EXHIBIT 10.2
AGREEMENT AND PLAN OF MERGER AND REORGANIZATION
THIS AGREEMENT AND PLAN OF MERGER AND REORGANIZATION, dated as of October
___, 2001 (the "Agreement"), by and among NORTHWEST NATURAL GAS COMPANY, an
Oregon corporation ("NW Natural"), NORTHWEST ENERGY CORPORATION, an Oregon
corporation and a wholly-owned subsidiary of NW Natural ("Holdco") and NORTHWEST
ENERGY SUB CORP., an Oregon corporation and a wholly-owned subsidiary of Holdco
("Merger Sub"),
WITNESSETH:
WHEREAS, the Board of Directors of each of NW Natural, Holdco and Merger Sub
deems it advisable to merge Merger Sub with and into NW Natural in accordance
with the Oregon Business Corporation Act (the "Oregon Business Corporation Act")
and to approve this Agreement for the purpose of establishing Holdco as the
parent corporation of NW Natural, as a result of which the holders of common
stock, $3 1/6 par value per share, of NW Natural (the "NW Natural Common Stock")
would hold, in lieu thereof, common stock of Holdco (the "Holdco Common Stock");
WHEREAS, the Board of Directors of each of NW Natural, Holdco and
Merger Sub has determined to recommend that their respective shareholders
approve this Agreement, the merger of Merger Sub with and into NW Natural (the
"Merger") and the other matters set forth herein;
NOW, THEREFORE, in consideration of the premises and agreements contained
herein and other good and valuable consideration, the receipt and sufficiency of
which are hereby acknowledged, the parties hereto agree as follows:
ARTICLE 1
THE MERGER
1.1 MERGER. Merger Sub shall be merged with and into NW Natural, with NW
Natural being the corporation surviving the Merger.
1.2 ARTICLES OF MERGER. Subject to and in accordance with the provisions of
this Agreement, Articles of Merger of NW Natural shall be delivered for filing
with the Office of the Secretary of State of Oregon, all as provided by
applicable law.
1.3 EFFECTIVE TIME. The Merger shall become effective at the time of filing
on the date on which the Articles of Merger are filed with the Office of the
Secretary of State of Oregon, as contemplated by Section 1.2 above, unless
otherwise specified in such Articles of Merger (the "Effective Time"). At the
Effective Time, the separate existence of Merger Sub shall cease and Merger Sub
shall be merged with and into NW Natural, which shall continue its corporate
existence as the surviving corporation (NW Natural and Merger Sub being
sometimes referred to herein as the "Constituent Corporations" and NW Natural,
as the surviving corporation, being sometimes referred to herein as the
"Surviving Corporation"). NW Natural shall succeed, without other transfer, to
all the rights and property of Merger Sub, shall be subject to all the debts and
liabilities of Merger Sub in the same manner as if NW Natural had itself
incurred them and all rights of creditors and all liens upon the property of
each of NW Natural and Merger Sub shall be preserved unimpaired, all as provided
in Section 60.497 of the Oregon Business Corporation Act.
1.4 APPROPRIATE ACTIONS. Prior to and after the Effective Time, Holdco, NW
Natural and Merger Sub shall take all such actions as may be necessary or
appropriate in order to effectuate the Merger. In this connection, Holdco shall
issue and deliver the shares of Holdco Common Stock into which outstanding
shares of NW Natural Common Stock will be converted on the basis and to the
extent provided in Article 2 of this Agreement, and shall take such other
actions as are necessary to fulfill Holdco's obligations hereunder, including,
without limitation, those specified in Article 6 of this Agreement. In case at
any time after the Effective Time any further action is necessary or desirable
to carry out the purposes of this Agreement and to vest the Surviving
Corporation with full title to all properties, assets, privileges, rights,
immunities and franchises of either of the Constituent Corporations, NW Natural
and the individuals who were the officers and directors of Merger Sub as of the
Effective Time shall take all such further action.
ARTICLE 2
TERMS OF CONVERSION AND EXCHANGE OF SHARES
2.1 NW NATURAL COMMON STOCK. At the Effective Time, shares of NW Natural
Common Stock issued and outstanding immediately prior to the Effective Time
shall be automatically changed and converted into shares of Holdco Common Stock,
in the ratio of one share of Holdco Common Stock for each one share of NW
Natural Common Stock, and such Holdco Common Stock shall thereupon be issued and
outstanding and shall be fully-paid and non-assessable.
2.2 NW NATURAL PREFERRED STOCK. At the Effective Time, shares of NW Natural
Preferred Stock issued and outstanding immediately prior to the Merger shall
remain unchanged.
2.3 NW NATURAL PREFERENCE STOCK. At the Effective Time, shares of NW Natural
Preference Stock issued and outstanding immediately prior to the Merger shall
remain unchanged.
2.4 MERGER SUB COMMON STOCK. The shares of Merger Sub Common Stock issued
and outstanding immediately prior to the Effective Time shall be automatically
changed and converted into all of the issued and outstanding shares of Common
Stock of the Surviving Corporation, which shall thereupon be issued and
outstanding and fully-paid and non-assessable, with the effect that the number
of issued and outstanding shares of Common Stock of the Surviving Corporation
shall be the same as the number of issued and outstanding shares of Merger Sub
Common Stock immediately prior to the Effective Time.
2.5 HOLDCO COMMON STOCK. Each share of Holdco Common Stock issued and
outstanding immediately prior to the Effective Time shall be canceled.
2.6 COMMON STOCK PURCHASE RIGHTS. At the Effective Time, the common share
purchase rights issued pursuant to the Rights Agreement dated as of February 27,
1996, as amended to date (the "Rights Agreement"), between NW Natural and
ChaseMellon Shareholder Services, as Rights Agent (the "Rights Agent"), shall be
deemed to represent for all purposes rights to purchase shares of Holdco Common
Stock on the terms set forth in the Rights Agreement, and Holdco, NW Natural and
the Rights Agent shall execute and deliver an amendment to the Rights Agreement
to effectuate the assumption by Holdco of the obligations of the Company under
the Rights Agreement, so that, for purposes of the Rights Agreement, the term
"Company" shall be deemed to refer to Holdco. Holdco shall take such other
corporate action (including, without limitation, the declaration of a dividend
on its common stock) that is required in order for Holdco to assume the
obligations of the Company under the Rights Agreement pursuant to this Section
2.6.
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ARTICLE 3
ARTICLES OF INCORPORATION AND BYLAWS
3.1 NW NATURAL ARTICLES AND BYLAWS. Promptly after the Effective Time and
until thereafter amended in accordance with applicable law, the Articles of
Incorporation of NW Natural shall be amended and restated as provided in Exhibit
A, attached hereto, and the Board of Directors of NW Natural shall take such
further steps as necessary to amend and restate the Bylaws of NW Natural,
pursuant to the Oregon Business Corporation Act, as provided in Exhibit B,
attached hereto.
3.2 HOLDCO ARTICLES AND BYLAWS. Immediately prior to the Effective Time and
until thereafter amended in accordance with applicable law, the Board of
Directors of Holdco shall take such further steps as necessary to amend and
restate the Articles of Incorporation and Bylaws of Holdco, pursuant to the
Oregon Business Corporation Act, as provided in Exhibits C and D, respectively,
attached hereto.
ARTICLE 4
DIRECTORS AND OFFICERS
4.1 NW NATURAL DIRECTORS AND OFFICERS. The persons who are officers of NW
Natural immediately prior to the Effective Time shall continue as officers of NW
Natural and shall continue to hold office as provided in the Articles of
Incorporation and Bylaws of NW Natural. The persons listed on Exhibit E hereto
shall, as of the Effective Time, become directors of NW Natural and shall hold
office as provided in the Articles of Incorporation and Bylaws of NW Natural.
4.2 HOLDCO DIRECTORS AND OFFICERS. NW Natural, as sole shareholder of Holdco
prior to the Effective Time, shall take such steps as necessary to cause,
pursuant to the Oregon Business Corporation Act, the persons who are directors
of NW Natural prior to the Effective Time to become, immediately prior to the
Effective Time, directors of Holdco and shall hold office as provided in the
Articles of Incorporation and Bylaws of Holdco, as amended and restated pursuant
to Section 3.2 above. The directors shall be divided into three classes as
follows:
(a) persons whose terms as directors of NW Natural would have expired
at the first annual meeting of shareholders following the
Effective Time shall be Class I directors;
(b) persons whose terms as directors of NW Natural would have expired
at the second annual meeting of shareholders following the
Effective Time shall be Class II directors; and
(c) persons whose terms as directors of NW Natural would have expired
at the third annual meeting of shareholders following the
Effective Time shall be Class III directors.
The persons who are officers of Holdco immediately prior to the Merger shall
continue as officers of Holdco and shall hold office as provided in the Bylaws
of Holdco.
ARTICLE 5
STOCK CERTIFICATES
5.1 RIGHTS OF HOLDERS OF CERTIFICATES. Following the Effective Time,
certificates representing shares of NW Natural Common Stock outstanding at the
Effective Time (herein sometimes referred to as "NW Natural Certificates") shall
represent the same number of shares of Holdco Common
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Stock and shall evidence the right of the registered holder thereof to receive,
and may be exchanged for, certificates for the shares of Holdco Common Stock
into which such shares of NW Natural Common Stock were converted in accordance
with Section 2.1. At the Effective Time, Holdco shall issue and deliver, or
cause to be issued and delivered, to the transfer agent for Holdco Common Stock
(the "Transfer Agent") certificates representing whole shares of Holdco Common
Stock into which outstanding shares of NW Natural Common Stock have been
converted as provided above. As promptly as practicable following the Effective
Time, Holdco shall send or cause to be sent to each former shareholder of record
of NW Natural immediately prior to the Effective Time written instructions and
transmittal materials (a "Transmittal Letter") for use in surrendering NW
Natural Certificates to the Transfer Agent. Upon the proper surrender and
delivery to the Transfer Agent (in accordance with Holdco's instructions, and
accompanied by a properly completed Transmittal Letter) by a former shareholder
of NW Natural of such shareholder's NW Natural Certificate(s), and in exchange
therefor, the Transfer Agent shall, as soon as practicable, issue, register and
deliver to such shareholder a certificate evidencing the shares of Holdco Common
Stock as contemplated in Section 2.1 above.
5.2 OUTSTANDING CERTIFICATES. Each outstanding certificate which, prior to
the Effective Time, represented NW Natural Common Stock shall be deemed for all
corporate purposes to represent the same number of shares of Holdco Common Stock
and the right to receive certificates therefor.
5.3 STOCK TRANSFER BOOKS. The stock transfer books for NW Natural Common
Stock shall be deemed to be closed at the Effective Time and no transfer of
shares of NW Natural Common Stock outstanding prior to the Effective Time shall
thereafter be made on such books. As of the Effective Time, Holdco shall
establish a stock register reflecting ownership of Holdco Common Stock by former
holders of record of NW Natural Common Stock.
5.4 POST-MERGER RIGHTS OF HOLDERS. Following the Effective Time, the holders
of certificates for NW Natural Common Stock outstanding immediately prior to the
Effective Time shall cease to have any rights with respect to the stock of NW
Natural and their sole rights shall be with respect to the Holdco Common Stock
into which their shares of NW Natural Common Stock shall have been converted by
the Merger.
5.5 UNSURRENDERED CERTIFICATES. Subject to Section 5.6 below, no Holdco
Common Stock certificate shall be delivered to any former holder of NW Natural
Common Stock unless and until such shareholder shall have properly surrendered
to the Transfer Agent the NW Natural Certificate(s) formerly representing his or
her shares of NW Natural Common Stock, together with a properly completed
Transmittal Letter in such form as shall be provided to the shareholder by
Holdco for that purpose. Further, until such NW Natural Certificate(s) are so
surrendered, no dividend or other distribution payable to holders of record of
Holdco Common Stock as of any date subsequent to the Effective Time shall be
delivered to the holder of such NW Natural Certificate(s). However, subject to
prior escheatment under applicable law, upon the proper surrender of such NW
Natural Certificate(s), the Transfer Agent shall pay to the registered holder of
the shares of Holdco Stock represented by such NW Natural Certificate(s) the
amount without interest of any such cash, dividends or distributions which have
accrued but remain unpaid with respect to such shares. Neither Holdco, NW
Natural nor the Transfer Agent shall have any obligation to pay any interest on
any such cash, dividends or distributions for any period prior to such payment.
5.6 LOST, ETC., CERTIFICATES. Any former holder of NW Natural Common Stock
whose certificate for shares of NW Natural Common Stock has been lost,
destroyed, stolen or otherwise is missing shall be entitled to receive a
certificate representing the shares of Holdco Common Stock to which he or she is
entitled in accordance with and upon compliance with conditions imposed by the
Transfer Agent or Holdco (including, without limitation, a requirement that the
shareholder provide a lost
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instruments indemnity or surety bond in form, in substance and amount
satisfactory to the Transfer Agent and Holdco).
ARTICLE 6
NORTHWEST NATURAL GAS STOCK PLANS
NW Natural and Holdco shall take all actions required to provide that, from
and after the Effective Time, all director, officer, employee, customer,
shareholder and other plans of NW Natural or its affiliates, to the extent they
directly or indirectly utilize NW Natural Common Stock, shall utilize Holdco
Common Stock instead of NW Natural Common Stock.
ARTICLE 7
NORTHWEST NATURAL CONVERTIBLE DEBENTURES
7.1 Pursuant to Sections 6.01 and 11.15 of the Indenture (the "Indenture")
dated January 15, 1987, between NW Natural and The Bank of New York, a New York
corporation, (the "Trustee"), providing for NW Natural's 7 1/4% Convertible
Debentures due March 1, 2012, NW Natural and Holdco shall enter into a
supplemental indenture (the "Supplemental Indenture") immediately prior to the
Effective Time which shall provide that the Holder of a Debenture may convert
such Debenture, as provided for in Article 11 of the Indenture, into the amount
of shares of Holdco Common Stock which such Holder would have owned immediately
after the Merger if such Holder had converted the Debenture immediately before
the Effective Time. The Supplemental Indenture shall provide for adjustments
which shall be as nearly equivalent as may be practical to the adjustments
provided for in Article 11 of the Indenture. Holdco shall mail to the
Debentureholders a notice briefly describing the Supplemental Indenture.
7.2 Pursuant to Section 11.15 of the Indenture, NW Natural shall deliver to
the Trustee an Officers' Certificate and Opinion of Counsel, each stating that
the Merger and Supplemental Indenture comply with Article 6 and Section 11.15 of
the Indenture.
7.3 With respect to this Article 7, capitalized terms not defined in this
Agreement shall have the meaning ascribed to them in the Indenture.
ARTICLE 8
CONDITIONS OF THE MERGER
Completion of the Merger is subject to the satisfaction of the following
conditions:
8.1 SHAREHOLDER APPROVAL. The principal terms of this Agreement shall have
been approved by such holders of capital stock of the parties hereto as is
required by the Oregon Business Corporation Act.
8.2 STOCK EXCHANGE LISTING. All conditions for the listing on the New York
Stock Exchange as of the Effective Time of the Holdco Common Stock to be issued
and to be reserved for issuance pursuant to the Merger shall have been
satisfied.
8.3 REGULATORY APPROVALS. All necessary orders, consents, authorizations,
approvals or waivers from the Secretary of State of Oregon and all other
regulatory bodies, boards or agencies, or from other third parties, shall have
been received, remain in full force and effect, and shall not include, in the
sole judgment of the Board of Directors of NW Natural, unacceptable conditions.
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8.4 FILINGS. All documents that are required to be filed pursuant to the
Oregon Business Corporation Act shall have been duly executed and filed with the
appropriate agency.
8.5 TAX OPINION. NW Natural shall have received an opinion of Thelen Reid &
Priest LLP confirming the United States federal income tax consequences of the
Merger and reorganization contemplated by this Agreement.
ARTICLE 9
AMENDMENT AND TERMINATION
9.1 AMENDMENT. The parties to this Agreement, by consent of their respective
boards of directors, may amend, modify or supplement this Agreement in such
manner as may be agreed upon by them in writing at any time before or after
approval of this Agreement by the pre-Merger shareholders of NW Natural (as
provided in Section 8.1 above); provided, however, that no such amendment,
modification or supplement shall, if agreed to after such approval by the
pre-Merger shareholders of NW Natural, change any of the principal terms of this
Agreement in a manner that would materially and adversely affect the rights of
the shareholders of NW Natural.
9.2 TERMINATION. This Agreement may be terminated and the transactions
provided for by this Agreement may be abandoned at any time, whether before or
after approval of this Agreement by the pre-Merger shareholders of NW Natural,
by action of the Board of Directors of NW Natural if such Board of Directors
determines for any reason that the completion of the transactions provided for
herein would for any reason be inadvisable or not in the best interests of NW
Natural or its shareholders.
ARTICLE 10
MISCELLANEOUS
10.1 COUNTERPARTS. This Agreement may be executed in multiple counterparts,
each of which shall be deemed an original hereof.
10.2 OREGON LAW. This Agreement shall be governed by and interpreted in
accordance with the laws of the State of Oregon, without giving effect to the
conflict of laws principles thereof.
IN WITNESS WHEREOF, NW Natural, Holdco and Merger Sub have each caused this
Agreement to be executed by an authorized officer.
NORTHWEST NATURAL GAS COMPANY
By:__________________________
Its:_________________________
NORTHWEST ENERGY CORPORATION
By:__________________________
Its:_________________________
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NORTHWEST ENERGY SUB CORP.
By:__________________________
Its:_________________________
EXHIBIT A
---------
AMENDED AND RESTATED ARTICLES OF INCORPORATION
of
NORTHWEST NATURAL GAS COMPANY
as Filed and Effective __________, 200_
STATE OF OREGON
CORPORATION DIVISION
Registry Number:
014302-14
AMENDED AND RESTATED ARTICLES OF INCORPORATION
Business Corporation
1. The name of the corporation is Northwest Natural Gas Company.
2. A copy of the Amended and Restated Articles of Incorporation is
attached.
3. The Amended and Restated Articles of Incorporation do not contain
amendments which require shareholder approval. These Amended and
Restated Articles were duly adopted by the Board of Directors.
Execution: _____________ _____________ _________________
Signature Printed Name Title
Person to contact
about this filing: C. J. Rue (503) 220-2411
Name Daytime Phone
AMENDED AND RESTATED ARTICLES OF INCORPORATION
OF
NORTHWEST NATURAL GAS COMPANY
(These Amended and Restated Articles of Incorporation of Northwest Natural Gas
Company supersede its theretofore existing Restated Articles of Incorporation
and all amendments thereto.)
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ARTICLE I
A. The name of this corporation is NORTHWEST NATURAL GAS COMPANY, and its
duration shall be perpetual.
ARTICLE II
A. The purposes of the corporation are to engage in any lawful activity for
which corporations may be organized under the Oregon Business Corporation Act.
ARTICLE III
A. The aggregate number of shares of capital stock which the corporation
shall have authority to issue is 63,500,000 shares, divided into 1,500,000
shares of Preferred Stock without par value, issuable in series as hereinafter
provided, 2,000,000 shares of Preference Stock without par value, issuable in
series as hereinafter provided, and 60,000,000 shares of Common Stock without
par value.
B. A statement of the preferences, limitations and relative rights of each
class of capital stock of the corporation, namely, the Preferred Stock, the
Preference Stock and the Common Stock, of the variations in the relative rights
and preferences as between series of the Preferred Stock and as between series
of the Preference Stock, insofar as the same are fixed by these Amended and
Restated Articles of Incorporation, and of the authority vested in the board of
directors of the corporation to establish series of Preferred Stock and series
of Preference Stock and to fix and determine the variations in the relative
rights and preferences as between series insofar as the same are not fixed by
these Amended and Restated Articles of Incorporation, is as follows:
Preferred Stock
1. The shares of the Preferred Stock may be divided into and issued in
series. Each series shall be so designated as to distinguish the shares thereof
from the shares of all other series of the Preferred Stock and all other classes
of capital stock of the corporation. To the extent that these Amended and
Restated Articles of Incorporation shall not have established series of the
Preferred Stock and fixed and determined the variations in the relative rights
and preferences as between series, the board of directors shall have authority,
and is hereby expressly vested with authority, to divide the Preferred Stock
into series and, within the limitations set forth in these Amended and Restated
Articles of Incorporation and such limitations as may be provided by law, to fix
and determine the relative rights and preferences of any series of the Preferred
Stock so established. Such action by the board of directors shall be expressed
in a resolution or resolutions adopted by it prior to the issuance of shares of
each series, which resolution or resolutions shall also set forth the
distinguishing designation of the particular series of the Preferred Stock
established thereby. Without limiting the generality of the foregoing,
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authority is hereby expressly vested in the board of directors so to fix and
determine with respect to any series of the Preferred Stock:
(a) The rate of dividend;
(b) The price at which and the terms and conditions on which
shares may be redeemed;
(c) The amount payable upon shares in the event of voluntary
and involuntary liquidation;
(d) Sinking fund provisions, if any, for the redemption or
purchase of shares; and
(e) The terms and conditions, if any, on which shares may be
converted if the shares of any series are issued with the privilege of
conversion.
All shares of the Preferred Stock of the same series shall be identical
except that shares of the same series issued at different times may vary as to
the dates from which dividends thereon shall be cumulative; and all shares of
the Preferred Stock, irrespective of series, shall constitute one and the same
class of stock, shall be of equal rank, and shall be identical except as to the
designation thereof, the date or dates from which dividends on shares thereof
shall be cumulative, and the relative rights and preferences set forth above in
clauses (a) through (e) of this subdivision, as to which there may be variations
between different series. Except as otherwise may be provided by law, by
subdivision III.B.7., or by the resolutions establishing any series of Preferred
Stock in accordance with the foregoing provisions of this subdivision, whenever
the written consent, affirmative vote, or other action on the part of the
holders of the Preferred Stock may be required for any purpose, such consent,
vote or other action shall be taken by the holders of the Preferred Stock as a
single class irrespective of series and not by different series.
2. The holders of shares of the Preferred Stock of each series
shall be entitled to receive dividends, when and as declared by the board of
directors, out of any funds legally available for the payment of dividends, at
the annual rate fixed and determined with respect to each series either by these
Amended and Restated Articles of Incorporation or in accordance with subdivision
III.B.1., and no more, payable quarterly on the 15th day of February, May,
August and November in each year or on such other date or dates as the board of
directors shall determine in the resolutions establishing such series. Such
dividends shall be cumulative in the case of shares of each series either from
the date of issuance of shares of such series or from the first day of the
current dividend period within which shares of such series shall be issued, as
the board of directors shall determine, so that if dividends on all outstanding
shares of each particular series of the Preferred Stock, at the annual dividend
rates fixed and determined by the board of directors for the respective series,
shall not have been paid or declared and set apart for payment for all past
dividend periods and for the then current dividend periods, the deficiency shall
be fully paid or dividends equal thereto declared and set apart for payment at
said rates before any dividends on the Preference Stock or the Common Stock
shall be paid or declared and set apart for payment. In the event more than one
series of the Preferred Stock shall be
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outstanding, the corporation, in making any dividend payment on the Preferred
Stock, shall make payments ratably upon all outstanding shares of the Preferred
Stock in proportion to the amount of dividends accumulated thereon to the date
of such dividend payment. No interest, or sum of money in lieu of interest,
shall be payable in respect of any dividend payment or payments which may be in
arrears.
3. In the event of any dissolution, liquidation or winding up of
the corporation, before any distribution or payment shall be made to the holders
of the Preference Stock or the Common Stock, the holders of the Preferred Stock
of each series then outstanding shall be entitled to be paid out of the net
assets of the corporation available for distribution to its shareholders the
respective amounts per share fixed and determined with respect to each series
either by these Amended and Restated Articles of Incorporation or in accordance
with subdivision III.B.1., and no more. If upon dissolution, liquidation or
winding up of the corporation, whether voluntary or involuntary, the net assets
of the corporation available for distribution to its shareholders shall be
insufficient to pay the holders of all outstanding shares of Preferred Stock of
all series the full amounts to which they shall be respectively entitled as
aforesaid, the entire net assets of the corporation available for distribution
shall be distributed ratably to the holders of all outstanding shares of
Preferred Stock of all series in proportion to the amounts to which they shall
be respectively so entitled. For the purposes of this subdivision, any dissolu-
tion, liquidation or winding up which may arise out of or result from the con-
demnation or purchase of all or a major portion of the properties of the
corporation by (i) the United States Government or any authority, agency or
instrumentality thereof, (ii) a State of the United States or any political sub-
division, authority, agency or instrumentality thereof, or (iii) a district,
cooperative or other association or entity not organized for profit, shall be
deemed to be an involuntary dissolution, liquidation or winding up; and a
consolidation, merger or amalgamation of the corporation with or into any other
corporation or corporations shall not be deemed to be a dissolution, liquidation
or winding up of the corporation, whether voluntary or involuntary.
4. (a) Subject to the limitations set forth in subdivision
III.B.9. or fixed and determined in accordance with subdivision III.B.1., the
Preferred Stock of all series, or of any series thereof, or any part of any
series thereof, at any time outstanding, may be redeemed by the corporation, at
its election expressed by resolution of the board of directors, at any time or
from time to time, at the then applicable redemption price fixed and determined
with respect to each series either by these Amended and Restated Articles of
Incorporation or in accordance with subdivision III.B.1. If less than all of the
shares of any series are to be redeemed, the redemption shall be made either pro
rata or by lot in such manner as the board of directors shall determine.
(b) In the event the corporation shall so elect to redeem
shares of the Preferred Stock, notice of the intention of the corporation to do
so and of the date and place fixed for redemption shall be mailed not less than
thirty days before the date fixed for redemption to each holder of shares of the
Preferred Stock to be redeemed at his address as it shall appear on the books of
the corporation, and on and after the date fixed for redemption and specified in
such notice (unless the corporation shall default in making payment of the
redemption price), such holders shall cease to be shareholders of the
corporation with respect to such shares and shall have no interest in or claim
against the corporation with respect to such shares, excepting only the right to
receive the redemption price therefor from the corporation on the date fixed for
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redemption, without interest, upon endorsement, if required, and surrender of
their certificates for such shares.
(c) Contemporaneously with the mailing of notice of redemp-
tion of any shares of the Preferred Stock as aforesaid or at any time thereafter
on or before the date fixed for redemption, the corporation may, if it so
elects, deposit the aggregate redemption price of the shares to be redeemed with
any bank or trust company doing business in The City of New York, New York, or
Portland, Oregon, having a capital and surplus of at least $25,000,000, named in
such notice, payable on the date fixed for redemption in the proper amounts to
the respective holders of the shares to be redeemed, upon endorsement, if
required, and surrender of their certificates for such shares, and on and after
the making of such deposit such holders shall cease to be shareholders of the
corporation with respect to such shares and shall have no interest in or claim
against the corporation with respect to such shares, excepting only the right to
exercise such redemption, conversion or exchange rights, if any, on or before
the date fixed for redemption as may have been provided with respect to such
shares or the right to receive the redemption price of their shares from such
bank or trust company on the date fixed for redemption, without interest, upon
endorsement, if required, and surrender of their certificates for such shares.
(d) If the corporation shall have elected to deposit the
redemption moneys with a bank or trust company as permitted by subdivision (c)
above, any moneys so deposited which shall remain unclaimed at the end of six
years after the redemption date shall be repaid to the corporation, and upon
such repayment holders of Preferred Stock who shall not have made claim against
such moneys prior to such repayment shall be deemed to be unsecured creditors of
the corporation for an amount, without interest, equal to the amount they would
theretofore have been entitled to receive from such bank or trust company. Any
redemption moneys so deposited which shall not be required for such redemption
because of the exercise, after the date of such deposit, of any right of
redemption, conversion or exchange or otherwise, shall be returned to the
corporation forthwith. The corporation shall be entitled to receive any interest
allowed by any bank or trust company on any moneys deposited with such bank or
trust company as herein provided, and the holders of any shares called for
redemption shall have no claim against any such interest.
(e) Nothing herein contained shall limit any legal right of
the corporation to purchase or otherwise acquire any shares of the Preferred
Stock.
5. The holders of shares of the Preferred Stock shall have no right
to vote in the election of directors or for any other purpose, except as may be
otherwise provided by law or by subdivisions III.B.6, 7 and 8. Holders of
Preferred Stock shall be entitled to notice of each meeting of shareholders at
which they shall have any right to vote, but shall not be entitled to notice of
any other meeting of shareholders.
6. (a) If at any time dividends payable on any share or shares of
Preferred Stock shall be in arrears in an amount equal to four full quarterly
dividends or more per share, a default in preferred dividends for the purpose of
this subdivision shall be deemed to have occurred, and having so occurred, such
default shall be deemed to exist thereafter until, but only until, all unpaid
accumulated dividends on all shares of Preferred Stock shall have been paid to
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the last preceding dividend period. If and whenever a default in preferred
dividends shall occur, a special meeting of shareholders of the corporation
shall be held for the purpose of electing directors upon the written request of
the holders of at least 10% of the total number of shares of Preferred Stock
then outstanding. Such meeting shall be called by the secretary of the
corporation upon such written request and shall be held at the earliest
practicable date upon like notice as that required for the annual meeting of
shareholders of the corporation and at the place for the holding of such annual
meeting. If notice of such special meeting shall not be mailed by the secretary
within thirty days after personal service of such written request upon the
secretary of the corporation or within thirty days of mailing the same in the
United States of America by registered mail addressed to the secretary at the
principal office of the corporation, then the holders of at least 10% of the
total number of shares of Preferred Stock then outstanding may designate in
writing one of their number to call such meeting and the person so designated
may call such meeting upon like notice as that required for the annual meeting
of shareholders and to be held at the place for the holding of such annual
meeting. Any holder of Preferred Stock so designated shall have access to the
stock books of the corporation for the purpose of causing a meeting of
shareholders to be called pursuant to the foregoing provisions of this
subdivision.
(b) At any such special meeting, or at the next annual meet-
ing of shareholders of the corporation for the election of directors and at each
other meeting, annual or special, for the election of directors held thereafter
(unless at the time of any such meeting such default in preferred dividends
shall no longer exist), the holders of the outstanding shares of Preferred
Stock, voting separately as a class irrespective of series, shall have the right
to elect the smallest number of directors which shall constitute at least
one-fourth of the total number of directors of the corporation, or two
directors, whichever shall be the greater, and the holders of the outstanding
shares of Common Stock, voting as a class, shall have the right to elect all
other members of the board of directors, anything herein or in the bylaws of the
corporation to the contrary notwithstanding. The terms of office, as directors,
of all persons who may be directors of the corporation at any time when such
special right to elect directors shall become vested in the holders of the
Preferred Stock shall terminate upon the election of any new directors to
succeed them as aforesaid.
(c) At any meeting, annual or special, of the corporation,
at which the holders of Preferred Stock shall have the special right to elect
directors as aforesaid, the presence in person or by proxy of the holders of a
majority of the total number of shares of Preferred Stock then outstanding shall
be required to constitute a quorum of such class for the election of directors,
and the presence in person or by proxy of the holders of a majority of the total
number of shares of Common Stock then outstanding shall be required to
constitute a quorum of such class for the election of directors; provided,
however, that the absence of a quorum of the holders of shares of any such class
shall not prevent the election at any such meeting or adjournment thereof of
directors by the other class, if the necessary quorum of the holders of such
other class shall be present at such meeting or any adjournment thereof; and
provided further, that in the absence of a quorum of holders of shares of any
class, a majority of the holders of the shares of such class who are present in
person or by proxy shall have power to adjourn the election of the directors to
be elected by such class from time to time, without notice other than
announcement at the meeting, until the requisite quorum of holders of such class
shall be present in person or by proxy, but no such adjournment shall be made to
a date beyond the date for the mailing of
7
the notice of the next annual meeting of shareholders of the corporation or
special meeting in lieu thereof.
(d) So long as a default in preferred dividends shall exist,
any vacancy in the office of a director elected by the holders of the Preferred
Stock may be filled at any meeting of shareholders, annual or special, for the
election of directors held thereafter, and a special meeting of shareholders, or
of the holders of shares of the Preferred Stock, may be called for the purpose
of filling any such vacancy. So long as a default in preferred dividends shall
exist, any vacancy in the office of a director elected by the holders of the
Common Stock may be filled by a majority vote of the remaining directors elected
by the holders of Common Stock.
(e) If and when the default in preferred dividends which
permitted the election of directors by the holders of the Preferred Stock shall
cease to exist, the holders of the Preferred Stock shall be divested of any
special right with respect to the election of directors, and the voting power of
the holders of the Preferred Stock and of the holders of the Common Stock shall
revert to the status existing before the first dividend payment date on which
dividends on the Preferred Stock were not paid in full, subject to revesting in
the event of each and every subsequent like default in preferred dividends. Upon
the termination of any such special right, the terms of office of all persons
who may have been elected directors by vote of the holders of the Preferred
Stock pursuant to such special right shall forthwith terminate, and the
resulting vacancies shall be filled by the majority vote of the remaining
directors.
7. So long as any shares of the Preferred Stock shall be outstand-
ing, the corporation shall not, without the written consent or affirmative vote
of the holders of at least two-thirds of the total number of shares of the
Preferred Stock then outstanding, (i) create or authorize any new class of stock
ranking prior to the Preferred Stock as to dividends or upon dissolution,
liquidation or winding up, or (ii) amend, alter or repeal any of the express
terms of the Preferred Stock then outstanding in a manner substantially
prejudicial to the holders thereof. Notwithstanding the foregoing provisions of
this subdivision, if any proposed amendment, alteration or repeal of any of the
express terms of any outstanding shares of the Preferred Stock would be
substantially prejudicial to the holders of shares of one or more, but not all,
of the series of the Preferred Stock, only the written consent or affirmative
vote of the holders of at least two-thirds of the total number of outstanding
shares of all series so affected shall be required. Any affirmative vote of the
holders of the Preferred Stock, or of any one or more series thereof, which may
be required in accordance with the foregoing provisions of this subdivision,
upon a proposal to create or authorize any class of stock ranking prior to the
Preferred Stock or to amend, alter or repeal the express terms of outstanding
shares of the Preferred Stock or of any one or more series thereof in a manner
substantially prejudicial to the holders thereof may be taken at a special
meeting of the holders of the Preferred Stock or of the holders of one or more
series thereof called for the purpose, notice of the time, place and purposes of
which shall have been given to the holders of the shares of the Preferred Stock
entitled to vote upon any such proposal, or at any meeting, annual or special,
of the shareholders of the corporation, notice of the time, place and purposes
of which shall have been given to holders of shares of the Preferred Stock
entitled to vote on such a proposal.
8
8. So long as any shares of the Preferred Stock shall be outstand-
ing, the corporation shall not, without the written consent or affirmative vote
of the holders of at least a majority of the total number of shares of Preferred
Stock then outstanding:
(a) issue any shares of the Preferred Stock, or of any other
class of stock ranking prior to or on a parity with the Preferred Stock as to
dividends or upon dissolution, liquidation or winding up, unless (i) the net
income of the corporation available for the payment of dividends for a period of
twelve consecutive calendar months within the fifteen calendar months
immediately preceding the issuance of such shares (including, in any case in
which such shares are to be issued in connection with the acquisition of new
property, the net income of the property so to be acquired, computed on the same
basis as the net income of the corporation) is at least equal to two times the
annual dividend requirements on all shares of the Preferred Stock, and on all
shares of all other classes of stock ranking prior to or on a parity with the
Preferred Stock as to dividends or upon dissolution, liquidation or winding up,
which will be outstanding immediately after the issuance of such shares,
including the shares proposed to be issued, and (ii) the gross income of the
corporation available for the payment of interest for a period of twelve
consecutive calendar months within the fifteen calendar months immediately
preceding the issuance of such shares (including, in any case in which such
shares are to be issued in connection with the acquisition of new property, the
gross income of the property so to be acquired, computed on the same basis as
the gross income of the corporation) is at least equal to one and one-half times
the aggregate of the annual interest requirements on all securities evidencing
indebtedness of the corporation, and the annual dividend requirements on all
shares of the Preferred Stock and on all shares of all other classes of stock
ranking prior to or on a parity with the Preferred Stock as to dividends or upon
dissolution, liquidation or winding up, which will be outstanding immediately
after the issuance of such shares, including the shares proposed to be issued;
or
(b) issue any shares of the Preferred Stock, or of any other
class of stock ranking prior to or on a parity with the Preferred Stock as to
dividends or upon dissolution, liquidation or winding up, unless the aggregate
of the capital of the corporation applicable to the Common Stock and the surplus
of the corporation (paid-in, earned or other, if any) shall be not less than the
aggregate amount payable on the involuntary dissolution, liquidation or winding
up of the corporation on all shares of the Preferred Stock, and on all shares of
all other classes of stock ranking prior to or on a parity with the Preferred
Stock as to dividends or upon dissolution, liquidation or winding up, which will
be outstanding immediately after the issuance of such shares, including the
shares proposed to be issued; provided, however, that if, for the purposes of
meeting the requirements of this subdivision, it shall become necessary to take
into consideration any surplus of the corporation the corporation shall not
thereafter pay any dividends on shares of the Preference Stock or the Common
Stock which would result in reducing the aggregate of the capital of the
corporation applicable to the Common Stock and the surplus of the corporation to
an amount less than the aggregate amount payable, on involuntary dissolution,
liquidation or winding up of the corporation, on all shares of the Preferred
Stock and of any stock ranking prior to or on a parity with the Preferred Stock,
as to dividends or upon dissolution, liquidation or winding up, at the time
outstanding.
In any case where it would be appropriate, under generally accepted
accounting principles, to combine or consolidate the financial statements of any
predecessor or subsidiary of
9
the corporation with those of the corporation, the foregoing computations may be
made on the basis of such combined or consolidated financial statements. Any
affirmative vote of the holders of the Preferred Stock, which may be required in
accordance with the foregoing provisions of this subdivision, may be taken at a
special meeting of the holders of the Preferred Stock called for the purpose,
notice of the time, place and purposes of which shall have been given to the
holders of the outstanding shares of the Preferred Stock, or at any meeting,
regular or special, of the shareholders of the corporation, notice of the time,
place and purposes of which shall have been given to the holders of the
outstanding shares of the Preferred Stock.
9. The series of Preferred Stock heretofore established and
outstanding on the date of the adoption of these Amended and Restated Articles
of Incorporation, together with a statement of the rights and preferences of
each series, are as follows:
$7.125 Series
(a) The Preferred Stock $7.125 Series, of which 90,000
shares were outstanding at the time of the adoption of these Amended and
Restated Articles of Incorporation, shall have the following rights and
preferences:
(i) (1) the rate of dividend of shares of said Series
shall be $7.125 per annum plus that amount, if any, which will maintain each
holder's after Federal income tax dividend yield on each dividend with respect
to which any legislative enactment, administrative action, judicial decision or
other change in law shall reduce or eliminate the dividends received deduction
of 70% provided by Section 243(a)(1) of the Internal Revenue Code of 1986, as
amended, as in effect on April 1, 1988 (the "Dividends Received Deduction"), at
the level at which such yield would have been if such dividend had been paid to
such holder on April 1, 1988 (each holder's after Federal income tax dividend
yield on April 1, 1988 being calculated on the bases of (i) a cost per share of
$100, (ii) the Dividends Received Deduction, and (iii) an assumed Federal income
tax rate of 34%; and, thereafter, such holder's after Federal income tax
dividend yield being calculated on the bases of (i) and (iii) and any reduced
dividends received deduction at the time then in effect); provided, however,
that any such increased dividend shall be payable only (A) on shares of said
Series in respect of which the holder shall have delivered to the corporation no
later than 360 days after the effective date of any such reduction or
elimination of the Dividends Received Deduction a written notice (I) stating
that such holder is entitled to an increased dividend as a result of such
reduction or elimination, (II) specifying the amount per share of such increase,
and (III) specifying the total number of shares of said Series held by such
holder, and (B) in respect of dividends payable after the date of receipt of
such notice by the corporation; (2) the dividend payment dates shall be the 15th
days of February, May, August and November in each year, commencing on February
15, 1994; and (3) dividends shall be cumulative from December 1, 1993;
(ii) (1) other than as provided in subdivision (2)
below, shares of said Series shall not be redeemable at the election of the
corporation prior to May 1, 1998. On and after May 1, 1998, the shares of said
Series may be redeemed, at the election of the corporation, at the following
redemption prices:
10
If Redeemed If Redeemed
During 12-Months Redemption During 12-Months Redemption
Period Ending Price Period Ending Price
April 30 Per Share April 30 Per Share
-------- --------- -------- ---------
1999.................. $104.750 2004.................. $102.375
2000.................. $104.275 2005.................. $101.900
2001.................. $103.800 2006.................. $101.425
2002.................. $103.325 2007.................. $100.950
2003.................. $102.850 2008.................. $100.475
and thereafter $100 per share, plus an amount in each case equal to accrued
unpaid dividends, if any, to the date of redemption; and (2) all but not less
than all of the shares of said Series held by any holder which shall have given
notice that such holder will be entitled to an increased dividend in accordance
with subdivision (i)(1) above may be redeemed, at the election of the
corporation, at the redemption price of $100 per share, plus an amount equal to
accrued unpaid dividends to the date of redemption, within the period of 360
days commencing on the date of receipt by the corporation of such notice.
(iii) the amount payable upon shares of said Series
in the event of involuntary liquidation shall be $100 per share and in the event
of voluntary liquidation (1) occurring prior to May 1, 1994, shall be $107.125
per share, (2) occurring during the 12 months periods ending April 30, 1995,
1996, 1997 and 1998, shall be, respectively, $106.650, $106.175, $105.700 and
$105.225 per share and (3) occurring on or after May 1, 1998, shall be an amount
equal to the then applicable redemption price of shares of said Series, plus in
each case, an amount equal to accrued unpaid dividends, if any, to the date of
payment;
(iv) shares of said Series shall not be, by their
terms, convertible;
(v) shares of said Series shall be entitled to the
benefits of a sinking fund as follows:
(1) The corporation (unless such action, in the
opinion of counsel for the corporation, would be contrary to any applicable law
or to any rule or regulation of any governmental authority having jurisdiction
in the premises) as a sinking fund for the retirement of shares of said Series,
shall redeem, in the manner herein provided, 7,500 shares of said Series on June
15, 1994 and 7,500 shares of said Series on the 15th day of June of each year
thereafter so long as any shares of said Series shall remain outstanding, at
$100.00 per share plus accrued unpaid dividends to the date fixed for
redemption. The total number of shares to be redeemed and the number of shares
to be redeemed from any holder shall be adjusted to the nearest full share so
that fractional shares need not be redeemed. The corporation may, on any
redemption date as above provided and at its option, credit against its sinking
fund obligation such number of shares of said Series theretofore redeemed by the
corporation, otherwise than for the account of its sinking fund obligation, or
such number of shares of said Series theretofore purchased by the corporation at
a price per share not in excess of $100.00 plus accrued unpaid dividends, and in
either case not theretofore applied as a credit on its sinking fund obligation.
11
The sinking fund for said Series shall not be cumulative. Notice of redemption
for each sinking fund shall be given, and deposit of the aggregate redemption
price may be made, subject to the general terms and provisions for redemption of
the Preferred Stock set forth in subdivision III.B.4 of the Amended and Restated
Articles of Incorporation;
(2) Shares of said Series redeemed pursuant to
the provisions of the sinking fund or credited thereto shall be cancelled, shall
not be reissued as shares of said Series, and shall be restored to the status of
authorized but unissued shares of the Preferred Stock of the corporation;
(3) Unless otherwise provided by law, nothing
herein contained shall prevent or in any manner restrict the Board of Directors
of the corporation from authorizing and issuing any other series of Preferred
Stock entitled to a purchase fund, sinking fund or other analogous device for
the benefit of the holders of such other series of Preferred Stock of the
corporation, whether or not the provisions therefor shall correspond with the
provisions for said Series; provided that the dates on which such other fund or
device shall operate in any particular year shall correspond with the date
applicable to said Series and in the event there is a deficiency in the funds
available in any particular year for the fulfillment of the maximum requirements
of the purchase funds, sinking funds or other analogous devices of all
outstanding series of Preferred Stock of the corporation in accordance with the
terms thereof, such funds as are available in accordance with such terms for
such purpose shall be prorated among all such series so that the percentage
allocated to any particular series of Preferred Stock shall correspond with its
portion of the total amount due; and
(4) After June 15, 1994, so long as any shares
of said Series shall be outstanding, no dividends on the Common Stock or the
Preference Stock of the corporation shall, without the written consent or
affirmative vote of the holders of at least a majority of the total number of
shares of said Series then outstanding, be declared and set apart for payment,
unless the corporation, on the June 15th immediately preceding the declaration
of such dividend, shall have redeemed 7,500 shares of said Series at $100.00 per
share plus accrued unpaid dividends to such June 15th or in accordance with the
terms hereof shall have taken credits against the shares of said Series sinking
fund which, with shares redeemed pursuant to such fund obligation, aggregate
7,500 shares of said Series; and
(vi) Whenever any of the dates mentioned with respect
to said Series shall not be a full business day in the City of Portland, Oregon,
then any action to be taken on said date may be taken on the next succeeding
full business day.
Preference Stock
10. The shares of the Preference Stock may be divided into and
issued in series. Each series shall be so designated as to distinguish the
shares thereof from the shares of all other series of the Preference Stock and
all other classes of capital stock of the corporation. To the extent that these
Amended and Restated Articles of Incorporation shall not have established series
of the Preference Stock and fixed and determined the variations in the relative
rights and preferences as between series, the board of directors shall have
authority, and is hereby expressly vested with authority, to divide the
Preference Stock into series and, within the
12
limitations set forth in these Amended and Restated Articles of Incorporation
and such limitations as may be provided by law, to fix and determine the
relative rights and preferences of any series of the Preference Stock so
established. Such action by the board of directors shall be expressed in a
resolution or resolutions adopted by it prior to the issuance of shares of each
series, which resolution or resolutions shall also set forth the distinguishing
designation of the particular series of the Preference Stock established
thereby. Without limiting the generality of the foregoing, authority is hereby
expressly vested in the board of directors so to fix and determine with respect
to any series of the Preference Stock:
(a) The rate of dividend;
(b) The price at which and the terms and conditions on which
shares may be redeemed;
(c) The amount payable upon shares in the event of voluntary
and involuntary liquidation;
(d) Sinking fund provisions, if any, for the redemption or
purchase of shares;
(e) The terms and conditions, if any, on which shares may be
converted if the shares of any series are issued with the privilege of
conversion; and
(f) Any other relative right or preference as permitted by
law.
All shares of the Preference Stock of the same series shall be
identical except that shares of the same series issued at different times may
vary as to the dates from which dividends thereon shall be cumulative; and all
shares of the Preference Stock, irrespective of series, shall constitute one and
the same class of stock, shall be of equal rank, and shall be identical except
as to the designation thereof, the date or dates from which dividends on shares
thereof shall be cumulative, and the relative rights and preferences set forth
above in clauses (a) through (f) of this subdivision, as to which there may be
variations between different series. Except as otherwise may be provided by law
or by the resolutions establishing any series of Preference Stock in accordance
with the foregoing provisions of this subdivision, whenever the written consent,
affirmative vote, or other action on the part of the holders of the Preference
Stock may be required for any purpose, such consent, vote or other action shall
be taken by the holders of the Preference Stock as a single class irrespective
of series and not by different series.
11. The payment of dividends on the shares of the Preference Stock
shall be subordinate to the dividend and other distributive rights of the
holders of the Preferred Stock. No dividend shall be paid on the Preference
Stock, unless (i) dividends on all outstanding shares of each particular series
of the Preferred Stock, at the annual dividend rates fixed and determined either
by these Amended and Restated Articles of Incorporation or in accordance with
subdivision III.B.1., shall have been paid or declared and set apart for payment
for all past dividend periods and for the then current dividend periods, and
(ii) all amounts due and payable to the holders of the Preferred Stock, by
virtue of purchase funds, sinking funds, or other analogous devices for the
retirement of the Preferred Stock, or by virtue of dissolution, liquidation or
winding up of the corporation, shall have been paid or funds for the payment
13
thereof shall have been set apart for payment. Subject to the foregoing, the
holders of shares of the Preference Stock of each series shall be entitled to
receive dividends, when and as declared by the board of directors, out of any
funds legally available for the payment of dividends, at the annual rate fixed
and determined with respect to each series either by these Amended and Restated
Articles of Incorporation or in accordance with subdivision III.B.10., and no
more, payable quarterly on the 15th day of February, May, August and November in
each year or on such other date or dates as the board of directors shall
determine in the resolutions establishing such series. Such dividends shall be
cumulative in the case of shares of each series either from the date of issuance
of shares of such series or from the first day of the current dividend period
within which shares of such series shall be issued, as the board of directors
shall determine, so that if dividends on all outstanding shares of each
particular series of the Preference Stock, at the annual dividend rates fixed
and determined either by these Amended and Restated Articles of Incorporation or
in accordance with subdivision III.B.10., shall not have been paid or declared
and set apart for payment for all past dividend periods and for the then current
dividend periods, the deficiency shall be fully paid or dividends equal thereto
declared and set apart for payment at said rates before any dividends on the
Common Stock shall be paid or declared and set apart for payment. In the event
more than one series of the Preference Stock shall be outstanding, the
corporation, in making any dividend payment on the Preference Stock, shall make
payments ratably upon all outstanding shares of the Preference Stock in
proportion to the amount of dividends accumulated thereon to the date of such
dividend payment. No interest, or sum of money in lieu of interest, shall be
payable in respect of any dividend payment or payments which may be in arrears.
12. Distribution or payment upon dissolution, liquidation or winding
up of the corporation to the holders of the Preference Stock shall be
subordinate to the dividend and other distributive rights of the holders of the
Preferred Stock. No such distribution or payment shall be made on the Preference
Stock, unless all amounts due by virtue of the dissolution, liquidation or
winding up of the corporation to the holders of all outstanding shares of the
Preferred Stock of all series shall have been paid or funds for the payment
thereof set apart for payment. Subject to the foregoing, in the event of any
dissolution, liquidation or winding up of the corporation, before any
distribution or payment shall be made to the holders of the Common Stock, the
holders of the Preference Stock of each series then outstanding shall be
entitled to be paid out of the net assets of the corporation available for
distribution to its shareholders the respective amounts per share fixed and
determined with respect to each series either by these Amended and Restated
Articles of Incorporation or in accordance with subdivision III.B.10., and no
more. If upon dissolution, liquidation or winding up of the corporation, whether
voluntary or involuntary, the net assets of the corporation available for
distribution to its shareholders (after all amounts due by virtue of the
dissolution, liquidation or winding up of the corporation to the holders of all
outstanding shares of the Preferred Stock of all series shall have been paid or
funds for the payment thereof set apart for payment) shall be insufficient to
pay the holders of all outstanding shares of Preference Stock of all series the
full amounts to which they shall be respectively entitled as aforesaid, the net
assets of the corporation so available for distribution shall be distributed
ratably to the holders of all outstanding shares of Preference Stock of all
series in proportion to the amounts to which they shall be respectively so
entitled. For the purposes of this subdivision, any dissolution, liquidation or
winding up which may arise out of or result from the condemnation or purchase of
all or a major portion of the properties of the corporation by (i) the United
States Government or any authority, agency or instrumentality thereof (ii) a
14
State of the United States or any political subdivision, authority, agency or
instrumentality thereof, or (iii) a district, cooperative or other association
or entity not organized for profit, shall be deemed to be an involuntary
dissolution, liquidation or winding up; and a consolidation, merger or
amalgamation of the corporation with or into any other corporation or
corporations shall not be deemed to be a dissolution, liquidation or winding up
of the corporation, whether voluntary or involuntary.
13. (a) Subject to the limitations set forth in subdivision
III.B.15., or fixed and determined in accordance with subdivision III.B.10.,
the Preference Stock of all series, or of any series thereof, or any part of
any series thereof, at any time outstanding, may be redeemed by the corporation,
at its election expressed by resolution of the board of directors, at any time
or from time to time, at the then applicable redemption price fixed and
determined with respect to each series either by these Amended and Restated
Articles of Incorporation or in accordance with subdivision III.B.10. If less
than all of the shares of any series are to be redeemed, the redemption shall be
made either pro rata or by lot in such manner as the board of directors shall
determine.
(b) In the event the corporation shall so elect to redeem
shares of the Preference Stock, notice of the intention of the corporation to do
so and of the date and place fixed for redemption shall be mailed not less than
thirty days before the date fixed for redemption to each holder of shares of the
Preference Stock to be redeemed at his address as it shall appear on the books
of the corporation, and on and after the date fixed for redemption and specified
in such notice (unless the corporation shall default in making payment of the
redemption price), such holders shall cease to be shareholders of the
corporation with respect to such shares and shall have no interest in or claim
against the corporation with respect to such shares, excepting only the right to
receive the redemption price therefor from the corporation on the date fixed for
redemption, without interest, upon endorsement, if required, and surrender of
their certificates for such shares.
(c) Contemporaneously with the mailing of notice of redemp-
tion of any shares of the Preference Stock as aforesaid or at any time there-
after on or before the date fixed for redemption, the corporation may, if it so
elects, deposit the aggregate redemption price of the shares to be redeemed with
any bank or trust company doing business in The City of New York, New York, or
Portland, Oregon, having a capital and surplus of at least $25,000,000, named in
such notice, payable on the date fixed for redemption in the proper amounts to
the respective holders of the shares to be redeemed, upon endorsement, if
required, and surrender of their certificates for such shares, and on and after
the making of such deposit such holders shall cease to be shareholders of the
corporation with respect to such shares and shall have no interest in or claim
against the corporation with respect to such shares, excepting only the right to
exercise such redemption, conversion or exchange rights, if any, on or before
the date fixed for redemption as may have been provided with respect to such
shares or the right to receive the redemption price of their shares from such
bank or trust company on the date fixed for redemption, without interest, upon
endorsement, if required, and surrender of their certificates for such shares.
(d) If the corporation shall have elected to deposit the
redemption moneys with a bank or trust company as permitted by subdivision (c)
above, any moneys so
15
deposited which shall remain unclaimed at the end of six years after the
redemption date shall be repaid to the corporation, and upon such repayment
holders of Preference Stock who shall not have made claim against such moneys
prior to such repayment shall be deemed to be unsecured creditors of the
corporation for an amount, without interest, equal to the amount they would
theretofore have been entitled to receive from such bank or trust company. Any
redemption moneys so deposited which shall not be required for such redemption
because of the exercise, after the date of such deposit, of any right of
redemption, conversion or exchange or otherwise, shall be returned to the
corporation forthwith. The corporation shall be entitled to receive any interest
allowed by any bank or trust company on any moneys deposited with such bank or
trust company as herein provided, and the holders of any shares called for
redemption shall have no claim against any such interest.
(e) Nothing herein contained shall limit any legal right of
the corporation to purchase or otherwise acquire any shares of the Preference
Stock.
14. The holders of shares of the Preference Stock shall have no
right to vote in the election of directors or for any other purpose, except as
may be otherwise provided by law or by resolutions establishing any series of
Preference Stock in accordance with subdivision III.B.10. Holders of Preference
Stock shall be entitled to notice of each meeting of shareholders at which they
shall have any right to vote, but shall not be entitled to notice of any other
meeting of shareholders.
15. The series of Preference Stock heretofore established and
outstanding on the date of the adoption of these Amended and Restated Articles
of Incorporation, together with a statement of the rights and preferences of
each series, are as follows:
$6.95 Series
(a) The Preference Stock $6.95 Series, of which 250,000
shares were outstanding at the time of the adoption of these Amended and
Restated Articles of Incorporation, shall have the following rights and
preferences:
(i) The rate of dividend of shares of said Series
shall be $6.95 per annum; the dividend payment dates shall be the 15th days of
February, May, August and November in each year, commencing on February 15,
1993; and dividends shall be cumulative from the date of original issue;
(ii) The shares of said Series shall not be redeem-
able prior to December 31, 2002; and on such date, all of the outstanding shares
of said Series shall be subject to mandatory redemption (unless such action, in
the opinion of counsel for the corporation, would be contrary to any applicable
law or to any rule or regulation of any governmental authority having jurisdic-
tion in the premises) at the mandatory redemption price of $100 per share, plus
unpaid accumulated dividends; provided, however, that the payment of such
mandatory redemption price shall be subordinate to the dividend and other
distributive rights of the Preferred Stock, so that such redemption price shall
not be paid and the shares of said Series shall not be redeemed unless (i)
dividends on all outstanding shares of each particular series of the Preferred
Stock, at the annual dividend rates fixed and determined either by these Amended
16
and Restated Articles of Incorporation or in accordance with subdivision III.B.1
thereof, shall have been paid or declared and set apart for payment for all past
dividend periods and for the then current dividend periods, and (ii) all amounts
due and payable to the holders of Preferred Stock, by virtue of purchase funds,
sinking funds, or other analogous devices for the retirement of the Preferred
Stock, or by virtue of dissolution, liquidation or winding up of the
corporation, shall have been paid or funds for the payment thereof shall have
been set apart for payment;
(iii) The amount payable upon shares of said Series in
the event of either involuntary or voluntary liquidation shall be $100 per
share, plus unpaid accumulated dividends, if any, to the date of payment;
(iv) All shares of said Series redeemed by the
corporation shall be cancelled and thereupon restored to the status of
authorized but unissued Preference Stock of the corporation, undesignated as to
series; and
(v) Whenever any of the dates mentioned with respect
to said Series shall not be a full business day in the City of Portland, Oregon,
then any action to be taken on said date may be taken on the next succeeding
full business day.
Common Stock
16. Subject to the limitations set forth in subdivisions III.B.2.
and 11. (and subject to the rights of any class of stock hereafter authorized),
dividends may be paid upon the Common Stock when and as declared by the board of
directors of the corporation out of any funds legally available for the payment
of dividends.
17. Subject to the limitations set forth in subdivisions III.B.3.
and 12. (and subject to the rights of any other class of stock hereafter
authorized), upon any dissolution, liquidation or winding up of the corporation,
whether voluntary or involuntary, the net assets of the corporation shall be
distributed ratably to the holders of the Common Stock.
18. Subject to the limitations set forth in subdivisions III.B.6, 7,
8, 9 and 15. (and subject to the rights of any class of stock hereafter
created), and except as may be otherwise provided by law or by the resolutions
establishing any series of Preference Stock in accordance with subdivision
III.B.10., the holders of the Common Stock shall have the exclusive right to
vote for the election of directors and for all other purposes. In the election
of directors of the corporation, every holder of record of any share or shares
of the Common Stock of the corporation shall have the right to cast as many
votes for in the election as shall equal the number of shares that the holder
owns.
19. Upon the issuance for money or other consideration of any shares
of capital stock of the corporation, or of any security convertible into capital
stock of the corporation, no holder of shares of the capital stock, irrespective
of the class or kind thereof, shall have any preemptive or other right to
subscribe for, purchase or receive any proportionate or other amount of such
shares of capital stock, or such security convertible into capital stock,
proposed to be issued; and the board of directors may cause the corporation to
dispose of all or any of such shares of capital stock, or of any such security
convertible into capital stock, as and when said board may determine, free of
any such right, either by offering the same to the
17
corporation's then shareholders or by otherwise selling or disposing of such
shares or other securities, as the board of directors may deem advisable.
ARTICLE IV
A. The business and affairs of the corporation shall be managed by a board
of directors. Except as provided in subdivision B. below, the number of
members of the board, their terms of office, and the manner of their election
and removal shall be as follows:
1. The number of directors shall be that number, not less than
three or more than six, determined from time to time by resolution adopted by
affirmative vote of a majority of the entire board of directors.
2. A director shall hold office until the annual meeting for the
year in which his or her term shall expire and until his or her successor shall
have been elected and qualified, subject, however, to prior death, resignation,
retirement or removal from office. Any newly created directorship resulting from
an increase in the number of directors and any other vacancy on the board of
directors, however caused, may be filled by the affirmative vote of a majority
of the directors then in office, although less than a quorum, or by a sole
remaining director. The term of a director elected to fill a newly created
directorship or any other vacancy shall expire at the next shareholders' meeting
at which directors are elected.
3. One or more of the directors may be removed with or without
cause by the affirmative vote of the holders of not less than two-thirds of the
shares entitled to vote thereon at a meeting of the shareholders called
expressly for that purpose.
4. No person, except those persons nominated by the board, shall be
eligible for election as a director at any annual or special meeting of
shareholders unless a written request that his or her name be placed in
nomination shall be received from a shareholder of record entitled to vote at
such election by the secretary of the corporation not later than the latter of
(a) the thirtieth day prior to the date fixed for the meeting, or (b) the tenth
day after the mailing of notice of that meeting, together with the written
consent of the nominee to serve as a director.
B. Notwithstanding the provisions of subdivision A. above, whenever the
holders of any one or more classes of the capital stock of the corporation shall
have the right, voting separately as a class or classes, to elect directors at
an annual or special meeting of shareholders, the election, term of office,
filling of vacancies and other features of such directorships shall be governed
by the provisions of these Amended and Restated Articles of Incorporation
applicable thereto. The board of directors shall consist of such directors in
addition to the directors determined as provided in subdivision A. above.
C. This Article IV may not be repealed or amended in any respect unless
such action shall be approved by the affirmative vote of the holders of not less
than two-thirds of the shares entitled to vote at an election of directors
determined as provided in subdivision A. above, at a meeting of the shareholders
called expressly for that purpose.
18
ARTICLE V
No director of the corporation shall be personally liable to the
corporation or its shareholders for monetary damages for conduct as a director;
provided that this Article V shall not eliminate the liability of a director for
any act or omission for which such elimination of liability is not permitted
under the Oregon Business Corporation Act. No amendment to the Oregon Business
Corporation Act that further limits the acts or omissions for which elimination
of liability is permitted shall affect the liability of a director for any act
or omission which occurs prior to the effective date of such amendment.
ARTICLE VI
The corporation shall indemnify to the fullest extent then permitted by
law any person who is made, or threatened to be made, a party to any threatened,
pending or completed action, suit or proceeding, whether civil, criminal,
administrative, investigative or otherwise (including an action, suit or
proceeding by or in the right of the corporation) by reason of the fact that the
person is or was a director or officer of the corporation or is or was serving
at the request of the corporation as a director or officer of another
corporation, partnership, joint venture, trust or other enterprise against all
judgments, amounts paid in settlement, fines and such expenses (including
attorneys' fees), actually and reasonably incurred in connection therewith. This
Article shall not be deemed exclusive of any other provisions for
indemnification of directors and officers that may be included in any statute,
bylaw, agreement, vote of shareholders or directors or otherwise, both as to
action in any official capacity and as to action in another capacity while
holding an office.
19
EXHIBIT B
---------
BYLAWS
OF
NORTHWEST
NATURAL
GAS
COMPANY
AS ADOPTED BY THE BOARD OF DIRECTORS
JULY 17, 1975
AS AMENDED AND RESTATED ON _______________
CONTENTS
ARTICLE I. OFFICES........................................................... 1
Section 1. Office......................................................1
Section 2. Registered Office...........................................1
ARTICLE II. MEETINGS OF SHAREHOLDERS..........................................1
Section 1. Annual Meeting..............................................1
Section 2. Special Meetings............................................1
Section 3. Notice......................................................2
Section 4. Fixing Record Date..........................................2
Section 5. Record of Shareholders......................................2
Section 6. Quorum......................................................3
Section 7. Voting......................................................3
Section 8. Conduct of Meetings.........................................3
ARTICLE III. BOARD OF DIRECTORS...............................................4
Section 1. Directors...................................................4
Section 2. Chairman of the Board.......................................4
Section 3. Lead Director...............................................4
Section 4. Retired Directors...........................................4
Section 5. Compensation................................................5
ARTICLE IV. MEETINGS OF THE BOARD OF DIRECTORS................................5
Section 1. Regular Meetings............................................5
Section 2. Special Meetings............................................5
Section 3. Waiver of Notice............................................5
Section 4. Quorum......................................................6
Section 5. Manner of Acting............................................6
Section 6. Action Without a Meeting....................................6
ARTICLE V. COMMITTEES OF THE BOARD............................................6
Section 1. Executive Committee.........................................6
Section 2. Audit Committee.............................................6
Section 3. Retirement Committee........................................7
Section 4. Pension Committee...........................................7
Section 5. Organization and Executive Compensation Committee...........7
Section 6. Environmental Policy Committee..............................8
Section 7. Finance Committee...........................................8
Section 8. Other Committees............................................8
Section 9. Changes of Size and Function................................8
Section 10. Conduct of Meetings.........................................8
Section 11. Compensation............................................... 9
ARTICLE VI. NOTICES..........................................................10
Section 1. Form and Manner............................................10
Section 2. Waiver.....................................................10
ARTICLE VII. OFFICERS........................................................10
Section 1. Election...................................................10
Section 2. Compensation...............................................10
Section 3. Term.......................................................10
Section 4. Removal....................................................11
Section 5. President..................................................11
Section 6. Vice Presidents............................................11
Section 7. Secretary..................................................11
Section 8. Treasurer..................................................11
ARTICLE VIII. CONTRACTS, LOANS, CHECKS AND DEPOSITS..........................12
Section 1. Contracts..................................................12
Section 2. Loans......................................................12
Section 3. Checks and Drafts..........................................12
Section 4. Deposits...................................................12
ARTICLE IX. CERTIFICATES FOR SHARES AND THEIR TRANSFER.......................12
Section 1. Certificates for Shares....................................12
Section 2. Transfer...................................................13
Section 3. Owner of Record............................................13
ARTICLE X. INDEMNIFICATION AND INSURANCE.....................................13
Section 1. Indemnification............................................13
Section 2. Insurance..................................................14
ARTICLE XI. SEAL.............................................................14
ARTICLE XII. AMENDMENTS......................................................14
The following Bylaws were adopted by Northwest Natural Gas Company on
____________, amending and restating Bylaws adopted on July 17, 1975 pursuant to
an Agreement and Plan of Merger dated ______________, which superseded amended
Bylaws originally adopted in conformity with an order of the District Court of
the United States for the District of Oregon enforcing a plan for rearrangement
of the Company's capital structure effective December 31, 1951, and subsequently
amended by the stockholders on May 17, 1954, May 20, 1957, May 21, 1973, and May
20, 1974.
BYLAWS
OF
NORTHWEST NATURAL GAS COMPANY
ARTICLE I.
OFFICES
SECTION 1. OFFICE. The principal office of the company shall be located in
the City of Portland, Oregon. The company also may have offices at such other
places both within and without the State of Oregon as the board of directors
from time to time may determine.
SECTION 2. REGISTERED OFFICE. The registered office of the company required
by law to be maintained in the state shall be at the same location as the
principal office unless otherwise designated by resolution of the board of
directors.
ARTICLE II.
MEETINGS OF SHAREHOLDERS
SECTION 1. ANNUAL MEETING. The annual meeting of shareholders of the company
for the election of directors and for the transaction of other business shall be
held at the company's office in the City of Portland, Oregon, or such other
place in that City as shall be determined by the board of directors, on the
fourth Thursday of May in each year, unless such day shall be a legal holiday,
in which event such meeting shall be held on the next business day. If such
meeting shall not be held on such day in any year, it shall be held within 60
days thereafter on such day as shall be fixed by the board of directors and be
specified in the notice of the meeting. Every such meeting shall be held at the
hour of two o'clock p.m., or at such other hour as shall be fixed by the board
and specified in such notice.
SECTION 2. SPECIAL MEETINGS. Special meetings of the shareholders of the
company may be called by the board of directors or the holders of not less than
one-tenth of all shares entitled to vote at the meeting. Each special meeting
shall be held for such purposes, at such place in the City of Portland, Oregon,
and at such time as shall be specified in the notice thereof.
SECTION 3. NOTICE. Written or printed notice stating the place, day and hour
of the meeting and, in case of a special meeting, the purpose or purposes for
which the meeting is called, shall be delivered not less than 10 nor more than
50 days before the date of the meeting, either personally or by mail, by or at
the direction of the board of directors or the persons calling the meeting, to
each shareholder of record entitled to vote at such meeting.
SECTION 4. FIXING RECORD DATE. For the purpose of determining shareholders
entitled to notice of or to vote at any meeting of shareholders, or any
adjournment thereof, or entitled to receive payment of any dividend, or in order
to make a determination of shareholders for any other proper purpose, the board
of directors may fix in advance a date as the record date for any such
determination of shareholders, such date in any case to be not more than 50 days
and, in the case of a meeting of shareholders, not less than 10 days prior to
the date on which the particular action requiring such determination of
shareholders is to be taken. If no record date is fixed for the determination of
shareholders entitled to notice of or to vote at a meeting of shareholders, or
shareholders entitled to receive payment of a dividend, the date on which notice
of the meeting is mailed or the date on which the resolution of the board
declaring such dividend is adopted, as the case may be, shall be the record date
for such determination of shareholders. When a determination of shareholders
entitled to vote at any meeting of shareholders has been made as provided in
this section, such determination shall apply to any adjournment thereof.
SECTION 5. RECORD OF SHAREHOLDERS. The officer or agent having charge of the
transfer books for shares of the company shall make, at least 10 days before
each meeting of shareholders, a complete record of the shareholders entitled to
vote at such meeting or any adjournment thereof, arranged in alphabetical order
with the address of and the number of shares held by each, which record, for a
period of 10 days prior to such meeting, shall be kept on file at the registered
office of the company and shall be subject to inspection by any shareholder at
any time during usual business hours. Such record also shall be produced and
kept open at the time and place of the meeting and shall be subject to the
inspection of any shareholder during the whole time of the meeting. The original
transfer books for shares shall be prima facie evidence as to who are the
shareholders entitled to examine such record or transfer books or to vote at any
meeting of the shareholders.
2
SECTION 6. QUORUM. A majority of the shares of the company entitled to vote,
represented in person or by proxy, shall constitute a quorum at all meetings of
shareholders. If a quorum is present, in person or by proxy, the affirmative
vote of a majority of the shares represented at the meeting and entitled to vote
on the subject matter shall be the act of the shareholders, unless the vote of a
greater number, or voting by classes, is required by law or the Amended and
Restated Articles of Incorporation.
If a quorum shall not be represented at any meeting of shareholders, the
shareholders represented may adjourn the meeting from time to time without
further notice. At such adjourned meeting, at which a quorum shall be present or
represented, any business may be transacted which might have been transacted at
the meeting as originally noticed. The shareholders represented at a duly
organized meeting may continue to transact business until adjournment,
notwithstanding the withdrawal of enough shareholders to leave less than a
quorum.
SECTION 7. VOTING. Each outstanding share, regardless of class, shall be
entitled to one vote on each matter submitted to a vote at a meeting of
shareholders, except to the extent that the voting rights of the shares of any
class or classes are limited or denied by law or the Amended and Restated
Articles of Incorporation. A shareholder may vote either in person or by proxy
executed in writing by the shareholder or by his or her duly authorized
attorney-in-fact. Such proxy shall be filed with the secretary of the company
before or at the time of the meeting.
SECTION 8. CONDUCT OF MEETINGS. Every meeting of shareholders shall be
presided over by the chairman of the board, in his or her absence by the
president, in their absence by a vice president or, if none be present, by a
chairman appointed by the shareholders present at the meeting. The minutes of
such meeting shall be recorded by the secretary or an assistant secretary but,
if neither be present, by a secretary appointed for that purpose by the chairman
of the meeting.
3
ARTICLE III.
BOARD OF DIRECTORS
SECTION 1. DIRECTORS. The business and affairs of the company shall be
managed by its board of directors. The number of members of the board, their
classification and terms of office, and the manner of their election and removal
shall be determined as provided by the Amended and Restated Articles of
Incorporation. Directors need not be residents of the State of Oregon or
shareholders of the company. No person who has reached the age of 72 years shall
be eligible to be elected a director, but a director may serve until the next
annual meeting of shareholders after reaching that age.
SECTION 2. CHAIRMAN OF THE BOARD. The board of directors may elect one of
its members as chairman of the board. The chairman of the board, if that
position be filled, shall preside at all meetings of the shareholders and the
board of directors and shall have such other duties and responsibilities as may
be prescribed by the board of directors. If there shall be no chairman of the
board, or in his or her absence or disability, the president also shall exercise
the duties and responsibilities of that position.
SECTION 3. LEAD DIRECTOR. The board of directors shall elect one of its
members as lead director. The lead director shall, in the absence of the
chairman of the board and the president, preside at meetings of the board of
directors and shall preside at all meetings of the executive committee. The lead
director shall have such other duties and responsibilities as may be prescribed
by the board of directors.
SECTION 4. RETIRED DIRECTORS. Any person who, upon retirement as a director
after reaching age 72, shall have served as a director of the company for ten or
more years shall be appointed a retired director of the company for life. Any
other person who shall have served as a director of the company may be elected
by the board as a retired director of the company for one or more terms of one
year or less. A retired director may attend meetings of the board but shall not
have the right to vote at such meetings.
4
SECTION 5. COMPENSATION. Directors shall receive such reasonable
compensation for their services as may be fixed from time to time by resolution
of the board of directors, and shall be reimbursed for their expenses properly
incurred in the performance of their duties as directors. No such payment shall
preclude any director from serving the company in any other capacity and
receiving such reasonable compensation for such services as may be fixed by
resolution of the board.
Retired directors who retired prior to January 1, 1998 shall receive such
compensation as from time to time may be fixed by resolution of the board of
directors as the annual retainer for members of the board of directors.
Directors who retire subsequent to December 31, 1997 shall not be entitled to
receive such compensation.
ARTICLE IV.
MEETINGS OF THE BOARD OF DIRECTORS
SECTION 1. REGULAR MEETINGS. Regular meetings of the board of directors
shall be held in the company's offices at two o'clock p.m., Pacific Time, on the
fourth Thursday of February, April, May, July and September, and on the third
Thursday of December, or on such other date or at such other hour and place as
shall be specified in the notice of meeting. The date, time and place for
holding regular meetings of the board of directors may be changed upon the
giving of notice to all directors by or at the request of the chairman of the
board or the president. The board may provide by resolution the time and place
either within or without the State of Oregon for holding of meetings or may omit
the holding of any meeting without other notice than such resolution. SECTION 2.
SPECIAL MEETINGS. Special meetings of the board of directors may be called by or
at the request of the chairman of the board, the lead director, the president or
any two directors. The person or persons authorized to call special meetings of
the board may fix any place, either within or without the State of Oregon, as
the place for holding any special meeting of the board called by them. Notice of
the time and place of special meetings shall be given to each director at least
one day in advance by the secretary or other officer performing his or her
duties.
SECTION 3. WAIVER OF NOTICE. Any director may waive notice of any meeting.
The attendance of a director at any meeting shall constitute a waiver of notice
of such meeting, except where a director attends a meeting for the express
purpose of objecting to the transaction of any business because the meeting is
not lawfully called or convened. Except as otherwise provided by law or the
Amended and Restated Articles of Incorporation, neither the business to be
transacted at, nor the purpose of, any regular or special meeting of the board
of directors need be specified in the notice or waiver of notice of such
meeting.
5
SECTION 4. QUORUM. A majority of the number of directors at any time fixed
by resolution adopted by the affirmative vote of a majority of the entire board
of directors shall constitute a quorum for the transaction of business. If a
quorum shall not be present at any meeting of directors, the directors present
may adjourn the meeting from time to time without further notice until a quorum
shall be present.
SECTION 5. MANNER OF ACTING. Except as otherwise provided by law or the
Amended and Restated Articles of Incorporation, the act of the majority of the
directors present at a meeting at which a quorum is present shall be the act of
the board of directors. SECTION 6. ACTION WITHOUT A MEETING. Any action required
or permitted to be taken at a meeting of the board of directors may be taken
without a meeting if a consent in writing, setting forth the action so taken,
shall be signed by all of the directors entitled to vote with respect to the
subject matter thereof.
ARTICLE V.
COMMITTEES OF THE BOARD
SECTION 1. EXECUTIVE COMMITTEE. The board of directors at any time, by
resolution adopted by a majority of the board of directors, may appoint an
executive committee composed of the chairman of the board, the lead director,
and such other number of directors as the board may from time to time determine.
The lead director, or in his or her absence, the chairman of the board, shall
act as chairman. The committee shall have and may exercise all of the authority
of the board of directors in the management of the company, except with respect
to matters upon which by law only the board of directors may act. The duties of
the committee shall include recommending to the board nominees for election as
directors, the conduct of periodic reviews of board effectiveness and the
performance of such other functions as the board by resolution from time to time
may direct.
SECTION 2. AUDIT COMMITTEE. The board of directors at any time, by
resolution adopted by a majority of the board of directors, may appoint an audit
committee composed of [three] or more directors, none of whom shall be an
officer of the company. The board shall designate one member of the committee as
chairman. The duties of the committee shall be to discuss and review with the
company's independent auditors the annual audit of the company, including the
scope of the audit, and report the results of this review to the board; to meet
with the independent auditors at such other times as the committee shall deem to
be advisable; and to perform such other functions as the board by resolution
from time to time may direct.
6
SECTION 3. RETIREMENT COMMITTEE. The board of directors at any time, by
resolution adopted by a majority of the board of directors, may appoint a
retirement committee composed of [three] or more directors, a majority of whom
shall not be members under the company's Non-Bargaining Unit Employees
Retirement Plan established by the board. Any action required or permitted to be
taken by the committee must be approved by both (a) a majority of the committee
members present at a meeting at which a quorum is present, and (b) a majority of
the total number of committee members who are not members under said Plan. The
chairman of the committee shall not be a member under said Plan. The duties of
the committee shall be to monitor the general administration of the company's
Non-Bargaining Unit Employees Retirement Plan and the committee shall be
responsible for monitoring the carrying out of its provisions as more fully set
forth under the terms of the Plan.
SECTION 4. PENSION COMMITTEE. The board of directors at any time, by
resolution adopted by a majority of the board of directors, may appoint [three]
or more directors to serve on the pension committee provided for in the
company's Bargaining Unit Employees Retirement Plan established by the board.
The duties of the committee shall be to monitor the general administration of
the Bargaining Unit Employees Retirement Plan and the committee shall be
responsible for monitoring the carrying out of its provisions as more fully set
forth under the terms of the Plan.
SECTION 5. ORGANIZATION AND EXECUTIVE COMPENSATION COMMITTEE. The board of
directors at any time, by resolution adopted by a majority of the board of
directors, may appoint an organization and executive compensation committee
composed of [three] or more directors, none of whom shall be an officer of the
company. The board shall designate one member of the committee as chairman. The
duties of the committee shall be to discuss and review the management of the
affairs of the company relating to its organization and to executive personnel
and their compensation, and to perform such other functions as the board by
resolution from time to time may direct.
7
SECTION 6. ENVIRONMENTAL POLICY COMMITTEE. The board of directors at any
time, by resolution adopted by a majority of the board of directors, may appoint
an environmental policy committee composed of three or more directors, a
majority of whom shall not be officers or retired officers of the company. Any
action required or permitted to be taken by the committee must be approved by
both (a) a majority of the committee members present at a meeting at which a
quorum is present, and (b) a majority of the total number of committee members
who are not officers or retired officers of the company. The board shall
designate one member of the committee who is not an officer or retired officer
of the company as chairman. The duties of the committee shall be to develop and
recommend to the board appropriate environmental policies and to perform such
other functions as the board by resolution from time to time may direct.
SECTION 7. FINANCE COMMITTEE. The board of directors at any time, by
resolution adopted by a majority of the board of directors, may appoint a
finance committee composed of three or more directors, a majority of whom shall
not be officers or retired officers of the company. Any action required or
permitted to be taken by the committee must be approved by both (a) a majority
of the committee members present at a meeting at which a quorum is present, and
(b) a majority of the total number of committee members who are not officers or
retired officers of the company. The board shall designate one member of the
committee who is not an officer or retired officer of the company as chairman.
The duties of the committee shall be to discuss and review the management of the
affairs of the company relating to financing, including the development of
long-range financial planning goals and financial policy, and to perform such
other functions as the board by resolution from time to time may direct.
SECTION 8. OTHER COMMITTEES. The board of directors at any time, by
resolution adopted by a majority of the board of directors, may appoint from
among its members such other committees and the chairmen thereof as it may deem
to be advisable. Each such committee shall have such powers and authority as are
set forth in the resolutions pertaining thereto from time to time adopted by the
board.
SECTION 9. CHANGES OF SIZE AND FUNCTION. Subject to the provisions of law,
the board of directors shall have the power at any time to increase or decrease
the number of members of any committee, to fill vacancies thereon, to change any
members thereof and to change the functions and terminate the existence thereof.
SECTION 10. CONDUCT OF MEETINGS. Each committee shall conduct its meetings
in accordance with the applicable provisions of these bylaws relating to the
conduct of meetings of the board of directors. Each committee shall adopt such
further rules and regulations regarding its conduct, keep such minutes and other
records and appoint such subcommittees and assistants as it shall deem to be
appropriate.
8
SECTION 11. COMPENSATION. Persons serving on any committee shall receive
such reasonable compensation for their services on such committee as may be
fixed by resolution of the board of directors, provided that no person shall
receive compensation for his or her services on any committee while serving as
an officer of the company.
9
ARTICLE VI.
NOTICES
SECTION 1. FORM AND MANNER. Whenever, under the provisions of law or the
Amended and Restated Articles of Incorporation, notice is required to be given
to any director or shareholder, unless otherwise specified, it shall be given in
writing by mail addressed to such director or shareholder at his or her address
as it appears on the stock transfer books or other records of the company, with
postage thereon prepaid, and such notice shall be deemed to be delivered when
deposited in the United States Mail. Notice to directors also shall be given by
telephone or in any other manner which is reasonably calculated to give adequate
notice.
SECTION 2. WAIVER. Whenever any notice whatever is required to be given
under the provisions of law, the Amended and Restated Articles of Incorporation
or these bylaws, a waiver thereof in writing signed by the person or persons
entitled to such notice, whether before or after the time stated therein, shall
be deemed equivalent to the giving of such notice.
ARTICLE VII.
OFFICERS
SECTION 1. ELECTION. The board of directors, at its first meeting following
the annual meeting of shareholders each year, shall elect one of its members as
president and shall elect a secretary. At such meeting, or at any other time it
shall deem appropriate, the board may elect one or more vice presidents and a
treasurer. The board also may elect or appoint such other officers and agents as
it may deem necessary. Any two or more offices may be held by the same person,
except the offices of president and secretary.
SECTION 2. COMPENSATION. The officers of the company shall receive such
reasonable compensation for their services as from time to time may be fixed by
resolution of the board of directors. SECTION 3. TERM. The term of office of all
officers shall commence upon their election or appointment and shall continue
until the first meeting of the board of directors following the annual meeting
of shareholders and thereafter until their successors shall be elected or until
their resignation or removal. A vacancy occurring in any office of the company
for whatever reason may be filled by the board.
10
SECTION 4. REMOVAL. Any officer or agent elected or appointed by the board
of directors may be removed by the board whenever in its judgment the best
interests of the company will be served thereby but such removal shall be
without prejudice to the contract rights, if any, of the officer or agent so
removed.
SECTION 5. PRESIDENT. Unless otherwise determined by the board of directors,
the president shall be the chief executive officer of the company and, subject
to the control of the board of directors, shall be responsible for the general
administration and operation of the company. He shall have such other duties and
responsibilities as may pertain to such office or be prescribed by the board of
directors. In the absence or disability of the president, an officer designated
by the board shall exercise the duties and responsibilities of the president.
SECTION 6. VICE PRESIDENTS. Each vice president shall have such duties and
responsibilities as may be prescribed by the board of directors and the
president. The board or the president may confer a special title upon a vice
president.
SECTION 7. SECRETARY. The secretary shall record and keep the minutes of the
shareholders in one or more books provided for that purpose; see that all
notices are duly given in accordance with the provisions of these bylaws or as
required by law; and perform such other duties as may be prescribed by the board
or the president. The secretary shall have custody of the corporate seal of the
company and shall affix the seal to any instrument requiring it and attest the
same by his or her signature.
The assistant secretaries shall have such duties as may be prescribed from
time to time by the board, the president or the secretary. In the absence or
disability of the secretary, his or her duties shall be performed by an
assistant secretary.
SECTION 8. TREASURER. The treasurer shall have charge and custody and be
responsible for all funds and securities of the company; deposit all moneys and
other valuable effects in the name and to the credit of the company in such
depositories as may be designated by the board of directors; and disburse the
funds of the company as may be authorized by the board and take proper vouchers
for such disbursements. The treasurer shall have such other duties as may be
prescribed from time to time by the board or the president. In the absence or
disability of the treasurer, his or her duties shall be performed by an
assistant treasurer.
11
ARTICLE VIII.
CONTRACTS, LOANS, CHECKS AND DEPOSITS
SECTION 1. CONTRACTS. The board of directors by resolution may authorize any
officer or officers, agent or agents, to enter into any contract or execute and
deliver any instrument in the name of and on behalf of the company, and such
authority may be general or confined to specific instances.
SECTION 2. LOANS. No loans shall be contracted on behalf of the company and
no evidences of indebtedness shall be issued in its name unless authorized by a
resolution of the board of directors. Such authority may be general or confined
to specific instances. SECTION 3. CHECKS AND DRAFTS. All checks, drafts or other
orders for the payment of money, notes or other evidences of indebtedness issued
in the name of the company shall be signed by such officer or officers, agent or
agents of the company and in such manner as shall from time to time be
determined by resolution of the board of directors.
SECTION 4. DEPOSITS. All funds of the company not otherwise employed shall
be deposited from time to time to the credit of the company in such banks, trust
companies or other depositories as the board of directors or officers of the
company designated by the board may select, or be invested as authorized by the
board.
ARTICLE IX.
CERTIFICATES FOR SHARES AND THEIR TRANSFER
SECTION 1. CERTIFICATES FOR SHARES. Certificates representing shares of the
company shall be issued only for whole numbers of shares and shall be in such
form as the board of directors may, from time to time, prescribe in accordance
with the laws of the State of Oregon. Such certificates shall be signed by the
president or a vice president and by the secretary or an assistant secretary and
sealed with the corporate seal or a facsimile thereof. The signatures of such
officers upon a certificate may be facsimiles thereof. In case of a lost,
destroyed or mutilated certificate a new one may be issued therefor upon such
terms and indemnity to the company as the board may authorize.
12
SECTION 2. TRANSFER. Shares of stock of the company shall be transferable on
the books of the company by the holder of record thereof, or by his or her legal
representative who shall furnish proper evidence of authority to transfer, or by
his or her attorney thereunto authorized by duly executed power of attorney, and
on surrender for cancellation of the certificates for such shares. The board of
directors may appoint one or more transfer agents and registrars of stock of the
company.
SECTION 3. OWNER OF RECORD. The company shall be entitled to recognize the
exclusive right of a person registered on its books as the owner of shares to
receive dividends and to vote as such owner and shall not be bound to recognize
any equitable or other claim to or interest in such share or shares on the part
of any other person, whether or not it shall have express or other notice
thereof, except as otherwise provided by law.
ARTICLE X.
INDEMNIFICATION AND INSURANCE
SECTION 1. INDEMNIFICATION. The company shall indemnify any person who was
or is a party or is threatened to be made a party to any threatened, pending or
completed action, suit or proceeding, whether civil, criminal, administrative or
investigative, by reason of the fact that he or she is or was director, officer,
employee or agent of the company, or is or was serving at the request of the
company as a director, officer, employee, agent or fiduciary of another
corporation, partnership, joint venture, trust or other enterprise or any
employee benefit plan, against expenses (including attorney's fees), judgments,
fines and amounts paid in settlement actually and reasonably incurred by him or
her in connection with the defense or settlement of such action, suit or
proceeding to the fullest extent permissible under the Oregon Business
Corporation Act or the indemnification provisions of any successor Act. The
foregoing rights of indemnification shall not be exclusive of any other rights
to which any such person so indemnified may be entitled, under any agreement,
vote of shareholders or disinterested directors or otherwise, both as to action
in his or her official capacity and as to action in another capacity while
holding such office; shall continue as to a person who has ceased to be a
director, officer, employee or agent; and shall inure to the benefit of the
heirs, executors and administrators of such a person.
13
SECTION 2. INSURANCE. The company may purchase and maintain insurance (and
pay the entire premium therefor) on behalf of any person who is or was a
director, officer, employee or agent of the company, or is or was serving at the
request of the company as a director, officer, employee or agent of another
corporation, partnership, joint venture, trust or other enterprise against any
liability asserted against him or her and incurred by him or her in any such
capacity or arising out of his or her status as such, whether or not the company
would have the power to indemnify him or her against such liability under the
provisions of the Oregon Business Corporation Act or any successor Act; and on
behalf of any person who is or was a fiduciary under the Employee Retirement
Income Security Act of 1974 with regard to an employee benefit plan of the
company against any liability asserted against him or her and incurred by him or
her in his or her fiduciary capacity.
ARTICLE XI.
SEAL
The corporate seal of the company shall be circular in form and shall
bear an inscription containing the name of the company, the year of its
organization, the state of its incorporation and the words "Corporate Seal."
ARTICLE XII.
AMENDMENTS
These bylaws, or any of them, may be altered, amended or repealed, or
new bylaws adopted, by resolution of a majority of the board of directors,
subject to repeal or change by action of the shareholders.
14
CERTIFICATE
I, C. J. Rue, Secretary of Northwest Natural Gas Company, a corporation
organized and existing under the laws of the State of Oregon, HEREBY CERTIFY
that the foregoing eight printed pages entitled "Bylaws of Northwest Natural Gas
Company" constitute a full and true copy of the Bylaws of said corporation as of
the date hereof.
WITNESS my hand and the seal of said corporation this ______ day of
________________________________.
C. J. Rue
Secretary
15
EXHIBIT C
---------
AMENDED AND RESTATED ARTICLES OF INCORPORATION
OF
NORTHWEST ENERGY CORPORATION
(These Amended and Restated Articles of Incorporation of NORTHWEST ENERGY
CORPORATION supersede its theretofore existing Articles of Incorporation and all
amendments thereto.)
ARTICLE I
A. The name of this corporation is NORTHWEST ENERGY CORPORATION, and its
duration shall be perpetual.
ARTICLE II
A. The purposes of the corporation are to engage in any lawful activity for
which corporations may be organized under the Oregon Business Corporation
Act.
ARTICLE III
A. The aggregate number of shares of capital stock which the corporation shall
have the authority to issue is 90,000,000 shares, divided into 10,000,000
shares of Preferred Stock without par value, 65,000,000 shares of Common
Stock without par value, and 15,000,000 shares of Class B Common Stock
without par value.
B. A statement of the preferences, limitations and relative rights of each
class of capital stock of the corporation, namely, the Preferred Stock, the
Common Stock and the Class B Common Stock, and of the authority vested in
the Board of Directors of the corporation to establish series of Preferred
Stock and to fix and determine the variations in the relative rights and
preferences as between series insofar as the same are not fixed by these
Amended and Restated Articles of Incorporation, is as follows:
PREFERRED STOCK
1. The Board of Directors of the corporation shall have the authority to
divide the Preferred Stock into series and to determine the
designation, preferences, limitations and relative rights of the
shares of each series so established, all to the extent and in the
manner provided by law.
COMMON STOCK AND CLASS B COMMON STOCK
2. Subject to the limitations, if any, specified with respect to the
Preferred Stock, or any series thereof, dividends may be paid on the
Common Stock and the Class B Common Stock when and as declared by the
Board of Directors of the corporation out of any funds legally
available for the payment of dividends, and dividends shall be
distributed ratably in accordance with their holdings to the holders
of the Common Stock and the Class B Common Stock. The rights of the
holders of shares of Common Stock and of the Class B Common Stock to
receive dividends, when and as declared by the Board of Directors of
the corporation, shall be identical, and no dividend shall be declared
or paid with respect to the Common Stock or the Class B Common Stock
unless a dividend of the same nature and equal in amount per share
shall also be declared and paid with respect to the other class of
common stock.
3. Subject to the limitations, if any, specified with respect to the
Preferred Stock, or any series thereof, upon any dissolution,
liquidation or winding up of the corporation, whether voluntary or
involuntary, the net assets of the corporation shall be distributed
ratably in accordance with their holdings to the holders of the Common
Stock and of the Class B Common Stock. The rights of the holders of
shares of Common Stock and of the Class B Common Stock upon any
dissolution, liquidation, or winding up of the corporation, whether
voluntary or involuntary, shall be identical, and no such distribution
shall be declared or made with respect to the Common Stock or the
Class B Common Stock unless a distribution of the same nature and
equal in amount per share shall also be declared and made with respect
to the other class of common stock.
4. All voting power shall be vested exclusively in the holders of shares
of the Common Stock, except to the extent any statute of the State of
Oregon shall expressly otherwise provide, and except as and to the
extent otherwise specified with respect to the Preferred Stock, or any
series thereof, and each holder of the Common Stock shall, in the
election of directors and upon each other matter coming before any
meeting of shareholders, be entitled to one vote for each share of
such stock standing in the name of such holder on the books of the
corporation.
5. If the corporation shall at any time (i) declare a stock dividend upon
the Common Stock payable in shares of its Common Stock, or (ii) make
any distribution upon the Common Stock payable in shares of Common
Stock, or (iii) subdivide the outstanding shares of Common Stock into
a greater number of shares or (iv) combine the outstanding shares of
Common Stock into a smaller number of shares, then and in any such
event the corporation shall also, declare, make or effect a ratable
stock dividend or distribution or subdivision on the Class B Common
Stock payable in shares of Class B Common Stock that is, on a per
share basis, equal in effect to that declared, made or effected on the
Common Stock.
6. Each share of Class B Common Stock shall be convertible, at the option
of the holder thereof, into one share of Common Stock; provided,
however, that if, after giving effect to any proposed act of
conversion, the holder of Class B Common Stock would thereby then own
shares of Common Stock entitled to cast five percent (5%) or more of
the total number of votes entitled to be cast by all issued and
outstanding shares of Common Stock, the act of conversion shall be
effective only as to those shares of Class B Common Stock that, when
converted, would result in the holder owning shares of Common Stock
entitled to cast less than five percent (5%) of the total number of
2
votes entitled to be cast by all then issued and outstanding shares of
Common Stock and shall be ineffective and of no force or effect with
respect to the balance of the shares of Class B Common Stock. The
holder of Class B Common Stock shall convert shares of Class B Common
Stock by surrendering to the corporation at any office of the
corporation, or at the office of the transfer agent or registrar
thereof, for cancellation, the certificate representing the shares of
Class B Common Stock to be converted, and such other documentation
that the corporation may reasonably request in connection with such
conversion, and, upon such surrender, shall be entitled to receive one
or more certificates representing the number of shares of Common Stock
that the corporation is required to issue upon conversion of shares of
Class B Common Stock as provided herein. As used in this subdivision
III.B.6, the term holder shall include any beneficial owner of Class B
Common Stock and beneficial owner shall have the meaning given such
term in Rule 13d-3 of the General Rules and Regulations under the
Securities Exchange Act of 1934 as in effect on the Effective Date (as
defined in subdivision IV.A.1 below), and any person's beneficial
ownership of Common Stock and Class B Common Stock shall be calculated
in accordance with the provisions of such Rule; provided, however,
that for purposes of calculating beneficial ownership of Common Stock
entitled to cast votes, beneficial ownership of shares of Class B
Common Stock shall be excluded.
7. Upon the conversion of shares of Class B Common Stock, or upon any
other acquisition by the corporation of shares of Class B Common
Stock, by purchase or otherwise, such shares of Class B Common Stock
shall be cancelled and retired, and may not be reissued.
8. Upon the issuance for money or other consideration of any shares of
capital stock of the corporation or of any security convertible into
or exchangeable for shares of capital stock of the corporation, no
holder of shares of the capital stock of the corporation, irrespective
of the class or kind thereof, shall have any preemptive or other right
to subscribe for, purchase or receive any proportionate or other
amount of such shares of capital stock, or such security convertible
into shares of capital stock, proposed to be issued; and the Board of
Directors of the corporation may cause the corporation to dispose of
all or any of such shares of capital stock, or any such security
convertible into or exchangeable for shares of capital stock, as such
Board of Directors of the corporation may determine, free of any such
right, either by offering the same to the corporation's then
shareholders or by otherwise selling or disposing of such shares or
other securities, as the Board of Directors may deem advisable.
ARTICLE IV
A. The business and affairs of the corporation shall be managed by a board of
directors. Except as provided in subdivision B below, the number of members
of the board, their classifications and terms of office, and the manner of
their election and removal shall be as follows:
3
1. The number of directors shall be that number, not less than nine or
more than fourteen, determined from time to time by resolution adopted
by affirmative vote of a majority of the entire board of directors.
The directors shall be divided into three classes, designated Class I,
Class II, and Class III. Each class shall consist, as nearly as
possible, of one-third of the total number of directors. The terms of
office of directors shall be classified as follows: (a) the term of
Class I shall expire at the first annual meeting of shareholders
following the effective date of these Amended and Restated Articles of
Incorporation (the "Effective Date"), (b) the term of Class II shall
expire at the second annual meeting of shareholders following the
Effective Date and (c) the term of Class III shall expire at the third
annual meeting of shareholders following the Effective Date. At each
succeeding annual meeting of shareholders, successors to directors
whose terms expire at that annual meeting shall be of the same class
as the directors they succeed, and shall be elected for three-year
terms. If the number of directors should be changed by resolution of
the board of directors, any increase or decrease shall be apportioned
among the classes so as to maintain the number of directors in each
class as nearly equal as possible, but in no case shall a decrease in
the number of directors shorten the term of any incumbent director.
2. A director shall hold office until the annual meeting for the year in
which his or her term shall expire and until his or her successor
shall have been elected and qualified, subject, however, to prior
death, resignation, retirement or removal from office. Any newly
created directorship resulting from an increase in the number of
directors and any other vacancy on the board of directors, however
caused, may be filled by the affirmative vote of a majority of the
directors then in office, although less than a quorum, or by a sole
remaining director. The term of a director elected to fill a newly
created directorship or any other vacancy shall expire at the next
shareholders' meeting at which directors are elected.
3. One or more of the directors may be removed with or without cause by
the affirmative vote of the holders of not less than two-thirds of the
shares entitled to vote thereon at a meeting of the shareholders
called expressly for that purpose, except that no Enron Director, as
such term is define in the Securityholders and Registration Rights
Agreement dated as of _____________, among Enron Corp., the Company,
and other entities named as parties thereto (the "Enron
Securityholders' Agreement"), a copy of which is on file with the
Secretary of the Company, may be removed without cause by the
shareholders without the express written consent of Enron, as provided
in Section 2.3 of the Enron Securityholders' Agreement.
4. No person, except those persons nominated by the board, shall be
eligible for election as a director at any annual or special meeting
of shareholders unless a written request that his or her name be
placed in nomination shall be received from a shareholder of record
entitled to vote at such election by the secretary of the corporation
not later than the later of (a) the thirtieth day prior to the date
fixed for the meeting or (b) the tenth day after the mailing of notice
of that meeting, together with the written consent of the nominee to
serve as a director.
4
B. This Article IV may not be repealed or amended in any respect unless such
action shall be approved by the affirmative vote of the holders of not less
than two-thirds of the shares entitled to vote at an election of directors
determined as provided in subdivision A. above, at a meeting of the
shareholders called expressly for that purpose.
ARTICLE V
A. For purposes of this Article V:
1. The term "Affiliate", as used to indicate a relationship with a
specified "Person" (as hereinafter defined), shall mean a Person that
directly or indirectly through one or more intermediaries, controls,
or is controlled by, or is under common control with, the Person
specified.
2. The term "Associate", as used to indicate a relationship with a
specified Person, shall mean (a) any Person (other than the
corporation) of which such specified Person is a director, officer,
partner, trustee, guardian, fiduciary or official or is, directly or
indirectly, the beneficial owner of 10 percent or more of any class of
equity securities or any beneficial interest, (b) any Person who is a
director, officer, partner, trustee, guardian, fiduciary or official
or is, directly or indirectly, the beneficial owner of 10 percent or
more of any class of equity securities or any beneficial interest of
or in such specified Person (other than the corporation), and (c) any
relative or spouse of such specified Person, or any relative of such
spouse who has the same home as such specified Person.
3. The term "Beneficial Owner" shall have the meaning set forth in Rule
13d-3 of the General Rules and Regulations under the Securities
Exchange Act of 1934 as in effect on the Effective Date; provided,
however, that, notwithstanding the provisions of such Rule, a Person
shall be deemed to be the Beneficial Owner of any share of the capital
stock of the corporation that such Person shall have the right to
acquire at any time pursuant to any agreement, contract, arrangement
or understanding, or upon exercise of conversion rights, warrants or
options, or otherwise, and any such share of capital stock shall be
deemed to be outstanding for purposes of subdivision V.A.9.
4. The term "Business Transaction" shall include, without limitation, (a)
any merger, consolidation or plan of exchange of the corporation, or
any Person controlled by or under common control with the corporation,
with or into any "Related Person" (as hereinafter defined), (b) any
merger, consolidation or plan of exchange of a Related Person with or
into the corporation or any Person controlled by or under common
control with the corporation, (c) any sale, lease, exchange, transfer
or other disposition (in one transaction or a series of transactions)
including without limitation a mortgage or any other security device,
of all or any "Substantial Part" (as hereinafter defined) of the
property and assets of the corporation, or any Person controlled by or
under common control with the corporation, to or with a Related
Person, (d) any purchase, lease, exchange, transfer or other
acquisition (in one transaction or a series of transactions),
5
including without limitation a mortgage or any other security device,
of all or any Substantial Part of the property and assets of a Related
Person, by or with the corporation or any Person controlled by or
under common control with the corporation, (e) any ecapitalization of
the corporation that would have the effect of increasing the voting
power of a Related Person, (f) the issuance, sale, exchange or other
disposition of any securities of the corporation, or of any Person
controlled by or under common control with the corporation, by the
corporation or by any Person controlled by or under common control
with the corporation, (g) any liquidation, spinoff, splitoff, splitup
or dissolution of the corporation, and (h) any agreement, contract or
other arrangement providing for any of the transactions described in
this subdivision.
5. The term "Continuing Director" shall mean a director who was a
director of the corporation on the Effective Date and a director who
shall become a director subsequent thereto whose election, or whose
nomination for election by the shareholders, shall have been approved
by a vote of a majority of the then Continuing Directors.
6. The term "Highest Purchase Price" shall mean, with respect to the
shares of any class or series of the capital stock of the corporation,
the highest amount of consideration paid by a Related Person for a
share of the same class and series at any time regardless of whether
the share was acquired before or after such Related Person became a
Related Person; provided, however, that the Highest Purchase Price
shall be appropriately adjusted to reflect the occurrence of any
reclassification, recapitalization, stock split, reverse stock split
or other readjustment in the number of outstanding shares of that
class or series, or the declaration of a stock dividend thereon. The
Highest Purchase Price shall include any brokerage commissions,
transfer taxes and soliciting dealers' fees paid by such Related
Person with respect to any shares of the capital stock acquired by
such Related Person.
7. The term "Other Consideration" shall include, without limitation,
capital stock to be retained by the shareholders of the corporation in
a Business Transaction in which the corporation shall be the survivor.
8. The term "Person" shall mean any natural person, corporation,
partnership, trust, firm, association, government, governmental agency
or any other entity whether acting in an individual, fiduciary or
other capacity.
9. The term "Related Person" shall mean (a) any Person which, together
with its Affiliates and Associates, shall be the Beneficial Owner in
the aggregate of 10 percent or more of the capital stock of the
corporation, and (b) any Affiliate or Associate (other than the
corporation or a wholly owned subsidiary of the corporation) of any
such Person. Notwithstanding anything to the contrary in this Article
V, during the period beginning on the Effective Date and ending on the
Termination Date (as such term is defined in the Enron
Securityholders' Agreement) neither Enron Corp., an Oregon
6
corporation, any of its Affiliates or Associates nor any of their
successors or assigns shall be deemed to be a Related Person under
this Article V. Two or more Persons acting in concert for the purpose
of acquiring, holding or disposing of the capital stock of the
corporation shall be deemed to be a "Related Person". A Related Person
shall be deemed to have acquired a share of capital stock at the time
when such Related Person became the Beneficial Owner thereof. With
respect to the shares of the capital stock of the corporation owned by
any Related Person, if the price paid for such shares cannot be
determined by a majority of the Continuing Directors, the price so
paid shall be deemed to be the market price of the shares in question
at the time when such Related Person became the Beneficial Owner
thereof.
10. The term "Substantial Part" shall mean 10 percent or more of the fair
market value of the total assets of a Person, as reflected on the most
recent balance sheet of such Person available to the Continuing
Directors on the date of mailing of the notice of the meeting of
shareholders called for the purpose of voting with respect to a
Business Transaction involving the assets constituting any such
Substantial Part.
B. The corporation shall not enter into any Business Transaction with a
Related Person or in which a Related Person shall have an interest (except
proportionately as a shareholder of the corporation) without first
obtaining both (1) the affirmative vote of the holders of not less than
two-thirds of the outstanding shares of the capital stock of the
corporation not held by such Related Person, and (2) the determination of a
majority of the Continuing Directors that the cash or fair market value of
the property, securities or Other Consideration to be received per share by
the holders, other than such Related Person, of the shares of each class or
series of the capital stock of the corporation in such Business Transaction
shall not be less than the Highest Purchase Price paid by such Related
Person in acquiring any of its holdings of shares of the same class or
series, unless the Continuing Directors by a majority vote shall either (a)
have expressly approved the acquisition of the shares of the capital stock
of the corporation that caused such Related Person to become a Related
Person, or (b) have expressly approved such Business Transaction.
C. For the purposes of this Article V, a majority of the Continuing Directors
shall have the power to make a good faith determination, on the basis of
information known to them, of: (1) the number of shares of capital stock of
the corporation of which any Person shall be the Beneficial Owner, (2)
whether a Person is an Affiliate or Associate of another Person, (3)
whether a Person has an agreement, contract, arrangement or understanding
with another Person as to the matters referred to in subdivision V.A.3. or
clause (h) of subdivision V.A.4., (4) the Highest Purchase Price paid by a
Related Person for shares of any class or series of the capital stock, (5)
whether the assets subject to any Business Transaction constitute a
Substantial Part, (6) whether any Business Transaction is one in which a
Related Person has an interest (except proportionately as a shareholder of
the corporation), and (7) such other matters with respect to which a
determination may be required under this Article V.
7
D. In determining whether to give their approval as provided in subdivision
V.B., the Continuing Directors shall give due consideration to all relevant
factors involved, including, without limitation, (1) the value of the
corporation in a freely negotiated transaction and its future value as an
independent entity, (2) the recognition of gain or loss to the corporation
for tax purposes or the postponement of such recognition in a tax-free
transaction, (3) the anticipated developments of the business of the
corporation not yet reflected in the price of its shares, and (4) the
impact on employees, customers, suppliers and the public generally within
the geographical area it serves.
E. This Article V may not be repealed or amended in any respect unless such
action shall be approved by the affirmative vote of the holders of not less
than two-thirds of the capital stock of the corporation not held by a
Related Person at a meeting of the shareholders called expressly for that
purpose.
ARTICLE VI
No director of the corporation shall be personally liable to the corporation or
its shareholders for monetary damages for conduct as a director; provided that
this Article VI shall not eliminate the liability of a director for any act or
omission for which such elimination of liability is not permitted under the
Oregon Business Corporation Act. No amendment to the Oregon Business Corporation
Act that further limits the acts or omissions for which elimination of liability
is permitted shall affect the liability of a director for any act or omission
which occurs prior to the effective date of such amendment.
ARTICLE VII
The corporation shall indemnify to the fullest extent then permitted by law any
person who is made, or threatened to be made, a party to any threatened, pending
or completed action, suit or proceeding, whether civil, criminal,
administrative, investigative or otherwise (including an action, suit or
proceeding by or in the right of the corporation) by reason of the fact that the
person is or was a director or officer of the corporation or is or was serving
at the request of the corporation as a director or officer of another
corporation, partnership, joint venture, trust or other enterprise against all
judgments, amounts paid in settlement, fines and such expenses (including
attorneys' fees), actually and reasonably incurred in connection therewith. This
Article shall not be deemed exclusive of any other provisions for
indemnification of directors and officers that may be included in any statute,
bylaw, agreement, vote of shareholders or directors or otherwise, both as to
action in any official capacity and as to action in another capacity while
holding an office.
8
EXHIBIT D
---------
BYLAWS
of
NORTHWEST
ENERGY
CORPORATION
As Adopted by the Board of Directors
_________, 200_
As Amended Through _________, 200_
CONTENTS
ARTICLE I. OFFICES............................................................1
Section 1. Office......................................................1
Section 2. Registered Office...........................................1
ARTICLE II. MEETINGS OF SHAREHOLDERS..........................................1
Section 1. Annual Meeting..............................................1
Section 2. Special Meetings............................................1
Section 3. Notice......................................................2
Section 4. Fixing Record Date..........................................2
Section 5. Record of Shareholders......................................2
Section 6. Quorum......................................................3
Section 7. Voting......................................................3
Section 8. Conduct of Meetings.........................................3
ARTICLE III. BOARD OF DIRECTORS...............................................4
Section 1. Directors...................................................4
Section 2. Chairman of the Board.......................................4
Section 3. Lead Director...............................................4
Section 4. Retired Directors...........................................4
Section 5. Compensation................................................4
ARTICLE IV. MEETINGS OF THE BOARD OF DIRECTORS................................5
Section 1. Regular Meetings............................................5
Section 2. Special Meetings............................................5
Section 3. Waiver of Notice............................................5
Section 4. Quorum......................................................5
Section 5. Manner of Acting............................................5
Section 6. Action Without a Meeting....................................6
ARTICLE V. COMMITTEES OF THE BOARD............................................6
Section 1. Executive Committee.........................................6
Section 2. Audit Committee.............................................6
Section 3. Retirement Committee........................................6
Section 4. Pension Committee...........................................7
Section 5. Organization and Executive Compensation Committee...........7
Section 6. Environmental Policy Committee..............................7
Section 7. Finance Committee...........................................8
Section 8. Other Committees............................................8
Section 9. Changes of Size and Function................................8
Section 10. Conduct of Meetings.........................................8
Section 11. Compensation................................................8
ARTICLE VI. NOTICES...........................................................9
Section 1. Form and Manner.............................................9
Section 2. Waiver......................................................9
ARTICLE VII. OFFICERS.........................................................9
Section 1. Election....................................................9
Section 2. Compensation................................................9
Section 3. Term........................................................9
Section 4. Removal....................................................10
Section 5. President..................................................10
Section 6. Vice Presidents............................................10
Section 7. Secretary..................................................10
Section 8. Treasurer..................................................10
ARTICLE VIII. CONTRACTS, LOANS, CHECKS AND DEPOSITS..........................11
Section 1. Contracts..................................................11
Section 2. Loans......................................................11
Section 3. Checks and Drafts..........................................11
Section 4. Deposits...................................................11
ARTICLE IX. CERTIFICATES FOR SHARES AND THEIR TRANSFER.......................11
Section 1. Certificates for Shares....................................11
Section 2. Transfer...................................................12
Section 3. Owner of Record............................................12
ARTICLE X. INDEMNIFICATION AND INSURANCE.....................................12
Section 1. Indemnification............................................12
Section 2. Insurance..................................................13
ARTICLE XI. SEAL.............................................................13
ARTICLE XII. AMENDMENTS......................................................13
BYLAWS
OF
NORTHWEST ENERGY CORPORATION
ARTICLE I.
OFFICES
Section 1. Office. The principal office of the company shall be located in
the City of Portland, Oregon. The company also may have offices at such other
places both within and without the State of Oregon as the board of directors
from time to time may determine.
Section 2. Registered Office. The registered office of the company required
by law to be maintained in the state shall be at the same location as the
principal office unless otherwise designated by resolution of the board of
directors.
ARTICLE II.
MEETINGS OF SHAREHOLDERS
Section 1. Annual Meeting. The annual meeting of shareholders of the
company for the election of directors and for the transaction of other business
shall be held at the company's office in the City of Portland, Oregon, or such
other place in that City as shall be determined by the board of directors, on
the fourth Thursday of May in each year, unless such day shall be a legal
holiday, in which event such meeting shall be held on the next business day. If
such meeting shall not be held on such day in any year, it shall be held within
60 days thereafter on such day as shall be fixed by the board of directors and
be specified in the notice of the meeting. Every such meeting shall be held at
the hour of two o'clock p.m., or at such other hour as shall be fixed by the
board and specified in such notice.
Section 2. Special Meetings. Special meetings of the shareholders of the
company may be called by the board of directors or the holders of not less than
one-tenth of all shares entitled to vote at the meeting. Each special meeting
shall be held for such purposes, at such place in the City of Portland, Oregon,
and at such time as shall be specified in the notice thereof.
Section 3. Notice. Written or printed notice stating the place, day and
hour of the meeting and, in case of a special meeting, the purpose or purposes
for which the meeting is called, shall be delivered not less than 10 nor more
than 50 days before the date of the meeting, either personally or by mail, by or
at the direction of the board of directors or the persons calling the meeting,
to each shareholder of record entitled to vote at such meeting.
Section 4. Fixing Record Date. For the purpose of determining shareholders
entitled to notice of or to vote at any meeting of shareholders, or any
adjournment thereof, or entitled to receive payment of any dividend, or in order
to make a determination of shareholders for any other proper purpose, the board
of directors may fix in advance a date as the record date for any such
determination of shareholders, such date in any case to be not more than 50 days
and, in the case of a meeting of shareholders, not less than 10 days prior to
the date on which the particular action requiring such determination of
shareholders is to be taken. If no record date is fixed for the determination of
shareholders entitled to notice of or to vote at a meeting of shareholders, or
shareholders entitled to receive payment of a dividend, the date on which notice
of the meeting is mailed or the date on which the resolution of the board
declaring such dividend is adopted, as the case may be, shall be the record date
for such determination of shareholders. When a determination of shareholders
entitled to vote at any meeting of shareholders has been made as provided in
this section, such determination shall apply to any adjournment thereof.
Section 5. Record of Shareholders. The officer or agent having charge of
the transfer books for shares of the company shall make, at least 10 days before
each meeting of shareholders, a complete record of the shareholders entitled to
vote at such meeting or any adjournment thereof, arranged in alphabetical order
with the address of and the number of shares held by each, which record, for a
period of 10 days prior to such meeting, shall be kept on file at the registered
office of the company and shall be subject to inspection by any shareholder at
any time during usual business hours. Such record also shall be produced and
kept open at the time and place of the meeting and shall be subject to the
inspection of any shareholder during the whole time of the meeting. The original
transfer books for shares shall be prima facie evidence as to who are the
shareholders entitled to examine such record or transfer books or to vote at any
meeting of the shareholders.
2
Section 6. Quorum. A majority of the shares of the company entitled to
vote, represented in person or by proxy, shall constitute a quorum at all
meetings of shareholders. If a quorum is present, in person or by proxy, the
affirmative vote of a majority of the shares represented at the meeting and
entitled to vote on the subject matter shall be the act of the shareholders,
unless the vote of a greater number, or voting by classes, is required by law or
the Amended and Restated Articles of Incorporation.
If a quorum shall not be represented at any meeting of shareholders,
the shareholders represented may adjourn the meeting from time to time without
further notice. At such adjourned meeting, at which a quorum shall be present or
represented, any business may be transacted which might have been transacted at
the meeting as originally noticed. The shareholders represented at a duly
organized meeting may continue to transact business until adjournment,
notwithstanding the withdrawal of enough shareholders to leave less than a
quorum.
Section 7. Voting. Each outstanding share, regardless of class, shall be
entitled to one vote on each matter submitted to a vote at a meeting of
shareholders, except to the extent that the voting rights of the shares of any
class or classes are limited or denied by law or the Amended and Restated
Articles of Incorporation. A shareholder may vote either in person or by proxy
executed in writing by the shareholder or by his or her duly authorized
attorney-in-fact. Such proxy shall be filed with the secretary of the company
before or at the time of the meeting.
Section 8. Conduct of Meetings. Every meeting of shareholders shall be
presided over by the chairman of the board, in his or her absence by the
president, in their absence by a vice president or, if none be present, by a
chairman appointed by the shareholders present at the meeting. The minutes of
such meeting shall be recorded by the secretary or an assistant secretary but,
if neither be present, by a secretary appointed for that purpose by the chairman
of the meeting.
3
ARTICLE III.
BOARD OF DIRECTORS
Section 1. Directors. The business and affairs of the company shall be
managed by its board of directors. The number of members of the board, their
classification and terms of office, and the manner of their election and removal
shall be determined as provided by the Amended and Restated Articles of
Incorporation. Directors need not be residents of the State of Oregon or
shareholders of the company. No person who has reached the age of 72 years shall
be eligible to be elected a director, but a director may serve until the next
annual meeting of shareholders after reaching that age.
Section 2. Chairman of the Board. The board of directors may elect one of
its members as chairman of the board. The chairman of the board, if that
position be filled, shall preside at all meetings of the shareholders and the
board of directors and shall have such other duties and responsibilities as may
be prescribed by the board of directors. If there shall be no chairman of the
board, or in his or her absence or disability, the president also shall exercise
the duties and responsibilities of that position.
Section 3. Lead Director. The board of directors shall elect one of its
members as lead director. The lead director shall, in the absence of the
chairman of the board and the president, preside at meetings of the board of
directors and shall preside at all meetings of the executive committee. The lead
director shall have such other duties and responsibilities as may be prescribed
by the board of directors.
Section 4. Retired Directors. Any person who, upon retirement as a director
after reaching age 72, shall have served as a director of the company for ten or
more years shall be appointed a retired director of the company for life. Any
other person who shall have served as a director of the company may be elected
by the board as a retired director of the company for one or more terms of one
year or less. A retired director may attend meetings of the board but shall not
have the right to vote at such meetings.
Section 5. Compensation. Directors shall receive such reasonable
compensation for their services as may be fixed from time to time by resolution
of the board of directors, and shall be reimbursed for their expenses properly
incurred in the performance of their duties as directors. No such payment shall
preclude any director from serving the company in any other capacity and
receiving such reasonable compensation for such services as may be fixed by
resolution of the board.
4
ARTICLE IV.
MEETINGS OF THE BOARD OF DIRECTORS
Section 1. Regular Meetings. Regular meetings of the board of directors
shall be held in the company's offices at two o'clock p.m., Pacific Time, on the
fourth Thursday of February, April, May, July and September, and on the third
Thursday of December, or on such other date or at such other hour and place as
shall be specified in the notice of meeting. The date, time and place for
holding regular meetings of the board of directors may be changed upon the
giving of notice to all directors by or at the request of the chairman of the
board or the president. The board may provide by resolution the time and place
either within or without the State of Oregon for holding of meetings or may omit
the holding of any meeting without other notice than such resolution.
Section 2. Special Meetings. Special meetings of the board of directors may
be called by or at the request of the chairman of the board, the lead director,
the president or any two directors. The person or persons authorized to call
special meetings of the board may fix any place, either within or without the
State of Oregon, as the place for holding any special meeting of the board
called by them. Notice of the time and place of special meetings shall be given
to each director at least one day in advance by the secretary or other officer
performing his or her duties.
Section 3. Waiver of Notice. Any director may waive notice of any meeting.
The attendance of a director at any meeting shall constitute a waiver of notice
of such meeting, except where a director attends a meeting for the express
purpose of objecting to the transaction of any business because the meeting is
not lawfully called or convened. Except as otherwise provided by law or the
Amended and Restated Articles of Incorporation, neither the business to be
transacted at, nor the purpose of, any regular or special meeting of the board
of directors need be specified in the notice or waiver of notice of such
meeting.
Section 4. Quorum. A majority of the number of directors at any time fixed
by resolution adopted by the affirmative vote of a majority of the entire board
of directors shall constitute a quorum for the transaction of business. If a
quorum shall not be present at any meeting of directors, the directors present
may adjourn the meeting from time to time without further notice until a quorum
shall be present.
Section 5. Manner of Acting. Except as otherwise provided by law or the
Amended and Restated Articles of Incorporation, the act of the majority of the
directors present at a meeting at which a quorum is present shall be the act of
the board of directors.
5
Section 6. Action Without a Meeting. Any action required or permitted to be
taken at a meeting of the board of directors may be taken without a meeting if a
consent in writing, setting forth the action so taken, shall be signed by all of
the directors entitled to vote with respect to the subject matter thereof.
ARTICLE V.
COMMITTEES OF THE BOARD
Section 1. Executive Committee. The board of directors at any time, by
resolution adopted by a majority of the board of directors, may appoint an
executive committee composed of the chairman of the board, the lead director,
and such other number of directors as the board may from time to time determine.
The lead director, or in his or her absence, the chairman of the board, shall
act as chairman. The committee shall have and may exercise all of the authority
of the board of directors in the management of the company, except with respect
to matters upon which by law only the board of directors may act. The duties of
the committee shall include recommending to the board nominees for election as
directors, the conduct of periodic reviews of board effectiveness and the
performance of such other functions as the board by resolution from time to time
may direct.
Section 2. Audit Committee. The board of directors at any time, by
resolution adopted by a majority of the board of directors, may appoint an audit
committee composed of three or more directors, none of whom shall be an officer
of the company. The board shall designate one member of the committee as
chairman. The duties of the committee shall be to discuss and review with the
company's independent auditors the annual audit of the company, including the
scope of the audit, and report the results of this review to the board; to meet
with the independent auditors at such other times as the committee shall deem to
be advisable; and to perform such other functions as the board by resolution
from time to time may direct.
Section 3. Retirement Committee. The board of directors at any time, by
resolution adopted by a majority of the board of directors, shall appoint a
retirement committee composed of three or more directors, a majority of whom
shall not be members under the company's Non-Bargaining Unit Employees
Retirement Plan established by the board. Any action required or permitted to be
taken by the committee must be approved by both (a) a majority of the committee
members present at a meeting at which a quorum is present, and (b) a majority of
the total number of committee members who are not members under said Plan. The
chairman of the committee shall not be a member under said Plan. The duties of
the committee shall be to monitor the general administration of the company's
Non-Bargaining Unit Employees Retirement Plan and the committee shall be
responsible for monitoring the carrying out of its provisions as more fully set
forth under the terms of the Plan.
6
Section 4. Pension Committee. The board of directors at any time, by
resolution adopted by a majority of the board of directors, shall appoint three
or more directors to serve on the pension committee provided for in the
company's Bargaining Unit Employees Retirement Plan established by the board.
The duties of the committee shall be to monitor the general administration of
the Bargaining Unit Employees Retirement Plan and the committee shall be
responsible for monitoring the carrying out of its provisions as more fully set
forth under the terms of the Plan.
Section 5. Organization and Executive Compensation Committee. The board of
directors at any time, by resolution adopted by a majority of the board of
directors, may appoint an organization and executive compensation committee
composed of three or more directors, none of whom shall be an officer of the
company. The board shall designate one member of the committee as chairman. The
duties of the committee shall be to discuss and review the management of the
affairs of the company relating to its organization and to executive personnel
and their compensation, and to perform such other functions as the board by
resolution from time to time may direct.
Section 6. Environmental Policy Committee. The board of directors at any
time, by resolution adopted by a majority of the board of directors, may appoint
an environmental policy committee composed of three or more directors, a
majority of whom shall not be officers or retired officers of the company. Any
action required or permitted to be taken by the committee must be approved by
both (a) a majority of the committee members present at a meeting at which a
quorum is present, and (b) a majority of the total number of committee members
who are not officers or retired officers of the company. The board shall
designate one member of the committee who is not an officer or retired officer
of the company as chairman. The duties of the committee shall be to develop and
recommend to the board appropriate environmental policies and to perform such
other functions as the board by resolution from time to time may direct.
7
Section 7. Finance Committee. The board of directors at any time, by
resolution adopted by a majority of the board of directors, may appoint a
finance committee composed of three or more directors, a majority of whom shall
not be officers or retired officers of the company. Any action required or
permitted to be taken by the committee must be approved by both (a) a majority
of the committee members present at a meeting at which a quorum is present, and
(b) a majority of the total number of committee members who are not officers or
retired officers of the company. The board shall designate one member of the
committee who is not an officer or retired officer of the company as chairman.
The duties of the committee shall be to discuss and review the management of the
affairs of the company relating to financing, including the development of
long-range financial planning goals and financial policy, and to perform such
other functions as the board by resolution from time to time may direct.
Section 8. Other Committees. The board of directors at any time, by
resolution adopted by a majority of the board of directors, may appoint from
among its members such other committees and the chairmen thereof as it may deem
to be advisable. Each such committee shall have such powers and authority as are
set forth in the resolutions pertaining thereto from time to time adopted by the
board.
Section 9. Changes of Size and Function. Subject to the provisions of law,
the board of directors shall have the power at any time to increase or decrease
the number of members of any committee, to fill vacancies thereon, to change any
members thereof and to change the functions and terminate the existence thereof.
Section 10. Conduct of Meetings. Each committee shall conduct its meetings
in accordance with the applicable provisions of these bylaws relating to the
conduct of meetings of the board of directors. Each committee shall adopt such
further rules and regulations regarding its conduct, keep such minutes and other
records and appoint such subcommittees and assistants as it shall deem to be
appropriate.
Section 11. Compensation. Persons serving on any committee shall receive
such reasonable compensation for their services on such committee as may be
fixed by resolution of the board of directors, provided that no person shall
receive compensation for his or her services on any committee while serving as
an officer of the company.
8
ARTICLE VI.
NOTICES
Section 1. Form and Manner. Whenever, under the provisions of law or the
Amended and Restated Articles of Incorporation, notice is required to be given
to any director or shareholder, unless otherwise specified, it shall be given in
writing by mail addressed to such director or shareholder at his or her address
as it appears on the stock transfer books or other records of the company, with
postage thereon prepaid, and such notice shall be deemed to be delivered when
deposited in the United States Mail. Notice to directors also shall be given by
telephone or in any other manner which is reasonably calculated to give adequate
notice.
Section 2. Waiver. Whenever any notice whatever is required to be given
under the provisions of law, the Amended and Restated Articles of Incorporation
or these bylaws, a waiver thereof in writing signed by the person or persons
entitled to such notice, whether before or after the time stated therein, shall
be deemed equivalent to the giving of such notice.
ARTICLE VII.
OFFICERS
Section 1. Election. The board of directors, at its first meeting following
the annual meeting of shareholders each year, shall elect one of its members as
president and shall elect a secretary. At such meeting, or at any other time it
shall deem appropriate, the board may elect one or more vice presidents and a
treasurer. The board also may elect or appoint such other officers and agents as
it may deem necessary. Any two or more offices may be held by the same person,
except the offices of president and secretary.
Section 2. Compensation. The officers of the company shall receive such
reasonable compensation for their services as from time to time may be fixed by
resolution of the board of directors.
Section 3. Term. The term of office of all officers shall commence upon
their election or appointment and shall continue until the first meeting of the
board of directors following the annual meeting of shareholders and thereafter
until their successors shall be elected or until their resignation or removal. A
vacancy occurring in any office of the company for whatever reason may be filled
by the board.
9
Section 4. Removal. Any officer or agent elected or appointed by the board
of directors may be removed by the board whenever in its judgment the best
interests of the company will be served thereby but such removal shall be
without prejudice to the contract rights, if any, of the officer or agent so
removed.
Section 5. President. Unless otherwise determined by the board of
directors, the president shall be the chief executive officer of the company
and, subject to the control of the board of directors, shall be responsible for
the general administration and operation of the company. He shall have such
other duties and responsibilities as may pertain to such office or be prescribed
by the board of directors. In the absence or disability of the president, an
officer designated by the board shall exercise the duties and responsibilities
of the president.
Section 6. Vice Presidents. Each vice president shall have such duties and
responsibilities as may be prescribed by the board of directors and the
president. The board or the president may confer a special title upon a vice
president.
Section 7. Secretary. The secretary shall record and keep the minutes of
the shareholders in one or more books provided for that purpose; see that all
notices are duly given in accordance with the provisions of these bylaws or as
required by law; and perform such other duties as may be prescribed by the board
or the president. The secretary shall have custody of the corporate seal of the
company and shall affix the seal to any instrument requiring it and attest the
same by his or her signature.
The assistant secretaries shall have such duties as may be prescribed
from time to time by the board, the president or the secretary. In the absence
or disability of the secretary, his or her duties shall be performed by an
assistant secretary.
Section 8. Treasurer. The treasurer shall have charge and custody and be
responsible for all funds and securities of the company; deposit all moneys and
other valuable effects in the name and to the credit of the company in such
depositories as may be designated by the board of directors; and disburse the
funds of the company as may be authorized by the board and take proper vouchers
for such disbursements. The treasurer shall have such other duties as may be
prescribed from time to time by the board or the president. In the absence or
disability of the treasurer, his or her duties shall be performed by an
assistant treasurer.
10
ARTICLE VIII.
CONTRACTS, LOANS, CHECKS AND DEPOSITS
Section 1. Contracts. The board of directors by resolution may authorize
any officer or officers, agent or agents, to enter into any contract or execute
and deliver any instrument in the name of and on behalf of the company, and such
authority may be general or confined to specific instances.
Section 2. Loans. No loans shall be contracted on behalf of the company and
no evidences of indebtedness shall be issued in its name unless authorized by a
resolution of the board of directors. Such authority may be general or confined
to specific instances.
Section 3. Checks and Drafts. All checks, drafts or other orders for the
payment of money, notes or other evidences of indebtedness issued in the name of
the company shall be signed by such officer or officers, agent or agents of the
company and in such manner as shall from time to time be determined by
resolution of the board of directors.
Section 4. Deposits. All funds of the company not otherwise employed shall
be deposited from time to time to the credit of the company in such banks, trust
companies or other depositories as the board of directors or officers of the
company designated by the board may select, or be invested as authorized by the
board.
ARTICLE IX.
CERTIFICATES FOR SHARES AND THEIR TRANSFER
Section 1. Certificates for Shares. Certificates representing shares of the
company shall be issued only for whole numbers of shares and shall be in such
form as the board of directors may, from time to time, prescribe in accordance
with the laws of the State of Oregon. Such certificates shall be signed by the
president or a vice president and by the secretary or an assistant secretary and
sealed with the corporate seal or a facsimile thereof. The signatures of such
officers upon a certificate may be facsimiles thereof. In case of a lost,
destroyed or mutilated certificate a new one may be issued therefor upon such
terms and indemnity to the company as the board may authorize.
11
Section 2. Transfer. Shares of stock of the company shall be transferable
on the books of the company by the holder of record thereof, or by his or her
legal representative who shall furnish proper evidence of authority to transfer,
or by his or her attorney thereunto authorized by duly executed power of
attorney, and on surrender for cancellation of the certificates for such shares.
The board of directors may appoint one or more transfer agents and registrars of
stock of the company.
Section 3. Owner of Record. The company shall be entitled to recognize the
exclusive right of a person registered on its books as the owner of shares to
receive dividends and to vote as such owner and shall not be bound to recognize
any equitable or other claim to or interest in such share or shares on the part
of any other person, whether or not it shall have express or other notice
thereof, except as otherwise provided by law.
ARTICLE X.
INDEMNIFICATION AND INSURANCE
Section 1. Indemnification. The company shall indemnify any person who was
or is a party or is threatened to be made a party to any threatened, pending or
completed action, suit or proceeding, whether civil, criminal, administrative or
investigative, by reason of the fact that he or she is or was director, officer,
employee or agent of the company, or is or was serving at the request of the
company as a director, officer, employee, agent or fiduciary of another
corporation, partnership, joint venture, trust or other enterprise or any
employee benefit plan, against expenses (including attorney's fees), judgments,
fines and amounts paid in settlement actually and reasonably incurred by him or
her in connection with the defense or settlement of such action, suit or
proceeding to the fullest extent permissible under the Oregon Business
Corporation Act or the indemnification provisions of any successor Act. The
foregoing rights of indemnification shall not be exclusive of any other rights
to which any such person so indemnified may be entitled, under any agreement,
vote of shareholders or disinterested directors or otherwise, both as to action
in his or her official capacity and as to action in another capacity while
holding such office; shall continue as to a person who has ceased to be a
director, officer, employee or agent; and shall inure to the benefit of the
heirs, executors and administrators of such a person.
12
Section 2. Insurance. The company may purchase and maintain insurance (and
pay the entire premium therefor) on behalf of any person who is or was a
director, officer, employee or agent of the company, or is or was serving at the
request of the company as a director, officer, employee or agent of another
corporation, partnership, joint venture, trust or other enterprise against any
liability asserted against him or her and incurred by him or her in any such
capacity or arising out of his or her status as such, whether or not the company
would have the power to indemnify him or her against such liability under the
provisions of the Oregon Business Corporation Act or any successor Act; and on
behalf of any person who is or was a fiduciary under the Employee Retirement
Income Security Act of 1974 with regard to an employee benefit plan of the
company against any liability asserted against him or her and incurred by him or
her in his or her fiduciary capacity.
ARTICLE XI.
SEAL
The corporate seal of the company shall be circular in form and shall bear
an inscription containing the name of the company, the year of its organization,
the state of its incorporation and the words "Corporate Seal."
ARTICLE XII.
AMENDMENTS
These bylaws, or any of them, may be altered, amended or repealed, or new
bylaws adopted, by resolution of a majority of the board of directors, subject
to repeal or change by action of the shareholders.
13
CERTIFICATE
I, C. J. Rue, Secretary of Northwest Energy Corporation, a corporation
organized and existing under the laws of the State of Oregon, HEREBY CERTIFY
that the foregoing eight printed pages entitled "Bylaws of Northwest Energy
Corporation" constitute a full and true copy of the Bylaws of said corporation
as of the date hereof.
WITNESS my hand and the seal of said corporation this ______ day of
___________________________________.
---------------------------------------
C. J. Rue
Secretary
14
EXHIBIT E
---------
DIRECTORS OF NORTHWEST NATURAL GAS COMPANY
Richard G. Reiten
Mark S. Dodson
Bruce R. DeBolt