Q for the quarter ended September 30, 1992, File No.
1-5152; Exhibit 4(b), Form 8-K dated April 1, 1993, File No. 1-5152; and
Exhibit 4(b), Form 10-Q for the quarter ended September 30, 1993, File No.
1-5152)........................................................................
SEQUENTIALLY
EXHIBITS NUMBERED PAGE
- -------------- -------------
*(4)c -- Mortgage and Deed of Trust dated as of December 1, 1943, between Utah Power &
Light Company and Guaranty Trust Company of New York (Morgan Guaranty,
successor) and Arthur E. Burke et al. (resigned) Trustees, as supplemented and
modified by fifty-three Supplemental Indentures (Exhibits 7(a), 7(b) and 7(e),
File No. 2-6245; Exhibit 7(a), File No. 2-7420; Exhibit 7(a), File No. 2-7880;
Exhibit 7(a), File No. 2-8057; Exhibit 7(g), File No. 2-8564; Exhibit 7(h),
File No. 2-9121; Exhibit 4(d), File No. 2-9796; Exhibit 4(d), File No. 2-10707;
Exhibit 4(d), File No. 2-11822; Exhibit 4(d), File No. 2-13560; Exhibit 4(d),
File No. 2-16861; Exhibit 4(d), File No. 2-20176; Exhibit 2(c), File No.
2-21141; Exhibit 2(c), File No. 2-59660; Exhibit 2(e), File No. 2-28131;
Exhibit 2(e), File No. 2-59660; Exhibit 2(e), File No. 2-36342; Exhibit 2(e),
File No. 2-39394; Exhibits 2(h) and 2(i), File No. 2-59660; Exhibit 2(d), File
No. 2-51736; Exhibit 2(c), File No. 2-54812; Exhibit 2(c), File No. 2-55331;
Exhibit 2(c), File No. 2-55762; Exhibit 2(d), File No. 2-56990; Exhibit 2(e),
File No. 2-56990; Exhibits 2(c) and 2(d), File No. 2-58227; Exhibit 2(r), File
No. 2-59660; Exhibits 2(c) and 2(d), File No. 2-61221; Exhibit 2(c), File No.
2-63813; Exhibit 2(c), File No. 2-65221; Exhibit 2(c)-1, File No. 2-66680;
Exhibits 4(b) and 4(c)-1, File No. 2-74773; Exhibit 4(d), File No. 2-80100;
Exhibits 4(d)-2 and 4(d)-3, File No. 2-76293; Exhibit 4(b), File No. 33-9932;
Exhibit 4(b), File No. 33-13207; Exhibits 4(a) and 4(b), File No. 33-01890;
Exhibit 4(b), Form 8-K dated January 9, 1989, File No. 1-5152; Exhibit (4)(f),
File No. 33-31861; Exhibit (4)(c), Form 8-K dated January 9, 1990, File No.
1-5152; Exhibit 4(c), Form 8-K dated September 11, 1991, File No. 1-5152;
Exhibit 4(c), Form 8-K dated January 7, 1992, File No. 1-5152; Exhibit 4(c),
Form 10-Q for the quarter ended March 31, 1992, File No. 1-5152; Exhibit 4(c),
Form 10-Q for the quarter ended September 30, 1992, File No. 1-5152; Exhibit
4(c), Form 8-K dated April 1, 1993, File No. 1-5152; and Exhibit 4(c), Form
10-Q for the quarter ended September 30, 1993, File No. 1-5152)................
(4)d -- Second Restated Articles of Incorporation, as amended, and Bylaws. See (3)a and
(3)b above.....................................................................
In reliance upon item 601(4)(iii) of Regulation S-K, various instruments
defining the rights of holders of long-term debt of the Registrant and its
subsidiaries are not being filed because the total amount authorized under each
such instrument does not exceed 10 percent of the total assets of the
Registrant and its subsidiaries on a consolidated basis. The Registrant hereby
agrees to furnish a copy of any such instrument to the Commission upon request
*+(10)a -- PacifiCorp Deferred Compensation Payment Plan (Exhibit 10-F, Form 10-K for
fiscal year ended December 31, 1992, File No. 1-8749)..........................
*+(10)b -- Pacific Telecom Executive Bonus Plan, dated October 26, 1990 (Exhibit 10B, Form
10-K for the fiscal year ended December 31, 1990, File No. 0-873)..............
*+(10)c -- PacifiCorp PerformanceShare Officers' Annual Incentive Plan (Exhibit (10)c, Form
10-K for fiscal year ended December 31, 1993. File No. 1-5152).................
*+(10)d -- PacifiCorp Non-Employee Directors' Stock Compensation Plan dated August 1, 1985,
as amended. (Exhibit (10)h, Form 10-K for fiscal year ended December 31, 1988,
File No. 1-5152)...............................................................
*+(10)e -- PacifiCorp Long Term Incentive Plan, 1993 Restatement (Exhibit 10G, Form 10-K
for the year ended December 31, 1993, File No. 0-873)..........................
*+(10)f -- Form of Restricted Stock Agreement under PacifiCorp Long Term Incentive Plan
(Exhibit 10H, Form 10-K for the year ended December 31, 1993, File No.
0-873).........................................................................
*+(10)g -- PacifiCorp Supplemental Executive Retirement Plan 1988 Restatement (Exhibit
(10)q, Form 10-K for the fiscal year ended December 31, 1987, File No.
1-5152)........................................................................
SEQUENTIALLY
EXHIBITS NUMBERED PAGE
- -------------- -------------
*+(10)h -- PacifiCorp Executive Severance Plan (Exhibit (10)m, Form 10-K for fiscal year
ended December 31, 1988, File No. 1-5152)......................................
*+(10)i -- Pacific Telecom Executive Deferred Compensation Plan dated as of January 1, 1994
(Exhibit 10L, Form 10-K for the year ended December 31, 1993, File No.
0-873).........................................................................
*+(10)j -- Pacific Telecom Long Term Incentive Plan 1994 Restatement dated as of January 1,
1994 (Exhibit 10F, Form 10-K for the fiscal year ended December 31, 1993, File
No. 0-873).....................................................................
+(10)k -- Incentive Compensation Agreement dated as of February 1, 1994 between PacifiCorp
and Frederick W. Buckman.......................................................
*+(10)l -- Restricted Stock Agreement dated as of December 3, 1992 between PacifiCorp and
A. M. Gleason (Exhibit (10)k, Form 10-K for the fiscal year ended December 31,
1992, File No. 1-8749).........................................................
+(10)m -- Compensation Agreement dated as of February 9, 1994 between PacifiCorp and Keith
R. McKennon....................................................................
*(10)n -- Short-Term Surplus Firm Capacity Sale Agreement executed July 9, 1992 by the
United States of America Department of Energy acting by and through the
Bonneville Power Administration and Pacific Power & Light Company (Exhibit
(10)n, Form 10-K for the fiscal year ended December 31, 1992, File No.
1-8749)........................................................................
(12) -- Computation of Ratio of Earnings to Fixed Charges. (See page S-1.)..............
(13) -- Portions of Annual Report to Shareholders of the Registrant for the year ended
December 31, 1993 incorporated by reference herein.............................
(21) -- Subsidiaries. (See pages S-2 through S-4.)......................................
(23) -- Consent of Deloitte & Touche with respect to Annual Report on Form 10-K.........
(24) -- Powers of Attorney..............................................................
(99) -- "Item 1. Business" and "Item 2. Properties" from the Annual Reports on Form 10-K
of Pacific Telecom, Inc. and PacifiCorp Financial Services, Inc. for the year
ended December 31, 1993........................................................
<FN>
- ------------------------
* Incorporated herein by reference.
+ This exhibit constitutes a management contract or compensatory plan or
arrangement.